Chiba, Japan -- Kirk Nakamura, newly elected president of Matsushita Electric Industrial Co. intends to change the giant manufacturer's corporate culture to make it more aggressive and responsive to industry trends, while making it more visible to consumers worldwide.
Nakamura outlined his management goals and views on the industry during a press conference with American and European journalists visiting the CEATECH 2000 show held at the Makuhari Messe complex, here, this week.
Nakamura, who was chairman/CEO of the company's U.S. operation in the early '90s, took the reigns of the $68 billion dollar electronics giant in June. Matsushita markets the Panasonic, Technics and Quasar brands in the United States. He said one of his main goals was to "change the corporate management culture" and follow the "Five S's," the core of his management philosophy: speed, simplicity, strategy, sincerity, and "smile, because I haven't done that often enough in my career."
Specifically, Nakamura looks to change the pyramid structure of the company, where decisions flow from the top down and where management is separated from consumers, slowing reaction time to industry trends. "In that way we can't stay competitive." He is advocating for Matsushita a "flat and web structure" where decision making power is delegated "to the people in the front lines" who have close relationships with the market.
In this vein, he was asked about the company's consumer electronics and computer businesses, which to the marketplace, have separate approaches and operations. Nakamura volunteered that in the United States, for instance, "there is high saturation of PCs, but in digital TV and digital cellular phones, acceptance is not high as yet. Once there is high acceptance in all those areas there could be more [synergy] between those areas," which could give the company a more unified strategy between the two areas in the future.
The development of "cutting-edge digital technology" is at the core of the company's growth. Nakamura said that in "an age of fierce competition and new technology, it is tough to differentiate" products between competitors, "yet it is important to do so." One way Matsushita is different from many, he said, is its financial clout to devote resources to new technology. "To develop DTV set-top boxes it takes a $300 million investment. Some companies can't do that. We can, and we would like to work with other companies and build such products for them."
Nakamura cited the following areas as key ones for growth:
*DVD in all its forms, which will be a $3 billion dollar business for Matsushita this year.
*SD memory card-based products.
*Digital TV, with the coming of DBS broadcasts in Japan on Dec. 1, and high-definition displays for the domestic and U.S. markets.
*And mobile phones, such as DoKoMo units, which Matsushita manufactures for that company. Nakamura estimated the mobile phone market at 400 million units worldwide this year and 550 million during 2001.
Nakamura added that Internet access through mobile phones, PDAs, TVs and computers will provide the industry and consumers with an "ePlatform" in the near future that will drive growth.
In discussing the Web, Nakamura said that in Japan, Matsushita has begun to sell products on a site called LifeVit.com and is offering high-speed Internet connections for video and audio applications called HiHo. He noted that
Matsushita's Internet presence will "spread all over the world."
When asked how this would apply to e-commerce, Nakamura estimated that in five years or so 5 percent of retail sales will be done online, but that "certain products will do better [online] than others" and that traditional retail sales will not get hurt by the phenomenon.
With the change to digital products and the opportunities for revenue through content and services, Matsushita's role is changing, Nakamura said, but he still sees manufacturing as what the company does best: "With digital networking, the boundaries between manufacturing and service providers or content providers are blurred. We must collaborate with content and service providers, with other companies and other industries" for further growth. "We will partner aggressively . [and create] "partnerships with broadcasting and communications companies."