Chapter 6

Case Studies

An U.S. army officer showed me how to fix the toilet problem by his hands. No Japanese army officer did that kind of thing. They just ordered by words.

—My father’s words about his POW camp in the Philippines

In this chapter, we will see some real-world cases so that you can check what you have learned against the real experiences of other people regarding the design and deployment of the services. The real cases have been picked up intentionally instead of artificial cases for the following reasons:

1. Artificial cases would be good for checking and extending your knowledge and skills; however, they tend to omit the subtle and difficult aspects that apply in the real world.
2. Real-world cases can talk about the real people behind the scene. As I showed in Chapter 1, the essential driver of the service is the individual and his or her motivation to make it. You can feel that in real cases.
3. Real cases reveal that the skills and techniques we learn in this book are common among the practitioners who have not learned them in school. This tells you the importance of learning from your experiences as well as others’ experiences.

We picked up cases from a retail store, a seafood manufacturer, and a mechanical and electronic manufacturer.

Toys Yoshida

In Asahikawa city in Hokkaido, there is a toy shop (see Figure 6.1) called Toys Yoshida (Omocha no Yoshida, in Japanese) that has now gained fame for a new tradition in toy movement in Japan. This toy shop was started by Teizo Yoshida in 1983. He took over the property of a wholesale toy shop established in 1950 after the World War II by his brother Keiichi Yoshida. Toy shops in Japan had been challenged by the international Toys “R” us in 1993. Toys Yoshida then enlarged its stores and started selling many kinds of toys including TV games that boosted their sales revenue.

Figure 6.1 Toys Yoshida in Asahikawa, Hokkaido, Japan

Courtesy of Toys Yoshida

However in 2001, Shuichi Yoshida, who inherited the toy shop from his father, had trouble as the sales for toys declined. A major reason for the decline was not only the decrease in the number of children (that is common in cities in Japan, by the way) but also the competition provided by mega shops such as Toys “R” us. He also had trouble selling TV-games, then a major category in toy sales, due to a small profit margin that created cash flow problems.

One day, a customer told him when she bought a TV game that “My kid will be okay for these games as birthday-present around three months, and I need not work with my kid while he play with TV-game.” Shuichi started to wonder if these TV-games eventually deprived kids of time with their parents and the pleasure of being with their parents. He remembered his young days when he played with his parents.

Mr. Yoshida decided then to decrease the space for TV-games even though they were in the category that sold most. He introduced a corner for traditional toys with which kids and parents could play together. These traditional games were games that the parents themselves had enjoyed playing when they were kids. Generation-through toys is the phrase he used to promote toys that traditionally kids played with their parents. The kids’ parents had played these games with their parents (who are grand-parents for the kids of today), but the kids themselves had got accustomed to playing TV-games by themselves. These generation-through toys can be played with their grandparents also. The grand parents could also teach their grandchildren how to play with these toys, so the communication within the family would be enhanced.

In 2006, Shuichi started to promote toys for handicapped children and launched Asahikawa Barrier-Free Toys Expo so that all children including both handicapped children and normal children could enjoy the toys and related events as seen in Figure 6.2. He opened this exhibition in his parking lot with about 5,000 people. The second Expo was held at Asahikawa Local Industries Promotion Center with 10,000 people. In 2008, 22,500 people gathered at Daisetsu Arena. From then, the festival has continued to attract not only normal and handicapped children but also adults of all ages.

Figure 6.2 Asahikawa Barrier-Free Toys Expo

Courtesy of Asahikawa Barrier-Free Toys EXPO

Shuichi started to develop the original toys to promote generation-
through toys and provided them to his friends in TCN (Toy Community Network)1 in 2014. They picked up Kendama which is now getting popular in USA and Europe2 and launched Kendama Cool (see Figure 6.3), which has had a warm reception in the market; even famous people, such as figure-skating gold medalist Mr. Hanyuu, enjoy playing it.

Figure 6.3 Kendama Cool

Courtesy of TCN

These are tough years for the toy industry, but Toys Yoshida maintains reasonable sales even though they have reduced the TV games that accounted for 300 million yen and occupied 100 m² once; now the TV games corner in Toys Yoshida is around 10 m² accounting for a few dozens of million yen. On the other hand, the mega toy stores, such as Toys-”R”-Us, have shut down some of their stores in Hokkaido.

