MATSUSHITA LEADERSHIP-BOOK REVIEW

ABOUT THE AUTHOR

John P. Kotter is The Konosuke Matsushita Professor of Leadership at The Harvard Business School. He is a Graduate of MIT and Harvard and has been on the Business School Faculty since 1972. In 1980, at the Age of Thirty Three, he was voted tenure and a full Professorship, making him one of the youngest people in the history of the University to be so honored.

Professor Kotter is the Author of the General Managers (1982),Power and Influence; Beyond Formal Authority(1985),A Force For Change; How leadership differ from management (1990)Corporate Culture and Performance (1992,with Jim Heskett), The New Rules : How to succeed in today’s post corporate world (1995), and leading changes (1996),he also created two highly acclaimed executive video’s one on leadership (1991) and one on corporate Culture (1993),as well as en educational CD- ROM on initiating change (1997).his article written over the past twenty years for the Harvard Business review have sold a million and half reprints.

The many honors won by professor Kotter include an Exxon award for innovation in graduate business school curriculum design, a Johnson, Smith & Kinsey award for new perspective in business leadership, and a McKinsey award for best business review articles.Professor Kotter has taught in both MBA and Executive programs at Harvard and is a frequent speaker at top management meeting around the world.

SUMMARY

By many standards he didn’t look like a great leader. A picture of Konosuke Matsushita shows an unsmiling young man whose ear stick out, who is neither more than five feet five inches tall nor weighted more than 135 pounds. He didn’t excel at public speaking and in his later years grew increasingly frail. He rarely displayed speed of light intellectual skills or warmed an audience with hilarious on ecolotes, nevertheless he did what all great leaders do motivate large groups of individuals to improve the human condition through the Matsushita Electric Industry (MEI) $ 65 billion a year group with brands like National, Panasonic, etc.

Konosuke Matsushita was born in a village called Wasamura, two hundred and forty miles to the south of Osaka city November 27, 1894. He was the Final Sibling of a ten member Family of middle class Stature. Konosuke Matsushita’s father owned 150 acres of land worked by seven tenant farmers. In his early years life was peaceful and carefree for Konosuke Matsushita till 1899 when the family economic fortunes collapsed. The ten member family was forced to move into a small slum apartment nearby Wakayama, at the age of nine he was send to Osaka city to work sixteen hours a day and live with his employer but casualties affected the family,

and within a year from October 1900 to August 1901, Konosuke Matsushita lost three of his siblings due to infectious diseases.Konosuke Matsushita at the age of nine started working as an apprentice in Osaka. His initial duties were that of a household servant, and then he started working on the polishing of the product Hibachi for which he was paid 5 sen twice a month with free food and stay. After working for 3 months he joined a bicycle shop, wherein he worked as an unskilled labour. In 1906 Konosuke Matsushita lost two more of his siblings and his father as well the family was reduced to five. He worked at the Bicycle shop till the age of 15. Somewhere in 1910 Konosuke Matsushita approached a Brother in law and asked help in obtaining job with an electric light company .This landed him in the Osaka Electric light Co. His job was to assist senior employees in the wiring of businesses and homes for lightning. Konosuke Matsushita’s job was to pull a two - wheeled cult loaded with tools and fixtures, provided help when asked, and generally be a good servant. His salary was one Yen per month, he attended night classes at Kansui Commercial and Industrial school but after two years he quit. By the time he was sixteen, Konosuke Matsushita’s was managing and directing other people, and became a Foreman at the age of nineteen. In 1913, three years after he joined the electric company he lost his mother and a sister, the family of ten was now down to three, Konosuke Matsushita and his two sisters.

In May 1915 Konosuke Matsushita got married to a young woman Mumeno Iue who worked as a domestic servant at a merchant family in Kyomachibori. At the time of marriage Konosuke Matsushita was twenty seven and his wife nineteen years old. In 1917 Konosuke Matsushita designed a light socket superior to the one made by his company, but his boss refused to accept it. Disheartened by it he quit the job and decided to manufacture his own sockets and market it through another company. Konosuke Matsushita began his business with savings of one hundred yen and four assistants. The first was his wife Mumeno, second was Isaburo Hayashi, a former co-worker and friend, third was Nobustro Moriter another co-worker and last Zoshio Iue, his wife’s brother. With no revenues and very limited financing, they scrambled to manufacture, assistance finally came from a friend. Samples were manufacture but received poor reception from the wholesalers. To add to the misery Hayashi and Morita left to take job elsewhere. But they didn’t give up. Finally they got an order of one thousand insulation plates to which Konosuke Matsushita agreed without hesitation, the first order was completed in time and the purchaser did like the quality hence a second order of two thousand plates was placed. Konosuke Matsushita started producing electrical attachment plug in addition to the above two products after moving to a bigger facility Konosuke Matsushita produced two way sockets. The exclusive rights to market it was sold to a wholesaler named Yoshida for a 3000 Yen loan to Finance increased production capacity. But miseries continued and in 1919 twenty eight year old sister Ai passed away and two years later Iwa died. The family of ten was reduced to one. He was the only survivor.

