This year (1999) Kato Spring is celebrating its 53rd anniversary, and looking back over the years, we have taken three broad steps concerning our business domains:

• First, the era of spring manufacturing with a focus on coil springs
• Second, the era of wire springs, flat springs and precision parts and components that contain a variety of assembled products
• Third, the era of precision engineering

Currently, we are aggressively pursuing the expansion of business targeting these diversifying needs with a focus on precision engineering.
  To visualize this, let's say we have a graph: on the vertical axis are customers from industries like automobiles, household appliances and electronic equipment, and on the horizontal axis is precision engineering. Every intersection of this matrix presents individual markets we should target. However, this is only the start.
  Next are the functions:

• Selection of a growing target market
• Development strengths that can make proposals to customers that allow us to accurately understand the needs and wants of growing markets
• Engineering and production strengths that can propose and provide products that are greater than customer expectations

It is a combination of these functions as a form of flexible engineering that forms the new business domain immediately in front of us.
  Therefore, the greatest theme of our current business scenario is not only making precise shapes and dimensional specifications, it is how to create "skills" and "knowledge" that result in the development of systems that surpass the expectations of customers by generating optimum precision in addition to "new technology."

  The Kato Group currently manufactures more than 10,000 products at a rate of 700 million components per month, and ships them to customers in Japan and overseas. However, since these are not regular finished products, they probably rarely appear in front of the reader. This is because the various precision parts we manufacture are goods provided to companies that sell products and services for which our products are utilized to generate value. The individuals who select this value are strict professionals who develop consumer goods. Unless our products are assessed highly for their quality, price, specifications, performance, etc., they will not be used.
  The electronic and communications equipment market has posted rapid growth in the past few years and continues to experience strong competition in the development of new products that must be released in ever-shorter periods of time. Along with this, the "price wars" currently rampant in Japan show no sign of letting up. In short, the demands for changes to specifications, lower prices and shorter deadlines from consumer goods makers directly serving consumers continue to increase in severity.
  In this market environment, in which the speed such changes is only increasing, companies will not be able to adapt to the environment by employing a form of sales that passively listens to and accepts all the demands of customers.
  Waiting until the design is finalized, receiving changes and repeatedly making samples until the final okay is given is not the approach that will enable a company to be victorious in the intensive competition over speed and cost. On the contrary, it only leads to disadvantages for the customer in the end.

  From early on, Kato Spring has taken the approach of proposing products to its customers. We first develop an understanding of what type of products our customers want to make and what consumer needs they are trying to meet. We then submit a detailed concept that explains what patented technologies Kato Spring can apply and what measures are possible. This is a design-in approach in which the characteristics of our company's products are actively proposed from the design stage and, in our words, "Win-Win" relationship is built.
  The key factor for success (KFS) in precision engineering and conducting business based on making proposals to customers is, first and foremost, development strength.
  The No.1-3 factories at Kashiwazaki and the Fukushima Factory each have multiple development teams of three to five people. They are organized in a horizontal manner with supervision of the factory manager. Each team takes the name of its leader. There is no compulsory control of the schedule. We first want them to develop a liking for their work. We want the joy of the "Win-Win" system to be created from the attitude of "Cheerful, Enjoyable, Lively, and Exciting. I did it!" I am convinced that excellent research and development results are essentially born from such a workplace atmosphere.
  The image of a single straight KFS line that connects the three parties of the customer, Kato Spring and its Katoites lies here. Therefore, there is no difference in this approach, regardless of if the client is in Japan or overseas. There is no concept of a key player or a head office.

  We often use the phrase "made in market." Precision springs themselves are small products. Although the per-unit price is not expensive, the product is not something that a customer will purchase just because it is less expensive. As indicated earlier, customers place orders based on specific specifications. They have detailed demands and want to discuss these with the manufacturer. Therefore, they want to work with a company that is located nearby, thus we understand that we should manufacture the product near the customer. This is the concept of "made in market."
  The high functional use of precision springs and their systems enjoys demand throughout the world. Of course, a large market is foreseen for local markets where major Japanese companies have set up operations. However, one will miss new business opportunities if a company depends entirely on demand from the major Japanese companies located overseas.
  The foundation of my business scenario is determining where we should be and who to work with if we are to be successful in the global market. We have no affixation to dealing with companies because they are Japanese entities. This approach doesn't change, whether in Japan or overseas. This finer tuned and speedier approach has generated good results, and we have enjoyed a 70% share in Japan for miniaturized, high-performance hinges for compact mobile telephones and a global share of as high as 50% for floppy-disk parts. Moreover, we recognize that our cumulative design-in efforts have built a solid foundation that serves to generate buoyant results in the sales of precision springs for electronic equipment, an area that will continue growing well in the future.
  I have recently gained a clear image that the aforementioned "straight KFS lines" are gathered together in the end to form a thick cable.