The “specialisation campaign”: narrowing diversification, choosing quality (1979)

Turning an early fall into a management asset

The heart of this decision lies in converting the injury of being the first in the industry to sink into loss into a management asset, by shifting from volume to quality. President Nagashima Takeo put a constitution able to endure a downturn ahead of profits in a boom, moving from cost-centred thinking to an emphasis on quality and narrowing the spread of diversification into specialisation. Combining plant sales with new construction, holding headcount down, concentrating resources on items that could compete on quality — an accumulation of unglamorous, steady substitutions can be seen as what supported the recovery in earning power.

This way of thinking — not chasing volume but seeking quality — runs through the later Nitto Boseki as well. The business selection that began with the 1965 loss nurtured the non-textile divisions and led on to the structural reform of the 1990s, when cotton spinning itself was let go and resources narrowed to glass fibre. A management pattern of continually asking what to discard and where to concentrate took shape within this specialisation campaign. Whether an early fall can be turned into the wisdom to recover repeatedly has remained this materials maker’s central question.