Medium-Term Management Plan VISION75 - New Departure · Medium-Term Management Plan VISION75 - New...
Transcript of Medium-Term Management Plan VISION75 - New Departure · Medium-Term Management Plan VISION75 - New...
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February 5, 2004
Medium-Term Management PlanVISION75
- New Departure -
MediumMedium--Term Management PlanTerm Management PlanVISION75VISION75
-- New Departure New Departure --
Fuji Photo Film Co., Ltd.Fuji Photo Film Co., Ltd.
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Change in operating results
3,000(Unit: Billions of yen)
1,387.0 1,348.8 1,383.3
2,401.12,505.7
165.3147.9 149.7
168.6183.3
Revenue
11.9%11.0% 10.8%
7.0% 7.3%
Operating marginOperating margin
Operating incom
e
500
Note: Operating income for the year ended March 31, 2003 excludes a loss of ¥23.1 billion onthe settlement and curtailment of a defined benefit plan.
2,500
2,000
1,500
1,000
500
0
450
400
350
300
250
200
150
100
50
01999 2000 2001 2002 2003
Change in Operating ResultsChange in Operating Results
Reve
nue
Operating incom
e
Year ended March 31
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Business Environment OverviewBusiness Environment Overview
Rapid digitization of the marketRapid digitization of the marketRapid digitization of the market1 Converted Fuji Xerox Co., Ltd., into a consolidated subsidiaryConverted Fuji Xerox Co., Ltd., Converted Fuji Xerox Co., Ltd., into a consolidated subsidiaryinto a consolidated subsidiary2
Intensified competitionIntensified competition
MediumMedium--Term Management PlanTerm Management PlanAhead of Fujifilm’s 75th anniversary, over the next three years, the Company will execute
structural reforms and implement a new growth strategy under its new management system.
“New Departure”
Reduced operating marginExpansion of business areasReduced operating margin
Expansion of business areas
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Basic Strategies & Objectives for VISION75Basic Strategies & Objectives for VISION75
Further motivate employeesFurther motivate employeesand enhance skillsand enhance skills
Building new growth strategies
Building new growth strategies
Enhancing consolidated management
Enhancing consolidated management
Implementing comprehensivestructural reforms overall management levels
Implementing comprehensivestructural reforms overall management levels
Target for the year ending March 31, 2009
Revenue: ¥3,500 billionOperating margin: 10%
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New Growth StrategiesNew Growth Strategies
Expand growing businesses by concentrating management resourcesSustain consumer imaging products and ensure a culture of photographyCreate new businesses to support the futureExpand business development in China
Expand growing businesses by concentrating management resourcesSustain consumer imaging products and ensure a culture of photographyCreate new businesses to support the futureExpand business development in China
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Electronic Imaging BusinessElectronic Imaging Business
Digital camerasDigital camerasDigital cameras
Consolidate our positionamong the top three worldwide
Consolidate our positionConsolidate our positionamong the top three worldwideamong the top three worldwide
13 million units6.2 - 6.3 million units
Outlook for the Yearending Mar. 31, 2004Outlook for the Yearending Mar. 31, 2004
Target for the Yearending Mar. 31, 2007Target for the Year
ending Mar. 31, 2007
Sales objectives
Respond to CCD production increase (Have purchased a general-purpose-wafer manufacturing plant from Tohoku Semiconductor Corporation)Broadly strengthen R & D systems (Add approximately 180 employees)Enhance production systems, including those in China(target for the year ending March 31, 2007: 5 million units/year)Reinforce marketing systems (Integrate FUJIFILM AXIA Co., Ltd., FUJIFILM Battery Co., Ltd., and Fujifilm’smarketing division)
Optical electronic components businessOptical electronic components businessOptical electronic components business
Expand into a business with annual revenuesin excess of ¥50 billion by the year ending March 31, 2007
Expand into a business with annual revenuesExpand into a business with annual revenuesin excess of in excess of ¥¥50 billion by the year ending March 31, 200750 billion by the year ending March 31, 2007
Camera modulesLens units
Expand business for mobile phoneswith cameras by adding new buyersExpand business for mobile phonesExpand business for mobile phoneswith cameras by adding new buyerswith cameras by adding new buyers
Expand supplies to other business areas (Security business, in-car components field, etc.)
