Tadahiro Yoshida, the son of the founder of YKK Corp, carries on his father’s “Cycle of Goodness” corporate philosophy: no one prospers unless he renders benefits to others

IF YOU’RE WEARING a garment with a respectable label, take a moment to check its zipper. (This may be tricky for female readers.) Ten-to- one you’ll see the letters YKK on the pull tab. Yankee Whitcomb L Judson came up with the original idea for a zipper, and a Swede named Gideon Sundback patented it in 1917. Leave it to the Japanese to take a foreign technology and run away with the industry: YKK is the world’s largest zipper maker. contributing Editor Bernard Krisher knew founder Tadao Yoshida when YKK was struggling to gain acceptance in the world market. In Tokyo, he sat down with Yoshida’s son Tadahiro, the current president and cEO, to discuss the company’s growth – 2007 sales reached ¥658 billion or US$ 6.15 billion – and the YKK code of ethics called “The cycle of Goodness,” which emphasizes corporate responsibility to the community and its workers. Oh – and if you happen to wearing a pair of knock-off Levis or Dockers from Mongkok, your zipper probably bears the letters YKK too. Don’t believe them: YKK is the brand of choice for zipper counterfeiters.

I have known you, your company and your father [Tadao Yoshida] for a long time. I first met him in 1964 when he invited foreign correspondents to Toyama to tour your main factory. He explained that he founded YKK in 1934 and was now producing enough zippers annually to circle the globe. We spent a wonderful weekend with him going abroad. Tell me something about your father.
When my father was 25 years old, in 1934, he began this business. Before that, he was working for a small trading company where he handled many products. Among them were zippers, but he was not handling zippers at the time. Unfortunately, the trading company went bankrupt and because the owner had nothing else to offer my father, he gave the zipper business to him. He said, “This is maybe the only product of value I have to give you.”

So my father accepted it and started his business with the leftover zippers. But he experienced a very difficult time because the zippers were not very good quality. Subsequently, he diversified to other areas, such as architectural products, such as the window sash. The company also decided to expand by going abroad.

Today, we remain the world’s largest zipper-maker, operating in 70 countries. We moved from my father’s original strategy of expanding internally to foreign acquisitions and invested in other ventures, such as real estate in Burma and producing coffee in Brazil.

The business of producing architectural products is a progression of the zipper business as it is a form of bonding or sealing space, and it has induced us to focus on bonding, like safely holding apparel together, then moving to ensure safety in all products we develop.We are even making the fasteners for airbags in vehicles. I think we are truly following myfather’s philosophy in working to bond people through our products.

Can you tell me something about your overseas expansion?
We have established subsidiaries all over the world – everywhere from Taiwan to Honduras. We provide our technology to all these subsidiaries and offer them marketing advice, but we do not directly manage their operations or collect all the profits. Their income is reinvested into their own operations and it is the employees and customers who share the benefits. This follows my father’s philosophy, which he always practiced at YKK and we are deeply committed to it.

I recall at the height of the oil crisis in 1973, I visited your father on a cold January day in a freezing room at the Toyama factory, warmed by a single oil stove. I asked him how YKK was preparing to meet the challenge of a potential cutoff of oil supplies from countries such as Saudi Arabia, which were threatening to halt exports to Japan. Your father said he had already set up a system at his factories to sweep up scrap and sell it, and told his employees not to come to work by car to save money and oil. But if a real crunch came that threatened the existence of YKK, he was prepared to shut down and collect 100 of his best and most qualified people and designate 25 people to divide all the assets of YKK and distribute it
to them to reconstruct the company.
Yes, this was in the true tradition of my father’s philosophy to always share with our employees.

What is the greatest crisis that you have encountered in running YKK, and how did you handle it?
We were fined quite a large amount of money over a compliance issue.

What was the issue?
It was a cartel. Actually, we didn’t do anything wrong. But we acquired a button company in Germany, a very old button company with a history of over 100 years. In Germany, there exists a kind of guild system and people in that industry gathered to discuss our acquisition, pricing and other matters that complicated our operation there within the culture that existed. These are issues I’ve had to face periodically and I just tried to manage to get through them.

At another time, I ran into difficulties adjusting to the new European currency, the euro. Again, there were industry gatherings in Europe and our zipper people were invited to attend a meeting to discuss how to adjust to the changes brought on by the new currency. In the meeting, there was a little discussion about pricing. Of course, we didn’t do anything like increase prices, but we found out that just attending the meeting was a violation of the law.

Ultimately, we sorted out all the problems with patience. My philosophy is to always face challenges with confidence that if you accept to work through the natural process of letting problems resolve themselves in stages, everything will ultimately work out as they did in these crises.

Can you think of any other crises that you faced and how you resolved them?
I can’t recall any crises, but we’ve had many challenges such as moving away from our main product, zippers, into other areas such as architectural products, which already has a 50-year-old history, and expanding overseas. Our first overseas move was to New Zealand and after that we started our operation in Atlanta, in the United States, and then Hong Kong and Europe. I think we’ve come a long way.

This year is the 100th anniversary of my father’s birth and next January will be the 75th anniversary of YKK’s founding. While we have undergone some transformation in our product lines, such as zippers to architectural products, and expansion to many regions of the world, the one consistent principle that has and continues to guide our company is, has and will always be my father’s deep philosophy of sharing our gains with our employees and customers. Our customers have enjoyed receiving utmost attention to the quality of our products, which are maintained under strict control and strict attention to providing satisfaction.

From early on, my father showed great concern for corporate social responsibility, a phrase that is now popular among companies, by establishing an educational foundation that funded scholarships to Japanese students to attend high school. Today, this fund has expanded to provide generous grants to students in Japan to continue their education in graduate school and it also supports foreign students attending Japanese institutions of higher learning engaged in research or courses focused on Japan-related subject areas.

My father always wanted to have a farm so I am proud that I have helped to realize this dream for him by establishing a coffee plantation in Brazil, where I think we are producing the most delicious coffee I have ever tasted. It is called Bonfino.

I recall that your father always wanted you to succeed him and appeared to be very strict in preparing you for the task. He would not let you rest, even while commuting between Tokyo and Toyama. He forced you to travel by train rather than by plane and even would not let you stay in a hotel overnight when you were in Toyama. Then he sent you to Northwestern University where you graduated with honors from their MBA program. Was that valuable training?
There is no way you could run an Asian company based on what you learn at a US MBA course. My father also sent me to Keio University in Tokyo but did not stress my learning business management there; instead he pushed me to become the leader of a labor union. His mind was always in considering the welfare of our workers rather than profiting from their labor.