Carve-outs and 'kaizen' offer a new path for Japanese companies

How Japan Inc. can use private equity for transformational success

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Media members are seen during the New Year ceremony marking the opening of trading in 2025 at the Tokyo Stock Exchange on Jan. 6. © Reuters

Shiv Shivaraman is the Asia region leader at AlixPartners. Tomoyuki Suzuki is the Asia leader of the private equity practice at the same company, based in Tokyo.

After decades of suboptimal shareholder returns, Japanese conglomerates are now facing both market and regulatory pressures to improve performance. To do so, they are considering a variety of levers, including operating model transformation, divestitures of noncore and underperforming businesses, headcount reduction and cost optimization.

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