Hitachi, Ltd.(NYSE:HIT) today announced that the company is currently carrying out
reforms to establish a management system enabling optimum response to the realities of an
era of global megacompetition and full-scale consolidated management. In line with this, the
company has now resolved to implement the following system for conducting its business.
1. Reformation of Hitachi, Ltd.'s business system
(1) The present five groups and two divisions are to be reorganized into eleven business
divisions, the number determined as optimum through a study of all relevant factors including
best scale for quick response to changing market conditions and the nature of the company's
business. To speed up all aspects of business operation, each business division will be
essentially an independent company encompassing affiliated companies with closely related
businesses. Division management decisions will be made by a "division management
committee" under the division CEO.
(2) A sweeping organizational and functional restructuring and streamlining of the head office
will be undertaken and the role of the head office staff will be sharply defined. Specifically,
personnel required for management functions and the minimum functions required by a
corporation will be defined as the "corporate staff." The corporate staff will be kept to the
minimum number of personnel required. Personnel needed to provide the business divisions
with indispensable services of a high-level technical nature will be defined as the "business
staff." The size of the business staff will be adjusted based on the needs of the business
divisions.
(3) These changes will be implemented from April 1, 1999.
2. Reformation of Hitachi Group's business system:
For full-blown consolidated management, the "Hitachi Group Committee" has been
established as a forum for discussing issues related to consolidated management, with the aim
of increasing the international competitive power of the Group. The first meeting of the
Committee will be held on October 20, 1998.
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