2023 Special Exhibition on the Management Philosophy : Grasping the Knack for Management Is Worth a Million Dollars

Are you operating this equipment effectively to make profits? Here, we introduce an anecdote of a senior associate. He became aware of the founder’s stance of keeping tabs on the use of funds as a proprietor from the look in his eyes while taking him on a factory tour, and later committed himself to making business decisions from a proprietor’s perspective.

In 1977, the Refrigeration Business Division was barely making profits. Concerned about the business division’s management, the founder made frequent visits to the factory, during which Akira Matsuda (later became president of Matsushita Communication Industrial) accompanied him on a factory tour as a plant superintendent. “He (the founder) listened to our presentations very attentively and responded with great enthusiasm as I explained each piece of equipment and machine.”

“However, while I was giving explanations, he occasionally glanced or stared at me with a stern look on his face.” According to Matsuda, the founder continued with his tour while having an occasional look at the plant superintendent. Toward the end of the tour, Matsuda realized, “I see. This is a proprietor’s look. Through his eyes, the founder was communicating and confirming, ‘This equipment and this machine belong to me. I paid for them. Are you properly using and maintaining them? Are you operating them effectively to remain consistently profitable?’”

Although the founder did not make these remarks, Matsuda strongly felt his intentions. At the time, the founder was serving as executive advisor and had already withdrawn from the grind of daily management. Nonetheless, together with the manager, he was conducting onsite checks to confirm whether the funds were effectively used.

“I get it now. This is how a proprietor observes. The founder takes management as his own business. After all, we see equipment and employees as company assets. Instead, it is crucial that we face our work by seeing them as our own assets.” Based on this idea, Matsuda changed his behavior accordingly. For instance, when his subordinate brought an approval request to purchase equipment, he pulled out the actual 10,000 yen bill from his wallet, placed it on the desk to resemble the 10 million yen required to purchase the equipment, and asked them, “Would you pay this amount out of your own pocket to buy this equipment?” “If the plan fails, then the money will be wasted. Even then, would you really be willing to purchase this equipment? If you are trying to coax the company to pay for it, then you still have a lot to learn.”

Matsuda communicated his experience with the founder in the following words, “In a way, this idea shares the same concept as the principle of employee entrepreneurship. I believe that if we consider ourselves as the owner of each of our business activities and engage in work from a president’s or proprietor’s perspective, then we will inevitably become serious about what we do.”

Batteries have supported people’s lives through electricity, and their use has increased with the spread of electrical appliances. To this day, they remain the most accessible and frequently used products on a daily basis and serve as a gateway to our products. It is important that we occasionally renew our awareness of the meaning of these products, as well as the business, and incorporate it in our initiatives.

With the aim of achieving batteries with twice the conventional performance, our company launched a project in 1960 and released National Hi-Top dry batteries in 1963. These high-power batteries could be used in a wider range of products, including shavers and calculators, which were not previously battery-operated, and further accelerated growth in demand.

After receiving the report from the Dry Battery Business Division on the completion of products, the founder immediately confirmed the product at Shinshin-an. Looking at the product with adoring eyes, he thanked the business division’s efforts, “Well done. This is an excellent product.” He continued by saying, “Tens of millions of batteries at a time are released and used by a number of people. They are acting as our business cards representing Matsushita, so to speak. These business cards can make money and even advertise other Matsushita products by demonstrating high performance. We couldn’t ask for a better result. It would cost a fortune to achieve the same amount of advertising by distributing tens of millions of flyers. From this aspect, it is also Matsushita’s best product.”

Masao Funahashi, who was at this meeting and later became senior managing director of Matsushita Battery Industrial, looked back on this occasion in the following words, “It is true that the sales unit prices of batteries do not amount to much. Nevertheless, their quality directly affects the company’s image. I realized their critical role for the first time and felt a keen sense of mission to deliver an appreciable amount of quality batteries to the world.”

Thereafter, the business division engaged in production with due care and attention to quality, with the understanding, “Based on the assumption that we deliver batteries to customers and affiliated retail stores as our business cards, if they are bad business cards with a quality problem, then it will immediately hurt our overall corporate image.” Moreover, in order to drive higher power devices such as radio-cassette recorders, the business division promoted the further development of products and released Neo Hi-Top in 1969.

In the in-house newsletter issued in 1976, Funahashi said, “Hi-Top maintained the same design for 13 years from 1963 and Neo Hi-Top for seven years from 1969. We treasured their designs that much. In terms of prices, since we set the price of Hyper (dry batteries) to 40 yen in 1954, we did not revise it for 20 years. Instead, in factories, we have been making consecutive and painstaking efforts to achieve rationalization.” Batteries have truly played a role as business cards representing the National brand.