Discussion between Directors

On assuming the post of COO and Director

Okazaki: Since joining the Company, I have been involved in a wide range of work, including setting up new factories, participating in corporate planning, and serving as an executive officer for the Machinery Division and the European region, and have had many conversations with our stakeholders. Through these experiences, I have come to recognize the importance of the products and services that the Fuji Seal Group has created. Now that I have been appointed as COO, I feel strongly that we must continue to strive to bring peace and happiness to as many people as possible through packaging. Moreover, as our Guideline for Action states "Changing along with changes," we intend to keep our antennas tuned to changes in the world and create new value with greater speed and a more medium- to long-term perspective than ever before.
Umeda: When I was approached about taking the position of director, I looked back at how previous directors had served, and I realized that they were all people who had approached their work with the mindset of "Changing along with changes." In order to change, we need to take on challenges, and I have had a variety of experiences, including both failures and successes. However, nowadays, it seems like the spirit of challenging ourselves is fading because we are inevitably thinking about the risks first. I believe that as part of my role of director I must enhance our corporate value with my own actions by demonstrating the courage to take the first step without fear of risk.

About the deliberating bodies under the new system

Okazaki: Diversity is also extremely important on the Board of Directors. Therefore, instead of keeping the members constant, we decided to replace one inside director and one outside director. With this new structure, which now includes Mr. Umeda, I hope to have lively and frank discussions. At the meetings, I believe my role is to promote business operations and portfolio expansion while taking appropriate risks with a focus on how we can increase corporate value as quickly as possible, as well as to support efforts to increase the enhancement of our growth story. I also always try to be aware of whether there are any agenda items that are missing, and if there are, I try to raise those topics myself.
Umeda: I feel that the quarterly Board of Directors and Executive Officers Meetings have changed since IR members began participating in them. Rather than simply sharing the opinions of shareholders and investors, we incorporate them into discussions and use them as one of the factors in our strategic decision-making to decide what to change and what to maintain. It is important to gain new insight into how the Fuji Seal Group is perceived from the outside.
Okazaki: For example, when it comes to improving profitability, I have come to understand intuitively that we must work hard to make improvements, understanding that there are expectations not only from within, but also outside the Company. I think this is a big change.

Matrix management and new management plan "FSG.30"

Umeda: In the new management plan "FSG.30," the figures presented by executive officers in charge of businesses and executive officers in charge of regions do not match in certain details, but I think this is the advantage of matrix management. After all, we won't grow if we keep chasing the same numerical targets. I believe the ideal approach would be for each region to take responsibility for achieving the numerical targets, with the businesses then adding value to their results.
Okazaki: In fact, the profitability of each business has definitely increased, the strategies have become clearer, and the speed of execution has increased. Considering this, I also feel that matrix management is an effective system.
The profitability of each business has actually increased, and our strategies have become clearer and faster to implement, so I feel that matrix management is an effective system.
On the other hand, since one of our strengths is that sales departments formulate their own hypotheses and make a wide range of proposals, I feel that there may be challenges in the future in terms of the balance between business and customer perspectives. As COO, I need to think carefully about what kind of structure is necessary to maximize the power of each perspective.
Umeda: What is your view on the sales target of 350 billion yen? I think that while this may be a high target if we only consider our four existing businesses, it is an achievable number if we can promote new businesses such as the CMO business, Deep IS business, and aPT business.
Okazaki: I think it is challenging but not impossible; it's the perfect balance. Although we are not just pursuing scale, 350 billion yen is a milestone. By continuing to provide solutions that only Fuji Seal can offer, we see ourselves continuing to grow. Just imagining this is very exciting.

The Fuji Seal Group's strengths

Umeda: Our strengths are that we meet the needs of customers who operate globally through local procurement and local production and that we conduct local management. I think the latter is our greatest strength. By managing local human resources who have a deep understanding of local rules, including laws, and the local culture, we are able to make accurate decisions in a variety of situations. I believe that successful localization is the key to growth.
Okazaki: I agree. In addition, since we have customers in various industries in each region, we need to prepare solutions that meet their individual needs and challenges. In that sense, one of our greatest strengths is being able to provide total solutions that include not only labels and packaging but also machinery.
Umeda: When entering a new region, getting started with packaging requires significant investment and carries a high level of risk. First, customers in the region use our machines, and based on the market information we obtain, we can identify opportunities to enter the market with packaging. I think owning machines is a great advantage in terms of being able to create such strategies.

Thoughts on employees and society

Okazaki: Mr. Umeda pointed out that it has become more difficult to take on challenges. I would like to focus on creating a corporate culture where we "just give it a try." We conducted an engagement survey and received a lot of positive feedback, such as "We need to do more of this" and "This is what we would like to do." If each person can increase their motivation by even 1%, it will ultimately become a great source of power. I was able to feel that this is possible.
Umeda: What's important is for the Company to respond responsibly to the various opinions that are raised. I believe that the accumulation of these responses will lead to initiatives with a broader perspective on DE&I.^*
Okazaki: Our most important task is to embody our mission: "Fuji Seal will impact to realize the Circular Society that brings peace and happiness to all through packaging," and I believe that this will also create business opportunities.
Umeda: Recently, I have come to realize that there is a limit to what we can do on our own. We will work with our business partners and the entire industry to create packaging that contributes to the realization of a sustainable society and deliver it to our customers and consumers. I believe this is the role that the Fuji Seal Group plays.

*DE&I: Diversity, Equity & Inclusion. A concept that enables each person in an organization with a diverse backgrounds to thrive and continue to achieve results by providing them with the support they need.