Career paths

Pioneer Cultivating Business Foundation for the Chinese Market

I entered the Daikin Group as a mid-career hire after working for another Japanese company in Shanghai. To be honest, I wasn’t completely satisfied with my job responsibilities at the other company. Daikin told me I would be its trailblazer in China and entrusted me with building the foundation for the Chinese market. Preparations began with establishment of a Daikin factory in Shanghai, and this led to other tasks such as developing a sales network, opening sales channels for imported products, and publicizing Daikin product seminars. Air conditioning products were just entering China in 1994. The only types of air conditioning seen at that time were central type air conditioning, represented by chillers, and split type air conditioning, represented by room air conditioners and floor-standing type packaged air conditioners. But Daikin is truly one of those rare pioneering companies that think outside the box. To this market, Daikin would advance with its VRV system and ceiling mounted cassette type air conditioners. At first glance, marketing this completely unprecedented type of air conditioning to the Chinese market seemed ludicrous but it wasn’t long before what Daikin calls its VRV system simply became known by the Daikin brand name.

Another example of thinking outside the box was Daikin’s choice for local joint venture company. Daikin teamed with a Chinese company involved in a completely different business. This also proved successful. Free to focus on sales, our Chinese business partner at the time became one of the strongest sales organizations in the Chinese market and helped us create separation from rival Japanese companies. Cutting your own path is hard and much is learned by trial-and-error, but the path you clear for yourself creates enormous opportunities for you later. Conversely, traveling the path cleared by others limits you to always following in their steps with little opportunity to pull ahead.

Transforming a Failing Company to Become a Dynamic Group

To transform an organization, you must first be willing to transform yourself. I came in with talent and experience but Daikin saw even greater potential in me than I saw in myself. Not only did the company train me in the air conditioning business, it also provided me an education in management through its Daikin Business School program. There I could further deepen my understanding of Daikin’s entirely unique management style of People-Centered Management through discussions with fellow colleagues at other Daikin Group companies.

I became responsible for the mission to extend the reach of Daikin products in the South China Region, which included the provinces of Guangdong, Fujian, Yunnan, Hainan, and Guizhou, and the Guangxi Zhuang Autonomous Region. Even while being engaged in market development that began from market surveys and creation of sales and service networks, I was also at work promoting M&A.

Prior to leaving for my new post, Guangzhou Daikin had been an unprofitable sales subsidiary running a deficit, and the morale of its employees and sales distributors had fallen. To raise enthusiasm, I wholeheartedly adopted Chairman Inoue’s People-Centered Management and introduced a system to actively reward and promote employees based on their results. Upon doing so, the sparkle began returning to the eyes of our employees, and in only nine months we erased the deficit.

Revenue and profits have increased for 12 consecutive years since then, and operations have expanded from 40 employees to 450 employees with sales having increased by 44 times of the amount when I started. Not only did these results improve, but employees and managers also began feeling a sense of belonging, and it gave us great confidence. Thus, the company achieved a remarkable transformation to become a dynamic group.

Success by People-Centered Management for the Next Reform

The next reform occurred in year 2009. The place was Daikin China - Wuhan Branch, whose territory was the vast Midwestern area occupying approximately half of China. Results exhibited by the subsidiary indicated stagnant growth, and contact with headquarters had become infrequent. I dispatched five senior managers with proven track records from the sales subsidiary Guangzhou Daikin. Those managers left successful and stable lives in Guangzhou to lend their support as successors of Daikin’s Our Group Philosophy. The managers discontinued all previous methods under a scrap & build approach and built a new organization. In only a little more than five years, the organization had expanded from 50 employees to 350 employees and centered on young employees with an average company work history of three years. Sales also grew five times the amount of what had previously been achieved. I believe this success is due solely to the thorough implementation of People-Centered Management. When People-Centered Management resides in the hearts of all employees, beginning with the senior managers, it flows through the veins of the company to unleash the infinite power of people. That is what led to the growth that has been called a miracle.

Sufficient Room to Grow Even in Mature Markets

The next task concerned the region of Hong Kong and Macau. This region was completely different in that it was a mature market with a high Daikin share. I re-examined sales, distribution, and after sales service in this mature market, narrowed down the strategy to Hong Kong developers with investment capital, and worked to develop market opportunities. Upon taking the post in May 2014, we achieved in half a year a sales increase of 120% over the previous year. I had confidence based on my experience that the Daikin management philosophy would hold true in the capitalism of Hong Kong. Even in mature markets, there is plenty of room for growth. Daikin creates room to grow by capitalizing on territories that are impossible for other companies. The keys for success are to set clear objectives, encourage each employee to be ambitious and dream, and channel the dynamic energy of employees to achieve challenging targets. When implementing People-Centered Management, the question becomes the degree to which the executive genuinely respects his or her employees since those who do not receive respect cannot be expected to return it. The sense of belonging first begins to bear fruit when efforts are made on both sides.

Turning Point

On October 8, 2014, we suffered an unimaginable accident. It occurred in an office building elevator and injured more than 20 employees who were subsequently transported to the hospital. This was nearly one-fourth of our employees and drove Daikin Hong Kong into a predicament. However, the remaining employees rallied to take on the work of the injured employees, and even the slightly-injured employees who were still convalescing at home worked at home to the extent their injuries permitted. At the end of October, we were somehow able to hammer out sales of 148% over the previous year. I was overcome with emotion and moved to tears.

As with the proverb, “adversity strengthens the foundations,” we achieved great results with the unity of all employees pulling together. These results can also be directly attributed to the Daikin management philosophy and the infinite power of people that exceeds the imagination. I would like this Daikin DNA to increasingly spread worldwide by fostering this spirit in the next generation and passing the baton to them to promote around the world. Together with the warmth of the Daikin family, I would like to further enhance the stature of Daikin as the global No. 1 air conditioning company. The only risk we face is forgetting our Daikin DNA. If we continue to be true to our Daikin heritage and have a sense of responsibility and mission, Daikin will continue to sustain its remarkable development and success.