Ignites Profitability
YASUAKI WAKUI
President
Kuraray Co., Ltd.
After 80 years in business, leading specialty chemical manufacturer Kuraray Co., Ltd., is going through a dramatic transformation.
“We are a unique company,” says President Yasuaki Wakui. “We began by creating chemical fibers, and we’re still known as a leader in that field. But over the past decade, we have refocused our efforts on the development of specialty chemicals, which is now our greatest strength.”
Decades ago, Kuraray researchers were the first in the world to mass-produce a synthetic PVA (polyvinyl alcohol) resin, and from it they produced the popular synthetic PVA fiber Kuralon. The success of Kuralon led to a procession of new fiber products. Along the way, the company built a strong R&D base to develop specialty chemicals, which ultimately led to the identity shift we see today.
“Quality attracts customers, and as the quality of our products is recognized, our sales will naturally grow.”
“Over 70% of our revenue now comes from non-fiber business,” Wakui says. “For example, from that same PVA-related technology we originally developed EVAL, a gas-barrier resin that became popular in food packaging. We also created a base film for polarizing film that is essential in the manufacture of LCD panels. With a global market share of around 80% for this film, Kuraray is a de facto world standard in LCD production.”
Despite rising prices for raw materials and fuels, Kuraray has miraculously chalked up a fifth straight year of record sales and profits. One key reason for this success is indisputable: good management.
Part of Wakui’s strategy includes overseas expansion. “Market growth in Japan will be limited, so our real growth must come from abroad. To meet that demand, we’ve expanded from one overseas plant to five in the past decade. In addition, we are using strategic, friendly M&A to build an even stronger, more focused group.”
Yet, the real key to success is not in new production facilities or M&A. Wakui has a long-term vision, something he calls “progressive refinement.” Simply put, it means redirecting the firm’s efforts toward high-quality, high-value-added products.
“Progressive refinement is not primarily aimed at quantitative expansion, but at improving the quality of both our products and management. Quality attracts customers, and as the quality of our products is recognized, our sales will naturally grow.”
In addition, he says, Kuraray needs to be constantly alert to the ongoing changes in its markets. “In order to survive, we must remain flexible in looking at both our products and our business portfolio. We will compete in terms of quality, originality and creating added value for our customers, and let go of businesses that don’t meet those criteria.”
Wakui’s strategy aims at specific, high-growth businesses. For example, the global auto industry remains strong, and automakers are continuing to shift from metal to high-grade plastics in search of lighter weight and better fuel efficiency. Kuraray’s EVAL resin is now widely used in plastic fuel tanks, and its heat- and abrasion-resistant Genestar™ resin, which is already found in countless electrical connectors, is expected to replace metal in a wide variety of applications.
“Our R&D pipeline is full of new products and applications in electronics, optoelectronics, automotive, energy and other fields. Many of them are ‘eco-products’ as well,” Wakui explains. “For example, we are now researching inorganic electroluminescence (EL). I dream of one day replacing the world’s fluorescent lights with this technology. Fluorescent lighting uses mercury, so switching to inorganic EL lighting, which is bright, stable, energy-saving and mercury-free, would have a huge positive impact on the environment.”
Clearly, Kuraray wants to change the world. It has both the R&D to achieve that goal and a smart, visionary executive to lead the way.
