April 30, 2009,17:03 +0900(JST) Joint conference on safety, environment, quality and clerical work quality

At every opportunity, I try to impress on people in the Group the vital importance of "S-E-Q-C-D-D," Safety, Environment, Quality, Cost, Delivery and Development, for a manufacturing company. "S-E-Q-C-D-D" is in fact what makes or breaks a manufacturing company.

To improve our organization in terms of "S-E-Q-C-D-D," I strongly believe it is crucial to maintain close communication among respective divisions: such as Manufacturing, R&D, Sales and Corporate Staff Groups, share information concerning their various challenges and problems, make efforts and work together toward the common goal of finding optimal solutions. Accordingly, since I assumed the office of President, we have held a company-wide joint conference on safety, environment, quality and clerical work quality twice a year, in spring and autumn.

The other day we held the 11th conference at Itami Works. It included a review of activities during FY 2008 by the respective groups, and statements of resolution for FY 2009 policy by the group representatives. The conference enabled the whole company to share information including the year's action policy and plans, and to exchange ideas and opinions.

Since it was already the 11th conference, the respective groups demonstrated improvement in their preparation and participation, as well as in actual positive results from their activities. Nevertheless, considering our ultimate goals for safety and quality, "zero" accidents and defects, we know we must always continue working on those themes, and that it is therefore necessary to carry out campaigns on those themes in a repeated, yet refreshed manner each time, so that the entire endeavor will not become merely rote effort.

To speak in somewhat abstract terms, we must approach those themes of improvement from both theoretical and practical aspects. We must first look closely into theoretical principles, then translate them into concrete, effective and practicable methods. To make sure that these methods are carried out with perseverance, repeated education and training are needed, in order to develop an appropriate mental attitude among the personnel that will govern their practice. As well, strong leadership from top management is essential.

The conference also covered our environmental activities. There were reports regarding the status of major activities including energy conservation, promotion of “Zero Emissions” and chemical substance control, as well as thorough control systems emplaced in response to the RoHS Directive (EU Directive on Restriction of Hazardous Substances) and REACH (EU Regulation on the Registration, Evaluation, Authorization and Restriction of Chemicals). I hope that all group members will continue their efforts in this domain, while always maintaining its high standards and goals, as environmental issues continue to gain importance in society.

As for clerical work quality, reports were given at the conference regarding efforts toward clerical error elimination and cost reduction. With staff members making proposals for improvement activities and directly engaging in such activities on a day-to-day basis, positive changes are being realized through the compilation of working documents, BR and other manuals, solidification of the clerical work foundation and so forth.

Having listened to all the reports, I was once again reminded that the company is supported by small but consistent daily efforts by every single staff member. I was deeply touched by the reports and presentations, which reflected the sincerity of Sumitomo Electric people's commitment to their work. The conference turned out to be a great day of inspiration and encouragement for me.

After the conference, which concluded on a positive note despite the ongoing and extremely severe socioeconomic situation, I felt I understood the meaning of those words of Saicho, the founder of Tendai Sect Buddhism: "Those who illuminate a small corner of society are truly a treasure of the nation."

April 28, 2009,13:15 +0900(JST) The 318th US Forum

The other day I served as a lecturer at an external seminar, the 318th US Forum. Inaugurated in 1984, the US Forum has had many political and business leaders as speakers, some of whom I know very well. Mr. Masao Kamei, former Sumitomo Electric President, spoke at the US Forum once, and Mr. Tetsuro Kawakami, another former Sumitomo Electric President, spoke there twice. As for myself, I was asked to speak by the president of a company we do business with. I accepted gladly, appreciating the fact that the US Forum's objectives are to foster future political and business leaders, networking and forming an influential group of change agents.

US ForumSince I had been told that I could speak freely and without formality, I talked for about one hour in a frank and relaxed manner, on the theme "My thoughts amid the current major recession -- having overcome several recessions." I started by relating memories from the years of my overseas posts, referring to the quintessence of Sumitomo's Business Spirit of doing your sincere best-- not just in business, but in every aspect of your life, as well as Sumitomo Electric Group's new mid-term business plan "VISION 2012," the importance of human resource development as the basis of business management, structural reforms during the past recessions and the three Group-wide principles we have adopted to overcome the ongoing recession: "keeping our organizations to our abilities and reconstructing our cost system," "expanded and deeper internal solidification" and "educational rearmament." In a relaxed atmosphere, I also referred to what I have cared about as President.

