Hitachi, Ltd. · TSE:6501
Hitachi — Investor Day (June 2011)
35 slides from Hitachi's investor day presentation, Jun 16, 2011
Slide 1: Information & Telecommunication Systems Business Strategy
Information & Telecommunication Systems Business Strategy Hitachi IR Day 2011 June 16, 2011 Shinjiro Iwata Senior Vice President and Executive Officer President & CEO Information & Telecommunication Systems Company Hitachi, Ltd. © Hitachi, Ltd. 2011. All rights reserved.
Slide 2: Contents
Information & Telecommunication Systems Business Strategy Contents 1. Business Overview and Outlook 2. Growth Strategy 3. Strengthening Business Bases 4. Contribution towards Japan’s Recovery 5. Conclusion © Hitachi, Ltd. 2011. All rights reserved.
Slide 3: 1-1 Business Fields
1-1 Business Fields Provide highly reliable social infrastructure systems Collaborative creation with customers based on quality and trust Services IT services Data center Consulting System solutions Platforms Large-scale systems Servers/Storage/Networks Highly reliable systems Hardware Software Hig
Slide 4: 1-2 Business Overview
1-2 Business Overview Management vision: Contribute to Social Innovation Business through collaborative creation with customers Business size FY2010 revenues: ¥1,652.0 billion Revenue breakdown Software Hardware Services (Incl. System solutions) 32% 10% 58% Financial institutions Government Industry
Slide 5: 1-3 FY2010 Results and FY2011 Forecasts: Revenues
1-3 FY2010 Results and FY2011 Forecasts (1) Revenues Revenues (Billion yen) FY2010 Summary Hardware/software Revenues declined reflecting Services impact of reduced IT investment in 1,705.5 1,652.0 1,700.0 1,750.0 Japan, although storage solutions saw sales growth overseas. Outlook from FY2011 Servi
Slide 6: 1-4 FY2010 Results and FY2011 Forecasts: Operating Income
1-4 FY2010 Results and FY2011 Forecasts (2) Operating Income Operating Income (Billion yen) FY2010 Summary (Operating income ratio) Operating income rose due to 6.5% 7.0% 5.5% 6.0% better project management and cost cutting, etc., despite the impact of the Great East Japan 122.0 Earthquake. 110.0 94
Slide 7: Contents
Information & Telecommunication Systems Business Strategy Contents 1. Business Overview and Outlook 2. Growth Strategy 3. Strengthening Business Bases 4. Contribution towards Japan’s Recovery 5. Conclusion © Hitachi, Ltd. 2011. All rights reserved.
Slide 8: 2-1 Market Trends and Competitive Environment
2-1 Market Trends and Competitive Environment Emerging markets expected to grow, slow recovery expected in Economy industrialized nations Accelerating global competition, rise players from emerging nations Japan: Recovery slow in 2011 due to earthquake etc., reductions in IT investment continue IT m
Slide 9: 2-2 Focused Businesses for the Future and Hitachi Strengths
2-2 Focused Businesses for the Future and Hitachi Strengths Business growth based on Hitachi strengths of fusing "Information" and "Control" - Create safe, secure, and comfortable social infrastructure supported by highly reliable systems - Next generation Government Financial institutions transport
Slide 10: 2-3 FY2015 Targets
2-3 FY2015 Targets FY2015 Revenues: ¥2.3 trillion Operating income ratio: 8% Targets Overseas revenue ratio: 35% Services revenue ratio: 65% Leading company in Social Innovation Business Global company recognized for its strong products and services Strengthen and expand Strengthen and expand domest
Slide 11: 2-4 Strengthen Domestic Businesses
2-4 Strengthen Domestic Businesses Key policies Strengthen core domestic businesses, add value, shift to services Development of new business areas Achieve global growth by strengthening and expanding core domestic businesses and growing fields © Hitachi, Ltd. 2011. All rights reserved. 11
Slide 12: 2-5 Strengthen Core Domestic Businesses
2-5 Strengthen Core Domestic Businesses Add value to businesses to expand core businesses in Japan Expand into new areas through involvement from upstream operations Financial ・ Construct core systems and retailing systems for major companies institutions ・ Expand highly reliable outsourcing service
Slide 13: 2-5 Strengthen Core Domestic Businesses
2-5 Strengthen Core Domestic Businesses Add value to businesses to expand core businesses in Japan Expand into new areas through involvement from upstream operations Financial ・ Construct core systems and retailing systems for major companies Efforts institutions tohighly Expand expand business reli
Slide 14: 2-6 Upstream Experience Oriented Approach (Ex Approach)
2-6 Upstream Design Techniques through Collaborative Creation with Customers Experience Oriented Approach (Ex Approach) Method combining the processes and skills necessary to form consensus quickly Reform business processes and systems through collaborative creation with customers Observe workplaces
Slide 15: 2-7 Creating Highly Reliable Cloud Computing Services
2-7 Creating Highly Reliable Cloud Computing Services Aim to create highly reliable cloud computing services for social infrastructure systems and mission critical operations Expand introduction to Introduce and expand Full-scale application in core enterprise information application in core corpora
Slide 16: 2-8 Strengthening Cloud Computing Business
2-8 Strengthening Cloud Computing Business Our strength: Provision of reliable cloud services ■ Full support across all fields, including facilities, IT, service development and data center operation as a electric conglomerate ■ Reflection of large-scale evaluation by utilization within the Hitachi
Slide 17: 2-9 Promote Fused Businesses Leveraging Hitachi's Strength
