NTT Data Archives - Rudlin Consulting

Why work for a Japanese company? (#1) Corporate Social Responsibility

For most Japanese companies, despite recent changes to corporate governance and the occasional scandal, the main motivation is the long term survival of the firm, not shareholder value maximisation.

Obviously you have to make some money to invest back into the company to survive, but above all longevity means being a good citizen in the environment and communities you operate in. There are some exceptions to this of course, but by and large, Japanese companies are pretty sincere about corporate social responsibility, to the point where I used to joke when I worked in corporate communications in a Japanese IT company, that if we didn’t watch out, our mission statement would be identical to every other Japanese technology company’s mission statement as it could be summarised as “contributing to society through innovation”.

So if you are looking to work for a company that will be supportive of your wish to make a positive contribution to society, then you may find Japanese companies congenial places to work.

Some are more active in CSR than others, so when Toyo Keizai has published its latest rankings by industry, we matched these to our Top 30 Europe, UK and Germany largest Japanese employers rankings and put them in rank order as below.

As Toyo Keizai points out, it is easier for manufacturers to score highly in their CSR rankings, which is why they dominate the top 50 overall, and also why Toyo Keizai publishes rankings by industry, to ensure like for like comparisons are made. Banking and financial services are not included in their analysis. Toyo Keizai explains its scoring system (in Japanese) here. It has around 150 criteria, across the categories of diversity (gender, age, disability), environment, corporate governance and social contribution.

Fujifilm – #1 overall and #1 in pulp/paper/chemicals
Canon #4 overall and #1 in electronics and fine engineering
Denso #8 overall and #1 in automotive
Ricoh #9 overall and #3 in electronics and fine engineering
Konica Minolta #12 overall and #4 in electronics and fine engineering
Honda #14 overall and #2 in automotive
Nissan #17 overall and #3 in automotive
Daiichi Sankyo #25 overall and #1 in pharmaceuticals
Toyota #28 overall and #4 in automotive
Fujitsu #30 overall and #9 in electronics and fine engineering
Astellas #34 overall and #2 in pharmaceuticals
Sumitomo Rubber 36th overall and #2 in oil/rubber/glass/ceramics
Mitsubishi Corporation #42 overall and #1 among trading companies
Lixil 44th overall and #1 in metal products
Sony #45 overall and #12 in electronics and fine engineering
Nidec #49 overall and #13 in electronics and fine engineering
Takeda #50 overall and #4 in pharmaceuticals
Sumitomo Electric Industries #52 overall and #2 in metal products
Itochu #55 overall and #2 among trading companies
Panasonic #57 overall and #15 in electronics and fine engineering
NYK #58 overall and #1 in logistics
Japan Tobacco 60th overall, 3rd amongst food companies
Brother Industries #71 overall and #16 in electronics and fine engineering
Sumitomo Corporation – #73 overall and #3 amongst trading companies
NTT Data #75 overall and #4 in telecommunications
Olympus #84 overall and #17 in electronics and fine engineering
Dentsu #95 overall and #2 out of service sector companies
Sumitomo Heavy Industries #138 overall and #11 amongst machinery companies
Calsonic Kansei #138 overall and #18 in automotive
Fast Retailing (Uniqlo) #531 overall and #19 out of 20 amongst retailers

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Top 30 Japanese employers in Germany in 2017 includes Takata at #3 – who’s about to become Chinese…

The bankruptcy of Takata and acquisition of its assets and operations by a Chinese owned US based company Key Safety Systems is not perhaps the most auspicious moment to announce our new Top 30 Japanese employers in Germany – where Takata, for the time being, is at #3. Its substantial presence in Germany (in contrast to the UK, where it has no operations at all) is due to the acquisition of Petri AG in 2000.

Another Japanese company which should perhaps be classified as Chinese (or rather, Taiwanese) is Sharp. Since Hon Hai/Foxconn’s acquisition, Sharp has radically reorganised itself in Europe. There is Sharp Devices Europe, headquartered in Munich, with what was Sharp Laboratories and is now renamed a Design Centre in Oxford UK and Sharp Business Systems Europe, headquartered in the UK along with the Information Systems unit, with Visual Solutions in Munich and Energy Solutions in Hamburg. Sharp Telecommunications in the UK is being closed down. Sharp’s white goods brand (microwaves etc) is now under license to the Turkish company Vestel but there was a rumour last year that Sharp under Foxconn wanted to buy the brand back.

