Always Reaching Higher - Yokogawa

Always Reaching Higher—Yokogawa centennial booklet—

Yokogawa Electric CorporationPublished in November 2015©2015 Yokogawa Electric Corporation

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Message from the President

Yokogawa Electric Corporation marked its 100th anniversary on September 1.

To help commemorate this major milestone, we have compiled this booklet in

the hope that this will reinforce our understanding of the principles Yokogawa

has upheld since its foundation and encourage everyone to work together to

put the company on the right track for another 100 years of success.

Yokogawa traces its history back to 1915, when Dr. Tamisuke Yokogawa, a

prominent architect, founded an electric meter research institute in Shibuya,

Tokyo. His ultimate aim was to begin the manufacturing of electric meters,

which were all imported in those days, and launch a new era for the

measurement industry in Japan. Amidst drastic social and economic changes,

Yokogawa continued to transform itself by expanding the scope of its business

from measurement to control and information solutions, and provided essential

core technologies that helped to spur industrial growth.

At the time of the company’s founding, Dr. Yokogawa explained his business

philosophy to Ichiro Yokogawa, who later would become the company’s first

president, and Shin Aoki, the eventual first chief engineer. Passed down over

the years to the present day, these founding principles emphasize putting

quality first, having a pioneering spirit, and contribution to society. Based on

these principles, Yokogawa has built trust not only with its customers, but also

the broader society, and has gone on to develop new technologies and become

a global enterprise. Our commitment to these principles is firm and unchanging.

Our business environment is changing dramatically as a result of globalization

and the transition to a multipolar world order. Likewise, change is coming to

industry as trends such as the integration of things and information gather

momentum. At this crucial juncture, Yokogawa is transforming itself to set the

stage for continued growth.

Taking the opportunity presented by this centennial anniversary, Yokogawa

has established the corporate brand slogan of “Co-innovating tomorrow.” This

clearly expresses the intent of the vision statement in the long-term business

framework that was announced in May: “Through ‘Process Co-Innovation,’

Yokogawa creates new value with our clients for a brighter future.” This has the

added purpose of encouraging all Group employees to work together. Under

this new slogan, Yokogawa will seek to build even stronger bonds of trust with

its customers by working with them to create value and stimulate growth.

I want to make Yokogawa an ideal company in which all employees can say

with confidence, “Our dream is to make customers’ dreams come true,” and I

ask everyone in the Group to be aware of Yokogawa’s history and values, and

to work together to make our next 100 years even better.

Takashi NishijimaPresident and Chief Executive Officer

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The Yokogawa Heritage

Pioneering spirit

Quality first

Contribution tosociety

In his instructions to Ichiro Yokogawa and Shin Aoki, Dr. Tamisuke Yokogawa said, “You don’t need to worry about profits. Just learn and improve our technology. You must make products that earn us the respect of our customers.” This is the origin of the founding principles that have been handed down through the generations and emphasize putting quality first, having a pioneering spirit, and contribution to society.

Although first set into words in 1988, the Yokogawa Philosophy is based on these founding principles, and is embodied in the code of conduct that guides employees in the performance of their daily tasks and in all pronouncements on our corporate objectives.

These core values are exemplified in the priorities and commitments made by each Yokogawa employee and which mold and shape our corporate culture. Rooted in these values, we will continue to create value and contribute to society as we point the way forward for Yokogawa’s next 100 years.

The Yokogawa PhilosophyAs a company, our goal is to contribute to society

through broad-ranging activities in the areas of measurement, control, and information.

Individually, we aim to combine good citizenship with the courage to innovate.

Respect Value creation Collaboration Integrity Gratitude

Core Values

The concepts and values that underlie everything we do at Yokogawa

did not come about in just one day. Amidst social change and

the growth in our business that has transpired over the past 100 years,

we have remained faithful to this cherished heritage.

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Vision Statement

Through “Process Co-Innovation,” Yokogawa Creates New Value with Our Clients for a Brighter Future

Our Next 100 Years—

In May 2015, Yokogawa announced a long-term business framework that states where we wish to be 10

years from now. The vision statement that is part of this framework clarifies what Yokogawa wishes to

accomplish in the long term.

We envision an automation business that will utilize all of Yokogawa’s measurement, control, and

information technologies. And with the phrase “Process Co-Innovation,” we refer not just to the optimization

of production processes, but to the improvement of the flow of products and information between

companies. In short, we will co-create new value with our clients as we work with them to provide

comprehensive solutions.

Having marked its 100th anniversary, Yokogawa will continue to strive for growth and live up to society’s

expectations. Unified under the new “Co-innovating tomorrow” corporate brand slogan, we will set out on

the path leading to our next 100 years.

The expression “Co-innovating” conveys our determination to keep co-creating new value by producing

solutions in long-term partnership with our clients. The word “tomorrow” expresses our resolve to move

steadily into the future one step at a time.

Looking ahead to our next 100 years, with the aim of remaining a company that can proudly proclaim

“Our dream is to make our customers’ dreams come true,” Yokogawa will stride confidently into the future.

Corporate Brand Slogan

Globally Recognized Technology and QualityHigh Precision and Long-term Stability — Keys to Winning Our Customers’ Trust ……… 12~15

Contributing to the Development of Modern Science and Engineering ∕ Scaling

the Heights of the Measurement Field ∕ A Theory- and Principle-based Approach to

Measurement ∕ The Value of Non-stop Performance ∕ High-quality Products at a

Reasonable Price — Improved Production Technology

Professional and Honest : the Yokogawa Approach to Delivering Solutions, from

Solution Proposal to Project Execution ……… 16~19

Yokogawa’s People Keep Their Promises — Yokogawa’s People Honor Their Commitments ∕

Our Customer Approach ∕ Challenges Keep Coming Even After a Project

Order Is Booked ∕ Comprehensive Solutions Backed by a Wealth of Expertise in

Production Operations ∕ Looking beyond Our Role as a Main Automation Contractor (MAC)

High Quality Solutions for Global Customers — the International Development of

Yokogawa ……… 20~23

Transitioning from Indirect Exports to Direct Sales ∕ Business Expansion Targeting the

Global Market ∕ Aiming to Be the Global No.1 in the Control Business

Excellent Execution of Megaprojects, as Demonstrated in the Petro Rabigh

Project ……… 24~27

Doing What’s Best for the Customer ∕ Yokogawa Selected as MAC for Global Megaproject ∕

Think Ahead, Be Prepared ∕ Petro Rabigh II — The Challenge of Providing Local Content ∕

Advancing Together through the Development of Saudi Human Resources

CSR InitiativesContributing to Society, People, and the Earth ……… 28~29

The Relationship between Business and Society ∕ Good Citizenship

Contributing to Society through Our Business ∕ Being a Good Neighbor

For Yokogawa around the Globe ……… 30~33

Our Past 100 Years

Chapter 1

From the Founding to Postwar Reconstruction (1915-1947) ……… 36~39

The Electric Meter Research Institute and Tamisuke Yokogawa ∕ Becoming the Top

Electric Meter Maker in Japan ∕ Oscillograph: an Early Main Product of Yokogawa ∕

Relocation to Kichijoji and Development of Control Devices ∕ Development of Aircraft

Instruments and Wartime Operations ∕ Yokogawa during the Wartime ∕ Yokogawa Starts

Afresh with One Tenth the Number of Employee

Chapter 2

From Postwar Recovery to Rapid Economic Growth and Oil Crisis (1948-1974) ……… 40~43

From Reconstruction to Recovery ∕ An Overseas Visit and the Decision to Develop ER

Instruments ∕ Tie-ups with Two US Companies ∕ Rapid Economic Growth Era in Japan ∕

Intensified Competition ∕ Setting Up of Yokogawa-Hewlett-Packard ∕ End of the Rapid

Economic Growth Era

Chapter 3

From Steady Growth to the Bubble Economy and Its Bursting (1975-1990) ……… 44~48

Overcoming Difficulties ∕ CENTUM: the World’s First DCS ∕ Entering the Medical

Equipment Market ∕ Improving Financial Strength ∕ Merger with Hokushin Electric Works ∕

Stronger Yen and Yokogawa’s Diversification ∕ Development Non-Japan Markets with the

Spirit of Mutual Benefit

Column

The History of Hokushin Electric Works ……… 49

Chapter 4

Overcoming the Post-bubble Recession and the Beginning of the Age of

Globalization (1991-2010) ……… 50~53

“VECTOR 21” and Organizational Reform ∕ Developing Unique Products ∕

Reforming the Control Business and ETS ∕ A New Long-term Corporate Strategy for

Achieving a Profitable Structure ∕ Bursting of the Dotcom Bubble and Another Structural

Reform ∕ Making Engineering More Competitive ∕ Transforming into a Global Company

under the Vigilance Campaign ∕ The Second Milestone of the VISION-21 & ACTION-21

Plan and the Financial Crisis in 2008

Chapter 5

Aiming to Become Global No.1 in the Control Business (2011-) ……… 54~55

Announcing the Evolution 2015 Mid-term Business Plan ∕ Control Business Responds to

Structural Changes in Market ∕ Transformation 2017: the First Step towards the Next 100

Years

Message from the President ……… 2~3

The Yokogawa Heritage ……… 4~5

Our Next 100 years ……… 6~7

Contents

Yokogawa’s Strengths

Yokogawa’s History

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Data Trend of sales and operating income

Trend of sales outside Japan

Sales by segment

Group employees

Group companies

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Yokogawa’s StrengthsGlobally recognized technology and quality

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Yokogawa 100th Anniversary

Throughout our 100-year history, from one generation of employees to the next, Yokogawa’s people have been steadfast and resolute in their purpose. This is why Yokogawa is at the top of the control field in Japan, and ranks alongside global competitors who do business on a scale that is several times or even tens of times larger. This firm resolution is the source of our strength, and it continues to make our position secure.

One of the foundations for this inheritance that provides a basis for the measurement and control engineering underlying our production systems is our sense of duty and the responsibility that we feel for the activities that we undertake as a business. Societies have flourished through the production and use of energy and goods, and modern science and production systems have dramatically accelerated this. The basis for all these activities has been detailed observation and the analysis of data derived from these observations. Mass production, automation, and mechanization have all been brought about through processes such as quantification, the accumulation of knowledge, and the analysis of data that all draw on the five senses and the human capacity for reason.

One hundred years ago, company founder Tamisuke Yokogawa had the following message for the two young

engineers who had been entrusted with the launch of the company: “You don’t need to worry about profits. Just learn and improve our technology. You must make products that earn us the respect of our customers.” He said this not only because they were starting from zero and were trying to catch up with Europe and the U.S., but also because his intention was to first become a trusted source of the technology that provides the foundation for research and development and manufacturing. Yokogawa has faithfully achieved these aims.

In 1924, the company’s 10th year in business, we developed a portable oscillograph, Japan’s first. At an international exposition that was held in May 1930 in Liege and Antwerp, Belgium, we exhibited an oscillograph, electric meter, and other instruments, and received an honorary award. Yokogawa’s oscillographs were continually refined over the next 30 plus years, and went on to play a key

role in supporting research activities at research institutions and universities throughout Japan.

This steadfastness has been evident in our pursuit to improve the accuracy of our power analyzers, which we have been selling since the company was founded and which continue to be a key product for Yokogawa today. For readings to be trustworthy and usable, measurement must be highly precise. Yokogawa has poured its heart and soul into this obvious fact. As the company was established not long after electrification had commenced in Japan, our first meters were mainly modeled after products that were being made outside Japan. But our products soon were the equivalent of anything produced elsewhere.1 And by the 1960s, a half century ago, we were targeting an

accuracy of ±0.02%, which is the same level of precision as the Japan national standard.

To stay accurate, measuring instruments must be calibrated; the equipment used to calibrate these instruments must also be calibrated, and that equipment must be calibrated as well... And so the cycle goes on. The national standard brings this cycle to a realistic conclusion, and the highest-level measuring instruments are referred to as “gods” in the industry. Yokogawa’s APR-2 power meter boasts such good performance that it has been purchased by another country’s national institute of standards and technology. Yokogawa has kept up with the latest technologies and holds the top share of the global high-end power analyzer market with the WT3000E precision power analyzer, and is once more in the limelight due to the current demand for further improvements in energy efficiency.

The unrivaled precision of Yokogawa’s instruments has its origins in our emphasis on getting back to the basics with a theory- and principle-based approach to measurement, as it is applied in research and development. Measurement of a physical substance, energy, and so on requires the manipulation of a target object and the capturing of data on its response. The first consideration in this is how to get the most accurate and detailed measurement of a target object. Yokogawa has wholly focused its efforts on this in its development and production of devices used to measure items such as power, pressure, temperature, and flow rate. We never take our eyes off what is being measured, and our strengths lie not only in efficient digital processing and the analysis of measurement signals and data, but also in the fundamental technologies that rely on analog elements to capture signals and data.

Our pioneering DPharp differential pressure/pressure transmitter was developed based on just such a theory- and principle-based approach. The application of pressure on H shaped resonators thinner than a human hair stretched out inside a tiny package causes a change in resonance that is converted to an electric signal and digitized. The maximum possible repeatability and stability (fluctuation of ±0.02% over a 15 year period) have been achieved by increasing sensitivity

CSU-W1 confocal scanner unit. This product series won the Okochi Memorial Technology Prize

DPharp, a pioneering differential pressure/pressure transmitter

The global top-selling WT3000E precision power analyzer

N-3 electromagnetic oscillograph. Oscillographs were long a good source of profits for the company

Cross section of a silicon resonant sensor

and reducing the effects of temperature changes and other environmental factors. This has been done by fabricating the sensor from a single silicon crystal and positioning it inside a vacuum chamber. By eliminating the need for periodic zero adjustments and the use of valves in this procedure, and by lengthening the calibration interval, we have made it possible for our customers to dramatically reduce their maintenance costs. And with a single DPharp transmitter, users can perform multiple types of measurements, eliminating the need for multiple transmitter types. All this is made possible by micro electro mechanical systems (MEMS) technology, which is another major weapon in Yokogawa’s armory.

A winner of the Okochi Memorial Technology Prize, our confocal scanner unit product has successfully resolved the issue of how to continuously capture images of live cells in real time at speeds approaching a thousand times per second. This relies both on optical measurement technology, a Yokogawa strength, and mechatronics technology. The high imaging speed is accomplished through the use of a laser beam that passes through a microlens attached to a disk with up to 20,000 pinholes to illuminate a specimen. This enables the dynamic movements of living cells and their organelle to be captured, making a great contribution in a wide range of fields, from basic biology through to the development of new drugs. Our development of other products such as vortex flowmeters has also been based on such basic theories and principles. Through our rigorous approach to research and development and our

Scaling the Heights of the Measurement Field

Contributing to the Development of Modern Science and Engineering

A Theory- and Principle-based Approach to Measurement

High Precision and Long-term Stability—Keys to Winning Our Customers’ Trust

1 Dr. Yasujiro Niwa was the first person in Japan to successfully carry out experiments with wireless telephotographic transmission, the first president of Tokyo Denki University, and a recipient of the Order of Cultural Merits. Around 1918 – 1919, at the telecommunications ministry, he suggested that Shin Aoki manufacture British-style measuring equipment in Japan, and later summed up his actions by writing, “In those days it was thought that the Japanese could never make such precision instruments, and demand for Japanese instruments was low. But Mr. Aoki accepted the challenge, and we were greatly pleased when, after one year of intensive research, he succeeded in building a meter that outperformed Western products.”

Globally Recognized Technology and QualityYokogawa’s Strengths

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collaboration with our customers, including major global companies, we have succeeded in producing and refining technologies that other companies cannot easily imitate.

Other technical advantages of all Yokogawa measurement and control products that have earned us worldwide recognition are long-term stability, high reliability, and environmental resistance. While our custmers expect our sensors and control systems to be highly accurate, they must also be capable of operating without interruption in challenging environments, such as an outdoors location where temperatures vary considerably or in a factory where

production technology, and the provision of support to these facilities outside Japan. By such means, the NYPS model has stayed true to our emphasis on considering human needs and has strengthened manufacturing by better motivating individuals and making greater use of their abilities.

The technological capabilities and the product strengths that Yokogawa has cultivated since its founding are the driving force behind our efforts to develop solutions. Our research, development, and production of reasonably-priced products and systems with the functions and quality required in this era of globalization sets us apart from our competitors. Now more than ever, Yokogawa is taking the high road in manufacturing.

Yokogawa has achieved 99.99999% availability ([1-duration of breakdown/duration of operation] x 100).

