Mitsubishi Heavy Industries and Caterpillar established the forerunner of Shin Caterpillar Mitsubishi back in 1963. They set up the company as a 50:50 joint venture, and it has continued to operate under equal ownership. Fifty-fifty joint ventures are notoriously difficult to manage. Why have you been successful?
The people who set up this company were clear about the complementary roles of the parents. Caterpillar would provide the product and manufacturing technology and the expertise in marketing and after-sales service. Mitsubishi Heavy Industries would furnish the administrative and management capabilities essential to operating a manufacturing operation in Japan. We have minimized friction and made the most of our parents' strengths by maintaining that complementarity.   I should mention that Caterpillar and Mitsubishi Heavy Industries are of similar size. Both have annual sales of between $20 billion and $25 billion. Caterpillar, of course, is highly focused, getting about half of its sales from earthmoving equipment. In contrast, Mitsubishi Heavy Industries' sales portfolio spans hundreds of product categories.

What is the division of responsibilities between you [who became president at Shin Caterpillar Mitsubishi after a long career at Mitsubishi Heavy Industries] and the chairman [Stuart Levenick, from Caterpillar]?
We don't divide responsibilities. We are jointly responsible for everything. That might sound like a cumbersome arrangement. But it works well. We discuss all important issues and reach decisions together.
  You will find the same kind of positive interaction among all the American and Japanese members of our management team. I have heard that communication difficulties were part of the company's growing pains in its early years. Apparently, Japanese and American managers sometimes refrained from discussing issues with each other until problems became serious. But people at this company today jump in as soon as potential problems become evident and work out solutions together.

How has Mitsubishi Heavy Industries benefited from this joint venture?
The joint venture has cemented a relationship with a valuable partner. Working with Caterpillar has enabled Mitsubishi Heavy Industries to be part of a larger business in earthmoving equipment than it could have built alone. The name on the equipment is CAT, but a lot of the engines and other core components are from Mitsubishi Heavy Industries. The partnership carries over to a separate joint venture in forklifts, where Mitsubishi Heavy Industries holds a majority interest.

How has Caterpillar benefited from the venture?
The initial benefit was a foothold in the Japanese market. Caterpillar arrived just as the market was entering an extended period of rapid growth. We can only speculate about what they might have been able to accomplish with a majority- or wholly owned operation here. But this 50:50 joint venture unquestionably has built a strong position for CAT in Japan's market for earthmoving equipment. We now account for about 13% of total sales of Caterpillar-brand earthmoving equipment worldwide. That includes our exports, which account for more than one-third of our sales.
  Caterpillar has benefited worldwide from original technology developed at Shin Caterpillar Mitsubishi. Our R&D center in Kobe is Caterpillar's global center for developing small and medium-sized hydraulic excavators. The center also leads a development program for adapting Caterpillar equipment to needs and circumstances in the immensely promising markets of China, India and other Asian nations.

What is your top priority as president?
A big part of my job as president is to encourage people to think. Attitudes toward work are a subset of people's larger value systems. Only when people have a sense of purpose in life can they have a sense of commitment at work. I have begun holding talk sessions with small groups of young managers. We dedicate the sessions to such subjects as life, leadership, culture and values. I feel strongly that a company should be a place where people can discover what they are all about.

What does being a Mitsubishi company mean for your company?
We take pride in the more than 130 years of Mitsubishi history. And we do a lot of business with Mitsubishi companies. Mitsubishi Estate's building projects occasion a lot of demand for our equipment. So do resource development projects coordinated by Mitsubishi Corporation around the world. I already have mentioned the engines that we get from Mitsubishi Heavy Industries. And we also obtain important components and materials from Mitsubishi Motors, Mitsubishi Steel and other Mitsubishi companies.