Pursuing originality to stay in the lead

Ryuzo Suzuk / The Yomiuri Shimbun

Masayuki Nakamura speaks to The Yomiuri Shimbun.

By Koichi Kuranuki / Yomiuri Shimbun Senior Writer Okamura Corporation — well known for its manufacturing and sales of high-quality office furniture — has been making products that improve the workplace environment amid efforts to reform work styles in Japan. For this installment of Leaders, a column featuring corporate management and senior executives, Masayuki Nakamura, president of Okamura Corporation, explains his management strategy, which he inherited from the company’s founder.

The company was founded after World War II by people including engineers from Japan Aircraft Manufacturing Co. Kenjiro Yoshiwara and other founding members launched the Okamura MFG. Co., Ltd. [now Okamura Corporation] in Yokohama by putting together their savings and retirement pay.

It was a start-up company with no major shareholder to rely on. We have preserved the founding spirit that existed from the start.

At that time, the company’s policy was: Manufacture competitive products for the global market, try new things, aim for high quality, and make products for places where people come together.

The company first focused on manufacturing automobiles. In 1952, a car development team was formed that went on to produce a car with an automatic transmission, the Mikasa. That name is said to have come from the battleship Mikasa that defeated the Baltic Fleet in the Russo-Japanese War.

Unfortunately, the company had to withdraw from the automobile business because it failed to secure enough funding from banks. Nonetheless, a strong desire to produce good products remains ingrained in us as a manufacturing company.

When it was founded, the company hired students who had studied industrial design in a bid to develop sports cars. Even after shifting our core business to office furniture, Okamura has worked hard to emphasize product design. In my view, this is because we have inherited the corporate traditions of an automobile company. Product design is as important to furniture as it is to automobiles. It is design that creates a brand image. Probably no other furniture manufacturer employs as many in-house designers as we do.

I joined the company while Yoshiwara was still alive. I was privileged to come up under his tutelage. I am the only executive left who knew the founder. Because of that, I have been visiting our branches to talk with employees about corporate history and culture.

I always ask employees to write down their thoughts after these meetings, even if it’s only a line or two. I’m happy when I receive feedback like, “I had thought the president was beyond our reach, but it turned out he’s easy to talk to.”

Overhauling production method

[Okamura has reexamined long-held corporate practices and committed itself to creating new value.]

When I was working in the marketing division in the 1980s, I began to wonder why our desks, chairs, cabinets and other products were being designed separately. Customers usually purchase our furniture as a set, so I thought we should offer similar designs across all of our products. After my proposal was adopted and put into practice, sales improved.

Around 1990, I hit on the idea of expanding the use of wooden desks — which had mainly been reserved for company executives — to places where general employees worked. We created new products that combined wood and metal materials to bring the gentle touch of wood to offices. The most challenging part was changing the production methods at our factories.

In the aftermath of the 2008 collapse of Lehman Brothers, our sales plunged 40 percent and we had to slash our production by 50 percent. We struggled with monthly deficits of tens of millions of yen. However, I saw the crisis as an opportunity to reorganize our production lines from the ground up.

At that time, we were manufacturing a certain amount of products in advance by predicting the orders we would receive. We called it lot production. I changed this to a made-to-order system.

Under the previous system, whenever we received an unexpected custom order, we had to prioritize it and remove products already being made from the manufacturing line. After finishing the custom order, we spent additional time and labor putting the products we had removed back on the line.

However, it was no easy task to convince employees who had been working at the factories for decades to switch to the new system.

As general manager of the production division, I visited factories and told the employees that I would like to run the factory like a ramen noodle restaurant. I explained that, “What you have been doing is cooking 10 bowls each of miso, soy-sauce and salt-based ramen before customers actually stop by. The noodles are getting soggy and losing flavor before they’re even served to customers.”

In the end, I said: “I am not asking you to launch a rocket to the moon. If you give it a serious try, I’m sure you can do it within a year.” They were eventually persuaded to accept my proposal.

Today, employees at one factory have improved efficiency so much that they have reduced the time needed to make a single product from 40 minutes to 10.

I believe most things can be accomplished by giving employees a clear-cut goal and mobilizing them as a team to consider the best approach to it.

Overseas market key

[Rakuten, Inc.’s Chairman and President Hiroshi Mikitani is one of Okamura’s customers. He praised the company’s office desk line-up, called Swift, and decided to introduce the desks for all Rakuten employees.]

Seven-Eleven Japan’s coffee has answered the demands of customers. Even though coffee is sold everywhere, I think the convenience store chain’s product has become a best-seller because it presented a new type of service to customers — the ability to buy a freshly ground cup of takeout coffee for ¥100.

We added the concept of a healthier work environment to the Swift product range. The height-adjustable tables allow users to use them while standing. Constantly sitting at the workplace causes poor blood circulation and may cause the legs to swell. Using desks of a uniform height irrespective of physical differences forces some workers to sit in an unnatural position and causes them discomfort. Although Swift products, which are electric-powered, cost almost twice as much as conventional desks, many clients have chosen the product line.

The bottom line is that we should actually create original products and services rather than simply emphasize how they are different from those of other companies.

Every track-and-field record is destined to be broken no matter how fast a record holder runs. Even if we are currently leading in products and services, somebody will catch up with us sooner or later, and the lead will be gone.

However, a company that delivers a product with an original concept will be hard to overtake. We have to constantly work to achieve originality in our products.

[While Okamura has enjoyed good business, overseas expansion remains a challenge for management.]

The point is how to pave the way to further growth.

Our core businesses like office furniture are expected to grow for the time being, but Japan’s population continues to decrease. When we look overseas, we see the market for office furniture in the United States, for instance, is huge — five or six times bigger than Japan’s.

I would like to steadily expand our business in the United States, Southeast Asia and other parts of the Asia and Oceania region. However, it took Toyota Motor Corp. decades to sell more than 2 million vehicles annually in the U.S. market.

How do we secure a bridgehead in the foreign market and expand our presence there? I believe that will be a crucial challenge for us.

■Masayuki Nakamura / President of Okamura Corporation

Nakamura joined the company in 1973 after graduating from Waseda University. After assuming positions including director of the company in 1996 and senior managing director of the production division, he took up his current post in 2012. Nakamura also serves as a director of the Japan Office Institutional Furniture Association.

■Key Numbers

¥15.2 billion

Okamura has made improving the workplace environment the core of its business, and has increased its revenue by meeting new demand created by work style reforms and making labor-saving investments. The company has set a record target of ¥15.2 billion in consolidated ordinary income in its financial year ending March 2020, the final year of its midterm management plan. According to the consolidated financial results for the fiscal year ending March 2019, its consolidated net sales were ¥247.9 billion. The number of group employees was 4,987 as of the end of March. Founded in 1945.Speech

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