Hitachi to Establish Global Structure for the Social Innovation Business

NEW DELHI - Feb. 4, 2015 - PRLog -- Hitachi, Ltd. (TSE-6501, “Hitachi”) today announced that it will appoint Chief Executives, who will function as representatives of the Hitachi Group in interactions with regional companies and customers, in four global regions - the Americas, China, Asia/Pacific, and Europe/Russia / Middle East and other areas (“EMEA･CIS”).This change is being made to accelerate Hitachi’s growth in the global market and will take effect on April 1, 2015. In addition to creating regional growth strategies, promoting localization, and effectively utilizing management resources, the Chief Executives will have authority to make investments in new business areas where growth is expected and will be accountable for achieving positive returns on these investments. The Chief Executives will implement a transition to an “autonomous decentralized global management” structure in which each region leads its business autonomously. Hitachi will expand its Social Innovation Business on a global scale, in order to reach the goals set forth in its 2015 Mid-term Management Plan, which will enter its final year in FY2015, and to achieve further growth in 2016 and beyond.

In its 2015 Mid-term Management Plan, a three-year management plan that concludes at the end of FY2015, Hitachi set a goal of achieving an overseas sales ratio of more than 50%, while expanding business in the global market for the Social Innovation Business. In its global plan for regional management, the company created regional strategies for India in December 2012 and for China in June 2014. In addition, it has been rolling out new business strategies by combining the resources of the entire Hitachi Group as outlined in the plan. In April 2014, Hitachi appointed a Global CEO in London, U.K. to supervise global strategies for its Rail Systems Business, and it created structures to enable rapid decision-making close to its customers. Hitachi has also been promoting aggressive sales activities targeting railway projects currently being planned in each region.

In order to resolve a variety of global issues that are becoming increasingly complex and borderless, the Chief Executives will need to act as “control towers,” developing and building solutions to issues along with Hitachi customers through “collaborative creation.” In addition to the global strategies that have been implemented up to now, Hitachi will strengthen the “autonomous decentralized global management” structure in which regional management is conducted autonomously. In each region, the Chief Executive will have authority to make investments in the Social Innovation Business, where growth is expected, and will be responsible for recovering those investments and for regional profits and losses.

In the Asia-Pacific region, where social infrastructure-related demand is very strong, Mr. Ichiro Iino will be appointed Chief Executive for the Asia-Pacific. Mr. Iino will promote solutions targeting the healthcare industry through collaborations with local partnersin Singapore, India, and other countries in that region, and he will promote new financial solutions targeting Japanese banks that are expanding operations in Asia.

In these four regions - the Americas, China, Asia/Pacific, and Europe/ Russia / Middle East and other areas (“EMEA･CIS”) - the Chief Executives will act as “control towers,” securing key accounts and providing services and solutions that leverage the strengths of the Hitachi Group. They will implement Hitachi’s strategy of “autonomous decentralized global management”, which puts responsibility for regional business operations more solidly in the hands of each individual region.

At the same time, Hitachi will promote uniform global operations to enable the efficient use of management resources, in areas such as R&D, procurement, brand strategies, the use of human resources, accounting systems, and thorough compliance. In this way, the Hitachi Group will provide innovations at the highest level, and establish governance as a global company.

Following is an outline of the Social Innovation Business fields in each region where growth is expected, and where the Chief Executives will have authority to makeinvestments as well as responsibility for overall profits and losses.

■  Examples of Social Innovation Business areas currently being targeted in each region:

Global Region  Countries/ Regions covered  Chief Executive  Examples of Social Innovation Business areas currently being targeted

The Americas- North, Central, and South America

Jack Domme (Vice President and Executive Officer) [New appointment]*

(1) Solutions targeting the energy industry (e.g., oil and gas, etc.)
(2) Solutions targeting the communications industry
(3) Solutions targeting the healthcare industry
(4) Business analytics solutions
(5) Connected cars
(6) Security solutions

China- China

Kenichi Kokubo (Vice President and Executive Officer)

(1) Urban planning/development and building facility management solutions

(2) Financial solutions
(3) Solutions targeting the healthcare industry
(4) Solutions targeting smart logistics and e-commerce

Asia/Pacific- ASEAN, India, Oceania, Korea

Ichiro Iino [New appointment] *

(1) Solutions targeting the healthcare industry
(2) Collaborative solutions with developers and conglomerates, and home appliance business targeting the B2B market
(3) Financial solutions

Europe/ Russia / Middle East and other areas (“EMEA･CIS”) - Europe, Russia, CIS, Middle East, Turkey, Africa

Klaus Dieter Rennert

(1) Production/SCM solutions
(2) Solutions targeting the healthcare industry
(3) Solutions aimed at increasing energy efficiency

* New appointment scheduled for April 1, 2015