Japanese toy shops have been facing two major problems: a decrease in the number of children and decreasing opportunities to play with toys both in terms of time and place. An aging population combined with the diminishing number of children has been a well-known problem in Japan. The decreasing time and opportunities for children to play with toys is a world-wide problem as TV games, tablets, and smart phones are getting more and more popular and open places for children to play with their friends and their families and relatives are getting smaller and smaller.

However, Mr. Yoshida has quite a different perspective: Toys are great devices to promote communications within families, friends, and with different people such as handicapped people. He believes that toys, especially those in the generation-through toys category, help children and adults by enhancing the communication between them and also because they continue to be useful to the individual as he or she grows and travels through his or her life. When modern corporations search for more attractive environments for their employees, the three-generation toys will be an option. Shuichi’s objective is now not the sales or profit of the shop but the enhancement of children’s life through their toys. Of course, he also hopes to keep up the spirits of adults and handicapped children.

Exercise

• Visit your local toy shop, and observe how they run the business. Observe the customers—what they buy and how they buy. If possible, check how the customers are planning to play with the toys.
• If you had been Shuichi in 2001 with the problems of the toy shop, what kind of plans would you have made to handle them? List them, and check what kind of outcomes could have resulted.
• Pick a toy store you know. How will you plan to make it much better?
• Pick a retail store you know of. What is their objective? If you were the owner, what objective would you like to set? How will the shop business change with the adoption of your objective?

Suzuhiro Kamaboko

Kamaboko, boiled fish paste is a common food in Japan as seen in
Figure 6.4. In an old Japanese document “Ruijuuzouyoushou” (a collection of explanations about various ceremonies) written around 1146. In the Heian era, a kamaboko was described for the relocation ceremony of a duke, Tadazane Fujiwara in the year 1115. Throughout the middle ages, kamaboko was a special food for special ceremonies of the aristocracy or very rich people.

Figure 6.4 Kamaboko, a Japanese Boiled Fish Plate

However, in this modern age, from the late Tokugawa and early Meiji eras, kamaboko became popular due to the advancement in fishery and process technology. Odawara, a western city 84 km or around one hour by a modern car from Tokyo, has been one of the manufacturing centers of kamaboko thanks to its fishery and the big neighboring market of Tokyo. Odawara also has a rich history; it was one of the political centers before the Edo era in 16th century, and has been an important station in Tokaido, the main road between Kyoto and Tokyo, and one of the major fishery ports throughout history.

There have been a few dozen kamaboko manufacturers in Odawara. Suzuhiro-Kamaboko, among the old and established manufacturers, was started in 1865 by Gon-emon Murataya the Fourth (Suzuhiro 2005). It was three years before the Meiji Restoration, very tough days for most people. Gon-emon carried on both fishery and kamaboko production, which was the popular operation those days in this port area. In 1871, the new Japanese government issued the law of family registration, where Gon-emon adopted the family name of Suzuki. Before that, only the samurai and aristocrats could have a family name; normal people like merchants, carpenters, and farmers could not have an official family name, even if they had a history that once upon a time their ancestors were samurais and had family names. Gon-emon’s son, Hirokichi Suzuki made kamaboko their family business and moved into the center of Odawara city near the fish market and branded his kamaboko store as Suzuhiro.

Hirokichi adopted Sumizaburo, a relative, as his son, and expanded their kamaboko business. Later Sumizaburo inherited the business name of Hirokichi, the Seventh, after his father passed away. Chieko, now in her 80s shown in Figure 6.5, the eldest daughter of Sumizaburo, married Shozo Ichige in 1952. It might be a Japanese rhetoric but she told us that she did not like the kamaboko business. She rather loved to study cooking. She was assistant professor in the Faculty of Home Economics (now called Human Sciences and Design) at Japan Women’s University and was a vice-custodian of its dormitory after her graduation from the department of Social Welfare. At her graduation, she had wanted to continue to study since her school days were mostly governed by war time operations and almost no time could be spent on study.

Figure 6.5 Chieko Suzuki, Chair of Suzuhiro Co. Ltd.

Courtesy of C. Suzuki

Chieko remembers that with her husband she shared a strong concern about the poor working environment for the workers. At that time, coal was the main fuel, so the factory area had lots of soot, and even the kamaboko got polluted. Workers had not enough room to rest. Some had eat their lunches standing.