Concentrate on advanced CCD, lens, and mounting technologies
Further strengthen Fujifilm Group’s proprietary technologies and develop differentiated productsKey device technologies (Super CCD, Fujinon Lens)Image processing technology (Image Intelligence™)High-density mounting and assembly technology
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Flat Panel Display (FPD) Materials BusinessFlat Panel Display (FPD) Materials Business
Seek to establish a materials supply system to handle all types of FPDs, centered on liquid crystal modesSeek to establish a materials supply system to handle all types of FPDs, centered on liquid crystal modes
¥200 billion
Target for the yearending Mar. 31, 2009Target for the year
ending Mar. 31, 2009
Revenue
¥136 billion
Target for the yearending Mar. 31, 2007Target for the year
ending Mar. 31, 2007
¥70 billion
Outlook for the yearending Mar. 31, 2004Outlook for the yearending Mar. 31, 2004
Four main products:
Strengthen R&D systemsEstablished FPD Materials Division and Laboratory (December 2003)
Increase capital investmentCumulative April 2004 – March 2007 total: Approx. ¥110 billion)
FUJITAC Anti-reflection (CV) filmWide View Film Transer
Growth and enlargement of liquid crystal monitorsSpread and expansion of liquid crystal TVsGrowth and enlargement of liquid crystal monitorsSpread and expansion of liquid crystal TVs
Rapid expansion of demandDiversification of needsRapid expansion of demandDiversification of needs
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Document Solutions BusinessDocument Solutions Business
Office Services business: Promotion of a comprehensive documentation outsourcingservice business for the office market
Production Services business: Offering of high-value-added services in digital printing marketthrough print on demand
Printer business: Global growth centered on color laser printersCopying Machine business: Maintaining of earnings base by shifting to color/multifunction
machines
Office Services business: Promotion of a comprehensive documentation outsourcingservice business for the office market
Production Services business: Offering of high-value-added services in digital printing marketthrough print on demand
Printer business: Global growth centered on color laser printersCopying Machine business: Maintaining of earnings base by shifting to color/multifunction
machines
Cultivate new growing businesses andfocus resources on more profitable areas in existing businessesCultivate new growing businesses andCultivate new growing businesses andfocus resources on more profitable areas in existing businessesfocus resources on more profitable areas in existing businesses
Broaden sales channels in China
Reorganize domestic sales companies
Strengthen marketing capabilities of solution businesses
Broaden sales channels in China
Reorganize domestic sales companies
Strengthen marketing capabilities of solution businesses
Reorganize and strengthen sales andmarketing organizationReorganize and strengthen sales andReorganize and strengthen sales andmarketing organizationmarketing organization
Strengthen organization and improve operating marginStrengthen organization and improve operating marginStrengthen organization and improve operating margin Explained in detail on slide 18 (Pursue Structural Reforms)
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New Growth StrategiesNew Growth Strategies
Expand growing businesses by concentrating management resourcesSustain consumer imaging products and
ensure a culture of photography Create new businesses to support the futureExpand business development in China
Expand growing businesses by concentrating management resourcesSustain consumer imaging products and
ensure a culture of photography Create new businesses to support the futureExpand business development in China
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Photographic color film (including QuickSnap) and color paperPhotographic color film (including QuickSnap) and color paper
Specific measuresDevelop new, distinct products through full use of silver halide technology
Ultrasensitive film that approximates human vision
Evolve QuickSnapIncrease sales in emerging markets
Maintain revenue
Maintain profitability through structural review of production, sales, and R&DThorough cost reductions, including review of production systemsReview of domestic and overseas sales systems Select R&D themes
カラーフィルム
Decrease in total demandfor photographic color filmDecrease in total demand
for photographic color film Increase in number of total shotsIncrease in number of total shots
Expansion of potentialprint demand
Expansion of potentialprint demand
Photographic color filmPhotographic color film
Increase in the number of shotsfrom digital cameras andresulting digital prints
Specific measuresIncrease digital minilab salesStrengthen Internet print servicesReinforce digital camera printcampaigns
By increasing the number of digital camera prints, expand and turn around demand
