IPG Visits Canon's Tokyo Headquarters

In-plant Graphics Editor Bob Neubauer visited Canon Inc.'s Tokyo headquarters facility last week along with a small group of U.S. editors and analysts. There, they met with Canon Chairman and CEO Fujio Mitarai and other Canon executives to learn more about Canon's strategy. The group also traveled to Shanghai, China, to tour a Canon manufacturing operation where imageRUNNER and imageRUNNER Advance printers are made.

At the meeting, Mitarai detailed Canon’s “excellent global corporation plan,” now in phase four, and the six key strategies Canon is implementing to achieve the “overwhelming number one position in all core businesses.” These include expanding peripheral businesses, developing new business through globalized diversification and establishing a globally optimized productions systems. Canon is also establishing a three regional headquarters management system.

Despite setbacks like the 2011 earthquake in Japan and the October floods in Thailand, Mitarai said, both of which impacted Canon’s production operations, Canon anticipates a 5 to 7 percent sales increase per year from 2012 to 2015. At the end of May, he noted, the company showed global growth of 8 percent.

Canon listed net 2011 sales of 3,557 billion yen (roughly $44.84 billion), 27 percent of which came from the Americas. Of that, Canon’s office segment (including copiers, laser printers and digital printers) brought in 53 percent. The company’s ratio of research and development to net sales, executives noted, was 8.7 percent in 2011, higher than its competition.

In describing the company’s large-format printing business—bolstered by the acquisition of Océ—Yoshinori Ikeda, group executive, L Printer Products Group, Inkjet Products Operations, acknowledged that Epson and HP may have better brand recognition than Canon (which has 21 percent of market share), however Canon has a much wider product lineup. Its equipment covers not only the graphic arts (proofing, signs and displays) but also the CAD market, both color and black-and-white. Examples were given comparing Canon large-format devices with comparable-sized HP and Epson printers. Canon’s models had more compact footprints, were faster and produced sharper images.

When asked about further integration of Océ into Canon, executives noted that the Océ brand still has high customer loyalty, so it still may take some time to fully unify the two brands, though full integration is the long-term goal. (The integration of Océ technology into Canon products is already fully underway.)

IPG and other U.S. guests toured the Canon showroom for a look at Canon products over the years and got a glimpse of some newer innovations, like mixed-reality technology. They were also given a peek at some very interesting new products, still a year away from release (and thus under non disclosure agreements), which showed impressive advancements in color accuracy.

From Tokyo the group flew to Shanghai, China, then drove more than an hour west to the city of Suzhou, home of Canon's largest MFD manufacturing facility. Established in 2001, the plant now employes 8,594 workers. IPG and other editors walked through the facility, where hundreds of workers in blue caps quietly assembled imageRUNNER ADVANCE models like the C5051, C2030, C9075 and 8105. The sea of blue caps seemed to stretch to the horizon.

Chairman and CEO Katayama Kazunori explained that nearly all of the parts for the devices are manufactured on site. He pointed out the large injection molding machines used to create plastic molded parts for the machines. Making the parts in-house, he said, assures tighter quality control and saves money, since Canon avoids paying transportation costs for delivery of parts. He pointed out the quality assurance testing his facility conducts of the final products, which includes listening to them for "irregular sounds." All told, the plant produces between 700 and 1,000 units a day, he said.

This is just a quick summary of what IPG saw on this trip. Read the full story of IPG's Canon visit in the July issue of In-plant Graphics.