Charismatic business leader Kazuo Inamori, founder of Kyocera, dies at 90
Kazuo Inamori, the founder of Kyocera, in Kyoto in 2015 | BLOOMBERGBY KAZUAKI NAGATA
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Kyocera founder Kazuo Inamori, one of Japan’s most influential and respected business leaders, died of natural causes at his home in the city of Kyoto on Aug. 24, the firm announced Tuesday. He was 90.
Inamori, a native of Kagoshima Prefecture, established Kyocera in 1959 in Kyoto when he was 27. The firm started with 28 staffers, but eventually turned into a major electronics and parts maker boasting more than 80,000 employees globally.
He also co-founded DDI in 1984, a predecessor of KDDI, to facilitate competition in the telecommunications market, then dominated by NTT. KDDI is now one of the top three mobile phone carriers in Japan.
After Japan Airlines went bankrupt in 2010, Inamori was asked by then-Prime Minister Yukio Hatoyama to lead and turn around the ailing airline. Inamori accepted the job with no compensation and tackled JAL’s reconstruction as chairman for about three years.
Under Inamori’s leadership and management reforms, JAL experienced a revival and went public again less than three years after its bankruptcy.
Inamori is known for his creation of the “amoeba management method,” under which workers are divided into small groups called amoeba.
Each group is provided with real-time figures on their business operations and achievements, and they are encouraged to work as if they are an independent entity within the company.
Some firms formerly led by Inamori — including Kyocera, KDDI and JAL — that have adopted the amoeba system have successfully grown into major players in their fields.
“I have spent many years in management and know from my experience that it’s important to have a system to allow you to grasp details of real-time figures and results so that all employees can pitch ideas to improve business operations,” Inamori told a news conference in October 2010 when he was restructuring JAL.
Inamori, who was also an ordained Buddhist monk, published numerous books on business management, leadership and philosophy, and inspired many other business figures.
Sachio Semmoto, one of Japan’s best-known entrepreneurs and a fellow co-founder of KDDI’s predecessor, told The Japan Times in an interview in 2018 that Inamori changed his life.
“Meeting with such a great business leader was the trigger. I don’t think I would’ve founded (DDI) if I hadn’t met Mr. Inamori,” Semmoto said, adding that Inamori taught him a great deal about business leadership.
Inamori ran a business school between 1983 and 2019, and spent his personal fortune on philanthropy.
In 1984, he spent about ¥20 billion to establish the Inamori Foundation. The organization gives awards to individuals who have made remarkable contributions to society and offers financial support for unique research.
KEYWORDS
JAL, OBITUARY, KAZUO INAMORI, KDDI, ENTREPRENEURS, KYOCERA, TECH
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Opinion Inside Business
Kazuo Inamori: Lessons from one of Japan’s great industrialists
Teachings of Kyocera and KDDI founder were surprisingly simple and still resonate today
KANA INAGAKIAdd to myFT
Kazuo Inamori, who died last month, helped drive Japan’s economic miracle in the postwar period. He believed companies should focus on the livelihood and wellbeing of employees instead of simply pursuing profits © Charlie Bibby/Financial Times
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Kana Inagaki SEPTEMBER 6 2022
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As a messy succession crisis unfolded at Apple supplier Nidec, Shigenobu Nagamori, its 78-year-old founder, had one big regret.
Over the past decade, he had poached a number of high-profile executives from carmaker Nissan and electronics maker Sharp as potential heirs. But none of his outside picks met his towering expectations. Instead, they left the company, leaving an exasperated Nagamori to last week tap one of Nidec’s founding members as a temporary president.
“When Mr Kazuo Inamori was alive, he told me that a company insider is best as president. His warning turned out to be true,” Nagamori said, acknowledging with guilt that he had finally realised how talented his employees were.
Inamori, the renowned founder of ceramics company Kyocera and telecoms group KDDI, died at the age of 90 in Kyoto last month. Known in Japan as the “God of management”, he was one of the country’s great industrialists. Along with Sony’s Akio Morita and Soichiro Honda, the founder of the eponymous carmaker, Inamori helped drive the country’s economic miracle in the postwar period. He also helped rebuild Japan Airlines from the ashes of bankruptcy in 2010 without receiving a dime for his role as chair.
Long before stakeholder capitalism and the need to serve employees along with investors became vogue in the west, Inamori’s management philosophy had centred on his belief that companies should focus on the livelihood and wellbeing of employees instead of simply pursuing profits.
