yokogawa electric corporation yokogawa’s solution services · yokogawa’s solution services in...

Copyright © Yokogawa Electric Corporation 2016/11/1 - 0 -

November 1, 2016

Yokogawa Electric Corporation

Yokogawa’s Solution Services

Hitoshi Nara Director of Yokogawa Electric Corporation

President of Yokogawa Solution Service Corporation


Apr. 1985 Joined the Company Oct. 2001 Deputy Managing Director of Yokogawa Engineering Asia Pte. Ltd. Oct. 2003 Managing Director of Yokogawa (Thailand) Ltd. Jan. 2007 Head of Sales Div. I, Industrial Solutions Business Headquarters Apr. 2010 Senior Vice President, Head of Industrial Solutions Business Headquarters Jun. 2011 Director and Senior Vice President, Head of Industrial Solutions Business Headquarters Apr. 2012 Director and Senior Vice President, Head of Industrial Solutions Service Business Headquarters Apr. 2013 Director of the Company, President of Yokogawa Solution Service Corporation (present)

Presenter’s Career at Yokogawa


Contents

1. Profile of Yokogawa Solution Service Corporation 2. Yokogawa’s Solution Services in the Japan IA & Control Business (Market opportunities, Two basic strategies / Japan’s manufacturing sector / IA & control business domains) 3. Yokogawa’s Strengths / Success Cases 4. Future Development (Entering new business domains by leveraging IIoT and alliances) 5. Future Direction

P. 3

P. 4

P. 8

P.16

P.18


Profile of Yokogawa Solution Service Corporation

・Improve operational efficiency ・Speed up decision making ・Accelerate expansion of value-added solution service businesses

April 1, 2013: Launch of Yokogawa Solution Service Corporation

integrating the sales, engineering, and service functions

Transforming Yokogawa into a solutions and service company

Sales

Engineering Services

Integration of 3 functions

In Japan’s control business,


IA & Control Business – Market opportunities –

1 2 3 Further development of resource and energy sector

Innovation of industrial structure by integration of devices (“things”) and information ⇒(IoT)

Smartization of society⇒(ICT)


IA & Control Business – Two basic strategies –

The global No.1 company in IA

Customer base-driven expansion throughout energy supply chain Expand into new

industries

Starting in Asia, expand business

operations worldwide

Leveraging our strength in the Japan market

Top share of the market


Japan’s Manufacturing Sector – Current considerations –

12,000

8,000

6,000

4,000

2,000

0

10,000 2,810 3,278

1,892

1,570

1,807

1,681

1,326

1,678

1,632

1,851

1,422

1,221

(year)

Population (X10k)

15-24yrs.

25-34yrs.

35-44yrs.

45-54yrs.

55-64yrs.

65yrs.over

Productive-age

1990 92 94 96 98 2000 02 04 06 08 10 12 14

Source: Compiled using data from the Labor Force Survey. (Ministry of internal affairs and communications) Innovation

• Aging/shrinking workforces • High energy costs • Intensification of global

competition

Changes that are having an impact on manufacturers

Direction of Japan’s manufacturing

• Advances in intelligent manufacturing

• Changing roles of domestic factories

“Mother factory” for manufacturing in other countries Flexible factory for high-mix low-

volume manufacturing Innovation factory for new

technologies and new products


IA & Control Business Domains Covered by Yokogawa

Field equipment

Control systems/Engineering Control software/System integration

Production management

Management strategy Business optimization

Simulation ERP Business

management

Factory management

Production process/control

Plant site

Business strategy /plan

Design Engineering Commissioning Operations f

Lifecycle services

http://www.kbcat.com/index.php


Yokogawa’s Strengths

● The four GENs - Professionals who have extensive knowledge of the four GENs: genba (plant sites), genbutsu (actual things), genjitsu (current status), and genchika (localization) - 24/7 support system

● Trust - Reliable products with the same high quality, a long lifespan, and excellent environmental resistance all over the world - Ability to optimize processes for both industry and society (engineering) - Perseverance and persistence (ability to carry through projects)

● Co-creation - Co-creating value with customers and serving as a provider of holistic solutions spanning everything from management to field operations - Extensive knowledge of industries, manufacturing processes, and engineering - Good citizenship (our corporate philosophy), the pursuit of harmony, and sharing the same goals as our customers


Success Cases

●Case 1: Expanding the Value Chain for Existing Customers (customer: a chemical company) ●Case 2: Developing New Customers through Consulting （customer: a beverage company） ●Case 3: Expanding the Information Business （customer: Riken Keiki Co., Ltd.）


Business optimization

Management strategy

Conventional businesses

Forming a kaizen team with the customer Solving problems and improving processes

Consulting to solve problems

Value chain for increasing sales and improving profitability

Customer: a chemical company

Expanding the service business

Improvement leader development program

(ILDP)

Comparative effectiveness

analysis service

Rolling out to affiliates

Case 1: Expanding the Value Chain for Existing Customers

DCS Field equipment

- Sale of standalone products - Competing with other companies

Becoming the exclusive supplier for our customers

Plant site


Business management

Factory management


Ongoing kaizen consulting


Plant site


Business management

Factory management

Conventional businesses

Customer: a beverage company

By building trust, Yokogawa captured a major customer from a competitor.