Yokogawa has quickly sought to develop standards based on these technologies. The company has actively engaged in developing new and highly reliable communications technologies such as FOUNDATION™ fieldbus and ISA100 Wireless, and has sought to promote the development of related international standards and improve compatibility between production control systems and the enterprise resource planning (ERP) and other types of systems that act as the brain for businesses.

Speaking of stability, another of Yokogawa’s strengths is product continuity. Since the 1990s, there have been numerous mergers and acquisitions of companies in the measurement and control field. Leading global companies have been particularly active on this front, expanding and strengthening their businesses by purchasing other market players. Numerous changes to software and other kinds of products have been made as a result, and this has led to difficulties for users in obtaining necessary parts for the upgrade or repair of equipment. In contrast, Yokogawa has always sought when offering new measurement and control products and systems to maintain backwards compatibility with existing products. Also with CENTUM,

the aim has been to prioritize human needs by, for example, designing the interface so that it has the same intuitive ease of use as an analog meter. And even in cases where it would be easier from a cost, performance, or efficiency perspective to completely change the control system, we have always put the priority on maintaining backwards compatibility when seeking to strengthen functionality. This is one of the reasons why CENTUM is so highly regarded.

In order to offer products and systems that achieve high levels of precision and stability, Yokogawa is continually seeking to optimize operations at its plants, which produce a great variety of products in small lots. Until the 1970s, Yokogawa followed a typical plan-based production model and kept large inventories of parts and finished products. However, as a result of the saturation of the domestic market, increased overseas expansion, increased competition, and other factors, Yokogawa decided to reduce its production costs by introducing the New Production System (NPS) in 1981. Based on the Toyota production system, this was an order-based production model. Unlike Toyota, which is engaged

in mass production and has sales systems in place to handle unit totals ranging from the hundreds of thousands to the millions, Yokogawa’s methods varied by individual product. For this reason, there was strong opposition to NPS at various work sites, but it was seen as a major step needed for employees to begin the transition from long-held concepts and approaches.

Later, Yokogawa introduced its own New Yokogawa Production System (NYPS). While staying true to basic NPS concepts on human needs and the elimination of waste, this proprietary NYPS model sought to standardize production volumes by strictly managing order information. Furthermore, it refined the mixed production method by integrating the management of information and parts for production lines, and completely removed waste from the product supply process by coordinating pre- and post-production processes such as development, logistics, and sales. Following this change in approach, steady improvements were made that, for example, substantially reduced lead times for products that traditionally had been held to have a six-month lead time.

In addition, production facilities were expanded outside Japan with the aim of improving production efficiency and allowing the modification of products to suit local market needs. There are now 19 production facilities outside Japan. Most of these are in Asia, and a few are located in Europe and the Americas. The role of the head factory in Kofu has gradually changed to the production of core products, the development of

CENTUM: Non-stop performance that always adds value

1975 release of CENTUM, the world’s first distributed control system

Production lines at Yokogawa Manufacturing’s Kofu factory

High-quality Products at a Reasonable Price—Improved Production Technology

The Value of Non-stop Performance

instruments are subject to vibrations. In other words, they must be both incredibly sensitive and tough. DPharp transmitters accomplish this by having silicon resonant sensors that are vacuum-enclosed and highly stable.

These factors are even more important for the CENTUM integrated production control system, Yokogawa’s flagship product. The CENTUM control system connects countless sensors that are located throughout a plant, using the data obtained to automatically control the plant’s operations. It is absolutely essential for a system like CENTUM to remain operational at all times. Since releasing CENTUM in 1975, we have continually upgraded its capabilities by, for example, introducing the use of dual redundant processor and main memory modules. CENTUM CS, released in 1992, features a pair

of micro-processor units (MPUs) in each processor module that perform the same computations and continuously check for transient errors. For advanced stability, it employs Pair & Spare, a superb method that achieves high reliability by automatically switching control to a standby processor module in the event of a system failure. Through such advances,


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Staying on schedule and on budget while catering to the needs of a customer is a basic for any business, but it is not always easy. With longer-term projects where there is more that can go wrong, Yokogawa’s people do everything in their power to stay on time and on budget.

In October 2005, Yokogawa hosted a symposium and technology innovation fair to celebrate its 90th anniversary. The company invited Simon Lam, an executive of the oil & gas supermajor Royal Dutch Shell and the CEO of CNOOC and Shell Petrochemicals Company Ltd., as a guest speaker. In his appraisal of our company, Mr. Lam noted three key characteristics:

• We keep our promises.• We don’t turn our backs on

difficulties, but confront them head on and see our work through to completion.

• We provide high-quality and reliable solutions based on the latest technologies.

While Mr. Lam addressed his words to the entire company, they resonated most deeply with the sales engineers and project leaders who have direct contact with our customers, and made them want to say, “That is exactly how I feel.”

In 1997, Yokogawa introduced its

Enterprise Technology Solutions (ETS) concept and stated its intention to seek growth by providing solutions in the Japan industrial automation and control market, which had by then reached maturity and offered few prospects for new projects. The company aimed to become a solutions provider that not only utilizes cutting-edge equipment and systems to optimize control systems at the factory level, but also optimizes all aspects of the operation

of such facilities – including even the business management level – over the entire plant lifecycle.

Furthermore, in the global industrial automation and control market, we understood that the ability to provide solutions from a business management perspective would become necessary as large-scale projects entered the planning phase.

This type of solutions business requires high-level communication

with customers and other companies such as equipment suppliers that is altogether different from the type of communication required to simply sell systems or individual pieces of equipment. Whatever the difficulties that we face, we must honor our commitments and, without fear of failure, follow projects through to completion. This may initially appear quite simple and straightforward to some, but it is not necessarily so. Mr. Lam stated that, from the customer’s perspective, Yokogawa is in these respects an outstanding company. It was, therefore, only natural that the system engineers and project leaders who face such challenges were delighted with his words.

Yokogawa’s transformation into a solutions provider was initiated with the introduction of ETS, and this continued with the launch of VigilantPlant. We are, indeed, in the process of further evolving our business, aiming in Japan to become a solutions provider that offers a high-added value business consulting service for companies engaged in businesses other than manufacturing. Namely, we will analyze problems and then suggest and execute solutions for the operation of factories and other facilities in which control systems will play an essential role. We will continue to evaluate the results of these solutions and use the insights gained to suggest further improvements.

In the global market, we will continue to pursue growth as a provider of total instrumentation solutions, primarily in the capacity of a main automation contractor (MAC).

Our value-added solutions will vary depending on whether they are for a new or existing facility. In either case, however, it will be important for us to evaluate the current situation and identify issues that will need to be addressed.

With an existing facility, we will start by either responding to already identified problems and needs or by conducting a survey to identify such problems and needs. These needs could include the desire to enhance capabilities without upgrading equipment, improve production and reduce the size of the workforce, integrate and visualize information in coordination with central control and upper-level management information systems, improve security and safety, reduce energy consumption, outsource maintenance services, or support a business operation in another country.

With a new facility, we seek when preparing our proposal to meet the customer’s cost and delivery schedule requirements while providing a solution that both adds value and performs the requested functions.

Here, our global network of project leaders and system engineers

demonstrate their strengths. As will be discussed in greater detail later on, project leaders have every type of standard manual and a full range of Yokogawa package solutions and products at their disposal, and are called on to oversee and motivate large numbers of personnel, engage in demanding negotiations with customers and partners, and create solutions. And even after submitting their proposals for large-scale projects, they must respond in a very timely fashion to countless inquiries from their customers.

It is here also that Yokogawa’s resolve to keep its promises shines through. For plant upgrade projects in Japan, we have professionals covering each industry who are intimately familiar with every detail at our customer sites and who work tenaciously together with the customer to identify problems and come up with solutions. And with large-scale projects outside Japan where deadlines are extremely tight, our employees work around the clock, if need be, to draw up and submit proposals on time.

What motivates Yokogawa’s people to work in this way? The answer to this question varies depending on which systems engineer or project leader you ask. One replied that it was only natural to want to meet the needs of

Yokogawa’s People Keep Their Promises—Yokogawa’s People Honor Their Commitments

Our Customer Approach

Overview of the ETS business, our first step in becoming a solutions provider

Comprehensive consulting services offered by Yokogawa Solution Service covering everything from field instrumentation to enterprise resource planning

Our VigilantPlant concept for realizing the ideal plant by achieving excellence in four areas

Big data

Enterprise resource planning Business planning, treasury management, logistics�

Operation management Production resource management,inventory control, logistics, quality control, traceability, operation improvement

Environment and resource improvement Environmental protection,energy management

Risk and safety management Information security, invasion monitoring, safety instrumented systems

Advanced operation assistance

Field networks,field wireless products

Networks,infrastructure

Business continuity planning

Process control Continuous, batch, discreet

Field instruments Sensors, actuators, analyzers, drives

Facility management Condition management, maintenance management,diagnosis

Data mining

Data on operations, quality, device management, etc.

Professional and Honest: the Yokogawa Approach to Delivering Solutions, from Solution Proposal to Project Execution


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customers who have placed their trust in Yokogawa and come to depend on us. Another answered that our honest and sincere approach gave us a leg up in the competition with companies that are both bigger and more experienced in carrying out projects outside Japan. Where they all agree is that, no matter how difficult the challenge, all of us at Yokogawa must first and foremost consider what we can do for our customers. As a result our customers develop a strong sense that Yokogawa is a company that keeps its promises.

Don’t expect smooth sailing once an order is booked and a project gets underway – challenges can and will come from every direction: disconnects between the worksite and management, partner organizations that do things differently, almost daily changes to specifications, problems with the recording of expenses…

Even when faced with a succession of such problems, however, Yokogawa’s

A little over 20 years have passed since Yokogawa’s solutions business began to flourish. With a corporate history that stretches back 100 years, this might well be considered a recent development. An effort is now underway to take this to the next level.

As a MAC, Yokogawa plays a central project role, with overall responsibility for measurement and control solutions. Not limiting ourselves to project implementation, we will focus on providing support over the entire lifecycle of a production facility, toward which end we will be engaged during the design and construction phases in the preparation of proposals for the long-term maintenance of facilities. This will make it possible for our customers to operate their plants more efficiently, and will allow Yokogawa to work with its customers over the long term to add value in a greater variety of ways.

In addition to helping companies improve the efficiency of their production operations, Yokogawa is keen to work with enterprises engaged in infrastructure-related and other non-manufacturing lines of business by offering solutions that address a wider variety of needs in areas such as technology development, procurement, logistics, and services.

Yokogawa will work with its customers to provide solutions that create a brighter future. With this strategy, the trust that our customers place in us is indispensable.

just one example, at a worksite where productivity had not improved for over 10 years we analyzed data to identify problems and proposed solutions that ended up reducing costs by hundreds of millions of yen. Such cases are commonplace here at Yokogawa, thanks to outstanding employees with long track records of success.

When asked to make changes to specifications, we do not refuse even if this is inconvenient for cost or

scheduling reasons. Our first priority is to deliver a plant solution that fully meets a customer’s needs. Once a facility is fully operational, we expect that our customer will recognize the value of what Yokogawa has provided, and only then do we ask for payment in full.

This is made possible by having the necessary systems and structures in place. On an internal company basis, this is accomplished by maintaining certification systems and sharing information on successful approaches; internationally, this is done through the development of global engineering standards and continually striving to make systematic improvements.

A key factor that enables Yokogawa to come through and honor its project commitments to its customers is that we are a provider of a truly comprehensive set of solutions for plant operations. As stated earlier, we base our proposals on an analysis of the problems that our customers

need to address. Our implementation of solutions draws on field sensors of every type, and Yokogawa’s flagship product, the CENTUM control system. We are able to deploy personnel who are specialized in control technologies and in the manufacturing execution systems (MES) that link production operations with the management layer, and provide consulting services for the post implementation phase.

To provide enhanced support services to our customers, we position solution service centers near their sites. We are one of exceptionally few companies with the wide range of expertise in production operations needed to develop and offer rich and versatile manufacturing execution and management package solutions. Indeed, this is one of the main reasons why many major IT vendors and information system integrators seek to collaborate with Yokogawa.

To better promote Yokogawa’s comprehensive solutions in the international marketplace, we came up with the VigilantPlant vision for systems that, even when unseen events unfold, vigilantly maintain control over entire production facilities while also gathering, analyzing, and sharing information. VigilantPlant embodies the Yokogawa approach of steadfastly going the extra mile for its customers in response to their challenges and needs.

Global response centers that provide an extensive range of after-sales support services. Ready at all times to respond to customer requests

Challenges Keep Coming Even After a Project Order Is Booked

Looking beyond Our Role as a Main Automation Contractor (MAC)

solution teams confront them head on. If management and personnel at the worksite don’t see eye to eye, we analyze the data gathered by CENTUM and other systems, draw up proposals based on concrete figures, and work to bring both sides to an agreement. What makes the difference is our wide ranging measurement and control experience in every type of industry and our ability to utilize this knowhow to improve operations at the worksite. To cite

Evolution of Business Models

Innovate by identifying needs that customersare not aware of and presenting solutions.

(Fulill dreams)

Provide optimized solutions thatmeet specific customer needs.

(Create solutions)

Supply superior products thatmeet basic customer need.

(Sell things)

Advanced

Applied

Foundation

Announced in May 2015, an evolution of our business model that aims to identify and meet latent customer needs through value co-creation

Central engineering centers play a central role in strengthening our engineering capabilities by gathering and sharing engineering know-how around the world

Comprehensive SolutionsBacked by a Wealth of Expertise in Production Operations

C E C

Know-how,infomation

Work process,document

Projectparticipation

Yokogawa’s Engineering Organization

Sigapore

CEC HQ

Tokyo

CEC

Bangarore

CECEngineering

office

Engineering office

Engineering office

Wuxi

CEC

Manira

CEC

Bucharest

CEC


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High Quality Solutions for Global Customers —the International Development of Yokogawa

Following the announcement of the One Global YOKOGAWA initiative in the 2000s, Yokogawa sought to make itself into a global solutions and service company by restructuring its businesses and training its personnel.

Yokogawa was always intent on developing an international presence. In 1919, not long after its establishment, Yokogawa began exporting products through a trading company. As its business continued to grow, the company exhibited its products at an international exposition that was held in Belgium in 1930, and its representatives

Transitioning from Indirect Exports to Direct Sales

traveled throughout Europe to gather information about the latest technologies. Such efforts continued in Europe and North America immediately after the war, and provided the company an opportunity to refocus on industrial instruments: a tie-up with the Foxboro Company, a major US manufacturer of control equipment, helped Yokogawa refine its technologies and products, and set the company on a path that would eventually lead it into the industrial automation field.

Starting with the opening of an office in New York in 1957, Yokogawa moved

quickly into other international markets, establishing offices and other facilities in Europe, Southeast Asia, South America, and the Middle East, and capitalizing on the development of industry in each region. The company also took a step that was ahead of its time for a Japanese company, launching knockdown production in China in 1980.

After the merger with Hokushin Electric Works in 1983, the development of our international business entered a new stage. Hokushin Electric had both personnel who were well versed in the market and a wealth of technologies, was strong in the oil and steel industries, and dealt in products such as control systems and equipment including industrial computers, aircraft instruments, and professional-use film projectors. By using the strengths of both companies, the plan was to expand our global business and open offices in Australia, India, and other markets. The importance of these moves increased as the Japan market matured and Japanese manufacturers began offshoring their operations.

However, as Yokogawa was not as well known internationally as it was in its home market, our international business had to withstand hardships until the time was right. Throughout the 1980s and 1990s, Yokogawa endeavored to increase orders by emphasizing the formation of long-term trust-based relationships with major companies in the oil industry and other fields. The company focused its energies on making its products and technical strengths more appealing and on building a stronger customer base in the global market. These steady efforts have resulted in the rapid expansion of sales outside Japan since the year 2000.

Growth was also spurred on by the Vigilance marketing campaign launched for our control business in 2003 and the VigilantPlant initiative announced in 2005. These strategies, which draw attention to Yokogawa’s emphasis on high product reliability and continuous attentiveness to the operations at its customers’ plants, made a great contribution to increasing market recognition of the Yokogawa brand, and were applauded by employees of our Group companies outside Japan for their emphasis on pride and unity. This also smoothed the way in our efforts to localize our operations outside Japan. With the establishment of Yokogawa Electric International Pte. Ltd. in Singapore in April 2005 to oversee our global control business, Yokogawa showed its desire to move on to the next

stage of globalization. At this time 20% to 30% of our sales were coming from outside Japan, and by 2006 this had passed the 50% mark.

By the 2010s, over one half of our employees were based outside Japan. With the aim of becoming the global No. 1 control company, Yokogawa has been carrying out a growth strategy centering on the control business and carrying out structural reforms to increase its global competitiveness. Our efforts at localizing our international operations have been successful because they have been rooted in a desire to act in the best interests of the people there, and our next step is to construct optimized systems for the entire Yokogawa Group that make maximum use of each region’s strengths.

