■Hagiwara Electric Holdings' Medium- to Long-Term Growth Strategy ＜7467＞
4. 6 priority strategies
(1) Device business strategy
As a basic business policy, we aim to improve the profitability of growth businesses while expanding the scale of basic businesses using production materials (semiconductors/electronic components) and contract business. As for the basic business, we will achieve continuous growth by expanding the area of proposing and providing services, etc. that are close to customer issues through a deep understanding of car devices and systems and high-quality technical support. As for growth businesses, we will develop and expand solution-type businesses, build highly profitable business models by creating new value, and strengthen “earning power.”
(2) Solution business strategy
The basic business policy is to promote businesses with high profit margins through solving social and customer issues and creating value, establish a fusion business utilizing the strengths of the three existing businesses, and challenge the further expansion of new markets and high value-added businesses by launching a data platform business as the fourth pillar.
By fostering services and technologies that can be used in a wide range of industries based on manufacturing, and further refining the business model, we aim to be an engineering company that supports future site development through data utilization. Specifically, we will promote the realization of manufacturing DX through integration capabilities, contributions to customer value creation through new embedded solutions, and creation of new added value for companies through data utilization.
(3) Business innovation strategy (new business/co-creation activities)
As a basic business policy, we have set out business creation/expansion/development based on a deep understanding of the mobility area typical of the company group, and promotion of value-added innovation (emergence) through synergy within the group and collaboration with other companies' businesses.
Specific measures include discovering business opportunities for value-added products utilizing wholesale model expansion, discovering engineering businesses utilizing understanding of inspection/in-vehicle planning areas, and promoting vertical integration and horizontal industrial expansion of applications through network construction/data utilization.
(4) Strategy for improving business management
As a basic business policy, we aim to improve operation efficiency and optimize management resources by promoting IT/DX, and accelerate efforts aimed at shifting to a management style that is conscious of capital productivity.
“MNV2023” has promoted the establishment of DX promotion activities, the advancement of the system infrastructure, the sophistication of operations, and the strengthening and speeding up of the group management infrastructure. In “MNV2026,” we will accelerate growth by visualizing data and speeding up decision-making by constructing IT infrastructure, speeding up decision-making processes by constructing investment decision schemes, and strengthening supply chain management through standardization/efficiency of logistics management and proper inventory management, etc.
(5) Human resources strategy
As a basic business policy, we aim to maximize challenge and performance by implementing human capital management. In other words, we aim to maximize the power that all employees can have with human capital management that makes use of the strengths of “people” typical of the company group.
We aim to improve corporate value by challenging innovation (= shinka) with everyone's participation. Specifically, each person will challenge the following “3 My Innovations” (= 3 Shinka).
Innovation: A novel innovation that has shaken off
Evolution: bold and bold innovation
Deepening: Steady innovation with a foothold
Note, in this process, only general employees play a leading role in creativity and challenge, managers drive innovation, and management plays a role in promoting the creation of an environment for innovation.
In addition, KGI for personnel strategies and priority strategic themes are determined, and corporate value is improved by promoting “promotion of challenge and transformation” and “work design reform.” “Talent Management,” “Diversity, Fairness & Inclusion (DFI),” “Activity Based Working (ABW),” “Health Management,” and “Compliance” are defined as priority strategic themes, leading to the promotion of innovation.
(6) ESG promotion
As a basic business policy, we have set out continuous efforts and deepening utilizing the results and activities of “MNV2023.” Specifically, in addition to accelerating internal environment improvements that support human resource growth and innovation creation, we will also search for responses and responses to new sustainability themes.
Furthermore, we aim to “deepen sustainability management” by implementing the following measures as a challenge theme.
・Scope 1 and 2 reduction targets (reduction of 25% or more compared to the fiscal year ending March 31, 2021)
・Revitalizing SDGs activities through the creation of open innovation
・Human resource growth through the practice of human capital management
・Promotion of human rights due diligence
・Enhancing ESG information disclosure
・Strengthening corporate governance
5. Counting Targets
We will expand our business scale and actively invest in new profit models, and aim for sales of 300 billion yen and operating income of 11 billion yen for the fiscal year ending 2027/3. Also, on the financial side, we will accelerate scale expansion and growth investments with appropriate financial leverage, and aim for an ROE of 11% or more. In order to achieve this, the policy is to change the standard dividend payout ratio from 30% to 30-40%, and stable dividends will be carried out after taking into account the net asset dividend ratio.
(Written by FISCO Visiting Analyst Noboru Terashima)