Tetsuya Iwasaki, President of Epson China: The success of the Chinese market remains crucial to Epson's global strategy

When the business operation is under pressure, how can managers maintain tolerance and flexibility in front of the market, so that the enterprise can adapt to complex and diverse competition? How do you motivate your employees, drive a sustainable corporate culture, achieve new growth, and meet the expectations of your employees, headquarters, and partners in China? This is a new challenge that Tetsuya Iwasaki, who has been working at Epson for nearly 30 years, is facing.

In April 1995, Tetsuya Iwasaki joined the Japanese headquarters of the Seiko Epson Group, and successively worked in the professional printing division of the Seiko Epson Group headquarters and the Seiko Epson Hirogaoka Factory, responsible for the profit management and other businesses of the division, and in April 2021, he served as the vice president of Epson (China) Co., Ltd., responsible for business management and support, and in April 2024, he was appointed as the president of Epson (China) Co., Ltd. and the president of Epson Hong Kong Co., Ltd.

For the new position, in an interview, Tetsuya Iwasaki also thought it was just an "accident". "I have a plan for my career, but becoming a CEO is not one of them." He said. Over the past 20 years, he has worked in the finance department of the headquarters and is responsible for profit management in the printer business department, which has made him deeply aware of the importance of business objectives and performance management to the development of enterprises. From this point of view, his financial background should not be underestimated, but can be an unexpected help.

Tetsuya Iwasaki is frank and calm about how to view the challenges facing Epson's business in China, "First of all, the uncertain market environment, and secondly, there are 'internal factors' from Epson itself that need to be reflected. He said, "The launch of Epson's products and the development of applications are a bit out of keeping up with the 'speed of China'." Under these two challenges, how to give full play to the existing advantages to promote innovation at the product level is a problem that Epson needs to solve to continue to win survival and development in China. ”

As his successor, Tetsuya Iwasaki hopes that he can create an environment where others (referring to Epson's business team in China) can succeed. "Do what you can do and do what you can do well." "My mission is to build on the good business foundation that has been built so that the company can grow even further," he said modestly. ”

Prior to that, his predecessor, Akihiro Fukaishi, Chairman and President of Epson (China) Co., Ltd., had established the height of Epson's business in China. In 2022, on the occasion of Epson's 80th anniversary, even under the restrictions and effects of the epidemic and supply chain disruptions, the overall revenue of Epson's business in China still achieved an increase of about 10%, and the inkjet printer and commercial printhead business for the home achieved a year-on-year growth of about 20%.

With the implementation of Epson's strategy of "technology + localization + environmental protection" in China, and the concept of "provincial, small and refined" rooted in product innovation, leading technology and scientific management as the core of Epson25's new long-term corporate vision, the purpose of "excellence, sustainable innovation" has become the advantage of Epson's development in China.

However, the wisdom of management is not only to inherit the existing success, but to seize opportunities and obtain new growth in a new development cycle. In the interview, Tetsuya Iwasaki said, "There are two things that can be done. First of all, it is necessary to give full play to the advantages of Epson's 'province, small and fine' to achieve differentiated operation with Chinese enterprises. Secondly, based on its own technological advantages, it will continue to innovate its business model and strengthen cooperation with Chinese enterprises. ”

Epson entered China in the 80s and went through three stages: trade, investment and factory construction, and comprehensive layout. After more than 40 years of development, Epson has established a complete manufacturing, sales and service network. In 1998, Epson (China) Co., Ltd. was established, marking that Epson's development in China has entered a stage of comprehensive layout. So far, the Chinese market has become the source of innovation with the most growth potential for Epson in the world. As China's innovation in the field of mobile Internet and digital transformation becomes an important part of China's supply chain nodes, it will undoubtedly bring new opportunities to Epson as a foreign capital.

Epson's most important printing core technology, PrecisionCore, for example, through its high-precision MEMS manufacturing process, thin film piezoelectric (TFP) and other technologies can greatly improve the printing speed, can significantly increase the types of inks that can be used and the range of printable materials, so that inkjet printing can achieve more possibilities, and promote the digital transformation of more industries and industrial fields such as printing and dyeing, textiles, advertising, signage, packaging, etc.

In 2019, Epson officially launched the printhead business in the Chinese market, and strengthened co-creation with local board and ink suppliers through cooperation with excellent Chinese enterprise partners to create solutions that are more in line with local user scenarios. The X3 direct injection digital printing machine of Caishen, a domestic installation customer, uses 20 Epson S3200-A3 print heads, which can be used for 24-hour continuous production, and the production speed can reach up to 600m2/h. By pushing the boundaries of the industry with our partners, Epson's technology has gained greater business value.

