September 29, 2011,10:37 +0900(JST) Disaster Preparedness Day

Sumitomo Electric held Group-wide disaster drills at each site on September 1 for Disaster Preparedness Day. We conducted training on evacuation, confirmation of employee safety, information communication and secondary disaster prevention, to verify the adequacy of the initial responses stipulated in our business continuity plan. The event was transmitted by video-conference to each site.

In light of the extent of the damage caused by the tsunami that was triggered by the Great Tohoku Earthquake, local governments in tsunami-prone areas in Japan are re-examining their predictions of the height and possible damage of tsunami. Here in Osaka Prefecture, the height of the tsunami assumed to follow Tonankai (literally Southeast Sea) and Nankai (literally South Sea) earthquakes if they occur in succession is 1.5 to 3 meters. If the Tokai (literally East Sea), Tonankai and Nankai earthquakes occurred in conjunction, some predict that the largest possible tsunami would be six meters high, flooding huge areas, including the central Osaka City.

Sumitomo Electric suffered enormous damage from the Makurazaki Typhoon of 1945 and Typhoon Jane of 1950. While reinforced tidal embankments and other countermeasures have helped reduce damage to coastal areas of Osaka in recent years, these anti-flooding measures seem far from perfect. However, there are limits to what we can do as a company in terms of physical protection measures against tsunami disaster, measures that will involve great expenditures of cost and time. At Sumitomo Electric, we are working to improve our disaster preparedness by reviewing our Business Continuity Plan and by ensuring, on a routine basis, that hazardous areas and evacuation procedures are fully understood by employees, and that evacuation drills are carried out at each work site.

Another major issue in disaster preparedness is to secure backup power, so as to cope with possible interruptions of electric power, gas and other important infrastructure services essential to production. Since the Great Tohoku Earthquake, Sumitomo Electric has increased the number of backup power systems in its facilities in eastern Japan. Over the coming months and years, we will consider where to install such systems, on the basis of the Group’s production and supply structure.

Regarding the crisis at the nuclear power plant, facility aging and the inadequate emergency manual have been pointed out. Coping with aging facilities is also an important task for Sumitomo Electric, a company boasting a long history. Over the last several years, we have carried out seismic reinforcement of our buildings, according to a plan. We will step up our efforts to ensure the seismic safety not only of our buildings, but also of our equipment and facilities.

On this Disaster Preparedness Day, I feel strongly that, by drawing lessons from the earthquake and tsunami disaster that claimed many lives, each and every one of us should think about what we can do and promptly start doing whatever we can.

September 27, 2011,11:04 +0900(JST) Glorious Excellent Company Award Ceremony (for commending Group companies)

Currently, the Sumitomo Electric Group comprises more than 450 companies* and conducts business in over 30 countries around the world. To maintain and enhance the sense of unity and cohesion within the Group, we have taken various measures.

One of these is the Group company award system, commenced in FY 2006. This award will be given to companies in our Group recognized to have achieved excellent results, according to the criteria for evaluating attainment of missions to be fulfilled by Group companies. The purpose of this award is to promote the entire Sumitomo Electric Group to conduct business with an even stronger sense of unity and cohesion, toward achievement of VISION 2012 and the realization of a Glorious Excellent Company.

Although I don’t go into details of the evaluation criteria here, we have established a system to objectively measure a company’s contribution to the entire Group, using various management indicators to express the level of plan achievement by figures. The evaluation criteria have been set up after many discussions among board members. Some elaboration has been added each year, to make the criteria even more reasonable. To become an award-winner it is absolutely essential to excel in safety and compliance.

For FY 2010, which marked the fifth year of the award, 21 companies were recognized. At the end of August, their representatives and top management came to the Company’s Head Office, where the award ceremony and a reward party were held.

With representatives from the two companiesI bestowed certificates of commendation, plates and gifts to the award winners with a sense of gratitude. Reflecting business globalization, of 21 companies receiving the 2011 award, nine were overseas Group companies (in Germany, Italy, China, South Korea, Thailand, and Taiwan).

In addition, the special award was given to two companies that have received the award for four consecutive years—Japan Communication Accessories Manufacturing Co., Ltd. of the Infocommunications & Systems Business Unit, and Hui Zhou Zhurun Wiring Systems Co., Ltd. of the Automotives Business Unit.

I hope that while competing with each other to win next year’s award, respective Group companies will work together step by step to achieve VISION 2012 and the Group’s goal of becoming a Glorious Excellent Company.

* The number includes consolidated and non consolidated subsidiaries, affiliates accounted for under the equity method, non-consolidated subsidiaries not accounted for under the equity method and affiliates not accounted for under the equity method.

September 26, 2011,16:33 +0900(JST) 5th Global Leadership Program (GLP) (2)

In this training session, there were group discussions on the theme: “What can we do in our region and in our work site to sustain the growth of the Sumitomo Electric Group?” Divided into five groups, participants from Japan, China and South Korea spent a total of 13 hours in heart-to-heart discussions and summing up those discussions in proposals. On the third day, as closing presentations, discussion results were reported in the presence of the top executives and general managers.

