Reengineering & Restructuring at Canon
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Case Code: BSTR091 Case Length: 19 Pages Period: 1990 - 2003 Pub Date: 2004 Teaching Note: Available |
Price: Rs.500 Organization: Canon Inc Industry: Office Equipment, Countries : Japan Themes: Corporate Restructuring |
Abstract Case Intro 1 Case Intro 2 Excerpts
Background Note
The history of Canon dates back to 1933, when Saburo Uchida (Uchida) and Goro Yoshida (Yoshida) established Precision Optical Instruments Laboratory (POIL), at Roppongi, in the Azabu district of Tokyo. The lab was started to develop a camera to compete with the German Leica model C.
In 1934, POIL introduced 'Kwanon', Japan's first 35mm camera with a focal plane shutter. Priced at ¥195, Kwanon had a considerable price advantage over the Leica which was selling at ¥500. In 1935, POIL launched 'Hansa Canon', a 35mm focal plane-shutter camera and in the same year it also applied for 'Canon' as its trademark. In 1937, POIL was incorporated as a joint stock company under the name Precision Optical Industry, Co., Ltd (Precision), with a capital of ¥1 million. During the late 1930s, the company also started manufacturing accessories such as enlargers, filters, and special tanks for developers. In 1939, Precision began making camera lenses, and in 1940 production of X-ray cameras commenced.
n 1942, Takeshi Mitarai (Mitarai) an auditor with the company became Precision's first president. In 1945, Precision commenced production of midrange JII focal-plane shutter cameras, and, in the following year, it opened the Ginza camera service station. In 1947, Precision changed its name to Canon Camera Co (Canon Camera). In 1949, the company's shares were listed on the Tokyo Stock Exchange, and it established a chemical division to provide solutions to problems related to camera materials. In the early 1950s, Canon Camera set up manufacturing plants at Shimomaruko, Ohta-ku in Tokyo district. It also forged alliances with research laboratories to develop new products. In 1954, the company along with NHK Science and Technical Research Laboratories, developed television cameras. In the mid-1950s, Canon Camera started setting up branches abroad. In 1955, it established an office in New York (USA). In 1957, Canon Europa the sole distributor in Europe was established in Geneva (Switzerland).
During the same period, the company acquired Chichibu Eikosha Co., (optical components supplier) to establish Canon Electronics Inc. In 1958, Canon's chemical division was reorganized as a research division and the company started focusing on optical fibers and fixed lasers. In 1959, Canon Camera entered the micrographics market through a tie-up with a US-based company Documat Inc. In the same year, it entered the magnetic heads market and the Synchroreader8 - Canon's first audio visual product was launched. In 1961, it introduced Canonet - a 35mm camera with automatic exposure mechanism. Canonet was a highly successful product with one million units being sold in less than two years. In 1962, the company formulated its first five-year plan with an aim to enter the business machines market and expand its research activities. In the same year, the company established a product development section. In July 1963, it produced a prototype of the 10-key calculator, but the management was not keen on commercializing the product due to doubts about its success......
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