Business sentiment

Author: Ito Masatoshi / Country: Mainland China
Publisher:
Publish Date: 2006-08-01
Features: Mr. Ito Masatoshi is the founder of the famous Japanese company Ito-Yokado Group. The Ito-Yokado Group currently operates 12,000 stores in Japan, employs 320,000 staff, and generates over 6 trillion yen in annual revenue, consistently ranking among the top companies in Japan for many years. It represents the forefront of Japan's retail industry. This book collects Mr. Ito's articles on business wisdom, including life philosophies such as "honesty and trustworthiness," "humility in dealing with others," "gratitude in the heart," "repaying kindness," "having a sense of shame," "frequently reflecting on oneself," "never forgetting the spirit of entrepreneurship," "thinking of danger in times of peace," "fearless of starting from scratch," and "daring to challenge." I believe these principles are not only essential for businesspeople but also for every person in life.
The season of rebirth and renewal is a time when people look forward to the future, embrace hope, and weave their dreams. However, every year at this time, a sense of anxiety descends upon me. I am naturally timid and overly concerned, and this makes me even more uneasy, leaving me lost. The reason is the annual new employee ceremony. In 2003, the Ito-Yokado Group welcomed over 700 new young employees, and the ceremony was held on March 13. Since stepping down from the position of general manager, I no longer need to deliver welcoming speeches on stage. Yet, whenever I sit on the rostrum, gazing at the new members filling the entire hall—those of my grandchild's age—I am overcome with the same thoughts as in the past. "Can we take responsibility for their entire lives?" "Is our company one they can entrust their futures to?"
The Ito-Yokado Group, centered around Ito-Yokado supermarkets, has a total sales revenue of approximately 6 trillion yen. If we include the franchisees of 7-Eleven convenience stores and the part-time employees in various group companies, this large enterprise employs about 320,000 staff. Ito-Yokado is widely recognized as a financially sound and high-performing corporate group. But in my heart, today's Ito-Yokado is no different from the small, family-run business it was before going public. Until the 1960s (Showa 40s), I repeatedly instructed the head of human resources to maintain a gender ratio of three men to seven women. This was because female employees would naturally resign after marriage, spending only a few years at the company. Men, on the other hand, were the breadwinners of their families. Lifelong employment was a given, so male employees would stay with one company for three or four decades. I lacked confidence in ensuring the livelihoods of male employees bearing the weight of life, so I asked the human resources department to control the ratio.
Some might think that as a company grows, the risk of bankruptcy decreases, and one can rest easy. But I don't believe that. In fact, I hold the opposite view. I believe that as a company gets bigger and employs more people, the responsibilities it carries increase exponentially. I was born in 1924 (Taisho 13), almost a contemporary of the Showa era, and have long since passed the 77th birthday celebrated as "kissho" (a traditional Japanese milestone). From the time I could remember, the shadow of the economic crisis (Showa Crisis) had not yet lifted, and the war was approaching. It was a dark age. The days of ordinary Tokyo merchants were spent trying to fill their bellies. The outbreak of the "July 7 Incident" (1937, Showa 12) spurred military production and wartime economy, slightly improving people's lives. But the good times didn't last long. After the Pacific War broke out, the supplies around me vanished without a trace. The wartime profiteers, post-war speculators, products of the high-growth period, and the bubble-era companies and financial institutions—like countless bubbles—flipped and vanished in the waves of time. Whenever I think of this, I am even more deeply reminded of how difficult it was to navigate that turbulent era.
The history of Ito-Yokado began with a small, 2-tsubo (1 tsubo is approximately 3.3 square meters) Western goods store in Chiyoda, Tokyo, that survived the war. It was an era of scarcity, and goods would sell out the moment they were put on display. During the post-war recovery and high-growth periods, influenced by mass production and mass consumption, sales climbed by 30% to 50% annually. Today, however, with material abundance, goods are often unsold, and services and finance have become the center of consumption. The transition between several eras has taken only half a century.
I started helping with my family's business when I was 21. To me, my mother and older brother were not only role models in business but also my mentors, teaching me the true essence of commerce and the way of life. Of course, their help was not the only factor—we also relied on the support of customers, financial institutions, and countless others. Among them were the partners who shared the hardships during the early days of entrepreneurship and our employees. The success of Ito-Yokado today is due to the guidance and support of countless friends from all walks of life.
Eighty years of life have further strengthened my conviction: the foundation of business is to remember these words: "Customers will not come to buy on their own," "Suppliers will not come to deliver on their own," and "Banks will not offer loans unilaterally." Precisely because of this, integrity is paramount. Credit guarantees are neither money nor material but rather a person's honesty, uprightness, and meticulousness.
Today, Japan is facing a period of transformation in every field. After the war, Japan developed into a leading economic power in the world—something no one could have predicted at the time. Yet behind this miraculous economic boom lies a hidden crisis. Perhaps today's prosperity has already surpassed the limits of imagination. The dazzling image of wealth cannot hide the many contradictions, such as political, administrative, or financial ones. I believe the root of all conflicts lies in human problems. The Japanese have forgotten to be grateful for the ability to eat, wear, and live comfortably, failing to realize how extravagant and wasteful they are. Many even see extravagance as natural. Including myself, some people find it hard to believe that we can enjoy such a happy life today.
"National Socialism," established as a wartime system, did not change much after the war and indeed achieved a "middle-class society for all." But unreasonable success is bound to meet retribution. Pride leads to downfall, and prosperity breeds decline—this is the law of the world. Having forgotten gratitude and overestimating one's own strength, the fate of such people, regardless of east or west, past or present, is the same. The people in the Old Testament who attempted to build a tower to reach the heavens and thus angered the gods have become symbols of overconfidence. I often ask myself if I too have become foolish in this way. That is why I always feel something daunting waiting ahead.
Here, I wish to record my reflections and look back on the Showa era as a businessman. P3-6