Many of the other large Japanese companies in Germany are also the result of acquisitions, like Takata – Musashi Seimitsu acquired Johann Hay in 2006, Lixil acquired Grohe/Josef Gartner 2011-2013, Panasonic acquiring Vossloh in 2000 etc.

Comparing to the UK Top 30 – there are some similarities – Fujitsu at the top and Sony, Ricoh, Canon, JTI and Hitachi all featuring. No doubt the list will be revised as we uncover more companies, but it does seem that there are not quite so many employees per large company in Germany as there are in the UK. This might be partly to do with the car factories – Honda, Nissan and Toyota and their associated suppliers in the UK – and also the trading companies such as Itochu, Sumitomo Corporation and Mitsubishi Corporation have acquired larger companies in the UK than they have in Germany.

Rank	Company	Germany employees 2016
1	Fujitsu	5,000
2	Sharp	4,226
3	Takata	3,311
4	Lixil	3,200
5	Musashi Seimitsu	3,140
6	Panasonic	2,935
7	Olympus	2,573
8	NSG Pilkington	2,500
9	Konica Minolta	2,399
10	NTT Data	2,300
11	Canon	1,842
12	Ricoh	1,804
13	Daiichi Sankyo	1,705
14	JT International	1,699
15	Nidec	1,394
16	Sumitomo Heavy Industries	1,386
17	Sony	1,372
18	Mitsubishi Hitachi Power Systems	1,352
19	Toshiba	1,287
20	Yaskawa	1,281
21	Takeda	1,262
22	Astellas	1,037
23	Toyoda Gosei	1,034
24	ARRK	955
25	Nintendo	900
26	Nissan	835
27	Renesas	831
28	Toyota Industries	830
29	Hosokawa Micron	760
30	Hitachi	742
TOTAL		55,892

For a 2022 Top 30 Japanese companies in Germany, see our blog post here.

Fewer women on the boards of Japanese companies in Europe than in Japan

We’ve revised our Top 30 Japanese companies in Europe again. Where possible we have updated the number of employees, which means the Suntory Group is now in the Top 30 along with Konica Minolta (and Kao and Daiichi Sankyo are out). This time we wanted to take a look at the gender and nationality diversity on boards, both in Japan and Europe, and have discovered that there are actually fewer women on the boards of Japanese companies in Europe than in Japan.

Only two out of 19 (10%) of European headquarter boards of Japanese companies have women on them – Astellas and Suntory (the latter including Makiko Ono, an executive in Suntory Japan) and only 3 of the 14 (21%) UK based Japanese companies we looked at (in cases where the European HQ was not in the UK or there were separate European and UK companies in the UK) had women members – Lucite (subsidiary of Mitsubishi Chemical Holding/Mitsubishi Rayon), Komatsu and NTT Data. Komatsu UK’s female director is Keiko Fujiwara, who is the CEO of Komatsu Europe, in Belgium. This contrasts with 13 (43%) out of the Top 30 companies’ boards in Japan having women directors. In case you were wondering, only 6% of FTSE250 companies have no women on them.

4% of the Top 30 Japanese companies in Europe’s board members in Europe and/or the UK are female
6% of the Top 30 Japanese companies in Europe’s board members in Japan are female
8% of the Top 30 Japanese companies in Europe’s board members in Japan are non-Japanese
16% of the board members of the Top 100 listed Japanese companies in Japan are female
19.6% of FTSE250 board members are female

Around 62% of the members of European and UK boards of of the Top 30 Japanese companies are European, on average. Companies whose boards in the UK and Europe only had Japanese directors were Toshiba, Fast Retailing (Uniqlo), Fujifilm and Sharp. Sharp and Toshiba’s troubles are well known. Fast Retailing recently reported struggles in the US market and falling profits in Europe for Uniqlo, Comptoir des Cotonniers and Princess Tam Tam. Fujifilm has made a remarkable transformation from a B2C camera film to a B2B imaging company but the last set of quarterly results, issued last month were deemed “mixed”.