Presentation by a participantEach group presented concrete, productive proposals and suggestions based on participants’ own experiences and personal views on issues in daily work.
They made proposals regarding: career paths, education and training systems and fringe-benefits and other personnel programs for local employees; ways to motivate local employees, such as sharing information and empowering; and reduction of materials distribution and production costs through automation and systemization by introducing equipment, local procurement and standardization of operations among multiple worksites. In listening to these proposals, I can easily sense the enthusiasm and earnestness of the participants. I also found two common key words underlying all the presentations by the five groups: “globalization” and “diversity.”

These valuable proposals should not be locked away in files. It is important to utilize the ideas brainstormed in this training for the further growth of the Sumitomo Electric Group. In turn, these proposals should be taken seriously by related business units and departments of our head office in Japan, such as HR & Administration, Human Resources Development and Logistics Management Departments, Group Procurement and Plant & Production Systems Engineering Divisions. I hope that these ideas will be steadily put into action one after another, without wasting the enthusiasm of the training participants.

Our future growth depends on whether diversity will be successfully incorporated into various functions of Group companies. I hope that those who have completed the Global Leadership Program will play leading roles at the forefront of this endeavor. I also asked participants to put into action, as soon as they return home, any of the above proposals that can be addressed at their work sites, with the aim of creating a better workplace.

At the convivial party held at a venue in Yodoyabashi, “kanpei” cheers were shouted repeatedly in giving toasts. With the fervor of participants, the midsummer night heated up all the more. The party seemed to help enhance our informal communication as well.

Photos from the party

September 21, 2011,13:10 +0900(JST) 5th Global Leadership Program (GLP) (1)

At the Global Leadership Program, I delivered a lecture and attended a closing presentation session and subsequent convivial party. This is the second training session since the global management training program for non-Japanese executives of overseas Group companies was renewed so as to include Japanese administrative members. This time around, participants comprised 32 management personnel from Japan, China and South Korea.

 The four-day program included a lecture by the top executive, a series of lectures on the medium-term management plan, global human resources strategy, compliance and other issues, visits to Osaka Works and facilities associated with Sumitomo and group discussions-an essential part of the training program.

On the first day, participants gathered in the Company’s head office (Osaka), where the training program opened with the top executive’s speech. I talked for about half an hour on the Sumitomo Spirit, which serves as the basis for our business management, and what I expect of leaders.

Seven years ago, I assumed the presidency of Sumitomo Electric and established SEI University. A textbook was also created at my order to summarize Sumitomo Electric Group’s corporate philosophy and fundamental values. Using this textbook, I gave a lecture with focus on the key concepts of “Banji-nissei (do your sincere best, not only in business, but also in every aspect of your life),” “Sinyo-kakujitsu (place importance on integrity and sound management),” “Fusu-furi (do not act rashly or carelessly in pursuit of easy gains)” and other traditional principles, such as “attaching importance to technology,” “respect for human resources,” “long-term planning” and “mutual prosperity, respect for the public good.”

In addition, I noted that leaders are expected to honor “noblesse oblige,” which means one must act in a fashion that conforms to one’s position and the reputation one has earned. I also encouraged participants to deepen their education in liberal arts and cultivate their humanity.

(I will report on the closing presentation session in the next entry of this series.)

September 15, 2011,13:17 +0900(JST) WinD Lab—The Monument of Winds

In 2007, redevelopment of the eastern area of the Osaka Works was initiated as a project marking the 110th anniversary of the founding of Sumitomo Electric. I have already reported on the completion of our new research building “WinD Lab,” as well as of a lecture hall and gardens adjacent to it. In August 2011, nearly five years after commencement of the project, a monument was established in the hall of the new research building, which I went to see and would like to write about here.

With the colossal monumentThis was the first time for us to build such an imposing monument as this in our commemorative project. On starting WinD Lab construction, we asked our project team to set up a monument that reflects the design concept of WinD Lab, namely, “The Winds-A Research Hub Creating New Businesses” (meaning we will ensure that the new laboratory will sensitively read the trends of the times and changing needs of society, i.e. “winds,” thereby contributing to society with the new “winds” of unique technologies). With these goals in mind, we decided to erect a monument as an embodiment of our wishes to deliver business results that support the development of our future generations.

After intensive discussions, redevelopment promotion members led by the General Manager of Osaka Works commissioned Professor Shoichi Ikeda of Nihon Fukushi University to produce a monument for us. The resultant work is “Shapes Comprising Winds Overlapping Each Other,” a very impressive installation made of white porcelain.

The five columns behind me represent our Group’s five existing business areas, expressing the extremely powerful and dynamic interactions between those areas.

Three columnsStools in the roof gardenWith the concentrating photovoltaic moduleThe next three columns symbolizing how new business frontiers emerge from the three new themes hope to support our future growth, namely, “environment, energy, and resources”; “life sciences”; and “safety & security, and ubiquitous networking.”

In the roof garden and rose garden adjacent to WinD Lab, planters and stools of the color and design that match the monument are placed, creating a sitting space where one can enjoy the sunlight and gentle flow of the wind. We would like to express our deep appreciation to Professor Ikeda for producing this marvelous work that so beautifully expresses the challenging concept of “winds.”

In June this year, Osaka Works completed the development of and held a rollout ceremony for a micro smart-grid demonstration system in which renewable power generators, such as solar and wind generators, and a storage battery are DC-interconnected. Blessed with soothing sunlight and the flow of the wind, we hope the new research building will motivate Osaka Works members to advance their R&D activities even further.

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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