Color paper and chemicalsColor paper and chemicals
Rapid spread of digital cameras and mobile phones with camera functions
Rapid spread of digital cameras and mobile phones with camera functions
Sustain Consumer Imaging Products and Sustain Consumer Imaging Products and Ensure a Culture of PhotographyEnsure a Culture of Photography
Sustain consumer imaging materials and ensure a culture of photography0
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2004 2007
Change in total number of shots and resulting color prints(domestic market)
12
(Unit: Billion shots)
Color prints
Photographiccolor film
Photographiccolor film
Digital camera prints
Digital camera prints
Home printsHome prints
Image not saved, not printed
Image not saved, not printed
Year ending Mar. 31
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New Growth StrategiesNew Growth Strategies
Expand growing businesses by concentrating management resources Sustain consumer imaging products andensure a culture of photographyCreate new businesses to support the futureExpand business development in China
Expand growing businesses by concentrating management resources Sustain consumer imaging products andensure a culture of photographyCreate new businesses to support the futureExpand business development in China
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Create New Businesses to Support the FutureCreate New Businesses to Support the Future
1. Orientation of new technologies and new businesses
Highly functional materialsInformation on environment and life sciences
Optical devices/systemsOptics-related businesses
Precision assembly technologyNano technology
Organic synthesis technology
Lens technology
CCD technology
Laser technologyDigital image processingSoftware technology
~Image IntelligenceTM~
Miniature fabricationprocessing technology
Polymer technology
Digital imagingImage information systems and solutions businesses
Organic and inorganic pigmentation technology
Silver-halide technologyImage design evaluation
technologyThin multilayer
coatings technologyOptical designing
techniques
Xerography technology
Optical elementtechnology
Fujifilm’s technologicaladvantages =
materials technologiesto freely control the
characteristics of light
Also actively promote M&A and alliances with other companies
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Create New Businesses to Support the FutureCreate New Businesses to Support the Future
Management of Technology DivisionManagement of Technology Division
Business Development DivisionBusiness Development Division
Intellectual Property DivisionIntellectual Property Division
Advanced Core Technology LaboratoriesAdvanced Core Technology Laboratories
Life Science Research LaboratoriesLife Science Research Laboratories
Imaging Software Technology CenterImaging Software Technology Center
Materials Research DivisionMaterials Research Division
Production Engineering & Development Division
Production Engineering & Development Division
Recording Media Products LaboratoriesRecording Media Products Laboratories
Product Planning & Development DivisionProduct Planning & Development Division
Printpix Division Technology GroupPrintpix Division Technology Group
President & CEOPresident & CEO
Equipment Development and Production Division
Equipment Development and Production Division
R&D Management HeadquartersR&D Management Headquarters
Recording Media Products DivisionRecording Media Products Division
Electronic Imaging Products DivisionElectronic Imaging Products Division
Printpix Products DivsionPrintpix Products Divsion
New businessexpansion
Newly established R&D overview function
Establish new R&D overview function for the entire GroupSet up three laboratories to support new business expansion Focus on review of intellectual property strategyStrengthen manufacturing technologies
Establish new R&D overview function for the entire GroupSet up three laboratories to support new business expansion Focus on review of intellectual property strategyStrengthen manufacturing technologies
2. Restructuring of research and development
FPD Materials Research LaboratoryFPD Materials Research LaboratoryFPD Materials DivisionFPD Materials Division
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Create New Businesses to Support the FutureCreate New Businesses to Support the Future
¥200 billion¥175 billion
Outlook for the year ending Mar. 31, 2004 Outlook for the year ending Mar. 31, 2004 Target for the year ending Mar. 31, 2007 Target for the year ending Mar. 31, 2007
3. Breakdown of investment in R & D
2004 outlook 2007 target
Percentage of research anddevelopm
ent investment
40
30
20
10
0
Consumer imaging products
New products
28
65
2115
50
70
0%
5%
10%
15%
20%
25%
35%
16%
33%
12%
60 30%
8%8%
(Unit: Billions of yen)
2.3 times
30% reduction
Year ending Mar. 31
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New Growth StrategiesNew Growth Strategies
Expand growing businesses by concentrating management resources Sustain consumer imaging products andensure a culture of photographyCreate new businesses to support the futureExpand business development in China
