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Marketing Report

Contents 1 Executive summary 2 2.1 HCA mission, values and vision 4 2.2Marketing Report Objective 5 3. Phase 1- Industry and client partner overview 6 4. Phase 2 – Key ethical and social responsibility issues and challenges in the relevant industry sector, and for the client partner 9 5. Phase 3 - Analysis of existing ethical and social responsibility policy and practice of the client partner 11 1. Recognize 12 2. Identify, prioritize and act 12 3. Review and improve 13 6. Phase 4- Strategic recommendations for future ethics, and social responsibility policy and practice 14 6.2Recommendation for future social responsibility 14 6.3Recommendation for future Ethics 16 6.4Strengths, weaknesses, and impacts of the projects 17 6.5Alignment of the Global Policy 18 References 18 Appendices 19 Appendix1 19 Appendix2 19

1 Executive summary
Hitachi was founded in 1910 as a repair shop for machines in Hitachi city, Kuhara Mining Company in Japan by Namiel Odaira. It’s founding spirit was “Harmony”, “Sincerity and the “pioneering spirit”. (Hitachi Plant Technologies Ltd, Japan 89) Namiel wanted to contribute to society through the development of original, superior technology and quality products. (Hitachi Plant Technologies Ltd Japan 20) Hitachi is articulating its desire to address key worldwide challenges through Social Innovation Business with their slogan “Social Innovation- It’s our future”.
Hitachi as a global company operates in a number of countries. This has been made possible through subsidiary companies and the extensive marketing in other countries creating a demand for its products. The countries are in different regions including: * Europe (146 companies) * China (177 companies) * North America (84 companies) * Japan (283 companies) * Asia (186 companies excluding China) * Oceania (11 companies) * Other areas including Africa, Middle East, South and Central America (60 companies)
Hitachi offers a broad range of services and products which include: * Social infrastructure * Industrial equipment * Train components and equipment * Digital presentation solutions * Data storage systems * Power tools * Construction machines and commercial vehicles * Car/ machine audio and visual equipment * Logistic Solutions
The products are handled in ten different sectors with each sector specializing in the particular products assigned to it. These wide ranges of services and products offered are popular among the customers who have continued to increase in number over the years (Hitachi Plant Technologies Ltd, Japan 78). The company has a skilled workforce globally that help realize the company’s goals and also objectives.
Hitachi has three parent firms that have grown over the years. Hitachi LTD has more than 320,725 staff globally. The company has over 1000 subsidiary companies globally that help in the production and marketing of the products. Hitachi LTD had a turnover as at 2013 was US$93.3 billion. HCM has over 20911 staff and a turnover of US$8 billion that represent 8% of the Hitachi group turnover. Hitachi Construction Machinery (Australia) Ltd (HCA) has over 1123 staff nationally and is located in Australia. HCA had a turnover of AUD$834.4 million that represent 10% of HCM’s turnover and 13% of HCM’s PBT (Hitachi Plant Technologies Ltd, Japan, 130).
Hitachi is headed by David Harvey, who is the Managing Director and deputized by Eddie Murata. Under them are a number of directors, general managers, and regional general managers. The directors are responsible for the various departments including sales, branch operations, financial& IT services and a non-executive resident director. The regional managers look into the different regions available from the Northern, Southern, Eastern and Western regions. The general managers head the various sectors of products produced by the company (Hitachi Plant Technologies Ltd, Japan 45). 2.1 HCA mission, values, and vision
To sell products with high quality with support from the technical team at the customer’s level of expectation.
Total customer satisfaction
* safety takes priority over everything else * keep promises * leadership * value for all stakeholders * quality in everything we do
The mission and statement are a true revelation on how the company has maintained the spirit of the founding father Namiel (Hitachi High Technologies America, Inc.30).
The company has a number of goals including: * To improve safety standards * Challenge ourselves to rise above our competitor sand help develop relationships with our customers based on trust. * Work to achieve total satisfaction * Improvement of communication between various company departments * Set and meet financial growth targets
2.2Marketing Report Objective
Hitachi’s main objective is to become a major provider of the social and construction infrastructure and thus providing a vast variety of services and products globally. The company aims to expand globally into new and existing markets. It also hopes and aims to enhance business competitiveness and strengthen the R&D capabilities (Hitachi High Technologies America, Inc. 46).
