Toshiba Integrates All Business Operations in Elevators and Building Systems|
13 October, 2000
Tokyo--Toshiba Corporation today announced the integration in a single, dedicated company of its operations for the marketing, development, design and manufacture of elevators and building systems with its operations for sales, engineering, installation and maintenance of the same products and systems. The January 1, 2001 merger of the Elevator and Building Systems Company, one of Toshiba's in-house companies, with Toshiba Elevator Corporation, a wholly-owned Toshiba subsidiary, is expected to promote market-centric management, enhance business efficiency, streamlined decision making and product launches, and support business expansion.
The world market for sales and maintenance of elevator and escalators has a value of three trillion yen a year, and annual unit sales of 200,000. On a unit basis, Japan and Asia account for 50% of the world market. While a slowdown in the construction market has led to sluggish demand in Japan, a healthy average growth rate of 10% a year is forecast for China and Southeast Asia. Toshiba's reorganization of the business into a single, dedicated company is expected to focus on these markets and to advance efforts to global supply of products that meet market demands with the latest technological innovations.
Toshiba has promoted a series of strategic initiatives in its elevator business. It unified three companies handling engineering, installation and maintenance of elevators to form Toshiba Elevator Corporation in April 1998, and later added major sales function of the Elevator and Building Systems Company. In May 1998, Toshiba and Kone Corporation of Finland agreed on mutual supply of components and general cooperation. These moves have allowed Toshiba to make notable advances. Recent achievements include an order from Taiwan for the world's fastest elevators and commercialization of Japan's first machine room-less elevator. Toshiba's focus on innovative technologies has allowed it to increase market share and to take a leading position in its domestic market, even at a time of sluggish demand.
Toshiba introduced a new system of in-house companies in April 1999, a move intended to reinforce fast, focused decision-making, and to promote management to globally recognized objective standards. The establishment of the elevator and building systems business in a single, dedicated company is the first spin off from this system and represents a further innovation in business management.
The full range of operations supported by the new company, from product development to maintenance, will enhance business efficiency and the ability to achieve a timely response to customers' needs with high quality products and improved service. The total number of employees affected by the integration is approximately 800 in the Elevator and Building Systems Company and just under 4,000 in Toshiba Elevator Corporation.
Profile of New Organization
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