In terms of green technology cooperation, in order to keep up with the speed of China, Epson is planning to make breakthroughs in OEM and ODM cooperation. "Each company has its own expertise, and each company's capabilities also have its own limitations, so we should carry out better cooperation with Chinese companies and dedicate our expertise. I think this kind of cooperation is not limited to China, but in some cases, it is possible to work with Chinese partners to create new products and technologies and sell them on a global scale. ”

In the world's largest innovation "testing field", Tetsuya Iwasaki has made no secret of his "ambitions", whenever Epson's global headquarters business department organizes a delegation to China to "learn from experience", or relevant executives go on a business trip to China, he actively introduces Epson's progress in the Chinese market. He hopes to send senior Chinese staff (in the field of local innovation) to the headquarters in Japan to introduce China's innovative practices to various business units.

"Although it has not yet been realized, I have expressed this will. Epson's successful experience in the Chinese market will be replicated and promoted to other business units of Epson around the world, and the innovative applications accumulated in China will be promoted to the world through the headquarters, which will not only benefit users around the world, but also help Epson's development. He said.

On May 18, Seiko Epson celebrated its 82nd anniversary. Tetsuya Iwasaki believes that "the success of the Chinese market is critical to the success of Epson's global strategy, and innovation from China will bring new impetus to Epson's global success." ”

In his view, in the current uncertain market environment, Epson's performance growth in China is only one aspect, and the value of promoting China's innovation to the world is much higher than digital growth. Perhaps, this is the attitude that an enterprise based on technological innovation should show, be true, honest and maintain faith. It is also the embodiment of the spirit of "Try& Error" and "Do First" advocated by his predecessor Akihiro Fukaishi.

Interview:

——Dialogue with Tetsuya Iwasaki, President of Epson (China) Co., Ltd. and President of Epson Hong Kong Co., Ltd

Shen Jianyuan: The slowdown in the economic growth of the Chinese market has also brought more uncertainties, how do you view these challenges?

Tetsuya Iwasaki: The market environment facing Epson (China) did not suddenly deteriorate from this year, it is a problem of the general environment, and it is not something that a company can solve on its own, and the slowdown in China's economic growth is only part of the reason. On the other hand, we think Epson is a bit out of step with China. This is Epson's own internal cause. How to keep up with the "speed of China" is something we should challenge and solve. If Epson wants to survive and develop in China, I think there are two things that can be done.

First of all, it is necessary to give full play to the advantages of Epson's "province, small and fine" to achieve differentiated operation with Chinese enterprises. For example, in terms of the print head, the print quality or the image quality of the projector, and even the operating accuracy and reliability of the robot, these advantages should be brought into full play.

However, it is not enough for Epson to rely on its own technological advantages to achieve differentiated operations. Because the speed of technological improvement of Chinese enterprises is very fast, as a sales company, we should continue to innovate business models based on our own technical advantages, and strengthen cooperation with Chinese enterprises, through cooperation, give full play to their respective advantages, and achieve innovative solutions, such as we cooperate with Chinese enterprises in the field of printheads. This kind of cooperation from both ends of technology and business model should be done more, including more OEM, ODM and other methods, so as to achieve a win-win situation and achieve development.

Shen Jianyuan: Compared with the past 30 years, can the concept of "provincial, small and refined" play a new role in the development of China's business?

Tetsuya Iwasaki: In the past, Epson's growth has played a very important role in the development and growth of Epson, and I think its value will be further enhanced in this day and age. When the global climate is facing challenges, we believe that Epson's "provincial, small, and refined" technology is the "golden key" to improve environmental problems.

For example, Epson's printing core technology PrecisionCore, the inkjet process does not need to be heated, compared with other technology printers, the power consumption is also less, and at the same time, there are fewer parts, which is more conducive to saving resources and helping the environment. Compared to laser printing, inkjet printers using Epson's PrecisionCore technology can save up to 90% of electricity.

Epson's inkjet printing technology can also be widely used in various fields, and it is also a powerful tool to promote the printing industry from traditional printing to digital printing. Not only will it revolutionize the workflow of the entire printing and dyeing industry, but it will also enable smaller batches of on-demand printing, which will help solve the problem of mass production and mass waste faced by today's society. Therefore, "provincial, small, and refined" has been passed down as Epson's cherished genes to this day, and will continue to develop and evolve (with the development needs of all walks of life).

Shen Jianyuan: In China, will there be innovative business models and in-depth cooperation in "provincial, small, and refined" technologies?

