INDIVIDUAL ASSIGNMENT

MANAGEMENT OF POLICY AND STRATEGY

X XXXXXXXX

DMGWEFXXXXX

EN AHMAD SOBRI ISMAIL

INTRODUCTION
2010 will mark a significant milestone in Hitachi's history as our centennial. At a time when

Japan was focused on achieving rapid modernization through the widespread introduction of
technology from Europe and the United States, Namihei Odaira founded Hitachi with the

goal of promoting technology developed in Japan. We refer to this founding philosophy as

"The founding spirit of Hitachi," a heritage that lives on, embodied in the words "Harmony,"

"Sincerity," and "Pioneering spirit." This Hitachi spirit is very important for us even in this

day and age.

The Hitachi Group includes many business divisions, companies, many technologies,

products and solutions. Nowhere else in the world is there another business group that has

such a broad range of diversity. And despite the current unprecedented economic crisis,

Hitachi will continue to expand its businesses through global social innovation by focusing

on the "creation of environmental value." At the core, this underscores Hitachi's founding

philosophy of promoting business strongly and continuously in order to thrive at a steady

pace toward the future. This is what truly differentiates Hitachi from all other competitors.

Hitachi truly embodies our corporate statement "Inspire the Next" (breathe new life into the

next era) by combining "the collective strengths" of the wide range of businesses,

technologies and expertise within the Hitachi Group to generate the optimal value for the

diverse issues among customers and society at large.

Hitachi's goal is to achieve further growth by looking back to its origins. It is critically

important to engage the heart and mind of each and every employee and remind them of our

corporate philosophy of "contributing to society through the development of superior,

original technology and products." In today's unprecedented economic crisis, which has

dramatically changed and changes daily we must be prepared to take immediate action and be

ready to respond quickly to our changing society.

 COMPANY

BACKGROUND
Hitachi Ltd. (Kabushiki-gaisha Hitachi Seisakusho) Hitachi is a Japanese multinational

corporation specializing in high-technology and services headquartered in Marunouchi

Itchome, Chiyoda, Tokyo, Japan. The company is the parent of the Hitachi Group (Hitachi

Gurūpu) as part of the larger DKB Group companies. On the 2007 Forbes Global 2000 list,

Hitachi was ranked number 371.

Hitachi was founded in 1910 as an electrical repair shop. Today, it is one of the leading

manufacturers in new technology. Hitachi Works is the oldest member of the Hitachi

Group and consists of three factories: Kaigan, Yamate, and Rinkai Works. Yamate Works,

the oldest of the three factories, was founded in 1910 by Namihei Odaira as an electrical

equipment repair and manufacturing facility. This facility was named Hitachi, and is regarded

as the ancestral home of Hitachi, Ltd.

Many management trainees intern at Hitachi Works before being permanently assigned to

other Hitachi divisions. Senior management personnel are often participants in rotations at

Hitachi Works for a few years as their career develops towards eventual head office stature.

As a result, many of the senior managers of Hitachi Ltd have passed through Hitachi Works.

Spin-off entities from Hitachi Works include Hitachi Cable (1956) and Hitachi Canadian

Industries (1988). In 2007, Hitachi won the Investment in People Award, Asia Pacific

Entrepreneurship Awards from Enterprise Asia, a regional NGO based in Kuala Lumpur,

Malaysia for their continued efforts in building human talents.

CORPORATE
INFORMATION
• BRAND STATEMENT

• about “Inspire”

The word "inspire" has as its etymology, the Latin preposition in and the Latin verb

spirare, meaning "to breathe." As well as meaning "to breathe in," and "to encourage," it

also has various meanings associated with life itself, such as "to uplift the spirit" and "to

invigorate."

• “the Next”

Nothing was put after the word "Next" in order to inspire our stakeholders and all those

that read our Corporate Statement to imaginatively fill in the blank that follows with a

word like "Era," "Society," "Idea," "Product," "System" or "Solution."

