Management: People put before profit: Omron, the electronics company, aims to enrich human life. Roger Trapp investigates

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The Independent Online
FOR ALL the talk of the importance of ethics in business, it is still tempting to dismiss a company that purports to put reputation before profit. But Omron Corporation of Japan does just that and last year achieved worldwide sales of more than pounds 2bn.

Founded in the Fifties by Kazuma Tateisi, father of the present president, Yoshio, the electronic components and equipment maker has moved into Britain only in the past year. But earlier this month it made its commitment to the country clear by opening in north London a customer demonstration and training centre for its complete range of factory automation products.

Unlike other Japanese companies, Omron is not likely to be a source of many jobs. It employs only 20,000 people around the world. The factory automation centre will bring its UK workforce to 300, adding to those at its factory at Telford, its sales and marketing company for electronic point-of-sale products at Chessington and a software development base at Southampton.

Although Britons account for 99 per cent of these employees, they still find the way of life a little hard to get used to, according to Mr Tateisi and his team. For a start, there is 'Omron Day' held on 10 May for the first time this year to celebrate the anniversary of the company's founding. The organisation was shut down around the world to allow the employees to show commitment to their communities and to building 'a better world for all' by doing voluntary work. It is, said Mr Tateisi, a small gesture, but a practical extension of the company's motto: 'At work for a better life, a better world for all.'

Even the choice of products is a result of this attitude. While many might feel that the development of labour-saving devices spells the end of many people's jobs, Omron takes the view that by getting machines to do repetitive tasks, man is freed to do more fulfilling work. In the words of the late Kazuma Tateisi: 'To the machine, the work of the machine; to man, the thrill of further creation.'

And then there is the emphasis on research and development. The worldwide economic decline has led to a rapid reduction in demand for Omron's products, which include automatic cash dispensers, ticket machines for railway stations, healthcare products such as electronic heart monitors, car- wash equipment and factory automation systems. But rather than retrench, it has thrown itself into developing new products - particularly in the fields of micro-electronics, opto-electronics and computer communication networks - in order to be able to move into growth markets.

Omron feels it is better able than most to spot areas of expansion because of the philosophy behind its overseas operations. As part of its 'Golden Nineties' plan, it aims to develop by 2001 a form of decentralised management it calls the 'multilocal' - in contrast to the more usual multinational. The advantage of this, Mr Tateisi believes, is that it makes the company more responsive to local markets and more flexible.

While many multinationals are busy trying to sell the same products to the whole world, Omron acknowledges that not every country has the same needs or demands at the same time.

Through this approach, Omron introduced its automated management of energy, temperature, security and lighting for buildings in Europe before it did so in Japan, because that was where the demand was, and also where the local R&D team developed the system.

All of this is being done at great cost to the company's balance sheet. Last year, net income showed a larger than expected 71 per cent fall to pounds 29m. But then Omron has never been obsessed with profit.

It sticks to its founder's notion that profit is related to contribution to society - which means it believes it will get its reward if it can respond properly to the changes in society that it terms industrial, social and personal.

'We want to make human life richer and more enjoyable,' said Mr Tateisi.

(Photographs omitted)