If You’re Not the No.1 in the World, You Can’t Be No.1 in Japan / 1952

If You’re Not the No.1 in the World, You Can’t Be No.1 in Japan / 1952

"Rather than use money, use your wisdom."

This was a favorite saying of Mr. Honda to his engineers, but there was one big problem he couldn’t solve no matter how hard he thought about it–machine tools. To improve the specification of components, you need high-precision machine tools. Even though the company was performing marvelously, the Dream E-Type was a big hit and sales of the Cub F-Type were positively explosive, Mr. Honda was still totally dissatisfied with the level of precision of his components. Although he wanted to be number one in the world, he realized more than anyone else that he would never be able to make a breakthrough using his existing machine tools. In June 1952, Honda carried out its second capital increase bringing the company’s capitalization to 6 million yen and Fujisawa became senior managing director. In October of the same year, the company decided on a program to invest as much as 450 million yen in the latest imported machine tools.

Photo

Having decided to import 450 million yen worth of machine tools, Honda left for America in November 1952. Here he is shown with family members who came to see him off at Haneda Airport.

The October 1952 issue of Honda Monthly carried an article by Mr. Honda entitled "Taking a global perspective." The article gave more passionate expression than usual to the main tenets of his long-held beliefs.

"I have always said that all my efforts are devoted to my wish to satisfy my customers by manufacturing good-quality products at low prices. However, I do not think we have yet completely succeeded in achieving this aim in terms of capacity, design, or price. In September we produced more than 1,000 ‘Dreams’ and production of the ‘Cub’ broke through the 5,000 barrier, but although we are now the top makers in Japan, I feel an unbearable sense of shame when I look at our present level of performance from a global perspective. As I remarked in my New Year greeting, my goal is to manufacture products which exceed international standards. I am well aware that there is still a huge gap between our products and those of advanced countries like Britain and the U.S.A. In order to realize our creativity and inventiveness, we need the very best machinery. There is an old saying that ‘A bad workman blames his tools’. I have taken a major decision to purchase the world’s best machine tools. The order has already been placed and we are now dealing with the import license formalities. The investment will come to 300 million yen. I simply cannot go along with the idea that in order to protect our jobs we should set limits on the import of foreign cars. Technological competition should be conducted by technological means. No matter what barriers we put in their way, quality products will always find a way in. Good products know no national boundaries. ‘The best in Japan’ means nothing when you are only comparing yourself with the rest of Japan. The moment a better foreign product is imported, that kind of ‘Number One in Japan’ is toppled. Being ‘Number One in Japan’ is but a stage on the way to being ‘Number One in the world.’"

Looking at these words half a century later with the benefit of hindsight, it is surprising and yet understandable that a corporation with a capitalization of only 6 million yen should have wanted to import machine tools on such a massive scale. But seen from a contemporary perspective it must have looked like an overreaching, reckless adventure. Nevertheless, although we can still sense the passion of Honda’s words, they really reflect a technician’s cool, logical mind. They are an expression of freedom, autonomy and independence of thought. Although Honda belonged to what was called "the war generation," he was an example of a hitherto unknown, new kind of Japanese who looked at things from a global perspective.

"I heard the word ‘world’ from Mr. Honda very early on," says Shirai. "Soon after I joined the company in summer 1950, he was talking about die-casting. ‘The Ministry of International Trade and Industry is talking about giving us a grant of 400,000 yen if we can demonstrate the advantages of die-casting aluminum components instead of casting them in sand molds. Hurry up and write a report!’ I was suddenly told. I immediately made a comparison of difference in cost and quality between the two methods and demonstrated that die-casting was the superior technique for mass-production, but Honda’s level of output was not enough to benefit from it. We were making 100 units a month, or at most 200. Die-casting offered no cost advantages unless you were making at least 1,000 units and preferably 10,000. I was in a real fix, but I had to report to Mr. Honda ‘No matter how you work the figures, sand-casting is better for us than die-casting. I can’t write that die-casting is better.’

"Maybe it was because Shirai had worked out his figures in such detail, but Mr. Honda did not show any signs of anger when he saw Shirai’s reply. Instead he explained very patiently: ‘What you say is true under the present circumstances. It is quicker and cheaper for the workers to sand-cast the components. But Japan’s future depends on industrialization. If we have to trade with the rest of the world, the most important things will be mass-production and consistency of quality. That’s why we have always used die-casting even though we know it is inconvenient. Make sure that your report emphasizes this point.’ To be quite frank, I was flabbergasted to hear this from the boss of a small factory. He really meant it when he talked about ‘trading with the rest of the world,’ something even presidents of big corporations did not mention. Although I was amazed, I realized that he was no mere workman turned engineer. The scale of his thinking was quite different. So I wrote the report the way he wanted it."

The grant was approved without any difficulty.

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