Having others share in the composition of our Statement is one its primary aims.
• VISION

Hitachi Group is doing business in various fields from social infrastructure to home

appliances, materials, logistics, and services. We will always breathe new life into the

next era under a corporate statement "Inspire the Next", aiming at becoming a vigorous

company that continuously grows in the 21st century and contributes to prosperous and

comfortable society.

• MISSION

We represent leading global manufacturers of construction and mining equipment

• We aim to satisfy our customers’ needs through guaranteeing efficiency and quality in

all aspects of our business activities

• We help our customers to perform their job more safely, ecologically and

productively, thus contributing in creating better places for people to live in

• We can continue to exist only because we are better at performing and improving our

processes than anybody else

• We require our profit to grow steadily for satisfying all our stakeholders who supply

us with various resources

GUIDING PHILOSOPHY

Customer satisfaction

• We provide our customers with reliable products of lasting value and dependable

services

• We are committed to make any effort to ensure and enhance customer satisfaction

• We promptly and accurately respond to a wide variety of customers’ requirements

• We are eager to know about our customers and their needs better than competitors

• We are keen to know whether our customers are really satisfied with our products and

services

• We make continuous efforts to integrate customer’s needs and market requirements

into our product development and quality improvement

People

• Our people are the source of our strength

• Success of our company relies upon the enthusiasm, commitment, expertise,

professionalism, creativity and challenging spirit that is in every individual

• Every individual makes efforts to improve the capabilities required for the job

• Our company supports and encourages such efforts by providing an appropriate

working environment

• We are a team

• We treat each other with respect and trust

• We communicate openly and sincerely based on facts, using quantitative expressions

when possible to ensure the effectiveness and objectivity

• We coordinate closely with each other to make sure we are working towards the same

targets

• We cooperate with each other to combine each individual’s potential power to achieve

the best results

• We contribute to each other’s activities to enjoy together the rewards of our efforts

Total Care

• To achieve customer satisfaction quality, health and safety and environmental care

must be our first priority

• Total care is the result of our efforts to satisfy needs of those within or outside our

company who receives output from any of our business processes

• Every individual takes responsibility for the output and continuously strives for

excellence in quality of the product, to reduce energy consumption and waste

production and to maintain a safe and healthy working environment

• We recognize that every process is interrelated

• We practice good communication and close cooperation to integrate our efforts for

total care improvement

• We regard innovation as the key for continuous improvement our total care system

Challenge for changes

• We are living in the age of rapid changes

• We seize opportunities arising from the changes in our business environment

• We proactively change the way we conduct our business to get ahead of change in the

world

• We boldly try new ideas with organized dynamism, taking carefully calculated risks

ORGANIZATION STRUCTURE
Representative Executive Officer, Chairman,

President and Chief Executive Officer

Board Director
Tadamichi Sakiyama
(Chairman)

Director Yoshie Ota

Mitsuo Ohashi

Kenji Miyahara

Takeo Ueno

Shungo Dazai

Tohru Motobayashi

Takashi Miyoshi

COMPANY’S BUSINESS

STRUCTURE
 • Main products and services
Hitachi divides its operations into seven industry segments. These segments are listed below

with the main products and services offered by each. The figure in parentheses shown with

each segment is the percentage of total revenue (for the fiscal year ended March 2007)

derived from that segment.

Information and Telecommunication Systems Electronic Devices (11%)

(21%)
 LCDs
 System integration  Semiconductor manufacturing equipment
 Outsourcing services  Power tools
 Software  Test and measurement equipment
 Hard disk drives  Medical electronics equipment
 Disk array subsystems  Semiconductor devices
 Servers
 Mainframe computers
 Personal computers
 LCD projectors
 Telecommunications equipment

 ATMs

Power & Industrial Systems (26%) Digital Media & Consumer Products (13%)

 Nuclear, thermal and hydroelectric power  Optical disk drives

plants  Plasma and LCD Televisions
 Industrial machinery and plants  LCD projectors
 Automotive products  Mobile phones
 Construction machinery  Room air conditioners
 Elevators  Refrigerators
 Escalators  MP3 players
 Railway vehicles (see Hitachi Rail)  Washing machines
 Bread machines
 Vibrators
 Information storage media
 Batteries
 Air conditioning equipment
High Functional Materials & Components (15%) Logistics, Services & Others (10%)