(Note: only main boards, not executive or supervisory boards were analysed, and company secretaries were excluded)

The full chart is here (highlighted means “above average) and can be downloaded here :Top 30 Japanese companies in Europe board diversity Nov 3 2015

The most popular location for a European HQ

I’ve just been updating our Customer Relationship Management (CRM) database of Japanese companies and their suppliers in Europe. I recently shifted the database to a new cloud-based provider, which enables me to cross reference our customer data with social networking sites such as LinkedIn – a very popular business networking site across Europe and the USA. The way our new CRM interface works has also forced me to focus much more on how our Japanese corporate clients are organising their operations across Europe, including where they have placed their headquarters.

My conclusions are not entirely scientific, as my own business is based in the UK and therefore biased towards UK based Japanese companies, but it does seem that the UK is the most popular base for European headquarters of Japanese companies. Of the 96 European headquarter companies I have identified in my database, 53 are in the UK, 24 in Germany, 10 in the Netherlands, 5 in Belgium, 2 in France, 1 in Switzerland and 1 in Poland.

Of course there are many Japanese companies who do not have a European headquarters, but the trend among those who have been in Europe for a longer period is unmistakably towards consolidating across Europe in terms of functional areas such as purchasing or HR or finance. This seems to be to the benefit of the UK, which is the undoubted European if not world capital of professional services – with many globally capable financial, marketing, legal, consulting and HR firms in London.

The UK has long been a favourite destination for Japanese foreign direct investment, for various reasons ranging from the English language, to golf to the UK’s open economy. Germany has also been very popular, particularly with Japanese engineering companies who feel an affinity with German process orientation and risk aversion, as well as having historical ties such as Fujitsu with Siemens or Denso with Bosch. The North Rhine Westphalia region was particularly active since the 1960s in encouraging Japanese companies to set up there, although Sony decided initially to set up in Berlin, largely, it was rumoured, because of Norio Ohga’s love of the Berlin Philharmonic.

More recently, the Netherlands became popular because of the tax advantages offered, and also, along with Belgium, was an obvious logistical centre for Europe. Lately, however, there seems to be a shift of these headquarters to the UK. Canon has moved from the Netherlands to Uxbridge, near London. Denso and Bosch recently announced their break up, and although Denso continues to be headquartered in the Netherlands, there seem to be several senior managers with European roles based in the UK. Fujitsu and Siemens parted ways in 2009, with the Fujitsu European operations being split between Continental Europe, the Nordics, and UK and Ireland.

Sony sold its Berlin headquarter building in 2008 and is currently in the process of consolidating its sales and marketing across Europe, to be based in Weybridge, a few kilometres south west of London. However, it seems to be shifting towards a “virtual” European structure, with shared HR services now set up in Turkey, and individual senior executives with European remits being based in whatever location they prefer. This pattern has also become evident in other IT and telecoms companies such as NTT Data.

Even this virtual European company structure seems to benefit the UK the most, as senior executives of all nationalities are can be found in, or seem relatively happy to relocate to, London and its suburbs. With more than 40% of London’s population were born outside the UK, London has truly become a global capital and a place to develop global careers.

This article by Pernille Rudlin originally appeared in Japanese in the 10th April 2013 edition of Teikoku Databank News and also appears in Pernille Rudlin’s new book “Shinrai: Japanese Corporate Integrity in a Disintegrating Europe” – available as a paperback and Kindle ebook on Amazon.

Interview with Hiroo Unoura, NTT President – the courage to say we are only one of many

As outlined in a previous blog, NTT, the partly state owned Japanese telecoms company, is undergoing a major global shift. Nikkei Business interviewed the president of the NTT group, Hiroo Unoura, about how he has been trying to change NTT since he became president in 2012.

In June 2013 he announced to the top executives of the group companies that “we should not leave any homework for future generations”, by focusing on what kind of services would be needed for the era of cloud computing, and that NTT must no longer regard itself as the main player, but simply “one of them” due to the diversification and globalization of the telecoms services and applications market. He is reshaping the organisation globally, using North America as a starting point for global expansion.

NTT has set up a 100 strong cloud research center in Silicon Valley. Unoura believes that businesses in the USA are far more inclined to see shifting to the cloud as a life or death matter, whereas the Japanese market is still hampered by regulation.

