NEC 2015 Annual Report Download - page 21

Recovery in IT investment in Japan as domestic corporate business
performance improves
Japanese business models for convenience stores and retail services to
be further deployed in the international markets
Leverage NEC’s unique technologies to develop value
chain innovations
Expand “NEC Global Enterprise Solutions” that reflect our strengths and
track record in Japan and international market
Reduce costs through further cost management
Cost competition to intensify in Japan
OPPORTUNITIES NEC’S RESPONSE
THREAT FACTORS
In Japan, IT investments are expected to improve with recovery in
the performance of domestic companies though some industries
show weaker momentum than others. It is notable that IT
investments that contribute to a customer’s business growth or to
create new business for customers have gained vigor. Furthermore,
markets are projected to expand for enterprise SDN, which has
already entered a period of widespread adoption, and security, in
addition to Big Data utilization and cloud-based services. That said,
the IT market for private-sector demand in Japan is highly
competitive, and slips easily into price competition. As a result,
securing profits remains a challenge in these fields.
Globally, there are opportunities to broaden business with
Japanese companies making inroads to emerging countries, or an
expansion in local markets.
Improving profitability is the key factor for the medium- to long-
term growth of the Enterprise Business. NEC is approaching this by
shifting the business model of the Enterprise Business. This
includes that in addition to increasing the ratio of upstream
processes such as consulting in the systems integration business,
we will move ahead with packaging and toward cloud-based
services centered on growth areas. This will entail converting the
traditional customization model to a business model premised on
horizontal development.
Globally, NEC will further expand “NEC Global Enterprise
Solutions” and strengthen the business by leveraging the expertise
of Regional Business Support Centers (RBSC) in global development.
We aim to broaden target regions and industries, and create new
businesses in the international market.
On the basis of this business environment, NEC is responding with
ongoing efforts to reduce costs through cost management to
improve profitability of the Enterprise Business. In addition, we
continue to establish the competitive “Solutions for Society” by
accelerating the value chain innovations of “to create, transport
and to sell” to deliver the “Solutions for Society” closest to
people’s lives and lifestyles. Furthermore, in addition to expanding
SDN solutions to accelerate business development in the SDN
market, NEC is leveraging its unique technologies to focus on
growth areas: security solutions such as measures against
targeted attacks, information leaks and corporate response to the
Social Security and Tax Number System; failure sign monitoring
systems and demand forecasts using Big Data; and cloud services
catered to customers’ needs.
In expanding global business, NEC sets “NEC Global Enterprise
Solutions,” a set of strong solutions with prominent track records
in Japan, as its core solutions. With it, we will move ahead to grow
in Asian market.
For Future Growth
Business Environment
NEC's Issues and Responses
Medium- to Long-Term Value Creation
20
NEC Corporation
Annual Report 2015
Business Activities for Value Creation