Always Reaching Higher —Yokogawa centennial booklet—

Yokogawa Electric Corporation Published in November 2015 ©2015 Yokogawa Electric Corporation 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 Taking the opportunity presented by this centennial anniversary, Yokogawa from measurement to control and information solutions, and provided essential has established the corporate brand slogan of “Co-innovating tomorrow.” This core technologies that helped to spur industrial growth. clearly expresses the intent of the vision statement in the long-term business At the time of the company’s founding, Dr. Yokogawa explained his business framework that was announced in May: “Through ‘Process Co-Innovation,’ philosophy to Ichiro Yokogawa, who later would become the company’s first Yokogawa creates new value with our clients for a brighter future.” This has the president, and Shin Aoki, the eventual first chief engineer. Passed down over added purpose of encouraging all Group employees to work together. Under the years to the present day, these founding principles emphasize putting this new slogan, Yokogawa will seek to build even stronger bonds of trust with quality first, having a pioneering spirit, and contribution to society. Based on its customers by working with them to create value and stimulate growth. these principles, Yokogawa has built trust not only with its customers, but also I want to make Yokogawa an ideal company in which all employees can say the broader society, and has gone on to develop new technologies and become with confidence, “Our dream is to make customers’ dreams come true,” and I a global enterprise. Our commitment to these principles is firm and unchanging. ask everyone in the Group to be aware of Yokogawa’s history and values, and Our business environment is changing dramatically as a result of globalization to work together to make our next 100 years even better. 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.

Takashi Nishijima President and Chief Executive Officer

2 3 Quality first The Yokogawa Philosophy As 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.

In his instructions to Ichiro Yokogawa and Shin Aoki, Dr. Tamisuke Yokogawa said, The Yokogawa Heritage “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. The concepts and values that underlie everything we do at Yokogawa Although first set into words in 1988, the Yokogawa Philosophy is based on these did not come about in just one day. Amidst social change and 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 the growth in our business that has transpired over the past 100 years, objectives. we have remained faithful to this cherished heritage. Core Values Respect Value creation Collaboration Integrity Gratitude

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.

Pioneering spirit

Contribution to society

4 5 Our Next 100 Years—

Vision Statement

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

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.

Corporate Brand Slogan

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.

7 Contents Yokogawa’s Our Past 100 Years ……… History Message from the President 2~3 Chapter 1 From the Founding to Postwar Reconstruction (1915-1947) ……… 36~39 The Yokogawa Heritage ……… 4~5 The Electric Meter Research Institute and Tamisuke Yokogawa ∕ Becoming the Top Electric Meter Maker in Japan ∕ Oscillograph: an Early Main Product of Yokogawa ∕ Our Next 100 years ……… 6~7 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

Yokogawa’s Globally Recognized Technology and Quality Chapter 2 Strengths High Precision and Long-term Stability — Keys to Winning Our Customers’ Trust From Postwar Recovery to Rapid Economic Growth and Oil Crisis (1948-1974) ……… 12~15 ……… 40~43

Contributing to the Development of Modern Science and Engineering ∕ Scaling From Reconstruction to Recovery ∕ An Overseas Visit and the Decision to Develop ER the Heights of the Measurement Field ∕ A Theory- and Principle-based Approach to Instruments ∕ Tie-ups with Two US Companies ∕ Rapid Economic Growth Era in Japan ∕ Measurement ∕ The Value of Non-stop Performance ∕ High-quality Products at a Intensified Competition ∕ Setting Up of Yokogawa-Hewlett-Packard ∕ End of the Rapid Reasonable Price — Improved Production Technology Economic Growth Era

Professional and Honest: the Yokogawa Approach to Delivering Solutions, from Chapter 3 Solution Proposal to Project Execution ……… 16~19 From Steady Growth to the Bubble Economy and Its Bursting (1975-1990) ……… 44~48 Yokogawa’s People Keep Their Promises — Yokogawa’s People Honor Their Commitments ∕ Our Customer Approach ∕ Challenges Keep Coming Even After a Project Overcoming Difficulties ∕ CENTUM: the World’s First DCS ∕ Entering the Medical Order Is Booked ∕ Comprehensive Solutions Backed by a Wealth of Expertise in Equipment Market ∕ Improving Financial Strength ∕ Merger with Hokushin Electric Works ∕ Production Operations ∕ Looking beyond Our Role as a Main Automation Contractor (MAC) Stronger Yen and Yokogawa’s Diversification ∕ Development Non-Japan Markets with the Spirit of Mutual Benefit

High Quality Solutions for Global Customers — the International Development of Column ……… Yokogawa 20~23 The History of Hokushin Electric Works ……… 49

