Re-merging the three firms split by the zaibatsu breakup (1964)

How to wield the scale that undoing the split restored

The core of this decision was to take an organization that an external force — the breakup of the zaibatsu — had artificially cut into three, and, after fifteen years apart, to gather it back into one under the pressure of international competition. Given that the aim of the merger lay less in scale itself than in reconciling the duplicated investment and overlapping research scattered across the group, it can be read as at once a decision to expand and a decision to tidy up — to re-assemble the severed businesses for an age of international competition. In binding the skeleton of Japan’s heavy industry back into a single company, it was a move that stands as a symbol of the postwar reordering of industry.

Yet the sheer size gathered into one organization did not simply go on being a strength. The scale the reunion produced became the foundation for the policy-linked businesses of defence, energy and aerospace; but in the 1980s, amid the “lighter, thinner, shorter, smaller” headwind away from heavy industry, the company was faulted for the organizational rigidity that came with being a giant vessel, and around 2000 it passed through a spell of net losses brought on by weak overseas plant orders. How to wield, nimbly and within a changing market, the scale won by undoing the split — the 1964 reunion looks to have left that question with Mitsubishi Heavy Industries’ management for a long time to come.