Our knowhow and expertise in the oil & gas, power, chemical, and other industries is being shared and put to use on a global scale. Yokogawa has also established Central Engineering Centers (CECs) at various locations around the world that bring together expertise in engineering and project execution, thereby enabling us to provide high-quality and responsive engineering services to our customers wherever they may be. Regarding product development, while much of this function

is still centered in Japan, our offices in other countries are playing a role now in developing highly specialized products and software in those areas that are their strengths, and this is resulting in the creation of globally competitive products and solutions.

Our manufacturing operations continue to focus on high-variety, small-lot production, and our production of control and measurement products is centered mainly in Japan, China, Singapore, Indonesia, and Korea. In cooperation with Group companies that are engaged in the knockdown production of products customized for local markets, the company is constructing systems that will enable it to promptly deliver high-quality products to its customers around the world. Wherever we do business, we emphasize putting quality first and ensuring customer satisfaction by providing products that are globally uniform in quality and reliability.

These systems have been highly effective, enabling Yokogawa to provide the same high-quality solution services all over the world. As a result, we are undeniably the top control business in Japan. We also hold the top position throughout Asia, and are targeting the global No. 1 position in the medium to long term.

Business Expansion Targeting the Global Market

Aiming to Be the Global No. 1 in the Control Business


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Yokogawa opened a representative office in West Germany in 1966. In order to expand its business in the highly competitive European market, the company established Yokogawa Electric (Europe) B.V. in the Netherlands in 1974. Yokogawa’s next major move came with the acquisition in 1982 of Electrofact, a renowned Dutch manufacturer of pH and conductivity analyzers that held the top share in several major West European markets, and the handing over of its European industrial instruments business to this company. This acquisition had a great impact in terms of giving Yokogawa access to the Electrofact network, which extended throughout all major European markets. Rather than manufacturing Yokogawa products, Electrofact promoted its own line of analytical instruments until 1984, when it was integrated into the Yokogawa Electric (Europe) business. In 1990 this company was renamed Yokogawa Europe B.V.

In the same year, Yokogawa bought a stake in ROTA, a globally well-known manufacturer of variable area flowmeters. Yokogawa eventually acquired a controlling interest in this company and based some of its flowmeter production there.

In 1992 Yokogawa strengthened its customer base by acquiring the DCS business division of CEGELEC, a French engineering company, and establishing it as Yokogawa Contrôle Bailey S.A. (This company was later integrated into Yokogawa France S.A.S.) In addition to capitalizing on these companies’ regional relationships to develop its business in Europe, Yokogawa also benefited from their strengths that extend beyond Europe to the global market.

Yokogawa started exporting to China in the 1950s and established a service center in Beijing in 1979. That same year the company signed a knockdown production contract for analog meters with Xian Instruments Factory, and began a process of transferring recorder, flowmeter, single loop controller, and other product technologies to companies throughout China. Yokogawa also helped establish a measurement engineering department at a university in Xian. The business with Xian Instruments Factory expanded to the point where Xiyi Yokogawa Co., Ltd., China’s first control systems engineering company, was established in 1985. Expansion of our business in China continued with the establishment of joint ventures for sales, service, and production with partner companies suited for each industry and product. The Suzhou Yokogawa Meter Company was established in 1988 to produce meters, and today it supplies meters to our customers all over the world. Established in 1994 and 1995, respectively, Yokogawa Shanghai Instrumentation produces flowmeters and Yokogawa Sichuan Instrument produces transmitters. In 2000, Yokogawa Shanghai Trading was established to expand the measuring instrument business. In 2002, Yokogawa established Yokogawa Electric China Co., Ltd., its first wholly owned subsidiary in China, and this company launched production of recorders in the following year. In 2008, three sales subsidiaries in China were merged to form Yokogawa China Co., Ltd., which functioned as the head office for all of Yokogawa’s subsidiaries in China. Currently, Yokogawa China is working to expand its business in cooperation with Yokogawa China Investment Co., Ltd., which was established in 2012 to function as the regional headquarters.

Yokogawa Europe（The Netherlands）

Yokogawa China（China）

Yokogawa Middle East & Africa（Bahrain）

Yokogawa Electric InternationalYokogawa Engineering Asia（Singapore）

KoreaIn cooperation with Woojin Instruments, a top manufacturer of industrial instruments, Yokogawa launched the knockdown production of industrial instruments in Korea in 1977. In 1978, the two companies formed the Woojin Yokogawa Engineering joint venture. This was renamed Yokogawa Electric Korea in 1983 and became a wholly owned subsidiary of Yokogawa in April 1998. In 2012, Yokogawa Instruments Korea, a measuring instrument sales company that had been established in 1991 through the acquisition of a Yokogawa distributor, was merged into Yokogawa Electric Korea. The company’s operations have grown to the point where it is able to take on large-scale projects. In 2002, it spun off its production operations to form Yokogawa Electronics Manufacturing Korea Co., Ltd., which presently functions as Yokogawa’s central production organization in Korea for temperature controllers, PLCs, and other types of products.

CISIn the 1960s, Yokogawa started doing business in Russia via a trading company and a plant manufacturer. Following the dissolution of the Soviet

In 1974, Yokogawa established its first manufacturing company outside Japan, Yokogawa Electric Singapore Pte. Ltd., and began manufacturing meters there the following year. This company’s factory received great praise throughout the region due to its excellent quality control and manufacturing technology, and it was referred to as a model factory by the Singapore Economic Development Board. Operations were expanded there in 1975 with the establishment of a sales and service company, and the establishment of an engineering company in 1986. In 1988, these two companies merged, and this organization was then integrated with the manufacturing operations of Yokogawa Electric Singapore in 1990 to form Yokogawa Electric Asia Pte. Ltd., thereby bringing manufacturing, order processing, engineering, and services under the same roof. In 1997, Yokogawa Electric Asia’s sales, engineering, and service functions were transferred to the newly established Yokogawa Engineering Asia Pte. Ltd. Functioning as the ASEAN headquarters, Yokogawa Engineering Asia oversaw the establishment of sales and service offices and the development of Yokogawa’s business throughout this region. In 2004, certain of Yokogawa Electric’s development functions were transferred to the Singapore Development Center, which had been established to develop control system application software. Yokogawa’s Singapore operations went on to play an even more central role in 2005 when Yokogawa Electric International Pte. Ltd. was established to oversee the entire non-Japan control business. Yokogawa Electric Asia subsequently established production operations in Indonesia, and today plays an important role in the production of Yokogawa’s core products, including the flagship CENTUM integrated production control system.

Union and the formation of the Commonwealth of Independent States (CIS), Yokogawa’s interest in this expanding market continued to grow. In 1993, the company opened a representative office in Moscow, and in 1997 Yokogawa Electric Limited was established to handle sales, engineering, and services. Reflecting the importance of this market, which continues to grow due to the abundance of natural resources, the letters CIS were added to the company name in 2005. Subsidiaries were established in Kazakhstan and the Ukraine, branch offices and technical centers were established in various CIS countries, and strong relationships have been built up with leading global energy companies.

IndiaYokogawa launched manufacturing operations through the formation of Yokogawa Keonics Ltd., a joint venture with the Yokogawa distributor Blue Star and the Karnataka state-owned company Keonics in 1987. One year following the dissolution of this joint venture in 2003, Yokogawa India Ltd. was established with the aim of building strong relationships with customers in core industries such as oil, petrochemicals, and electric power. In 1994,

Yokogawa Corporation of America（U.S.）

In 1957, Yokogawa established Yokogawa Electric Works, Inc. in New York. This was a major step forward for the company as it was Yokogawa’s first subsidiary outside Japan, and it was entering the technologically advanced U.S. market.

Yokogawa worked to establish its presence in this market by, for example, exhibiting its products at the ISA Show in 1958. This was the company’s first time at this globally renowned measurement and control event. In 1968, Yokogawa Electric Works was renamed YEWTEC Corporation in order to strengthen the impression that it was a technology company, and in 1975 it became Yokogawa Corporation of America in order to emphasize its status as a subsidiary. In addition to helping to increase our sales and strengthen our services in the U.S. market, the company launched knockdown production of flowmeters and recorders at a plant in the Atlanta suburbs in 1980.

While these products were gaining acceptance in this market, the conclusion was reached that a strong partner would be needed in order to fully develop the systems product business in North America, which was the home of the automation business and a stronghold of veteran control businesses. In 1989, Yokogawa established a North American industrial automation joint venture with Johnson Controls, an influential automation company in the commercial air conditioning field.

However, this joint venture was dissolved in 1997 due to differences in management policies and corporate cultures and Yokogawa was once again working on its own to advance in the North American market.

With the growing market recognition of the Yokogawa name thanks to the company’s achievements with major oil companies, Yokogawa Corporation of America established an engineering center in the energy hub of Houston in 2002, and moved its headquarters there in 2010. Currently, the company has subsidiaries in Canada and Mexico, and is planning to expand its business by targeting opportunities in areas such as offshore and shale oil and gas field development.

an engineering center was established, and this is playing a key role in supplying the Yokogawa Group with engineering resources.

AustraliaYokogawa and a distributor jointly established the sales company Yokogawa Parameters Pty. Ltd. in 1987. In 1989, Yokogawa set up Yokogawa Australia Pty. Ltd. as a wholly owned subsidiary. In 1998, Yokogawa acquired another company’s business division that develops training simulators for the power industry. (This would later be merged into Yokogawa Australia.) Presently, Yokogawa Australia has a large share of the control market in Australia, including in the electric power sector.

TaiwanYokogawa established the Yokogawa Taiwan Corporation joint venture in 1989 to strengthen its industrial instrument sales and engineering functions in Taiwan. As the joint venture partner was dissolved at the time of the establishment of this company, all of that company’s employees, offices, and service capabilities were transferred to Yokogawa, which continues its operations in this market today.

Europe

China

A representative office was established in Iran in 1976, but was subsequently closed. In 1981, the Yokogawa Middle East Engineering & Service Center was opened in Kuwait to prepare for the full-scale development of our business in the Middle East. In 1990, in order to strengthen our sales and service systems, Yokogawa Middle East E.C. was opened in Bahrain, which is a transportation hub in the Middle East and has relatively few religious restrictions.

The Middle East is a major market, and many plants are being constructed there due to that region’s abundance of natural resources and great wealth, yet it differs from the European and North American markets in that there is relatively little competition from local companies. Yokogawa has expanded its business there by building strong customer relationships based on trust and by acquiring a solid track record with influential customers, such as state-run businesses.

Control systems engineering subsidiaries were established in Bahrain in 2005 and in the United Arab Emirates in 2006, and a sales subsidiary

was established in Saudi Arabia in 2006, followed by a service company in 2007. Yokogawa has maintained a stance in which it works closely with its counterparts in the region by, for example, providing training support for measurement and control personnel in cooperation with local universities in Saudi Arabia, and by employing both male and female local pensonnel. Such initiatives have helped Yokogawa establish a strong presence in the Middle East, and this is now one of our most important markets. And in line with the growing global interest in the African market, Yokogawa Middle East E.C. elected in 2013 to change its name to Yokogawa Middle East & Africa B.S.C.(c), and is presently expanding its efforts to develop its business throughout the African continent.

Middle East

Yokogawa Electric Corporation

Japan

North America

Southeast Asia


BrazilYokogawa Eletrica do Brasil Industria e Com. Ltda. started business in 1973 as a sales company. In the latter half of the 1970s, stronger import restrictions were put in place by the government of Brazil to protect the local electronic equipment industry, so in 1983 Yokogawa transferred its technology to the Brazilian company ECIL S.A. so that the production of distributed control systems could continue. With the discontinuation of these protectionist policies in 1992, Yokogawa immediately acquired a stake in ECIL P&D. In the following year, Yokogawa became this company’s majority shareholder and renamed it Yokogawa America do Sul Ltda. In 1998, Yokogawa Eletrica do Brasil was merged into this company, and Yokogawa America do Sul went on to open branch offices and establish subsidiaries in Chile, Argentina, Columbia, and Peru. Today, this company continues to play an important role in developing Yokogawa’s business in this key South American market that has good prospects for growth.

Spain, the United Kingdom, and Japan participated in phase I of the project (Rabigh I), a $9.8 billion (approximately 1 trillion yen) undertaking that was launched at the end of 2005. Yokogawa’s selection as the main automation contractor (MAC), in which capacity it oversaw all automation-related supply, engineering, and commissioning activities including the simultaneous execution of 10 engineering, procurement and construction (EPC) packages, was based on the client’s wish to assign project execution to a single entity and thereby standardize equipment and system specifications that normally vary greatly among different plant contractors, reduce operating burdens, and cut both materials procurement and maintenance costs. Yokogawa’s selection as a MAC for such a complex project was a manifestation of the trust and confidence that it earned through years of meticulous effort and high performance.

Yokogawa’s strong reputation in the global marketplace is the result of its advanced technologies, the high quality and reliability of its products, and its ability to consistently provide solutions that put the customer first, all of which are facilitated by a super-efficient

project engineering support system and organization. No two projects that the company is engaged in are alike, differing even within the same industry in terms of scale, specifications, site type, schedule, and the manner in which end-users, contractors, and their personnel go about their tasks. In the case of an international project, this is compounded by differences in culture, customs, and business practices.

The accumulated experience and know-how as well as the project management tools that Yokogawa employees have at their disposal serve as strengths, but in the end, the results that they achieve depend in good part on their individual capabilities. What should be done for the benefit of the customer, and how can individual staff members and teams of employees put their skills into practice to bring a

project to a successful conclusion? The required methodology, approach, innovativeness, values, and knowledge have been handed down through generations of Yokogawa employees, and this capability to effectively execute projects, along with our technologies and products, are Yokogawa strengths.

This ability to get things done has been displayed in a megaproject that is being conducted by Rabigh Refining and Petrochemical Company (Petro Rabigh), a joint venture between the Saudi Arabian Oil Company (Saudi Aramco)—a state-owned oil company—and Sumitomo Chemical Co., Ltd. The project involves the construction of one of the world’s largest oil refining and petrochemical complexes1 on the Red Sea coast of the Arabian Peninsula.

Eight leading plant design and construction contractors from Italy,

From the onset of the project, a major challenge was the need to manage the multiple industry-leading plant contractors in geographically dispersed locations who had been entrusted with different parts of the project. Yokogawa’s values and tradition of putting the customer’s interests first earned it the trust of both Saudi Aramco, which demanded the very highest levels of quality, and Sumitomo Chemical, which staked its future prospects in Saudi Arabia on the project. Close collaboration and high-level synergy in contractual and technical matters with the contractors reinforced the customer’s trust and confirmed the soundness of the decision to select Yokogawa for this project.

Doing What’s Best for the Customer

Yokogawa Selected as MAC for Global Megaproject

A cross-company meeting for the Rabigh I project

Petro Rabigh II facility (under construction)

View of the Petro Rabigh complex

1 The 25 km2 site includes a 400,000 barrel/day oil refinery that is integrated with petrochemical production facilities capable of producing an annual total of 1.3 million tons of ethylene, 700,000 tons of propylene, 200,000 tons of propylene oxide, 900,000 tons of polyethylene, and 600,000 tons of mono ethylene glycol.

Excellent Execution of Megaprojects, as Demonstrated in the Petro Rabigh Project


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customer and emphasized Yokogawa’s principles of taking the customer’s perspective to address issues and honoring all commitments based on the motto “A commitment made is a commitment kept.” Through such efforts on the Petro Rabigh II project to meet localization requirements that it has never faced before, Yokogawa is demonstrating its ability to carry out projects successfully.

Yokogawa Saudi Arabia is stepping up its CSR programs by developing human resources in collaboration with eight universities and sponsoring events to promote greater social engagement by women. Yokogawa’s development of its Saudi engineering workforce will ensure that the high quality work needed to achieve highly efficient and stable operations at this complex is performed, and will also achieve the human resource development goals set out by the Saudi Arabian government. Yokogawa’s Saudi engineers will continue to add to their skills and abilities by carrying out projects in Saudi Arabia.

of all project work, personnel were brought in from Singapore, India, and the Philippines. And as each milestone was cleared, the various teams engaged in this project were given opportunity to celebrate their interim achievements, building morale and promoting a friendly and healthy rivalry.

The proactive identification and effective resolution of challenges and problems allowed project managers to maintain tight control over the project as a whole so that any new problems could be nipped in the bud. As a result, the execution of this project went very smoothly, and the Rabigh I facilities commenced operations on schedule in April 2009.

