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Nikkei Interview with Bull-Dog President Shoko Ikeda

October 12, 2007
By Ken Worsley


I might mix what I’m really thinking with a tad of sarcasm on this one, so bear with me.

First, I love Bull-Dog sauce. It’s great stuff. I think the company has lots of potential to sell it overseas. It’s much better than what Kagome pumps out as an excuse for thick Worcestershire-style tonkatsu sauce. That said, I’ve always been confounded by the image of Bull-Dog president Shoko Ikeda that we’ve seen in the media. I poked fun at an article back in July that said she comforted her employees by, “offering beef-on-rice dishes, vegetable soup and other meals she cooked herself at the company’s headquarters. She carefully looked after the health of her staff, telling them they had to build up their strength and eat enough vegetables…”

Since when do CEOs cook for their workforce? The article portrayed her as some sort of super mom rather than a savvy corporate executive. I’m going to leave the question as to why the reporter did that (and it was intentional) purposely open.

To the point: An interview with Ikeda has appeared in the Nikkei today. Towards the beginning, Ikeda states:

Some people say the company became a takeover target because management was not vigilant, but that is totally wrong. Immediately after I was appointed president in 2000, we checked the list of shareholders, and even afterward I had the stock price and trading volume reported to me daily.

With regard to hostile takeovers, we considered various defenses, including a management buyout. I don’t think anyone has thought about this as much as I did.

First, the statement that ‘management was not vigilant’ is not proven wrong by the fact that Ikeda “had the stock price and trading volume reported to [her] daily.” The opposite is the case. How is a CEO not checking the share price and volume on his or her own? This reminds me of a book I once quit reading which claimed that Emily Dickinson was not a shut-in because she wrote numerous letters to the woman who lived next door. Fact is, Bull-Dog had insufficient risk management in place to deal with hostile takeovers.

The image I get: An aloof CEO.

Next quote:

[During the takeover bid] [n]ot a single worker quit. To the extent possible, I went to their workplaces and briefed them on the situation. I said to them, “We are taking steps to improve the company’s value, such as buying Ikari Sauce Co. and investing in plant and equipment. I would like each of you to steadily do your jobs each day.

Major points to Ikeda here. It seems as though clear, strong channels of communication were established and kept open. Problem recognized, solution identified, acted upon and communicated to the workforce. Whether or not telling employees which firm you’re attempting to buy out constitutes insider trading is not my place to judge.

Then:

Employees choose to be at a company, and to work hard in order to obtain the necessities of life. Something akin to pride is also born if they can help society through the work they do.

I’m not sure how making sauce helps society. I wouldn’t even give this claim to Tobasco.

As long as you are working in a capitalist society you cannot deny the market. If a better manager than I am emerged, I would have to yield my position (to him) because it is the mission of a company to improve its results and increase its contribution to society.

Him??? Come on, Nikkei!!!

Regardless of which company they may go to, I want our employees to take pride in the way they live their lives. In any age, the only thing a person can rely on is themselves.

That last sentence is absolute truth. It’s good to hear a CEO recognize that employees do move on, and that it’s her (and the firm’s) duty to retain them. Overall, I found the interview superficial, but I gained an insight into Ikeda and heaps of respect for her. I had respect for her before for being tough in the face of a hostile takeover, but I think she runs a good ship, aside from risk management.

That said, I think Bull-Dog’s anti-takeover defense measures were completely illegal, regardless of whether the courts sided with them.

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Comments

4 Responses to “Nikkei Interview with Bull-Dog President Shoko Ikeda”

  1. Garrett on October 16th, 2007 5:02 pm

    Him??? Come on, Nikkei!!!

    That’s the sarcastic part, right? Come on, JEN!!! It’s generic male pronoun. The only difference between using it and using “they,” is whether you think the number of people involved or sex is more important and I have yet to hear an argument based on anything other than desperate political correctness for the latter, which is kind of sexist, sint’t it?

    Anyway, that’s not the point. I would think that the very fact that Bull Dog found itself in the position it did would be evidence of poor risk management. I also agree that the legal decision in this case was baffling, but there seemed to be a widespread, almost national consensus that the hostile takeover was a dirty act. Steel Partners had the deck stacked against them in every way except for the ways should count.

  2. Ken Worsley on October 17th, 2007 12:17 am

    Garrett,

    Disappointing argument in the first paragraph.

    I would think that the very fact that Bull Dog found itself in the position it did would be evidence of poor risk management.

    Agreed with that second paragraph. And to some, the ruling makes sense because proper risk management is oh-so-costly for these firms that exercising it would damage shareholder value. Thus, firms need to be protected by the courts just like mom and dad used to sweep the bogeyman out from under the bed.

    I doubt anyone arguing that line is being head-hunted for risk management positions.

  3. Cervantes on October 17th, 2007 11:25 am

    Since when do CEOs cook for their workforce? I can answer that for you, Ken. Since 1920, at Matsushita Electric. Shoko Ikeda behaviour really respond to Konosuke Matsushita kind of management.

    An aloof CEO? My image it’s quite different. I would like to suggest you to read “Keiei no kokoro: Matsushita Konosuke to tomoni gojunen” by Masaharu Matsushita, PHP Institute Inc., 1995. It really helps understand japanese mind at bussiness to me.

  4. Ken Worsley on October 17th, 2007 12:44 pm

    Cervantes, I’ve not read the book in question. But comparing business in the 1920s to today’s global market where the risk of being bought out by internationally active funds makes little business sense. I’m not sure if you’re implying that’s where Ikeda finds the basis for her actions, but it seems that just makes her seem even more aloof, and further supports what I’m thinking. Now I would have to say ‘unable to react to contemporary market realities.’ And this is a company I really like…

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