Accomplishments and Issues during the First Year of the Medium-Term Management Plan
Three strategies are being implemented in the medium-term management plan: (1) Increase development capacities globally (2) Implement development process reforms, and (3) Increase the output of new technologies and the creation of new businesses. Though the first fiscal year included some delays, measures mostly proceeded according to plan.
In terms of “Increase development capacities globally,” we opened R&D centers in North America and established global development capabilities for software. When the new software development location was being established in India, a task force was formed, composed not only of personnel from relevant divisional departments but also from corporate administrative departments, including Human Resources, Legal, and Corporate Strategy Planning Departments, to start creating the operating systems for the facility. This collaborative approach initially generated some uncertainty but ultimately resulted in establishing organizational and other capabilities much more quickly than expected. This approach will also be deployed globally, beyond India.
Regarding “Implement development process reforms,” we created rules for agile development practices. Though progress was made in establishing rules, there were also delays in releasing some products to market. Therefore, we intend to achieve more timely new product development by speeding up agile development processes.
For “Increase the output of new technologies and the creation of new businesses,” we proposed business models based on IP landscape analysis, built a Shimadzu version of an innovation management system, established the Corporate Venture Capital (CVC) fund, and invested in five startup companies. In particular, IP landscaping is being used to assist development, such as by utilizing patent information for big data analysis and for investigating customer needs, competitor trends, and other market conditions. Initially, we expected to conduct a few investigation and information provision projects per year, but we implemented about 50 projects in FY 2023. In the future as well, we will continue to actively provide support for not only products but also creating business models.
Second-Year Measures for the Medium-Term Management Plan
Continuing from the first year, we will implement three strategies during the second year. In terms of “Increase development capacities globally,” we will focus efforts on quickly getting the North America R&D Centers, which were launched in April 2024, operational and running smoothly. By establishing centers on both the East Coast and the West Coast, where many pharmaceutical companies and research institutions are located, we will be able to work closely with key customers to identify their needs and challenges and jointly develop products. If we cannot offer solutions on our own, another important role of the R&D Centers will be to collaborate with other companies or research institutions in North America that possess remarkable technologies. We assume that the products and software/applications that satisfy global companies in North America will also meet the needs of customers in Europe, Asia, and other regions. Therefore, the products/applications from North America will also be deployed throughout the world. In the future, we aim to implement similar measures as in North America to establish R&D centers in Europe, Asia, and other key locations.
For “Implement development process reforms,” we will further establish agile development methods for achieving more completed development results while also incorporating customer feedback. In addition, digital technologies will be used to increase the efficiency of design and prototype evaluation operations. In order to listen to a broader range of customer feedback, the sales organizations of each business segment were integrated in FY 2024 and transitioned to a Sales & Marketing Division-based organization. We intend to use the new organization to work more closely with customers in order to offer end-to-end solutions for customer challenges.
Regarding “Increase the output of new technologies and the creation of new businesses,” we will actively use the CVC fund to support startups and ensure they generate growth for Shimadzu Group products and services or result in new businesses. Even if synergies cannot be expected in the short term, industry contacts via the startups can lead to technical collaborations, business opportunities, or other benefits. In addition, the process of screening startups that have unique technologies based on their future potential will enhance our ability to judge new technologies and new businesses.
Furthermore, we will promote offering end-to-end solutions by expanding the product lines and improving the basic performance levels of key models (liquid chromatographs, mass spectrometer systems, gas chromatographs, testing machines, and turbo molecular pumps), by increasing the automation and autonomy of pretreatment and other processes, and by utilizing AI technologies.
Valuing Technology and People as a Source of Strength
The current medium-term management plan specifies increasing our technology development capabilities. In particular, we intend to focus efforts on developing mass spectrometer systems, which are considered core products. The demand for mass spectrometer systems is particularly increasing for healthcare and green transformation applications, such as drug development, food safety, clinical testing, and environmental testing, which are areas where the Shimadzu Group is focusing efforts. More recently, in addition to higher performance, customers are also seeking higher operating efficiencies for analytical operations. We hope that pursuing not only core performance capabilities, of course, but also using AI or automation functionality to achieve operating efficiency improvements, will contribute to the advancement of society.
Personally, my current focus is on quantum technologies, such as optical lattice clocks. Using the ultra-accurate optical lattice clock being developed in collaboration with Professor Hidetoshi Katori of The University of Tokyo Graduate School of Engineering, it was possible to observe the slight difference in the progression of time between the ground floor and observatory level of the Tokyo Skytree tower, based on the Theory of Relativity and the difference in gravitational forces. I think this technology represents an opportunity to provide a major contribution to society. We also have high expectations for quantum metrology and have been focusing development efforts on that technology.
The Shimadzu Group has always had a culture of valuing developed technologies even if they cannot be immediately applied to products and services. Consequently, Shimadzu is able to quickly develop applications for such technologies whenever society needs them. That accumulation of diverse technologies is a key strength of the Shimadzu Group.
Providing an Environment for Generating Innovation and Increasing Technological Capabilities
Founder Genzo Shimadzu built the foundation for the Shimadzu Group and achieved growth based on open innovation.
Though Shimadzu has been generating innovation for a long time since then, one problem is that engineers and researchers have not necessarily been aware of their innovation. Therefore, in order to foster a culture of innovation, we must increase everyone’s awareness of innovation, so that translating day-to-day research and development work into innovation is considered a matter of course and innovation is generated routinely. To achieve that, I want to provide an atmosphere and opportunities that allow engineers and researchers to have fun actively engaging in their work. Therefore, we will implement measures to improve branding based on technology, such as by highlighting the fact that Shimadzu Group technology is used in brewing craft beers and Japanese sake or the fact that Shimadzu designs achieved significant recognition at an international design event, for example. I want to promote activities for increasing employee engagement in terms of technology, so that Shimadzu technologies are widely admired throughout the world and each employee can feel proud of them.
Cultivating human resources and preparing the soil for continuously increasing and improving our technologies will lead to continuous increases in corporate value. Expect great things from Shimadzu as we contribute to society through science and technology.
Biography of Hiroto Itoi, Managing Executive Officer, CTO
| Apr. 1984 | Joined Shimadzu Corporation | |
| Jun. 1996 | Research & Development Department, Analytical Instruments Division | |
| Apr. 2001 | General Manager, MS/GC Business Unit, Analytical Instruments Division | |
| Jun. 2011 | General Manager, MS Business Unit, Life Science Business Department, Analytical & Measuring Instruments Division | |
| Jun. 2017 | Deputy General Manager, Analytical & Measuring Instruments Division and concurrently General Manager, Life Science Business Department | |
| Apr. 2018 | Corporate Officer, Deputy General Manager, Analytical & Measuring Instruments Division and concurrently General Manager, Life Science Business Department | |
| Apr. 2020 | Corporate Officer, General Manager, Technology Research Laboratory | |
| Apr. 2022 | Managing Executive Officer, CTO (current) |