Transitioning from Indirect Exports to Direct Sales ∕ Business Expansion Targeting the Global Market ∕ Aiming to Be the Global No.1 in the Control Business Chapter 4 Overcoming the Post-bubble Recession and the Beginning of the Age of Globalization (1991-2010) ……… 50~53 Excellent Execution of Megaprojects, as Demonstrated in the Petro Rabigh Project ……… 24~27 “VECTOR 21” and Organizational Reform ∕ Developing Unique Products ∕ Reforming the Control Business and ETS ∕ A New Long-term Corporate Strategy for Doing What’s Best for the Customer ∕ Yokogawa Selected as MAC for Global Megaproject ∕ Achieving a Profitable Structure ∕ Bursting of the Dotcom Bubble and Another Structural Think Ahead, Be Prepared ∕ Petro Rabigh II — The Challenge of Providing Local Content ∕ Reform ∕ Making Engineering More Competitive ∕ Transforming into a Global Company Advancing Together through the Development of Saudi Human Resources under the Vigilance Campaign ∕ The Second Milestone of the VISION-21 & ACTION-21 Plan and the Financial Crisis in 2008 CSR Initiatives Contributing to Society, People, and the Earth ……… 28~29 Chapter 5 The Relationship between Business and Society ∕ Good Citizenship Aiming to Become Global No.1 in the Control Business (2011-) ……… 54~55 Contributing to Society through Our Business ∕ Being a Good Neighbor 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 For Yokogawa around the Globe ……… 30~33 Years

8 9 Data Trend of sales and operating income Trend of sales outside Japan Sales by segment Group employees Group companies

Yokogawa’s Strengths Globally recognized technology and quality

10 11 Yokogawa 100th Anniversary Yokogawa’s Strengths Globally Recognized Technology and Quality accuracy of ±0.02%, which is the same level of precision as the Japan national standard. To stay accurate, measuring High Precision and Long-term instruments must be calibrated; the equipment used to calibrate these instruments must also be calibrated, Stability—Keys to Winning Our and that equipment must be calibrated as well... And so the cycle goes on. The national standard brings this cycle to a Customers’ Trust 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, CSU-W1 confocal scanner unit. This product series won and is once more in the limelight due the Okochi Memorial Technology Prize to the current demand for further N-3 electromagnetic oscillograph. Oscillographs were improvements in energy efficiency. long a good source of profits for the company and reducing the effects of temperature A Theory- and Principle-based changes and other environmental factors. This has been done by fabricating the 1 Dr. Yasujiro Niwa was the first person in Japan Approach to Measurement engineers who had been entrusted with role in supporting research activities at to successfully carry out experiments with sensor from a single silicon crystal and Contributing to the Development the launch of the company: “You don’t research institutions and universities wireless telephotographic transmission, the first The unrivaled precision of Yokogawa’s positioning it inside a vacuum chamber. president of Tokyo Denki University, and a of Modern Science and need to worry about profits. Just learn throughout Japan. recipient of the Order of Cultural Merits. Around instruments has its origins in our By eliminating the need for periodic Engineering and improve our technology. You must 1918 – 1919, at the telecommunications emphasis on getting back to the zero adjustments and the use of valves make products that earn us the respect ministry, he suggested that Shin Aoki manufacture British-style measuring equipment basics with a theory- and principle- in this procedure, and by lengthening Throughout our 100-year history, from of our customers.” He said this not only Scaling the Heights of the in Japan, and later summed up his actions by based approach to measurement, the calibration interval, we have made it one generation of employees to the next, because they were starting from zero and writing, “In those days it was thought that the Measurement Field Japanese could never make such precision as it is applied in research and possible for our customers to dramatically Yokogawa’s people have been steadfast were trying to catch up with Europe and instruments, and demand for Japanese development. Measurement of a reduce their maintenance costs. And with and resolute in their purpose. This is why the U.S., but also because his intention This steadfastness has been evident in instruments was low. But Mr. Aoki accepted the challenge, and we were greatly pleased physical substance, energy, and so on a single DPharp transmitter, users can Yokogawa is at the top of the control was to first become a trusted source our pursuit to improve the accuracy of when, after one year