By Fumihiro Kitayama / Yomiuri Shimbun Senior WriterUnicharm Corp., the largest domestic manufacturer of disposable diapers and feminine hygiene products, continues to expand its overseas operations with a focus on Asia. How will they identify the needs of customers going forward? In this installment of Leaders, a column featuring corporate management and senior executives, The Yomiuri Shimbun spoke to President and Chief Executive Officer Takahisa Takahara.
We relieve the burdens of ordinary people, from infants to seniors, by transforming all kinds of discomfort into comfort. This idea is the foundation of our business, which spans more than 80 countries and regions around the world.
Every year, I spend about 100 days on business trips overseas. I can’t see what I need to see from my office at headquarters. Gathering information is essential to ensure the ability to seize business opportunities in emerging countries, primarily in Asia.
[After his appointment as president, Takahara began expanding the company’s overseas business in earnest. In Indonesia, the company developed its business ahead of U.S. firm Proctor & Gamble and acquired a large market share in the country.]
I visit people’s homes to see how they live. What’s the layout of the houses they live in? What is their kitchen, toilet or bath like? What kind of furniture, furnishings and household supplies do they use and how? By observing things as they are, I can get to the bottom of their needs.
I always have a look around local retail stores as well. Where do they place which brands and what kind of products are on the sales floor? I value the insights and firsthand impressions you can get on the spot. Without them, planning a strategy and making decisions is impossible. This is because the desired features and value of products vary depending on the country and the culture.
In Indonesia, we’ve expanded our sales routes by making door-to-door visits to small retail stores, called “warung” in the local language. Currently, there are roughly 3 million such stores.
A typical household spends around ¥10 per disposable diaper. Instead of the type of diapers that sell in Japan, which emphasize slimness and a good fit, more absorbent types are preferred, even if they are bulky.
Feminine sanitary napkins are often washed before disposal in the Islamic world for religious reasons. To make them easy to wash, it’s necessary to treat the surface with a film so that they won’t expand when they absorb moisture. Being bound to a fixed idea as to what a sanitary napkin is can be an obstacle to product development.
Western or Japanese values are not necessarily applicable in developing countries in Asia. Moreover, it’s difficult to discover the opinions of users on the usability and desired features of disposable diapers and feminine hygiene products. How does one accommodate the opinions of “voiceless customers” such as infants who are unable to express their impressions of using a product? I’m always thinking about such things.
China wants Japan-made diapers
[In the period from January to March 2018, the volume of Unicharm’s exports to China via cross-border e-commerce soared to 2.6 times the volume during the same period last year. The company is working rapidly to establish a product supply chain that is flexible in regard to local manufacturing and sales.]
We must always be sensitive to changes in customer needs and the business environment.
In the past, you could hardly go wrong in Asia if you released products based on a “winning formula” established in Japan. Until now, our key products [in developing countries] have included mainly low-end products produced locally.
However, high-end products such as disposable diapers made in Japan sell well in China nowadays. Consumers value safety and reliability, and they’ve also come to be particular about raw materials and country of origin. Not only has demand from visitors to Japan risen, but Japanese-made exports to China have increased as well.
Our core sales channels have also shifted from retail outlets to e-commerce. Our company has reached approximately 4.8 million followers on the childcare information website Babily, which began streaming videos in China last February, and providing high-quality childcare information has boosted sales. We’re also working to keep pace with the ongoing adoption of digitalization in Southeast Asia.
At the end of 2018, a new state-of-the-art factory will begin operations in Fukuoka Prefecture. By opening our first domestic factory in 25 years, we will be able to accommodate the rise in exports to Asia.
The domestic market is also changing. With the aging of the population, more people are experiencing trouble with incontinence. Problems like urinary incontinence can cause people to become shut-ins, which may also lead to the onset of cognitive impairment. Bolstering our lineup of incontinence care products and services for adults contributes to healthy life expectancy. Through incontinence care, we are also making efforts to popularize “social walking,” which promotes spending time outdoors.
The declining birthrate has caused pets to become important partners that provide emotional comfort and warmth. I believe that our products related to pet food and toiletries will help people to maintain mental health and promote social engagement by living together with pets.
Doing things my way
When my appointment as president was announced in 2001, our company’s stock price crashed.
My father, Keiichiro, the founder (who currently serves as company director founder), berated me: “Our stock price fell because of you.” Stock prices are like a report card for managers. The typical response was, “Is this guy going to work out?”
In the career plan I envisioned, my intention was to spend around 20 years building up sufficient experience before taking over management in my 50s. This means that I was appointed president 10 years earlier than I had anticipated. The chilly reception I received was only natural.
There was also some backlash against my father, who appointed me, but it was reassuring to know that’s just how it goes sometimes. For a founder, the company and employees are more important than family. He must have felt that the value of the company had been damaged.
At the same time, I resolved that I would do things my own way, without taking cues from anyone. My resolve still remains unchanged to this day.
After my appointment, I made the decision to withdraw from the building materials business we had been engaged in since our founding and allocate management resources to growth areas such as overseas markets. Despite some opposition, the employees stood by me. In that sense, the inheritance of the company and staff I took over was precious.
[Takahara arrives at his office at 6:30 every morning. His first task is to send emails to employees celebrating birthdays. This is to maintain communication with them.]
I am not what you might call a charismatic manager. I don’t believe that I can lead the company alone. It’s necessary to strengthen the organization and to do that, it is necessary for all employees to aim in the same direction.
Knowledge and ingenuity moving like a pendulum back and forth between staff and management produces big results. I call this technique “resonance management.” Two-way communication with employees must be valued above all else.
■Takahisa Takahara / President and CEO of Unicharm Corp.
A native of Ehime Prefecture, Takahara was born in 1961. He graduated from Seijo University’s faculty of economics in 1986. After working at Sanwa Bank (now MUFG Bank), he joined Unicharm Corp. in 1991. He served as vice chairman of a Taiwan subsidiary, and then worked in the feminine hygiene business and international divisions. Takahara was responsible for management strategy before assuming his current post in June 2001. He is the eldest son of Unicharm founder Keiichiro Takahara.
■Key numbers: 62.1%
Consolidated sales for December 2017 rose 6.1 percent over the previous year to ¥641.6 billion, setting an all-time high. Overseas sales, including cross-border e-commerce exports from Japan, accounted for 62.1 percent and Asia for 42.9 percent of that figure. Originally part of Taisei Kako Co., which was founded in 1961, the company began manufacturing and selling sanitary napkins in 1963. The company name was changed to Unicharm in 1974. It had a workforce of 15,757 people as of December 2017.