Kazuo Inamori was one of Japan's most successful and influential entrepreneurs. Image

Kazuo Inamori, the founder and chairman emeritus of Kyocera – a top rank Japanese maker of electronic components, devices and materials – passed away at his home in Kyoto on August 24. He was 90 years old.

Inamori was one of Japan’s most outstanding entrepreneurs and business executives, making his mark as a managerial innovator, educator, writer, philanthropist and philosopher. After 38 years at the helm, he resigned as Chairman of Kyocera and entered the Buddhist priesthood at the Rinzai sect’s Enpuku-ji temple in 1997.

In addition to building what is now a global technology company with revenues of US$14 billion, Inamori took advantage of the deregulation of Japan’s telecommunications industry in 1984 to establish DDI Corporation. In 2000, DDI merged with two other companies to form KDDI, Japan’s second-ranking mobile telecom operator.

In 2010, in response to a request from the minister of transport, Inamori became chairman of Japan Airlines (JAL), which at the time had gone bankrupt with debts exceeding $25 billion. After two years of major restructuring, the company returned to profitability and was relisted on the Tokyo Stock Exchange. In 2013, Inamori resigned his position as savior of the national flag carrier.

Years later he said,

Shortly after I took the post of JAL chairman, I announced to all employees, ‘The purpose of management at the newly reborn Japan Airlines is to provide opportunities for the material and intellectual growth of all our employees.… From here on, the corporation known as Japan Airlines exists not for the benefit of shareholders, and certainly not for the self-interest of its managers, but for the growth of all employees who comprise this company…. To break down the established bureaucracy of Japan Airlines, I implemented a reorganization to clarify a system of responsibility. This was followed by constructing a management accounting system to raise profit awareness.

A large percentage of JAL employees were made redundant, salaries and pensions were slashed, subsidiaries sold off and unions broken but the company survived.

Inamori saved and redefined Japan Airlines, the country’s flag carrier and second-largest airline. Photo: iStock

Born in 1932 in Kagoshima at the southern tip of Japan’s southwestern island of Kyushu, Inamori had problems as a child. He failed his junior high school entrance examination and had to attend a post-elementary school in order to catch up with the other kids. In 1945, the family home was destroyed in a US Air Force bombing raid.

That same year, he caught tuberculosis. Two of his uncles and one aunt had already died from the disease so he was worried. Confined to bed, he read a book called “Truth of Life” which, as later was written on his website page, laid “the foundation for his belief that our reality is a reflection of our minds.”

Inamori eventually finished high school and enrolled in Kagoshima University, Faculty of Engineering, Department of Applied Chemistry. This education was key to his future success as an entrepreneur.

After graduating in 1955, he went to work for a maker of insulators in Kyoto. While there, he synthesized forsterite ceramics (magnesium silicate), which are used to make synthetic gems. He quit that job after a dispute with management and in 1959 set up his own company, Kyoto Ceramic Co Ltd.

Kyoto Ceramic’s first product was an insulator, but it quickly added other electronic and structural ceramic components. In 1966, Inamori received a breakthrough order from America’s IBM for alumina IC substrates. In order to fill this order, it developed technologies that raised it to prominence as a world leader in ceramic IC packages.

In 1982, after merging with producers of electronic components, castings, medical equipment and jewelry, the company changed its name to Kyocera Corporation.

Kyocera became a comprehensive maker of applied ceramics products including synthetic gems (rubies, emeralds, sapphires, opals, etc), photovoltaic modules, biocompatible tooth- and-joint replacements, industrial cutting tools and kitchen knives.

Kyocera then embarked on a series of acquisitions that turned it into a world-class supplier of electronic components (connectors, capacitors, crystal oscillators, power diodes, etc), semiconductor and display materials, telecom equipment and printers.

More recently, the company has developed an AI-based object-recognition camera and a combined light detection and ranging (LIDAR) and optical image sensor for autonomous driving.

