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Seizing the global niche top with unique approaches in uncertain times / Financial Times

In Japan, a unique company is enabling tomorrow’s technologies from 5G to advanced medicine with a strategy to seize the top position in critical niches of the global industrial ecosystem

Hundreds of times a day, when you swipe your smartphone, turn on your TV, drive your car or use household appliances, you probably come into contact with a Japanese company that operates hidden from view.

Hideo Takasaki President, CEO & COO of Nitto Denko Corporation

The company is called Nitto, and for more than a century it has been creating innovative niche products that enable convenience, safety, and wellbeing in everyday life.

Nitto products are tucked away in the essential products of daily life, in fields including electronics, automobiles, infrastructure, and healthcare. And today it’s committed to leveraging deep experience to find solutions for sustainable living in our challenging times.

“Indirectly we’re providing convenience and peace-of-mind to billions of people around the world,” says Nitto CEO Hideo Takasaki. “We’re a B2B company.

But everyone in the world touches Nitto hundreds of times a day. In your smartphone alone, there are more than ten Nitto products hidden inside.”

Niche strategies for global success

How has Nitto become an indispensable partner to the world’s leading manufacturers? One key is Nitto’s unique strategy called Sanshin Activity. The term combines the Japanese words “san” (three) and “shin” (new) to express generation of new products, new applications for products – and thereby new demand.

Sanshin Activity embraces a belief that an innovation never “ends” but can be constantly renewed for the world’s ever-evolving needs, with new technologies and creative thinking.

One Sanshin success story is a tape developed to peel off easily and leave no residue when removed. Developing it further, Nitto found new uses for it as protective film in a variety of fields, from building sites to new kitchen sinks and autos for export.

The adhesive’s next use case was even more surprising: in the process of semiconductor manufacturing. The tape is today applied to the back of wafers to prevent movement during delicate slicing. The film can then be easily removed leaving no contaminating residue, enabling the semiconductor to be assembled in a clean environment.

“Who would imagine a single product could evolve and continuously add new value in fields ranging from homes to autos to semiconductors?” says Takasaki. “That’s the power of Sanshin Activity.”

Sanshin underpins Nitto’s other key strategy called Global Niche Top. It’s a differentiation approach in which resources are invested in niche areas where the company can demonstrate superiority in growing and changing markets. The goal is to become No. 1 in global market share.

The Global Niche Top is inspired by a spirit of collaboration with leaders in consumer-facing products. It involves listening to the customer’s “wish-list” of dream materials or components that can enable the next breakthrough product.

“Customers come to us and say ‘I wish something like this existed’,” says Takasaki. “Then we go away and create something that surpasses their expectations. We make them say, this is exactly what we wanted!”

Sustainability approaches to build enduring value and long-term success

Nitto is proactively developing solutions for sustainability and social inclusion. One example of an eco-friendly product is Nitto’s low VOC double-sided tape that achieves outstanding adhesion without using harmful organic solvents, such as toluene and ethyl acetate.

The adhesive’s low volatile organic compound (VOC) emissions minimize exposure to harmful fumes. Nitto also endeavors to incorporate green practices in its manufacturing process.

“It’s about contributing to society. That’s the top priority,” says Takasaki. “And solving social issues goes hand-in-hand with enhancing corporate value. We need to turn these two wheels together.”

Forging a role as an indispensable global player in challenging times

There’s no doubt we live in times of historic challenge and flux. Yet Nitto has prospered for over a century through a belief in taking change as an opportunity.

Nitto sees a wave of new human needs on the horizon amid pandemic and climate challenges. Nitto is today redoubling efforts to find answers to society’s problems with unique niche solutions that adapt to a dizzying pace of change.

In particular, Nitto is able to nimbly respond to dynamic environments with a strategy that distinguishes between 1) demand that won’t return 2) demand that will return 3) demand that will grow. The idea is to drop dead-end markets and focus resources on growth areas.

The approach is bearing fruit with Nitto’s development of a 5G-applicable product called Plastic Optical Fiber (POF). Seeing a key growth segment in communication interfaces, Nitto is developing a product that will play a key supporting role in ultra-high speed digital networks.

POF’s advantage is flexibility and resistance to breakage and noise interference. It will contribute to everything from seamless communications for telework, to remote surgery that can save lives amid mobility restrictions.

“We see a clear path to competitive edge in the global arena by pursuing the Global Niche Top,” says Takasaki. “It means that whatever change we’re confronted with, we always find ways to thrive with niche innovations that enable the technologies that shape our world.”



※This article is published by Financial Times. Click here to see the article.

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