Manufacturing with passion is at the core of the Star-M’s philosophy as the Japanese drill bit maker celebrates its 100 year anniversary. We sat down with President Tokiko Kobayashi to learn more about their business as the company celebrates their centenary.
Since the end of World War II, Japan has established an excellent reputation internationally for its attention to detail and kaizen philosophy of continually developing a product. Still, Japanese companies need to adapt to quality, cost and delivery (QCD) to be competitive on an international stage. As a company specializing in woodworking tools, could you give us your take on the advantages of Japanese manufacturing?
Japanese manufacturers constantly employ creativity and the kaizen philosophy in every product they manufacture, while simultaneously listening to their customers' voices to determine what they want. The totality of such an approach represents the Japanese monozukuri industry. I believe that by manufacturing with passion, the final product will be strikingly different. We think this makes a difference, which is the philosophy our employees uphold. They display a passion for the individual products they manufacture.
Japan is a super-aging society, where more than 28% of its population over 65, and with a fertility rate of 1.37, its population will continue to decline. It is predicted that there will be less than 100 million by 2060, creating two issues. The domestic market demand is shrinking, and it is becoming more difficult to transition the knowledge from engineers and staff to the next generation of workers. How are you adapting to these population changes?
Now, we are trying to automate our processes as much as we can and create manuals to save power and resources. It is getting more difficult to recruit young talents to whom we can pass down accumulated technologies, posing a huge challenge to our business. Therefore, we are creating manuals for the next generation, but the challenge is incorporating more than the process steps. We also want to include the perceptions of our veteran workers in those manuals to accurately transfer our technologies to the next generation. While it is ideal for younger workers to absorb knowledge and skills directly from seasoned workers, it takes time for them to grasp the key points and know-how, then put them into understanding and analysis.
Hence, there is a lot of reliance on the competence of skilled workers to proceed as planned. However, we believe that the awareness and experience gained by being conscious of manualization will give young talents a lot of insight, from which they can then move on to the next step in their development.
At the same time, we are committed to creating an employee-friendly work environment. Together with me and one of the board members, many women work at this company as well as at our plant. Several of them return to work after taking maternity leave. We are working to create an employment environment that enables employees to balance work and childcare.
Living through the Coronavirus for the past two years has severely impacted businesses worldwide. China's zero-tolerance policy has disrupted logistic supply chains, and the procurement of parts has become more difficult. What was the impact of COVID-19 on your business?
The COVID-19 situation has undoubtedly generated countless uncertainties, but we have been fortunate to continue our business as usual. I am very grateful to my employees for their good management of the production.
We faced some challenges in procuring parts related to the peripheral products, but we maintained the supply of the parts for our main products because we always are careful to ensure we have ample stock material, and we can do so because of the close relationships we have developed with both our suppliers and customers. In fact, it has been an aggressive couple of years because we had a hard time catching up with the orders and demands.
As a new initiative, we were able to take advantage of social networks. The result of our collaboration with a YouTuber to showcase some of our products was an increase in our customer sales channels since more people do online shopping and watch YouTube videos. We found a lot of opportunities from the demand that emerged from the stay-at-home lifestyle initiated by the pandemic because more people became interested in DIY.
I believe that as long as our products are attractive, people will be interested and patronize them, and that this would hold true even when we face tough times such as now.
Star-M's products are a B2C product. What was the purpose of establishing the WoodOwl brand name for the US market in 2003, and what are your best-selling products there? What are you focusing on selling in the Japanese market?
Technically, instead of B2C, we use sales agencies. We directly showcase our products; however, our customers need to purchase our products through our sales agencies.
There were many struggles and difficulties in setting up our company in the US, and we did a lot of groundwork. Before that, we had a 70% market share in the domestic market, and we had plans of growing that share. However, since the Japanese market size is not going to grow further, we decided to expand overseas. As we looked for potential markets, we decided to challenge the US market. We only had single spiral products in the beginning, but we eventually tailored our products to meet the needs of our clients, so we produced drill bits with double and triple spirals.
Their specifications greatly vary from those of Japan. When natural disasters occur, like hurricanes or forest fires, they need to do repair work on their electricity wires or wooden pylons. One of our drills which is often used by American line workers works very well for their pylons. Our clients have said that with our Tri-Cut Drills, which are often used in the construction of two-by-four houses, they were able to bore highly accurate holes through the wood.
Star-M Int. Ltd. “WoodOwl” Brand - Tri-Cut Ultra Smooth Auger Bits
How do you ensure the accuracy and consistency of drilled holes for the varying types of wood users may work, either hard or soft woods?
