Matsushita Electric and how it changed my vision on ̶i̶̶̶n̶̶̶d̶̶̶u̶̶̶s̶̶̶t̶̶̶r̶̶̶y̶̶̶ life
The title might sound a little pretentious but bear with me. This was one of the finest books I have read in a while not only because it gave some practical knowledge and techniques to implement, but it also helped me to see the bigger picture, to put everything into perspective: how things where in 1918 and how much they changed now, in 2019. So, how on Earth did I think to choose a book written in 1997? Well, I guess it was really a stroke of luck that hit me because I have attended an event with PwC right before Christmas and they gave us a couple of books as a gift.
At first, I thought “Yeah, right… I’’m gonna read these when I’m dead”, but then I checked the book list and saw that one of the books I received was worth 3 points, and it was quite light from appearance. Turned out I was completely mistaken because Matsushita Leadership was one of the hardest books I had to read in the last year. The problem was not the language, but the content: I was projecting myself on the personality of the protagonist, but with every page I read, I realized how many things I was getting wrong. Maybe it was destiny, or maybe it was just a coincidence, but this was the book I didn’t know I needed.
The story starts by showing us the Matsushita family, just before Konosuke was born, in 1894. A wealthy and well-respected name in the small village of Wasa, part of Wakayama region. His father, Masakusu Matsushita owned a big plot of farmland and had 7 other children before Konosuke. In a cruel twist of events, Masakusu lost all of the family’s fortune buying stock options on rice exchange. As if that wasn’t enough, the oldest son of the family, Isaburo, died a few months later. The whole family was forced to move to the city of Wakayama to find work.
Bad luck never stopped following the family, as the children of Masakusu were dying one-by-one, eventually only leaving Konosuke, who was 16 at the time. His father sent him to a small bike shop to become an apprentice, learn the craft and then open his own bike shop later on. That is where Konosuke learned a lot about business, the owner serving as a father figure to him, showing him love but also punishing him for his mistakes. Later in his life, we will see this effect in his work relationships with his employees.
After finishing his training at the bike shop, Konosuke, now 18 years of age, found a job as a junior technician at Osaka Electric Light Company. This was around 1907 when electricity was only accessible to the wealthy families of Japan. He slowly progressed, learning more and more about electricity and electronic equipment. One day, he saw how flawed were the light sockets they used, so he came up with a new design and presented the prototype to his boss at the time. However, Konosuke’s superior was not impressed and had little interest in developing such technology.
That’s when we first see the courage of Konosuke Matsushita: he resigned from his position, something that at that time in Japan, was considered suicide. At 22, he started his own company in the basement of his tenant. He started only with his wife and his brother-in-law, Toshio Iue, helping him. Toshio later in life founded Sanyo, a direct competitor of Matsushita Electric, the company Konosuke founded. They first started producing light sockets, but no one wanted to be distributors for their product. They were saved in the last minute by an order for 1000 insulator plates for electric fans. Slowly, but surely, Matsushita grew his business.
Then, disaster struck Japan. The economic crisis struck every major sector of the economy and all businesses were affected. All but one. Matsushita Electric Company. As it turned out, Konosuke did the opposite of what all of his competitors did. He didn’t fire a single person during the whole crisis and actually talked to his employees, explained the situation to them and told they will all have to work harder in order to keep the company afloat. They later became the market leaders because when everyone was struggling to get back on their feet, Matsushita was already 5 steps ahead.
However, the worst was yet to come. World War 2 started, and Matsushita Electric Company was forced to produce tanks, airplanes, and electronics for the military, all in the detriment of the business. When Japan lost, the Americans took over the economic system and wanted to start with a clean slate, so they declared the management of all the big companies “Zaibatsu” or “Dishonorable”. This way, they would make sure that the power was no longer in the hands of the old, well-known Chinese families.
Konosuke Matsushita was removed from the company in 1946, and the employees of all Japanese companies unionized. All of the workers agreed on the change of leadership, now receiving better working conditions from their American leaders. All except one group, from one particular company.
15000 employees of Matsushita Electric signed a request addressed to prime-minister Jiro Hoshijima in which they asked for their leader, Konosuke Matsushita, to be reinstated and continue his work at the company. The first reaction of the prime minister was to laugh out loud. Then he granted them their wish. Matsushita was no longer “Zaibatsu”.
In the last years of his life, Konosuke dedicated his time to teaching his son-in-law how to run the company and founded the Matsushita Institute for Managerial Education. His company, in 2006, changed its name to the brand they were using to sell their products, maybe you have heard of them: Panasonic. Panasonic acquired the company of Toshio Iue, Sanyo, and became the largest electronics manufacturer in Japan and still maintains that title today.
Konosuke Matsushita died at 10:00 A.M., 27th of April, 1989, at the age of 94, leaving behind a legacy like no other. Even nowadays, when you ask Japanese people who Matsushita was, they answer with just a single, powerful word: “God”.
This book was like no other. It gave a glimpse into the personal life of one of the most influential people of the XX century. I learned how difficult it was for him to run his company, having a lung disease from the young age of 22. However, this is where we see his strong will: each time the company was at its worst, Matsushita felt healthy, knowing there are things left for him to do and to improve. He thrived on the idea that success shouldn’t go to your head and to always stay focused on your mission: Rid the world of inequality.
I can’t compare Matsushita Leadership to any book I have read in the past because I have never read the profile of an entrepreneur in so much detail. I only focused on techniques, books like Lean Startup and Business Model Generation, that teach you ways to do things. These books don’t even compare to Matsushita Leadership. In this book, you enter the mind of one of the greatest leaders of our modern times. Even if it is a little outdated in its content (the book was written in 1997, so eh…), the principles and values Konosuke Matsushita stood for are still valuable today, and even harder to find.
One thing that I don’t see fitting into the 21st century from this book, however, was the tough love Konosuke showed his employees. Often times he would get mad as hell and start screaming at his workers and the next one started asking them favors. This is no longer tolerable in our society, no matter how efficent it is. I think this is where the value of freedom comes into the equation, as it is one of the basic values of the century.
A few principles stuck with me after I read this book: Never fire people. The best resource you have in a company is your team. Even in the hardest times of your company’s life, you should cut every corner, reduce every cost, maximize every opportunity, but don’t fire people. Also, choose a mission, one in which you really believe. And make your team aware of it. Make them part of your story, show them that they are as important to the mission as you are.
I think this is the kind of book you should read for inspiration. I would recommend it to anyone who has trouble finding their way thanks to the inspiring story that shows the triumph over adversity of Konosuke Matsushita. This should be a mandatory read in our book list. This should be a mandatory read in our schools. This should be a mandatory read in our society. This should be a mandatory read in our hearts. Because what this simple man from Wasa, Wakayama achieved, the standards he set and his view on the world are the things that lead to Japan’s revival after the Second World War and placed it in the top 10 countries on the planet.
I have applied the principles of Matsushita Leadership in my personal life and in my work life. And then realized that they were inter-connected. That if I tried to apply those principles only to my work life, I would fail miserably because of my lack of authenticity. I started communicating more with my teammates, tried to show them a part of me they never knew, expected more of them, and inform them of our mission with every chance I get. There are still a lot of new things I want to try and apply, but first I’m taking some baby steps 😀
In conclusion, I would like to say just one thing. I think we owe Konosuke Matsushita, the “God” of management, more than we know. He transformed the way a company should be run, at first led by selfish reasons, and then by his wish to better himself and the society. He changed the perception from the “Big Bad Boss” to the Leader. And if I could, I would personally thank him for that because that is my biggest struggle right now and I think I just solved it.