 Wires and cables  General trading

 Copper products  Logistics
 Semiconductor materials  Property management
 Circuit boards and materials
 Organic and inorganic chemical products
 Synthetic resin products
 Display-related materials
 Specialty steels
 Magnetic materials and components
 High grade casting components and materials

Financial Services (4%)

 Leasing
 Loan Guarantees
 Insurance Services
 Invoice Factoring
 Invoice Finance
 FUTURE PLAN AND COMPANY STRATEGIC

ROLES
Long-term Plan ‘Environmental vision 2025’ to Combat Global Warming.

Hitachi, Ltd. announced in a drive to promote environmental preservation and realize a

sustainable society, the Hitachi Group has drafted a long-term plan called Environmental

Vision 2025. Through this plan, the Group is determined to curb CO2 emissions associated

with its products by 100 million tons in fiscal 2025. Two factors spurred the formulation of

this plan. One was recognition of the importance of developing decisive measures for

meeting the target of halving greenhouse gas emissions worldwide by 2050.

This target emerged from discussions among heads of state and government at the

Heiligendamm Summit of the Group of Eight (G8) leading industrialized nations that took

place in Heiligendamm, Germany, in June 2007. The second factor behind this decision was a

desire by the Hitachi Group to devise a concrete plan of action running through to the

midpoint of this target period, fiscal 2025, and to strengthen environmental initiatives on a

Group-wide level. Meanwhile, in order to step up promotion of Environmental Vision 2015, a

medium-term plan drafted in fiscal 2006, and to successfully meet Environmental Vision

2025 targets, the Hitachi Group established the post of Hitachi Group CEnO (Chief

Environmental Strategy Officer) on December 1, 2007. As the name suggests, the CEnO is

responsible for coordinating and managing environmental management strategies for the

Hitachi Group. Accompanying this move, the Group will establish the Environmental

Strategy Office on January 1, 2008, as part of actions for achieving the goals of its

environmental plan.
The Hitachi Group has been implementing activities under the aforementioned

Environmental Vision2015. These activities aim to realize global warming prevention,

ecosystem conservation, and the sustainable use of resources. Under Environmental Vision

2015, the Group has been working to meet its fiscal 2015 goal of achieving "emission

neutral" status, whereby direct environmental impact and societal environmental impact are

reduced by the same amount. Direct environmental impact refers to energy used in

production activities, such as the acquisition of basic materials and processing and refining of

parts; greenhouse gases emitted from factories; and energy used for recycling waste and for

transportation. Societal environmental impact, meanwhile, refers to electricity consumed by

products, as well as energy used for recycling end-of-life products. As a new target for

successfully completing Environmental Vision 2015, the Group has declared its commitment

to increasing sales of its Eco-Products* to ¥6.6 trillion by fiscal 2010, or roughly double that

recorded in fiscal 2006.

The Hitachi Group formulated the Environmental Vision 2025 long-term plan to provide

fundamental solutions for realizing a truly sustainable society. The key concepts of the plan

are outlined below.

1. Further promotion of the Environmental Vision 2015 medium-term plan

• The Hitachi Group will step up activities implemented under the ongoing Environmental
Vision 2015 medium-term plan as part of the Environmental Vision 2025 long-term plan. In
the push for early attainment of the fiscal 2015 goal of achieving "emission neutral" status,
the Group will reduce direct environmental impact through investments in energy
conservation and the switch to alternative fuels. At the same time, the Group will work to
expand the proportion of net sales accounted for by Eco-Products. As a specific benchmark,
 the Group aims to boost sales of Eco-Products to ¥6.6 trillion by fiscal 2010, or roughly
double the fiscal 2006 figure.

2. Reinforce Global Warming Countermeasures

• The Hitachi Group is seeking further reductions in societal environmental impact, a key
element in attaining the "emission neutral" status outlined in Environmental Vision 2025. To
this end, the Group aims to curb CO2 emissions from its products by 100 million tons
worldwide by fiscal 2025.

