Through the medium-term management plan, we enhanced both our “physical fitness” (earnings capacity) and “muscular strength” (organizational capabilities), to drive growth.
Stronger management foundations for earnings capacity and continued growth
Meeting the targets in the V-2 Plan was not accomplished only during this three-year period. It is the culmination of various reforms that began with the V-1 Plan in 2012. Over those six years, Lion made a concerted effort as a corporate group to enhance both its physical fitness and muscular strength. “Physical fitness” refers to our earnings capacity as a company. Lion changed its direction toward improving profitability, and focused on high-value-added products that reflect changing markets, while at the same time concentrating resources on the development of key brands. This process established a structure, both in Japan and overseas, that allows for the continual development of brands and products. We are now selling key brands and high-value-added products at stable price points. This has led to a virtuous cycle of more-efficient sales promotion expenditures, which, in turn, allows us to secure advertising funds to enhance brand and product strength over the longer term.
We also made efforts to strengthen management foundations for continued growth. In addition to strengthening our R&D function—the basis of a manufacturer—and expanding production capacity for major products, we consolidated the corporate group’s chemical businesses as Lion Specialty Chemicals Co., Ltd., putting in place a structure to support a challenge to be the leading company in the field. In the growing overseas business, Lion is strengthening its management structure to enhance market competitiveness, and has laid the groundwork for the functional foods business and new business creation.
Improved organizational capabilities brought by sales structure reforms
Improving “muscular strength” (enhancing our organizational capabilities) also supported the success of the V-2 Plan. The majority of reforms to sales and marketing were made during this period. Specifically, instead of just chasing the sales right in front of us, we worked with retailers to understand the issues they face and consider how to generate new demand through our brand development, acquiring the capability to propose innovative solutions. The varied and specific successes produced with this approach won Lion the trust of many retailers, and, in turn, raised employee motivation. We were able to transition to a sales and marketing structure that can both develop brands, and build partnerships with retailers. Further, the sales structure reform generates new types of collaboration between the marketing and research and development divisions, evolving into a structure able to pursue “customer-oriented manufacturing” from the product prototype stage.
Since assuming the position of president, each year I have visited around 15 business locations to exchange opinions with young employees and managers. These sessions have generated ideas on improving operational processes and a range of other proposals, and given me the chance to directly feel the positive change in employees and organizations. Summing up these six years, I would say that the efforts of all employees to strengthen our “physical fitness” and “muscular strength” are what have allowed us to achieve the V-2 Plan.
The V-2 Plan Quantitative Targets
|(Unit: ¥ bn)
|Profit attributable to
owners of parent
||10% or above
||90% or less