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My Japanology / Opportunities to grow in Japan exist through innovation

Kota Kawasaki/The Yomiuri Shimbun

Stanislav Vecera talks with The Japan News at the headquarters of P&G Japan K.K. in Kobe.

The Yomiuri ShimbunWhen Stanislav Vecera came to Japan for the first time in August 2015 to become president of Procter & Gamble Japan K.K. (see below), he was happy and smiling due to his high expectations. Vecera prioritizes diversity and talking with as many employees as possible, which appears to have led to positive chemistry with his staff.

Vecera recently spoke to The Japan News about the challenges he faces and his hopes for the company.

Q: What are the particular characteristics of the Japanese market?

Vecera: I would look at that from a few areas. One is from the consumer. The consumers here are probably the most discerning, discriminating consumers in the world. They are looking at the best products, the best innovation, and they are willing to try, but their standards are much higher than anywhere else. What I have learned here very quickly is that the speed of innovation and the quality of innovation is critically important to succeed in the Japanese market.

The other is the frequency of shopping. I think that links to how people are living and working — they commute more than anywhere in the world to work and back. That connects with their shopping behaviors. People visit stores much more frequently in Japan than in some other developed markets. So, there is the need for innovation, but also to be available in multiple places. It’s much more fragmented than a market like the U.S. or Western Europe where you have these big-box stores where people go shopping weekly and do much more bulk shopping.

These two [factors] combined create a very different market dynamic in Japan.

Q: Japan is said to be a challenging, difficult market from a demographic point of view.

A: That’s the perception from outside, and I think it’s also the perception of many leaders of companies in Japan. I believe that there are opportunities to grow. It’s not easy, but if you learn from consumers, understand their needs and their response to innovation, if you understand their shopping behavior, the frequency of shopping, and combine it together, we can create innovation that brings growth in Japan.

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  • Kota Kawasaki/The Yomiuri Shimbun

    Stanislav Vecera emphasizes the importance of learning from failure, saying, “You cannot fail enough to be successful.”

Q: How have you persuaded your employees that there is potential for growth?

A: It started as a smaller group. These are my people in my leadership team with whom I started to paint the future, and I got a few of them on board. I got my leadership team aligned with my vision. What we have launched is a series of engagements with the organization. I really believe in a very close relationship between the management and the people in the organization. One of the interventions that we have done on the organization side is to create a strategy of frequent talks that we have even named “Let’s Talk.”

They’re held once a month either here [Kobe] or in Tokyo. The aim is for me to talk for 20 to 30 minutes about where we are business-wise, what is our vision, where we stand with our vision, and give a very clear picture — success or no success — but very open and transparent communication.

Then I ask the people to ask me questions directly. One of the principles is that I lead this, I never delegate this. Good times, tough times, average times, I’m in front of people telling them this is where we are, and this is the vision we created. Sometimes people ask me tough questions because not every month is a success. Business is up and down.

Japan’s high-level values

Q: How do you find consumer needs that never existed before?

A: We have long-term experience as a company in this, and basically there is a series of research that we are doing. There is quantitative research, but I believe a lot more in getting in homes with consumers and looking at the way they are washing, talk to them, what works, what doesn’t work. Are they getting the smell, the stain of the material off their clothes? Are they happy, do they need to wash, rewash? How they are washing dishes, how they are washing their hair. So, via dialogue, a lot of insights are coming out.

Then selecting the insights, confirming them with quantitative studies, creating prototypes, going back to consumers, sharing the prototypes, sharing the concept, another study. Innovation takes time, but it is about the consumer being the boss. It’s talking to her or him and understanding what are the needs.

And then we hit it, like with this one [holds up Febreze for bathroom]. This product is beyond our expectations. So, this took us five years. It looks very easy, but there’s effort.

Q: In terms of human resources, you put a lot of emphasis on diversity.

A: Yes. It comes back to innovation, because we believe in having the representation of consumers to work for us, that’s how the rest starts. It’s not just numbers, it is actually business strategy. Because you want to have people that are representing the demographics of the society and the consumers working for you. Then they can translate insights into innovation. And sometimes it’s very surprising, you sit in the meetings and then the diversity and what we call inclusion comes alive.

Q: Can you give me an example of diversity being the driving force behind a successful product?

A: Very famous, in the company for us, is Febreze. It’s very critical for Japan, and it is very different also with other countries, and we sell Febreze in many aspects. It’s for clothes, it is also for homes. If you look at it the traditional way, how people look at these products maybe in the U.S., the homes are big, in Germany as well, a lot of space, there is no need to have one product in the whole house.