Yokogawa was highly praised by the customer for its work on Rabigh I, and was once again selected to serve as the MAC for the phase II project (Petro Rabigh II), a feasibility study for which was started in 2009. The Petro Rabigh II project involves the construction of a complex that will produce high added value petrochemical products. While much of Yokogawa’s work for Rabigh I was carried out in Singapore, Yokogawa

has committed to executing all the work for the Petro Rabigh II project in the Kingdom of Saudi Arabia and to hire local personnel, including technical staff, for this undertaking. This commitment is consistent with a Yokogawa principle that emphasizes the local development of human resources wherever it operates and is in alignment with a program of the Saudi Arabian government that seeks to promote the development of a knowledge-based economy.

The total investment in Petro Rabigh II is approximately $8 billion.2 Five plant contractors from Saudi Arabia, Italy, and South Korea will install a total of nine EPC packages, and Yokogawa has been tasked with overseeing all instrumentation related aspects of the project as MAC. For this project, Yokogawa has been asked to meet a 50% localization target for all procurement and manufacturing, and for Saudi nationals to make up at least 20% of its workforce.

The experience gained on the Rabigh I project has positioned us well for subsequent project activities that include the hiring and training of local engineers; the development of strong manufacturing traditions through the local procurement of products; working with local project staff whose customs and practices differ considerably from those of Japan, other Asian countries, and the West; and coordinating the activities of teams made up of staff from other countries such as the Philippines and India.

To meet these challenges, Yokogawa has promoted to a senior position a Saudi national who was involved in the Rabigh I project, hired a former intern from a local university to serve as a project manager, and established a women-only Saudi work team that has been placed in charge of the preparation of computer graphics and planning documents. Yokogawa has prepared a plan to ramp up the project over an 11-month period, covering not only work but also the leisure activities of the project personnel. This has promoted a unified teamwork approach with the

Yokogawa has demonstrated its capabilities by carrying out projects all around the world in such markets as North America, Europe, Asia, the Middle East, Africa, and South America. The company will continue to work to break down barriers to international and inter-company cooperation, and will foster the development of a workforce that is willing and able to meet challenges, overcome difficulties, and bring projects to a successful conclusion.


Within Yokogawa, eight project managers and more than 150 technical staff were engaged in the project. The project director carefully examined the contractual requirements and the customer’s requests, projected what issues would need to be addressed, and prepared possible countermeasures based on the fundamental idea of “Think Ahead, Be Prepared.” The eight project managers signed agreements with the project director committing themselves to the achievement of specific project goals. As a result, the tasks that fell within Yokogawa’s areas of responsibility proceeded so smoothly that the customer commended Yokogawa by proclaiming, “You’re always on schedule.”

To ensure on-time delivery of 1,150 cabinets for the production control system that was at the heart of operations at the Rabigh complex, Yokogawa gave its production subsidiary advance notice of this order so that it could allocate sufficient production capacity. The company set up operations on three floors in two office buildings in Singapore, and linked them by running a fiber optic cable between the buildings. These were just a few of the innovative practices that were firsts for Yokogawa in this project. To ensure smooth and timely execution

Petro Rabigh II –The Challenge of Providing Local Content

Advancing Together through the Development of Saudi Human Resources

A team building bowling event for Rabigh I project

Petro Rabigh II factory acceptance test at Yokogawa Saudi Arabia

2 The expansion of an existing ethane cracker and construction of a new aromatics complex will enable an additional 30 million standard cubic feet of ethane to be processed daily. That and the approximately 3 million tons of naphtha produced annually will serve as the main feedstocks for the production of a variety of high value-added petrochemical products.

Yokogawa Saudi Arabia’s headquarters

Rabigh I facility in operation

Think Ahead, Be Prepared

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The basic concept for CSR at Yokogawa is building a sustainable society through broad-ranging activities in the areas of measurement, control, and information. This concept is based on the ideas of our founder and it underlies everything Yokogawa has accomplished with its business up to this point.

With his founding principles of putting quality first, having a pioneering spirit, and contributing to society, our founder Tamisuke Yokogawa made clear that the relationship between business and society is to be taken seriously.

These ideas and the essential nature of our business, which involves the use of measurement and control for the development of industry, determine the path that the company will take to support both companies and society.

In 1988, a Yokogawa corporate philosophy was formulated that reconfirmed the company’s mission. These ideas have gained Groupwide acceptance.

The contributions made by Yokogawa have evolved over the years to include everything from the provision of product solutions that add value to the offering

of support services that ensure the correct, safe, and reliable operation and management of entire production facilities, the improvement of operational efficiency, and the safe suspension of operations when errors occur. Today, Yokogawa is engaged in providing control equipment and systems for renewable energy applications, including wind, solar, and geothermal power generation, and is achieving significant growth in those fields.

Based on the idea incorporated in our corporate philosophy that Yokogawa’s people are to be good citizens, the company has sought throughout its 100 year history to be engaged at the local community level. While always placing the top priority on compliance, Yokogawa has continually striven to be sincere and cooperative in its dealings with people around the world, which has given rise to initiatives such as the sponsoring of events and volunteer activities. This includes activities such as the Yokogawa summer festival, initiatives through special subsidiaries that aim to help disabled people lead independent lifestyles, and the training of personnel in

other countries.Yokogawa takes its global

responsibilities seriously, and has shown its intent to work toward the realization of a sustainable society by participating in the UN Global Compact. Dedicated to its ten principles on human rights, labor, the environment, and anti-corruption, the entire Group is seeking to maintain compliance with regional regulations and international standards, and is engaged in dialogue with its stakeholders on these topics.

At Yokogawa, our CSR efforts can be described as creating new value with customers and engaging in a Business to Business to Community (B to B to C) model that seeks to pave the way to a brighter future for our customers, industry, and the Earth. The aim is to supply products and solution services that take into account not only the needs of our customers but also the communities that we live in and the Earth that we all call home. The words of our founder, who exhorted us to “become known by all people in the world and make products beneficial to them,” continue to resonate with us today.

1. Contributing to Society through Our Business

Yokogawa supplies products and solution services that support efficient, safe, and secure production and help to address major issues of global importance, such as the need to reduce energy consumption and use clean energy sources. The company helps its customers increase their competitiveness by providing products and solution services that can accurately ascertain their operational status and environmental load, optimize the control of operations, and adapt to any unexpected situation. Yokogawa also supplies the measuring instruments that are referred to in the industry as “mother tools,” and supports the development and production of superior products.

The Relationship between Business and Society

Good Citizenship

Contributing to Society, People, and the Earth

Yokogawa supplied control system solutions that reduced both the environmental burden and cost of operating two boilers and four sets of turbine generators at one of Kaneka Corporation’s main chemical plants. In addition to achieving a 1,000 ton reduction in CO2 emissions, alarm situations were reduced 85%.

As a MAC, Yokogawa was involved from the early stages in planning the control solutions for a second-generation bioethanol production facility for the Brazilian company GranBio Investimentos. Obtained from non-food organic sources such as wood chips and straw, bioethanol is often mentioned as a clean energy source that can replace fossil fuels. By optimizing the control systems and field instruments at these facilities, Yokogawa is helping to increase productivity and reduce operator and engineer workload over the entire plant lifecycle.

As the main automation contractor (MAC) for the Map Ta Phut Olefins petrochemical industrial complex project in Thailand, Yokogawa helped reduce maintenance and engineering costs by maintaining consistency in the control system equipment specifications. The company also enhanced safety and efficiency by integrating this facility’s production control and safety instrumented systems.

(1) Training of technical personnel

In addition to expanding the technical centers that it operates at 10 plants in Russia and other countries in the Commonwealth of Independent States (CIS), Yokogawa has established an automation training program at the Kazan National Research Technological University in the Republic of Tatarstan. In China, Yokogawa has donated 500,000 dollars to the Yokogawa Foundation of Training of Human Resources for Instrumentation in Commemoration of Su Tian, who was an influential figure in China’s measuring instrument industry, and has provided training in the measurement, control, and information fields to Chinese personnel.

(2) Employment of persons with disabilities

Since the passing of the Disabled Person Employment Promotion Act in Japan in 1960, Yokogawa has made a proactive effort to meet or exceed the mandated targets for the employment of persons with mental and developmental disabilities. For this purpose, Yokogawa established the

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Philanthropic activities

Regional disasterprevention activities

Support in education and employing people with disabitities

DonationsCharity activities

Employment of persons with disabilities(Establishment of special subsidiaries)

Contributing through regional volunteer activities

Anti-pollution measures

Energy saving activities

Entering the environment business

Acquisition of ISO14001 certification

Green procurement

Environmentally harmonious product development

Products and solutions that are good for the environment

Promotion of diversityForest conservationactivities

Construction of occupational health and safety management systems

GovernanceCompliance

Supply chainCSR guidelines

The present

* UN Global Compact and ISO26000

Quality first Pioneering spirit Contribution to society

Environment Human resources

LaborSafety

Fairness

Human rights

Local communities

Founding principles

Achieving a sustainable society through business-based CSR activities and complying with international standards*

Yokogawa’s expanding CSR activities

2. Being a Good Neighbor

As part of its efforts to be a good corporate citizen, Yokogawa is promoting initiatives that are helping to create a brighter future for people around the world.

subsidiary Yokogawa Foundry in September 1999. We are highly regarded for our efforts to motivate, provide opportunities to, and utilize the capabilities of disabled individuals based on the principle of “the right person for the right job” and the implementation of skills training.

(3) Youth workshops

In 2006, Yokogawa began offering science workshops that give elementary school students in the fifth and sixth grades the opportunity to work on projects such as building crystal radios and radiation thermometers. In addition to allowing these children to experience the joy of making something, these workshops help them develop an appreciation for how important science is and how rewarding it can be.

(4) Global environmental conservation

In conjunction with local governments and NPOs, personnel from Yokogawa offices in Tokyo, Kanagawa, and elsewhere have participated in forest coservation and other environmental activities in nearby rural

areas. This has helped to raise awareness of the importance of maintaining sustainable environmental practices.

(5) Cultural and scientific support

In addition to being a top architect, company founder Tamisuke Yokogawa was a collector of antique china. Following in his steps, the company has actively supported efforts to preserve traditional culture. This includes the funding of the creation of artistic works such as the ceiling paintings at Kenchoji temple in Kamakura and Kenninji temple in Kyoto (2000 and 2002, respectively), and the sliding door paintings at Nara’s Todaiji temple (2006), a designated World Heritage site.

(1) Ensuring safety (2) Reducing energy consumption and increasing efficiency

(3) Promoting the use of clean energy

Good CitizenshipCSR Initiatives

30 31


Sonny Markus

Sander Sprenger

Urszla Nietubyc

Jimmy Pootemans

Raman P. Pradeep

To be the global No.1 manufacturer

Fahad O. Al-Jahdali

Celebrating 100 years of global excellence.Aiming to transform Saudi industries as global leaders through world class services.

To continue to be a company in the next 100 years that passes down technology and provides products imbibed with the spirit of measurement.

From Yokogawa around the Globe

Yoichi Matsunami

Soobin LeeTakashi Nakayama

Let's be big, fabulous, and famous!

Indah Permatasari QinXi Xu Alwyn MisquithTo make Yokogawa a company that motivates employees and brings happiness.

Jan Rodenhuis

Makara Long Tooru Yamamoto

From Japan’s Number One to the world’s Number One.

Let's make the jump into new fields with the pride of Yokogawa inside us.

Looking ahead to our next 100 years.

Be customer, employee and knowledge centric.

Ashwini SugumaranTu Rong

Rain or shine, to put our strengths together into overcoming adversity. Growing together, persevering together, to attain brilliant achievements again.

Jochen Freudenthaler

Ric AndrewArinduque

Abel Tan Zi HaoNiwat WeeragulLim KhiawWah

Fredson Fernandes de Sousa

The dream company

Alicia Hui RongMatthijs Spaak

Happy 100th anniversary! I want to make Yokogawa a company that can contribute towards improving the environment in China.

Meidan Jin

Happy 100th anniversary to a cheerful and interesting company that enriches people's lives.

Taiji Miyamoto

Harsha A P

Happy 100th anniversary! Gratitude, heritage, progress - for our customers’ satisfaction.

Masayuki Kawashima

Things go better Yokogawa. Let's be our customers’ partner-of-choice.

Miho Saitou

Unafraid of change, pursuing progress, towards the next 100 years!

Youichi Nomura

Be a truly global company that embraces a global mindset and management practices but acts locally.

Azman Baharudin

Congratulations on 100 years of sucess. I wish Yokogawa a bright future. Ma Ling

Happy 100th anniversary! Our challenge - always striving to get better.

Yuji Natori

32 33


Wanli Sun

Sakeena AlAwami

Kang Sung Myung

Yu Jiajia

AsamiFujiwara

He Shanshan

I want to see Yokogawa’s leaders create more visionary plans and drive them to completion.

Yokogawa, doing its best for customers with great passion and vision.

To be recognized not only by customers for its excellent products but also by the entire society for its desire to make the world a better place.

May you achieve your targets!Innovation & Win-Win

Thamer Kamal

Yokogawa- every customer is our top priority.

I wish for Yokogawa to continue pioneering and leading the development of control & measurement systems technology.

Gerhard Post

Ingo Pichler

Lisa Kendall

Masako Okui

Maria Segovia Jifu Wang

Eileen Samson

Nguyen Thi Huong

Teamwork

Erika MottiSteve PooleKevin Wang

NatheerAl-Nasr

Gentarou Fukano

To be a stable, flexible, successful and innovative company that contributes to the development of my country.

May we continue to meet and exceed our customers' expectations.

Oleg Nekrasov

May growth and advancement accompany you!

Damilola Adebayo

Karen LingKae Lim

Yinka Sayomi

Yuuki Shimizu

Andy Bloodworth

R. Mahalakshmi Alberto Hideki Nabeshima

Victor Guevara

Celebrating Yokogawa’s 100th anniversary. Aiming for further progress to be an even more magnificent company.

In our second century, let's keep this a cool company that is appreciated by its customers.

Happy 100th anniversary! A company that continues to be sought after by society and enriches people's lives.

Keep going Yokogawa! I am working hard too!

Miho Kokubo

A splendid company both for its employees and society - Yokogawa

To be a company that contributes to society through technology.

Fun company - Able to invest in development - Able to produce good products - Satisfied customers - Profitable

Yokogawa’s HistoryOur past 100 years

36 37


The Electric Meter Research Institute and Tamisuke YokogawaYokogawa originated from an electric meter research institute that was set up in Shibuya, Tokyo on September 1, 1915.

The small factory had only four staff: Ichiro Yokogawa (29, later the first president), Shin Aoki (26, later the first chief engineer), and two others. Even after the institute was renamed Yokogawa Electric Works in the spring of 1916, their main focus was on analyzing imported instruments and studying how to make similar ones. Yokogawa literally started from scratch.

Tamisuke Yokogawa (1864–1945), founder of Yokogawa, was a pioneer of modern Japanese architecture. He was born in Hyogo to the west of Osaka and graduated from the Department of Architecture, College of Engineering, Imperial University (currently, the Department of Architecture, Faculty of Engineering, University of Tokyo). He designed major buildings, including Japan’s first steel-frame structure for the Mitsui Main Building, the Yurakuza Theater, the Imperial Theatre, the Mitsukoshi Main Store in Nihonbashi, Tokyo, and the Tokyo Stock Exchange.

His modus operandi, which reveals his magnanimity as an architect, was not to draw designs himself but to instruct key points to his subordinates and let them get on with the designing. He produced architectural masterpieces mainly by utilizing the latest knowledge acquired by visiting Western

Becoming the Top Electric Meter Maker in JapanFollowing Western countries, Japan began to use electric lights in the 1880s. By 1912, light bulbs were in use throughout central Tokyo and a few railway lines had been electrified. However, electric meters were still all imports and the outbreak of World War I in 1914 made it difficult to import them from Western countries. There also was a movement to shift for the supply of electricity from flat-rate to tiered-rate plans, and so there was an urgent need to produce electric meters for Japanese industry.

After preparations were finished for the start up of factory operations, the electric meter research institute was renamed Yokogawa Electric Works. While planning for the mass-production of watt-hour meters, Yokogawa employees continued developing the industrial electric indicating meters that would prove indispensable in the safe and accurate control of electricity. In 1917, Yokogawa succeeded in developing prototypes that received high acclaim from universities and research institutions, and went on to release AC/DC ammeters, voltmeters, and other prototypes for portable and switchboard use. Yokogawa also created the industry’s first product catalog.

