Message from the President Sep.2012

At the current fiscal year began, we are maintaining the back orders in level of about 1,000. This number is equivalent level to that of before the Lehman Shock. Nevertheless, in the employee and president meeting, I have been saying that, we should not think that the surrounding environment to obtain orders have returned to that of before the Lehman Shock.

In extreme, before the Lehman Shock, we could have received orders even if our sales people were just waiting. And the 1,000 back orders were maintained by such orders. But today, the situation is totally different from then. First, our customers are strongly continuing their investments in technological developments in order to catch-up in the market even their current performances are unstable and outlook is uncertain. Our back order include orders from customer who is under-going major restructuring. Secondary, attitude of our sales people had changed from ”waiting" to "aggressive." Their attitude are changing that the orders are to be obtained, instead of the orders are to receive.

Therefore, even though the number is the same 1,000 now and that of prior to the Lehman Shock, contents are totally different. Also, as we look at our results of obtaining contracts, most of the orders which do not reach to actual contract within three months are vanishing. This means that the current 1,000 orders are replaced at speed incomparable to before the Lehman Shock.

As in the utilization ratio, just by looking at the figures, we often feel as if the situation is back before the Lehman Shock. However, they are all illusion. Actual condition is that the engineer staffing market itself is to be changed drastically before and after the Lehman Shock.

So, the purpose of the Mid-Term Management Plan “Co-Creation” is to change our corporate structure and business base to respond to such market changes. I am thinking that we shall steadily execute to meet the seven strategic objectives that are set addition to the revenue targets.