Emergency rebuild after Lehman and the break with the general-electric model (2009)

From the second brink

The core of the Kawamura reform can be seen less in filling the financial hole itself than in using the crisis as a pretext to dismantle the “sanctuaries.” Hitachi had a history, in 1950 too, of stopping production at every plant to push through the cut of 8,500 people and recovering from the edge of bankruptcy. Only when driven to the verge of collapse does a hand reach the structures that cannot be touched in normal times — a pattern common to both crises, which reflects, from its underside, how hard it is for a large company to remake itself.

That said, taking down the signboard and settling on the next way to earn are separate tasks. Having shed the frame of the general-electric maker, Hitachi went on to swap its earners toward energy and digital through vast acquisitions such as ABB’s power grids and GlobalLogic. How far a successor could hold the line of “reason over sentiment” that Kawamura drew remained the question. The inquiry that began from the ¥788 billion loss is one that still carries over to today’s Hitachi, which keeps trading its businesses in and out.