The Japan News Danny Risberg, chairman of Philips Electronics Japan, Ltd. (see below), has lived in Japan for about 30 years, becoming deeply involved in the health care business. The 54-year-old American, whose mother is Japanese, has seen how much the country has changed in some respects and remained the same in others. Risberg, who is also chairman of the European Business Council (EBC) in Japan, recently spoke to The Japan News about his experience and views regarding business and Japanese society.
Q: When did you come to Japan for the first time?
Risberg: I was a little boy. I think I was probably pre-school or before even maybe kindergarten, so very young. I came here with my mother once to visit relatives in Japan. So actually I don’t remember so much. I remember my uncle and my cousins, they lived next to a temple actually in Sugamo here in Tokyo ... all around that area in Sugamo, there’s big cemeteries. Where I grew up in America, no one wants to live near the cemetery, but in Japan everybody lived right in the middle ... I remember because it was very different.
Q: How about your second visit?
A: I think it was about 30 years ago, because I was coming to start business with some partners ... I’d actually made a plan and I wanted to work in the medical industry, for various reasons. And I came here and I was meeting with some physicians I had met and I’d known. And I met with a man that I’d met that was in the medical importing business … and I knew some friends who were engineers … So I was very interested in getting into the medical business versus my original career.
Q: Did you feel any difficulty to stay and work in the country?
A: I felt personally very comfortable. But honestly it was very, very difficult because now, you can go many places, people speak English, you can go to the kuyakusho [ward office] and they would have somebody now that would help you, but 30 years ago, there was nothing. And so it was very, very hard.
Q: How did your business go?
A: It was very interesting because I ended up working with a small company but it was very focused on respiratory care. At that time we decided what would be the next future for us to make. We looked at large Japanese companies, we looked at the large international medical companies, and [in] diagnosis they had many Japanese, but all the real medical therapy are life-support equipment and at that time it was ventilators. And no companies were interested in that because it was very difficult.
So we said, let’s do ventilators. And as we did that, we saw the big future step was home care ventilators, because at that time there was nothing.
Risberg: Nation always changing imperceptibly
There was no insurance ... no one was willing to do it. So we worked for many, many years to build a home care business. It was quite interesting, because we had to find the products, but you also had to find the patients — because they’re all in the hospital. So to try to convince them that they could go home and it was better.
Q: You have a long relationship with Philips.
A: Yeah ... I feel very privileged, because now Philips is one of the largest home care companies in Japan. I’m very happy that I stayed, and stayed — the company has changed a few times due to acquisitions, but the actual business has stayed very much the same.
Right now [Japan’s] the oldest country in the world. So maybe a lot of what everyone does in Japan will slowly be seen in other areas. So hopefully we can have some good experience in Japan. But what’s happened is, once you’re old, unfortunately you do get ill. And what we find is, 30 years ago, the Japanese system was set up for acute care. So maybe somebody had a heart attack. They fall down, they rush to the hospital, the care is OK, you save them, and then they go home.
But what’s happening is medical — the doctors are becoming so good, the equipment and medicine becoming very good, so you save a lot of people. But unfortunately you don’t cure them. They’re still sick. So it’s moved from acute care to chronic care. At some point you need to go to the hospital again and you get some type of diagnosis. Then if they find that you need something next, then you get treatment. Then after you’re treated, if they do a good job, which usually they do, then do you stay in the hospital? No, they send you back home.
So now the patient’s back at home, they’re living, hopefully, a good life, but they need to breathe oxygen for so many hours, or maybe 24 hours a day. You can stay in the hospital and do that, but it’s not a good life, so it’s much better to be able to go home. You can live with your family or take care of yourself. So … instead of any technical thing, we try to look at it as the patient, they continue.
And if we all do a good job, they go back to start again at home. So they just continue on the cycle and it’s really a continuum of care. So if you have all the technology, now, in the digital world, you have to have a platform and connect all of the information. So that’s why in the transition Philips, [while] not 100% innovation or inventing products, [is] connecting the products, so we have solutions, and so we’ve become now what we call a health tech company.
That’s probably, even in the last 15 years of Philips, you see big change away from individual technologies and innovation to really a continuum.
Learn from customers
Q: It has been said that Japanese customers are so precise.
