Foundation for Value Creation

Message from theChief Human Resources Officer
We are promoting our HR strategy to expand theSocial Innovation Business, based on the strategic
promotion of diversity and inclusion policies.
We are also upgrading management systems tobecome a truly global enterprise, including building
an integrated HR platform.

Hidenobu Nakahata
Senior Vice President
Chief Human Resources Officer (CHRO)

Human Capital Is a Critically Important Asset
In 1910, the same year that he founded Hitachi, Namihei
Odaira set up the Apprenticeship Training School. Thissymbolic act illustrates our belief in human capital being
one of the most critical assets in business. We benchmark
Hitachi’s human capital strategy and policies against thoseof a variety of global enterprises. I am exchanging opinions
directly with my counterparts at such companies. Basedon these discussions, I think that Hitachi is close to thelevel of major global players regarding our humanresources strategy and personnel management framework.
If I were asked about the strengths of Hitachi in trying togrow in an increasingly commoditized world, my unwavering
reply would be that we aim to realize sustainable growthby utilizing our human capital to create original value andinnovation. In accelerating our management strategy ofdeveloping the Social Innovation Business globally using
digital technology, two of the vital elements are developing
the people who can understand customer and social
issues precisely, and creating teams of people with diverse
viewpoints, backgrounds, and abilities to work together
towards common goals. For these reasons, my focus ison developing our human resources, including the next
generation of leaders, through promotion of diversity andinclusion. We have also been focusing efforts on building a
global personnel management system to support ourhuman capital utilization.

Initiatives to Promote Diversity and Inclusion
Diversity and inclusion are the wellspring of innovation forHitachi. We are building HR systems so we can evaluate
the performance of each position and role using acommon global standard. With the appointments of Mr.
Alistair Dormer as Global CEO of our railway systems
business and Dr. Brice Koch as the President of Hitachi
Automotive Systems, Ltd., a diversity of viewpoints isreflected in decision-making processes at the senior
management level. The ability to recognize diverse values
and express different opinions is critical to the provision ofoptimal solutions that fully address the issues faced by ourcustomers within an increasingly complex society. We willcontinue to promote diversity within management ranks.
Our global “Work Life Innovation” campaign, which
includes work-style reforms in Japan, aims not merely to

reduce total working hours, but to create more flexible
approaches to work to respect and cater to the values
and differing lifestyles of our varied individual employees.
We are creating work environments to enable individuals
to maximize their abilities, based on practices such as
telecommuting or working from a satellite office.
Diversity Targets for Hitachi, Ltd. (FY2020)
End-FY2017 (actual)

FY2020 (target)

Executive and Corporate Officers
Female2.5%

10%Non-Japanese

6.4%10%577

800

Number of female managers

31Reinforcing Efforts to Develop Next Generation of Leaders to Realize Sustainable Growth
In addition to Hitachi University, the Group’s global e-learning
management system, we have developed a variety ofeducational programs tailored to different jobs and positions.
We are also focusing resources on selective training
courses aimed at developing future managerial candidates
at an early stage. In these courses, participants discuss
what is necessary for the growth of Hitachi. The opportunity
to generate ideas to present to senior management helps
to cultivate the next generation of leaders— people withunique perspective and determination. In addition, we
have identified a group of about 50 employees from aroundthe Hitachi Group with next-generation development
potential. People in this “Future 50” group are selected on
merit, regardless of age, gender, or nationality. They aregiven challenges to help expand their horizons and build
their perspective, including tough assignments, different
types of work, and internal and external training
opportunities. The Future 50 group members receive
one-on-one mentoring opportunities with outside directors
to benefit directly from their extensive business experienceand global perspective. Our aim is to change mindsets so
we can develop people for important positions in the future.

Creation of Integrated Personnel Management Platform
We have introduced systems since fiscal 2012 to help
optimize the allocation of personnel to important positions
within the Hitachi Group, including the Global Human
Capital Database and Group-wide systems for grading
personnel and managing performance. Since fiscal 2013,
we have also conducted an annual survey of our global
employees called “Hitachi Insights” to cultivate dynamic
and supportive workplace conditions across the Group.
With a response rate of more than 80%, the survey
generates valuable feedback for business unit CEOs andother Hitachi Group managers. We also reflect the resultsin our personnel management to help promote greater
employee engagement.
In January 2018, we began full-scale operation of our
new HR Integrated Platform that brings together HR-related
information and processes. I expect three benefits from theintroduction of this platform. First, it will boost transparency.

Previously, we had no way of making timely assessmentsof the skills and capacities of the people working for
Hitachi Group companies throughout countries andregions. Being able to see these things will upgrade ourability to assign personnel to appropriate work and tocreate individualized development programs. Second, byenabling all employees to input experience or skills into thesystem and access HR-related information online, the newplatform reinforces the cultural shift within Hitachi toward
greater individual empowerment. It should translate directly
into greater development of those who are self-motivatedto broaden their horizons by taking on new challenges atwork. Finally, the new platform will boost speed andefficiency. For example, enhanced access to global data
will help us assign the necessary personnel for newprojects more quickly and efficiently, thus contributing tomore timely project start-ups.

Strategic Contribution of HR to the Realization of Society 5.0 and SDGs
Ever since it was founded, Hitachi’s corporate philosophyof “contributing to society through development ofsuperior, original technology and products” has embodied
the values that are expressed in the SDGs.
Our strategy for human capital development is in linewith the aim of the Social Innovation Business to addresssocial issues. Its promotion can make a significant
contribution to realizing the Japanese government’s“Society 5.0” vision and achieving the SDGs. Most notably,in our personnel development and the promotion of diversity
and inclusion policies, we are actively working to achieve
Goals 4, 5, and 8.

32

SDG focus

Hence, by reforming and developing our HR management
platform and systems, and creating conditions to makeeffective use of them, Hitachi’s diverse workforce will help
realize sustainable growth while also contributing to therealization of the “Society 5.0” vision and the SDGs.