Table Speech

Initiation Speech

November 21, 2012

Mr. Takashi Mitachi
Mr. Hiroshi Oura

Initiation Speech

Mr. Takashi Mitachi
Co-Chairman Japan, The Boston Consulting Group K. K.

Adaptability to Changes

 The so-called strategy consultants have initially assisted the decision-making on inter-enterprise competition and its implementation, within the academic framework of business management that diverted from social science, including microeconomics, sociology and psychology.

 Today, the main focus has shifted on how to enhance adaptability of organizations to various changes, as companies are exposed to environmental changes that unfold at astounding speed and scale. For example, ranking within an industry switches drastically in many sectors, due to increasing “changes” that are beyond the control of conventional business management ability. The “economics of scale” itself is no longer valid in some industries.

 Various factors underlie such “incessant changes.” What we are starting to witness recently is that multiple structural factors that generate dramatic environmental changes are getting interlinked. Business executives must bear in mind that these structural factors will last over several decades to come. I think there are three major currents underlying these factors.

 Firstly, the current of megatrend caused by demographic changes triggers shift from unipolar world led by the US to multipolarity, rapid progress of the emerging economies and consequent increase in geopolitical risk as well as various issues concerning sustainability.

 Secondly, the current of rapid ICT technological advancement is intensifying competition, even across different industries. The business model of horizontal division of labor or outsourcing also keeps evolving.

 Lastly, the current caused by the development of financial technology and instruments, represented by long-term monetary easing of developed nations and derivatives. Today, the financial markets are expanding at an astonishing rate, as various items are becoming financial commodities, including energies, CO2 emission rights or foodstuff. Consequently, volatility is elevating and triggering economic bubbles throughout the world. An effective mechanism of governance that secures global control is yet to be established.

 We are discussing with business executives around the world on how to enhance the adaptability of nations, societies and companies to incessant changes. Through such discussions, I came to realize “the strengths and weaknesses characteristic to Japanese companies.”

 Our strengths are resilience and capacity of continuous improvement. Japan is inflicted with frequent natural disasters, like earthquakes and typhoons. Each time, we have recovered ourselves, learned lessons from the disasters and made preparations for the future. For example, we stipulated the world’s first Building Standards Act after the Great Kanto Earthquake in 1923 and devised quake-resistance standards.

 Our weakness is that our society or companies fail to have extensive preparations for the situations beyond assumption or expectation. We can learn from the US National Intelligence Council (NIC) that has formulated measures to be taken against “events of very low probability yet with tremendous impact.” Such measures are reflected in the policy planning and implementation phase. Japanese companies should also make plans for “non-major business scenario that might cause tremendous impact.”

 I believe Japanese companies can recover their vitality in the global market, once we overcome our weakness and leverage our innate strengths.

Initiation Speech

Mr. Hiroshi Oura
Honorary Advisor, Advantest Corporation

Providing Assistance to Advanced Technologies in the Forefront

  My speech today will be on the semiconductor production equipment industry. The K computer became the world’s fastest supercomputer in 2011, with the performance speed exceeding 10 petaflops per second. This speed is equal to calculations made by 7 billion people on the earth over 17 days around the clock. More than 80,000 central processing units (CPU) in the K computer are tested by the semiconductor test equipments, a good proof that we assist advanced technologies in the forefront.

 The semiconductor market is forecast to stay slow-growing for 2012, yet the smartphone and tablet device markets are thriving.

 Semiconductors are installed in almost all electrical appliances. For example, a car can be restated as “running semiconductor” because its operations depend heavily on semiconductors, such as engine control, power windows and so on. Today, the “smart city” initiatives, a new form of urban design, are implemented throughout the world, in which semiconductors play an essential role. Semiconductors have a growing range of applications and the number and types installed in each appliance are increasing.

 Semiconductor production has diverse phases, requiring specific manufacturing equipment for each process. Thus, our industry is divided into various equipments. Eight Japanese manufacturers ranked in the top twenty production equipment manufacturers in 2011. Japanese manufacturers also enjoy the world’s top share for many equipments.

  Our industry has bright prospects as there are growing expectations towards the new semiconductor technologies, including the 3D semiconductor packaging technology based on TSV (through silicon via) as well as the next-generation power device utilizing the new materials SiC (Silicon Carbide) and GaN (Gallium Nitride).

 Before closing, let me touch on the future of semiconductors. The Nobel Prize in Physics in 2012 was awarded to Serge Haroche and David J. Wineland, who opened the door to the future “quantum computers” that will allow parallel processing of massive amounts of information. One theory has it that a calculation which takes 10,000 years by the current supercomputer will be done in just one hour. Let me also introduce the research on a semiconductor modeled on slime mold. This mysterious creature transforms its amoeboid body depending on the surrounding environment. The mechanism of selecting its form out of multiple combinations is similar to the process of calculation that eliminates useless alternatives. By incorporating this principle to the semiconductor computational technique, we can develop a new computer that can make flexible and instant decisions in ever-changing circumstances.

 Either of these studies will take many years for its practical application. Our semiconductor production equipment industry will keep providing further assistance to make the dreams come true.