Miyazaki - Asahi Kasei has grown from its roots in Nobeoka, Miyazaki Prefecture, into a global conglomerate with annual sales exceeding 3 trillion yen by repeatedly developing products and technologies that dominate their markets or occupy niches with few direct rivals.
The company operates across three main business areas: materials, housing and health care. Its businesses range from household products such as Saran Wrap and Ziploc to lithium-ion battery materials, Hebel Haus homes, condominiums, pharmaceuticals and medical devices.
Asahi Kasei also supplies Bemberg fiber used in some women's products in Uniqlo's popular Airism range and has developed Velvet Sound, an audio system based on proprietary semiconductor technology.
President Koshiro Kudo, 67, who was born and raised in Nobeoka and took the top post in 2022, has emphasized a strategy of identifying businesses where the company can establish a clear competitive advantage.
"We should aim to be overwhelmingly No. 1, including in recognition, while being one of a kind is also something that strongly demonstrates what makes Asahi Kasei distinctive," Kudo said.
The approach helped the company recover after a period of weak performance, with management focusing resources on businesses where Asahi Kasei believes it has a credible path to leadership.
One of its best-known products is Saran Wrap, which has remained a household staple in Japan for decades.
Kudo said the product's strength has come from continual improvements based on consumer feedback, including efforts to make the wrap easier to cut and prevent it from sticking to itself.
He said such seemingly small refinements, accumulated over many years, have contributed significantly to the product's reputation.
Asahi Kasei's materials business also includes separators for lithium-ion batteries, a critical component used in batteries circulating around the world.
Kudo said development in such fields can require years of persistence before technology reaches the point where it becomes commercially successful.
"It is important to keep working patiently through periods when development does not go well, until eventually it suddenly begins to blossom," he said.
Housing forms the company's second major pillar.
Asahi Kasei's housing business began with Hebel Haus and has since expanded into condominiums, an area Kudo said has developed a strong reputation and offers significant growth potential.
Health care is the third pillar, covering pharmaceuticals, automated external defibrillators and other medical businesses.
Kudo said the challenge across all three sectors is that Asahi Kasei often competes against companies specializing exclusively in a single field.
That means the conglomerate must find ways to compete through distinctive products, technologies and business models rather than relying simply on scale.
According to Kudo, many of Asahi Kasei's strongest businesses are built around products rarely found elsewhere in the world or around unusually structured business models.
The company also seeks markets that fall between the areas typically pursued by major corporations and startups.
Some opportunities, Kudo said, may be too small to attract the largest companies but too large for venture businesses to tackle easily.
He said Asahi Kasei constantly considers how to turn that middle ground into businesses that reflect the company's particular strengths.
Managing such a wide portfolio also creates limitations on how much money and personnel can be assigned to individual businesses.
Kudo describes those limits as "constraints" inherent in conglomerate management.
Because resources are finite, the company must decide carefully where to concentrate investment and personnel.
Kudo said those constraints can themselves encourage innovation by forcing managers and engineers to think harder, develop ideas and find more efficient ways to compete.
"The fact that there are constraints is precisely what creates ingenuity," he said.
That philosophy also underpins Asahi Kasei's emphasis on remaining either No. 1 or one of a kind.
Kudo said leadership in any market is temporary because competitors and new business models inevitably emerge.
A company must therefore continue searching for new businesses and technologies while reshaping its portfolio rather than assuming an existing advantage will last indefinitely.
He said the effort to continually identify new opportunities is what ultimately produces distinctive technologies and market-leading products.
One example is Bemberg, Asahi Kasei's proprietary brand of cupro fiber used in clothing around the world.
The material has long been used in some women's items in Uniqlo's Airism series, one of the retailer's flagship product lines alongside fleece and Heattech.
Bemberg is made not from ordinary cotton fiber but from the extremely fine fuzz surrounding cotton seeds, known as cotton linter.
Asahi Kasei says it is now the only company in the world producing Bemberg fiber from cotton linter.
The fiber was originally developed in Germany in the late 19th century in an effort to create a fabric with silk-like qualities.
Asahi Kasei founder Shitagau Noguchi later introduced the manufacturing technology to Japan, and the company succeeded in commercializing the material in 1931.
Production required advanced technology and offered poor profitability, however, prompting many other manufacturers to withdraw from the business.
Asahi Kasei continued refining the technology and eventually became the world's sole producer of Bemberg.
The fiber is known for its smooth texture, which comes from the softness of the fine cotton linter used as its raw material.
Its low-friction surface has made it especially suitable for clothing that needs to feel smooth against the skin.
Bemberg is now used around the world, including in traditional Indian saris and as lining material for high-end suits.
For Asahi Kasei, the nearly century-long development of Bemberg exemplifies the strategy Kudo is seeking to apply across the group: persist with difficult technologies, concentrate resources where the company can differentiate itself, and continue searching for businesses capable of becoming either No. 1 or one of a kind.
