Hitachi: one of the biggest Japanese conglomerates

providing consulting and financial services.

Listed on Tokyo Stock Exchange, it is a constituent of

Nikkei 225 and part of the TOPIX Indices.

11 core industries: Information & Telecommunication

Systems, Social Infrastructure, High Functional

Materials & Components, Financial Services, Power

Systems, etc.

Key figures (2012):

Revenues: $95 billion

Operating income: $4.1 billion

Net profit: $3.5 billion

Internal Merger: Merge of Hitachi Information & Communication Engineering,Hitachi Computer Peripherals, Information & Telecommunication Systems Company (April 2013). Hitachi LTD subsidiaries.

In 1910 - Founded by Namihei Odaira

Since the late 1960s, Hitachi has established the export-oriented production bases:

Electric induction motor, initially developed for use in copper mining.

World War I - Became the domestic leader in electric motors and electric power industry infrastructure

In 1969 – Taiwan Hitachi TV

In 1972 – Hitachi Consumer Singapore

In 1978 – Hitachi Semiconductor America

In 1980 – Hitachi Semiconductor Germany

In 1985 – Hitachi VCR production in USA

In 2000-2009 – Hitachi holds operations in almost all potential markets to its business segments.

In 2012 - Sold subsidiary Hitachi Global Storage Technologies to Toshiba

In 2014 - Hitachi and Mitsubishi Heavy Industries agreed to merge their thermal power generation businesses into a joint venture to be owned 65% by Mitsubishi Heavy Industries and 35% by Hitachi.

Interwar era: Growing and Development

stage of products

Second World W (WW2); agreements

and relations with USA

Licensing and growing of

market share abroad

Subsidiaries through

acquisitions and creation

of new companies.

Taiwan 1969

Singapur and Malaysia 1972

USA 1985

Germany 1980

America 1978

Principal Subsidiaries: Babcock-Hitachi K.K.; Chuo Shoji, Ltd.; Hitachi Air Conditioning & Refrigeration Co., Ltd.; Hitachi America Ltd.;

Hitachi Asia Pte. Ltd.; Hitachi Australia Ltd.; Hitachi Auto Systems Co., Ltd.; Hitachi Automotive Products (U.S.), Inc.; Hitachi Building Systems

Engineering and Service Co., Ltd.; Hitachi Building Systems Sales (East) Co., Ltd.; Hitachi Cable, Ltd.; Hitachi Chemical Co., Ltd.; Hitachi

Computer Products (Europe) S.A.; Hitachi Construction Machinery Co., Ltd.; Hitachi Consumer Products (America), Inc.; Hitachi Consumer

Products (U.K.) Ltd.; Hitachi Consumer Products (S) Pte. Ltd.; Hitachi Credit Corporation; Hitachi Data Systems Holding Corp.; Hitachi Denshi,

Ltd.; Hitachi Electronic Components Sales Co., Ltd.; Hitachi Electronic Devices (USA), Inc.; Hitachi Electronic Devices (Singapore) Pte. Ltd.;

Hitachi Electronic Products (Malaysia) Sdn. Bhd.; Hitachi Electronics Engineering Co., Ltd.; Hitachi Electronics Service Co., Ltd.; Hitachi

Engineering & Services Co., Ltd.; Hitachi Engineering Co., Ltd.; Hitachi Europe Ltd.; Hitachi Hokkai Semiconductor, Ltd.; Hitachi Home

Electronics (America), Inc.; Hitachi Hometec, Ltd.; Hitachi Information Systems, Ltd.; Hitachi Keisho, Ltd.; Hitachi Kiden Kogyo, Ltd……(…)

(Nomura Research Institute, 2010)

Nomura Research Institute, 2010

系列 A Keiretsu is a set of companies with interlocking business

relationships and shareholdings. It is a type of informal business group

where the member companies own small portions of the shares in each other's

companies, centered on a core bank; this system helps insulate each

company from stock market fluctuations and takeover attempts, thus enabling

long-term planning in innovative projects.

Hitachi operates under a horizontal keiretsu: it is set up around a

Japanese bank. The bank assists these companies with a range

of financial services.

The leading horizontal Japanese keiretsu, also referred to as the “Big

Six”, include: Fuyo, Sanwa, Sumitomo, Mitsubishi, Mitsui, and Dai-

Ichi Kangyo bank groups.

Nomura Research Institute, 2010

The subsidiaries and partners policies of Hitachi consists of the following five

statements:

1) Hitachi holds the power of management even when it does not have

the majority of the shares.

2) Hitachi tries to coordinate its own corporate culture and the local culture.

3) Hitachi decrease the number of Japanese employees in the local firm as

the business goes well.

4) The local firm is responsible for its profit and sales from the

beginning.

5) The local firm should pay the dividends within three to five years.

Drivers from the Economic perspective

Drivers from Process

perspective

Drivers from Network

perspective

Transaction costs of maintaining a

licensing instead of subsidiaries

International network of

distributors and channels (e.g)

Last level of internationalization

(conglomerate)