He may be staring down the barrel of huge losses for the past year, but Panasonic boss Kazuhiro Tsuga (left) is determined to turn the company around, however painful the measures required may be.
And it seems the savings start close to home: the company has just announced both Tsuga and incoming chairman Shusaku Nagae will have their salaries cut by 60%.
Tsuga restated his commitment in his most recent interview with the Japanese financial press, saying that 'For the past year, I've tried to manage the company in my own style. I'll follow through on my decisions no matter what.'
Some of that 'no matter what' was laid out in his New Midterm Management Plan, aimed at avoiding the kind of loss the company made last year – ¥772bn (£5.4bn) – and the ¥750bn+ of red ink it's expected to have when figures are released for the financial year just ended.
TV's still the problem
A major player in those losses is the company's flat-panel TV business, the interview in The Nikkei noting that ¥600bn (just over £4bn) has been invested in plasma technology over the years without yielding the results the company has been expecting.
Tsuga has already wielded the axe at Panasonic's corporate HQ, cutting the staffing from 7000 to just 130, and reinstated the company's old structure based on product categories rather than one rooted in business functions across product types, such as production and sales.
The company is not expected to pay a dividend to its shareholders this year – the first time it will have failed to do so in 63 years, but Tsuga expects earnings to pick up, and that 'we will surely resume dividend payments this fiscal year.'
Other executives will have their salaries cut by 30%, in a move expected to save the company tens of billions of yen, and negotiations are also underway with Panasonic's labour union to extend working hours for all employees without any extra remuneration.
And what of the Midterm Management Plan, which has been criticised in some quarters for being big on ambition but light on detail? Tsuga says more detail will be given following the company's 2012-13 earnings announcement, due on May 10th.
