Rohm and Haas Japan K.K.

Mr. Thomas Nevins and TMT Inc. could do a lot more to help foreign capitalized firms in Japan. However, the starting point comes from clients like myself and my company. We have to commission him to do it, instead of working on the more pressing matters on our desks. We also have to suspend our disbelief that a foreigner who came to Japan on his own, and built up an independent consulting business can bring so much value, and be so much better than ourselves and the other professionals (in his area) we surround ourselves with and depend on. I had already heard the answers and advice from our law firms, and other professional advisors, “very difficult, maybe nothing can be done, and those (TMT’s) method would be illegal.” (Of course they can’t grasp the method in a perfunctory discussion.)

The other thing that I personally still have to deal with is getting used to the appropriateness of getting help from an outsider like Mr. Nevins, rather than doing things on our own and within our company. But there is truth in what Tom Nevins says when he tries to counter my feelings or thinking in that area.

He points out that a former foreign President of Rohm and Haas consulted with him back in 1988. Tom admits maybe he did not keep pursuing things hard enough, but at that point, 12 years ago, there was a relationship, and at least Rohm and Haas was given an option to make changes that Mr. Nevins still feels would have greatly helped the firm in Japan. Mr. Nevins also worked with me when I was with my previous employer in Japan. So maybe Mr. Nevins is the one who is around, and in a position to in some ways be more responsive and responsible than the rest of us! Mr. Nevins has not worked for all the foreign companies in Japan, but he certainly does get around. He certainly has done a lot.

Mr. Nevins guided us, and implemented with us exactly what he said he would do. It was a very difficult thing, that alone we/I were not able to do. Yet as far as more thoroughly using TMT, we still keep the parking brake on, and don’t let our vehicle in Japan smoothly cruise ahead to reach optimum speed and efficiency. Why is that?

I guess the answer lies in inertia, a continued fear of the unknown, a hesitancy to pile too much on one’s plate, and perhaps our own/my own resistance to change, and to take a position, and move ahead.

The particular specific project we wanted Mr. Nevins to help us with, began with a July 1, 1999 dinner at the American Club. We had invited Tom to dinner. Then schedules and priorities being what they are, the next meeting at the Tokyo Rohm and Haas office with Tom was 4 months later on November 5, 1999. Then it was not until 7 months later, on June 1, 2000, that we had the Japanese manager in charge meet with Mr. Nevins. So it was exactly 11 months before the key implementer, met up with Tom Nevins for the first time.

But the problem was continuing. For another year we had been paying salaries averaging about 10,000,000 Yen to a few individuals. We had been trying to get them out of the company for a couple of years. In this case moving in a timely way does save tens of millions of yen. However, more important is to demonstrate to a highly unionized environment (51 union members out of 55 employees) at the factory that management can make headway, even when a strong union is indicating it will protect these union members from being dehired.

We picked up the pace from our side. For the first time on July 13, 2000, Mr. Nevins met with the Asian regional manager. At this point we were finally ready to move. We switched from Mr. Nevins hourly invoicing to the fixed project fee he quoted us from the beginning.

We got things ready and on August 21, 2000, Mr. Nevins delivered about a two-hour seminar to everyone at our Nagoya factory. The next morning on August 22, 2000 we had a meeting with the union. It included the outside, upper body union spokesman who did most of the talking. The union, of course, indicated its displeasure with Tom’s seminar from the day before. Just the same Mr. Nevins’ messages registered on people. Mission accomplished. There is reason in Tom’s madness.

That same day Tom had his first meeting, on a group basis, with the few individuals who had been refusing to accept “voluntary” retirement programs, and who had been resistant to our one-on-one pressure to get them to leave. At this point our Japanese manager was working fairly closely with Mr. Nevins, in meetings and by phone. To take things to a concrete stage Tom made a first draft of the resignation letters for these designated-for-resignation individuals. The package we offered them was “only” 12 months. I say “only,” because the packages we had been using were much larger than this 12 months, which was much larger again than the ones TMT usually works with or recommends.

For example on November 1997 under the auspices of the Labor Relations Commission (LRC), our company signed an agreement that we would pay a maximum of 31 months to those 54 to 57, and minimum of 27 months to anyone below age 50. The individuals we asked Mr. Nevins to help us with had refused that package.

In July 1999, just a year earlier, 22 months had been dangled in front of their faces. They had resisted pressure again to take that generous package. This time, offering 12 months, or just about one-third of the November 1997 package, and one-half of the July 1999 package, how did we manage to get them to resign and sign within the one-week signing deadline?

It is the difference between using TMT and not using TMT. But the answer is more detailed. Mr. Nevins made a careful judgment with us, that he would not further pressure them after his August 21, 2000 seminar with all the employees, and his August 22, 2000 meeting with the individuals. Mr. Nevins did not even visit Nagoya after August 22. So a big part of the success was the way we set up the exercise, communicated the issue to everyone in the plant, the perspective Tom gave us, and the way he coached us. In the final days, it was my Japanese manager who carried out the exercise to completion and made it happen.

And that is exactly the way we both wanted it if possible. Tom honestly joked, “I’m on a fixed fee anyway, so there is nothing more I would like than not to have to take another three hour trip (one way) to Nagoya.”

There is one more thing that our Japanese plant manager had been doing, and Tom wanted to do in his way before he was willing to leave us alone with the individuals and their resignation letter signing deadline. Mr. Nevins communicated with the outside, non-employee union leadership by phone three or four days before the signing deadline. They had a long talk, also about the way they would need to cooperate and work together in the future. Tom asked for the union’s help and reassured them if he could depend on the union’s help, he would not have to pull the individuals into another meeting on the subject.

Mr. Nevins knew that the individuals being asked to leave trusted their upper-body union leadership greatly. Mr. Nevins and we, paradoxically enough, credit our success with this problem also to the union leadership. The union was able and willing to see that the company really was determined to succeed this time. The union also appreciated that cooperating on this case would be in the long term interest of the other employees in Nagoya when it comes to decisions about which plants in the Asian region will benefit from investments in automation and modernization.

More than a year later Tom helped us with another situation where we were having difficulty getting results on our own. Being an outside third party helped. But his rich experience, hours of attentive listening, and careful effective communication was crucial to our success.

Like so much in management and life, Tom Nevins helped us see that thought, determination, and communications are important to succeed.

Mark P. Maguire
Rohm and Haas Japan K.K.
January 2002