Also, if you put an American in Japan, he doesn’t know that he needs to take his shoes off [when] he enters the house, but then the shoes are the first thing when you come into a Japanese house. So, we took this insight — now I’m talking about more from demographics in Japan, diversity point of view in a multinational company. So, we created a product that works for the entrance of the small apartments in Japan where you have shoes, and we have a dedicated shoe box product that you put there that takes the odor away — which is the most embarrassing thing if you have, if you enter the house, which happens only in Japan.

Now, if you don’t have the right insights in the R&D department when you are creating the product, you will not be successful here. So, that’s one thing that from the diversity point of view is important.

Q: When did you first come to Japan and what was your first impression?

A: I had not been in Japan before — August 2015 was the first time. Basically it was the week of my announcement that I was coming to Japan. I really remember that when I landed at Kansai Airport and put my foot on Japan soil, I was very happy. I think I was even smiling. First, because I was in Japan, and second because I will be leading such a large, important, successful business. I didn’t know yet what I was going to do, but it was a very joyful experience.

From there, I think the first impression was very welcoming. The people are so nice and so welcoming to you that it’s almost overwhelming. The first time you get lost at a train station, people walk with you half a mile to show you where you are. Everybody is really trying to help you to get going.

Q: What are the strengths of this country in terms of social or cultural issues?

A: First of all, the values are at a very high level. Personal beliefs and how people live their life, the personal standards are so high that it’s very admirable. That leads to a very safe country and very trustworthy country that is amazing to live in.

The craftsmanship and the attention to detail is unprecedented, and that’s another big strength. When I look at our manufacturing, we have one of our best plants in the world here, because of the attention to detail and to not making a mistake that the consumer could suffer from is really at a high standard.

Q: How about its weaknesses?

A: I think sometimes the attention to detail and being over-perfect could slow things down. I would balance it with more agility and moving fast, rather than trying to be super-perfect. I think one of the global tech companies, their motto is, better done than perfect. The speed sometimes is ahead of being 100 percent. I know it doesn’t work in Japan — it needs to be perfect — but the speed needs to come together with this. So, sometimes we need to move a little bit faster. The craftsmanship and being perfect, together with the speed, will be needed to succeed in the future.

Training for young managers

Q: What is the key to breaking such inertia in Japanese companies?

A: I can tell you what we are trying to do to speed up the thinking process and come up with solutions inside the company when we look at some of the challenges. We created a project to stimulate the growth of the young managers while resolving some business issues. It’s kind of a boot camp where we invite several people from different locations and organizations within Japan and we give them a real business challenge.

We are talking [about] young managers with two to five years in the company. We give them a real challenge and ask them in one week to come up with a solution, and then they present the solution to me and my colleagues, and we take the one or two best ones from every round and we implement [them]. We try to train and develop the capability of young people to go fast.

Within three months they [can] see it evolve from an idea to implementation, and it’s done. That creates an example that things can move fast, because even at P&G, it’s a big company, so from an idea that somebody has at a store in Sendai to my office it needs to pass four or five levels, so that’s a shortcut that we try to showcase to show it’s possible.

Q: Are there any cultural or social things in this country that positively affect your life?

A: I believe in balance in life, and when people talk about work-life balance from a time point of view, it’s impossible. It’s more from an energy point of view — having enough energy to do things outside of work that you want to do. Japan is amazing from that aspect because there is so much to explore.

I’ve tried to travel quite a bit. So, I have a lot of hobbies outside of work. I have motorbikes, cars, bicycle, I run marathons, I try to do different things.

I’ve been very fortunate that the company sent me here because I would never be able to explore the country the way I can when I live here. And of course my family, we have visitors all the time. It’s a second job for my wife because she has to accommodate everybody coming in. My wife loves the craftsmanship, the pottery and all of this as well. We have so many things at home already because she is traveling around. I love the samurai culture as well, and my boys are learning all of this philosophy.

This interview was conducted by Japan News Deputy Editor Takeshi Nagata.

■Profile

Vecera took up his current post in September 2015, after serving as a vice president managing South Africa and South, East and West African markets. Since he joined Procter & Gamble in 1991, he has held many important positions in various countries, including Singapore, Hungary, the Czech Republic and the United States.

Vecera was born in the Czech Republic and graduated from Mendel University.

■Procter & Gamble Japan K.K.

The U.S.-based global company Procter & Gamble started operations in Japan in 1973 through Procter & Gamble Sunhome Co., a joint company with Nippon Sunhome Co. and Itochu Corp. P&G Japan has introduced innovative products such as Pampers disposable baby diapers in 1977, Ariel powder laundry detergent in 1988, and Febreze fabric freshener in 1998. Its headquarters and its innovation center are located in Kobe.

The parent company was founded in 1837, and currently operates in about 70 countries. Its net sales in fiscal 2017 were $65.1 billion (¥7.4 trillion). It has about 95,000 employees worldwide.

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