Matsushita Electric Industry (MEI) expanded in 1919, 1920, 1921 facing increasing competition from new entrance in the electrical products. Matsushita initially would himself design the products, his main focus was customer satisfaction .He believed that if the customers was satisfied with his product he would come back again. He intended to build a relationship with the customer. By 1922, the firm was introducing one or two products every month, better but cheaper was the usual

strategy. In 1922, he invented battery – powered bicycle lamps. To distribute it he developed a new marketing strategy for not asking for money from retailers until the product was sold. Within weeks sales Skyrocketed. The focus now shifted on mass production and mass marketing. The lamps were sold under the brand name “National”.Konosuke Matsushita had a girl born in 1920 and then in 1926 a boy was born to Mumeno. But unfortunately the boy died in a year. In 1929 the great depression hit the world. It hit electrical supply manufactures of Japan hard and fast. Even though the economy was weak Konosuke Matsushita to enter the radio market. Matsushita Electric Industry sold its first radio in August 1930.production of National Radio’s increased from 1000 in 1931 to 2,37,000 in 1938. By 1942 Matsushita Electric Industry was the largest Radio manufacturer of Japan. Matsushita Electric Industry was no longer a small enterprise. It manufactured more than two hundred products in four different categories wiring fixtures, radio, lamps and dry batteries. This was the time Konosuke Matsushita started appreciating the value of religion and God in his life. In 1933, Konosuke Matsushita reorganized the firm by-products. Division one manufactured radios division two focused on Lamps and batteries, division three produced wiring implements and synthetic resins, division four handled electric heating appliances-irons, heaters. Each group operated like a separate entity with different production and sales distribution networks. By 1930, the business employed around 6500 people. At the end of the decade Konosuke Matsushita married his only daughter to Masaharu Hirata, a graduate of the law department of Tokyo University who later on went to become the chairman of Matsushita Electric Industry.

Around 1937, World War II started and Matsushita Electric Industry was forced to help the Japanese military by manufacturing products according to their requirements. Konosuke Matsushita considered this as a duty towards the Nation and created an aircraft and shipbuilding company. But the Japanese lost the war and the allied force took the control of it. Matsushita Electric Industry was forced to cease production and Konosuke Matsushita was asked to move out of the company board. It was not until 1950, that both Konosuke Matsushita and his company were allowed to operate freely again. It was a process of rebuilding the firm from scratch as all was lost in the war. But Konosuke Matsushita stood up to the challenge. In 1952, Matsushita Electric Industry signed a joint venture with Philips to provide technological know how of its product, A Philips Matsushita factory was built in Osaka to provide television picture tubes florescent lights and other electrical products. In 1959 a sales company was established in United States and product were sold under the brand name Panasonic. KM founded two institutions; one was the PHP (peace and happiness through prosperity) in 1946 and the other Matsushita Institute of Government Management (MIGM) in1979. He spent later part of his life in this institute studying human nature with research students. He passed away in the spring of 1989 wherein over forty thousand people attended his funeral. The president of United States in a condolence message of his family called him on inspiration to people around the world.

ANALYSIS

Konosuke Matsushita Introduced the Concept of Marketing in Real Sense. Thus the lessons learnt from it amount right from treating people you do business with as if they were a part of your family. Prosperity depends on how much you understand the people with whom you do business, do not sell whomsoever goods they are attracted to, but sell them goods that will benefit them. When you work in a company your efforts should be waste reduction, as any waste will increase the price of the product by that much. The mission on a whole for the manufacturing organization should be to overcome poverty, to relieve society as a whole from the misery of poverty and bring it wealth. Purpose of an organization should be to generate wealth not only for the owners but also for everyone.

Also possessing only material comforts in no way guarantee happiness. Spiritual wealth is required to get true happiness which can be seen from the improvement in productivity of organization as well as wellbeing of society after the start of morning prayers by the employees of MEI. Thus Businessmen should be able to create a society that is spiritually rich and materially affluent.