Yokogawa’s uncompromising pursuit of excellence, with executives themselves visiting customers to hear their opinions on Yokogawa products, earned it the cooperation of such entities as the Ministry of Communications, whose laboratory Ichiro Yokogawa and Shin Aoki once worked in. As a result, Yokogawa products came to have a high reputation. The timing for the establishment of Yokogawa was perfect, since electricity was providing over 50% of the energy required to run plants in Japan in 1917. Aoki played a central role in setting standards for electric indicating meters, which also demonstrated Yokogawa’s technological capabilities.

In 1918, Yokogawa constructed a two-story wooden factory building, and began strictly following a policy of “quality first.” Management pushed so hard that they often won orders for products that were still in development. Nevertheless, these pushy tactics enabled Yokogawa to master technologies quickly, and eventually to begin exporting products via a trading company in 1919.

With the number of employees reaching 110 in 1919, Yokogawa actively trained them through technology seminars and other means. The employee training led to an

countries and relying on an artistic sensibility that had been cultivated by studying and collecting Asian ceramics. He served as the president of the Architectural Institute of Japan (1925–1927).

He was a man of wide horizons, too. His business talents were acclaimed by business dignitaries of those days, such as Sanji Muto, then president of Kanegafuchi Spinning K.K. When Yokogawa was founded, Tamisuke had already set up such companies as Yokogawa Komusho (currently, Yokogawa Architects & Engineers, inc.) and Yokogawa Bridge Works (currently, Yokogawa Bridge Corp.). He even translated publications on Taylorism, a system of modern factory-management, to introduce it to Japan.

Tamisuke also considered starting businesses related to electricity, which was beginning to be widely used in Japan and was closely related with the field of architecture. He was advised that the electric meter business was promising because it could be started with relatively little capital and there were few competitors in Japan. He sent his nephew, Ichiro Yokogawa, who was working at the Ministry of Communications’ laboratory, to Germany to study electric meters. Moreover, he met Shin Aoki just before Aoki went to England, and promised him financial aid. Aoki was also working at the laboratory. With the support of Tamisuke, the two young engineers visited Western electric meter factories and returned home after procuring the equipment needed to start an electric meter research institute in Japan.

acceleration of the company’s research efforts and the development of an industry-leading production system. This featured division of labor, mass production, downsizing of instruments, and addition of high value. As a result, Yokogawa built a solid foundation for its business.

In 1920, having grown into a leading manufacturer in Japan in terms of product range and number of employees, Yokogawa was incorporated to modernize its management.

Oscillograph: an Early Main Product of YokogawaAfter the Great Kanto Earthquake in 1923, plants in Japan came to rely even more on electricity as an energy source, and the electricity billing system shifted completely to tiered-rate plans. While terminating the manufacturing of watt-hour meters that were less competitive in price, Yokogawa completed development of Japan’s first portable electromagnetic oscillograph in 1924, and it became a great hit. In addition to its low price (about half the price of imported models), the device had a number of improved features. This product won an honorary award at the 1926 Peace Exhibition in Ueno, Tokyo, a first for the measuring instrument industry. The oscillograph helped boost Yokogawa’s profile as a technology company, and continued to be a major source of income until the advent of Braun-type cathode-ray tube oscillographs after World War II.

Beginning in 1927, Japan was hit by a succession of economic crises. Yokogawa, however, weathered them by increasing the sales of oscillographs and releasing groups of products that incorporated Yokogawa technologies based on its many years of R&D. These products included DC watt-hour meters and portable high-frequency meters. A prototype of a cathode-ray oscillograph that can monitor micro-second level electric changes was completed in 1929 thanks to much hard work by staff as well as advice from many academics and electrotechnical laboratories, and soon dominated the market after its successful release.

As Yokogawa came to be known more widely, a trademark to clearly identify the brand became necessary. In 1927, Yokogawa registered YEW (Yokogawa Electric Works) as its trademark. In 1930, Yokogawa exhibited its precision measuring instruments, including cathode-ray oscillographs, at an overseas exhibition and won an honorary award, and thus Yokogawa products and YEW came to be known outside Japan.

From Company Founding to Postwar Reconstruction (1915–1947)

Yokogawa’s History —— Chapter 1

Shibuya factory in 1930

Scale marking

Ichiro Yokogawa Shin AokiTamisuke Yokogawa

Mitsui Main Building

Imperial Theatre

YEW trademark registered in 1927

Electric meter for switchboards

Portable ammeter

At the company's 10th anniversary

Portable oscillograph

38 39


Relocation to Kichijoji and Development of Control DevicesAs the number of employees increased to 300, the Shibuya factory became crowded, but there was no room to expand at this location. So, considering the need for a clean environment and accessibility, Yokogawa decided to move to Kichijoji and build a new factory there. This western suburb of Tokyo is where Yokogawa is currently headquartered. In the spring of 1930, a new two-story white factory building made of reinforced concrete was completed.

The new factory building had five laboratories (each of which was named after its manager), a design office, and manufacturing floors. Each laboratory conducted highly independent R&D of the type often seen in universities. These laboratories developed, for example, switchboard meters that could withstand rough long-distance transportation and graphic meters that could continuously record values for electric current, voltage, and power on band-like recording paper, a Japan first.

In 1932, Yokogawa started to develop gas analyzers and other industrial instruments, and in the following year, began working in automatic flow, temperature, and pressure controllers. Receiving patents for high-frequency power meters, pneumatic automatic equalizers, and other instruments in 1937, Yokogawa laid the foundation for entering the control business. These developments reflected the rise of the electrochemical industry in the 1930s, which increased demand for electricity and revitalized power resource development. This supplied added momentum for electricity-related companies like Yokogawa.

Yasushi Togo, the second president, tried to change Yokogawa’s job classifications and office organizations based on his experience at a large company, but just 18 months later he ceded his work to Tokisuke Yokogawa (Tamisuke’s eldest son) and Tokisuke officially became the president in 1940. Although orders for aircraft instruments and spark plugs increased dramatically and accounted for nearly 60% of total production volume, Yokogawa’s profitability dropped because of the shortage of materials and labor as well as controlled prices.

Yokogawa during the WartimeIn December 1941, Japan went to war against the US and Britain. In the following year, an industry association was formed by law to centrally control electric equipment makers. The production and distribution of goods and raw materials, as well as labor were strictly controlled. At the government’s request, Yokogawa started the expansion of the Kichijoji and Koganei factories in 1942 while raising funds from outside, and built three new factories in Okubo (Tokyo), Kawagoe (Saitama), and Tsujido (Kanagawa) in 1943. Although Yokogawa continued to develop new technologies and kept manufacturing industrial instruments on a small scale, work for the military took up almost all of Yokogawa’s resources. The number of regular employees was about 12,000 (16,000 including student labor). Sales for fiscal year 1944 exceeded 75 million yen, but loans soared to nearly 70 million yen,

Development of Aircraft Instruments and Wartime OperationsYokogawa entered the aircraft instrument field in the early 1930s. In 1930, Shin Aoki toured Europe and realized the potential of the aircraft instruments business. In 1933 Yokogawa started R&D of magnetos, spark plugs, tachometers, and other components for aviation use. In the same year, expansion of the Kichijoji factory started. The functions of the Shibuya factory were relocated to Kichijoji, and the headquarters function followed in 1935. Another tour of Western countries was made in 1936, and the development of aircraft instruments gathered speed.

In May 1937, Yokogawa built the Koganei factory to mass-produce spark plugs and magnetos for aircraft. In July of the same year, however, the Second Sino-Japanese War broke out and the economy was placed under tight control. As a result, the Koganei factory was designated by the army and the navy to supply products to them. The factory continued expanding, tripling both in floor space and number of employees, and production increasing more than seven-fold by 1941. Then, the Kichijoji factory was also ordered to mass-produce these two products. Both the Kichijoji and Koganei factories came under military control immediately before the outbreak of World War II, and Yokogawa could no longer run both factories as it liked.

In March 1938, Ichiro Yokogawa became the first president (a new position) and Shin Aoki became executive vice president. However, Ichiro died in June and Aoki in July, a huge loss to Yokogawa amid intensifying economic control.

reflecting the downside of war-time management.In 1945, the government issued evacuation orders and

Yokogawa had to leave Tokyo and head to distant places, including the foot of Mt. Fuji, where it rented buildings and continued operations.

In June 1945, company founder Tamisuke Yokogawa died aged 80, and in less than two months, the war ended.

Yokogawa Starts Afresh with One Tenth the Number of EmployeesIn September 1945, the management drew up a reconstruction plan to cut the number of employees to 1,200, newly hire 400, and restart operations at the Kichijoji and Koganei factories. While many companies struggled to survive by making other basic products such as pots and pans, Yokogawa stuck to a policy of not making second-rate products, and transferred equipment and materials from the evacuation sites back to rebuild itself. Meanwhile, in line with the postwar democracy, Yokogawa embraced the movement to form a labor union. A labor union was organized in Yokogawa in January 1946, confirming the bond between labor and management.

However, Yokogawa was losing about 2 million yen a month after the war, and was burdened with severance payments to employees who had left Yokogawa, the cost of bringing back materials from the evacuation sites, and other expenditures. Moreover, about three quarters of receivables from the military were nullified. Yokogawa overcame this financial crisis mainly by collecting other receivables, slashing expenditures, and selling the Tsujido factory.

In April 1946, Yokogawa managed to restart manufacturing measuring instruments. Everyone worked hard with determination to help reconstruct Japan by making measuring instruments, a “mother tool” for industry. Yokogawa’s labor union also staged a campaign to increase production. In 1947, while going ahead with screening and standardizing parts to enhance efficiency and profitability, Yokogawa held an exhibition of its measuring instruments at the Matsuzakaya department store in Ginza, Tokyo to publicize its quality and technology. Thus, Yokogawa embarked on its postwar growth.

The Kichijoji factory in the 1930s

The Tomota laboratory

Aerial photo of the Kichijoji factory Workshop at the Kichijoji factory

Advertisement in October 1928 magazine

Yasushi Togo Tokisuke Yokogawa

High-accuracy resistor

Electric differential pressure flowmeter


Test of pivots at the Kichijoji factory

Indicator for the navy

40 41


From Reconstruction to RecoveryYokogawa managed to rebuild its business after the war and initially focused on telecommunications infrastructure for the Ministry of Communication (predecessor of Nippon Telegraph and Telephone Public Corporation, and today’s NTT Group) and electric power companies, which were carrying out many projects for the reconstruction of Japan. The year after the war ended, Yokogawa won a line tester order from the Ministry of Communication, which was working hard to rebuild and improve the telephone and telegraph networks. After two years of R&Ds, Yokogawa shipped the first line tester in 1948.

The line tester is an instrument that monitors and measures transmissions between relay stations and terminal stations for long-distance telecommunications. It is composed of an audio CR oscillator (the first such product in Japan),1 a power controller, and a level meter, which are all mounted on an iron stand. Yokogawa’s line tester was highly acclaimed and several hundred sets were shipped for use in relay stations across Japan. This line tester was Yokogawa’s main product in those days.

At the same time, the number of orders from electric power companies increased, and thus Yokogawa continued to grow.

By selling its Koganei and Kawagoe factories, Yokogawa increased its capital and was able to go public in November 1948 (listed in May 1949), thus setting the stage for further growth.

In 1949, sales fell sharply as a result of the Dodge recession, and Yokogawa introduced technical conferences where employees could freely discuss research and development

Yokogawa started to develop electron tube (vacuum tube) type automatic control devices that were superior to the mechanical devices manufactured by various leading companies.

After great effort, Yokogawa shipped the first product, an electron-tube-type self-balancing recorder, or electronic recorder (ER), in

September 1951. Although many problems were found with the product after delivery and some people became pessimistic about the future of the company, Yokogawa was convinced it was on the right track and continued to make improvements. This firm commitment led to the development of various ER instruments for measuring frequency, temperature, flow rate, liquid level, pH, gas analysis, and sulfuric acid concentration.

Yokogawa stopped manufacturing large-sized shouldered tubes (ST) in 1952 and replaced them with the latest miniature tubes (MT). Yokogawa also introduced new specifications for chart paper, including 180 mm width paper and folded forms, and these were adopted by its US competitors.

The development of ER instruments was significant in three ways for Yokogawa. First, research and development by a team (cross-organizational project) was found to be advantageous. Second, Yokogawa became the first company in the industry to use electron tubes for industrial instruments, overtaking its competitors. And third, it helped Yokogawa take a leading position in the subsequent automation era and achieve significant growth.

Tie-ups with Two US CompaniesThe focus on industrial instruments helped to meet the needs of Japanese companies that were shifting from reconstruction to modernization. However, Yokogawa did not have sufficient technological knowledge and experience to respond to all these companies’ requirements, and its major competitors were expected to catch up soon. Therefore, in 1955, Yokogawa and Foxboro, then one of the four major industrial instrument manufacturers in the US, signed a technical assistance and Japan exclusive

trends and new products, and set up a committee for proposing efficiency improvements. In 1950, a planning department and planning committee were set up for strengthening management. Meanwhile, wartime price controls were lifted and corporate investment improved as a result of a surge in procurement for the Korean War, both of which benefited Yokogawa’s business.

An Overseas Visit and the Decision to Develop ER InstrumentsAround that time, two crucial events laid the foundation for Yokogawa’s subsequent growth. One was a visit by Senior Vice President Miyaji Tomota to the US and the other was the decision to develop electronic instruments for industrial use.

In December 1950, shortly after the ban on overseas travel was lifted, Mr. Tomota took a three-month trip to the US. He visited companies such as Hewlett-Packard and Bendix Aviation, both of which would form technical partnerships with Yokogawa, and discussed various matters with their staff. Exposure to these companies’ leading-edge technologies stimulated Yokogawa’s product development efforts. This tour and subsequent business communications with the US companies led Yokogawa to introduce advanced management tools such as IBM computers and to launch the mass-production of general-purpose items by small manufacturing subsidiaries (the division system, started in 1953). Through such means, Yokogawa was able to boldly consolidate products and specifications and thus overcome the sharp rise in raw material prices caused by the special procurement boom during the Korean War.

The trip also gave Yokogawa confidence in developing industrial instruments. A few years earlier, around 1948, there had been heated debate within Yokogawa on which business to focus on: industrial instruments, for which demand was expected to increase on the back of the growing oil and chemical industries, or measuring instruments for communications and aviation, in which Yokogawa had a solid track record. Yokogawa subsequently decided to focus on industrial instruments, with an eye on expanding automation in the US and Europe, and this business trip supported that decision.

distribution agreenment. In the same year Yokogawa signed a technology and sales agreement with Bendix for aviation products such as the Ultra-Viscoson viscometer, magnetos, harnesses, and ignition devices.

The tie-up with Foxboro was not ideal for Yokogawa as it did not allow us to modify any of the specifications for that company’s products. Despite this disadvantage, it helped us meet our customers’ needs for a broader lineup of mechanical (pneumatic) instruments and improve our machining skills. Thanks to this tie-up, Yokogawa was also able to produce an electron-tube-type automatic recording controller (ERZ electronic recorder) that combined our ER with Foxboro’s pneumatic controlling mechanism. This recorder sold well.

Rapid Economic Growth Era in JapanIn the 1950s, Yokogawa not only delivered industrial instruments to customers but also got involved in instrumentation projects at steel, chemical, and electric power companies. Japan’s economy continued to grow rapidly during three consecutive, unprecedented economic booms, and capital investment by companies continued to increase steadily. Yokogawa also expanded its business in this period. For example, in 1956, we completed development of an analogue computer for the measurement and analysis of the voltage, current, and power conditions of electricity distribution grids, and also founded Yokogawa Aviation Co., Ltd. to manufacture aviation devices. During this period, Yokogawa also rebuilt its main factory and started entering the US, Taiwan, and other overseas markets.

Yokogawa developed the ECS series of electronic control systems in 1959, which fueled the company’s dramatic growth. The ECS was compact thanks to the use of transistors and diodes. All measurement values were converted into unified voltage signals of 0–10 mV for communication, ensuring compatibility with other instruments and facilitating modularization and mass-production. With the ECS for large plants and the pneumatic control system for small plants, Yokogawa received increasing numbers of instrumentation orders to automate factories and water facilities. Sales surged from 1.7 billion yen in 1955 to 7.3 billion yen in 1960. In the same year, Iwao Yamasaki became the president and steered Yokogawa through Japan’s further economic growth and open economy policy.


The Foxboro headquarters ECSWide-angle instrument

Line tester

ER electron-tube-type self-balancing recorder

Iwao Yamasaki

1 Anoscillatorgeneratesfixed-amplitude,-frequencypulsesusingaDCpowersourcewithoutexternalinputs."CR"standsforcondenserandresistor.CRoscillatorsaremainlyforlowfrequenciesandcanbedownsized.

