Medium Term Management Plan

Issues on Mid-to Long-Term Management

1. Accelerate the global expansion of existing businesses; capture demand in emerging markets, placing stronger priority on greater Asia; improve profitability and strengthen our business foundation.

2. Strive to expand business, increasing market share with a sales strategy tailored to each market, including increasing market share by bolstering marketing capabilities, product planning capabilities, and sales capabilities, and providing products that move customers emotionally in response to marketing trends and customer needs.

3. Aim to expand business fields by expanding existing businesses and developing New Eyes for Industry through the reinforcement of marketing aiming at resolving social issues and joint creation, including through M&A.

4. Provide timely new products tailored to customers and the market by reinforcing the global development structure and reducing the lead time from development to high-volume production, thereby responding to the swiftly changing operating environment.

5. Construct a global trilateral system for efficient production and promote increased productivity and cost reductions through smart factory automation, labor saving and manpower saving, among other means, with the fourth industrial revolution in mind.

6. In addition to the development of component technologies, especially the Company's core optical technologies, focus on research and development in new technical fields, the joint creation of new values and other horizontal operations among multiple companies (including collaboration among government, industry and academia).

7. Realize sustainable growth by strengthening corporate governance to enhance the effectiveness of strategies/tactics.

8. Create a workplace environment where all employees can maximize their potential, in order to improve work-life balance, promote diversity, and develop employee talent.

9. Curtail greenhouse gas emissions and promote recycling as climate change countermeasures to help achieve a sustainable global environment.

Mid-Term Management Plan and Current State of Progress

The Group formulated in February 2018 the Medium Term Management Plan for the period until the fiscal year ending December 31, 2020 and aims to achieve its targets.The Group also set an ROE target in consideration of the capital cost and other factors.

Consolidated financial results

Sales Target by Segment

The Value Creation Process

Agendas for Transformation

Action Plan
Reinforce Sales & Marketing
・Enhance Marketing Functions
・Proposal-Based Sales Activities
・Enhance proposal-based sales activities
・Create pull-demands and increase repeat customer rate
Customer Values
・Innovative & Exciting Product Planning ・Reinforce functions of Product Planning Dept. (from product planning to launch)
・Establish mechanism to feed market needs to product planning
Globalization of Sales, Production, & R&D
・Re-Organize Sales Network
・Re-Organize Manufacturing Process
・Expand territories covered by US subsidiary
・Realignment of sales network in Asia
・Initiate R&D for CCTV Lens in China factory
・Optimize use of 3 factories (JPN/CHN/VNM)
Re-Building of R&D Process
・R&D Investment in Future Business
・Shorten R&D L/T
・Start full-scale operation of Opto-Science R&D Center
・Increase efficiency in R&D process
New Business Development
・Operational & Capital Partnership with External Organization ・Build partnership with external organization
・Selection and concentration of resources
・Leverage alliances and M&A
Corporate Management
・Organizational & HR System Restructuring
・Enhance Corp. Governance
・Flatter & slimmer organization structure (integration of Imaging Products Biz. Unit)
・Review HR evaluation system
・Build suitable corporate governance system
・Efforts to improve productivity in each dept.