Operational support order

Kaizen consulting

Roll out to 8 plants

MES order

Field equipment order

Visualizing energy costs

DCS order

Warehouse automation order

N e w c u s t o m e r s

Consulting to solve problems

Case 2: Developing New Customers through Consulting


Business optimization

Management strategy


■ Leveraging its extensive industry knowledge, Yokogawa provided consulting for every aspect of this company’s business operations. - Pre-sales kaizen business consulting

■ Restructuring of company operations to improve profitability of service business - Consolidation of nationwide maintenance operations - Central management of parts inventory - Reduction of inventory and shortening of delivery lead times

Paratechno Co., Ltd. Smiles Co., Ltd. Riken Keiki Co., Ltd.

Case 3: Expanding the Information Business

Entering new industries

Headquarters: Ope ra t i ons :

C a p i t a l : S a l e s : B u s i n e s s :

Riken Keiki Co., Ltd. Company profile

Itabashi-ku, Tokyo Headquarters, 2 plants, 21 offices, 32 service offices in Japan; operations in 7 other countries 2.67 billion yen 23.41 billion yen (FY2015) A major manufacturer of gas detectors and alarms (listed in first section of TSE)

Successes in supporting key business operations through the provision of after-sales services

http://www.rikenkeiki.co.jp/products/detail/108

http://www.rikenkeiki.co.jp/products/detail/111


Data gathering

phase

Identification phase

Project proposal

phase

Feasibility study phase

Project planning

& Execution

phase

Rollout phase

Follow up phase

Maintenance, repair and

operation phase (MRO)

Solution Service Business Cycle

Continued proposal of solutions and provision of support over the entire plant lifecycle

Plants 40–50 year

lifecycle


Results and Reasons for Steady Growth

● Improving profitability - Integration of our three primary business functions has improved profitability (particularly for the information business). - Optimization of cost structure - Optimization of strategies for areas, industries, and products has enabled us to improve our site response (improved customer focus)

● Capturing a larger share of the Japanese market※

- Even in a tough economy, winning orders for integration projects

Area strategy

Industry strategy

Product strategy

(※Based on a company survey)


123.8 132.4 126.8 125.6 118.8 100.6 99.4 103.5 100.5 97.9 98.1 101.8

107.3 120.5

182.4 196.6

182.4 156.2 161.2 173.7

195.2 238.4

259.9 264.9 231.1

252.9

309.2 322.2 301.2

256.8 260.6 277.2

295.7

336.3 358.0 366.7

7.2%

9.9% 11.6% 12.1%

9.6% 7.7%

6.3% 7.2%

6.1% 7.2% 7.6%

10.0%

FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

US dollarUSドル

(Yen) 107.46 113.09 117.00 113.80 100.66 92.61 85.13 78.82 83.33 100.67 110.58 119.99

FY04 FY13 FY10 FY09 FY12 FY11 FY08 FY07 FY06 FY05 FY15 FY14

Operating income to sales ratio

(Billion ¥) ■Outside Japan ■Japan

Trend of Global Sales in Control Segment

＜Exchange rate＞


Future Development

Entering new business domains by leveraging the Industrial IoT (IIoT)


Mitsubishi Research Institute, Inc. Cisco Systems G.K. Microsoft Japan Co., Ltd.

Future Development

Entering new business domains through alliances with other companies

Co-creating value

Partners

Customers

Yokogawa will help its customers achieve their vision by working with them and its business partners to co-create value.


Future Direction

E x p a n d f r o m A s i a t o t h e w o r l d b y l e v e r a g i n g

s t r e n g t h s r e f i n e d i n J a p a n

Japan

Outside Japan

Improve profitability


Disclaimer

The information pertaining to our business plans and forecasts that has been provided in this presentation and at analyst meetings contains forward-looking statements that are based on our management’s current knowledge and require the making of assumptions about future events. As such, it cannot be guaranteed that these statements will not differ materially from actual results.

IR Group, Corporate Communications Department Yokogawa Electric Corporation

Email: [email protected] Phone: +81-422-52-5530

URL: http://www.yokogawa.com/pr/ir/index.htm

yokogawa electric corporation yokogawa’s solution services · yokogawa’s solution services in...

Documents