2005年度（2005.4～2006.3）　ワークショップ講演

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Record of Workshop/Lecture No.11

Date: June 23, 2005
Lecturer: Masahiro Shindo, Chairman of MegaChips Corporation
Theme: “An entrepreneur is a sort of artist.”
- Evolution of MegaChips Corporation and its management principles
Recorded by: Mitsuo Hatakeyama and Juichi Koyama

1. Biography of Mr. Masahiro Shindo
(MegaChips Corporation: http://www.megachips.co.jp)
Graduate of the Department of Industrial Chemistry, Faculty of Engineering, Ehime University. After working for Mitsubishi Electric Corporation and Ricoh Company, Ltd., he founded MegaChips Corporation in 1990 and Visual Communications Inc. (Megafusion Corporation) in 1998. He developed both of them into listed enterprises.
Since 2003, he has been a professor of the Graduate School for Creative Cities, Osaka City University, teaching such courses as “Startup and Entrepreneurial Philosophy” and “Management of Organization.”

2. Summary of the lecture
● Inauguration of MegaChips Corporation
While he was involved in the production of semi-conductors as a business operations leader both at Mitsubishi Electric Corporation and Ricoh Company, Ltd., Mr. Shindo began to have doubts about ideas such as “dependence on DRAM,” “emphasis on productivity,” and “big firm suprematism” that were then prevalent in the Japanese electronics industry. Firmly believing that the time of system LSI would soon arrive, Mr. Shindo advocated this idea to Ricoh, his company at the time. However, his suggestion was not accepted, and he ended up leaving Ricoh. That was the starting point of MegaChips Corporation, Japan’s first R&D-focused fabless high-tech venture company. (according to IT dictionary, fabless means a company that outsources its production completely to external manufacturers so that it needs no facilities for manufacturing)

● Consensus on company’s management principles overcame the operational crisis
In the early days of the MegaChips Corporation, even opening a bank account was a struggle, and Mr. Shindo’s office moved from one community centre to another. Gradually the number of entrusted development projects increased, and the company seemed to get set on a path to growth. At that moment, the company was directly impacted by the bursting of the so-called “bubble economy.” In addition, a hostile takeover attempt from his former employer raised tensions among his employees and divided them into two groups. One group was in favor of accepting the funds offered by the company making the bid, and the other group favored maintaining MegaChips’ independent operation.
Mr. Shindo and all his employees gathered in a hotel at Arima Spa to discuss and decide what to do. After a long-hour consideration and discussion, they put together the company’s “management philosophy” and “action guidelines (management creed)” in clearly-stated documents, setting down final “management principles” - these were “to develop the company’s business independently, with the goals of both the development of the company and the well-being of the employees.” As a result, although a few people left the company, all the remaining employees shared the same values, which served as the driving force for getting through the crisis.

● Basic management style
　 Taking a page out of the books of Sillicon Valley venture enterprises, the company concentrates its management resources on R&D of LSIs tailored to individual users (algorithm development, architecture development, and circuit design), and outsources its production. MegaChip’s management style is based on this “selection and concentration” business model, which is why the company stays competitive.
　 Financially, the company adopts “defensive management”, or no-debt, cash-flow management, without depending on external loans or investments.
　 To cope with the so-called “big firm disease” that tends to develop when company management becomes stable, the company reorganised its business groups with MegaChips Corporation as the holding company, which helped it to solve its outstanding problems. With this “renewed image of MegaChips”, the company is in the process of setting itself on a new growth path.
　 Mr. Shindo, the entrepreneur himself, decided to shift from being the sole owner to being a stockholder, and resigned from all his former positions. As the company’s founder, he is now observing its growth.

Mr. Shindo, enthusiastically speaking about his passion

● Impressions of the lecture (by the recorder)
“Even if everybody else does good, dare to do ill. It’s true to everything in the world.” These words of Ryoma Sakamoto, whom Mr. Shindo respects, are reflected in the way of life of the man who established and reared MegaChips Corporation. The real power of Mr Shindo’s management style lies in his strong belief in doing what he thinks is right, and his having the tenacity to achieve it. We are very lucky to have Mr. Shindo, who has been praised as a preeminent entrepreneur, with us on campus.

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