As a lecturerHere, I'd like to tell you one thing that had a particular impact on the audience: the importance of diversification based on solid, fundamental organizational identity, rather than excessive selection and concentration, although it is always difficult to keep your balance between the two options in business management. It went like this:

A little while ago, "selection and concentration" became a buzzword, but I feel that many companies that embraced this approach did not fare very well, after all. Mr. Kazue Kitagawa, who was Sumitomo Electric's President, with seven generations of successors before me, pursued diversification, believing in its importance. That was before I joined Sumitomo Electric. Thanks to Mr. Kitagawa's insight, Sumitomo Electric started with power cables, expanded to communication cables and optical fiber cables, and diversified into automotive components, riding the tides of the times to our advantage. It is extremely important for a company to decide how to secure its future and how to diversify in the most suitable ways, with a clear future vision. At the moment, however, we are in a dark tunnel of recession, with no exit in sight. It is too early to launch on a full-scale superconducting technology project. In times like these, it is most important to develop human resources, because they are the source of competitiveness.

Participants in the US Forum were mostly executives and managers from political and business fields who came voluntarily or at the recommendation of their organizations. After the talk, I received many questions from the audience and engaged in active exchange answering their questions.

Finally, let me give you a little "sequel" to the US Forum. I was curious to know if my talk had been appreciated in any way by the audience of some 130 persons. Last weekend, I received feedback in the form of questionnaire sheets, plus handwritten thank-you notes from many of them. Reading them, I felt very happy that my talk had been useful to them. I would like to express my appreciation for their kind words, by sending them my best wishes for their success.
Let's hang on, together!

April 21, 2009,09:35 +0900(JST) Future automobiles at this major turning point for the auto industry

Superconducting electric carWhat will the future hold for automobiles? For the auto industry, worldwide market expansion seems as though it will continue for some time, particularly in newly emerging economies such as China and India. As for automobile models, the presently widespread gasoline-fueled vehicles are likely to slowly give way to hybrid vehicles (HV), electric vehicles (EV), vehicles that run on hydrogen-powered fuel cells and other next-generation automobiles with less carbon dioxide emissions or environmental pollutants.

When automobiles first appeared, HV and EV, along with steam-run vehicles, vied with each other as representative automobiles. At the outset of the 20th century, those vehicles disappeared from the mainstream when the gasoline engine rapidly developed and became popular. Today, a century later, they're back in the spotlight as the world's global environmental consciousness has awakened and governments adopt a so-called "green new deal" policy to counter the financial crisis and the worldwide recession. The auto industry seems to be at a major turning point.

Before electric automobiles become the mainstay in our society, many obstacles remain to be overcome: cost, mileage, cell life, recharging time, recharging infrastructure development and so on. Therefore, EVs are unlikely to replace gasoline-fueled automobiles in the immediate future. Meanwhile, the number of HVs and EVs in circulation is sure to increase gradually, and environmental adjustments - including the realization of greater fuel efficiency as a result of weight reduction and the development of easier-to-recycle design and materials - are expected to accelerate, facilitating the introduction of such new vehicles.

A clear future vision of the automobile is a key to future growth and development for Sumitomo Electric Group, since our mid-term business plan VISION 2012 describes, as one of our goals, the balanced development of five business sectors: “Automotive,” “Electric Wire & Cable, Energy,” “Information & Communications,” “Electronics,” and “Industrial Materials.”

According to the results of a survey on technological tendencies in patent applications announced by Japan Patent Office, Japan accounts for 70% of patent applications in the category of "electric vehicle technology," which concerns next-generation automobile technologies such as EV and HV, a percentage overwhelmingly higher than any other country's.

Sumitomo Electric Group submits over 3,000 patent applications in Japan each year, about 40% of which relate to automobiles (our classification doesn't exactly correspond to that of the Patent Office, however). We constantly pursue active information exchange with auto makers, for mutual technological promotion and stimulation. Under the current severe economic conditions, it is particularly vital to continue research and development for future new technologies and products. That's why I encourage our R&D people to continue doing their best, so that new products that excel the products of other companies can be developed in the domain of next-generation automobiles, through the effect of synergy of the five sectors.

We're also focusing our efforts on developing superconductive technology for application to automobiles and other means of transportation. The photo shows a prototype automobile equipped with a superconducting motor we manufactured last year. It will take some time before this model can be put to practical use, so our hard work continues.

April 9, 2009,13:19 +0900(JST) Inari Festival at Itami Works

To mark the anniversary of Sumitomo Electric's founding, we celebrated the Inari Festival last Sunday at our three Works: Itami, Osaka and Yokohama. This year I participated in the festivities at Itami Works, where I began my life as a working adult and was stationed the longest, and to which I feel particularly attached.