In his first interview with the Financial Times in 1978, Inamori explained that what tied his company and workers was not simply a financial contract, but “a human relationship” based on trust and partnership.
His motivation, he claimed, had nothing to do with accumulating personal wealth. “We have a saying: money has legs and if you try to catch it, it will run away from you,” he said. At the same time, he was a ruthless cost-cutter, who had forced the proud employees of JAL to save expenses on everything from lunch boxes to corporate pamphlets.
The teachings of Inamori were surprisingly simple: don’t be greedy or selfish, be honest and most importantly, do what is right as a human being. His principles resonated beyond Japan to China, and attracted 15,000 students to his leadership schools worldwide, including SoftBank founder Masayoshi Son.
How do these teachings resonate today? In his book A Compass to Fulfilment, Inamori himself questioned and then quickly rejected the idea that his philosophy was too outdated for the complex modern world. He argued that a sincere attitude and a focus on the universal good as opposed to national interests were the approach needed to settle international trade and history disputes.
In an era where nationalism is on the rise following the supply chain disruptions of Covid-19 and the energy crisis sparked by Russia’s invasion of Ukraine, there are practical lessons to take away.
One is the need for entrepreneurial spirit at a time when the start-up scene in Japan is so dormant that the government has promised heavy state investment. Like the Honda founder, Inamori was a warrior and a rebel, who resisted meddling from the government and banks as he transformed Kyocera and KDDI into global technology participants.
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By setting up KDDI, Japan’s second-largest carrier, he brought competition to a market that was controlled by formerly state-owned NTT. When Japanese manufacturers proved too conservative to try out what is now Kyocera’s technology, Inamori ventured into the US, eventually clinching a contract with Texas Instruments to supply electrical resister rods for the Apollo space programme.
Inamori’s best-known concept of “amoeba management”, which involves dividing up large organisations into small units that draw up their own goals and strategic plans, is also pertinent. Companies will need independent thinkers to come up with innovative ways to navigate an environment where governments will feel compelled to intervene in the name of ensuring economic security.
His bottom-up management style and his investment in training employees have allowed Kyocera and KDDI to avoid the succession challenge plaguing corporate Japan. Inamori, who decided to retire at the age of 65 to study Buddhism, never clung to his leadership position: “It did not have to be me who founded Kyocera or KDDI. By chance, heaven provided me with that role and I was merely acting it.”
kana.inagaki@ft.com
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Kazuo Inamori, Japanese mogul who became Buddhist monk, dies at 90
By Brian Murphy
September 3, 2022 at 3:11 p.m. EDT
Kazuo Inamori in Tokyo in 2010. (Koji Sasahara/AP)
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Kazuo Inamori, a self-made mogul in Japan’s postwar boom who portrayed work as an almost spiritual mission as he built powerhouse ceramics and telecommunications companies and then traded his business suits for the robes of a Buddhist monk, died Aug. 24 in Kyoto, Japan. He was 90.
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Kyocera, a specialized ceramics and electronics firm he founded in Kyoto, announced the death in a statement.
Mr. Inamori was often placed alongside Sony’s Akio Morita and vehicle-maker Soichiro Honda as the vanguards of Japan’s industrial rebound after World War II to become one of the world’s top economies.
Kyocera, founded by Mr. Inamori in 1959 with the equivalent of $10,000 and a line of credit, grew into a dominant player in the global semiconductor market, making precision ceramics that are key components in computers and other devices since they resist heat and do not conduct electricity.
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In 1984, he created the long-distance phone carrier DDI (now known as KDDI) that quickly broke into a market once held by a former state-owned monopoly, NTT.
In 1990s, Japan’s industrialists helped steer country from recession
In Japan’s inflexible corporate milieu, Mr. Inamori was a singular personality and developed a reputation as something of a Zen master of capitalism.
He set himself apart with a management style that mixed Japan’s work ethic with concepts of higher callings and self-fulfillment, often taken from Mr. Inamori’s own writings. It was lampooned by some as cultish “Inamorism.” Mr. Inamori never wavered in his philosophy of corporate karma: Give excellence and empathy and the universe will smile back on you.
“We respect the divine and the spirit to work fairly and honestly,” he said.
Kazuo Inamori (Akio Kon/Bloomberg)
He moved into philanthropy as the founder of the Kyoto Prize, first given in 1985, recognizing advancements in sciences, arts, technology and philosophy. Past awardees include the linguist Noam Chomsky, the primate expert Jane Goodall and the philosopher Bruno Latour.
