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IT shifting to BPO services from legacy SI: Hitachi Systems CEO, Kitano

Yogesh Gupta | Dec. 14, 2016
Enterprises’ demands are fast changing from IT products delivery to service offerings, says Masahiro Kitano, President and CEO, Hitachi Systems

What is Hitachi Systems doing contrarily than other technology OEMs in the market?

Hitachi group has consolidated revenue of over 10 trillion yen and doing business worldwide in various fields including railway, energy, healthcare and more. And about 50 percent of the revenue comes from the overseas business doing out of Japan.

By collaborating with each other among these various business units, all of the group companies are working together to realize the social innovation. Hitachi Systems is doing ICT business as a part of the activities for the Social Innovation.

With the comprehensive power of Hitachi group, we can clarify the issues and solve the problems of the customers before providing them the solutions. For example Hitachi excels in monitoring plant systems, train control systems which is not pure IT. But aggregation of these industry trends with our IT expertise imparts the big competive edge from others.

Do you see CIOs globally seriously warming up to SMAC?

Many CIOs need to change their traditional mind-sets on buying IT and evolve as business strategist. Many CIOs we have seen don’t talk much with CEOs because CEO is more focused on cost-cutting spree to run profitable company. CIOs want to change the company’s IT infra into modern models but some CEOs might disagree.

From IT investment point of view, depreciation and investment should be balanced. The cycle of systems integration hence becomes a barrier for the company’s growth. We hence make a clear proposal for both CIOs and CEOs to be on the same conversation level.

In Asia, especially in India, the business is growing rapidly and the cutting edge technologies are used quickly in short bursts. Smartphone is a good example. In the actual customers’ business, these technologies around SMAC are adopted rapidly hence we need to carefully watch the customers’ trend and we would like to lead the market to support them.

What technology trends are impacting end user companies with respect to adopting new-age enterprise technology?

Currently most of the big-scale systems use packaged software which pedals the cycle of “system integration”. The software updated every few years means the customers’ business becomes restricted. However, the customers’ business is changing day by day and IT needs to support that. An ICT service company that realizes and support the agile improvements along with the customer’ new demands will make a significant contribution in the market.

How is Hitachi Systems moving its customers from on premise (capex) to cloud/SaaS (opex) business model? Is cloud happening for real?

Hitachi Systems migrates customers’ on premise systems into private cloud in our datacentre and also provide the system operations services. Gaining the customers’ trust in providing the private cloud service, we also provide hybrid cloud incorporating the public cloud service if required. And in Japanese market, the needs for the cloud adoption including SaaS is increasing and growing further, that is, we can say it’s not mature yet and the situation is same in US and European market.


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