Nikon 2014 Annual Report Download - page 23

Though customers are expressing more interest now that our
products are competitive, we will focus on how new customers
can utilize our products thoroughly. If our customers can
generate great results with better capability and favorable
cost performance, that information will spread throughout the
industry. This will lead to sales growth and help our business
discussions go more smoothly. Laying the groundwork fi rst will
lead to great strides later on, we believe. This is how we aim to
increase our customer base: by giving customers solutions of
greater precision in the entire production process and making
it easier for them to use our products.
Also, in the Medium-Term Management Plan we have set a
goal of at least a 30% market share for ArF immersion scanners,
featuring our newly developed NSR-S630D.
What business opportunities do you see in
the semiconductor market?
If a novel device appeared that diverted attention away from
smartphones and tablets, a new market could develop that
would prompt semiconductor manufacturers to increase
investments.
Also, it is clear that in developing countries, with their
growing economies, demand for semiconductors will continue
to rise. Since we have worked to enhance the performance and
productivity of our semiconductor lithography systems and
improve their cost performance, we certainly will capture these
business opportunities.
What is the plan regarding how to enhance
cost performance?
The need to miniaturize continues on, year after year. But a
considerable amount of capital is needed to develop methods
for further miniaturization, and we have to clear more in profi ts
to obtain the amount of capital that is needed. We are thus
forced to revise our breakeven point and are working on structural
reform to lower both fi xed and variable costs.
To lower fi xed costs, we have been shifting personnel to
other units, outsourcing work, and streamlining our operations.
Until recently, we possessed a uniform in-house supply chain,
from development through materials procurement to manufac-
turing, but now only the most vital and core items that set the
Nikon brand apart, such as projection lenses, are handled
internally, while parts that can be manufactured more effi ciently
by other companies are outsourced. In development, we have
discarded the notion to undertake all activities ourselves and do
not hesitate to use outside companies for tasks where they are
more advanced.
We reduce variable costs, such as for procurement, where
we can, and in development we can reduce wasteful spending
by more judiciously selecting which projects to begin.
Through these efforts, we are improving the breakeven point
of our business so that we are able to return to a profi table
status with our current level of net sales.
What type of business model should you be
aiming for?
The days are gone when we could simply step up the resolution
performance in our scanners. Overlay accuracy and other aspects
of productivity have become important. In our business unit,
we strive to come up with solutions for what is needed in the
customer’s manufacturing process or how best to interface our
equipment with a customer’s other systems. We also look for
ways to collaborate with manufacturers of various materials or
equipment.
Another approach is to continue to cultivate solid relation-
ships with our customers. One key to this approach is modularity,
which we brought in with the basic design of the NSR-S620
(launched in 2009). Going modular enabled us to make devel-
opment and manufacturing much more effi cient. In addition,
we found we could service the customers who had purchased
the NSR-S620 systems by enhancing their performance with
modular upgrades. Increasing the productivity of an apparatus
tends to be costly no matter what; however, buying a new model
every time productivity needs to be raised would be a particularly
ineffi cient investment by the customer. A look at trends in
semiconductor-related investment indicates how important
upgrading is in a business model. So when we offer a solution,
we aim to continue our services after installation to establish
a stable base of revenue.
With all the changes that are occurring in the semiconductor
industry, it is important to meet the customer’s needs as promptly
as possible. I would thus like us to bring about further growth
through timely action, whether at our worksites or when working
closely with customers.
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NIKON REPORT 2014