3. Strengthen Environmental Businesses

• The Hitachi Group's environmental businesses are underpinned by the Group's collective
technological capabilities. Leveraging these skills, the Group is seeking to enhance the
environmental performance of its products on all fronts, from materials, parts and
components, to product design, systems, services and solutions. From this standpoint, the
Group seeks to expand and strengthen its businesses in a number of environmental fields. In
the area of global warming prevention, the Group will reinforce businesses related to both
power-generation and energy-saving products. In ecosystem conservation, efforts will focus
on investing in environmental equipment and water treatment systems. In the sustainable use
of resources, the Group will channel its investments into recycling and other businesses. The
goal is for Eco-Products to account for all Hitachi Group products sold by fiscal 2025.

4. Promote Collaborative Creation Projects on a Global Scale

• Developing products that meet the requirements of clients in every global region is a critical
component of business expansion and reinforcement. To answer this challenge, the Hitachi
Group is aggressively pursuing what it calls Collaborative Creation Projects with corporate
partners, government agencies, universities and other organizations worldwide. Projects
already under way include the global R&D task of developing technology for coal-fired
power generation with lower CO2 emissions, with joint research being undertaken with
universities in the United States and Europe. Another example is a model project being
conducted in cooperation mainly with China's National Development and Reform Committee
that seeks to develop energy-saving electrical systems in Yunnan Province utilizing waste
heat and pressure.
5. Strengthen Structure for Promoting Environmental Management
• On December 1, 2007, the Hitachi Group established the post of Hitachi Group CEnO (Chief
Environmental Strategy Officer). The CEnO is responsible for coordinating and managing
environmental management strategies for the Hitachi Group. In parallel, the Group will create
an Environment Strategy Office on January 1, 2008. Both moves are aimed at promoting
activities for achieving the goals outlined in Environmental Vision 2025.
 ANALYSIS ON COMPANY

PERFORMANCE AND ISSUES

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sustain differentiated P&L performance.

You can't dominate an industry with a better accounts payable system, inventory control

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and more predictive than your competitors, you will dominate with improved products,

channels, service, pricing, supply chain and workforce.

Hitachi Consulting, a recognized thought leader in BI, consistently delivers solutions that

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Management solutions address both your functional and cross-functional needs for:
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support your products and services more effectively

• Corporate Management (Finance, Information Technology, Human Resources, and

Strategy): Manage and run your enterprise more efficiently

• Supply Chain (Procurement, Manufacturing, Logistics, Social Responsibility):

Efficiently manage and optimize your supply chain

2010 will mark a significant milestone in Hitachi's history as our centennial. At a time when

Japan was focused on achieving rapid modernization through the widespread introduction of

technology from Europe and the United States, Namihei Odaira founded Hitachi with the

goal of promoting technology developed in Japan. We refer to this founding philosophy as

"The founding spirit of Hitachi," a heritage that lives on, embodied in the words "Harmony,"

"Sincerity," and "Pioneering spirit." This Hitachi spirit is very important for us even in this

day and age.

 CONCLUSION
The Hitachi Group includes many business divisions, companies, many technologies,

products and solutions. Nowhere else in the world is there another business group that has

such a broad range of diversity. And despite the current unprecedented economic crisis,

Hitachi will continue to expand its businesses through global social innovation by

focusing on the "creation of environmental value." At the core, this underscores Hitachi's

founding philosophy of promoting business strongly and continuously in order to thrive at

a steady pace toward the future. This is what truly differentiates Hitachi from all other

competitors. Hitachi truly embodies our corporate statement "Inspire the Next" (breathe

new life into the next era) by combining "the collective strengths" of the wide range of

businesses, technologies and expertise within the Hitachi Group to generate the optimal

value for the diverse issues among customers and society at large.

Hitachi's goal is to achieve further growth by looking back to its origins. It is critically

important to engage the heart and mind of each and every employee and remind them of

our corporate philosophy of "contributing to society through the development of superior,

original technology and products." In today's unprecedented economic crisis, which has

dramatically changed and changes daily we must be prepared to take immediate action

and be ready to respond quickly to our changing society.