The world is experiencing amazing change as it prepares for the 21st century. It is truly a very thrilling and exciting era.
  One of the shocks from these changes was the Y2K computer problem. The concept of an arithmetic system that accepts counting from "99" to "00" as logical is easy for human beings to accept. However, computers, even with their amazing progress and momentum, were unable to comprehend such a simple matter. Consequently, this led to an unpredictable problem and unimaginable blind spot in the transfer from the 1900s to 2000s.
  There were detailed reports that Western countries were quickly implementing "contingency programs" to manage computer systems should they crash. I do not wish to dwell on how slow Japan was in implementing measures to address this problem, as has been expressed in international evaluations of Japan. However, let us look at historical precedent. The Japanese army was known for its "iron-clad discipline" during World War II. However, after an almost uncontrollable successful push forward, it suddenly and easily collapsed. How could this be?
  One of the greatest factors for the Japanese defeat, which has been pointed out in various war history literatures, and which I am in complete agreement with, was the country's absolute lack of any sort of contingency plan.

  Are these really unpredictable situations and surprising changes? Change is not an occasional occurrence. It happens over and over again, and proceeds in continuum. Change is constant.
  At our company, I repeatedly stress the importance of a "sense of balance." The reason I do this is because the balance of a company is truly "unstable stability." The appreciation of the yen began two years before I assumed the presidency of Kato Spring (1987). The US dollar, which in 1985 had an average yen exchange rate of 233, suddenly rose to 141 or nearly 100 yen to the dollar. It was a truly amazing time.
  This sudden appreciation of the yen was primarily an assault on the Japanese export industry and caused the domestic unemployment rate to climb to a post World War II high (at the time) of 3.1% in May and June. Newspaper headlines became filled with other depressing news as well, including introduction of the alarming term "karoshi," which means death from overwork.
  On the other hand, that year also marked the arrival of the "Bubble Economy," initiated by the listing of NTT shares on the Tokyo Stock Exchange. This listing started a remarkable shift from products to money as an investment vehicle. NTT's share price rose dramatically reaching 3.18 million yen in April. During the same month, the stocks of Yamaichi Securities peaked at 3,130 yen per share, its highest level ever. Just two years ago (11 years later), shares were traded at 2 yen. The press conference called by Yamaichi to announce its voluntary dissolution is still fresh in my mind. It was sad to watch the tears well up in the president's eyes when he admitted that the company was unable to reorganize and thought about the lives of Yamaichi's 7,600 company members.

  The appreciation of the yen destroyed many companies at that time and continued to advance further in 1995 and 1996 with the US dollar temporarily reaching the 70-yen level at one point. As I will discuss later, the impact of this on Kato Spring, which had begun overseas operations early on, was not small.
  It is true that if our product had boasted a high market share of 70 or 80% in Japan at that time, we may not have been able to adjust to the changes. However, in the case, for example, of small parts, our company's share needs to be no more than 10 or 20%. If approached in this manner, the problems presented by changes in the environment resulting from the yen's appreciation were not as critical as those experienced by other export-oriented manufacturers.
  At that time, I appealed to Katoites through our in-house magazine, "Whether the yen is strong or weak, whether the economy is buoyant or slumping, a strong company will survive. Therefore, we will not form measures to combat the yen or the recession, we will forego measures to build a strong company. This step is, in itself, a countermeasure against yen appreciation."

  So what did I mean by the comment "build a strong company?" I was referring to the development of personnel, the development of products, the development of production technology and the development of sales strength. First and foremost, the focus of our challenge is on development strength. Whether it is people or products, we have still not revealed our full information potential. It is said that the number of nerve cells in the human brain is in the tens of billions, possibly more than 100 billion. These cells combine with an even larger number of synapses to form a massive network. However, the discovery and uses of such brain functions are still in a stage of infancy. Using the analogy of a "human train" for DNA, in which 3 billion characters are engraved, a renowned cerebral physiologist has named the engines driving this long train "desire" and "aspiration."
  Two years ago (1998), the Yokohama Bay Stars, a perennial cellar dweller in the Central League of Japanese professional baseball, came out of the blue to clinch their first title in 38 years. In the summer, when repeated victories placed them at the center of the battle for the lead, all of the players could be heard saying, "Baseball is fun." When I read this in the newspaper, I thought this is a remarkable "Win-Win" situation.
  My focus in the challenge of development lies with how to prepare for that situation and how to construct it.

  The work of each individual company member is also a story of continual change and challenge. Price competition and speed competition, including delivery deadlines, are not unique to any one industry. Even if process improvements are made, you have lost the competitiveness of speed and cost if, for example, your improvement in production speed is 30% while that of your rival is 35%. A dead-heat race is a battle where minutes and seconds count.
  However, is this everything? Is it not possible to generate a final product that is competitive by raising operating efficiency even through a reduction in machine speed or the incorporation of new concepts as the result of cooperation between manufacturing and sales divisions? Or, is there still not other valuable information yet sleeping in the area of product information; that is, materials and functions? Is there any possibility of creating additional value through systematization? Is there a possible route for proposing next-generation products?
  It is important to maintain the attitude that a large variety of means indicates that the field of new challenges will remain open. To progress one step further, why not think that the ultimate outcome of increased speed is to eliminate the process of increasing speed itself? Of course, a new product or new core concept that can overwhelm existing products cannot be generated that easily. However, the environment that cultivates such is clear. It is working under the philosophy of "Cheerful, Enjoyable, Lively, and Exciting. I did it!"
  I believe that the joy of people who live in the aforementioned manner will definitely unearth the hidden routes that exist here and there, and the direction of those two vital locomotives is the personal growth of each individual.

  A company in which each individual can feel his or her own growth is basically an organization where company members wish to continue to work. This enables them to have time to learn.
  Company members can always challenge themselves concerning various themes. It is part of our corporate culture and system that recognizes a Katoite who proudly says, "I did it!" upon attaining his/her goals. Even if the system doesn't allow for personal evaluations, there is an opportunity for "bathing in the spotlight" in some form. This is the culture being promoted by Kato Spring. It is a "Win-Win" dynamism.
  In order to accomplish this, I clearly iterated the "Declaration of a New Dictatorial President" to our executives in my third year as president.