With emerging threats to competition, the company aims to establish an efficient and motivates service and sales system. The company also wants to strength then the company’s quality through demonstration of the company’s advantage of offering quality and reliable solutions (Hitachi High Technologies America, Inc. 23).
3. Phase 1- Industry and client partner overview
The industry has grown over the years. Demand for quality machinery has been on the rise with the increase in technology. Development of technology has led to better equipment and machinery for factories, home appliances and other places in general. Hitachi has invested a lot in research to get the best equipment and also the best machines made to help meet the needs of the end users. (Hitachi High Technologies America, Inc., 74) The increase in demand has necessitated the expansion of the company to other areas and not just Japan over the years.
The quality products offered have been important in attracting new customers and investors in the industry. Hitachi has been able to increase its production as a result of the quality services it does offer. These services and products and services are produced by a highly skilled workforce and high-tech machines (Hitachi High Technologies America, Inc., 57).
The global economic crisis affected the sector in a big way. The cost of resources and transport also led to reduced market expansion and sales. Most of the consumers of Hitachi’s products have reduced consumption after this occurred. Although the impact has been felt global, the recent economic rise in the financial markets and the issue of shares has increased the resources available for Hitachi.
Hitachi also faces stiff competition from other players in the industry and has been devising ways to counter the competitors. The company faces competition from other renowned machine manufacturers. (Hitachi High Technologies America, Inc., 56) With the industry being a leading economic pillar in Japan and also other parts of the world, new entrants from potential and foreign investors has increased competition. (Zu 52) Most companies are opting to have intense research and investment to improve on the technology used to counter the effects of competition.
Vehicle manufacturers are the major competitors in the industries. Brands like Toyota have posed a major competition with the growing industry. Hitachi has had to increase its research to ensure that they meet the needs of the customers. Demand from the middle class for machinery and especially vehicles have caused stiff competition in the sector.
Hitachi also faces stiff competition from construction companies who have intensified their marketing especially in developing countries. The use of cheaper building materials and technological advancement has enabled many middle age companies to be game changers in the sector. These companies have constantly intensified their marketing and changed the technology used to help boost the outcome of their products.
In the Australian market, Hitachi main primary end users are males in the age bracket of 16-59 years, technicians and tradespeople. The men mainly focus on the price and quality. The secondary market constitutes females and DIY users who are mainly the middle class and low to middle-class income earners. The secondary market is price sensitive and not very interested in quality and service. The purchasing pattern is dependent on the season or period involving mainly construction periods and climatic seasons. (Zu, 76) The use of social media has helped increase how these people are reached. They are mainly located nationwide and in the Pacific Islands. The various regional areas and major cities are also a target especially in Fiji and PNG.
There has been an rapid increase in online sales through the use of social media for advertisements. Dealers and end users can get information through Facebook. YouTube has been used to inform and entertain potential and existing customers about Hitachi power tools. The website provides a platform to access materials such as manuals, leaflets, spec sheets, videos, images, warranty, catalogs, service information and other information to the users. The E- Newsletters (EDM) is used to inform consumers of new products and other updates from Hitachi.
Hitachi customers get the products mainly from distributors from the company since the company utilizes a distributor based network. The company uses the push-pull strategy to distribute its products. There are a number of the large national groups, both retail and industrial consumer focused. * Masters distribute mainly to DYI users and Tradespeople. * Blackwoods distribute to technicians and trade workers and also the mining, construction, and the heavy maintenance sector. * SYDNEY TOOLS supply mainly to technicians and trade workers and the major contractors like those in mining. * TRADETOOLS supply small and localized businesses and also the major contractors. * ESCO does both industrial distributions and supply to the DYI users. (Hitachi High Technologies America, Inc., 57)
Demand for these products is subject to a number of factors from environmental factors that branch to economic, socio-cultural and technological (Sheng and Chen, 43). Carbon emissions in the manufacturing processes have led to changes in the demand patterns as most of the consumers prefer environmentally friendly products. Rules by world organizations that strive to protect the environment are also regulating and controlling amount of demand and production.
Infrastructural developments have helped increase demand for many roads and buildings are being constructed. The mining and construction sector has been boosted over the years as a result of these initiatives. (Sheng and Chen, 100) Development of new industries has increased demand for new and quality machinery and also the repair and maintenance of the same and thus increasing demand.
