Sustainability Nippon Thompson's Value Creation: Business Strategy
Our Group's business is growing worldwide through the supply of machine components that are indispensable to all industries, from electronics-related industries to machine tools and transportation equipment. The core of our value creation is that we provide high-quality products that quickly meet the challenges and demands of our customers.
The IKO brand is highly credible and trusted due to the accumulation of value creation through our sincere activity to solve customers' problems in collaboration with external partners, as well as the business units responsible for the value chain.
At the same time, global society is undergoing a period of historic change, including a digital shift, the evolution of AI and IoT, and social demand for sustainability, including the SDGs. We will address issues that could be potential risks, while continuing to take on the challenge of new growth opportunities where we could leverage the Group's strengths to achieve sustainable value creation.
SWOT Analysis
Direction of Company-wide Strategies
Under Medium-Term Business Plan 2023, in addition to further deepening the strengths developed by each business segment, we will continue with the balanced implementation of expanding and embracing change to respond to medium- and long-term social changes, with the aim of realizing our vision, IKO VISION 2030.
Sales Department
We would like to expand ourselves as the niche leader from a global perspective and provide a roadmap for growth as well.
Toshinao Kimura
Managing Director
In Charge of Sales Department
Environmental Awareness and Issues
The Needle roller bearing series is the legacy of the IKO brand, and the driving force behind our group's growth as a profit generating source since the Company’s establishment. The Linear motion rolling guide series and mechatronics series are expected to grow significantly in the future as we address technological innovations, such as state-of-the-art semiconductor manufacturing equipment and advanced medical equipment. Our broad, well-balanced product lineup, geared toward sustainable growth, is the result of our Sales Department’s attentive management of customer feedback, which changes over time, as well as our ability to develop products while foreseeing market trends.
To achieve carbon-neutrality on a global scale, there has been a rapid increase in demand for downsizing machinery and equipment to reduce CO2 emissions. Therefore, we anticipate customer expectations will grow more and more in the future for compact products, an area in which we specialize. Considering these circumstances, we recognize that the mission of IKO is to align ourselves with customers’ requirements for sustainable management and expand our customer perspective solution proposals across the globe.
Features and Strengths
The IKO Group has 48 domestic and overseas sales offices (22 in Japan and 26 overseas), and we are closely attuned to our customers, accurately identifying the needs of each country, industry and customer, launching strategic products that aim to be the niche leader from a global perspective, concentrating resources in key regions and strengthening our system by improving direct sales. We are also strengthening partnerships with highly specialized trading companies dedicated to specific customers and industries, while creating a structure that enables us to provide more extensive and attentive support.
With our legacy as a bearing trading company founded in 1950, the DNA of our Company has been firmly inherited by our current Sales Department. With a strong belief in proposal-based sales activities, and the customer’s perspective, we have earned a high level of trust by constantly seeking to add value for our customers, not only by selling our own products, but also by providing sales and services for complete sets of products and equipment in collaboration with our alliance partners.
Policy and Future Initiatives for Achieving the Long-Term Vision IKO VISION 2030
A Roadmap for Growth
To achieve the goals of IKO VISION 2030, we recognize that it is essential to accurately read market trends. The Sales Department has a key role in guiding companywide growth strategies, so this department has formulated the “IKO Compass”, a long-term demand forecast model for important products. As the name suggests, the “IKO Compass” has been positioned as the Group’s “compass” that points the IKO Group in the right direction. This direction has been shared with not only the Production Department but also the Engineering Department and the Management Department, and each department is developing policies that are in sync with the compass. In a fast-changing era, it is crucial to promptly communicate company policies from a global perspective. Therefore, we continually update the “IKO Compass” to immediately share throughout the Group the latest information on our competitors, in addition to customer trends in Japan and overseas. We believe it is critical for us to capture opportunities and minimize risk by staying ahead of market trends, as well as to maintain definite policies for realizing our vision, while adapting to change.
