KANSAI's Economy and Industry - Important Potential for Economic Cooperation
Dr. Paul Peyrot, LL.M.
Swiss-Japanese Chamber of Commerce
IIST organized the 40th Leadership Program on 24-28 October 2011. The Program was held in the Kansai region (Osaka, Kobe and Kyoto) with the theme of “KANSAI’s Economy and Industry -Leading New Developments in the 21st Century-” and invited overseas opinion leaders participating from 8 countries. Here is an impression of the program provided by Dr. Paul Peyrot from Switzerland.
Much of the international attention Japan received is focused on Tokyo. To me personally as well, the Kansai region and its vast cultural heritage and economic force and potential were little known. It was therefore with great thankfulness and interest that I accepted the invitation to join the 40th Leadership Program organized by IIST.
Indeed, the program provided a skillfully arranged combination of insights shared by government officials, corporate leaders, researchers, entrepreneurs and artists. Our international group was invited to visit companies small and large, young and centuries old, producing traditional handicrafts and the latest high-tech apparel, using hand work and fully automated production lines. This amazing portfolio of visits we paid showed the broadness and variety of the Kansai economy.
The specific economic features of the Kansai economy were presented to us by Mr. Masahiko Nagao, Director-General of the Kansai Bureau of Economy, Trade and Industry. This was followed by one highlights of the week: the visit to the Sharp Corporation Green Front Sakai factories. When arriving at the location with our bus, I asked myself: Where are the parking lots for all the workers and employees here? The answer became clear on the tour within the production lines: production of both Sharp large-scale flat TV screens and solar panels is fully automatized from the beginning to the end. All processes for this complex production are handled exclusively by advanced robots. Human labor is involved only in the remote steering and controlling of the automated processes. We had the honor to be received by the president of Sharp Corporation, Mr. Mikio Katayama. In an admirably frank and open way he detailed to us the strategy of Sharp Corporation with view of the cut-throat international competition in these two fields (TV screens and solar panels). To me, Sharp in an impressive example on how even an obvious “winner” in its field of competition, using the latest technology in both products and production processes is nowadays still continuously challenged to keep its lead over competitors.
The visit to the Hard Lock Industry Co. Ltd. and its charismatic founder and president, Katsuhiko Wakabayashi, showed us another typical example of the Kansai economy: An SME (Small and Medium Enterprise), which is wholly privately owned, which was built up by its founder who out of an observation of traditional Japanese building techniques (wedges) developed a unique product (Hard Lock Nut) which is of universal use and adds safety at practically no cost to all buildings, structures and machines that use bolts for fixation. Entirely self-made and financed by other own inventions, Mr. Wakabayashi is conquering the world markets -and the space!- with his unique product. In spite of his obvious success, Mr. Wakabayashi has remained modest, curious for new inventions and devoted to developing and marketing products that serve society. Certainly a model entrepreneur and personal good example! Also the visit to Fujikin Industries has given us a lesson in entrepreneurship: an established producer of high tech flow control system which also serves the computer chip industry, Fujikin went through a challenging period and had to be brought back on course by the founders. Since then, the company mascot is the “Daruma”: a sturdy character that symbolizes the vow never ever to give in difficult situations.
Today, Fujikin has expanded globally and has established production sites in USA, Ireland and Vietnam, becoming a truly multinational enterprise while maintaining its roots in Kansai. The tour to Osaka castle was our first exposure to the rich cultural heritage of the Kansai region.