In January 2021, Kyocera acquired Soraa Laser Diode, Inc, the developer of gallium nitride-based solid-state lighting technology founded by Nobel Prize winner Shuji Nakamura and fellow professors Steven DenBaars and James Speck of the University of California at Santa Barbara.

Inamori built Kynocera into a global powerhouse. Image: Twitter

Nakamura, who invented the blue laser diode, made headlines in 2001 when he sued his Japanese employer, Nichia Corporation, for not fairly compensating him for his invention. He won his case and was awarded record compensation, but defected to the US due to the bitterness of the dispute and an invitation to become a professor at the College of Engineering at the University of California at Santa Barbera.

Now his inventions – which are used in automotive, lighting, display, biomedical, consumer and industrial applications – will benefit from the global marketing power of Kyocera.

In 1984, Inamori established the Inamori Foundation, which “seeks to actively promote peace and prosperity among all people on earth through the promotion of mutual understanding. It does this through programs of public recognition and the support of creative activities to foster science, culture, and the enrichment of the human spirit, as well as through social contributions.”

The Inamori Foundation awards an annual Kyoto Prize “to honor those who have made significant contributions in one of three categories: Advanced Technology, Basic Sciences, or Arts and Philosophy.” This year’s Kyoto Prize has been given to electronics engineer and applied physicist Carver Mead, population biologist Brian T Grenfell and tabla player Zakir Hussain.

Inamori also established a business school called Seiwajyuku, “an association that began in 1983 when 25 young business owners in Kyoto asked Inamori to teach them how to be effective managers. Upon receiving this request, Inamori taught them his management philosophy, which is characterized by the belief that a manager’s mission is to refine his or her spirit to bring about prosperity for the company and happiness for employees.”

When Seiwajyuku was closed down in 2019, it had about 15,000 students at more than 100 branches in Japan and overseas.

Inamori created what he called Amoeba Management, which has so far been introduced at about 700 companies worldwide. As explained on the Kyocera website:

“Amoeba Management begins with dividing an organization into small units called ‘amoebas.’ Each amoeba leader is responsible for drafting plans and goals for the unit. Amoebas achieve their goals through collaboration and the hard efforts of all their amoeba members. In this system, every employee plays a major role and voluntarily participates in managing the unit, achieving what is known as ‘Management by All.’”

An article by professors Ralph W Adler of the University of Otago in New Zealand and Toshiro Hiromoto of Hitotsubashi University in Japan, published in the MIT Sloan Management Review in 2012, noted that “Kyocera Corp’s distinctive management system seeks to promote profitable growth by extreme decentralization — with thousands of small, customer-focused business units.”

Inamori published more than 60 books in Japanese which have been translated into 21 languages and have sold more than 19 million copies. Respect the Divine and Love People: My Philosophy of Business Management was published in English in 1998.

From Zero to Kyocera: A Company Philosophy to Grow People and Organizations was published in 2020. It seems to beg for comparison with Peter Thiel’s Zero to One.

Inamori’s last work in English, Dream Small, Win Big: Life Lessons from Japan’s Preeminent Business Philosopher, was published earlier this year.

Inamori was a prolific writer on business philosophy. Photo: Facebook

Inamori was highly regarded in China as well. On August 30, the Chinese Communist Party’s mouthpiece Global Times wrote:

The death of Kazuo Inamori, a respected master of business management, was one of the most discussed topics on Chinese social media on Tuesday, with 310 million views as of press time.

Inamori, well-known in China and deemed a role model for Chinese entrepreneurs from tycoons to rank-and-file business owners, was also remembered for his friendliness toward China, including his charity work in China.

Li Tianguo, an associate professor at the National Institute of International Strategy, told the Global Times that one reason for Chinese people’s remembrance of Inamori has something to do with the fact that China-Japan relations are at a crossroads today.

I’ve been told that Kyocera is the hardest working company in Japan and I believe it. I never met him, but I got the impression from many visits to Kyocera that if an employee didn’t work for him 100%, that employee probably worked 110%.

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