By Patrick Smith

Doubleday -- 331pp -- $24

What does making cars and VCRs have to do with competing in the America's Cup? In Japan, plenty, as Patrick Smith shows in The Nippon Challenge, an engaging if excessively detailed account of Japan's long-shot bid to win the elite sailboat race. Smith makes the story of Japan's first cup entry a metaphor for the country's entire postwar economic strategy: Borrow someone else's ideas and work relentlessly to improve upon them.

The tale starts in 1987, when a group of Japanese executives and sailing enthusiasts flew one of America's most seasoned cup sailors to Tokyo for consultations. Given Japan's lack of sailboat-racing tradition, the organizers had a lot to learn. How much would it cost to launch a credible team? What sort of training would be needed? The Japanese then purchased from New Zealand two yachts from the 1987 race and used sophisticated computers to redesign the hulls and keels. They also hired a skipper and other top crewmen from New Zealand.

The syndicate's fund-raising effort is another textbook case of how business gets done in Japan. For the U.S. syndicate, billionaire Bill Koch forked over $65 million. In Japan, 30 corporations pitched in just $1 million each and donated an additional $15 million in research and computer time. (The syndicate's pitch to Japanese executives, Smith says, emphasized showing that Japanese could spend lavishly on something frivolous, to humanize their image abroad.)

When the races' organizing committee unexpectedly scrapped 12-meter yachts in favor of a new class of boats, Japan's designers could no longer just make existing boats better. That proved daunting. In computer simulations, their new yacht sailed flawlessly, but the real thing handled poorly and often broke down. So engineers designed one that performed dramatically better--so much so that the Nippon Challenge won 18 of 21 races before being knocked out of the semifinals. Its sailors are improving, too. Next time, look for a Japanese skipper.


Before it's here, it's on the Bloomberg Terminal. LEARN MORE