Q&A with Yozo Hasegawa

Question: Describe your television program where you interview top Japanese managers.

Answer: Ihave two regular interview programs with Japanese managers every Saturday. One is “Direct Interview with Top Management” on TV-Tokyo and the other is “A Visit with a Dreaming Entrepreneur” on Radio Nikkei.

Q: Many experts say that Japanese managements’ golden age was in the 1980’s “bubble economy” era...but that burst! Are you a brave commentator to claim Japanese management can be a model?

A: The golden age was based on Japanese Inc.’s strong team work between the government and companies. But after the corruption of the bubble economy during the 1990’s, some clever Japanese cultivated their resources by themselves through a selective concentration strategy, creating new markets and a global strategy. So Japan’s present success is based on a private orientated strategy instead of Japan Incs. style.

Q: What specific criterion led you to select the 15 case studies?

A: Iselected 15 companies from the main industries that show either high earning performance or future potential.

Q: Makoto Lida of Secom provided security devices to companies, then realized that mar-ried couples and the elderly are also a market. What is the lesson here?

A: He always watched social trends for a business chance. Now he is interested in Japan’s aging society and addresses caring for single old people.

Q: Shinzo Maeda of Shiseido Cosmetics says do not wait for crisis to change. He streamlined the company before the global recession. But very few people can honor this precept, correct?

A: Yes. When Maeda became president, Shiseido had a big oversupply of products and the brand image was not clear. But many lacked a sense of emergency. So Maeda’s first mission was to change the employee’s consciousness.

Q: You cite how Renault sent an expat, Carlos Ghosn, to restructure its partner, Nissan. Why and did it work?

A: When Renault invested capital in Nissan, Louis Schweitzer was Renault’s C.E.O. He relied on Carlos Ghosn, vice president, and appreciated his ability to restructure Nissan. So Schweitzer made the latter his successor.

Q: Your book says that Nintendo famously refuses to publicly state its business plan. How does this encourage investors to buy its stock?

A: Success in the game computer business always depends on new game software, which faces hard competition. So it’s very difficult to disclose the business plan early, but investors buy Nintendo stocks expecting profit.

Q: You insist that a cultural quirk is that Kyoto people want to be different from Tokyo’s. Cite examples of this.

A: Kyoto is Japan’s old capital. The citizens respect themselves and don’t care about Tokyo. They show an independent spirit and so there are many such companies such as Kyocera.

Q: Osaka was the center of Japan’s commerce during the pre-industrial Meiji era and after, producing powerful firms like Mitsui. What is the mentality there?

A: The Osaka mentality is stingy and independent, e.g. Sumitomo.

Q: Explain the concept of genba’ism that you say Kaoru Seto of Yamato Holdings transport company shows.

A: Kaoru Seto had a unique experience during his school days. He worked at a side business be-sides studying. Through this experience, he learned to work with front line people to find business solutions. Genba’ism means to communicate and study with ordinary people such as truck drivers who directly know the customer’s requirements.

Q: Yuzaburu Mogi of Kikkoman foods was the first Japanese to earn an MBA -- at Columbia. Why did so few Japanese do such a degree?

A: Mogi got an MBA in 1961. Japan was not open to the outside so few people had such a degree.

Q: Mogi favored what you call “rational” Western practices such as deregulation, risk taking and incentive pay for executives. Did these work for Kikkoman?

A: Kikkoman is a very old company, but it developed a global business earlier and depends a lot on it. Kikkoman is a westernized company because each division can decide freely to work speedily.

Q: Why didn’t others imitate him?

A: Mogi is a famous manager who has many ideas and he contributes much to business society.

Q: You mention that Tadashi Yanai of the Fast Retailing Company introduced an in house business school in 2010. Summarize its purpose and methods.

A: Fast Retailing expanded too much during a short time. So experienced managers and Mr. Yanai wish to educate people about better management.

Q: Akio Mimura of Nippon Steel Corp. advises one to research and examine slowly and care-fully, but to rapidly execute the decision. This is not original, but the traditional Japanese precept -- correct?

A: Yes. Japanese companies’ tendency is not to be so speedy, e.g. Toyota. But recently it feels obliged to change its traditional decision making to cope with tough competition.

Q: Yasuchika Hasegawa of Takeda Pharmaceuticals was patient. Is this outdated in globalist competition where the weak are quickly eliminated?

A: When Isay Hasegawa is patient, it does not mean slow. Even with hard issues, he can decide.

Q: Masahiro Sakane of Komatsu construction emphasizes “visability”, where employees see all aspects of the operation to reform the entire system. But this requires ending internal compartmentalization, having a detailed view of a large process and much dialogue... can firms achieve this?

A: Yes, when Sakane says “visability”, it means each employee should understand his work, not only the details but also the entire system. Sakane also respects genba’isim but he always emphasizes seeing the total view.

Q: Your book says that Western management is top down while Japanese is middle up. Some experts insist that the reverse is true...your comment?

A: Ibelieve Japanese traditional management style is bottom-up as we seen in quality circles. But Carlos Ghosn brought to Japan a top down style and the mixed style is becoming popular.

Q: Canon cameras sticks to Japanese style lifetime management, while also applying strong supply chain and cash flow metrics. How is this an example of wakon yosai or Japanese spirit and Western technique?

A: Fujio Mitarai, C.E.O. of Canon, is a famous manager against the direct injection of the American management style. Canon is a very profitable company. It continues to use Japanese lifetime employment to keep good human resources. This is the Canon spirit.

Q: What percentage of managers are using purely Japanese management vs. Western or a mixture?

A: Nowadays Japanese companies use a mixed style.