Sharp Corporation

22–22, Nagaike-cho
Abeno-ku
Osaka 545
Japan
(06) 621–1221

Public Company
Incorporated: 1935 as Hayakawa Metal Industrial Laboratory
Employees: 60,000
Sales: ¥992.67 billion (US$7.94 billion)
Stock Index: Tokyo Osaka Nagoya Paris Luxembourg Zurich Basel Geneva

The Sharp Corporation is one of the largest and oldest Japanese consumer goods manufacturers. Founded on a business creed reminiscent of the ancient trading houses—“Sincerity and Creativity”—and built largely on the hard work and determination of one man, Sharp is in many ways Japan’s most “traditional” modern electronics manufacturer. Despite its decidedly Japanese character, Sharp remains an outward-looking, international corporation, as dedicated in each of its foreign markets to assimilation as to success.

The company was founded as a small metal works in Osaka in 1912 by an inventor and tinkerer named Tokuji Hayakawa. After three years in business, earning a modest income from gadgets and repair jobs, Hayakawa engineered a mechanical pencil he called the “Ever-Sharp.” Consisting of a retractable graphite lead in a metal rod, the Ever-Sharp pencil won patents in Japan, and even the United States. Demand for this simple and durable instrument was immense. To facilitate greater production, Hayakawa first adopted an assembly line and later moved to a larger factory.

Hayakawa’s business, as well as his life, were ruined on September 1, 1923. On that day, the Great Kanto Earthquake caused a fire which destroyed his factory and took the lives of his wife and children. Hayakawa endured severe depression; it was a year before he re-established his factory. The Hayakawa Metal Industrial Laboratory, as the company was called, resumed production of the Ever-Sharp pencil, but Hayakawa became interested in manufacturing a new product: radios.

The first crystal radio sets were imported into Japan from the United States in the early 1920s. Hearing one for the first time, Hayakama immediately became convinced of its potential. With little understanding of radios, or even electricity, he set out to develop Japan’s first domestically-produced crystal radio. After only three months of study and experimentation, Hayakawa succeeded in receiving a signal from the broadcasting service which had begun programming—to a very small audience—only a few months before, in 1925.

The radio entered mass production shortly afterward, and sold so well that facilities had to be expanded. Crystal radios, however, are passive receivers whose range is limited. Hayakawa felt that powered radios, capable of amplifying signals, should be the subject of further development. While competitors continued to develop better crystal sets, Hayakawa began work on an AC vacuum tube model. When the company introduced a commercial model, the Sharp Dyne, in 1929, Sharp was firmly established as Japan’s leading radio manufacturer. The company expanded greatly in the following years, necessitating its reorganization into a corporation in 1935.

The laboratory, for all its success, was not a leader in a wide range of technologies; it led only in a narrow section of the market. In addition, the company did not have the benefit of financial backing from the zaibatsu conglomerates or the government. It was, in the realm of the national modernization effort, an outsider. This may have been its saving grace, however, as the government had become dominated by a group of right-wing imperialists within the military. Whatever their political opinions, the leaders of Japan’s largest corporations were compelled to cooperate with the militarists in their quest to establish Japanese supremacy in Asia. Hayakawa, on the other hand, was for the most part left alone.

During World War II, Hayakawa and his company were forced to produce devices for the military, and even to restructure, as new industrial laws intended to concentrate industrial capacity were passed. Renamed Hayakawa Electrical Industries in 1942, the company emerged from the war damaged but not destroyed. While other industrialists were purged from public life for their support of the militarists, Hayakawa was permitted to remain in business. His biggest concerns were rebuilding his company and surviving Japan’s postwar recession.

By 1950 more than 80 of Hayakawa’s competitors were bankrupt. But Hayakawa’s officials personally guaranteed the company’s liabilities when the company suffered a critical drop in sales, and Hayakawa Electric was able to obtain the cooperation of major underwriters until the first major expansion in the Japanese economy occurred in 1952.

Hayakawa considered television, a field that had not yet proved commercially successful, a highly promising new area. The company began development of an experimental TV set in 1951, even before plans had been made to begin broadcasting in Japan. Two years later, when television broadcasting started, Hayakawa Electric introduced its first commercial television set under the brand name “Sharp,” in honor of the pencil. Hayakawa’s good timing was essential in allowing the company to establish and maintain a significant and profitable market share.