Reinforcing IKO Mech-unit Business Segment and Adding Value
As recent labor shortages and supply chain issues have come under close scrutiny, customers’ needs also continue to change. Particularly in the FA (factory automation) equipment industry, there has been a rapid increase in cases where the design and manufacture of complete sets of modules and equipment is outsourced, something that was usually done in-house. As a result, in addition to the functionality and performance of bearing products, requirements are growing to provide specialized units. Seeing this change as a growth opportunity for IKO Mech-unit Business, we will grow this segment by reinforcing our collaboration with partner companies that have a wide range of technologies. We recently introduced the IKO Partner Company Recognition System to conduct thorough, and independent inspections of partner companies' technologies. This system ensures both quality and environmental responsiveness. In this way, we will enhance our customers' feeling of security and provide additional value.
IKO Mech-unit manufacturing examples
Alongside our partner companies, we use our many years of mechatronics technologies to create the optimal IKO Mech-unit.
Technology Development Department
Shin Kasahara
Managing Director
In Charge of Technology
Environmental Awareness and Issues
Bearings and linear motion rolling guides are mechanical components for enabling precise and smooth movement. By reducing heat generation and energy loss caused by friction, they help improve the performance of all types of machinery and equipment.
As the digital shift accelerates throughout the world, next-generation technologies such as IoT, AI, and smart factories are developing significantly, so demand for our products is expected to grow continuously. In particular, the miniaturization of semiconductors and advancements in medical equipment have increased the need for bearings and components with superior specifications, such as small size, high functionality, and high accuracy, and the needs for each application are becoming far more segmented, making the technical issues more diverse and complex.
We aim to meet a wide range of requirements such as high load capacity, high rigidity, long life, low friction, low vibration, low dust generation, environmental temperature resistance, and vacuum resistance. Drawing from our expertise in roller guidance and small sizing technology, we will continue and deepen our R&D to achieve these goals.
Features and Strengths
In the Technology Development Department, we prioritize our customers' requests and strive to maintain the upmost integrity capabilities in resolving any issues.
Our strong technological capabilities that support the development of the IKO brand for top-quality and highly precise products are the result of the many years of experience and knowhow that we have accumulated by working closely with the Production Department to fulfill our customers’ requirements and overcome obstacles one by one.
Members of our Technology Development Department not only visit customers directly, but also actively communicate with customers by attending exhibitions held throughout the country. We thoroughly examine the issues raised by customers in the course of these activities and develop optimal solutions.
The Technology Development Department is taking on the challenge of creating new de facto standards that start with building relationships of trust with customers.
Policy and Future Initiatives for Achieving the Long-Term Vision IKO VISION 2030
A Balanced Combination of Market In and Product Out Approaches
In the Technology Development Department, our initiatives are aligned with the key missions for new product development that more thoroughly meet existing market needs, strengthen our brand, and create new value.
In terms of new product development, we announced the LRX ZERO, which achieves ultra-high precision guide performance, at the Japan International Machine Tool Fair last year. With this product, we intend to meet the demands of customers, particularly from machine tool manufacturers who have been using our linear roller ways for many years. In the mechatronics series, we are developing products that combine our expertise in small linear motion rolling guides and linear motors. We are also focusing on the development of custom products for customers as well as modular unit products. We will strive to differentiate us from other companies by achieving a balance between improvement (market in) development that accurately identifies needs and issues through dialogue with customers and proposal (product out) development that identifies latent needs that customers are not yet aware of, with prototypes of technology-driven products.
Using Open Innovation to Deepen Technology
We continue to explore new technologies and new business segments as we work to achieve our long-term vision. In addition, we aim to develop new application products while not only relying on in-house technologies but also strengthening cooperation with universities, research institutions, and other companies. A prime example is liquid crystal lubricant, which we began jointly developing with the University of Yamanashi in 2016. This lubricant has excellent properties for special appli- cations such as evaporation and outgas/dust generation. It is expected to expand the applicability of bearing mechanisms in electronic components, semiconductor manufacturing equipment, and more. In this way, we will embrace open innovation as a way of deepening technology and creating value that does not exist anywhere else in the world.
