STRATEGY Evolving Integrated Group Management
In April 2022, the Air Water Group transitioned to unit-based management by integrating organizations of AIR WATER INC. and the group companies. Moving on, we intend to elevate this unit management into a group management structure that integrates the Air Water and those group companies playing core roles in each business area, thereby we will optimize group management resources and promote autonomous growth of each group company.
Each autonomous growth drives the entire growth
Since 2000, we have brought in more than 245 companies from diverse backgrounds through M&As, and have managed the Group respecting the uniqueness of each company’s business.
Now seeing a diverse range of business and revenue of 1 trillion yen, it is no exaggeration to say that the autonomous growth of each group company drives the growth of the entire Group.
Out of FY2022 results, % of 23 core companies
(operating profit of ¥1B or more)
Formed the “core companies” through reorganization
To encourage autonomous growth of group companies, it is important to have each company increase its presence in the industry and to reach a certain size to facilitate strategic capital investment, M&As, and alliances with other companies.
Therefore, we have defined companies with annual operating profit exceeding 1 billion yen as “core companies”, and have integrated and reorganized group companies to form core companies in each business area.
Major consolidations and reorganizations
| Timeline | Business areas | Core companies created |
|---|---|---|
| Oct. 2020 | Regional business companies | Air Water Hokkaido Inc. Air Water East Japan Inc. Air Water West Japan Inc. |
| Oct. 2021 | Functional chemicals | Air Water Performance Chemical Inc. |
| Processed food | Air Water Agri & Foods Co., Ltd. | |
| Apr. 2023 | Industrial gases, specialty chemicals Semiconductors equipment | Air Water Electronics Inc. Air Water Mechatronics Inc. |
| LP gas (Hokkaido) | Air Water Life Solution Inc. | |
| July 2023 | Medical equip., care products | AIR WATER MEDICAL INC. |
| Oct. 2023 | Aerosol, needles | AIR WATER REALIZE INC. |
Introduction of the Unit System
While focusing on the autonomous growth of group companies, we are working to build a management structure that allows us to leverage the collective strengths of the group by creating synergies among various businesses, human resources, and technologies, which are our management resources. As a key strategy for it, we have integrated and reorganized our diverse business domains into four business groups under the two growth axes of “Global Environment” and “Wellness” in April 2022, and also introduced the new “Unit System.” For details on the purpose of the Unit System, please refer to CEO Message.
(As of October 2023)
*1 Out of the 13 unites, leaders of 7 unites are from M&A companies, and these unit leaders are also appointed as presidents of Group companies that are affiliate core companies (part of them have experience as presidents).
*2 Prior to intorduction of the Unit System, organizations that group transvertially promote technology development, engineering, function and digital transfromation promotion of gas products, and logistics renovation are established.
Innovating the head office administration and
mobilizing group-wide human resources
Another future challenge for our group management is to highly standardize the management of group companies by the headquarters administration and to increase the mobility of human resources. The common application of advanced management is essential to optimize the allocation of management resources and to promote business growth in each company. In addition, mobilizing human resources within the Group and fostering the next-generation management are also an urgent issue, given the concern about the lack of successors to management personnel at group companies.
*Administrative office of AIR WATER INC.
Integrated group management by the core companies
Of the 142 consolidated subsidiaries as of March 31, 2023, there are currently 23 core companies with operating income of 1 billion yen or more. We plan to increase the number to about 30 companies through further integration and reorganization.
While based on the Unit System and keeping the originality of their operations, we will manage both the headquarters and core companies in an integrated manner as to the key management resources (human resources, funds, and technology) and the common infrastructure that supports the growth of core companies (BS management, digital transformation, and logistics). Thereby we will be realizing our growth strategies, including the total optimization of group management resources.
