Tetsuya Sogo is the CEO of NTN Americas, a bearing manufacturer. He is working to combine Japanese and American management styles at the company to create a "learning organization." Specifically, he is merging Japan's "middle-up-down" approach that emphasizes collaboration between management levels with the U.S.'s traditional "top-down" style. Sogo believes this will allow NTN Americas to leverage the strengths of both explicit and tacit knowledge sharing. He is implementing initiatives like cross-facility meetings and training to foster interaction between managers of all levels. Sogo's goal is for the blended management approach to help NTN Americas expand its business in North and South America.

1. Tetsuya Sogo
CEO
NTN Americas
Mount
Prospect, IL
P R O F I L E M A G A Z I N E Q1/16

2. Global Values,
Local Success
At a recent internal presentation
at NTN Americas’ headquarters in
Mount Prospect, Illinois, chief ex-
ecutive officer Tetsuya Sogo stood
at a whiteboard before a crowded
room of attentive managerial per-
sonnel. With a black marker he
drew a large iceberg buffeted by
squiggly waves, the craggy tip of
the berg jutting above the water and the bulk of its swol-
len mass extending deep below the surface.
The iceberg, he explained, represented knowledge: the
tip was “explicit knowledge,” derived from data, analy-
sis, and headfirst thinking, and the hidden bulk was “tacit
knowledge,” gleaned from long-term first-hand experience
and gut-level instincts. Americans, he went on, are good at
processing explicit knowledge, and the Japanese have de-
veloped effective systems for processing tacit knowledge.
Sogo wants to combine these strengths to turn bearing
Japanese expatriate Tetsuya Sogo, CEO of NTN Americas, is creating
a “learning organization” by merging his homeland’s middle-
up-down management approach with the traditional top-down
approach of the United States
manufacturer NTN Americas into a “learning organiza-
tion” in which everyone—from upper-level managers to
those on the factory floor—can see its market goals, its
managerial initiatives, and its production capabilities, like
the iceberg, as a cohesive whole.
Sogo is uniquely qualified to speak on the differences
between the business cultures of Japan and America. Orig-
inally from Japan, he got his start with Osaka-based NTN
Corporation more than thirty years ago, just after graduat-
ing from Waseda University with a bachelor’s degree in in-
dustrial engineering in 1982. Like many Japanese workers,
he went through a rotational program and gained experi-
ence in several positions to understand different aspects
of the manufacturing process, and eventually this landed
him a post in 1989 as chief engineer of the company’s plant
in Elgin, Illinois, producing wheel bearings.
The facility had the most modern equipment, but its
production numbers didn’t match those of factories in
Japan, and Sogo saw for the first time how Japanese and
Words by G E O F F G E O R G E Photo by CAL E B F OX

3. American managerial styles can clash. The
former rewards workers for their loyalty and
for a focus on teamwork and incremental per-
fection through business philosophies such
as kaizen, which translates as “continuous
improvement.” This approach didn’t work in
the higher-turnover economy of the United
States, though, so Sogo had a discussion with
his workforce and created a new wage system
based on skill level and demonstrated perfor-
mance. Immediately, employees became more
enthusiastic about training with kaizen spir-
it, and the Elgin factory’s production num-
bers climbed. Sogo was deeply impressed by
the power of his workforce’s learning-organi-
zation thinking and realized that, to globalize
it, “the key is how to get local people—local
operators, management, executives—to get
OFF THE CLOCK WITH
TETSUYA SOGO
You wouldn’t think it while discussing
quarterly finance reports with Tetsuya
Sogo over coffee, but the chief
executive officer of NTN Americas
used to be a minor celebrity in the
world of karate. He started training
at age ten and enjoyed the practice’s
focus on repetition and steady
improvement. By the end of college,
he had become a third-rank black
belt. You can still find YouTube videos
of him online, breaking boards and
performing moves in sync with others.
These days, Sogo is too busy to
practice more than a few karate moves
for exercise. When it’s 9 a.m. in Japan,
it’s 7 p.m. in Illinois, so Sogo often
stays late to make himself available
for morning briefings with his parent
company. However, he still finds time
to get out of the office to see his
daughters, the youngest of whom is
still in high school and a competitive
badminton player.