of intensive research, he requires the manipulation of a target perform multiple types of measurements, field in Japan, and ranks alongside of the technology that provides the our power analyzers, which we have been succeeded in building a meter that outperformed Western products.” object and the capturing of data on eliminating the need for multiple global competitors who do business on foundation for research and development selling since the company was founded its response. The first consideration in transmitter types. All this is made possible a scale that is several times or even tens and manufacturing. Yokogawa has and which continue to be a key product this is how to get the most accurate by micro electro mechanical systems of times larger. This firm resolution is the faithfully achieved these aims. for Yokogawa today. For readings to be and detailed measurement of a target (MEMS) technology, which is another source of our strength, and it continues In 1924, the company’s 10th year trustworthy and usable, measurement object. Yokogawa has wholly focused major weapon in Yokogawa’s armory. to make our position secure. in business, we developed a portable must be highly precise. Yokogawa has its efforts on this in its development A winner of the Okochi Memorial One of the foundations for this oscillograph, Japan’s first. At an poured its heart and soul into this obvious and production of devices used Technology Prize, our confocal scanner inheritance that provides a basis for the international exposition that was held fact. As the company was established not to measure items such as power, unit product has successfully resolved measurement and control engineering in May 1930 in Liege and Antwerp, long after electrification had commenced pressure, temperature, and flow rate. the issue of how to continuously capture underlying our production systems is Belgium, we exhibited an oscillograph, in Japan, our first meters were mainly We never take our eyes off what is being images of live cells in real time at our sense of duty and the responsibility electric meter, and other instruments, modeled after products that were being measured, and our strengths lie not speeds approaching a thousand times that we feel for the activities that we and received an honorary award. made outside Japan. But our products only in efficient digital processing and per second. This relies both on optical undertake as a business. Societies have Yokogawa’s oscillographs were soon were the equivalent of anything the analysis of measurement signals measurement technology, a Yokogawa 1 flourished through the production and continually refined over the next 30 produced elsewhere. And by the 1960s, and data, but also in the fundamental strength, and mechatronics technology. use of energy and goods, and modern plus years, and went on to play a key a half century ago, we were targeting an technologies that rely on analog The high imaging speed is accomplished science and production systems have elements to capture signals and data. through the use of a laser beam that dramatically accelerated this. The DPharp, a pioneering differential pressure/pressure transmitter Our pioneering DPharp differential passes through a microlens attached basis for all these activities has been pressure/pressure transmitter was to a disk with up to 20,000 pinholes to detailed observation and the analysis of developed based on just such a theory- illuminate a specimen. This enables the data derived from these observations. and principle-based approach. The dynamic movements of living cells and Mass production, automation, and application of pressure on H shaped their organelle to be captured, making mechanization have all been brought resonators thinner than a human hair a great contribution in a wide range of about through processes such as stretched out inside a tiny package fields, from basic biology through to quantification, the accumulation of causes a change in resonance that the development of new drugs. Our knowledge, and the analysis of data is converted to an electric signal and development of other products such as that all draw on the five senses and the digitized. The maximum possible vortex flowmeters has also been based human capacity for reason. repeatability and stability (fluctuation on such basic theories and principles. One hundred years ago, company of ±0.02% over a 15 year period) have Through our rigorous approach to The global top-selling WT3000E precision power analyzer founder Tamisuke Yokogawa had the Cross section of a silicon been achieved by increasing sensitivity research and development and our following message for the two young resonant sensor 12 13 Yokogawa’s Strengths Globally Recognized Technology and Quality Yokogawa 100th Anniversary

