Komatsu has launched a three-year mid-term management plan (FY2019 to FY2021) named ‘Dantotsu Value – Forward Together for Sustainable Growth’.
The slogan ‘Dantotsu Value’ encapsulates the company’s commitment to link every workplace through excellence or Dantotsu. Workplace refers to a place where anyone related to Komatsu works, including the sites of customers, distributors, and suppliers worldwide. This term also encompasses Komatsu’s internal production sites (plants), R&D facilities, sales, service and administration and offices.
Hiroyuki Ogawa, president and CEO, Komatsu, said: “The links we seek to form go beyond IoT technology. Linking means aligning people along the same vector towards one direction and getting a job done with a strong sense of teamwork. The ultimate goal of our new mid-term management plan is to link workplaces worldwide through Dantotsu. Accomplishing this goal will put us in the best position to achieve our other quantitative and qualitative management targets.”
The three pillars of growth strategies under the new mid-term management plan are (1) value creation by means of innovation, (2) growth strategies based on business reforms, and (3) structural reforms for growth. The new mid-term plan also contains Komatsu’s first environmental, social and governance (ESG) targets to reduce CO2 emissions and increase the rate of renewable energy use.
Key Initiatives under the new mid-term management plan for FY2021 include:
• Reduction of CO2 emissions from product use (fuel-efficiency equipment, hybrid hydraulic excavator, rate of ‘SmartConstruction’ use, enhancement of ICT-intensive construction, mine automation, and underground mining equipment) by 16% compared to FY2010.
• Reduction of CO2 emissions from production (plants with zero impact on environment and workers) by 40% compared to FY2010.
• Reduction of water consumption by 40% compared to FY2010.
• Automation of construction, mining and utility equipment: test introduction of hydraulic excavators for automated loading; entry into the mining bulldozer market; and development of technology for automated forklifts.
Since the launch of the SmartConstruction solution for construction workplaces in 2015, Komatsu has introduced it to more than 8,700 sites in Japan (as of August 2019). Moreover, this solution led to a sharp increase in the digitization of processes through means such as condition surveys by drones. Going forward, Komatsu will link the 3D workplace information gained from digitized processes with its LandLog platform (product digitization) to promote the automation and optimization of entire workplaces.
Komatsu has formulated a vision for the workplaces of the future. In these workplaces, soil quantities and other data collected at workplaces will be utilized to optimize construction plans through cloud computing to send work instructions to ICT-intensive equipment. This information will also be used to automatically issue instructions for all other areas of the construction projects, including ordering of additional construction materials and dump trucks, through the platform.
To make these workplaces a reality, Komatsu will need to complete the development of the ‘Retrofit Kit’ (provisional name), a product that will be designed to install ICT functionality into existing equipment and thereby increase the amount of ICT-intensive equipment in use at workplaces. At the same time, it will be crucial to enhance ICT-intensive equipment, specifically through increased automation and through autonomy achieved via communication and coordination among equipment.
Komatsu is moving ahead with research and development on sophisticated automation and autonomy technologies with an eye to the introduction of 5G and other ultrahigh-speed mobile communications systems and the utilization of high-precision global navigation satellite system technologies.
Komatsu’s previous mid-term management plan (FY2019 to FY2021) was titled ‘Together We Innovate GEMBA Worldwide: Growth Toward Our 100th Anniversary (2021) and Beyond’.
The plan was based upon three priorities under the harsh assumption that the market would not recover: (1) growth strategies based on innovation, (2) growth strategies in existing businesses, and (3) structural reforms designed to reinforce the business foundation. However, the market began a rapid recovery from FY2017, which enabled Komatsu to achieve the management targets of the previous mid-term management plan with record-breaking sales and profit in FY2018.