OMRON's New Long-Term Strategy-
Value Generation 2020
OMRON Group has developed a new long-term management strategy for the decade up to 2020, called "Value Generation 2020," or "VG2020."
What do we mean by Value Generation 2020?
The name "Value Generation 2020" reflects our commitment to achieving growth by generating value for all of our stakeholders.
Achieving growth with VG2020
Though the competitiveness of the global market is growing increasingly intense, there are many business opportunities. We will be employing two different ways of viewing our planet, the "Globe Perspective" and the "Earth Perspective," as we pursue growth opportunities during the VG2020 period.
The "Globe Perspective"
We will use this perspective as we pursue global growth opportunities for our existing business fields. Population growth, and growing middle and higher socioeconomic groups are expected to bring about economic growth to emerging markets. Since the expected growth of consumption in emerging markets will increase demand for the global manufacturing industry, the markets of our industrial automation-related business fields (factory automation devices and electronic components) are expected to expand. In addition to providing value to our stakeholders through our industrial automation-related business fields, we will also strive to do so with our consumer-goods-based healthcare business.
The "Earth Perspective"
We will use this perspective as we attempt to meet social needs relating to the sustainability of our planet. More specifically, we will strive to meet growing worldwide needs relating to global warming, resource depletion, and energy issues and also work to enhance the environmental responsibility of our own business activities.
The VG2020 Scenario
In VG2020 we have divided the decade from 2011 to 2020 into two separate stages reflecting the two perspectives outlined above- the GLOBE Stage and the EARTH Stage.
The GLOBE Stage covers the three years from FY2011 through FY2013 and during this stage we will build a global earnings structure, pursue growth in the global market, and create a foundation that will allow us to reach the VG2020 target of sales revenue exceeding one trillion yen.
The EARTH Stage will cover the seven years from FY2014 through FY2020. During the EARTH Stage we will build on what we achieve during the GLOBE Stage and work on creating new business fields that will generate new value for the Earth. Achieving long-term growth will help us to achieve our VG2020 goals.
|Sales revenue (FY2020)||Over 1 trillion yen|
|Operating Profits (FY2020)||Over 150 billion yen|
|Operating Profit Ratio (FY2020)||15%|
The Pivotal Strategies of VG2020
The pivotal strategies of VG2020 cover the following three areas:
1. Strengthening existing business
We will be focusing on our existing core business field of industrial automation (our factory automation device business and electronic components business) in order to achieve growth and high earning power.
- By reinforcing our industrial automation business during the "GLOBE Stage" and "EARTH Stage," we aim to increase our market share in developed nations, and use this strength to expand in emerging markets.
Target: industrial automation business sales revenue of 700 billion by FY2020.
2. Business expansion in emerging markets
We will aim to achieve growth as quickly as possible by expanding our business in emerging markets- the explosive growth of which is now driving the global economy.
- During the "GLOBE Stage" we will focus on China, where factory automation needs are expanding. We will also strengthen our industrial automation, healthcare, and automotive electronics business fields in Asia and South America.
- During the "EARTH Stage" we will continue expanding business in Asia, but we will also to achieve further growth by moving into emerging markets in other areas.
Target: sales revenue in emerging markets of 400 billion yen (FY2020)
3. Creating, fostering, and reinforcing new business
At OMRON, we refer to the trend from the pursuit of economic efficiency, business efficiency, and productivity to the pursuit of environmental considerations and mental/spiritual wealth as the "Optimization Society." We will identify the emerging needs of the Optimization Society relating to security, safety, health, and the environment; and create new business to respond to these needs in order to achieve long-term growth.
- During the "GLOBE Stage," we will expand and reinforce environment-related business fields, fields which are experiencing strong growth in demand.
- During the "EARTH Stage," we will further environment-related business and simultaneously focus on new business relating to fields such as societal infrastructure and health to respond to the needs of "Optimization Society."
Target: sales revenue from new business- 100 billion yen (FY2020)
Over the next ten years, OMRON will accelerate business growth with the "Globe" and "Earth" perspectives and provide customers around the world new value. We will take on the challenge of achieving robust global growth.