Designed and manufactured in Japan, Nagano Industry has a long history and extensive technical expertise in crawler tracked boom lifts. These machines have been developed through empirical observations on worksites as well as feedback from customers who work in challenging conditions on building sites across the world.
Since the end of WWII Japan has developed an excellent reputation for its attention to detail and the kaizen philosophy of manufacturing has become famous throughout the world. Now of course over the last 20 years, regional competition from China, Korea, and Taiwan threaten Japan’s market share. Yet today we still see Japanese companies retain niche B2B leadership in certain fields characterized by high-mix-low-volume production. Can you give us your take as to why you believe Japanese companies are so successful in these B2B fields? What are the qualities of Japanese manufacturing?
Importantly, first, we must define what monozukuri is, and for us, there are two points to consider when defining monozukuri. Firstly, monozukuri resembles your attitude and what makes your heartbeat in the way of showing a true passion for making things. It’s not enough to just have an interest in what you are doing, but it is equally important to have a curiosity and an open mind to make things whilst observing all around yourself. There are those that are capable of following monozukuri and those that cannot, and this is human nature. We are all different, and everyone has their own personality and characteristics that make each and every one of us unique.
Back in the day, I visited Hanover, a city in Germany only 100km away from Hamburg and the home of the world-famous German automotive company. I stayed there for 4 years working hand in hand with the production there, the German people were so passionate about touching and handling mechanical devices. Age and gender didn’t really matter, instead, it felt like everyone I met there was passionate about the mechanical side of the output. As an example, if you disassemble an engine to its individual components, the staff were all fascinated by the workings and how the engine operates. I really saw a lot of people contributing to the overall process and showing a real passion for what they were doing.
Of course, the reason I mention Germany so much today is that so many of history’s greatest manufacturers have originated from Germany. I often ask myself why that is, and I think that the answer simply is because the people of Germany really love what they do.
Another country that I witnessed having a passion for manufacturing was Sweden and its famous automotive manufacturer. I went on to the factory tour in the past and I was able to witness the production side of their operations. One thing that left a big lasting impression on me was the sight of children coming into the production facilities and holding the hands of their parents before clocking out for the day. It left such an impression on me because even small children can grow up in that environment and see the plant and how it operates, and it made me think that perhaps this kind of sight at an early age may trigger a child’s interest in the creation and the art of making things. It also creates this sort of family environment where generations of family members may work in the same place.
Each company has its own policies and its own motto. Managerial standards and operations are different too, with every company being unique in its own way. Nevertheless, it is very important for companies to build their own cultures and environment, and thus foster their human capital in a very natural way. That brings us back to the essence of monozukuri, which is this aspect defined by an endless interest and curiosity in creation. It really is something that is deeply embedded in your soul from the beginning, and that essence must be fostered and carefully nurtured.
I’ve mentioned a lot about foreign monozukuri, but I would like to bring our conversation back to Japanese monozukuri. Traditionally Japanese monozukuri characterizes the national identity, and Japanese people are very keen on the quality and standards of the activities they do. For example, if you are a carpenter, you tend to make the best wood products possible, and when you do your work to the best of your ability you gain recognition. That further leads to appreciation and respect, and this is deeply embedded in the culture of Japan.
Today we are in the heart of Nagano prefecture, and we are more or less a rural area company. However, it is surprising that there are a lot of companies here doing things related to manufacturing. Actually, Nagano has a long history of hosting many companies, with many of them known for their production and monozukuri culture. Besides the big companies such as one of the leading printer maker or precision instrument makers, there are a lot of SMEs that you wouldn’t know even existed, and many employ skilled engineers.
Japan is famous for having its super-aging society. Of course, we also see a lot of emigration taking place, with people moving from rural areas to big cities like Kobe, Osaka, and Tokyo. It is possible that areas like Nagano suffer from a “brain drain,” and as such, there are issues in passing on skills and knowledge to the next generation of engineers. In the case of Nagano Industry what are you doing to retain labor here and in terms of your market how are you ensuring that your market is sustained?
