Zentaku Kogyo Company: Less Is More

Contrary to the typical practice of cutting operating expenses by compromising on employees’ benefits, the chairman of Zentaku Kogyo Company Ltd. (Zentaku), David Wu Chongrang, aimed to improve the standard of living of his staff by steadily raising their salaries and benefits. In fact, the key performance indicator David had set for himself was to raise his employees’ salaries regularly to a preset target benchmark. Contrary to conventional approaches, over the past sixteen years (2006–2022) David had reduced Zentaku’s revenue by 28 per cent and the number of employees by two-thirds, while raising the annual gross profit per employee to 239 per cent. Zentaku had achieved more with less by transforming itself through the rigorous implementation of lean production, inspired by the famed Toyota Production System, but Zentaku’s future leadership now faced challenges in sustaining the success Zentaku had achieved. Were the management methods adopted in the past applicable to the younger generation of workers? How could the current management pass the enterprise to the younger generation while ensuring employees remained fulfilled in the workplace?