Shozo and Chieko insisted and persuaded her father to move the factory to a better wide open area, although most people were against the move. The Suzuki family finally decided to move the factory to the Kazamatsuri area, in the south-west part of Odawara, near Hakone town. They had considered various places from Shizuoka to Kanagawa areas, and Chieko remembers one of the reasons to pick Kazamatsuri was that it belonged to Odawara, their family’s root, and that kamaboko was the specialty of Odawara. Another important factor was the water from the well, which came from the underground water from Mt. Fuji. The quality of that water is the best for producing kamaboko and other foods. Even today, Suzuhiro factory is using only the water from the well, and in an urgent situation when the public water service is down, the water is made available for everybody to take.

At the time of the move to Kazamatsuri in 1962, Chieko and Shozo had to overcome several challenges. First, not all the residents of Kazamatsuri welcomed the Suzuhiro factory. Chieko and Shozo patiently handled the criticism and contributed to local programs. Second, they not only renewed the manufacturing processes but also renovated their own business, that is, diversified from the kamaboko. They opened a drive-in restaurant, and were rewarded thanks to the motorization of
Japanese society.

One of the reasons for their diversification is the limitation of the fish as a natural resources. Odawara did enjoy a variety of fishes; however, the good fish for kamaboko is limited and political movements added to their availability. Another problem was their branding along with the Odawara kamaboko, which meant theirs was a specialty that was sold at a higher price but also meant seasonal fluctuation in sales. Their products were for special occasions, not for daily use, which means that it was used mainly for the New Year’s feast.

Shozo and Chieko continued to renovate the factory and in 1972, they opened a new factory named and trademarked as the factory to show, which embodies Chieko’s idea of what the Suzuhiro factory should be, that the workers are the experts in producing kamaboko and other foods, not slaves who just make the products.

In 1975, they opened an event house called Luxury Suzuhiro bringing the old house that was hundreds of years old from Toyama prefecture. With a museum and beer house added in the late 1990s, this area is now called Kamaboko-no-sato (a little kamaboko world) and is a shopping complex with restaurants and museums as shown in Figure 6.6.

Figure 6.6 Kamaboko-no-sato

In May of 1987, Shozo passed away due to esophageal cancer. Chieko took the CEO position in June, and her father Hirokichi died in July due to cardiac insufficiency. She was completely at a loss, and did not know what to do next. However, she returned to continue what they had achieved. She announced the corporate motto in 1988 “Legendary operation not staying at legendary,” showing her determination to maintain the principles but to innovate the company.

Today, Suzuhiro enjoys around 10 billion yen annual sales in total. They contribute to some events such as International Small Art Exhibition, or Kamaboko board painting contest. Their glocal position is good—they have their own brand, with the unique corporate identity design by ­Keiichi Torii shown in Figure 6.7, as prestigious food with Odawara, and have a global reach both on fishery and products, maintaining their business along with the diversification, which includes restaurants and shops.

Figure 6.7 Suzuhiro’s traditional seal design by K. Torii

Chieko, now in her 80s, continues to question whether they are doing the right things, and as in the past is ready to innovate even the way they operate. She has now taken on a leading role as president of Odawara-shi Tourist Association. She loves her home town very much.

Exercise

• Explore the relationship between the workers’ working environments, their welfare, and the performance of the corporation. What will be the drivers to promote the environment and welfare for the workers?
• Pick up a local specialty food in your area. If you were the owner of the company that produces the food, what will be your strategy to promote it.
• One of the reasons that Suzuhiro picked the restaurant business as diversification is that both Shozo and Chieko had experience in cooking. How do you evaluate this approach for diversification? Explore other cases and compare.
• Changing a location is quite common when your business grows, however, it may distort or even destroy some of your values. Check some cases of relocation of companies and summarize the merits and demerits.
• What are the challenges for “glocal” enterprises which insist on local specialties and entertain global customers?
• Study and summarize the interactions between private enterprise and society, especially in the food business.

Tsutomu Uematsu

At the TEDxSapporo, held on July 13, 2014, Tsutomu Uematsu (see Figure 6.8), Executive Director of Uematsu Electric Co. Ltd., was honored with a standing ovation for his talk entitled “Hope Invites.”3

Figure 6.8 Tsutomu Uematsu in his usual working wear style

Courtesy of T. Uematsu

Tsutomu was born in 1966 at a local city in Hokkaido, the northern island of Japan. His father ran a local ironworks. His grandparents once managed a successful car company in Sakhalin until the Soviet troops invaded and defeated the local Japanese army and destroyed all the Japanese families.