The visit to Sumitomo Precision Products gave us insight into how perfect mastery of mechanical technology can be translated into success in a broad range of products. The range of products goes from micro technology to aerospace parts. The insightful presentation of the chief strategist showed us that internationalization is on the map for many Japanese companies. The government and METI actively encourage companies to search for new markets outside of Japan and to diversify both sales and supply regions. One of my favourites (not only because of the premium Sake we have been offered to taste) is the Kobe Shu-Shin-Kan Brewery: It has been established in 1751 and when I asked Mr. Kubota, the Executive Managing Director, whether the company still had a relationship to the original founding family, he replied that the company is still owned by the same family and that now the 14th generation of the owner’s family is in charge of the company. 260 years and 14 generations of continuous (and successful) ownership by the founding family, isn’t that an incredible fact? Kobe further impressed all of us with its Biomedical Innovation Cluster. Obviously, industry clusters play an all-important and still increasing role in each country’s industry strategy. However experience shows that it is a challenging task for a national government to build a new cluster that actually works and attracts world-wide investments. Japan has managed to do so with the KOBE Biomedical Innovation Cluster: the nucleuses of the Cluster are the first-class hospital and university facilities and the impressive K supercomputer built by the RIKEN Institute. Around these “lighthouses”, an impressive array of private companies has formed a vibrant ecosystem. The cluster’s “touch and feeling” is greatly enhanced by the wonderful, campus ? like location at the Kobe harbour and seashore. The KOBE Biomedical Innovation Cluster is a success story that will serve as a model and blueprint for cluster building worldwide.
The famous Shinkansen train brought our group from Kobe to another “cluster”: Kyoto with its ancient roots and traditions without doubt is a cluster of cultural heritage. Cultural heritage and a people’s sense of history and common roots are primordial for any nation. Kyoto impressed me with the vastness and richness of cultural treasure: not only the famous temples and palaces, but also the traditional quarters of the city, with small wooden houses and the small traditional handicraft manufacturers. An impressive example how ancient traditions can be preserved and brought into the 21st century is the Hiyoshiya Workshop Company: Mr. Kotari Nishibori didn’t want to accept the fact that his father in law was planning to close down the manufacture of traditional wagasa umbrellas. Despite being a government employee without any knowledge and training in handicrafts, he decided to take over and continue the workshop. He taught himself the knowledge and skills necessary to master all the steps in manufacture of the umbrellas and also the commercial skills necessary to run and develop a business. Today he does market his beautiful traditional wagasa umbrellas not only as premium quality and design products in Japan but also internationally, where in an innovative and creative marketing campaign he has attracted much attention in designer and haute couture circles. Also, he has used the timeless elegant and filigran techniques and designs of the wagasa umbrellas to design a new range of products: beautiful lampshades. Seeing the interest that Mr. Nishibori has been able to raise internationally with his distinct traditional Japanese products, I spontaneously asked myself which other such “hidden treasures” of traditional handicraft are waiting in Japan to be made known internationally? I would like very much to see many more such success stories! Another example of a famous ancient craft still being carried out and being cherished by dedicated customers is the Koho studio of traditional Nishiki Weaving: the delicate patterns of the Nishiki woven cloth are made in the little studio on a traditional wooden weaving stool by hand, using only slight help from modern technology. Again an impressive example of dedication to tradition combined with a successful adaptation to modern tastes. It would be completely wrong however, to see Kyoto’s economy as a center of traditional handicrafts: the visit to Shimadzu Corporation impressively proved us otherwise. Shimadzu is a leading manufacturer of medical equipment and analytical instruments, famous for its ground breaking research (Nobel Prizes awarded to Shimadzu’s scientist Koichi Tanaka in 2002). Shimadzu successfully transfers and leverages its scientific know how into high tech products. But as the chief strategist for Shimadzu explained us, scientific and technological leadership in today’s world is not a guarantee for commercial success any more in today global economy: access to international markets and integration into global procurements markets and supply chains have become key factors for continuous success. Shimadzu therefore is currently developing a strategy of controlled and cautious internationalization. The participants in the 40th leadership program will be curious to follow up with Shimadzu and will be glad to welcome them in their home countries! Internationalization is also a hot topic for Shochiku studios, the known movie studio. Long time specialized on the “Samurai” genre, they have embarked on a broadening of both productions and customer base by cooperating with the University and with major international players.
Our last day of the leadership tour brought us nearer to the enourmous cultural heritage of Kyoto: the visits to Ryonanji gardens, the Kinkakuji temple and the Kiyomizudera temple. The number of visitors and the respect shown by the visitors are a vivid testimonial to the connection Japanese people feel to their spiritual roots.
(original article: English)
• The 40th Leadership Program on Japan (FY2011)