It is a big issue for us obviously, and the decline in the overall population of Japan as well as the movement of people from rural areas to big cities are creating huge issues for us here in Nagano. Frankly, there are a lot of things that lead to this point and there is no one solution to the issue at hand.
It is important to firstly ingrain the seeds in people’s minds on what Japanese monozukuri is about, thus making it attractive. I think the aspect of leadership is very important, and perhaps a solution to the issue. Two years ago we felt that this was a big problem, and we attempted to solve it by diversifying our management team. In fact, if I remember correctly, two years ago people weren’t really talking about these social issues at our company. When I look back two years ago we didn’t have the management positions we have today, and certainly, we did not have any female members of staff filling those management positions that existed. The same could be said for foreigners too, and it is my belief that diversification has been of benefit to Nagano Industry and additionally a solution to these nagging social issues. Right now we have 5 female staff members filling out managerial positions out of the total of 26 we have in the company. To offset the decline in potential recruits domestically it may become important to begin the fostering of human capital recruited from abroad, and as such we want to continue to encourage further diversification when it comes to management within the company.
The use of digital tools is also critical for aerial platforms functionality and performance in order to tackle personnel shortages, and I believe this trend of their adoption will continue to grow. For instance, we will introduce new models next year that have two distinct digital systems. The first is a status tracking system that can monitor machines' status remotely without operators around. These technologies will enable the user to know the machines' status and whereabouts remotely. Not only its operating condition but also for emergency situations, for example, if they are stolen the user can disable the engine remotely. Secondly, by installing a remote failure diagnosis system service staff can quickly determine system malfunctions. These digital tools require less labour with the added benefit of providing a quick and efficient after-sales service.
Nagano Industry has a long history in acquiring expertise in crawler-type and wheelbase aerial lifting systems. What do you consider to be the most important technical milestones in your company’s history?
We have been working for a long time as an OEM company, and back in the day, we did a lot of different OEM productions such as TVs and Printed circuit boards (PCBs). We have created PCBs on a commission base starting from design all the way to production.
It is very rare that a construction machinery company can do this kind of thing. We also have our controllers that control the aerial lifts; an original Nagano Industry design and everything here is produced purely by us in-house. That applies inside as well, all the way down to the wiring.
Another milestone is with our articulated boom lift. An articulating boom lift, also known as a knuckle boom, has a lift arm with multiple sections separated by joints, or knuckles. The arm can move the work platform over and around obstacles. Telescopic booms have been produced by the company since 1984. A telescopic boom lift has a mast that extends in a straight line by using one or more telescoping boom sections. This design gives you the vertical reach you need to access overhead jobs, while also providing outstanding horizontal reach. The telescopic boom is a much more traditional type of boom and has the nickname the straight boom. Up until this year; in 2022, we have shipped over 4,000 units of this telescopic type boom for the domestic market. The advantages of the articulated type are that it is compact, and easy to operate. The telescopic type is much better in narrow spaces and very capable of bending and extending. There is another type, known as the crawler type, which enables work to be done on uneven ground. Our know-how and expertise are something that distinguishes our company.
Could you highlight some of the features that you’ve been able to integrate into the latest generations of both your articulated and telescopic boom lifts?
First of all, we are proud to say that everything we do is done in-house, meaning that we control devices and software. When you take a look at our crawler type, we have a special type of undercarriage that runs on rollers which allows for a smooth relocation and a good balance of features. The boom lift itself does not tremble or shake when operating at a large scale, and the hydraulic and electric lines is actually inside the boom itself, and this is a big advantage compared to most other companies that have this line situation outside the boom and exposed which may damage the lines. It is actually quite difficult to run that through the boom itself because the space inside is quite limited and small, and many companies have struggled to fit all the cables inside whereas we have been successful. The machine itself is quite complicated with two different types of cables, and special types of valves.
Once the boom reaches the level of operation, in traditional types, oil leaked and the platforms descended without operation. For that reason, we developed our own types of special valves to prevent leakage.