4. the maximum power from them.”
Inspired, he decided to continue his stud-
ies at the Kellogg School of Management at
Northwestern University to expand his un-
derstanding of American business processes.
He graduated with an executive MBA in 1996
and went back to Japan to conduct strate-
gic-alliance and M&A work for the company.
Eventually, he returned to America in 2011
as executive vice president of NTN USA, the
holding company for all NTN group compa-
nies in the United States, and ultimately he
became president of NTN USA and chief exec-
utive officer of NTN Americas in 2013 to lead
the profitable expansion of NTN’s business in
North and South America.
His parent company is now the third-larg-
est bearing manufacturer in the world, and
that’s saying something. Bearings are essen-
tial for reducing friction in all things mechan-
ical, and the industry that manufactures the
small spheres and related components has
its hands in everything from aerospace tech-
nology to highly automated industrial equip-
ment to the cars we drive. NTN Corporation’s
total net sales revenue was ¥702 billion in
2014, and the Americas region accounted for
more than a quarter of that, with most of its
revenue coming from the automotive original
equipment manufacturer (OEM) market. NTN
Americas wants to grab more of the automo-
tive aftermarket (parts sold through retailers
and dealerships) as well as greater segments
of the industrial OEM market and aftermar-
ket. And Sogo has the plan to achieve this: “By
utilizing the same motivational principles as
I have previously,” he says. “I want to inspire
the NTN Americas’s management team by
growing their minds and spirit.”
Most Japanese leaders are lifelong
members of a single company, and this
loyalty is valued, according to Sogo. Many
Japanese college students will actually join
the same company together and stay in
touch over the years, even as they take on
different roles at a company’s different levels
and locations. They will often communicate
or go out after work, and the knowledge
they share with one another over time will
give them a better overall understanding of
their organization and its inner workings.
This close relationship between middle
managers is the basis of the middle-up-
down management approach that Sogo is
implementing across NTN Americas.
The typical American managerial style,
by contrast, rewards sharp decision making
based on available information. According
to Sogo, it’s a traditional top-down approach
that sometimes entails less interaction be-
tween a company’s different levels, where
strategic matters in key areas get sorted out
quickly and decisively when an initiative is
handed down.
Good strategic positioning is what will
help NTN Americas expand further into the
profitable industrial OEM market and the
automotive and industrial aftermarkets,
Sogo says. But, rather than simply embrace
top-down management to get this position-
ing done, he wants to merge it with Japan’s
middle-up-down management style. One of
the ways to achieve this is by establishing the
tools to support a learning organization. In
addition to conducting town-hall meetings
at each NTN facility in the Americas region,
Sogo is bringing the executives and middle
managers of each facility together for corpo-
rate meetings and occasional training sem-
inars. This is fostering interaction between
the managers—and between their various
departments and different facilities—at all
levels and pushing them to learn from each
other’s slightly different approaches. “The
important thing is to get together and get to
know each other, have drinks together,” Sogo
says. “That is how I’m trying to achieve that
middle-up-down management.”
Ultimately, Sogo believes that melding
the Japanese and American management
styles and putting people in the position to
learn and use both styles effectively will be
the recipe for greater success. “The Japanese
middle-up-down management style will help
NTN continuously improve and maintain our
competitive advantage in the areas of quality,
cost, and engineering superiority, specifically
in the OEM market,” he says. “The American
top-down management style will serve NTN
very effectively at helping us make quick deci-
sions and react effectively to the faster-paced
industrial and automotive aftermarkets.”
“I admire the approach
Tetsuya Sogo is taking
in integrating the
cultural diversity of his
organization. Too often
people think ‘culture
blindness’ is the most
enlightened state of
cultural sensitivity.
But Tetsuya Sogo
is using cultural
awareness to leverage
strength from both
the Japanese style of
processing knowledge
and the American
style, to build a
collectively stronger
and more enlightened
organization.”
Ed Wise, guest editor

5. We see less downtime
in your future.
At NTN, we are dedicated to help you get
the most out of your rotating machinery.
Our people contribute to this vision every day.
Invite us to roll up our sleeves with you. Learn
more at www.ntnamericas.com. REVOLUTION IN MOTIONTM