Praying for safetyAt nine in the morning about 100 executives gathered at the Inari Shrine erected on the premises of Itami Works, for a Shinto ceremony. We had asked Chief Priest Kishida of the nearby Higashiten Shrine to preside over the ceremony, in which the attendants offered prayers for safety and prosperity during the New Year, amid solemn music performed on the traditional musical instruments sho, ryuteki and hichiriki, and drums.

The Inari Festival at Itami attracted about 1,600 persons in total, including Sumitomo Electric employees and their families, local residents and retired former Sumitomo Electric employees. Fully blooming cherry trees on the premises and the fine weather rendered the Inari Festival a very lively and cheerful event.

Cherry trees in full blossomThe Shinto ceremony was followed by various games and attractions on the site. We had the pleasure of listening to a performance by the Itami Municipal Nishi Junior High School brass band, which greatly energized the festive atmosphere. Then an inter-departmental softball tournament drew spirited cheers from the spectators. The research team won; I hope their victory will also have a positive impact on their work performance.

Children also had a lot of fun. Thanks to generous cooperation from Itami Fire Station, the fire engine nicknamed "119-chan" and fireproof clothing for children were displayed, and peep-through character panels were set up. The rice-pounding for children attracted over 300 participants.

A charity bazaar was also held; the sale of goods brought in by Sumitomo Electric and its employees raised about 30,000 yen, which we intend to donate to the Council of Social Welfare in Itami.

Children taking part in rice-poundingAs for myself, after the Shinto ceremony I spent some time looking at food and beverage stalls and then went straight to the party area to renew my friendship with retired former Sumitomo Electric employees. I felt truly happy to see them for the first time after a long while, and to learn that they were enjoying their post-retirement days in good health and spirits. Unfortunately, I was not able to take part in almost any of the outdoor games, but I received a gift of rice cakes flavored with sweet adzuki beans and toasted soybean flour, to take home.

The day of the Inari Festival, a precious time of prayers for good health during this year and of pleasant encounters with Sumitomo Electric employees and their families, as well with smiling local residents, re-energized me and filled me with enthusiasm for my work. I look forward to seeing them again next year.

April 6, 2009,09:15 +0900(JST) Welcoming new Sumitomo Electric members

On April 1, we held the annual company entrance ceremony at the Head Office in Osaka. This year 305 new employees, including mid-career recruits, joined Sumitomo Electric Group.

As part of the solemn ceremony, the staff from HR & Administration Dept. called out the names of the new recruits one by one, each one standing and responding in a spirited manner. As I saw their faces-some nervous, some hopeful-I was reminded of my own first day at the company, 42 years ago. At the same time, I was filled with the joy of welcoming new members and of great expectations for the future. I also reaffirmed the president’s heavy responsibility of accepting these people and of managing precious manpower.

Scene from the entrance ceremonyThe new recruits are recent graduates from Japanese and foreign high schools and universities, including non-Japanese graduates of Japanese universities. Together they represent a rich diversity of personalities, knowledge, expertise and specialization. They are all Sumitomo Electric Group’s rookies full of hopes, dreams and motivation. I sincerely hope that they will make the most of their individual strengths and of all they have acquired thus far, and improve themselves further through daily effort.

During the ceremony, I made three requests to the new members as a way of expressing my expectations of them and offering them my encouragement. These requests are the same ones I always repeat in front of Sumitomo Electric people, whether at an entrance ceremony or other event. The three requests represent the fundamentals for all members of Sumitomo Electric Group, not just new recruits:

1. Master the basics of your work, and do your work conscientiously.
2. Strive to improve and develop yourselves constantly.
3. Take great care of your communication with others.

I would like to send my very best wishes to all the new members of Sumitomo Electric Group, who have just begun a new chapter in their lives. Please take good care of yourselves. May your working life in our group be a wonderful and rewarding one. Congratulations on your employment, and my warm welcome to Sumitomo Electric!

SUMITOMO ELECTRIC President CEO Masayoshi Matsumoto

Born in 1944 in Hyogo Prefecture, Masayoshi Matsumoto joined Sumitomo Electric in 1967. After serving as General Manager of Chubu District Office, Managing Director and Senior Managing Director, he assumed office of President and CEO in June 2004.

His leisure activities include jogging, reading and art appreciation. Also a seasoned athlete, he played baseball in junior high school and practiced judo in senior high school. In university, he threw the javelin competitively and participated in all-Japan inter-university competitions.

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