Tetsuya Iwasaki: Taking the printhead business as an example, Epson has only been in the printhead business in China for about five years, but the printhead business has become one of the most important businesses of Epson (China). The success of this business is inseparable from the good cooperative relationship established by Epson and Chinese printing equipment manufacturers, including motherboard manufacturers and ink manufacturers. It is precisely because of the existence of such an ecological chain that our printhead business can continue to develop.

This is a multi-pronged thing: the printhead business has made a positive contribution to Epson's sales profit. In addition, through the cooperation between Epson and Chinese printing press companies, China's printing industry has been promoted to move from traditional printing to digital printing, and at the same time, it has brought benefits to the protection of the environment.

What's more, the printing equipment equipped with Epson printheads produced by Chinese companies has been exported to the world from being sold in the Chinese market at the beginning. The innovation of this business model is not only beneficial to China, but also to the world. Business model innovation such as printhead is not particularly easy to achieve through cooperation with Chinese companies to form a win-win situation. But we're always trying to expand it to more areas. The application of Chinese solutions is the world's leading, and I have an idea or an ambition: I hope that the innovative applications accumulated in China will be promoted to the world through the Japanese headquarters, and ultimately benefit users around the world, and at the same time contribute to the development of Epson.

Shen Jianyuan: Because of your financial background or expertise, will it make Epson more "calm" when setting growth targets for the Chinese market?

Tetsuya Iwasaki: I know that budgeting is very important, but we need to focus on it. Numbers are important, but even more important is the essence behind them. Because I know the situation very well, I will communicate this idea to my colleagues in a more subtle way in this position, you should value the numbers, but more importantly, the things behind the numbers.

For example, home projectors have great potential in the Chinese market, but the competition is also particularly fierce. If you only focus on Epson (China)'s own sales revenue, it is likely that a target that is too high will be half the effort. That's what I asked the team, Epson (China) must have a certain amount of sales revenue to achieve success in terms of performance, but we should not just focus on revenue, if our business in China can be promoted to other overseas Epson sales companies, it is also a kind of value transmission. These efforts can also be encouraged as KPI targets.

Shen Jianyuan: Have you made any mistakes in your more than 20-year career at Epson? What are the lessons to be learned?

Tetsuya Iwasaki: A particularly memorable M&A experience. At that time, we invested heavily in the acquisition of a company, hoping to achieve complementary strengths through the integration of resources. However, we were not able to grow it as we would like, which undoubtedly hit the company hard.

It is this painful lesson that prompts us to reflect deeply and gather the wisdom of the team to review. After digging deeper, we found that despite the disappointing end result of M&A, it made us realize that success in the business world is not always equated with the right decision, and sometimes even if the strategy is right, it can fail due to a variety of uncontrollable factors.

This experience has given us a valuable lesson: success is not achieved overnight, but is achieved gradually through trial and error and reflection. We must learn to accept failure, learn from failure, and face future challenges with a more mature and steady attitude.

Shen Jianyuan: How to evaluate the cost of trial and error to achieve innovation in the fast-growing Chinese market?

Tetsuya Iwasaki: My predecessor, Mr. Fukaishi, had a mantra "Try & Error" and "Do First", which he used to use a lot. As for Try, my thinking is that we should limit its scope, keep its influence under control, and try not to cause a big fire because of Try. Of course, there is a bottom line for trial and error, and it is not that you can do anything as you want. No matter how great people are, they make mistakes. But I believe that it is preferable to challenge even failure rather than do nothing, and I have always insisted on this view.

Shen Jianyuan: In the fierce market competition or uncertain environment and changes, how do you provide a stable core support team and employees?

Tetsuya Iwasaki: First of all, I am confident that I will be able to succeed at Epson China. For me, when making an important decision, I must first look at the big picture, and at the same time, I must not shy away from it, but make a decision on the spot. No one at Epson has more experience than I have learned and mastered the unique things I have learned and mastered in my career, including the success stories and failures I have seen in financial management and participating in business decisions such as mergers and acquisitions at the headquarters for a long time. I want to continue to take on challenges while having a good listening ear and creating a transparent and open environment for my employees to speak freely. I believe that this approach will eventually lead to greater growth for myself.

Secondly, we have very good employees and an excellent management team. Previously, under the leadership of Akihiro Fukaishi (former president of Epson China) and other Epson (China) presidents, Epson (China) has comprehensively promoted localization compared to other Japanese companies, providing a platform for local outstanding employees to play their value, and has also achieved good results. I firmly believe that they will bring greater benefits to Epson in the future.