From Postwar Recovery to Rapid Economic Growth and Oil Crisis (1948–1974)

Ionosphere measuring instrument mounted inside a NASA rocket

42 43


Intensified CompetitionIn the 1960s, major electric companies such as Hitachi, Toshiba, Mitsubishi Electric, and Fuji Electric entered the measuring and industrial instrument fields.

Although Yokogawa had an approximately 30% share of the measuring instrument market in Japan at that time, President Yamasaki worked hard to strengthen Yokogawa’s position by streamlining operations and constructing a new R&D center (completed in July 1962). Following the set up of a US office in 1957, he also tried to expand exports by exploring communist bloc markets and signing agreements with distributors in North America, Europe, Asia, Australia, and Central and South America. In 1962, Yokogawa and Voltron Products Inc. (US) set up a joint venture, Acrohm Electronics, for manufacturing electric instruments in the US.

Regarding products, Yokogawa developed the COM-21 network analyzer for electric power companies in 1961, and a measuring instrument that was selected by NASA for use in ionosphere rocket experiments. A significant decision was made at this time to start developing digital control technology. Although Yokogawa was leading the automation

Kogyo K.K. for analyzers, CHINO Works (the current CHINO) for temperature controllers, Asahi Kohsan for instrumentation work, Hokushin Electric Works for recording paper, and IBM for computers.

End of the Rapid Economic Growth EraLeaving the high-frequency measuring instruments business to YHP, Yokogawa focused on growing its general measuring instruments, industrial instruments, and instrumentation systems businesses. When the stock market took a turn for the worse in 1965, sales declined for both Yokogawa and YHP. In 1966, Miyaji Tomota took over as Yokogawa’s president and sought to strengthen Yokogawa’s business by reducing the number of product models and overhauling the company’s administrative functions. Business conditions in Japan started to pick up again in November 1965 and remained strong until July 1970.

In terms of products, the launch of the CCS in 1962 was followed by the release of the YODIC-500, Japan’s first double CPU direct digital control (DDC) system, and the EBS, electronic control system, in 1966; and the YODIC-600, a fully duplex DDC system, in 1970. These products employed some of the same highly reliable technologies, that would later be used to develop the CENTUM integrated production control system.

Yokogawa also entered the process analysis instruments business. Starting with the release in 1966 of its first process gas chromatograph, which featured an ER for added value, Yokogawa continued to develop various technologies and by the 1980s had captured a 90% share of this market in Japan. In 1969 the company released a B/M meter (for use in paper mills to measure basis weight and moisture), and in 1970 the company came out with a sulfur content meter that would later be used to enter the US market.

To boost sales by strengthening relations with customers,

market thanks to its ER and ECS products and instrumentation work, the company believed that the core technology of the future would be digital computers rather than analog devices, and so decided to devote human resources to such projects, ahead of the competition. The first result was a computer control system (CCS) released in 1962 that performed centralized monitoring and control of plants and revolutionized central control room operations.

Setting Up of Yokogawa-Hewlett-PackardYokogawa sought a technical tie-up with Hewlett-Packard (HP) in the US to acquire expertise in high-frequency and microwave technologies that were becoming increasingly important in the electronics field.

The negotiations had a rough start because HP’s policy prohibited the provision of technology to anyone other than its wholly-owned subsidiaries. In April 1963, both parties finally agreed to set up a joint venture in Japan, and Yokogawa-Hewlett-Packard (YHP, the current Hewlett-Packard Japan) started operations in October of that year, with the main factory in Hachioji, Tokyo. (Of 500 million yen in capital, 51% was held by Yokogawa and 49% by HP.) YHP received certain technologies and components from HP, and manufactured high-frequency and microwave measuring instruments. The manufacturing of high-frequency measuring instruments was partly transferred from Yokogawa to YHP. In addition, Yokogawa formed tie-ups with other companies in order to expand its business, including Mitaka

the Tokyo branch office was relocated to Yaesu in central Tokyo. Administrative work efficiency was also improved greatly by introducing an IBM360 computer. And in the company’s manufacturing facilities, productivity started to rise with the introduction of leading-edge equipment and quality control activities.

However, the Japanese economy started to slow down after the Osaka Exposition in 1970, and the Nixon shock (dollar crisis) in 1971 caused great difficulties for most manufacturers, including Yokogawa. In 1971, when Toshinori Matsui became the Yokogawa president, the company had fallen behind its competitors in sales revenues. Yokogawa therefore acquired Nakaasa Instruments Co., Ltd., a meteorological instruments manufacturer, and signed a sales tie-up agreement with Tokyo Keiki for marine instruments in July 1972. In the same year, the company acquired land for a second production facility in Kofu, Yamanashi, where there was more space for future expansion.

However, in October 1973 when construction of the Kofu factory was just about to start, the first oil crisis struck, and all advanced economies, relying on oil-dependent mass-production and mass-consumption, entered recession. The Kofu factory, which was completed in July 1974, started operation amidst an economy that was shrinking for the first time since the war. Japan’s rapid economic growth ended and Yokogawa was forced to seek new avenues for growth in a slowly-growing economy.

Miyaji Tomota


YODIC-500 The Kofu factory

AC network analyzer

R&D center Signing ceremony to form YHP

Toshinori Matsui

Gas chromatograph Sulfur content meter

B/M meter

44 45


Overcoming DifficultiesIn November 1974, the year after the first oil crisis, Yokogawa welcomed a new president, Shozo Yokogawa, the third son of Tamisuke Yokogawa, the founder of Yokogawa. Shozo had been the president of Yokogawa-Hewlett-Packard since its foundation in 1963, and this company had grown quickly under his leadership. On assuming the presidency of Yokogawa, he clearly stated that he would value mutual understanding between labor and management, help everyone to enjoy work with a sense of purpose and make full use of their abilities, and increase our added value for the lasting growth of Yokogawa.

He also explained about measures that would be needed to overcome challenges that the company faced and identified that this would require everyone to think hard and identify changes in society’s needs; regain pride and recognize that measurement and control technologies are indispensable to society; improve communication skills; see things from the customer’s perspective; and share expertise by cooporating with colleagues. He also noted that he wanted to make Yokogawa a company where anyone could talk with anyone else, at anytime and anywhere.

For operators who were unfamiliar with CRTs, displays were modeled after conventional operator panels. This style was called a “virtual panel” and its originality and excellent design were highly evaluated. The virtual panel won several awards in Japan, including one from the Japan Society for the Promotion of Machine Industry in 1976.

After the oil crisis, manufacturers were struggling to survive by shedding manpower and saving energy; CENTUM helped them by assuring safe, efficient, and stable operations. In December 1985, 10 years after its first release, Yokogawa shipped the 1,000th CENTUM system. This proved that CENTUM was highly valued in the marketplace.

Around this time, sales were boosted by the development of a car exhaust measuring instrument that helped assure compliance with environmental protection requirements, and by cooporation in the medical equipment business with General Electric (GE). As a result, Yokogawa, which had suffered falling sales and income in fiscal year 1975, gradually recovered. By 1977, despite having had to furlough employees, the company was generating record-high orders and sales.

Entering the Medical Equipment MarketIn December 1976, Yokogawa set up a CT Division and entered the medical equipment market in September 1977 by selling GE’s computerized X-ray transaxial tomography system (CT). Yokogawa recognized the high potential of this field and aimed to make similar products in Japan. The business got off to a good start, and three GE gamma camera models and a vascular X-ray system were added to its product lineup in 1978 and 1979, respectively.

The CT Division was renamed the Medical Equipment (ME) Division in 1980. After adding Yokogawa’s diagnostic ultrasound imaging system and full-body CT scanner to the product lineup, the ME Division achieved growth and was spun off in 1982 to form Yokogawa Medical Systems (YMS, currently GE Healthcare Japan), a joint venture with GE.

CENTUM: the World’s First DCSIn June 1975, Yokogawa released CENTUM, the world’s first distributed control system (DCS) and the culmination of the company’s digital control technologies, expertise, and know-how. With conventional, centralized control systems, any failure in one computer affected the whole system and made it difficult to confine risk. A DCS was needed to overcome this problem and optimize the system configuration of a plant, depending on its size. By using microprocessors, Yokogawa solved a variety of technology issues and successfully developed the new DCS.

Because Yokogawa had already developed highly reliable technologies for duplicating control systems, it was able to develop the DCS ahead of its competitors. Unitization of a control system for optimal configuration, central monitoring and control with CRT displays, excellent system expandability, simple instrumentation setup, and integration with computers for production control–––all these capabilities led to the world’s first DCS.

Improving Financial StrengthIn those days, Yokogawa was slow to collect receivables and was shackled with excess inventory. Various efforts improved the collection of receivables, but reducing inventory required the restructuring of a system involving the manufacture of a wide variety of products in small quantities. Yokogawa decided to improve its information system first, and then its production lines.

In February 1975, Yokogawa installed the New Order Processing System (NOPS), and this was followed in December by the Production Information and Control System (PICS), which was suited to manufacturing a wide variety of products in small quantities. The two systems were then optimized to work together. Drawings, parts tables, and part numbers were systematized so that many manual operations could then be performed online dramatically improving speed and efficiency.

Yokogawa started overhauling production lines in 1978 and tested many things, including a just-in-time production system. In 1980, Yokogawa set a company-wide goal of halving production costs. In 1981, Yokogawa became a New Production System member and introduced the New Yokogawa Production System (NYPS) philosophy to reform all stages of work from designing to producing parts, assembling finished goods, and shipping, for total optimization. Operational efficiency was improved greatly.

The spread of NYPS was helped by the introduction of information processing systems: the COSMOS order processing system in 1982, the COSMOS–B (measurement) system in 1984, and the NYCE cost management system and the NICMOS procurement management system in 1985.

Merger with Hokushin Electric WorksIn the 1980s, Yokogawa was trying to enter new markets outside Japan because the market for plant construction in Japan was expected to become saturated soon. In addition, general electrical equipment manufacturers with superior semiconductor/computer technologies and stronger finances were beginning to enter the industrial instrument market. Yokogawa consequently decided to merge with Hokushin Electric Works, the third-largest company in the Japanese industrial instrument market.

Hokushin, which had been founded in 1919, had pioneered the production of industrial thermometers and process


Shozo Yokogawa

Released in 1975, the first CENTUM system

Car exhaust measuring instrument (CO/HC tester)

Ceremony to mark the shipment of the 1,000th CENTUM system

Yokogawa’s full-body CT scanner

Launch of NOPS

From Steady Growth to the Bubble Economy and Its Bursting (1975–1990)

Yokogawa Electric Singapore (founded in 1974)

μXL advertisement

YEWMAC

Digital oscilloscope

Analog LSI tester

YEWCOM9000

FA500

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control computers in Japan. At the time of the merger, the company, which had the top share in Japan in the differential pressure transmitter and electromagnetic flowmeter segments, enjoyed a high reputation for its technology and was one of the three dedicated industrial instrument companies in Japan, along with Yokogawa.

Both presidents decided on this merger based on mutual trust and a shared sense of crisis. They aimed to create the world’s top dedicated industrial instrument company, by pulling together capable employees from the two companies and by providing outstanding service to customers that only such specialist companies could provide, thus overtaking the competition.

On April 1, 1983, Yokogawa Hokushin Electric Corporation was established. Shozo Yokogawa became president, and Masahiro Shimizu (the former Hokushin president) vice president. The new company started with 5,800 employees and an annual sales target of 120 billion yen.

At the start, Shozo Yokogawa emphasized his management philosophy: “One for all, all for one.” He urged former Yokogawa and Hokushin employees to cooperate closely with each other in order to make the merger a success. As expected, harmonization was not easy at first. Even though the stock swap ratio for the merger had been calculated based on each company's assets and stock price, and was favorable to Yokogawa, management repeatedly made it clear through personnel policies and other measures that the two companies were equally balanced, both in terms of human resources and technology. As a result, the new company started to come together and its performance and market share began to rise.

Following the merger, the new company’s sales department opened its offices in the Shinjuku Center Building and the Shinjuku NS Building. New offices and factory buildings were constructed one after another at the headquarters. The Shimomaruko factory, where Hokushin used to be headquartered, was sold off in 1985 and thus the

Yokogawa released many products, such as the CENTUM V system, the YEWPACK–MARK II control system, the CENTUM–XL system, and the μXL distributed control system for small- and medium-sized plants. Covering plants of all sizes, the DCS business entered its prime years.

Yokogawa began to diversity its business in the 1970s. To meet the needs of customers in the electrical and electronics segment, which had come to the fore as a result of structural changes in Japanese industry in the 1980s, Yokogawa restructured its electronic measurement business and entered the semiconductor tester and digital oscilloscope markets. Yokogawa also utilized the development and sales personnel who had joined as a result of the merger in order to develop other system businesses outside the process automation (PA) field.

Firstly, targeting control and information systems for non-continuous processes, the factory automation (FA) business released many new products, covering areas ranging from the provision of products to system construction. These products included the YEWCOM super minicomputer, the YEWMAC manufacturing line control system, and programmable logic controllers. YEWMAC was used as a platform not only for FA but also for PA and building automation (BA).

Secondly, taking advantage of the boom in the construction of intelligent buildings in the late 1980s, Yokogawa entered the BA market, which involves the energy-efficient automatic control of equipment such as building air conditioners. Yokogawa also went into laboratory analysis, office automation (OA), and laboratory automation (LA). Throughout the 1980s, Yokogawa continued to enter new markets, although it would later withdraw from some of them.

Developing Non-Japan Markets with the Spirit of Mutual BenefitSince its foundation, Yokogawa has strived to grow its business in Japan and raise its profile outside Japan. In 1919, Yokogawa exported its instruments for the first time via a trading company, and in 1930, first exhibited its measuring instruments at an international exposition. In 1950, Yokogawa representatives resumed visiting other countries and this eventually resulted in a tie-up with Foxboro. In 1957, Yokogawa set up its first overseas office, in New York, and in 1958, exhibited its products at the ISA Show, a US trade fair focusing on instrumentation products and technologies. Moreover, Yokogawa entered the Chinese market, participating in exhibitions, exchanging technologies, and

relocation to the new company’s headquarters was completed.

In 1986, the company name was changed to Yokogawa Electric Corporation to strengthen the corporate identity. The YEW trademark was also changed to the current symbol and brand logo, which people worldwide found easier to understand and remember. In 1988, Yokogawa defined its corporate philosophy, marking the final step of the merger.

Yokogawa’s resources, including technologies, increased as a result of the merger. This advantage enabled Yokogawa to enter new fields, release many new products, and quickly set up several Group companies outside Japan.

Stronger Yen and Yokogawa’s DiversificationIn the early 1980s, high-performance yet low-price Japanese products flooded Western markets and led to trade friction. Japan came under pressure to take measures to make the yen stronger and increase domestic demand. Though it had suffered a high-yen recession in 1986, Japan’s economy once again started picking up at the end of the year.

After the merger, the control business grew steadily.


exporting products. As a result, Yokogawa came to be known widely.

In the 1960s, Yokogawa was exporting its measuring instruments to Western Europe through agents (direct export) and to Eastern Europe via trading companies (indirect export). In 1966, Yokogawa set up a representative office in Hamburg to boost sales.

In 1973, Yokogawa encountered a number of issues with Foxboro that led it to terminate that tie-up in 1975. Yokogawa took this crisis as an opportunity to strike out on its own and hurriedly built its own sales and service network.

Yokogawa established a sales and service office in Brazil in 1973; a manufacturing subsidiary in Singapore and a sales and service office in Europe in 1974; and a sales and service office in Singapore in 1975. In 1982, Yokogawa bought Electrofact, a Dutch analyzer manufacturer, and made it responsible for the sales network, technology development, manufacturing, and after-sales services across Europe.

Meanwhile, Yokogawa built a long and amicable relationship with China. Normalization of diplomatic relations between Japan and China in 1972 boosted its business there. In 1979, Yokogawa signed an agreement to transfer its industrial instrument technologies to a state-run company in Xian and this later led to the formation of a joint venture. In the 1980s, another technology transfer was agreed upon and a joint venture was set up in Chongqing.

When entering a new market, Yokogawa often introduced competitive products featuring its proprietary technologies. In the US, the ER recorder and the sulfur content meter were successful, and the sales of vortex flowmeters manufactured at a new factory in Georgia increased steadily. A pH meter developed jointly with a Group company in Europe was a global hit. Yokogawa gradually made its presence felt

After the signing ceremony, President Yokogawa (left) shaking hands with President Shimizu

The Yokogawa Hokushin Electric logo

The current symbol and brand logo

At this 1956 Yokogawa exhibit of automation solutions, a first for Japan, the company also featured Hokushin products

Formation of a joint venture in Xian, China

Yokogawa bought Electrofact, a Dutch company, in 1982

Yokogawa Corporation of America Yokogawa Keonics Yokogawa Electric Asia

The Hokushin logo

HOMAC series electronic control systemAutopilot system, a mainstay Hokushin product

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throughout the world.To make this dynamic strategy a success, detailed

guidelines needed to be shared among all employees. In October 1973, Yokogawa issued an in-house newsletter describing its policy for managing Group companies outside Japan and urged all employees to understand and follow it.