Technological enhancement has made it possible to develop new and efficient machines and equipment. Creation of high-quality devices has been Hitachi’s vision. Hitachi has therefore been able to increase the demand for its products and thus helped increase sales.
Engagement in socio-cultural activities has made the sales increase immensely. Most of the new customers have been pleased with the various projects that Hitachi is undertaking to help in the community development. Hitachi has a plan for increasing these activities to ensure that it gives back to the community. Most of the employees of the companies under Hitachi are residents of the area where the company is located (Hitachi High Technologies America, Inc., 2014 pg53).
4. Phase 2 – Key ethical and social responsibility issues and challenges in the relevant industry sector, and for the client partner
There are a number of issues from ethical to the social responsibility that affect the industry and the clients. The social needs represent the largest and most underserved available market opportunities. Hitachi’s productivity is influenced by these factors, and the company must ensure it formulates policies to handle them.
The effects on the environment through the byproducts and also disposed products are on the increase. Most of the customers complain about the old equipment they have failed to dispose of and don’t have use for them. Hitachi produces products that can only be recycled if they aim to save the environment. Environment degradation through the emission of gasses is also leading the fight to reduce global warming. (Hitachi High Technologies America, Inc., 78) Hitachi has organized and came up with policies to ensure that they help protect the environment.
The safety of workers is also a major challenge. Many accidents do occur in the mining sector and also during construction and other services offered by the company. The safety of the employees is therefore key to ensuring that lives are protected (Reis, 56). Many people lose their lives as a result of poor safety standards maintained by their companies. Employee health is necessary for productivity. Hitachi aims at ensuring that enough and high safety standards are met so that its employees and the public is not at risk of getting injured (Reis 46). Most injuries in industries may be due to negligence. Education to employees will help ensure that cases of injuries are reduced and minimal.
Gender and racial equality in employment are important. The industry has been faced with instances of biased employment. With a world of diverse culture, race and beliefs, it is important to ensure that work opportunities are allocated fairly. Fairness can only be realized if the company makes the recruitment process open (Pride and Ferrell 41). Gender and racial balance in employment will help give the company a good public image. Hitachi is known to have most of its workforce from diverse cultures and stands. Most of those who work at the company undergo a rigorous training and interview process and, therefore, get chosen on merit. The company also trains the locals to ensure they also get skills that can be employed in the company (Pride and Ferrell 41).
Safe drinking water is necessary for survival and helps ensure proper health is maintained. Most places lack fresh drinking water. Pollution of major water bodies has led to most people lacking access to uncontaminated water. Hitachi has a number of water projects aimed at solving major water problems in the Tropical Paradise and other areas. The company will be able to ensure that locals get fresh water (Hunnicutt 86).
If companies do not help solve these challenges, the business environment present will not be conducive to handle and also address challenges facing businesses. Both the players in the industry and the clients will work in an environment that is not conducive. Such an environment will make it hard to enter into deals that are productive (Hancock 78).
These social factors have a bad effect on the marketing of a business if not handled well. On the other hand, a company that helps solve these challenges will be better placed in advertising its products. Moves that depict the company as conscious of the challenges in society will help initiate the marketing process (Hancock 46).
5. Phase 3 - Analysis of existing ethical and social responsibility policy and practice of the client partner
Understanding of the social and environmental global expectations through communications with stakeholders will help integrate the expectations into the management. From the company’s CSR, the mission is: * To formulate environmentally and CSR initiatives that contribute to giving solutions to social issues. Hitachi’s social innovation business aims to help solve these issues from the aspect of energy, social contribution, CSR and environment (Hitachi Plant Technologies Ltd, Japan 75). * Have governance that helps realize sustainable management. Implementation of PDCA will help ensure that there is improved quality in management and also help mitigate business risk in areas of environment, human rights and supply chain. * Having appropriate communication that helps enhance understanding with the parties involved. (Hitachi High Technologies America, Inc.78)
A number of policies can be employed to help in ethical and social responsibility. Recognition of the company’s social responsibility is critical.
1. Recognize
The company will understand all the social responsibilities it has in society.