Expand growing businesses by concentrating management resources Sustain consumer imaging products andensure a culture of photographyCreate new businesses to support the futureExpand business development in China
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Build future production system
Transfer all copying machine and printer mass production functions
Aim to attain leading market share for the FUJIFILM brand by providing total solutions in the digital imaging sector
Aim to attain leading market share for the FUJIFILM brand by providing total solutions in the digital imaging sector
Strengthen China head office functionsand enhance sales systemsBuild and expand production bases
Business development focused on digital cameras, consumer imaging products, documents, graphic arts systems, medical imaging, and optical electronic components
Business development focused on digital cameras, consumer imaging products, documents, graphic arts systems, medical imaging, and optical electronic components
Build and expand production base
Beijing
ShanghaiSuzhou
Tianjin
Fuji Photo Film Group ChinaHead Office
Transfer all copying machine andprinter mass production functions
Expand digital camera production
CTP (computer-to-plate)Expand production line
Optical electroni c ComponentsExpand production (digital camera lenses, lens units for mobile phones)
FUJIFILM STARLIGHTFUJIFILM STARLIGHTFUJIFILM STARLIGHT
Fuji Photo Film (China)Investment
Fuji Photo Film (China)Fuji Photo Film (China)InvestmentInvestment
Fuji Xerox (Shanghai)Fuji Xerox (Shanghai)Fuji Xerox (Shanghai)
FUJIFILM ImagingSystems (Suzhou)
FUJIFILM ImagingFUJIFILM ImagingSystems (Systems (SuzhouSuzhou))
Fuji Xerox of ShenzhenFuji Xerox of ShenzhenFuji Xerox of Shenzhen
Fuji Photo Optical(Tianjin)
Fuji Photo OpticalFuji Photo Optical((TianjinTianjin))
Shenzhen
Digital imaging related equipment, materials, etc.
Expand Business Development in ChinaExpand Business Development in China
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Comprehensive Structural ReformsOver All Management Levels
Comprehensive Structural ReformsOver All Management Levels
Reorganize all production, sales and distribution, and purchasing systems, and improve efficiency Strengthen structure of Fuji Xerox
Reorganize all production, sales and distribution, and purchasing systems, and improve efficiency Strengthen structure of Fuji Xerox
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Pursue Structural ReformsPursue Structural Reforms
The year ending March 31, 2007, cost reduction target from structural reforms: approx. ¥200 billion (compared to the year ending March 31, 2004)
The year ending March 31, 2007, cost reduction target from strucThe year ending March 31, 2007, cost reduction target from structural tural reforms: approx. reforms: approx. ¥¥200 billion (compared to the year ending March 31, 2004)200 billion (compared to the year ending March 31, 2004)
Reorganize all production, sales and distribution, and purchasinReorganize all production, sales and distribution, and purchasing g systems, and improve efficiency (excluding Fuji Xerox)systems, and improve efficiency (excluding Fuji Xerox)
Reorganize production systemConduct worldwide reorganization of coating and film machinesReorganize equipment production system on consolidated basis
Reform domestic sales system Fujifilm headquarters: Specialize in business planning and product planning functions Sales companies/general labs: Reorganize with goal of improving efficiency ofsales/distribution functions
Reform purchasing strategy Review and optimize purchasing processIncrease efficiency of purchasing and procurement functions for all domestic GroupcompaniesBuild global purchasing and procurement system
Cut costs by approx. ¥20 billion by the year ending March 31, 2007Cut costs by approx. ¥20 billion by the year ending March 31, 2007
Cut costs by approx. ¥20 billion by the year ending March 31, 2007Cut costs by approx. ¥20 billion by the year ending March 31, 2007
Cut costs by approx. ¥25 billion by the year ending March 31, 2007Cut costs by approx. ¥25 billion by the year ending March 31, 2007
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Pursue Structural ReformsPursue Structural Reforms
Strengthen structure of Fuji XeroxStrengthen structure of Fuji XeroxStrengthen structure of Fuji Xerox
10%6%
Outlook for the yearending Mar. 31, 2004 Outlook for the year
ending Mar. 31, 2004 The year ending Mar. 31, 2007The year ending Mar. 31, 2007
Improve Document Solutions operating marginImprove Document Solutions operating margin
Reduce total production Shift mass production base to China, reform procurement costscosts:
Reduce maintenance and Reorganize service systems, improve reliabilityservice costs:
Cap total personnel Reform pension and retirement allowances, reform personnel system,expenses: improve ratio of direct and indirect personnel expenses
