A few Japanese companies have started shifting the global headquarters of certain business units outside of Japan. For example, Hitachi set up its global rail headquarters in London in 2014 and Terumo, in 2011 moved its blood management and artificial heart businesses to the USA. As the Nikkei Business magazine points out, this was mainly a case of moving certain functions over to acquired companies and did not result in overseas operations embarking on a wholesale restructuring of the business.
In the case of Nidec, however, the acquisition of KB Electronics, based in Florida USA in 2015 was instigated by Nidec Motors Corporation, Nidec’s subsidiary in Missouri USA. NMC was part of Emerson Motors in a previous incarnation. Then Nidec acquired EMG Elettromeccanica in Italy in September 2015 and then acquired a further division of Emerson in August. Again this was instigated by NMC. NMC is now functioning as the core of Nidec’s Appliance, Commercial, Industrial (ACIM) divisional company, headed uip by Kei Pang, the CEO of NMC (who was educated at The King’s School in Ely, UK and has a BA from the University of London, I note).
Nidec rarely despatches more than 2 or 3 people from Japan headquarters as expatriates to overseas operations. Nidec globally is run on a matrix basis, with four Japanese executives in charge of global post merger integration, global business synergy & sales, global purchasing and global technology, running across the five regions of Japan, the USA, EMEA, China and Asia. As the Nikkei says, the matrix is there to intervene as needed with overseas operations. However it can easily lead to conflict. That is where Nagamori-ism – to take up the challenge of high growth and high profitability – should help to reconcile disagreement. It is meant to provide a structure where people can act independently and the organisation and business change accordingly. It’s progressing towards a structure which can survive even if Nagamori has gone.
Nagamori has surrounded himself with talent, and presumably potential successors, from many other Japanese companies, such as Mitsubishi Electric, Nissan, Hitachi, SMBC, Honda and Sharp. In an interview with Nikkei Business he says what’s important is to have a person who can change the company and who has a strong will to grow the business further. He would be willing to pay more than the usual salary Japanese CEOs receive, to compensate for the responsibility for result.
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