Production Department
We aspire to evolve IKO's unique expertise globally to create high-quality products.
Nobuya Hideshima
Senior Managing Director
In Charge of Production Department
Tooru Okajima
Managing Director
Deputy in Charge of Production Department
Environmental Awareness and Issues
Traditionally, the bearing industry was centered on mass production, mainly for the automotive industry. However, this is changing with the recent shift to EVs. With this change, we expect steady demand for the needle roller bearing series in areas that we have been focusing on. We are upgrading our multi- product manufacturing system to strengthen our competitiveness. In the linear motion rolling guide series, the main challenge is to boost supply in response to significant market growth, particularly in the semiconductor industry, as well as to reinforce our “swift response capability” to address the fluctuating business cycle.
To establish a sustainable supply chain, it is necessary to have production and purchasing that consider the environment and human rights. A healthy, safe, and rewarding work environment is another inevitable challenge. We are committed to our mission of “contributing to the global community through local-based manufacturing.”
Features and Strengths
Our greatest strength in manufacturing is our quality. It is our thorough commitment to high quality that has enabled us to gain the trust of our customers. In addition, our multi-product response is another source of the Group’s value. To meet customers’ diverse requirements, one of the biggest challenges is assessing how flexibly the Production Department can respond.
In the series of Needle roller bearings, we have developed a wide range of products through to small-lot production and inventory optimization. We quickly provide these products to meet customer requirements. At the same time, in the linear motion rolling guide series, we accept orders for single customized products, including rail lengths in 1-mm increments, enabling a detailed response to our customers’ needs.
The strengths of IKO that support the IKO brand are our commitment to high quality and our unique manufacturing expertise, including equipment development, process design, production and inventory planning, and collaboration with suppliers, which enables us to optimally respond to requirements for a diverse range of products and customization.
Policy and Future Initiatives for Achieving the Long-Term Vision IKO VISION 2030
Creating an Optimal Global System through Organizational Changes—A System That Can Swiftly Adapt to Customers’ Expectations
This April, the Production Department was reorganized based on the product series. By integrating the management of every process for each product series, from prototyping to quality and production management, we will reinforce control across the supply chain and improve our ‟swift response capability” to promptly, accurately, and flexibly reflect customers’ requirements. This is the reason why we also recently established the Manufacturing Innovation and Production Management.
This new department, in addition to planning our future global production system, is responsible for developing new technologies and processes, including those related to automation, and is focused on building a strong foundation for future growth.
We will reinforce our integrated initiatives across three production sites—in Japan, Vietnam, and China—as well as to build optimized production systems unique to IKO while maximizing the features of each region. Going forward, we will continue to improve our production systems and technological strengths for a quick response to customers’ diverse expectations, while improving our corporate value.
IKO-GP Committee—Aiming to Develop Human Resources Who Can Support the Foundations of Our Manufacturing Department
The IKO-GP (Gemba Power) Committee allows supervisors at manufacturing sites to collaborate on making improvements, while also promoting the development of young employees and strengthening our organization. Site supervisors representing each factory get together for in-depth discussions on shared targets, including the Company’s policies and long-term vision. In this way, they are making every effort to take the lead in uncovering and addressing issues. Through this enhanced collaboration, we are developing the ability to improve manufacturing processes not only from a production perspective but also with a comprehensive understanding of the entire organization.
The IKO-GP Committee consists of all supervisors, including the chairperson, and is organized into subcommittees based on the Six Commitments that the Production Department values. Through these subcommittees, members share their expertise and experience, as they conduct detailed analyses to help resolve issues. In the future, we will also promote interactions with employees from our global offices. By having people from different cultures and backgrounds work together to address issues, we are fulfilling our duty to create new value.
Embodying the IKO brand through innovation, know-how, and originality, we will make steady progress on creating a global production system that no other company can replicate.
