about omron

a pioneer in the field of automation, omron corporation is one the world's premier manufacturers of automation components, equipment, and systems with advanced computer, communications, and control technologies. omron's versatile line up of products includes relays, sensors, and switches; computer systems for factory automation (fa); and large-scale control and information systems. omron is head quartered in tokyo, japan. omron was founded by kazuma tateisi an electrical engineer who started his career at a hydroelectric plant for the japanese government. in 1922, kazuma was transferred to inoue electric manufacturing company only to leave over a conflict of opinion with his superiors. he quit the company in 1929 after the new york market crash.

history, development & growth 1933: the origins of innovation this was the beginning of omron's commitment to "challenging ourselves to always do better" and the first milestone in their history of innovation. in addition to providing the financial base of the company, mr. tateisi's success with the x-ray timer determined the direction of future technological developments. 1935: establishment of a relay factory development of a general-purpose relay as production of x-ray timers gradually picked up, mr. tateisi developed an induction-type protective relay for use in power switchboards based on the voltage relay he had used for x-ray timers, and expanded sales channels.

1943: expansion of automation devices after extensive trial and error, omron finally perfected the precision switch-the first of its kind in japan. the switch boasted durability of more than 100,000 operations, an incredible lifespan at the time, considering its small size. this dedication to research and development allowed omron to pioneer the development of control components. 1960: advancement of automated systems through technological innovation as automation spread throughout japan, market demand for highperformance precision switches capable of withstanding more than 100 million cycles increased. mr. tateisi believed that this could only be achieved by creating a switch with a contactless (solid state) configuration, and challenged his engineers to develop such a switch. 1963: the first step toward cybernation development of an automatic ticket vending machine they developed the world's first multifunction meal ticket vending machine, which was able to issue three different types of meal ticket. the machine was put into operation at the daimaru department store in kyoto. these developments paved the way for the "cybernation revolution. 1964: tackling motorization issues development of an automated traffic signal omron steadily upgraded its signal control technology to increase functions and broaden the control area, building the foundation of today's traffic control system. 1967: developing an unmanned train station system

development of an automated ticket gate system omron later developed an automated ticket gate capable of handling both commuter passes and regular train tickets for hankyu railway's new kitasenri station. the world's first fully automated (unmanned) train station system was completed and put it into use in 1967. 1974: popularizing desktop calculators development of 'omron-8' in 1969, omron launched the world's smallest desktop calculator, the calculet 1200. the calculet's successor, the low-cost omron 800 (popularly known as omron-8), contributed to the widespread adoption of calculators. 1978: using electronic equipment to manage health in the mid-1970s, omron established a dedicated "health engineering" department to study methods of collecting biometric data, an essential aspect of health management. 1970: insight into the future of society, science and technology a study group was formed in 1967 to research future prediction techniques, give rise to the sinic (seed-innovation to need-impetus cyclic evolution) theory. the theory was presented at the international future research conference in 1970, where it was enthusiastically accepted. 1987: grasping the intangible in developing fuzzy logic, omron took on an unexplored area that incorporates ambiguity and subjective human ideas into machine control. when considering the company's future, it was renamed "omron corporation" in january 1990.

internal strengths and weaknesses

omrons motto at work for a better life, a better world for all reflects that omron believes that contributing to the society is its primary motive which will in turn result in rewards from the society. on may 10, 2006, the omron group established its new corporate principles-the omron principles, which consists of: corporate core value - working for the benefit of society management principles - challenging ourselves to always do better - innovation driven by social needs - respect for humanity management commitments respect for individuality and diversity maximum customer satisfaction relationship-building with shareholders awareness and practice of corporate citizenship

guiding principles for action quality test unceasing commitment to challenging ourselves integrity and high ethics self-reliance and mutual support

omrons principles were deep rooted in each of its business divisions and the employees. also these principles were seen in the following major activities global vendor management r&d culture customer relationships acquisitions people, leadership, culture

external environment
it identifies the environmental opportunities and threats on the industry and the macro environment to analyze the environment the company is confronting,

opportunities:
expand core businesses fast market growth diversification omrons purpose was to provide business solutions in the areas of safety, security, environment and health to cater to its consumers needs. and thus to ensure this they entered new market segments such as healthcare, security (technology to avoid counterfeiting). they approached this through related diversification. profitable new acquisitions omron made successful integrations due to its principles, culture, trust and brand name acquired over the years. most of them were self-integrations. to name a few:

threats:
japanese bubble economy in 1991 in early 1990s the japanese stock markets soared high resulting in large real estate investments, but when the bubble was at its peak the investors were unable to pay back the loans which resulted in economic slowdown and slow growth in almost all the industries. focus-diversification risk the growth in japanese economy led to several companies in the electronics industry diversifying which could have been a

potential threat to omron. also diversification became a setback to omron due to lack of control to the subsidiary units. quality risk in china several companies set up production plants in china with the intention of lowering their production costs and making profits. when omron decided to enter the chinese market, they found a major problem which could result in a potential threat, to distinguish between companies who are concerned about quality and ready to learn technology and those who are only apprehensive about profits.

swot analysis strengths:

- origins of innovation i.e first to innovate the x-ray timer to determine the direction of future technological developments - wide range of products - research and development

weaknesses:
- inept marketing plan - wrong focus i.e. focused on market share rather than on profitability

opportunities:
- expansion of core business - new acquisitions - grasp the intangible

threats:
- the accounting policies followed were asked to be revised once again this would create a major threat - the competitors would also become a major threat, if it does not update its technology

corporate level strategy

omron group has developed a new long-term management strategy for the decade up to 2020, called "value generation 2020," or "vg2020." though the competitiveness of the global market is growing increasingly intense, there are many business opportunities. they are employing two different ways of viewing our planet, the "globe perspective" and the "earth perspective," as they pursue growth opportunities during the vg2020 period. globe perspective: to pursue global growth opportunities for the existing business fields. earth perspective: to meet social needs relating to the sustainability of our planet. vg 2020 addresses the following three aspects: 1. strengthening existing business 2. business expansion in emerging markets 3. creating, fostering, and reinforcing new business

business-level strategy
1. industrial automation business (iab): aims at improving productivity and quality through factory automation.

2. electronic components business (ecb): aims at smoothening interfaces between people and machines to achieve ubiquitous computing. 3. automotive electronic components business (aec): aims at providing sensing and control technologies to make automobiles safer and more comfortable. 4. social systems business (ssb): aims to help create a safer and more comfortable society by providing a variety of systems designed to improve social infrastructure. 5. healthcare business (hcb): aims to provide a comfortable and healthy living through home medical care.

structure and control systems

omron brought about a major restructuring plan in 1999 as a part of its 10-year plan. this plan focused on - reducing workforce( including directors) - creating 5 major business lines containing 85 business domains - small but global concept i.e. small in business domain but global best in position omron electric consisted of 5 business divisions. they are:
1. 2. 3. 4. 5.

industrial automation electronic components automotive electronics social systems healthcare

their enterprise value was the sum value created by all the above divisions plus their brand value. it had a decentralised system. but they were trying to bring in centralization wherein all the business units contributed to increasing the brand value.