Hitachi turnaround shows the way for Japan Inc
Hitachi is the beacon for troubled Japanese tech giants like Sony, Sharp, Panasonic and Renesas – all hit by flat sales growth for the past 15 years. according to Tokyo-based researchers Eurotechnology Japan.
Sharp, Sony and Panasonic lost a collective $19bn in the last financial year, say the researchers.
Hitachi hit trouble before any of these other companies with a $9.2bn loss in 2009 but it recovered to a $4bn profit in the last financial year.
Hitachi did the turnaround in the conventional modern way – closing high cost plants at home and outsourcing manufacturing to cheap plants abroad. A 400,000 workforce was reduced to 323,500 of which a third work overseas.
Eurotechnology blames falling product prices, high costs at home, a strong yen, an inability to profit from the shift to software and services, intense foreign competition and a lack of focus for the problems of the Japanese tech giants.