The policy emphasized the “spirit of mutual benefit,” under which Japanese employees helped other countries develop and share profits locally. Other major objectives were to train local employees and appoint them to managerial posts for true localization. This covered processes ranging from the machining of parts to their assembly and distribution worldwide in order to secure high quality and add high value. With the spirit of mutual benefit, Japanese employees both in and outside Japan overcame many hardships in developing business globally. As a result, Yokogawa earned the trust of local employees and customers and Group companies outside Japan came to operate autonomously.

In the late 1970s, Yokogawa entered the non-Japan control market by engaging in the high value-added DCS engineering business on a full-scale basis. However, to win customers’ trust in the control business, it was essential to hire capable local people who were responsible for all operations, from sales and engineering to after-sales services. In addition, it was necessary to establish a system to enable non-Japan Group companies to get support from Yokogawa Electric Corporation. This required a major investment and was a difficult hurdle to overcome.

Nevertheless, Yokogawa established its first non-Japan engineering subsidiary in Singapore in 1986, and then expanded in Southeast Asia and South Asia, followed by other areas.

In those days, Japanese engineering companies were entering overseas markets because the Japanese market was stagnant. By working with such companies, Yokogawa also expanded its own business overseas. Moreover, the merger with Hokushin provided many employees who were experienced in international business, while the appreciation of the yen made it easier for Yokogawa to expand abroad. Takashi Yamanaka, who became president of Yokogawa in 1988, also strived to expand outside Japan while strengthening sales organizations in Japan.

Japan had enjoyed a thriving economy since 1986, but in early 1990, stock prices began to plunge, followed by land prices, which then hit the real economy hard. The bursting of the bubble economy drove the Japanese economy into a long, dark tunnel that has been called the “two lost decades.”


Takashi Yamanaka

Hokushin Electric Works was established by Souhei Shimizu at Azabu, Tokyo in April 1919 to manufacture industrial meters. “Hokushin” is the Chinese name for the North Star, which has guided travelers since ancient times. Confucius said, “He who exercises government by means of his virtue may be compared to the North Star, which keeps its place and all the stars turn towards it.” Souhei Shimizu named his company after these words of wisdom, hoping that the company would become a leader of Japanese industry.

Hokushin started its business manufacturing thermometers. After moving its headquarters and factory to Shimomaruko, Tokyo, the company manufactured devices for marine vessels and aircraft. During World War II, the company produced 70% of all aircraft instruments for the Japanese army and navy and its compass was installed in most key warships. Hokushin thus became one of the major instrument makers in Japan.

However, it lost 85% of manufacturing facilities during air raids and military demand vanished when the war ended. Hokushin made a fresh start focusing on industrial meters, and then resumed manufacturing marine navigation and aircraft instruments. Through tie-ups with Western companies, Hokushin accumulated sophisticated technologies and gradually became competitive. The company made a success in the electronics field with the HOC series (Japan’s first calculator for the process industry) and Japan’s first direct digital control system. With products such as a large-bore electromagnetic flowmeter and various automation devices for marine vessels and aircraft, Hokushin became a well-known name in the industry. At the time of the merger with Yokogawa, Hokushin was the third-largest measurement and control company in Japan, after Yokogawa and Yamatake-Honeywell (currently, Azbil), with 2,200 employees and sales of 38.9 billion yen (in fiscal year 1981).

The sales breakdown was as follows.Industrial instruments: 74.6% (HOC series, 900/TX series microprocessor-based instrumentation system, HOMAC

and EK series electronic control system, recorders, transmitters, electromagnetic flowmeters, thermometers)

Aircraft instruments: 8.3% (air inlet controllers, flight directors)Marine navigation devices: 13.4% (satellite navigation systems, gyrocompasses, autopilot systems)Other: 3.7% (information systems)

The merger of Yokogawa and Hokushin created a major measarement and control company that was the world's third largest manufacturer of industrial instruments.

The History of Hokushin Electric Works

Column

DPharp differential pressure/pressure transmitter released in 1991

CSU10 confocal scanner unit

ETS was presented at Tokyo (photo) and other locations

The Fieldbus Foundation logo

CENTUM CS 1000

ProSafe-RSCeremony to mark the first shipment of DPharp

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In the late 1980s, there was an increasing need to integrate control systems for optimizing and streamlining all factory operations. In addition, customers wanted to integrate control systems with management systems, and consolidate the control rooms used for separate production facilities. Control systems were also required to support general-purpose technologies.

To satisfy customer’s needs for a sophisticated control platform that was both flexible and open, Yokogawa introduced the CENTUM CS integrated production control system in 1992. Its CPU relied on a pair & spare architecture that eventually enabled CENTUM series systems to achieve seven-9s (99.99999%) availability.

Meanwhile, since the mid-1980s, several suppliers had developed their own digital communication bus systems, which made it difficult to interconnect field devices. For the convenience of its customers, Yokogawa advocated the development of a new international fieldbus standard, and worked hard to make it happen. By leading the effort to develop consensus among multiple standardization bodies, Yokogawa played a key role in getting a new standard created in 2000.

Reforming the Control Business and ETSAs technologies were becoming increasingly open, Yokogawa noticed changes in the DCS market and started reforming its control business accordingly.

In July 1997, Yokogawa announced a new business concept, “Enterprise Technology Solutions (ETS).” With ETS, Yokogawa aimed to provide optimum, cutting-edge control technology solutions to address specific needs that its customers faced in their business operations. Thus, Yokogawa shifted its focus from the product business to the solution business.

As platforms to achieve ETS, Yokogawa released CENTUM CS 1000 for small- to medium-size processes in 1997 and CENTUM CS 3000 for large-size processes in 1998. These systems met customers’ expectations by having

“VECTOR 21” and Organizational ReformThe stock market plunge in January 1990 precipitated the collapse of Japan’s bubble economy and the start of the “two lost decades.” Customers simultaneously revised downward their capital investment plans and performance forecasts. In fiscal year 1991, Yokogawa managed to increase sales but operating income dropped significantly. Yokogawa announced the VECTOR1 21 corporate vision in 1992, aiming to become an industrial automation (IA) company in the years leading up to the 21st century by unifying process automation, factory automation, and laboratory automation, based on the company’s founding principles and corporate philosophy. This vision was intended to make employees aware of the drastic changes in the business environment and urge them to work together to overcome difficulties.

In July 1992, Yokogawa reorganized each business’s sales, development, and manufacturing divisions into strategic business units (SBU) in accordance with VECTOR 21. Responsibility and authority were delegated to the individual SBUs to enable them to respond appropriately and quickly to changes in the market environment. All organizations were divided clearly into cost centers and profit centers, and it was made clear that profit centers would be evaluated based on their profits. Thus, Yokogawa became profit-oriented.

However, both sales and profits in fiscal year 1992 fell far below the target. The decrease in sales and the increase in high-cost engineering were the reasons for this poor performance.

Eiji Mikawa, who became president in June 1993, focused on reducing the cost of existing products, accelerating the development of new products, improving sales efficiency, and streamlining headquarters functions. He allocated more human resources to the profitable semiconductor tester business, transformed the FA business into a solution business, and entered the information system business for non-manufacturing industries.

1 Standingforvalue,excellence,challenges,teamwork,open-mindedness,andresponsibility,thisalsoreferstoaforcethathasbothdirectionandmagnitude.

Developing Unique ProductsIn those days, Yokogawa developed many new products by using its unique technologies. The DPharp differential pressure/pressure transmitter released in 1991 sold strongly because of the high accuracy and reliability achieved by using the world’s first silicon resonant sensor. The confocal scanner released in 1996 was also highly acclaimed in the field of life science and adopted by research organizations in many countries. The technologies in these products won prestigious awards in Japan such as the National Commendation for Invention and the Okochi Memorial Technology Prize.

the same capabilities and open features of the latest general-purpose computers, and the capability to support fieldbuses, while maintaining the reliability of the DCS platform and backwards compatibility with previous CENTUM generations.

To expand the range of solutions, Yokogawa also jointly developed advanced control software packages with customers and engaged in M&A. In 1997, Yokogawa acquired GTI-IA, a Dutch company specializing in safety instrumented systems, and in 2005, released the ProSafe-RS safety instrumented system. In the analyzer business field, Yokogawa took a 51% stake in Measurementation, a leading analyzer systems integrator in the US (later integrated into Yokogawa’s US subsidiary).

To take the information business to the next level, Yokogawa acquired Marex Technology, a British company, to develop a common platform for manufacturing execution systems (MES) that manage and use data collected by DCSs. In 2000, Yokogawa added to its lineup the Exaquantum plant information management system, which uses Marex’s technology.

A New Long-term Corporate Strategy for Achieving a Profitable StructureIn 1998, Yokogawa’s sales and profit dropped sharply due to unprecedented negative economic growth in Japan and the Asian currency crisis. Amidst these difficulties, President Mikawa passed away in June 1999 and Isao Uchida, executive vice president, took over.


Eiji Mikawa

Overcoming the Post-bubble Recession and the Beginning of the Age of Globalization (1991–2010)

Spectrum analyzer, a major product of Ando Electric

President Uchida with Masao Motohashi (right), the then Ando president, announcing Yokogawa's acquisition of Ando's stock

Roll out of Vigilance campaign affirming the company's commitment to its control business

Announcing VigilantPlant, Yokogawa's vision for the ideal plantYokogawa won more orders for international large-scale projects as its business localized

Shuzo Kaihori

Kanazawa office

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In 2000, Yokogawa announced a new corporate strategy, VISION-21 & ACTION-21, to adjust to structural changes in the Japanese market and intensifying global competition. With this strategy, Yokogawa aimed to become a sound and profitable company and set profit targets for fiscal year 2005. The company also aimed to expand the measurement and information businesses, which, together with the control business, would serve as the three main pillars for Yokogawa.

In the measurement area, Yokogawa formed an alliance with Ando Electric in 2001 and then acquired all its stock in 2002. In 2004, the company integrated all of Ando's businesses. The measurement business, with optical measuring instruments and semiconductor testers, was reorganized into the communication and measuring instrument business and the advanced test equipment (ATE) business in 2003. Sales for the ATE business increased dramatically, making a great contribution to consolidated profits.

In the information field, Yokogawa worked on many new business projects through tie-ups with IT firms. The staff needed for these projects were secured by restructuring the control business. In addition, the company actively entered promising but challenging businesses.

Bursting of the Dotcom Bubble and Another Structural ReformIn 2001, the situation took a turn for the worse due to developments in the US such as the bursting of the dotcom

Transforming into a Global Company under the Vigilance CampaignWith a growing reputation and thanks to winning preferred supplier contracts, Yokogawa’s control business expanded steadily, and yet cases still occurred where Yokogawa was not included even in the first round of the tender process in Europe and North America because of its low profile. Recognizing the importance of branding in the control market, Yokogawa started its Vigilance campaign, which reflected its commitment to watching customers’ plants around the clock, throughout the year. This message was welcomed by our offices outside Japan as it reflected the value that they offer to customers, and it thus helped to unify all the Group companies. Gaining traction with our customers, this campaign entered a new stage in 2005 with the announcement of our VigilantPlant initiative for achieving the ideal plant. On the same day as that announcement, President Uchida revealed the goal of becoming the global No. 1 in the control business. This, combined with the release of the ProSafe-RS safety instrumented system, attracted much attention in the industry.

In the same year, Yokogawa set up Yokogawa Electric International in Singapore to manage all of the control business outside Japan. Response centers were also established in several countries to answer inquiries from customers 24/7 and vigilantly monitor their control systems. Through these efforts, non-Japan sales more than doubled in the five years starting in 2002, and Yokogawa gained recognition as a global player in the control market.

In 2008, Yokogawa announced CENTUM VP as a platform to support VigilantPlant. This integrated production control system provides an environment that effectively integrates the control and information systems at the production site, and is the ultimate form of Yokogawa’s production control system.

bubble and the terrorist attacks of September 11. Yokogawa made every effort to avoid losses, including slashing costs, reducing pay, and furloughing staff. In 2002-2004, 15 of the 19 production facilities in Japan were closed, and the global system for procurement, production, and logistics was revamped. Under this new system, as of November 2015 there are seven plants in five countries that produce a variety of products for the global market, seven plants in six countries that produce control and measurement products for the local market, and five plants in Japan that produce products for other businesses. The Group companies in Japan were also reduced and integrated.

At the same time, Yokogawa strengthened its financial position. For example, it sold off Hewlett-Packard Japan (the former Yokogawa-Hewlett-Packard) stock and converted the preferred stock of GE Yokogawa Medical Systems (former Yokogawa Medical Systems). Using part of these capital gains, Yokogawa eliminated a shortfall in the reserves for retirement pensions and compensated for an extraordinary loss associated with the reduction and integration of subsidiaries. Thus, Yokogawa quickly restored its financial health.

Making Engineering More CompetitiveThe number of Group companies outside Japan increased in the 1980s and Yokogawa products became better known for their excellent reliability. As a result, the number of orders for large projects was increasing outside Japan. However, Yokogawa’s engineering system could not effectively handle large projects in emerging and resource-rich countries. Although Yokogawa’s customer-centered and quality-first approach was highly valued, our offices in individual countries were not up to the challenge of implementing large-scale, long-term projects. Therefore, Yokogawa set up the Global Engineering Solution Center (GESC) in Singapore in 2001, to work with our engineering offices in India, China, and the Philippines. This system reduced costs and improved the quality of projects by sharing the expertise and know-how available at each of these locations.

In the early 2000s, Yokogawa won an order for China’s then-largest petrochemical complex project. This was the first project in which Yokogawa served as the main automation contractor (MAC). Many employees from different countries worked together to complete the project, which was highly praised by the customer. This was one of the achievements of the GESC.


The Second Milestone of the VISION-21 & ACTION-21 Plan and the Financial Crisis in 2008In 2006, Yokogawa identified areas for strategic investment and set numerical targets for fiscal year 2010 that would serve as the second milestone for VISION-21 & ACTION-21. The plan was to capitalize on the structural reforms that had been carried out in the years leading up to fiscal year 2005 by expanding new businesses in such fields as measuring instruments, life sciences, and photonics, and thereby achieve significant growth. Yokogawa established a life science facility in Kanazawa in 2005, and started manufacturing photonics products at the Sagamihara factory in 2007.

In April 2007, Shuzo Kaihori became president. That same year, DRAM prices suddenly plunged and customers cut back investments in semiconductors, putting Yokogawa’s measuring instruments and semiconductor tester businesses into the red. The profitability of the non-Japan control business also decreased, and demand in Japan contracted. With these unfavorable conditions, President Kaihori’s first year saw higher sales but lower profits.

At this point, Yokogawa judged that its business was at an inflection point, because its cost structure was making it difficult to remain price competitive, and the control business was shifting from products to solutions. Thus Yokogawa started improving its cost competitiveness and adding more value to engineering.

In fiscal year 2008, business conditions took a turn for the worse as a result of the global economic crises that followed events such as the collapse of Lehman Brothers, and the sudden shrinking of the semiconductor market. Yokogawa’s operating income was barely positive, and net income was heavily in the red due to a reversal of deferred tax assets.

Faced with these financial difficulties, Yokogawa designated the two years of fiscal years 2009–2010 as a period of structural reform in preparation for the next stage of growth, and started to reform its business structure and reduce fixed costs. Yokogawa decided to withdraw from the ATE, photonics, and advanced stage businesses as it had determined that it had over-estimated the growth potential of these markets, and due to the shrinking semiconductor tester market. The company also reviewed its business portfolio, downsizing the magnetoencephalograph business, transferring the measuring instrument business to Yokogawa Meters & Instruments, spinning off the medical information system business, and setting up Yokogawa Medical Solutions. Yokogawa was also forced to solicit applications for a voluntary retirement program.

Isao Uchida

Evacuation of company employees to the athletic field at the Tokyo headquarters following the Great East Japan earthquake

CENTUM VP R6 announced in 2014

President Nishijima briefing employees on Transformation 2017

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Announcing the Evolution 2015 Mid-term Business PlanIn 2011, several disasters and incidents struck the world economy, including the Great East Japan Earthquake, severe flooding in Thailand, and the debt crisis in Europe.

