Itochu's Niwa: the Salaryman's Favorite Boss
8, 01. 2005
Uichiro Niwa is chairman of Itochu Corporation, Japan's third-largest trading company. Many working Japanese, particularly salaryman company men and female office workers, empathize with his approach to life and work, and his book Hitowa Shigotode Migakareru (roughly, 'work maketh the man') has sold well since its publication in February 2005 (Bungei Shunju). More than anything else, the secret of his success is probably his clear way of speaking and forward, unabashed manner, attributes seldom seen in a Japanese company president who was formerly a salaryman. As president and now as chairman of Itochu, he continues to commute to work by train, and when the company's numbers are down, he takes responsibility by returning his salary-all of it. This kind of behavior impresses people and strikes a deep chord.
In Japan's corporate culture, where employees are widely expected to do their utmost to be obedient, unobtrusive and yet efficient, a president who behaved like this could be seen as a manipulator trying to increase his popularity, and ridiculed as such even by his own employees. This has not happened with Niwa, probably because he has given great thought to each step he takes, and has been able to justify himself to those scrutinize his words and actions.
60 Books a Year
Uichiro Niwa, Chairman of Itochu Corporation
Niwa is the son of a bookstore owner in Nagoya. He made full use of the opportunities presented by this upbringing, burying himself in books of all genres from early childhood. During his student years and after joining Itochu, it was not unusual for him to read over 150 books a year in slack times, and even when working as Itochu president he digested 60 books a year. It is not clear how he went about his reading, but 150 volumes a year is a lot of books. His pace was three a week: even bearing in mind that half were paperbacks and novels, for 60 years he has been reading at over triple the speed of the average salaryman booklover. Niwa's powers of persuasion clearly owe much to these long years of reading.
Making a Break with the Past
The main reason for the protracted structural recession of the 1990s that followed the collapse of Japan's bubble economy was that over 90% of its major companies could not create a business model geared to the needs of the times. This was partly due to lack of knowledge and ability on the part of regular employees, but the underlying truth was this: confronted with the failures of the past during the great shift to a new business model, top managers became worried that their own superiors, the men who had raised them to their present positions, could end up with egg on their faces. This was a major reason for the reluctance to undertake management reforms in this period.
Niwa read 60 books a year when he was Itochu president
Two other aspects of Niwa's way of doing things deserve special mention. First, he made a clean sweep of Itochu's internal culture. In this, he resembled Carlos Ghosn, the Renault executive who turned around Nissan Motor after becoming its CEO. Second is his focus on human resources. Niwa set up, and himself heads, a "management cram school" for department and section chiefs and the Aoyama Club for core employees. He is also considered to have been very effective in establishing corporate governance and fostering personnel by changing workplace attitudes through ethics campaigns focused on the concepts of fairness, honesty and nobility of lifestyle.
An Approach Molded by 9 Years in the US
A major reason why Niwa thinks and acts very differently to other Japanese business leaders is his 9-year residence in the US. He was mainly responsible for buying soybeans for export to Japan, and tasted both success and failure in this role. Although extremely busy, he trawled New York bookstores and read widely about American life, as well as building up personal relations with many people in all walks of life. He came to understand the American way of thinking, and broadened his own lifestyle, by always engaging meaningfully with partners in business transactions and personal relationships.
BY NAGAHARU HAYABUSA