2. Identify, prioritize and act * The company will develop a corporate system and culture to ensure integration of the CSR into the decision-making process at all management levels. * The company will help increase awareness of human and business rights among the stakeholders and also work to meet its responsibility to respect and foster human rights. * The company will also comply with the labor laws, international principles and regulations to help develop and sustain fair labor practices and create a healthy working environment that has fairness in employment. * The company will prevent pollution to the environment through control of the business activities and also help in protecting biodiversity and the environment. * Through regulations of the operating practices, the company will ensure that it acts ethically and promote social responsibility through the use of the value chain. * Engagement in society building activities will also ensure that the company is part of the community through social contributions. * Sharing adequate information on services, products and quality assurance to ensure that consumers get the best and reliable information (Hitachi Plant Technologies Ltd, Japan 100).
3. Review and improve * the company will review and improve the CSR through reflection of expectations from stakeholders into the activities of the business and also develop trust relations with the society by fulfillment of the social responsibility (Hitachi Plant Technologies Ltd, Japan 90).
Strengths and weaknesses
The policy is focused toward ensuring that the society reaps from the business. Major challenges and issues are upheld in the policy. The most important policy is the one on environment protection. This will help conserve the environment and reduce pollution.
Projects to help in community developing programs are also helpful (Blythe 86). The fact that human rights are championed in the policy will help ensure civic education and that the society feels safe.
The policy will require a lot of funding especially in the environment preservation. This funding may pose a problem especially when sales are low. There is also the threat of over involvement in community development activities that also require a lot of funding (Cragg, Schwartz and Weitzner 67).
The client partner also needs to develop a number of policies. These policies will help ensure that he works towards society responsibility. Environment protection through recycling of old machinery is the most significant policy (Blythe 85).
Other policies include: participation in community development with other stakeholders, lobbying for human rights and giving appropriate feedback to the company on its input.
These policies will help ensure that the environment is protected through recycling and that there is a general respect for the law. It is, however, hard to achieve effectively the policies since most clients rarely recycle used machinery and they may also feel that it is not their responsibility to take part in community development activities (Aslan and Şendoğdu 89).
HCA’s policies are in line with those of the parent Hitachi Company. Policies on environmental preservation are important and are found in both. HCA aims at protecting the mine sites and also construction places (Aslan and Şendoğdu 54). The lobbying for human rights is in both the two companies together with information on labor practice also found in both.
6. Phase 4- Strategic recommendations for future ethics, and social responsibility policy and practice
Hitachi has worked on many corporate social responsibility programs that have led to the company gaining various key stakeholders. For a company to maintain its share of the market, they have to prove their worth in enhancing the lives of the customers and the community as a whole. (Hancock 86) The reputation of a company is driven by many factors and the management at Hitachi has remained observant of the requirements. Reputation drivers of trust and behavior will include performance in corporate social programs, industrial innovations in the various economy segments, and overall performance of the business. Through its extensive projects, Hitachi has managed to win the stakeholders trust placing a tremendous strategic advantage on them.
6.2Recommendation for future social responsibility
In the face of the ever-changing global needs, Hitachi must remain focused on developing modern outreach strategies. They have to work in administering extremely active projects at minimal cost to the company. The period of the projects remains a deterministic factor so that projects guided by a realistic time in the most efficient way. The following recommended projects have a base on the company`s practical strategy. They mainly focus on shared value, which underpins the most regarded mission and objective of the company social programs. (Hancock 74)
The introduction of a project that addresses various environmental issues will complement the established green project. It is a global problem, which all companies are required to comply with environmental policies set by different organizations and governments. Conservation of the environment of its clients and the world wide community gives the company a strategic advantage, through the support offered. Hitachi has to observe its environment conservation responsibility to its customers through creating efficient waste reduction mechanisms. (Hancock 78). The company has continued to work on scientific research that will lead to innovation of more efficient sources of energy. Hitachi should roll out extensive solar powered projects in different communities that they identify as viable areas. The solar panels developed by Hitachi are cheaper and offer a solution to the disadvantaged in the community. (Wolfe 78) Under a non-profit motive, the company should install a vast number of solar powered systems in different homes. Marginalized communities use solar power, as an alternative source of power for electricity. The company would work to donate solar home based LED lights and the children in the families can use them for studies. Overall, empowerment of the people will have to begin by education. Hitachi will instate a commission of skilled personnel and professionals in the industry. They will have a task of providing free training to the communities in which the projects are supposed to roll in. Technicians will be included to ensure stability of the entire solar installation program. Beyond the communities benefiting from the solar installation project, the company will further sensitize on solar energy advantages and various environmental issues at various forums. (Wolfe 56)
6.3Recommendation for future Ethics
Maintaining business and communal ethics in the daily practices is every person`s responsibility. For Hitachi to remain as one of the most Ethical companies ranked on a global basis, they have to hold all contractors, consultants, and employees to the highest business standards. The company should work with all its customers and various stakeholders in the industry to develop an effective means of accountability. (Miller 86) For the business to involve concerned third parties and customers, they should create an online reporting system. This will ensure that the customers give their evaluation of processes they undertook while performing business with the company. Further, Hitachi should establish a hotline number, which probably works on a 24 hours system to receive issues raised by the consumers. It is in line with business ethics that the company should protect the confidentiality of proprietary information.