A: Yeah. I think they’re extremely detailed. Extremely detailed … You know, people say the quality, the quality. Well in medical, quality is not a nice-to-have; it’s a must-have. But Japanese are very focused on the detail. So we can learn a lot from the customer.
Obviously quality’s a part of it, but I would describe the Japanese customer as extremely detailed and there are other things that an Italian or an American or a Brazilian [would say]: “Oh, that’s OK.” But the Japanese customer [says]: “That’s OK, but ...” They’re one more level. So from that perspective, they’re a great customer because you can learn a lot, because they’re in the detail. I mean, from the instructions to the product, everything. They’re precise. Especially the users. They really want to make sure everything is perfect. So it’s a battle.
Q: After working as Chief Executive Officer of the company for around seven years, you became the chairman this March. What kind of things do you focus on now?
A: The beginning was to help the transition to our CEO ... So one, use some of the experience I have. And the main goal that I work on almost every day is, I look at the Philips strategy — what needs to happen for the next five years? And as you had asked me earlier, when I first came, it’s very similar. What needs to happen? Well, there’s a lot of bureaucracy. We need to change this rule, or we need to understand this rule better.
And now you have a lot of change in the Japanese health system. So as they’re making changes I need to participate so I can hopefully influence the change to be better, and then also make sure Philips understands that.
EPA offers more opportunity
Q: As chairman of the EBC, what do you think of the economic partnership agreement between Japan and the European Union?
A: When that happens [when it becomes official], I think the opportunities are great. Japanese companies will have much better access to the European market — one of the largest markets in the world. Europe will have more access to the Japanese market — the third-largest market in the world. So if you take Japan and Europe and add them together, they’re significant, they’re a third of the world trade.
So that would meet the economic strategies of both Europe and Japan. The thing for Philips, for all the European companies, hopefully we remove some of the bureaucracy and then it makes it a fair playing field. It doesn’t mean every company in Europe is going to come here and be a winner. But they’re at least going to have the opportunity to try ... I think the minute it’s signed, within the first year, I know for European goods, roughly €1 billion will be reduced in taxes, so that should offer more choice to the Japanese consumer ... I think the EPA is going to offer more opportunity.
Europe and Japan, by doing this, are showing the world that open trade is better. We believe that open trade is better than protectionism. So in the world we live in, I think that was a pretty strong statement from the governments to say, “Hey, let’s work together. We’re two very like nations.”
The EU and Japan, they follow the rule of law, they’re both well-developed democratic member states. They’re very conscious of the environment and sustainability, so they want it to be fair. They don’t want child labor, we want, you want the world to be a better place, right?
So beyond the economics, there’s a big part of the agreement that is more ethical, that offers Japan and Europe an opportunity to help lead the world to become a better place.
Q: How would you evaluate Japan? What is your definition of the country?
A: It’s the one country that’s always changing but you can’t tell. It’s not like open, big change. Many people say, oh Japan’s so mysterious, and my point is, no, no, if you live here and talk to the Japanese people and become friends, it’s not mysterious at all. I’ve traveled everywhere in the world, in Vietnam it’s changing constantly but you can see it. The culture changes, the people change, the buildings change, and everything is changing. In Japan, it’s changing all the time but it doesn’t seem like things are changing. So it’s the world of change without appearing to change ... So I guess living is believing. I think Japan is on the road to hopefully greater things.
This interview was conducted by Japan News Assistant Editor Takeshi Nagata.
■ Philips Electronics Japan Ltd.
Its parent company Royal Philips is a multinational Dutch corporation, increasingly focusing on the health care business recently. Philips began doing business in Japan in the early 1950s. The multinational corporation currently regards Japan as one of the most important markets among the more than 100 countries where it operates, because its efforts to deal with problems in this country, which has a rapid aging population, are garnering attention from all over the world. The Tokyo-based company and one of the group companies provide products and services in the field of health care including home care ventilators and personal care products.
Born in Colorado in the United States and raised in Southern California. His career with Philips started at U.S.-based company Respironics (currently Philips Respironics) in 1999 in the dual role of senior vice president for Asia-Pacific sales and general manager for China. After working as CEO of Philips Electronics Japan for seven years, Risberg became chairman this March. He has also served as chairman of the European Business Council in Japan since 2014. One of his keen interests is fly fishing. Risberg is fluent in both English and Japanese.