Amidst this turmoil, Yokogawa announced its mid-term business plan, Evolution 2015, in November 2011. This plan set business targets for fiscal year 2015 and specific strategies to achieve them, and aimed to transform Yokogawa into a global solutions and service company. This plan was the first step towards the goal of becoming the global No.1 in the control business.

The growth strategies for the control business were drawn up from three aspects: region, industry, and product. The regional strategy was to concentrate management resources on resource-rich and emerging countries. The industry strategy was to expand business in oil refining and petrochemicals, where Yokogawa already had a large share of the market while continuing to focus on the upstream (exploration and production) sectors of the oil and gas industries, and on electric power and specialty chemicals. The product strategy was to continue to develop highly reliable products that help customers address business issues, to capture the global top share with highly competitive products such as differential pressure/pressure transmitters, and to strengthen high value-added consulting services. Concurrently, Yokogawa built a production system suitable for global business, and globalized its headquarters functions.

In fiscal year 2014, the non-Japan control business accounted for 72 percent of all sales. To continue growing globally, Yokogawa will need to be able to compete with mega companies that are using their high profit, to aggressively invest in their businesses. Toward that end, Yokogawa will need to accelerate its growth strategy, strengthen cost competitiveness, and improve efficiency throughout the Group. As one such measure, the company radically reviewed existing functions and operations, and took the tough decision to rationalize human resources in Japan. In fiscal year 2014, Yokogawa solicited applications for voluntary retirement from employees of the three companies engaged in the control business in Japan (Yokogawa Electric, Yokogawa Solution Service, and Yokogawa Manufacturing).

Transformation 2017: the First Step towards the Next 100 YearsIn accordance with the Evolution 2015 mid-term business plan, Yokogawa worked hard to improve its profitability and finances by promoting growth strategies mainly in the control business, and it made progress in this latter respect thanks to the weak yen. Regarding profitability, in fiscal year 2014 Yokogawa was able to achieve the sales target for fiscal year 2015, one year ahead of schedule, and generated a record-high operating income. However, the increase in sales and operating income was largely due to the weaker yen, and the improvement in profitability was far from satisfactory. Meanwhile, as a result of a global restructuring of industries, Yokogawa’s business environment was changing and new opportunities were emerging.

Accordingly, Yokogawa had to rapidly transform its business structure, and so drew up a long-term business framework that defines what kind of company sought Yokogawa will need to be 10 years from now, and specifies strategies needed to achieve that goal. At the same time, without waiting for the completion of Evolution 2015, Yokogawa drew up a new mid-term business plan, Transformation 2017, (TF2017) that covers fiscal years 2015 to 2017.

In this plan’s long-term business framework, Yokogawa defined its vision statement, “Through ‘Process Co-

In December 2012, Yokogawa acquired a minority interest in Soteica Visual MESA LLC, a US firm with advanced energy management solutions (EMS), and began offering EMS services as part of its service solution lineup.

The control business did well with overseas projects, including a large LNG project in Australia and a second-phase project for a world-class oil refining and petrochemical plant in Saudi Arabia.

However, the control business in Japan faced challenging circumstances, and new investment in plants continued to shrink. Customers started to shift focus from installing new equipment to increasing the added value of their existing facilities, by means such as making more effective use of energy by improving production efficiency, reducing costs, and making operations safer. As a solutions and service company, Yokogawa responded by bringing the sales, engineering, and service functions of the Japan control business under the management of Yokogawa Solution Service, which was established for this purpose in April 2013. These three functions had formerly been handled by separate companies. In the same year, Yokogawa ushered in a new generation of leadership with the appointment of Takashi Nishijima as president.

Control Business Responds to Structural Changes in MarketBuoyed by energy-related demand in emerging and resource-rich countries, the non-Japan control business expanded, mainly in the oil, gas, and petrochemical industries. Starting in 2014, sales also were positively impacted by the weak yen. In line with this, orders for systems integration, advanced control, operation assistance, production management, security, and other types of solutions gradually increased. At the same time, Yokogawa focused on the development of new products to enhance its solution capabilities and sales.

In Japan, as manufacturers accelerated their efforts to restructure their businesses, Yokogawa strove to provide solutions that would make its customers' businesses more efficient, but they could not compensate for the decrease in the conventional control businesses.

Innovation,’ Yokogawa creates new value with our clients for a brighter future.” TF2017 is a three-year plan starting in fiscal year 2015. Over the next three years, Yokogawa will lay the foundation for the growth required to achieve the goals of the long-term business framework. The company also decided to focus on the following three priorities: customers, creating new value, and becoming a highly efficient global company.

Coincidentally, TF2017 was drawn up in 2015, which marks the 100th anniversary of Yokogawa. A century ago, Yokogawa started out with just four people. Currently, the Group operates globally, with 20,000 employees and offices around the world. The founding principles that have been passed down through the generations – quality first, pioneering spirit, and contribution to society – helped Yokogawa develop highly reliable and quality products that are the core of its business, excellent project execution capabilities, advanced knowledge in diverse industries and engineering capabilities, and meticulous local service. Yokogawa will never forget this. As a brave pioneer, we will anticipate changes, regard changes as opportunities, and act bravely, and will continue transforming ourselves in order to keep blazing new trails for another 100 years.


Takashi Nishijima

Aiming to Become the Global No.1 in the Control Business (2011–)

Data

1st-

2nd

1920

.12.

1-19

21.1

1.30

3rd-

4th

1921

.12.

1-19

22.1

1.30

5th-

6th

1922

.12.

1-19

23.1

1.30

7th-

8th

1923

.12.

1-19

24.1

1.30

9th-

10th

192

4.12

.1-1

925.

11.3

0

11th

-12t

h 19

25.1

2.1-

1926

.11.

30

13th

-14t

h 19

26.1

2.1-

1927

.11.

30

15th

-16t

h 19

27.1

2.1-

1928

.11.

30

17th

-18t

h 19

28.1

2.1-

1929

.11.

30

19th

-20t

h 19

29.1

2.1-

1930

.11.

30

21th

193

0.12

.1-1

931.

5.31

22th

193

1.6.

1-19

32.5

.31

23th

193

2.6.

1-19

33.5

.31

24th

193

3.6.

1-19

34.5

.31

25th

193

4.6.

1-19

35.5

.31

26th

193

5.6.

1-19

36.5

.31

27th

-28t

h 19

36.6

.1-1

937.

5.31

29th

-30t

h 19

37.6

.1-1

938.

5.31

31th

-32t

h 19

38.6

.1-1

939.

5.31

33th

-34t

h 19

39.6

.1-1

940.

5.31

35th

-36t

h 19

40.6

.1-1

941.

5.31

37th

-38t

h 19

41.6

.1-1

942.

5.31

39th

-40t

h 19

42.6

.1-1

943.

5.31

41th

-42t

h 19

43.6

.1-1

944.

5.31

43th

-44t

h 19

44.6

.1-1

945.

5.31

45th

194

5.6.

1-19

46.3

.31

46th

194

6.4.

1-19

46.8

.10

47th

194

6.8.

11-1

949.

9.30

48th

194

9.10

.1-1

950.

3.31

49th

-50t

h 19

50.4

.1-1

951.

3.31

51th

-52t

h 19

51.4

.1-1

952.

3.31

53th

-54t

h 19

52.4

.1-1

953.

3.31

55th

-56t

h 19

53.4

.1-1

954.

3.31

57th

-58t

h 19

54.4

.1-1

955.

3.31

59th

-60t

h 19

55.4

.1-1

956.

3.31

61th

-62t

h 19

56.4

.1-1

957.

3.31

63th

-64t

h 19

57.4

.1-1

958.

3.31

65th

-66t

h 19

58.4

.1-1

959.

3.31

67th

-68t

h 19

59.4

.1-1

960.

3.31

69th

-70t

h 19

60.4

.1-1

961.

3.31

71th

-72t

h 19

61.4

.1-1

962.

3.31

73th

-74t

h 19

62.4

.1-1

963.

3.31

75th

-76t

h 19

63.4

.1-1

964.

3.31

77th

-78t

h 19

64.4

.1-1

965.

3.31

79th

-80t

h 19

65.4

.1-1

966.

3.31

81th

-82t

h 19

66.4

.1-1

967.

3.31

83th

-84t

h 19

67.4

.1-1

968.

3.31

85th

-86t

h 19

68.4

.1-1

969.

3.31

87th

-88t

h 19

69.4

.1-1

970.

3.31

89th

-90t

h 19

70.4

.1-1

971.

3.31

91th

-92t

h 19

71.4

.1-1

972.

3.31

93th

-94t

h 19

72.4

.1-1

973.

3.31

95th

-96t

h 19

73.4

.1-1

974.

3.31

97th

-98t

h 19

74.4

.1-1

975.

3.31

99th

-100

th 1

975.

4.1-

1976

.3.3

1

101t

h 19

76.4

.1-1

977.

3.31

102t

h 19

77.4

.1-1

978.

3.31

103t

h 19

78.4

.1-1

979.

3.31

104t

h 19

79.4

.1-1

980.

3.31

105t

h 19

80.4

.1-1

981.

3.31

106t

h 19

81.4

.1-1

982.

3.31

107t

h 19

82.4

.1-1

983.

3.31

108t

h 19

83.4

.1-1

984.

3.31

109t

h 19

84.4

.1-1

985.

3.31

110t

h 19

85.4

.1-1

986.

3.31

111t

h 19

86.4

.1-1

987.

3.31

112t

h 19

87.4

.1-1

988.

3.31

113t

h 19

88.4

.1-1

989.

3.31

114t

h 19

89.4

.1-1

990.

3.31

115t

h 19

90.4

.1-1

991.

3.31

116t

h 19

91.4

.1-1

992.

3.31

117t

h 19

92.4

.1-1

993.

3.31

118t

h 19

93.4

.1-1

994.

3.31

119t

h 19

94.4

.1-1

995.

3.31

120t

h 19

95.4

.1-1

996.

3.31

121t

h 19

96.4

.1-1

997.

3.31

122t

h 19

97.4

.1-1

998.

3.31

123t

h 19

98.4

.1-1

999.

3.31

124t

h 19

99.4

.1-2

000.

3.31

125t

h 20

00.4

.1-2

001.

3.31

126t

h 20

01.4

.1-2

002.

3.31

127t

h 20

02.4

.1-2

003.

3.31

128t

h 20

03.4

.1-2

004.

3.31

129t

h 20

04.4

.1-2

005.

3.31

130t

h 20

05.4

.1-2

006.

3.31

131t

h 20

06.4

.1-2

007.

3.31

132t

h 20

07.4

.1-2

008.

3.31

133t

h 20

08.4

.1-2

009.

3.31

134t

h 20

09.4

.1-2

010.

3.31

135t

h 20

10.4

.1-2

011.

3.31

136t

h 20

11.4

.1-2

012.

3.31

137t

h 20

12.4

.1-2

013.

3.31

138t

h 20

13.4

.1-2

014.

3.31

139t

h 20

14.4

.1-2

015.

3.31

40

30

20

10

0

(10)

(20)

450

375

300

225

150

75

0

Sales Sales (consolidated) Operating income Operating income (consolidated)

Sales (Billion yen) Operating income (Billion yen)

Financial period

90

80

70

60

50

40

30

20

10

0

4.5

4.0

3.5

3.0

2.5

2.0

1.5

1.0

5

0

Financial Periods 1~44Sales (Million yen) Operating income (Million yen)

43th-

44th

41th-

42th

39th-

40th

37th-

38th

35th-

36th

33th-

34th

31th-

32th

29th-

30th

27th-

28th

26th

25th

24th

23th

22th

21th

19th-

20th

17th-

18th

15th-

16th

13th-

14th

11th-

12th

9th-1

0th

7th-8th

5th-6th

3rd-4th

1st-2nd

Trend of sales and operating income

56 57

Data

Group companiesTrend of sales outside Japan

Sales by business segment Worldwide employees

Industrial automation and control

Test and measurement

Other

Sale for FY2014

4,058 billion yen

88.2%

5.9%5.9%

Yokogawa Electric Cprporation

Group companies in Japan

Group compnaies outside Japan

2,871

11,590

World wide

19,601as of March31,2015

5,140

350

300

250

200

150

100

50

0

70

60

50

40

30

20

10

0

1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 (Fiscal year)1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

(%)

Sales outside Japan Sales ratio outside Japan

(Billion yen)

58 59

North AmericaUnited StatesYokogawa Corporation of AmericaYokogawa USA, Inc.Yokogawa Nuclear Solutions, LLCSoteica Visual Mesa, LLC

CanadaYokogawa Canada, Inc.

MexicoYokogawa de Mexico, S.A. de C.V.Yokogawa Engineering Services de Mexico, S.A. de C.V.

South AmericaBrazilYokogawa America do Sul Ltda.Yokogawa Service Ltda.

ColumbiaYokogawa Colombia S.A.S.

EuropeNetherlandsYokogawa Europe B.V.Yokogawa Europe Solutions B.V.Yokogawa Europe Branches B.V.Yokogawa Process Analyzers Europe B.V.Yokogawa Africa Holding B.V.

AustriaYokogawa GesmbH, Central East Europe

BelgiumYokogawa Belgium N.V./S.A.

FranceYokogawa France S.A.S.

GermanyYokogawa Deutschland GmbHRota Yokogawa GmbH & Co. KG

HungaryYokogawa Hungaria Kft.

ItalyYokogawa Italia S.r.l.

PolandYokogawa Polska Sp. z o.o.

SpainYokogawa Iberia S.A.

United KingdomYokogawa United Kingdom LimitedYokogawa Marex Limited

CISRussiaYokogawa Electric CIS Ltd.Yokogawa Electric Sakhalin Ltd.

KazakhstanYokogawa Electric Kazakhstan Ltd.

UkraineYokogawa Electric Ukraine Ltd.

Middle EastBahrainYokogawa Middle East & Africa B.S.C. (c)Yokogawa Engineering Bahrain SPC

Saudi ArabiaYokogawa Saudi Arabia Ltd.Yokogawa Services Saudi Arabia Ltd.

United Arab EmiratesYokogawa Engineering Middle East & Africa FZE

AfricaSouth AfricaYokogawa South Africa (Pty) Ltd.Yokogawa Anglophone Africa Regions (Pty) Ltd.

NigeriaYokogawa Services Solutions Nigeria Ltd.Yokogawa Nigeria Ltd.

OceaniaAustraliaYokogawa Australia Pty. Ltd.

New ZealandYokogawa New Zealand Ltd.

AsiaSingaporeYokogawa Electric International Pte. Ltd.Yokogawa Engineering Asia Pte. Ltd.Yokogawa Electric Asia Pte. Ltd.Plant Electrical Instrumentation Pte. Ltd.

IndonesiaP.T. Yokogawa IndonesiaP.T. Yokogawa Manufacturing Batam

MalaysiaYokogawa Electric (Malaysia) Sdn. Bhd.Yokogawa Kontrol (Malaysia) Sdn. Bhd.Yokogawa Industrial Safety Systems Sdn. Bhd.Yokogawa Analytical Solutions Sdn. Bhd.

PhilippinesYokogawa Philippines Inc.

ThailandYokogawa (Thailand) Ltd.

VietnamYokogawa Vietnam Company Ltd.

IndiaYokogawa India Ltd.Yokogawa IA Technologies India Private Limited

ChinaYokogawa China Investment Co., Ltd.Yokogawa China Co., Ltd.Yokogawa Electric China Co., Ltd.Yokogawa Sichuan Instrument Co., Ltd.Suzhou Yokogawa Meter CompanyYokogawa Shanghai Instrumentation Co., Ltd.Yokogawa Shanghai Trading Co., Ltd.Yokogawa Process Control (Shanghai) Co., Ltd.Yokogawa Information Systems (Dalian) CorporationYokogawa Software Engineering (WUXI) Co., Ltd.Yokogawa System Integration & Procurement (WUXI) Co., Ltd.

KoreaYokogawa Electric Korea Co., Ltd.Yokogawa Electronics Manufacturing Korea Co., Ltd.

TaiwanYokogawa Taiwan Corp.

Group companies in JapanYokogawa Solution Service CorporationYokogawa Meters & Instruments CorporationOmega Simulation Co., Ltd.YDC CorporationYokogawa & Co., Ltd.Yokogawa Denshikiki Co., Ltd.Yokogawa Foundry CorporationYokogawa Manufacturing CorporationYokogawa Medical Solutions CorporationYokogawa Pionics Co., Ltd.Yokogawa Rental & Lease Corporation

As of March 31, 2015

Always Reaching Higher—Yokogawa centennial booklet—

Yokogawa Electric CorporationPublished in November 2015©2015 Yokogawa Electric Corporation

Documents

Always Reaching Higher - Yokogawa