Values of the company will extend to respecting the rights of the customers and communities in areas of location. The company`s management should eliminate or at least minimize environmental pollution by the company`s production pollution. Air pollution could have profound health effects on the communities and could further the disaster of global warming. Hitachi should work with efficient energy sources that eliminate the need to use fossil fuels. (Miller 65) They should handle gaseous waste in the most elite manner, through filtering of harmful particles. The management should make efficient administration of sound pollution control ensure that the communities remain at peace. Measures could include installing sound proofing materials to households near the production plants. The company will continuously use huge volumes of water in different production plants due to the nature of the manufacturing process. (Miller 70) In the selection of the water sources, the company should be cautious not to deplete water available for the communities. It is an ethical issue that the company should device proper liquid waste mechanisms. The wastes should never redirect to water sources.
6.4Strengths, weaknesses, and impacts of the projects
Implementation of the solar project has a strategic advantage of improving the corporate image of Hitachi. The public image of the company will significantly improve. The world will henceforth view the company as a people oriented company that is determined to improve their lifestyle. More consumers will form loyalty with the company and pose as potential customers. (Hancock 41) Media coverage for having undertaken the projects will highlight the company`s contribution to environmental friendly energy. Through the implementation process, the company will forge strategic partnerships with organizations geared to similar objectives. (Holt 87)
Building mega solar plants presents a broad range of technical issues. Equipment selection for rolling out the projects is determined by the nature of the project`s location and the amount of energy required. The company will further have to work with other companies to ensure that they do not overrun government plans and that the entire power system remains coordinated. The company also faces the problem of design licensing to fit specifications of areas they wish to roll out the projects. The whole process taken in engineering, production, and installation is demanding. The project thus implicates big financial requirements onto the company.
The improved code of ethics regulation systems poses strategic strengths to the company. Through the reporting systems, the company will manage to eliminate various vices that have implicated business performance. Corruption has significantly reduced the profitability of many organizations, and thus implementation of ethics would counter the vice. Other ethical programs such as waste disposal will eliminate the associated environmental hazards. The rate of infections and deaths caused by pollution effects will significantly decrease.
6.5Alignment of the Global Policy
Implementation of social responsibility programs and ethical improvement undertakings will have a significant effect on global placing of the company. The community will have aligned itself with the global objective of social welfare consideration as the fundamental concept underlying all businesses. A world business community has identified the need to have a social venture beyond the profit motive. Hitachi would have complied with this mission through implementing the solar power projects. Different organizations have pushed for effective waste management mechanisms. (Miller 41) The company will follow suit in changing the world`s environment by putting in place the waste management policies.

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Cragg, Wesley, Mark S Schwartz, and David Weitzner. Corporate Social Responsibility. Farnham, England: Ashgate, 2009. Print.
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Sheng, Chieh‐Wen, and Ming‐Chia Chen. 'The Influence Of Environmental Practices On Ethical Attitudes: Internal Principles Vs External Factors'. Social Responsibility Journal 6.4 (2010): 510-521. Web.
Wolfe, Philip. Solar Photovoltaic Projects In The Mainstream Power Market. Abingdon, Oxon: Routledge, 2013. Print.
