Oki Electric Industry : Innovation Strategy

OKI Group

Innovation and Technology Strategy Meeting

Innovation Strategy

Yuhiko Fujiwara

Executive Officer

Chief Innovation Officer

Responsible for Innovation Business Development Center

November 16, 2023

© Copyright 2023 Oki Electric Industry Co., Ltd.

Contents

01

02

03

04

Entering New Business Domains

Full Participation Innovation

Creation of Future Businesses (Four Focus Domains)

Summary

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01

Entering New Business Domains

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01 Entering New Business Domains

(Billions of yen)

Social Issues

		Innovation Domains (incl. Global)
			¥50.0-100.0bn
		Pursuing New	• Logistics
		• Advanced Remote
		Businesses
		Operations
			• Healthcare / Medical	Growth
			• CFB
			Businesses
			Existing Domains
450			(new)
			Existing Domains	Core
			Businesses
FY2019	FY2022	FY2025	FY2031
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01 Future Trends: 2031 Market Trends

• Creation of customer value across domains and optimization of whole society through data distribution and integration
• Accelerated commercialization of remote operations utilizing a variety of sensors, robots, and mobility to complement labor shortages

Transportation		Logistics	Distribution
Low-carbon,congestion-free,	Multimodal	Route optimization,	Automation of last mile,	D2C
transportation
traffic congestion control,
and safe transportation	services
green logistics

Road and traffic monitoring

by robots

Healthcare / Medical care Retail warehouse

Data distribution and integration	Health	automation
management
Cross-domain	Treatment
customer value creation
apps

			Social sensing of	Drone delivery
			Emergency transport
			disaster information
			for outlying islands Smart factories
				personal
				Automation of retrofitting
				health records
		Drone and robot	EV	Wide-area monitoring and
Advanced use of	Structural maintenance	stations	batteries	disaster prevention services
renewable energy	with drones		Disaster
Infrastructure	Use of	Manufacturing
satellites	Prevention

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01 OKI's Target Business Domains

OKI Businesses: Existing, New, and Cross-Domain
Existing Domains	New Domains
Transportation	Regional	Logistics
Rail, air, public	Local government	Warehousing, freight
transportation, traffic	bodies, firefighting,	forwarding
information systems	flood control	(land/marine), other
		services
Manufacturing	Construction	Healthcare
Infrastructure
	Electricity, gas,	Health, exercise
Smart factories,	diet, medical,
water, roads,
EMS/DMS	care services,
bridges
	pharmaceuticals
Finance/	Ocean
Distribution
ATMs, sales	Defense,
branches, payment
underwater
terminals, cash
acoustics, marine
processing machines,
data, infrastructure
printers
Cross-Domain Businesses
Advanced Remote	Reduction of
Operations	CO2 Emissions
Remote monitoring,		Cross-domain
operation,	Direct and indirect	businesses not tied
maintenance, security,	decarbonization	to any specific
domain
facility management	contribution services
automation

Cross-Domain through data utilization
	Domains
Transportation/ Manufacturing Distribution	Disaster	Infrastructure	Ocean	Healthcare
Logistics	Prevention
Logistics: Improving Delivery Efficiency
Logistics: Warehouse Enhancement		Ocean	Healthcare /
	Infrastructure Monitoring
Reduction of CO2 Emissions
	Medical
Engineering Chain
Advanced Remote Operations
	CFB

OKI's Strengths

High-Grade Network				Real-Time Interaction
Value Creation through Multi-Linkage
Toughness			AI			Data Management

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01 OKI's Target Business Domains (Domains Where Capital Will Flow)

• Business creation in four domains (logistics, healthcare/medical care, advanced remote operations, and CFB) where capital will flow in 2031
• Aiming to expand business with an edge platform that leverages "market growth potential X OKI's strengths"

OKI's Future Business Targets (Four Focus Domains) / Focus Domains for Innovation

High

2
Technological	Med.
Advantages	Low

	Ocean	• Expansion of industry-academia
		collaboration and co-creation
Infrastructure	¥1.08 trillion •
Collaboration with startups	CFB
Monitoring			•	Open-close strategies, etc.
¥1.6 trillion							¥16.0 trillion
	Focus Domains				Advanced
Immature Domains				Remote
				Operation
("Pink Ocean")		Healthcare/	¥3.0 trillion Logistics
	Enhancement
	Medical care		Shipping
	of		Efficiency
	Logistics	¥5.9 trillion
	Warehouses	¥5.8 trillion
Engineering Chain	¥2.3 trillion
Market entry through co-creation with partners
¥530.0 billion

Reduction of

CO2 Emissions

¥2.6 trillion

Low

Med.

High

1 Growth potential due to market changes

*Circle size represents the market size forecast for 2031. **Circle position is based on current simplified estimates.

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02

Full Participation Innovation

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02 Creating Future Businesses: Value Creation Strategies

• Strengthen sources of value both externally and within the company

	Internal strengthening			Solving social and
			customer issues
				Business model transformation
	Company-wide innovation activities to				Edge solutions using AI and IoT
	promote DX

Full Participation	Edge Platform
Innovation	• AI Edge Computing
• Yume Pro activities	• Data management
• IMS(ISO56002) adoption and expansion	• Solutions in each area
• Implementation and globalization

	Organizational transformation	Creation of new solutions
	Productivity			Competitiveness
strengthening					improvement
	Operational process transformation	Enhancement of existing solutions
	Strengthen Mono-zukuri infrastructure			Products and services to
	to become manufacturing platformer			help customers DX
	Strengthening			Shift to front-office processing
	Mono-zukuri infrastructure			• New IoT Products
	• Virtual One Factory			Business process services
	• Portability, smart factories
	• Environmental measures (ZEB/ZEF)			• Comprehensive Mono-zukuri services
			Business process transformation	• Recurring/ BPO services

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02 OKI's Vision for the Future

Number of innovations created

All members willingly take on the challenge of innovation and "Delivering OK! to your life."

FY2025 Quality and quantity

improvement of results

Acquisition of

IMS certificate

Accelerate

FY2023 practice mode

Full-scale IMS operation

Contribution to global society

FY2031

Sustainable growth

IMS penetration

Acting with IMS in mind

Growth of "swimmers who can make it to the finish"

Acting on a global scale

*Innovation Management System (IMS): A management system that promotes innovation at companies and other organizations.

**"Swimmers who can make it to the finish": A team of strong-willed innovation practitioners who continue to drive the innovation process.

***Number of innovations created: Number of companywide innovation projects that have progressed to the solution implementation step.

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