The MELCO Plus editorial teams asked President & CEO Uruma about a review of the first half of fiscal year 2024, challenges for the second half, and progress in My Purpose activities.
1. The world is changing rapidly with the situation in the Middle East and Ukraine and fluctuating exchange rates and interest rates. There is also a growing concern in Japan about the possibility of earthquake disasters. What should we be aware of under these circumstances?
There are limits to what a single company can do in response to geopolitical situations and economic and policy trends. Although there will be likely be direct and indirect effects, there is no need to get too excited or upset by each individual change, and I hope that the company will steadily implement measures that should be taken, such as supplementing missing parts, to achieve our ideal form. On the other hand, regarding natural disasters such as earthquakes, I would particularly like bases in regions with a high risk of disasters to continue reviewing their initial responses and BCPs (Business Continuity Planning) in the event of a disaster.
2. Please tell us about the current business conditions and challenges for the second half of the year.
Compared to our forecast at the beginning of the fiscal year, market recovery has been delayed mainly in FA systems, but we plan to increase production output in FA, air conditioning, and other mass-production businesses in line with the demand in growth after market recovery. Therefore, it will be important to determine when and how to step on the accelerator in the second half of the year. In preparation for a sudden increase in orders, I ask that each of you develop the mobility and mechanisms to respond appropriately to market demands. Due to the long lead time from production to shipment in individual production businesses, it is important to level out and improve the efficiency of production. It is also necessary to improve prices in light of rising procurement costs, including for raw materials. I feel that the concept of ROIC1, which emphasizes asset efficiency and profitability, is steadily spreading. At the Group-Wide Presentation Event for JIT Kaizen2 in July, Mitsubishi Electric Dalian Industrial Products Co., Ltd. (MDI) in China introduced their initiatives to strengthen their business from the perspective of ROIC. By clarifying the roles and responsibilities of not only the manufacturing division but also the accounting, finance, materials, sales, and other divisions, and by involving material suppliers in ROIC improvement initiatives, they have achieved significant results, including reducing production costs, manufacturing costs, shelf stock, and lead times. I would like to encourage you to spread these initiatives. To increase the ROIC of our business, I believe it is important for each of you to seriously consider what you should achieve, share your wisdom, and work together as a team.
3. My Purpose activities, which began in the fiscal year 2024, are being expanded to Group companies. Have there been any changes within the company or in the way you interact with your surroundings?
My Purpose represents the will of each individual’s ideal form in society. When an individual’s purpose overlaps with the company’s Purpose, they will feel a sense of fulfillment and excitement at work. Recently, I have heard that dialogue has been promoted within the workplace through sharing purposes with colleagues and understanding each other’s values and ideas. I would like to encourage those who are not yet involved in My Purpose activities to participate and for everyone to start discussing each other’s purposes in the workplace. I believe that through dialogue, you can become a team that brings out the individuality and strengths of each member, and this will be the driving force that enhances the organizational power of our Group. All executive officers, including myself, take advantage of opportunities such as family training to increase dialogue and work on team building to bring us closer together.