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10
Management’s Discussion and Analysis
RISK FACTORS RELATING THE GROUP AND ITS BUSINESS
The business areas of energy and electronics, the Group’s main business areas, require highly advanced technology for
their operation. At the same time, the Group faces fierce global competition. Therefore, appropriate risk management is
indispensable. Major risk factors related to the Group recognized by the Company are described below. The actual
occurrence of any of those risk factors may adversely affect the Group’s operating results and financial condition.
The risks described below are identified by the Group based on information available to the Group as of June 22, 2011
(the date of the filing of the Annual Securities Report) and involve inherent uncertainties, and, therefore, the actual results
may differ. The Group recognizes these risks and makes every effort to avoid the occurrence of these risks and minimize
any impact from them when they occur, by maintaining the proper risk management.
1. Risks related to management policy
(1) Strategic concentrated investment
The Group makes strategic, concentrated investments in the expansion of hybrid products and services in the areas of
NAND flash memories, smart communities, power electronics and EVs, recyclable energy, healthcare and digital
products, with the aim of accelerating the growth in focused business areas and establishing a new business base to
generate profits. The Group is also promoting selective allocations of resources with respect to such areas as System LSIs.
While it is essential to allocate limited management resources to high growth areas or areas in which the Group enjoys
competitiveness, in order to secure and maintain the Group’s advantages, the areas in which the Group makes
concentrated investments may not grow as anticipated, the Group may not maintain or strengthen its competitive power
in such areas, or the relevant investments may not fully generate the anticipated level of profit. In order to avoid such risks,
the Group is conscious of capital costs and of the need to conduct careful selection of investment items and to enhance
progress management. Alongside these efforts, the Group also aims to achieve growth through allocation of strategic
resources and to reinforce its financial base, by means of thorough implementation of comprehensive management of all
relevant investments that reflect the nature of each individual business. Further to this, the Group also makes every effort
to utilize external resources through strategic business alliances where necessary.
Main Places of Business and Facilities of the Company
As of March 31, 2011
Segment Major Distribution
Company-wide
Offices Principal Offi ce (Minato-ku, Tokyo), Hokkaido Branch Offi ce (Sapporo),
Tohoku Branch Offi ce (Sendai), Shutoken Branch Offi ce (Saitama),
South-Shutoken Branch Offi ce (Yokohama), Hokuriku Branch Offi ce
(Toyama), Chubu Branch Offi ce (Nagoya), Kansai Branch Offi ce (Osaka),
Chugoku Branch Offi ce (Hiroshima), Shikoku Branch Offi ce
(Takamatsu), Kyushu Branch Offi ce (Fukuoka)
Laboratories and others Corporate Research & Development Center (Kawasaki), Software
Engineering Center (Kawasaki), Corporate Manufacturing Engineering
Center (Yokohama), Yokohama Complex (Yokohama), Himeji
Operations (Himeji)
Digital Products
Laboratories Core Technology Center (Ome), Digital Products Development Center
(Ome)
Production Facilities Fukaya Operations (Fukaya), Ome Complex (Ome)
Electronic Devices
Laboratories Center For Semiconductor Research & Development (Kawasaki)
Production Facilities Microelectronics Center (Kawasaki), Yokkaichi Operations (Yokkaichi),
Himeji Operations-Semiconductor (Taishi, Hyogo), Kitakyushu
Operations (Kitakyushu), Oita Operations (Oita)
Social Infrastructure
Laboratories Power and Industrial Systems Research and Development Center
(Yokohama), Isogo Nuclear Engineering Center (Yokohama)
Production Facilities Kashiwazaki Operations (Kashiwazaki), Saku Operations (Saku), Fuchu
Complex (Fuchu, Tokyo), Komukai Operations (Kawasaki),
Hamakawasaki Operations (Kawasaki), Keihin Product Operations
(Yokohama), Mie Operations (Asahi Cho, Mie)