In his talk, he remembers his grandma talking to him: “Money is ridiculous, because its value will change. If you have money, do not save it, but buy books.” It echoes Jewish recipes for education (Sutter and Sutter 2010) that the real value lies in the wisdom in your brain; no other value can stay with you once you encounter a very bad situation such as a war, a bad emperor, unexpected disaster, and so on.

As a youngster, he had dreamt of going to the moon inspired by his grandfather who was excited at the Apollo moon landing in 1969. However, a teacher at his secondary school rebuked him for his dreams: “Stop talking about that imaginary stuff and study for the test.” He explained to Tsutomu, “To begin with, things like space engineering are impossible unless you are really smart. It cost too much. It is a different world. You cannot do it.” People told him that it was impossible, especially for him.

However, Tsutomu did pursue his dream on space engineering. He was not a smart student and did not earn high scores throughout his school days. Still, he maintained his dream and managed to enter Kitami Institute of Technology against the advise that it would be impossible for him. After graduation in 1989, Tsutomu joined Ryoyu Computing Co. Ltd. (now Ryoyu Systems Co. Ltd.) at Nagoya where he was assigned to the Aerospace Department.

He then quit Ryoyu in May 1994 to join his father’s company to manage the business back in Hokkaido. His business went very well from the beginning; however, he was trapped into a situation of just trying to gain money, was deceived, and encountered a huge loss.

The turning point in his life was a visit to an orphanage, where the children had been separated from their parents for various reasons including death, divorce, bankruptcy, and so on. The visit was arranged by the local Junior Chamber, which Tsutomu had joined in order to get business opportunities. When asked what they wanted most, the children answered that they wanted to meet their parents again. He was shocked and wanted to know why the children wanted to see the parents who had abandoned them. Then he realized that he wasn’t in any position to make those children happier than they were.

Tsutomu was suddenly reminded of his younger days, and this was the point of his conversion to becoming a social entrepreneur. He decided that his business would become a means to help children keep their hopes alive and become happier. He himself had a stroke of luck when he met Professor Nagata at Hokkaido University who was designing a space rocket and was searching for a supporter.

Tsutomu described his meeting with Prof. Nagata, who was looking for support in his space rocket project. He proposed to the professor that though he could not afford to offer big money, he and his company could build Nagata’s rocket. Eventually the team succeeded in launching the rocket. His dream was achieved.

He preaches in many places that the best way to get something you want is to make it rather than earning the money to buy it. His reasoning is that you can build your expertise through developing the thing you want to have, rather than wasting your time to earn the money to buy it, especially when the thing is the dream of your own.

He and his company are now well known for the development of space rockets. He has written two books (Uematsu 2009b, 2009c). There is a comic book (Tahara and Uematsu 2010) and a DVD of his talk (Uematsu 2009a). Uematsu Electric has become a famous spot for school children to visit: more than 7,000 pupils have visited and enjoyed shooting up their own rockets. Tsutomu is now busy traveling and giving talks to school children and the general public almost every week. He is still worrying that the situation of Japanese children in general is not good enough as most children cannot hold their own dreams. He still has hope that some day all the children in Japan can make their dreams come true.

Exercise

• Tsutomu declares that Uematsu Electric does not pursue revenue, while it boasts of a big share, 80 percent, of the electrical magnets used for recycling trucks. Explain how this business decision relates to his own belief in children’s education. Please discuss the pros and cons of his business approach.
• It seems that Tsutomu’s business failure has led to his conversion. How much do you think his experience with the children at the orphanage affected his decision to help children first rather than to expand his business? If his business was in good shape, do you think he would have made this change to help children? Please explain the reason why you think so.
• According to Tsutomu, sometimes some people attribute his nonprofit activities to his business success. He criticizes these people as misunderstanding his motivation and the reason he and his company are doing this kind of nonprofit work. Tsutomu argues that it is necessary and useful to help liberate children from any kind of suppression that prevents them from achieving their dreams. He asks why you would like to be rich. The money should be used for something. Getting rich cannot be a man’s final target to achieve. What do you think of his reasoning?
• By Japanese standards, Tsutomu’s history is very unique. How do you think his activity comes from his unique experience? In another words, how do you think ordinary people can achieve such a dramatic goal of making space rocket?

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