Promote Fused Businesses Leveraging Hitachi's Strength 2-9 in the Information Business Create safe, secure, comfortable social infrastructure and provide greener, high-value services Hitachi's next generation city : build a city with sustainable relationship between humans and the earth Sino-Singapo
Slide 18: 2-10 Strengthen Global Business
2-10 Strengthen Global Business Key policies Expand business through the three pillars of growth and synergy generation First Pillar Create high added value in platform business ~"One Platform for All Data"~ Second Pillar Expand global consulting network and business scale Third Pillar Realization o
Slide 19: 2-11 First Pillar: Platform Solutions Business Centered on Storage Systems
2-11 First Pillar: Platform Solutions Business Centered on Storage Systems Business Vision: "Data Drives Our World" Add value to platform solutions supporting data utilization Data Utilization and analysis collection and Content cloud Information cloud of mass data management ■Shift from content clo
Slide 20: 2-12 First Pillar: Platform Solutions Business Centered on Storage Systems
2-12 First Pillar: Platform Solutions Business Centered on Storage Systems Create new value through integrated platforms and mass data utilization ■Realization of long-term preservation of data, high-speed search and analysis ■Development of business fields that utilize mass data (Healthcare, compli
Slide 21: 2-13 Second Pillar: Consulting Business
2-13 Second Business Pillar: Consulting Business Expand global consulting business Expand global consulting network 39 bases, staffed by a little over 4,000 persons (as of the end of May, 2011) ■ Established bases in China and India ■ Acquired Sierra Atlantic (U.S.) (December 2010) Global consulting
Slide 22: 2-14 Third Pillar: Integrated IT Services Business
2-14 Third Pillar: Integrated IT Services Business Expand business domains in global IT service field Continue to look at M&As for bolstering business and customer bases ■ Managed service business based on data centers Target ■ Cloud computing business including SaaS/PaaS/IaaS* Third Pillar: Integra
Slide 23: 2-15 Aggressively Promote Solutions Business Overseas
2-15 Aggressively Promote Solutions Business Overseas Expand solutions business overseas, mainly targeting the finance and industry sectors Extend greater support for Solutions developed in Japan that Japanese companies expanding have a proven domestic track record global business ・ Finance: risk ma
Slide 24: 2-16 Expand Business in Emerging Markets
2-16 Expand Business in Emerging Markets Actively develop China, India and Brazil as priority markets China ■ Promote commercialization (finance IT business*, data centers and services, etc.) through alliances with local companies ■ Cultivate regional customers ・Establish consulting bases: win conti
Slide 25: Contents
Information & Telecommunication Systems Business Strategy Contents 1. Business Overview and Outlook 2. Growth Strategy 3. Strengthening Business Bases 4. Contribution towards Japan’s Recovery 5. Conclusion © Hitachi, Ltd. 2011. All rights reserved.
Slide 26: 3-1 Strengthening Business Bases
3-1 Strengthening Business Bases Raise efficiency of group consolidated management ■ Synergy efforts arising from establishment of Hitachi Solutions* in October, 2010 ・ Orders up by ¥15.0 billion (FY2010) ・ Year-on-year sales increase of 10% (FY2011) ・ Provide compound solutions combining strong sol
Slide 27: 3-2 Strengthen company business management system
3-2 Strengthen company business management system Provision of optimal solutions for customers by maximizing customer leverage and satisfaction and improvement of efficiency Hitachi Solutions, Ltd.: October, 2010 started operations Hitachi Systems, Ltd. (provisional name): To start operation in Octo
Slide 28: 3-3 Contribution to Environment
3-3 Contribution to Environment Global Environment Contribution Plan by IT Prevention of global warming Carbon footprint project Recycling and reuse of resources Product collection promotion project ・Product collection center established (FY2010) ・Set up collection routes for rare earth metals and i
Slide 29: Contents
Information & Telecommunication Systems Business Strategy Contents 1. Business Overview and Outlook 2. Growth Strategy 3. Strengthening Business Bases 4. Contribution towards Japan’s Recovery 5. Conclusion © Hitachi, Ltd. 2011. All rights reserved.
Slide 30: 4-1 Contribution towards Japan's Recovery
4-1 Contribution towards Japan’s Recovery Support customers’ recovery and preparations for the future Reconstruction aid Business continuity Reduction of power consumption Establish new data centers or increase floor space Power saving at data centers (Okayama, Yokohama and other locations) Offer fr
Slide 31: Contents
Information & Telecommunication Systems Business Strategy Contents 1. Business Overview and Outlook 2. Growth Strategy 3. Strengthening Business Bases 4. Contribution towards Japan’s Recovery 5. Conclusion © Hitachi, Ltd. 2011. All rights reserved.
Slide 32: 5-1 Conclusion
5-1 Conclusion Revenues (Billion yen) Operating income (Billion yen) Hardware/software (Operating income ratio) Services 8.0％ 2,300 6.5％ 7.0％ 1,700 1,750 185 122 110 Services revenue ratio 60% 60% 65% FY2011 FY2012 FY2015 FY2011 FY2012 FY2015 (Forecast) (Target) (Target) (Forecast) (Target) (Target)
Slide 33: 5-2 Conclusion: FY2015 Targets
5-2 Conclusion FY2015 Targets Revenues: ¥2,300 billion Operating income ratio: 8% Overseas revenue ratio: 35% Services revenue ratio: 65% Contribute to Social Innovation Business through collaborative creation with customers © Hitachi, Ltd. 2011. All rights reserved. 33
Slide 34: Cautionary Statement
Cautionary Statement Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s current views with respect to certain future events and financial
Slide 35: HITACHI
HITACHI Inspire the Next