Thursday, Apr 25, 2019
Industry & Trade | Asia-Pacific | Japan

Asahi Inovex Corp., Japan

The 'AUTO GATE'; an invention to protect our world.


3 weeks ago

Hoshino Mikihiro, President and Representative Director of ASAHI INOVEX CORP.
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Hoshino Mikihiro

President and Representative Director of ASAHI INOVEX CORP.

The ‘Auto Gate’ is Asahi Inovex’s solution to protect cities from flooding and natural disasters. After a successful track record in Japan, this life-saving solution is beginning to export itself. In this interview, the Worldfolio sits down with Hoshino Mikihiro, President of Asahi Innovex, to discuss Japan’s construction industry, the future and past of his firm, and the potential of its core product: the ‘Auto Gate.’

 

In 2019 and 2020, Japan will host two major sporting events, the 2019 Rugby World Cup and the 2020 Olympic Games. These events will further boost the nation’s tourism sector and are expected to have an impact on the construction industry.

The decision to select the Sapporo Dome as a host stadium for the Rugby World Cup has had a positive effect on Hokkaido’s real estate and construction sectors. However, Sapporo’s expansion of construction and infrastructure projects began before the Rugby World Cup was announced. In recent years, Hokkaido has received an increased amount of in-bound tourists, especially from South East Asia and China. These people travel for recreational activities and the hostelry sector has experienced a great boom. For example, the skiing resort of Niseko has become a tourist’s favourite destination. To accommodate for the growing number of tourists, massive development projects are in progress both in terms of hostelry and infrastructure.

Furthermore, the increased number of in-bound visitors has generated the renewal of international lines from Sapporo’s airports. Another interesting project is the new establishment of the National Ainu Museum, which Asahi Inovex is involved in.

 

In 2011, Japan was hit by a massive earthquake in the Tohoku region which shed light on certain infrastructural and civil engineering problems in the country. We saw a great boom in disaster prevention technologies and LED lights after the earthquake. How did this infamous incident shape the demand for anti-disaster measures? And what impact did it have on your company?

Asahi Inovex has three major divisions: civil engineering, architecture and steel, and house environment division. Civil engineering is of the highest priority because it serves as a backbone for social engineering and construction projects. Thanks to our expertise in civil engineering, we have successfully developed a major product: the “Auto Gate.” This technology prevents dams and rivers from flooding.

The ‘Auto Gate’ is designed to open-and-close by reacting to water levels on the inner and outer side of the gate. Consequently, it does not require man-power to operate. The product existed in the market since 1998, long before the Tohoku earthquake. Due to the national disaster, the demand for the increased and we introduced it in more areas. We received the Prime Minister’s Prize in the 5th Monozukuri prize Nippon Grand Award in 2013. We received that award because the areas where ‘Auto Gates’ were installed were not as damaged as the ones that didn't have the technology.

 

In recent years, we have seen Japanese firms tussle with their regional competitors over international construction projects, especially in South East Asia. What is the competitive advantage of the ‘Made by Japan?’

What distinguishes the Japanese construction-related businesses from its South East Asian peers is its vulnerability to natural disasters. This exposition to natural catastrophises has had an impact on the ways by which Japanese products are conceived and projects delivered. Furthermore, the process for acquiring the ‘right to build’ is very strict in Japan. In Japan, constructing a facility is bound to respect extremely strict standards. Because we adapt to these kinds of certifications, we supply high quality to any place in the world.

What many people fail to understand is that the cost of the “bid,” or the initial cost of the project, is not the final cost. Once the project is finalized, running costs will vary depending on its quality. Maintenance, repair, management… All of these running costs must be taken into account. Japanese firms are excellent at minimizing running costs and keeping a set time frame. This is not always true in other countries. For example, in South Korea and China, even if you extend the schedule by 24 hours you'll have to pay for an extra day. Consequently, running cost can outmatch the initial price.

In other words, while the initial investment may be higher, Japanese projects become profitable on the long-term due to their sustainability.

 

Can you tell us more about the origins of the Auto Gate?

There are two types of disasters. The firsts are natural disasters and the others are man-made disasters. Japan is regarded as a country where natural disasters occur more frequently than man-made disasters. Our ‘Auto Gates’ serve to protect people from natural disasters, such as floods and tsunamis. Traditionally, gates have usually been ran by electric or man-power. However, imagine if a disaster hits. You'd have an electric blackout and a lack of man-power to close the gates. This situation served as the departure point to design our technology. This idea served as a social contribution which brings more safety and confidence to people.

 

You were founded in 1952, a period where Japan was rebuilding its infrastructure and economy. Could you highlight the key milestones of your company since inception?

