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  • [Industry Forecast ’99] Compaq Computer Japan Seeks Double-Digit Profit Growth, Pres. Says
  • January 7, 1999 (TOKYO) — In line with the strategy of its U.S. parent Compaq Computer Corp., Tokyo-based Compaq Computer K.K. has been transformed into a comprehensive computer maker by acquiring Tandem Computers Japan Ltd. in June 1998 and Digital Equipment Corp. Japan in October 1998.
    BizTech interviewed president Hajime Takayanagi and inquired about targets for 1999. Takayanagi formerly headed Tandem Japan, which had slightly more than 400 staff members, and he now supervises a huge business with 3,300 employees.

    BizTech: What type of business environment do you expect in 1999?

    Takayanagi: I think that business will be in a gradual upward trend from June, in view of the overall Japanese economy. We can count on positive effects of the government’s economic measures, such as the tax cut and massive public fund injections into ailing financial institutions.

    However, an actual economic pick-up can be expected only after the stabilization of Japan’s financial system. This will take a little longer. On the other hand, should the series of the government’s economic measures fail, the Japanese economy will be in uncontrollable chaos.

    Investments in information systems are expected to increase when the economy is on an upward trend. Business customers are in a state in which they are unable to invest in information systems even if they wanted to do so. In order to realize strategic management, maintenance and utilization of information systems it is essential that data warehouses be used on a practical basis.

    A second look needs to be given to enterprise systems. However, business users still remain unable to invest adequately in information systems because they are constraining overall investments.

    In view of Compaq’s sales, the growth of orders for NonStop Himalaya, Alpha Server, and large-scale servers such as ProLiant Server is favorable. We are told that customer companies wish to invest much more, but they can’t in reality.

    Because users are unable to invest enough, they are utilizing inadequate systems after adding hardware and software to existing systems instead of fully reconfiguring their systems. Also, users are forced to put up with less powerful systems. If the economy starts to pick up, all major customers will likely step up their investments in information systems.

    BizTech: What is the target of Compaq Japan?

    Takayanagi: We seek to gain a larger market share in every field and to fully reconstruct the profit structure of our core business. The target is for double-digit growth both in sales and profit. To achieve these goals, we are working quite hard.

    For example, in the personal computer sector, the sales method will be reexamined, and the supply chain management system will be completely reviewed. We seek to realize a shorter delivery period by reducing inventories, and in turn to restructure the earnings structure.

    “Customers, customers, customers” is our slogan for 1999. “Cherishing customers” is necessary throughout our organization.

    Of course, Compaq, DEC Japan and Tandem Japan have always valued their customers. But that is not enough. This year, we plan to go back to the basics of the computer business and to promote a truly user-based business.

    Also, Compaq will compete by taking advantage of our “comprehensiveness” as a weapon. We intend to deploy strategies ahead of competitors on the basis of the solid management that has been built through integrating Compaq, Tandem Japan and DEC Japan. While placing the highest importance on users, we will take full advantage of the “comprehensiveness” of the former three companies.

    Related stories:
    ¥ Compaq Japan to Speed Supply Chain Mgt. System Implementation
    ¥ Compaq Computer, DEC Japan Announce Overall Product Plans
    ¥ Compaq to Inherit Service Unit from Digital Japan

    Click here for more New Year features.

    (BizTech News Dept.)

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