The company started development of a color television in the mid-1950s. In 1960, with the advent of color broadcasting in Japan, Hayakawa introduced a line of color sets. This was followed in 1962 by a commercial microwave oven, and in 1964 by a desk-top calculator. The Compet calculator, which looked like an adding machine, was the first in the world to use transistors. In 1966 the microwave oven received a rotating plate and calculators shrank with the use of integrated circuits.

Hayakawa recognized the great sales potential of the United States; a sales subsidiary was established in 1962. It served the dual purpose of facilitating sales and observing the market. By the late 1960s, the Sharp brand name had become well-established in North America. Sales in the United States provided the company with a large and increasing portion of its income. In addition, subsidiaries were established in West Germany in 1968 and Britain in 1969.

Hayakawa Electric made two major breakthroughs in 1969. That year the company introduced the Extra Large Scale Integration calculator, a device now reduced to the size of a paperback book. The other new product was the gallium arsenide light-emitting diode (LED)—in effect, a tiny computer light. Like the radio and television before them, improved versions of both the calculator and LED were subsequently introduced in future years.

Tokuji Hayakawa retired from the day-to-day operations of his company in 1970, assuming the title of chairman. He was replaced as president by Akira Saeki, a former executive director. Saeki oversaw an important reorganization of the company intended to establish a new corporate identity and unify product development efforts. That year, Hayakawa Electric Industries also adopted its new name: Sharp Corporation.

Saeki, who witnessed the Apollo moon landing while in America, decided that the company’s future efforts should center on the development of semiconductors, the electronic components which had made the lunar mission possible. He initiated construction of a massive research complex called the Advanced Development and Planning Center. The project was a significant investment for Sharp, since its budget was already seriously strained by the construction of an exhibit for Expo ’70. Nevertheless construction was begun on a 55-acre research complex in Tenri, Nara Prefecture.

During the 1970s, Sharp consolidated its position in consumer goods by broadening its product line to include refrigerators, washers, portable stereos, copiers, desk-top computers, video equipment, and “Walkman”-type headsets. Profit generated from consumer goods sales was largely invested in the Tenri facility. When completed, the research complex cost ¥7.5 billion, representing about 70% of Sharp’s capitalization.

Perhaps the most important product to come out of the Tenri research facility was the Very Large Scale Integration (VLSI) factory automation system. Building upon existing integration technologies, VLSI production lines enabled manufacturers to reduce defects and raise productivity through the use of industrial robots and other mechanical apparatus.

In an effort to head off impending protectionist trade legislation, Sharp built new factories in its largest overseas markets, principally the United States. The company’s decision to build a plant in Memphis, Tennessee was criticized at first. RCA had closed a plant in Memphis in 1966, favoring production in Taiwan. Sharp maintained that RCA had merely suffered from inept management and went ahead with the plant. By pushing its American suppliers for parts with zero defects and incorporating the Japanese concept of full worker involvement, the Memphis plant proved highly successful.

President Saeki retired in 1986, continuing to serve the company as an advisor. He was succeeded by Haruo Tsuji, a “numbers man” with an exemplary record in middle and upper management.

Sharp operates 12 research laboratories and 34 plants in 27 countries. Its employees are equally divided between Japan and foreign countries. Through its 18 divisions, Sharp has diversified into a wide range of consumer products and established itself as an originator of new industrial technologies. Indeed, Sharp has placed great emphasis on the development of artificial intelligence. In consumer electronics and appliances, the company has engaged in a measured effort to move upmarket, offering more expensive, but higher-quality, products. On this strong base, Sharp is in an excellent position to maintain its current place as a major force in world electronics for many years.

Principal Subsidiaries:

Sharp Electronics Corporation (United States); Sharp Manufacturing Company of America; Sharp Microelectronics Technology Inc. (United States); Hycom Inc. (United States); Sharp Electronics of Canada Ltd.; Sharp Electronics (Europe) GmbH (West Germany); Sharp Electronics (Svenska) AB (Sweden); Sharp Electronics (U.K.) Ltd.; Sharp Precision Manufacturing (U.K.) Ltd.; Sharp Electronics GmbH (Austria); Sharp Electronics (Schweiz) AG (Switzerland); Sharp Electronica Espana (S.A.); Sharp Corporation of Australia Pty. Ltd.; Sharp Manufacturing France S.A.; Sharp-Roxy Sales (Singapore) Pte. Ltd.; Sharp Electronics (Singapore) Pte. Ltd.; Sharp Electronics (Taiwan) Company Ltd.; Sharp Appliances (Thailand) Ltd.; Sharp-Roxy (Hong Kong) Ltd.