Tokyo (SCCIJ) – Mr. Michael A. Loefflad, the new President and Representative Director of DKSH Japan, sees an enormous potential in the near and mid-term future to further develop the company’s role as a Market Expansion Services provider. He mentioned in particular the coming free trade agreement between Europe and Japan, where new services and products will find their way to Japan, and the Tokyo 2020 Olympic Games, which would offer exciting business opportunities. In an interview with the SCCIJ, Loefflad talked about the heritage of DKSH as the longest standing foreign company with uninterrupted business in Japan, the influence of Switzerland and Japan on its operating style and whether automatic translation will help foreign business people in Japan to be successful.
After almost 10 years at the helm of Wuerth Japan, you have become Representative Director and President of DKSH Japan at the beginning of October. What motivated you to change your job?
Michael A. Loefflad: DKSH, with its 152 years of history in Japan, is operating in so many business fields, from importing luxury watches, operating shops for premium stationaries, selling raw materials to the pharmaceutical and food & beverage industry to laser diagnostics, wood processing and data center equipment and many more to mention.
We have long-standing partnerships with famous international brands and clients – Faber-Castell pens, Mondaine watches, Felchlin chocolate or Vertiv IT infrastructure, just to name a few. For me, constantly widening my horizon and working in many different industries in my whole professional life is what I like – this was love at first sight. How could one resist that call?
DKSH is the leading Swiss company for Market Expansion Services with a strong focus on Asia. After having just started your new work, what priorities have you set for your first half year and what are your medium-term goals?
Michael A. Loefflad: First at all, DKSH Japan has been extremely successful over the past years and one of the first priorities is to ensure my skilled and passionate colleagues that there won’t be dramatic changes. Adjustments in the organization to further increase efficiency, making the company ready for the next 20 years, building a modern environment to face the demographic challenge in Japan, this is all on my agenda. This includes of course also further growth, looking for M&A targets, searching for the next trend. As a Market Expansion Service provider, you need to be always ahead of your time and perhaps set a trend rather than just being a “me too” firm.
Where do you see the main future challenges for the business of DKSH Japan?
Michael A. Loefflad: To further expand business and make sure that our clients have relevant market access in Japan and Asia. From trading silk to the first gas light installation in Japan to watches and chocolate, the portfolio of our clients has always drastically changed and that will be the challenge for us not only now but for as long as our company exists. Therefore, we must constantly renew ourselves, and make sure that we don’t miss the next “big thing”. Today we represent big international companies in our three Business Units Consumer Goods, Performance Materials and Technology and make sure their business in Japan continues to grow. At the same time, we have opened other Asian markets to many Japanese clients.
New DKSH Japan President and Representative Director, Mr. Michael A. Loefflad
DKSH has strong Swiss roots and is listed on the Swiss stock exchange, but is also strongly connected with Japan. Could you notice so far any “Swissness” in the way DKSH operates?
Michael A. Loefflad: You mean besides the Swiss chocolate I received as a welcome present? DKSH, as well as most Swiss companies, is very international and therefore very good in adopting the culture in the markets it is operating in. In fact, DKSH has its roots in Japan, Yokohama, to be precise. 98% of our over 30,000 employees worldwide are based in Asia. In other words: There is of course something “Swiss” in our company but a lot of “Asia”, too.
As a follow-up question, do you recognize any Japanese traits DKSH might have acquired after operating for so many decades in and from Japan?
Michael A. Loefflad: We have only very few foreign employees in Japan. Our corporate culture is therefore Japanese with a very strong international touch because most of our colleagues do represent e.g. Swiss clients and are frequently traveling to Europe for training, negotiations and exhibition purpose. In this way, they are also positively influencing our cooperation partners by showing that Japan is not just “complicated” or “obsessed with details” but very competent and professional.
Many Japanese companies have discovered Asia, in particular South and South-East Asia, as target countries for expansion. Are you also acquiring them as customers because you can offer an already established network?
Michael A. Loefflad: We are having more and more clients from Japan widening their business in the rest of Asia together with DKSH. We can rely on our strong network in South-East Asia, for instance in Thailand, Myanmar or Singapore. Among our well-known Japanese clients are healthcare companies such as Takeda, Omron or Hisamitsu, but also Kameda Seika, Suntory or Kosé.
You are the second German President in a row at DKSH Japan. Do you consider such a divergence as relevant at all in order to achieve business success?
Michael A. Loefflad: No, I do not see a relevance but if it helps: Switzerland and Germany are neighbors and I am personally from Munich and could at least see the Alps (when we had “Foen”).
You stayed in Japan after completing the EU Executive Training Program, known as ETP, and had a successful career here. Do you have any advice for young people in Switzerland interested in an executive career in Japan?
Michael A. Loefflad: I just had an interesting conversation with a young German who told me, he doesn’t need to learn Japanese because artificial intelligence will take over that task in the future. I can only say: Good luck with that approach. Language is still the key for success in Japan.
May I ask why this is the case despite automatic translation on the horizon?
Michael A. Loefflad: It’s not just the words, it’s the whole non-verbal communication you learn with the vocabulary and if you want to spend an interesting evening with your Japanese colleagues or customers without a translator, you better learn the language. And you don’t want to get your message getting “lost in translation”. At ETP, we did not only learn the language, but also the whole set for an executive manager: labor law, taxation, history, religion, culture, etc. Every week for 18 months we had a seminar about one of those topics. I regard this education as a privilege and the foundation of my development in Japan.
About Mr. Michael A. Loefflad
Michael A. Loefflad has more than 17 years of experience working in Japan. Most recently he was the Representative Director & President of Wuerth Japan Co., Ltd., based in Yokohama. He has also worked for Skidata in Japan. Both Wuerth and Skidata are leading, multinational companies headquartered in Europe. Prior to this, Loefflad worked for AOL Germany/Bertelsmann and Deutsche Telekom Group. In addition to his proven track record in leading and managing businesses in Japan, he is fluent in Japanese. Loefflad was born in Munich in 1966 and studied law at the University of Munich.
About DKSH
DKSH is the leading Market Expansion Services provider with a focus on Asia. As the term “Market Expansion Services” suggests, DKSH helps other companies and brands to grow their business in new or existing markets. Publicly listed on the SIX Swiss Exchange since 2012, DKSH is a global company headquartered in Zurich. With 780 business locations in 36 countries – 750 of them in Asia – and 30,320 specialized staff, DKSH generated net sales of CHF 10.5 billion in 2016. DKSH was founded in 1865. With strong Swiss heritage, the company has a long tradition of doing business in and with Asia and is deeply rooted in communities and businesses across Asia Pacific.
About DKSH Japan
DKSH Japan (previously known as Nihon SiberHegner) is one of the first foreign trading companies in Japan, established as Siber Brennwald in Yokohama in 1865. With uninterrupted presence in Japan for more than 150 years, the company has contributed greatly to Japan and its culture, becoming today the leading Market Expansion Services provider in Japan. DKSH Japan offers products and services in the three specialized areas of Consumer Goods, Performance Materials, and Technology.
Interview: Martin Fritz for SCCIJ; Photos: DKSH Japaneas of Consumer Goods, Performance Materials, and Technology.
