What supported
the startling industrialization of Meiji Japan was not the direct import of
vain invocations from the West. It was individual businessmen of strong
character who, burned with zeal and the proud engineers, who absorbed new
learning like a sponge absorbs water and raced around the machines that
equipped the factory floors. Japan during the period of its industrial
revolution was very much like a living museum packed with energetic
industrialists.
Twenty-six-year
old Takeo Yamanobe was a foreign student in England who studied Economics and
Insurance at London University. In 1877, he unexpectedly received a letter from
Eiichi Shibusawa. The letter read something like this: “I heard about you from
a friend. In Japan, state-owned spinning mills are in a poor state and the
import of cotton yarn is huge. For the good of our country, it is imperative
that we establish high-performing spinning mills under Japanese control. For
this to be possible, people familiar with technology and operations are
indispensable. I plan to set up a spinning mill and I ask you to forget
economics and start studying the technology of Britain’s cotton industry”.
Enclosed with this letter were entreaties from his father and friends. How bewildered
Yamanobe must have been at such an audacious proposition! Nevertheless, after
some consideration Yamanobe decided to accept Shibusawa’s request.
Yamanobe
transferred to Kings College and began to study Mechanical Engineering.
However, he noticed that his course focused on theory and was not linked to
practice. He moved to Manchester, which was the center of the world’s cotton
production at the time, and there he visited factories and advertised in the
newspapers requesting “employment as a trainee who was willing to pay tuition”.
He suffered countless rejections. At long last he met Mr. Braggs, the owner of
a cotton textile factory, and for the next eight months he learned the ins and
outs of cotton spinning – from ginning, spinning, and finishing to the purchase
of raw cotton, the sales and marketing of finished goods, packaging and
shipping. The cost of the trainee-ship was covered by research funds of 1,500
yen that Shibusawa sent to him. Regarding this large sum, Shibusawa remarked:
“It was a leap of faith, like jumping down from the stage at Kiyomizu temple
and hoping to land well”. Yamanobe was the first Japanese to learn the latest
theory and practice of cotton production and before he set off for home he
purchased spinning machines and steam engines from Pratt & Co. and
Hargreaves & Co.
On his return,
Yamanobe, together with Shibusawa, set about locating a site for the mill. Moreover,
Shibusawa has raised 250,000 yen in capital from businessmen and nobility, and
had arranged for the operating costs to be financed by the First National Bank,
of which he was president. In this manner, the Osaka Spinning Company was born
in 1882. From the very beginning, the performance of the company was startling.
Both on the technology and management fronts, ideas of the past had been thrown
out completely. Innovations featured a five-fold increase in output capacity,
the use of steam power, locating the mill in a large urban area and not in the
backwoods, round the clock production, the selection of goods that would not
compete with Britain, and a shift to using cotton from China as opposed to the
domestically-grown cotton as the raw material. Stimulated by the rapid success
of Osaka Spinning, Mie Spinning, Kanegafuchi Spinning, Settsu Amagasaki
Spinning and host of other mills modeled on it sprang up all over Japan. Thus,
cotton spinning grew into the key industry of the Meiji period.
However, in the stock companies of
Meiji Japan, including the cotton industry, the voice of shareholders who had
little knowledge of industry was powerful, and they severely criticized the
management if investment returns fell short. In contrast to this, technical
experts like Yamanobe, who had a deep understanding of industry, bore the
long-term development of the business in mind rather than focusing solely on
short-term profit when working out production and investment plans. This was
the archetypal clash between the owners and management. Particularly during the
recession around the 1900s, this confrontation between the owners and
management heated up at Osaka Spinning, and the president and shareholders
alike criticized Yamanobe, its chief engineer. Discouraged, Yamanobe went to
Shibusawa to tender his resignation. Instead, Shibusawa firmly supported him
and advised him to remain in his post. Finally, as the economy recovered,
Yamanobe was appointed president of Osaka Spinning as a specialist who combined
technical knowledge and management experience.
QUESTIONS:
(i) What if
Shibusawa had not sent that first letter? or
(ii) What if
Yamanobe had persisted with his study of economics? Or,
(iii) What if
Shibusawa had not supported Yamanobe in his time of difficulties?
It is possible that the cotton
industry of Meiji Japan would not have emerged. The source of the vitality of
the Meiji economy was the social environment which produced men of caliber such
as Shibusawa and Yamanobe one after another, and that is the secret of the
country’s phenomenal catch up.
( Culled from Industrialization and Global Integration of Meiji Japan)
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