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...a disposable cartridge that contained the company’s proprietary microchip. The product was priced at $160,000 – each workstation shipped with four cartridges. CARTRIDGES Anagene also sold disposable cartridges – priced at $150 each. Each cartridge contained an electronic chip that held test sites laid out in a geometric grid called an array. Cartridges could perform up to 99 tests on any single sample. As the company sold more workstations, it expected the demand for its cartridges to increase rapidly. MANUFACTURING Anagene’s management decided to outsource the production of workstations to Hitachi. Hitachi and Anagene would work together to cut costs through value engineering thereby enabling the transfer price to continually decrease. Initially, the final testing would be performed at Anagene’s facilities. As the company grew, this activity would also be outsourced to Hitachi. Anagene built its own manufacturing facility for the cartridges in order to capture the profits from the very high forecasted sales of its product....

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...What is asymmetric encryption and why do we need it? Asymmetric encryption is also known as public key encryption where there are two keys, a public key and a private key (Ezeobika, 2010). One key is used to encrypt and the other to decrypt (Hitachi ID Systems, Inc., 2013). Asymmetric encryption allows users to send secret messages by encrypting with the public key that belongs to the recipient (Hitachi ID Systems, Inc., 2013). Only the recipient will be able to decrypt the message because only that person will have access to the required key (Hitachi ID Systems, Inc., 2013). A somewhat similar way to view this is the locking and unlocking of a safety deposit box at the bank. The bank has the “public” key that is used as one of the necessary keys to open and close the box. In this situation “public” refers to the same key used for other safety deposit boxes within the bank. While the renter has the private key that is also necessary to open and close the box. Asymmetric encryption is useful because it allows for digital signatures which allow the person who is receiving a message to verify that a message is truly from a particular sender and to detect if the message has been altered (Ezeobika, 2010). Lastly, asymmetric encryption allows for accountability because once a message has been digitally signed the sender cannot deny having sent it (Ezeobika, 2010). Agrawal, M., & Mishra, P. (2012, May). A comparitive survey on symmetric key encryption techniques.......

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...calculating the amount of each dump truck necessary to meet the waste removal requirement of 70 Mt/pa. Secondly, an expected cost for ten years was conducted on each Komatsu dump truck and cross analysed to determine the most cost efficient option. It was found that the Komatsu 930E-4 had the least expected cost over the ten years. Then cross analysing, each loader with the Komatsu 930E-4 truck, it was determined that the Hitachi EX8000-6 was the most efficient loader for a fleet of Komatsu 930E-4 trucks. Once these were completed, a full haul truck cycle time and expected cost analysis for each year was calculated. It revealed that thirty four Komatsu 930E-4 dump trucks were needed for a single Hitachi EX8000-6 loader. However, the above analysis was limited by the fact that it didn’t account for truck and loader break downs. By taking into account a 10% threshold on the number of trucks and loaders needed it gave some costs accounting for time where not all trucks are operational. This analysis yielded that a fleet of thirty seven Komatsu 930E-4 dump trucks and two Hitachi EX8000-6 loaders would be best suited for the Kangaroo Mining Corporation. The expected costs for both loaders and dump trucks were calculated (refer to table 1.9) and showed that the average expected cost per year of hauling and loading would be $142 613 457/pa and $11 869 288/pa respectively. Furthermore, the average expected cost per tonne of hauling and loading would be $2.04/t and $0.17/t......

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...these, China-Schindler joint venture has proved very successful. This strengthening position of Schindler poses a threat to the market share of Otis. Other smaller players, such as Hitachi, are also entering into agreements with Chinese elevator companies. Also, the JV proposal is for Tianjin, the third largest Chinese city which is also emerging as a major exports hub. This gives Otis an excellent opportunity to establish its footprints in China. CITIC enjoys considerable autonomy, and so I believe Otis may not face much challenges from the state government. TEC has really old manufacturing facilities, which would be leased and upgraded by Otis. This is a really cheap option over starting a sole ownership plant in China. TEC has been exporting to Hong Kong, Macao, Thailand, and Africa, where Otis does not have a prominent presence. This will help Otis expand in other geographical locations too. The current proposal also places a lot of decision capability in the hands of Otis, which is good for a foreign company operating in China. I believe one of the reasons for the low market share of Otis in the Pacific Area can be linked to Exhibit 2 of the case, which is also shown in Exhibit C. The average price per unit of Otis’s new equipment is higher than the average prices of those of Mitsubishi and Hitachi, which are the leading players in the Pacific region. One of the reasons for the high prices can be attributed to superior technology of Otis, and so it demands a price......

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