Canon's Mitarai's Anachronism: "Lifetime Employment" and "Seishain" Will Destroy Japan

2020.03.04 06:00

On February 3, 2020, the Camera & Imaging Products Association announced that total global shipments of digital cameras in 2020 are expected to reach approximately 11.67 million units, a decrease of 23.3% from 2019. This is a shocking decrease of less than one-tenth from the peak of about 121.46 million units in 2010.

Shipment value in 2020 is expected to be less than a quarter of the peak of approximately 2.16 trillion yen in 2008, and the shift to high-end models has not been successful. There is no doubt that many camera manufacturers (mostly Japanese companies) are facing a "No" from the market.

Although digital cameras are no longer selling well, it does not mean that people have stopped taking pictures and videos. In fact, they are taking more pictures than in the past. This is because many people now have smartphones with camera functions that are becoming increasingly sophisticated.

The total number of smartphones shipped worldwide in 2019 was about 1,371 million units, slightly down from about 1,402.6 million units in 2018, but remaining high at around 1.4 billion units since 2015. It is easy to understand how smartphones have quickly penetrated our lives and become the first choice for many people to take photos and videos.

Let's take a look at the difference between Nikon and Canon, the two-tops in the outdated SLR market, which are seen as facing an existential crisis, and Sony, which is poised to disrupt them.

Sony has the world's largest share of the global market for image sensors, the key device in digital cameras and smartphones, by a wide margin. Not only does it supply products to smartphone makers with the top share of the global market, but it also produces its own smartphones, although its market share is not as high. The fact that Sony is surviving in the rapidly changing and large smartphone industry suggests that they have learned the OODA loop, a way of thinking to survive in the age of VUCA, which I introduced in my previous article.

That Sony is making decisions at high speed and moving flexibly is evidenced by the fact that they have revised their press release for the launch of the α9, the first full-frame mirrorless camera flagship launched in 2017, three times in a short period of time after the release.

Canon CEO Fujio Mitarai insisted on "lifetime employment," claiming that "if you can devote yourself to a job with long-term employment and peace of mind, you will become a professional in your field. In an era of slow change, the problem still did not manifest itself. However, what "lifetime employment" created was a "Nomenklatura" in the name of low-level "regular employees". This is evidenced by the fact that Japanese companies with old structures have been suffering from deteriorating business performance and frequent large-scale layoffs.

During his tenure as chairman of Nippon Keidanren (May 2006-May 2010), Mr. Fujio Mitarai strongly advocated "stable employment. I must say that this is an anachronism. The Soviet Union, which was dominated by "nomenklatura," collapsed. Japan, which did not abolish "regular employees," the root of all evil, did not promote the mobility of human resources, and did not increase the number of "professionals," has become a hopeless society, similar to the end of the Soviet Union.

A look at Sony's mid-career recruiting page shows that job seekers can choose not only "lifetime employment" with no fixed term of employment, but also "project/employment contract employees," a "way of working that contributes to the company by specializing in an area of expertise and setting the term of employment according to work assignments. This is a "lifetime employment" concept. Neither Nikon nor Canon could confirm this kind of recruitment of human resources, which is based on a working style that rejects "lifetime employment.

Since we are now in the age of VUCA, many job seekers do not expect "lifetime employment," and companies that only recruit "nomenklatura" in the name of "regular employees" are not attractive at all. Unless we eliminate "lifetime employment" and promote the mobility of human resources, eliminate "regular employees" and increase the number of "professionals," Japan's poverty will not stop.

The courage to respond to drastic changes in the external environment and to reject the ways of doing things that have worked in the past is required of the managers of Japanese companies with old-fashioned structures.

first appearance : AGORA