At the core of the associates system, we are developing the concept of suitability in scale.
  In the previous section, I described decisions concerning corporate risk as choosing the most important matter. So what is the most important matter for Kato Spring?
  If I was asked this question, I would respond that it is the creation of a corporate constitution that is like a venture corporation. This is because I believe there is nothing greater in importance than this today as we try to respond to the new theme of "adapting to change and creating change."
  I often hear managers complaining when their company becomes so large that they end up with "large corporation sickness." In other words, they can't keep up with the speed of change and accept customer needs in a detailed manner.
  Although the problem can be easily passed off as a sickness of large corporations, it is not simply a problem of hardware. It is because there is a suitability scale that differs depending on the business. The problem is not of size but rather the attitude of the company members, including their superiors.
  The deceased Kazuma Tateishi, former chairman of Tateishi Electric Manufacturing Corporation (currently Omron Corporation), sounded a warning bell about something early in 1980s. His warning, if I recall correctly, was that he noticed that the company's customers were swept away by its rivals before it was realized. In addition, an increased number of meetings and lengthy meetings had become natural. The further away from the work site they became, the more difficult it was for them to notice they had caught large corporation sickness.
  This doesn't simply mean that it is better for an organization to be small. What is important is to have a flexible organization with a suitable scale that matches the business content.
  Kato Spring is a corporation with 700-plus Katoites. It makes precision springs centering on production following the receipt of orders and works metals and plastics. If each of its sectors were different companies, I believe that the suitable scale would respectively be between 50-100 Katoites. If the number is further divided, the scale and number of people in each office is not that large. However, the perception of the company as a single unit began showing the symptoms of large corporation sickness.
  Simply put, this is because of the increase in the number of information channels before we were prepared for it, causing an overlap in decision-making routes and resulting in a surprising distance from the work site. High walls between divisions and sections were built before we knew it, making individual Katoites invisible.
  The principle of conceding anything to avoid trouble and "you can't fight city hall" are chronic symptoms of large corporation sickness; that is, hiding oneself at all cost so that no one can see you. In my opinion, this is nothing more than the spoiled action of an individual who is trying to blame it on a higher authority.
  This type of problem is not unique to Kato Spring, but it is apparent in the workplace of most companies whether major or minor. It is a typical example of not a "Win-Win" relationship but the opposite, horrible cycle of "Lose-Lose." Such a situation naturally leads to increased management costs. Quality costs and costs to meet delivery deadlines swell as individuals become accustomed to the looseness of transactions between companies. Not only do the time-related costs of information increase, but also the costs arising from skewed information. The losses of these real figures cannot be covered through cost reductions at the work site, and before you know it, corporate endurance has rotted away.
  But does a company that tries to blame everything on way large corporation sickness really have a physical presence?
  The term "associates system" has a strong nuance for joint owners. For example, in the case of a subsidiary, the subsidiary should be run at an optimum under personal decision-making rather than control of the parent company. Subsidiaries are not made to act as receptacles for people from the parent company. Further, they should not be another set of books used for transferring deficits from the parent company.
  The major change in accounting standards that was implemented recently has made it difficult to hide figures and transfer deficits. This also indicates that a shift in ideas is naturally being sought in regard to people. We have not entered an era in which the "deficits of people" can be pushed onto subsidiaries.
  Subsidiaries that cannot survive bearing deficits of the parent company end up depending on the parent company. There is no way such subsidiaries can last. Moreover, a parent company that passes "deficits onto a subsidiary" cannot implement a healthy restructuring plan.
  Only when an organization is formed with a scale that is suitable for its business content will each Katoite be able to independently demonstrate his/her abilities and optimize team strength. For example, in a small organization, there is basically no need for a human resources department. This critical role should be handled by the organization leader.
  Personnel decisions should be dealt with by a leader that understands the characteristics, abilities and living environments of each company member sufficiently under his own clear responsibility and authority. This is not something that a human resources department separated from the work site can conduct. We believe that such ideas will be the key to a new organization.
  Our desire is to make the associates system the breakthrough point for connecting the "Win-Win" relationship between the parent company and group companies. We want to disseminate this throughout the internal organization. Kato Spring is now progressing with these steps.