One of the most important lessons is the dedication, determination and hard work of the person. Matsushita being born in a poor family working for sixteen hour’s a day. Not only did he suffer economic hardships but also personnel ones loosing all the members of the family when he was in his twenties, but the essence of it is not to be let down by obstacles in your life but to fight with them. Also he left off his well paying job to start up his own company, which he means he had the insight of his capabilities. Thus one thing which can be learnt from this is that a person should always dream and aim higher; you should not be satisfied by what you in your hand, you should try and achieve what is possible.

One more point is of risk taking ability, as risk is proportional to returns. But before taking risk a person should look at whether he is capable of it. Thus it should be a calculated risk which has to be taken Konosuke Matsushita could have stayed at the bicycle shop and got a better than average middle-class life, but he did not. That means he had a vision which is to be leant from this. That whatever is present to him did not satisfy him. We should break out from any such relationship to embark on journey even if the path is uncertain. Another thing which is important is to be independent of others. It means you should be self sufficient and should not expect anything from others you should cope with difficult times and benefit from them, like the famous statement ‘that which does not kill me, makes me stronger.’

Also we can see that entrepreneurial ventures offer more control over ones destiny, thus allowing changing the status quo and permitting a person to

work for himself rather than his boss. Some of the traits a person should have to be a successful Entrepreneur, are great commercial judgment, an instinct far dealing with people, keen intelligence, and a charismatic personality. But most important is the zeal for work which if not present then others are meaningless. Another important thing is motivation in a person’s life. With little motivation can never start a business, given that the problems he would encounter. Even if you do face easily success it should not satisfy or reduce your ambitions, but on the contrary it should increase your desires. You should only view success as a proof of being on the right track & failures as inevitable burdens that one must suffer in the life.

Another aspect of business is keeping a cost low that does not means treating employees poorly. Relationship with supplies and distributors should also be close like a family and not formal or at an aims length. One important thing is to learn from mistakes. It is okay to commit mistakes or errors in the life but most important is to learn from those mistakes- and not to make them in future. It is also seen that success in individuals creates rigidity and egotism and not self. Examination and search for still more improvements which should be the case. Once a person occupies a responsible position he should always pay close attention to the problems that are crucial in bringing a certain task of completion.

You must examine them in a free or creative frame of mind, to find a workable answer with convention that it can be done rather than to waste energy working about its difficulty. You should not let difficulties get better of you. Adversity should make person stronger.

One more important aspect that comes out of the book is of spirituality. It makes a person open minded and less prone to worry. Praying and worshipping could let you to discover the joy of religious faith. It makes a person feel that his life is worthwhile. Thus if an organization is make more meaningful like a religion, people could be both more satisfied and more productive. A person should always search some meaning in his life, it would not necessarily be money but something that would sooth his soul. A person should have set of values without which life would have no meaning. Values would be service to the public, fairness and honesty in dealings, teamwork for the common cause uniting effort for improvement, courtesy and humility. A person should be grateful for all the blessings and kind ness that he was received either from parents, teachers, friends or fellow human beings.

Another thing that a person should learn is to be lead by example. Getting your employees towards a concern objective to require a sincere initiative effort from your side. When you are in a position where you lead a group your thinking should be on a broader perspective as to how decision would affect the organizations as a whole rather thinking in a narrow way. No matter what kind of job you have, you should think of yourself as being completely in charge of and responsible for your work, like being the president of your own company. By doing this not only the work will be done perfectly, but also new discoveries will be made also it will greatly assist your self-development. Also your style of leadership should be mixed with tough and gentleness to be used accordingly.

A leader should always have faith and trust in his employees. This is a very strong point that would put all the groups in the same direction. Every single

person you meet is your customer. Treat him as a family member; you should always live with the ideals of simplicity, frugality and humanity. One point to be noted is that at the time of wars or natural calamities service to the nation should become your first priority, everything else would be then taken to backseat. One more important aspect is related to age. A person should not consider himself old till he is young at heart. A person should be as open as he is throughout all the phases of his life. A person does not get old till he deserts his values. A myopic point of view and a closed mind creates great dangers. A person needs to have an open mind to new ideas and be flexible. One of the most important factors is the firm’s management and employees attitude. A person needs to believe in the company’s core concepts and at the same time should be receptive and flexible. A person needs to be humble as he would not be arrogant and reckless. He would listen to others and do what is right. We ourselves are responsible for our own destiny. One road would lead us to peace happiness and other towards chaos and self destruction. Thus a leader becomes a good role model when he is humble, respectful, and open to new experiences, diligent, hardworking, and optimistic. In the final analysis it is the people who make it happen, not the leader. But good leadership will help to maximize their potential.