Fujitsu is the third biggest player in the global IT services market, with sales of 4.6 trillion yen (US$50 billion) and 172,000 employees in 60 countries. It also has a long and distinguished track record as a technology pioneer. And yet, it remains little known outside of Japan. Stuart Crainer and Des Dearlove gained unique access to examine the art of Fujitsu management.
Dreams and detail
"For me the excitement lies in turning technology into profitable technology," says corporate senior executive vice president and director, Kazuo Ishida. "Along the way we make mistakes. Over my time with the company I have run 28 projects with teams ranging from 50 to 800. Some were a year long. At the end you hand over and move on to another project. But, I was never happy with how things had gone. I always looked back and identified where, when and how it could have been done better."
Fujitsu is a technology company built on engineering expertise. Its senior executives typically started their careers as engineers. An appetite for detail is part of their training. Fujitsu engineers prefer doing to theorising and have an elevated view of the likely impact of innovations on broader society: they see engineering as a route to improving the world. Dreams and detail are in unusually close alignment.
The fashionable business ideas of our time suggest that customers are unreliable guides. Simply, they do not know what the technology is capable of, so how can they tell you what they want or would like? As a result, the emphasis of recent years has been on retaining talented individuals rather than attracting and retaining high spending customers. Fujitsu is old fashioned in its adherence to the edict that customers come first. All Fujitsu executives talked about the vital importance of staying close to customers.
Thirty-six years with the company and now a corporate senior executive vice president and director, Kazuo Ishida told us of his first day working as a systems engineer. "I went to work with a banking client. It felt as though I had become a banker such was the identification we had with the customer. That stuck with me and I still spend half of my time with customers."
Grow with customers
Says Richard Christou, corporate senior executive vice president (the only Westerner in the company’s management team), who heads the company’s global businesses: “You don’t shape the future by simply selling technology. There has to be a dynamic, proactive interchange with customers.”
Customers are not static. Fujitsu regards them as a growth opportunity. But this does not mean trying to screw more sales out of each account. The win-win hope is that as customers grow, Fujitsu will grow alongside them. “We have a track record of working with Japanese companies and there is an opportunity to grow with them – and our other customers – as they globalise. As companies expand they need to use systems which are consistent, which they are familiar with and which can receive high levels of support worldwide,” says corporate senior executive vice president, Kenji Ikegai.
Masahiko Yamada, president of the company’s Technical Computing Solutions Unit, is an engaging Fujitsu veteran. “At one stage, I remember thinking that we need to really focus on costs and technology. I was wrong: relationships with customers are more important” says Yamada. Many companies focus on contracts, Fujitsu emphasises genuine relationships and growing with customers.
Multicultural and global
“If you think about where future market expansion will occur, you can only conclude that our future growth will depend on how successful we are in developing our global business,” says company president Masami Yamamoto.
His thoughts are echoed with even greater emphasis by Richard Christou: “I think we have a two year window to become more global in outlook. We have to move decisively. If we do not become more global, we will shrink.”
The initial ethos of globalising companies was to try to export the same products, services and culture worldwide. This was the largely American multinational model of the 1960s and 1970s. Then, in the 1980s and 1990s, the cry was for globalising companies to be global and local, to combine global strength with local sensitivities – witness McDonald’s offering localised menus throughout the world. Now, a new generation of globalisation is occurring as, in particular, companies from India expand globally. The emphasis of these organisations – and of Fujitsu – is to combine a clear sense of having roots while also having the open mindedness to embrace different business and national cultures. At Fujitsu, emphasis is put on the company being a global organisation with Japanese roots. It is multicultural but clear in its origins; globalisation with an open mind.
Respect and humility are deeply entrenched in Japanese culture. Similarly, they inform Japanese business culture and corporations. Gung-ho competitiveness is uncharacteristic. Rather, collective aspirations are the focus – whether they are for the team, the company or society. The emphasis of Fujitsu’s research is not on creating sexy, must-have technological fripperies. Instead, it regards improvements in technology as integral to improvements in how we live and how societies are organised and behave. This belief runs deep, but quietly.
Co-innovation rather than domination
Technology companies place huge store in innovation. But at Fujitsu the emphasis is on co-innovation with customers.
This is exemplified by the company’s concept of Field Innovation. This is a concrete example of how Fujitsu does things differently. As it deploys the concept, Fujitsu works seamlessly alongside its customers to create value for them by defining and visualising management challenges with customers.
At the same time, Fujitsu has always recognised the importance of being at technology’s cutting edge.Visit its Technology Hall in Kawasaki City on the outskirts of Tokyo and you are struck by the sheer range of its interests – from cloud computing to electronic medical record systems, plasma displays and point of sale displays at supermarkets. The range of products gives it a balanced portfolio and “a radar” for converging technologies and new innovations that can be transferred across products.
The fruits of experience
Fujitsu has a cadre of highly experienced managers. They know the company and its customers inside out. Many of the senior leaders at the company have worked with the company all their working lives. As engineers they have a constant urge for improvement. They are like mechanics tinkering with a car engine in search of a slight but significant performance enhancement. Things can always be improved.