Implement cost reductions from Restructure (downsize, flatten hierarchy), increase development efficiencyother structural reforms
The year ending March 31, 2007 cost reduction target: approx. ¥45 billionThe year ending March 31, 2007 cost reduction target: approx. ¥45 billion
The year ending March 31, 2007 cost reduction target: approx. ¥10 billionThe year ending March 31, 2007 cost reduction target: approx. ¥10 billion
The year ending March 31, 2007 cost reduction target: approx. ¥12 billionThe year ending March 31, 2007 cost reduction target: approx. ¥12 billion
The year ending March 31, 2007 cost reduction target: approx. ¥30 billionThe year ending March 31, 2007 cost reduction target: approx. ¥30 billion
Seek to improve ratio of expenses to sales by 6.5 percentage points the year ending March 31, 2007 through controlling total personnel expenses and conducting other structural reforms
VISION75Enhance Consolidated Management
VISION75VISION75Enhance Consolidated ManagementEnhance Consolidated Management
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20
Strengthen Management BaseStrengthen Management Base
Enhance consolidated management and controlEnhance consolidated management and control
Build a suitable internal control systemcentered on unified strengthening and promotionof compliance and risk management
Build a suitable internal control systemcentered on unified strengthening and promotionof compliance and risk management
Further strengthen environmental managementFurther strengthen environmental management
Introduce new management indicator (EVA®)
Create IT infrastructure to support consolidated management and control
VISION75Numerical Targets
VISION75VISION75Numerical TargetsNumerical Targets
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Operating Results ObjectivesOperating Results Objectives
4.8%150
8.7%270
3,100
20072007planplan
Net income marginNet income margin
Net incomeNet income
Operating marginOperating margin
Operating incomeOperating income
RevenueRevenue
3.1%80
7.0%180
2,580
20042004outlookoutlook
Year ending March 31Year ending March 31
5.1%180
10.0%350
3,500
20092009targettarget
550Capital investmentCapital investment
2005 2005 -- 2007 2007 cumulative totalcumulative totalYear ending March 31Year ending March 31
(Unit: Billions of yen)
ReferenceReference(Unit: Billions of yen)
FORWARD-LOOKING STATEMENTSThis document contains forward-looking statements. Where any such forward-looking statement includes a statement of the assumptions or bases underlying such a forward-looking statement, Fujifilm cautions that assumed facts or bases almost always vary from the actual results, and differences between assumed facts or bases and actual results can be material, depending upon the circumstances. Where, in any forward-looking statement, Fujifilm or its management expresses an expectation or belief as to future results, there can be no guaranty or assurance that the statement of expectation or belief will result or be achieved or accomplished. The words “forecast,” “project,”“believe,” “expect,” “estimate,” “anticipate,” and similar expressions may identify forward-looking statements.
Taking into account the foregoing, the following are identif ied as important factors, risks or uncertainties that could cause the actual results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, Fujifilm: competitive factors, including, without limitation, pricing, the implementation of Fujifilm’s product strategies, and economic trends in important markets worldwide.
Fujif ilm assumes no obligation to update its forward-looking statements or to advise of any changes in the assumptions and factors on which they are based.
FORWARD-LOOKING STATEMENTSThis document contains forward-looking statements. Where any such forward-looking statement includes a statement of the assumptions or bases underlying such a forward-looking statement, Fujifilm cautions that assumed facts or bases almost always vary from the actual results, and differences between assumed facts or bases and actual results can be material, depending upon the circumstances. Where, in any forward-looking statement, Fujifilm or its management expresses an expectation or belief as to future results, there can be no guaranty or assurance that the statement of expectation or belief will result or be achieved or accomplished. The words “forecast,” “project,”“believe,” “expect,” “estimate,” “anticipate,” and similar expressions may identify forward-looking statements.
Taking into account the foregoing, the following are identif ied as important factors, risks or uncertainties that could cause the actual results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, Fujifilm: competitive factors, including, without limitation, pricing, the implementation of Fujifilm’s product strategies, and economic trends in important markets worldwide.
Fujif ilm assumes no obligation to update its forward-looking statements or to advise of any changes in the assumptions and factors on which they are based.