From holding company to a single operating company (2009)

Folding away a selling point with no one left to invite

To file this integration under organisational slimming is to miss the core of the judgment. The decentralised federation had been designed in the first place as a selling point — the means by which strong regional retailers could be welcomed in as equals. But Gigas walked away and so did Bic Camera, and with no guest arriving, all that remained of the design was duplicated administration, showing up as selling and administrative expenses of 21% of sales in the year to March 2006. What Kubo Nobutaka went through with was the work of folding away, himself, the decentralised structure he had maintained as a vessel for others — having concluded that there was no one left to receive.

That said, becoming one company did not immediately make it stronger. The appliance market contracted just after the shift to single operation, in the reaction to subsidy-driven demand, and the consolidated result for the year to March 2013 fell into net loss. The effect of integration had to wait for the later rebuild through vertical integration before it showed as profit. Even so, the work of converting a federation of equals into one company with a single line of command prepared the ground on which the parent could later lead group reorganisations and capital alliances itself. Before you widen your scale, this reorganisation suggests, you have to bind together the scale you already have.