Omron 2016 Annual Report Download - page 15

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1. Advancing Portfolio Management
considered if we are to allocate limited
resources in an optimal manner. As such,
we incorporate a market value assessment
according to our strength as a company
(market share) and market attractiveness
(market growth rate) as supplementary
considerations in portfolio management.
This assessment system allows us to
identify the growth potential of each
business unit, making an optimal allocation
of our resources and generating greater
business growth.
Omron has divided its organization into
approximately 90 business units, each
subject to a portfolio management system
that assesses the economic value of the
unit according to (1) ROIC and (2) sales
growth rate. In this way, Omron
management can make proper and timely
decisions related to new business entry,
growth acceleration, restructuring, or
divestiture to drive improvements in Omron
Group value.
　We recognize that both economic value
and market value of a business must be
■
Portfolio Management Flow
■
Assessing Economic Value
■
Assessing Market Value
1.1. Evolution
S
Investment
A
Examining Regrowth
C
Profit Restructuring
B
Expecting Growth
Sales Growth Rate (%)
ROIC (%)
S
AC
B
Market Growth Rate (%)
Market Share (%)
STEP 1
Assess
Economic Value
Identify Growth
Opportunities
/Issues
Assess
Market Value
Investigate/
Execute
Improve
Management in
Each Field
STEP 3STEP 2STEP 4STEP 5
Integrated Report 2016 13
Where We
re HeadedAbout Omron Corporate Value Initiatives Corporate Value Foundation Financial Section