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“Most industrialists don’t dream, and most dreamers don’t manufacture things, so I am very lucky,” Mr. Inamori was quoted as saying in “The Next Century,” David Halberstam’s 1991 book.
Mr. Inamori retired in 1997 to dedicate himself to reflection and study in the Buddhist priesthood, shaving his head and keeping to a vegetarian diet. He returned to the boardroom in 2010 at age 77 after Japan’s government asked him to take the helm of the ailing national carrier Japan Airlines (JAL) as it filed for bankruptcy protection. A restructured JAL emerged from bankruptcy in March 2011, aided by state bailouts.
In his signature style, Mr. Inamori noted the painful process of layoffs and pay cuts as the airline clawed its way back, but he framed the ultimate success as aided by a greater power.
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“While this is not the Law of Cause & Effect as such,” he wrote in an essay posted on the Kyocera website, “I cannot help but think we received a helping hand from a source of universal compassion. I doubt whether such a miraculous recovery and transformation could have been achieved without ‘Divine intervention.’ ”
Kazuo Inamori was born Jan. 30, 1932, in Kagoshima on Japan’s southern Kyushu Island. The printing business of Mr. Inamori’s father offered a comfortable living. But Mr. Inamori said his home was firebombed during World War II, forcing the family into a hardscrabble existence until the war’s end.
In the sixth grade, he was struck with tuberculosis and, while bedridden, read a book on Buddhism that began his lifelong interest in the faith.
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He earned a degree in chemical engineering at Kagoshima University in 1955 and became a researcher at a ceramics company in Kyoto. Mr. Inamori once lived in the factory during a workers’ strike — being denounced by unions as “a running dog for capitalism” — to finish a project that he felt was critical for the company’s survival. He said he felt angered when his bosses wanted to give him extra pay for his loyalty.
“They never understood,” he told Halberstam. “They thought I was doing it for them, but what I wanted was the piece itself to be better. I had told all those who stayed and worked with me that we were doing something creative and beautiful.”
He broke from the company after he was told he would not advance because he had not attended a more prestigious university. Kyocera (a combination of Kyoto and ceramics) used Mr. Inamori’s techniques developed for ceramic insulators for televisions, trying to catch the wave of surging sales in the United States and elsewhere.
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Kyocera’s first U.S. customer was Fairchild Semiconductor, which placed orders for silicon transistor components, according to an oral history Mr. Inamori gave to the Science History Institute in 2010. IBM then placed a large order. Kyocera later diversified into products such as photovoltaic cells, electronics and bioceramics, used for repairing or replacing damaged bone.
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In 1962, Mr. Inamori made his first visit to the United States. His personal budget was so tight that, decades later, he still remembered the exact prices of a steak dinner at Tad’s in Times Square: $1.19 and $1.49 with salad. He toured some U.S. ceramics makers but soon realized that Kyocera was crafting higher-quality products.
“All he would talk about when we were together was his belief in what a company should be, what its obligations were,” Richard Nagai, who worked for a New York-based Japanese trading company and served as Mr. Inamori’s guide, recalled in an interview for Halberstam’s book. “I’m not with an engineer, I finally decided. I’m with some kind of missionary.”
During Kyocera’s early years, Mr. Inamori effectively lived at the factory. He gained the nickname “Mr. A.M.” for being on the floor until after midnight and back again at dawn. He joined his employees in morning exercises and began compiling writings that would become an anthology of his views on business and its obligations.
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“In capitalism,” he told the Boston Globe in 2012, “greediness is something regarded as a good thing. However, if we rely too much on that, I think society will collapse.”
Among his most-studied ideas is what he called “amoeba management,” a system of decentralized teams that have powers to make decisions and can add or shed members depending on the changing business environment.
His survivors include his wife of nearly 64 years, Asako Sunaga, and three daughters, the Associated Press reported. Complete information on survivors was not immediately available.
Before being called back to help rescue Japan Airlines, Mr. Inamori had pulled away from the public eye — living a simple life of meditation and chores in a Buddhist monastery in Kyoto.
In 2012, before returning to the monastic world, he tried to describe how his belief in helping humanity gave him something (Inner strength? insights? He couldn’t say.) that elevated his game.
“I don’t know how I can call it, heaven or God,” he said. “I think there was something else supporting me. I don’t think my ability is the only reason for my success.”