When it comes to the articulated type of boom lift, we are very proud of how small and compact it can become. Obviously, with any boom lift, there is a requirement to operate at a high level of elevation, but the key feature of the articulated type is its ability to fold down to that compact size. In order to create this foldability, there are a lot of small, complicated, and detailed components on the connection side. Another thing to consider is the safety of the operator, and therefore accurate connections are crucial and key to the features of this particular type of boom lift. This has come from our expertise and we have dedicated a lot of time to making this level of accuracy happen. With this compact boom lift, the articulated type can be applicable for small car trailers and camping vans, and therefore the vehicle is not just for construction trucks.
Are you looking for partners overseas?
We are, but not so much in co-research and co-creation activities. Our overseas partner activities usually involve parts procurement, and a lot of parts manufacturers are producing parts for us. In the business that we are in, there are a lot of parts that we still cannot make ourselves, and even parts that cannot be made here in Japan. Some components that we need for the articulated boom lift are only produced in Europe, so when that is the case we must procure those parts from the source. Others include parts that are required for CE certification. CE marking indicates that a product has been assessed by the manufacturer and deemed to meet EU safety, health, and environmental protection requirements. It is required for products manufactured anywhere in the world that are then marketed in the EU.
Can you tell us moving forward which international markets and which particular countries do you see as having the most potential for future growth?
We just started our expansion in Europe, and it has only been two years since we started our activities there.
In Europe, we didn’t have a subsidiary, so we were not recognized enough, on the other hand, our products have had great reputations for their quality among users. So it is very important to establish a presence there in order to expedite selling in the region, and for that reason, we established the company in Europe in October 2022. We already started publishing HP, trading spare parts and providing services with well-experienced engineers. We have also worked on a booth for visitors, and we actually have quite a number of visits by prospective customers every day. We hope to attract people to come and see what we do and how our machinery works.
The following types: 12- and 15-meter telescopic, 9-meter articulated, and 11-meter heavy-duty, are the ones that we have introduced to Europe. They are very user-friendly and have received a lot of good feedback from existing customers. The machinery that we make is very unique in a way and none of our competitors can produce the same.
I’d like for you to imagine that we come back in 4 years to celebrate your fifth anniversary as the president, what dreams or goals will you like to achieve by then and what would you like to tell us in that interview?
I have personal targets, however, let's not forget about the company too, especially when you consider that I am the leader of said company. I have a target for JPY 10 billion in sales and this is double than our current sales, meaning this will be a challenge. I would like for our company to continue to stand firmly in our niche market. I also aim to be profound when it comes to global expansion in foreign markets, and Europe and Asia are the regions that we have the most interest in right now.
Our products are defined by our high safety standards because they operate in the dangerous environments of construction sites. All of the machinery we introduce to the market must comply with the safety standards required by the region of our customers, and from that perspective, everything we do must pertain to a good quality. The market itself is more or less stable, and we are anticipating many years before we see any significant changes in the market’s direction. What this means is that as long as you are making high-quality and reliable products that can meet the safety standards of the world then you will find users and customers that wish to utilize your products. It is very hard to imagine a world that would not require the products that we make.
If I bring it back to that JPY 10 billion target for a second, there are several targets set in place to help us achieve this goal. First of all, we have the continuous development of our human capital with the idea that all staff will be of the same mindset and share the vision for the company’s future. We hope that this attitude not only expands within the company but further out to our customers as well, with the mindset that safety must always come first. As long as this foundation is put in place I really don’t see any goal or target as being out of our reach. Of course, we mustn't forget the technical side too, and importance is put on the continual R&D efforts that we make. R&D principles at Nagano all adhere to the same principles of safety and reliability that every other effort the company makes, and with the world shifting its attention toward the electrification of vehicles across the board we are excited about the prospect of electric construction machinery coming up very soon. A new business approach is always an exciting prospect, and we are looking into new opportunities in the production of more eco-friendly products that contribute to the well-being of the planet.