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  • [Industry Forecast ’99] Fujitsu Striving to Boost Sales, Company Pres. Says
  • January 5, 1999 (TOKYO) — Fujitsu Ltd.’s sales in 1999 are projected to remain at about the same level as those of the previous year, despite the severe economic conditions, said Naoyuki Akikusa, president of Fujitsu.
    “We have made every effort to increase our revenues, including reorganization of overseas semiconductor plants in 1998,” he said.

    BizTech interviewed Akikusa about Fujitsu’s prospects for 1999.

    BizTech: What is the company’s sales outlook for the new year?

    Akikusa: In general, conditions in 1999 will likely be as severe as in 1998.

    Fujitsu’s sales in 1999 will remain at about the same level as the previous year, at best.

    Our main lines of businesses are divided into the four categories of Communication Equipment, Information Equipment, Semiconductors and Software/Services. We cannot expect significant increases in sales of communication equipment because capital investments by common carriers such as Nippon Telegraph and Telephone Corp. are somewhat bleak.

    However, Fujitsu can expect some sales growth in information equipment, mainly computers, in 1999. Sales to corporate customers depend on the outlooks of top management about their investments in information systems as well as the ability of salespeople to market various products. Also, demand for PCs among individual consumers will increase.

    Sales of software and services have been brisk. Because we released a new system building architecture called “SOLUTION VISION” in 1998, Fujitsu will enjoy fairly good sales in this field in 1999 as well.

    BizTech: What is Fujitsu’s focus in the software/service business in the new year?

    Akikusa: Fujitsu will continue to encourage and cultivate the skills of its employees.

    Talented employees are our main assets in this field. More than 10 years are needed to train a system engineer. Thus, the first few years of such training doesn’t bring immediate benefits. Fujitsu cannot expect to generate a steady stream of revenues without making strong efforts to train system engineers.

    BizTech: In the semiconductor business, Fujitsu posted a special loss in the first half of fiscal 1998 due to the reorganization of overseas plants. In addition, memory chip prices have been very low.

    Akikusa: The time may come when anyone can start a semiconductor enterprise if they have enough money to do so. If that is true, the capability of manufacturing semiconductors will no longer be a major added-value skill.

    Fujitsu is streamlining its plants so as to be prepared for greater competition.

    As for our production sites in Europe and the United States, Fujitsu implemented measures to tackle problems, taking local communities and people into consideration. We will continue to reorganize our businesses in Japan and overseas, when necessary.

    Fujitsu plans R&D; investments for fiscal 1999 that would match the level of fiscal 1998, or about 10 percent of total sales. Japan ranks second in R&D; spending, and Taiwan and Korea are growing rapidly. Japan has much work to do in R&D.;

    BizTech: Is Fujitsu taking adequate measures to expand sales in growth fields as well as areas where there is only slight growth?

    Akikusa: Yes. I think we have done all that we can do. Because of the sluggish economy, we need to prepare for the future without cutting back, to take large steps to enjoy future successes.

    BizTech: Fujitsu is collaborating with Toshiba Corp. in development of the most advanced 1Gb DRAM device. Would Fujitsu consider sharing the role of product distribution with other makers, and do you have any plans to do so with other Japanese producers of microchips?

    Akikusa: No. In any business field, each company has its own way of doing business. Companies cannot simply close businesses that have been long sustained. It’s impossible to carry out such large-scale reorganization.

    BizTech: Fujitsu is reforming its personnel management system. Is the company making progress?

    Akikusa: We will continue to make strong efforts to advance this reform program.

    BizTech: Does Fujitsu have any plans to change its management system, for example, by introducing executive management systems as in European and U.S. companies?

    Akikusa: No. In fact, I don’t understand the difference between the executive management system and the business division system.

    Companies do not operate in the ‘form’ of an organization. Rather, companies need an ‘organization that can flexibly reform itself’ to quickly cope with business requirements that will change rapidly.

    Fujitsu’s strength is our top management’s swift approach to decision making.

    Related stories:
    ¥ Toshiba, Fujitsu Cooperate in 1Gb DRAM Development
    ¥ Fujitsu’s FY98 Interim Ordinary Profit Plunges 88 Percent

    (BizTech News Dept.)



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