We procure the materials for testing whenever launching a new product, as well as for improving our existing products, to comply with new work methods and new materials for various markets. For the US market, we use their actual power tools and tools to perform several tests. When we drill holes into new material, we do many trial-and-errors to adjust the design and model to bring about the perfect hole. We continuously listen to our customers. Our local staff directly gather information from the linemen and also join exhibitions so that they can communicate with the end-users. Through those events, we are able to identify the exact specifications, in terms of length and thickness of the drills for example, that the market prefers and demands for their problems.
Our testing to find out the best shape or drill for our customers is not limited to the US market, but that is our philosophy throughout Star-M Corporation. We try to deliver whatever our customers want, “even when they only ask for one product or one large quantity.” Our mission is to give shape to what our customers want.
Since your products are modular, what steps do you take to ensure that your products are compatible with the different power tool brands in the market?
All power tools require different shapes, as can be seen in the specification of how the shaft of the drill bit is installed. Electric drivers have recently advanced to impact drivers, which need diverse shapes of the bit. The power of power tools has increased so much recently, so we have to keep improving our existing products to respond to the advanced types of power tools. We tried to reduce the friction on the edge, make it easier to remove the wood chips and increase the durability of the bits.
To achieve those, we repeated a lot of testing to ensure that each particular impact bit will work for a specific power tool. We must continually improve our products in conjunction with the advancement of power tools and electric drivers.
Our philosophy is to keep challenging advancements, and we put a lot of importance on creativity and kaizen. We produce similar products, but we are making small improvements and upgrades. We are very quality-oriented, and we develop the equipment needed for the manufacturing of new products.
Since our equipment is manufactured in-house, we were able to respond to the disruptions brought by the pandemic.
That is how we keep the unique monozukuri structure of our company. One of our key competitive advantages in this industry is the planning and development processes for our equipment every year. As the president, I always emphasize the need to have and maintain our unique technologies and equipment to manufacture our products. By doing so, our competitors cannot replicate what we do.
Many Japananese SMEs seek to collaborate with foreign companies in the US or Europe to create technologies that meet market-specific developments. Are you looking for a partner for product development in the US or Europe that can help you improve your technologies?
At this moment, we do not have plans for collaboration, but we want to stay interested in a variety of things. If we find a hint for a new opportunity, we would like to pursue it and negotiate with a potential partner.
Domestically, we are collaborating with manufacturers of machine drills to find out the most ideal drill. We conduct the testing together, and we let our salespeople and engineers visit their plants and work together. The demand for drill bits for acrylic materials substantially grew during COVID-19, so we are working with the manufacturers and are already supplying the best acrylic bits to our customers.
Star-M will be celebrating its 100-year anniversary next year and it will also be the 20th-year anniversary since the company’s establishment in the US. Moving forward, which particular countries or regions will you be focusing on to increase your international sales?
Though we have already set our footprints in the major markets of more than 30 countries, we still want to grow our market share. Our goal is to have a distributor in every country and target emerging nations that are foreseen to become a part of the advanced nations. We would like to set up a sales strategy for those countries for our further expansion.
In Japan, it is still not very common for women to be the president of a company, especially in the field of monozukuri and even more so in woodwork and tools. What have been some of the challenges that you have been facing as a woman in this industry that you have been able to turn into opportunities?
It has been less than a year since I became the fifth president, but I always give importance to our employees, which all the previous generations of presidents did for a long time. I would like to keep cherishing what my predecessors tried to protect, and also add some things during my time as president. The first-generation president used to highlight the importance of the local community and environment. Hence, they installed solar power generators at the very early stage, which we are continuing up until now. Their priorities are what we concentrate on now as well. Star-M always tries to contribute to the community.
When I talked to some retired employees recently, they said that they are hoping this company will continue to grow in such a way while taking care of the community going forward. We also want to pursue SDGs. It looks like this company has always been one step ahead in doing what we want to do in the future. Our technologies are important, but our seasoned workers can similarly achieve the same success. Together with them, I would like to make everyone happy through our business activities, by providing detailed support to enable all genders and ages to fulfil their potential.
Moving forward, we are aiming to create and contribute to a beautiful future for the global environment by utilizing our knowledge and understanding of the value of wood as a sustainable natural resource that we have cultivated for the past 100 years.
Imagine we come back on your last day as president when you are about to pass down the company to the next generation and interview you all over again. What dreams and goals would you like to have achieved for the company by then?
I would like to showcase a novel and an innovative product that greatly contributes to the community and is completely rooted in people's lives. My dream is to excitedly and proudly announce, "This is our product!"