Unoura was involved in cleaning up the mess after the major losses made by NTT in the early 2000s from overseas investments. Those acquisitions were not about increasing turnover, he points out, rather about acquiring 3G technology from AT&T Wireless or building a global internet network in the case of Verio. The current acquisitions are about expanding the business. As Dimension Data is a specialist in cloud, by acquiring them, NTT is hoping they will find further candidates for NTT to acquire in the cloud business.

Acquisitions such as the recent purchase of Spanish IT company Everis are all discussed with NTT overseas operations such as NTT Com, NTT Data and Dimension Data first. However NTT has no intention to abandon Japan – the idea is to learn from overseas, and bring that knowledge back to Japan once Japan’s own industrial structure has changed.

NTT is of course putting itself into direct competition with the very Japanese companies who used to rely on NTT as a key customer, such as Fujitsu and NEC, by focusing on cloud and global markets. Fujitsu in particular already expanded overseas decades ago through purchases of European and North American companies, although it took many years before it then tried to integrate them into “One Fujitsu”. Time is not on NTT’s side, and trying to integrate strong and distinctive companies such as South African Dimension Data into “One NTT” may need all of Unoura’s apparent boldness and courage and then some to push through.

NTT’s global acquisitions bear fruit

Nikkei Computer magazine has run a 4 part series (articles in Japanese) on whether the formerly domestic oriented telecoms company NTT group can really succeed globally. The answer appears to be yes, in part thanks to its agressive acquisitions over the past few years of Dimension Data, Keane, Centerstance and others. The major question is whether a strong enough leader can be found in Japan to keep the momentum going.

The first part of the series examines NTT’s recent successes in winning deals in the USA – with the Texas Department of Transportation for application maintenance and support involving NTT Data, Dimension Data and MSSP Solutionary (which it acquired last June) and an IT services contract with Yum! Brands (KFC, Taco Bell and Pizza Hut) in Kentucky. Both of these deals involve the transfer of hundreds of employees over to NTT Data, which I imagine will prove quite a challenge for NTT.

An insider says that because NTT is very much seen as a challenger in the North America, this sense of being an outsider has united NTT ‘s various companies to cross sell and bring in deals such as the TDoT and Yum! deals.

The NTT group lost a trillion yen (around $10bn) in the US market a decade or so ago on investments in AT&T Wireless and Verio. In response to the question of why they are trying again now, Tsunehisa Okuno, Director of the Global Business Office at NTT Holdings says that as the USA is the largest and most competitive IT market in the world – “if we can’t succeed there, we will not succeed in globalizing our business. The winner in the cloud market is not decided yet, and North America is the key to that market”. NTT’s intention is to develop its technology and skills in North America, then bring that to Europe, the simplify further and bring to developing markets.

Nikkei Computer highlights three areas of concern for NTT:

1. Developing the strongest services

In particular, NTT need to address the duplication of IaaS and MSS offerings from its subsidiaries NTT Communications, Dimension Data, Solutionary and NTT Security (in Germany) if it is to compete effectively with Amazon, IBM, Dell and Verizon.

2.Standardizing knowhow and methodology

NTT is finding that rolling out what they have developed in Japan as the global standard has not been easy, and instead is now looking to standardize methodologies originating in its overseas subsidiaries.

3. Complex organisational structure

NTT has retained the brands and the founders of the companies it has acquired, believing this to be key to keeping motivation high. However it can lead to lack of oversight and any sense of unity across the group, as well as a very complex organisational structure. NTT Holdings is still over 30% owned by the Japanese government, and there are laws in place preventing anyone of a foreign nationality becoming a director in the holding company.

Up until now NTT has relied on posting a small group of executives across its subsidiaries who knew each other well and had the same vision for NTT – Okuno was from NTT Com, Kazuhiro Nishihata a director at NTT Data also comes from NTT Com and used to be President of NTT Europe. Okuno feels a limit has been reached on this management by jinmyaku (human network) and from now on NTT will have to communicate more based on logic, taking as long as necessary to persuade others.

Takashi Enomoto, former Senior EVP of NTT Data, in charge of overseas business, was very keen that there should be one NTT Data brand, and was able to persuade the founders of acquired companies by pointing out that IBM is IBM, Accenture is only the Accenture brand. A second Enomoto is needed at NTT to ensure the success of its global strategy, says Nikkei Computer.

Last updated by Pernille Rudlin at 2022-06-22.

NTT Data

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