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Case Study

Overcoming adversity through innovation – Daikin at 100 (A): Leadership lessons

By Kazuo Ichijo and Yunfei Feng

15 pages

December 2024

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Reference: IMD-7-2618

This case study examines the remarkable evolution of Daikin Industries, a company that demonstrated resilience and innovation over nearly a century. Founded in 1924 by Akira Yamada in Osaka, Japan, Daikin originally focused on manufacturing aircraft components. However, the company pivoted towards refrigeration technology in response to emerging market demands, notably during Japan’s post-World War II economic boom. By leveraging R&D in fluorocarbons and innovative cooling technologies, Daikin established itself as a leader in the air conditioning sector. The case highlights key leadership eras, notably the transformative periods under Noriyuki Inoue. Under Inoue’s stewardship, the company emphasized execution capabilities, prioritizing operational excellence alongside technological advancement. His leadership drove Daikin’s globalization strategy, enabling the company to become the second-largest fluorocarbon producer globally and the foremost player in the air conditioning market. As Daikin approaches its 100th anniversary, it faces contemporary challenges such as climate change and increasing consumer demands for energy-efficient products. The company’s commitment to innovation remains pivotal as it seeks to balance profitability with environmental responsibility. This case prompts discussion on Daikin’s strategic responses to evolving market conditions and the importance of leadership in sustaining growth.

Learning Objective

Understanding resilience in business: Analyze how Daikin’s innovative strategies and leadership transitions have enabled the company to navigate economic hardships and market volatility, thus demonstrating resilience in the face of adversity.
Evaluating strategic leadership: Explore the impact of pivotal leaders, such as Akira Yamada and Noriyuki Inoue, on Daikin’s strategic direction and organizational growth, identifying key leadership qualities that foster transformation and adaptability.
Leveraging technology and innovation: Investigate the role of technology and R&D in sustaining competitive advantage for Daikin, focusing on developments in energy-efficient systems and how innovation serves as a catalyst for growth.
Navigating contemporary challenges: Discuss the current challenges facing Daikin, such as climate change and shifting consumer preferences, and evaluate strategies that the company can employ to maintain relevance and leadership in the evolving air conditioning industry.

Keywords

Global Business, Strategy, Sustainability, Globalization, Innovation, Responsible Leadership, General Management

Settings

World/global, Japan
Daikin Industries, Consumer Goods, Home Appliances
1924-2024

Type

Published Sources

Available Languages

English

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This case study is part of a series

Overcoming adversity through innovation – Daikin at 100 (A): Leadership lessons
Overcoming adversity through innovation – Daikin at 100 (B): Sustainability lessons
Overcoming adversity through innovation – Daikin at 100 (C): China market lessons

This case study is part of a series

Overcoming adversity through innovation – Daikin at 100 (A): Leadership lessons
Overcoming adversity through innovation – Daikin at 100 (B): Sustainability lessons
Overcoming adversity through innovation – Daikin at 100 (C): China market lessons

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