The Mitsubishi
Monitor talks with Akira Nishikawa, president of
Mitsubishi Materials, a leading manufacturer of semiconductor
materials, nonferrous metals, cement, aluminum cans, and
other products.
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You
became president last year with a mandate to restore Mitsubishi
Materials to a pattern of profitable growth. How are you
progressing in your efforts?
Pretty well. I'm excited at the chance to change our company.
And we expect to double our operating profit in the fiscal
year to March 31, 2001. That reflects strengthening demand
in some of our core markets, including semiconductor materials.
But it also reflects our progress in lowering costs and
raising productivity.
You and your competitors
all have been cutting costs and raising productivity for
years. How do you find new ways to increase your cost competitiveness?
Human creativity is an infinite source of ideas. If you
give people the opportunity to exercise their creativity,
they will respond with improvements, even breakthroughs.
I told our managers to concentrate on improving workplace
efficiency. And they have spared no effort in pursuit of
valuable improvements.
An important vehicle for tapping our people's
creativity is TPM, which stands for Total Productivity Management.
TPM elicits ideas for improvements in work processes from
the people who know best: employees in the workplace. All
employees and managers participate in TPM activities. They
identify problems and devise solutions. And they have generated
some impressive results in the past year .
You have
long years of experience in commodities that fluctuate in
price, such as nonferrous metals. But your growing business
in semiconductor materials exposes you to even sharper fluctuations.
Yes, the semiconductor industry is a
roller coaster. You need to build up sufficient reserves
at the peaks of the demand cycle to carry you through the
stomach-wrenching downturns. We're learning to cope with
the special challenges that we encounter in semiconductors.
Our business in that sector is on the way to becoming a
big contributor to our overall corporate earnings. |
 Your
business spans very different sectors. You handle basic
commodities, such as nonferrous metals; fabricated metal
products, such as hard metal tools, aluminum cans, and copper
lead frame materials for electronic components; energy resources
development; and information technology, such as mobile
Internet systems. How do you manage such diversity?
We have devolved a lot of management authority. In fact,
we have organized our eight operating units as virtual companies.
I tell the managers to shape their operations as if they
were preparing to be spun off as independent businesses.
Spin-offs are a genuine possibility for some of our operations.
Others will remain under our corporate roof. But all our
operations need to be independently competitive in their
industries.
The managers of those operations need to expand
their activity in products and technologies where they assert
a competitive edge. They need to reinforce their presence
in markets where they have the potential to become competitive.
And, yes, they need to withdraw from sectors where our business
has become unviable.
How do you motivate
your managers to make the most of their operation?
Last June, we introduced an executive officer system. I
tell the operating officers that they are on one-year contracts.
If they generate satisfactory results, we'll renew their
contracts under better terms. If they don't generate satisfactory
results, we'll find other officers. We evaluate our managers
each year on the basis of results.
You're serious?
I'm perfectly serious. Our customers depend on us for reliable,
cost- competitive supplies of crucial materials. Our employees
and their families depend on us for their livelihoods. We
have a responsibility to all our stakeholders to manage
our operations efficiently and remain a sound enterprise.
This isn't about profit; it's about fulfilling our fundamental
responsibility as a manufacturer. |
And
that includes environmental care?
It sure does. Our environmental commitment is twofold. We
minimize the environmental impact of our products and operations.
And we develop business in services for maintaining and
even restoring environmental quality.
Removing large amounts of any material from
the earth inevitably affects the environment. You need to
dig limestone, for example, if you want to have cement.
But we have become gentler in our extraction work. We also
reduce our net environmental impact through environmental
"good deeds."
Our cement kilns, for instance, provide clean
disposal for tires that formerly blighted the landscape.
And we have developed applications in metal refining for
automotive shredder residue that formerly went into landfill.
How do
your environmental measures and your other activities mesh
with the efforts of other Mitsubishi companies?
We work with other Mitsubishi
companies in some projects, such as recycling electrical
appliances. But we work mainly on our own. I want to stress,
however, that our environmental stance and our management
stance are very much in line with long-standing Mitsubishi
principles: Do as much good as you can for the community.
And never, ever do any harm.
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