While the company's first goal is to have solid sales and revenue, we're putting special efforts in human capital. We want every single employee to be able to make a special contribution to the company. To raise our human assets to the next level, we utilize a metaphor: “climbing a ladder.” To reach the top of that ladder, we must work together as a team. This has been our foremost priority for years and it serves as our philosophy. We grow with our human assets rather than concentrate on one particular part of product manufacturing. Without our workers, we cannot reach great success. This is what distinguishes Asahi Inovex from other companies.

The second point is our R&D force. The company pays special attention to what is produced. To design new products, we often begin from scratch. This technique led to the creation of the ‘Auto Gate,’ which started as an idea. Another policy that we have is “all or nothing.” If we do something, we do it with our full strength. If our customers need something implemented, Asahi Inovex is the company that implements it until our customer's needs are fully matched.

Thirdly, not only do we fulfil our customer’s requests, but the products we make serve the customer's needs for a long time. We don't give up half way. The products we supply to the market reflect our objective for sustainability and long-term performance. We have confidence in our products but if our customers feel dissatisfied, we adjust it to their expectations.

 

In 2018, recorded net sales of 10.2 billion yen. Looking to the future, what's your plan to continue with your corporate growth?

One of the targets for our mid-term plans is to maintain a steady balance between the promotion and sales of the ‘Auto Gate.’ Over the 20 years of the product's existence, we've installed it in about 2000 sites, and that number keeps on increasing. One of our goals is to install our ‘Auto Gate’ in as many regions as possible. We've built a projection of possible areas where our ‘Auto Gate’ could be installed, and came up with the figure of 30,000 gates in Japan. The installation of these 30,000 gates is planned to take us 100 years. Therefore, we believe our company to be fine for the next century!

 

Which areas of development are you talking about?

Tokai Area has been slow in terms of disaster prevention technology, so it may be the next one to catch up. Two things are under our R&D activities right now. Firstly, we are trying to increase the capacity of the ‘Auto Gates’ themselves to serve as tsunami preventers, as our current gates have only been preventing river overflows. Secondly, we are making a new type of gate purposed to serve different applications. The idea is to take the automatic opening-and-closing function and apply it to civil purposes, such as in living quarters. Therefore, we are expanding into areas the company hasn't touched yet.

Another approach is to increase the functional side of the ‘Auto Gate’ and introduce it to other industries. For example, in Yokohama, there is a governmental office that runs the sewage pipes. Sometimes. there is an opposite flow of the sewage current. To block the opposite flow, the ‘Auto Gate’ may be introduced as it is not affected by the direction of the current.

In the field of civil engineering, we provide a full cycle of services, starting from planning, manufacturing and then sales. This integrated model allows us to offer more flexibility to our clients. We want to be able to mass-produce ‘Auto Gates’ on a greater scale and entrust our dealerships around the country to sell more to many other areas.

 

Are you thinking of also pushing your products outside of Japan. Are there any particular sectors you're thinking about exploring globally?

We already have several cases where we've successfully introduced our ‘Auto Gates’ to other countries, such as Thailand. In Thailand, we have the success story of an electrical power plant that stands by the seashore and which needed ‘Auto Gates’. Thailand successfully placed an order and installed the gate in one of their electrical power plants. We also went to an expo in Ho Chin Min City and attracted attention from Vietnamese government officials.They showed interest in the product but nothing has come of it yet. However there is still good potential for further growth in this part of the world. The problem in South East Asia is the lack of river leeve constructions. If you don't have enough river leeves for the ‘Auto Gates’ to be installed in, the lack of essential infrastructure makes it difficult to fulfil the customer's needs.

Another region that the company is looking forward to extend to is the European Union. Europe has a lot of old-fashioned preventive measures. We definitely see a chance to introduce our services there. And not only as solution providers, but as a way to renew existing natural disaster prevention infrastructures.

 

If we were to come back here in 10 years and have this interview all over again, where would you like to see this company?

The company has many gaps to fill and many goals to be fulfilled. There's still a lot of space to grow. Whether it's in civil engineering, ‘Auto Gates’, house environmental division, central heating or heating panels themselves, there are still many areas that can increase in sales and revenue.

Our first priority will remain the expansion of ‘Auto Gates.’ Next will be to increase the shares in central heating systems. Our heating and radiating panels enjoy the number one share domestically. While the basic technology was introduced from Europe, Asahi Inovex is proud to say that today it occupies a niche market in terms of heating panels in Japan. Over the next 10 years, we'd also like to introduce designing services for households.

Consequently, the next target for the company is to diversify our segments and expand in different divisions. With our capable and trusting workforce, future possibilities are endless.

 


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