Mitsubishi Motors Corporation will revise its organisation from June 29, slimming down from 230 departments to 131, speeding up the decision-making process and clarifying responsibilities.
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The new organisation will include a number of changes geared towards restoring consumer trust in MMC and pushing through restructuring initiatives outlined in the company’s business revitalisation plan.
MMC has been rocked recently by revelations it systematically concealed product defects from government regulators for about two decades, avoiding costly recalls. This has allegedly led to several deaths in Japan. A former head of the company has been arrested and both his home and MMC offices raided by police looking for evidence.
Restoring trust, implementing reform
A business ethics committee consisting mainly of experts from outside the company will be established to supervise the company’s efforts to comply with its pledge to place utmost importance on customers, safety, and quality. The committee will also directly advise the board of directors, dramatically strengthening quality and governance auditing.
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By GlobalDataA new quality affairs office will handle all issues related to quality assurance and management, while the corporate social responsibility (CSR) promotion office will be established directly under the CEO to promote quality auditing and compliance issues throughout the company. The CSR promotion office will also monitor quality management and make improvements.
To carry out the reforms outlined in the company’s business revitalisation plan, a corporate restructuring committee headed by a corporate restructuring officer appointed from among outside investors will be set up directly under the CEO for one year and cross-functional teams created for all issues related to the revitalisation plan.
The teams will reach through the entire organisation and make proposals to the corporate restructuring committee. The committee will present implementation plans to those in charge of operations and promote awareness of reform issues by directly involving employees. A secretariat will also be set up to support the committee and cross-functional teams.
Organisations directly under CEO and COO
In the new corporate organisation, the CEO will supervise departments related to overall management of the group, while the COO will supervise departments involved in executing business operations. Newly established organisations reporting directly to the CEO include the CSR promotion office, finance group headquarters, group corporate strategy office, and the secretariat of the corporate restructuring committee.
Newly established organisations reporting directly to the COO include the quality affairs office, corporate staff office, product operations group headquarters, domestic operations group headquarters, overseas group headquarters, and the production and logistics office. The global aftersales office will also report to the COO.
CSR promotion office
The CSR promotion office will be set up to keep watch on the company’s stance towards customers and compliance issues, and take the lead in implementing necessary improvements. Based on information from customers, corporate audits and whistle blowers, the office will report to top management, propose and follow up on countermeasures, and propose and follow up on new measures to improve corporate culture. The office will also include enhanced functions for corporate auditing and the business ethics committee.
Finance group headquarters
The organisation of the finance group headquarters will be kept simple to speed up the decision-making process and clarify responsibility. The current controlling and accounting departments will be reorganised into the group controlling and accounting department, overseas operations controlling and accounting department, domestic operations controlling and accounting department, and product controlling and accounting department. The corporate finance and financial service block will be merged into the financial department.
Group corporate strategy office
Currently, the group corporate strategy office is in charge of setting out management strategy while the product planning and programme management office is responsible for product strategy. Both of these functions will be consolidated into the new group corporate strategy office.
Quality affairs office
Quality assurance and quality management functions — currently divided among four departments — will come under the control of the quality affairs office to ensure prompt cross-functional information exchange, clarify responsibilities, expedite quality improvement measures, and improve development and production quality. The quality affairs office will also have a safety quality auditor function.
The company will beef up the office’s ability to conduct quality audits and assure the quality of newly purchased items during the product development and production stages. Responsibility for the final delivery of products will also be clarified. Personnel working on market measures at manufacturing plants, purchasing, and the quality engineering centre will be integrated into the quality affairs office, speeding up the implementation of market measures.
The CSR promotion office will monitor the quality management operations of the quality affairs office and make improvements where necessary.
Corporate staff office
To speed up the decision-making process and clarify responsibilities, the functions of the current corporate affairs office, human resources office, and global it office will come under the umbrella of the corporate staff office.
Product operations group headquarters
The product operations group headquarters will be built to deliver quick results in terms of cost savings and developing products to put the company back on track to growth as outlined in the business revitalisation plan. The leaner set up — with fewer departments and less layers — will allow policies set out by senior management to easily filter through the organisation.
A product development office, development engineering centre, and global procurement office will be newly established within the product operations group headquarters, while the product design office will also be transferred there and renamed design centre.
Production and logistics office
Current production and production management departments, such as production control and logistics, will be merged to bring production and logistics functions closer together. All production plants will also come under the control of the production and logistics office.
Global aftersales office
To maintain consistency in aftersales operations, the global aftersales office will be responsible for all development and logistics issues related to parts and accessories.
Domestic operations group headquarters
The current domestic sales and marketing headquarters will be renamed domestic sales office and transferred to the domestic operations group headquarters. The areas of responsibility of the domestic sales office will be reorganised to achieve a simpler organisation with a quicker decision-making process.
A business planning department will be established within the domestic operations group headquarters to clarify responsibility of financial results for domestic operations.
Overseas operations group headquarters
A North America office, Europe office, North Asia office, and ASEAN office will be established in the overseas operations group headquarters to clarify the responsibilities for profit and loss in each regional business and speed up the decision-making process.
MMC will also enhance its sales support for overseas markets by bringing related functions under the direct control of the overseas operations group headquarters. The new organisation will also allow the company to remain up to date on potential risks to its overseas operations.
In addition to the different market offices, the export operations department, overseas product marketing department, and overseas sales promotion department will be placed directly under the overseas operations group headquarters.