in mass production and has sales production technology, and the provision systems in place to handle unit totals of support to these facilities outside ranging from the hundreds of thousands Japan. By such means, the NYPS to the millions, Yokogawa’s methods model has stayed true to our emphasis varied by individual product. For this on considering human needs and has reason, there was strong opposition strengthened manufacturing by better to NPS at various work sites, but it motivating individuals and making was seen as a major step needed for greater use of their abilities. employees to begin the transition from The technological capabilities and long-held concepts and approaches. the product strengths that Yokogawa Later, Yokogawa introduced its has cultivated since its founding are own New Yokogawa Production the driving force behind our efforts System (NYPS). While staying true to develop solutions. Our research, to basic NPS concepts on human development, and production of needs and the elimination of waste, reasonably-priced products and systems this proprietary NYPS model sought with the functions and quality required to standardize production volumes by in this era of globalization sets us apart strictly managing order information. from our competitors. Now more than Furthermore, it refined the mixed ever, Yokogawa is taking the high road production method by integrating the in manufacturing. 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.

CENTUM: Non-stop performance that always adds value Following this change in approach, steady improvements were made that, for example, substantially reduced lead collaboration with our customers, instruments are subject to vibrations. Yokogawa has achieved 99.99999% the aim has been to prioritize human times for products that traditionally had including major global companies, In other words, they must be both availability ([1-duration of breakdown/ needs by, for example, designing the been held to have a six-month lead time. we have succeeded in producing incredibly sensitive and tough. DPharp duration of operation] x 100). interface so that it has the same intuitive In addition, production facilities were and refining technologies that other transmitters accomplish this by having Yokogawa has quickly sought to ease of use as an analog meter. And expanded outside Japan with the aim companies cannot easily imitate. silicon resonant sensors that are develop standards based on these even in cases where it would be easier of improving production efficiency and vacuum-enclosed and highly stable. technologies. The company has actively from a cost, performance, or efficiency allowing the modification of products to These factors are even more important engaged in developing new and highly perspective to completely change the suit local market needs. There are now The Value of Non-stop for the CENTUM integrated production reliable communications technologies control system, we have always put 19 production facilities outside Japan. Performance control system, Yokogawa’s flagship such as FOUNDATION™ fieldbus and the priority on maintaining backwards Most of these are in Asia, and a few are product. The CENTUM control system ISA100 Wireless, and has sought to compatibility when seeking to strengthen located in Europe and the Americas. Other technical advantages of all connects countless sensors that are promote the development of related functionality. This is one of the reasons The role of the head factory in Kofu has Yokogawa measurement and control located throughout a plant, using the international standards and improve why CENTUM is so highly regarded. gradually changed to the production products that have earned us worldwide data obtained to automatically control compatibility between production of core products, the development of recognition are long-term stability, high the plant’s operations. It is absolutely control systems and the enterprise reliability, and environmental resistance. essential for a system like CENTUM to resource planning (ERP) and other types High-quality Products at a While our custmers expect our sensors remain operational at all times. Since of systems that act as the brain for Reasonable Price—Improved and control systems to be highly releasing CENTUM in 1975, we have businesses. Production Technology accurate, they must also be capable continually upgraded its capabilities Speaking of stability, another of of operating without interruption in by, for example, introducing the use Yokogawa’s strengths is product In order to offer products and systems challenging environments, such as an of dual redundant processor and continuity. Since the 1990s, there that achieve high levels of precision outdoors location where temperatures main memory modules. CENTUM have been numerous mergers and and stability, Yokogawa is continually vary considerably or in a factory where CS, released in 1992, features a pair acquisitions of companies in the seeking to optimize operations at its of micro-processor units measurement and control field. Leading plants, which produce a great variety (MPUs) in each processor global companies have been particularly of products in small lots. Until the module that perform active on this front, expanding and 1970s, Yokogawa followed a typical the same computations strengthening their businesses by plan-based production model and and continuously check purchasing other market players. kept large inventories of parts and for transient errors. For Numerous changes to software and finished products. However, as a advanced stability, it other kinds of products have been made result of the saturation of the domestic employs Pair & Spare, as a result, and this has led to difficulties market, increased overseas expansion, a superb method that for users in obtaining necessary parts increased competition, and other achieves high reliability by for the upgrade or repair of equipment. factors, Yokogawa decided to reduce automatically switching In contrast, Yokogawa has always its production costs by introducing the control to a standby sought when offering new measurement New Production System (NPS) in 1981. processor module in the and control products and systems to Based on the Toyota production system, event of a system failure. maintain backwards compatibility with this was an order-based production 1975 release of CENTUM, the world’s first distributed control system Through such advances, existing products. Also with CENTUM, model. Unlike Toyota, which is engaged Production lines at Yokogawa Manufacturing’s Kofu factory 14 15 Yokogawa 100th Anniversary Yokogawa’s Strengths Globally Recognized Technology and Quality with customers and other companies such as equipment suppliers that is altogether different from the type of communication required to simply Networks, sell systems or individual pieces of infrastructure equipment. Whatever the difficulties that we face, we must honor our Enterprise resource planning Professional and Honest: Business

commitments and, without fear of failure, Business planning, continuity follow projects through to completion. treasury management, planning logistics the Yokogawa Approach to This may initially appear quite simple Environment and resource improvement and straightforward to some, but it is not Operation management Environmental protection, Data mining necessarily so. Mr. Lam stated that, from Production resource management, energy management the customer’s perspective, Yokogawa inventory control, logistics, Delivering Solutions, from quality control, traceability, is in these respects an outstanding operation improvement Risk and company. It was, therefore, only natural safety management

that the system engineers and project Advanced operation assistance Information security, Big data Solution Proposal to Project invasion monitoring, leaders who face such challenges were safety instrumented systems delighted with his words. Facility management Process control Data on operations, quality, Yokogawa’s transformation into a Condition management, Continuous, batch, device management, etc. Execution solutions provider was initiated with the discreet maintenance management, introduction of ETS, and this continued diagnosis with the launch of VigilantPlant. We are, indeed, in the process of further evolving Field networks, our business, aiming in Japan to become field wireless products a solutions provider that offers a high- Field instruments added value business consulting service Sensors, actuators, for companies engaged in businesses analyzers, drives other than manufacturing. Namely, we will analyze problems and then suggest Yokogawa’s People Keep Their and execute solutions for the operation Promises—Yokogawa’s People of factories and other facilities in which Comprehensive consulting services offered by Yokogawa Solution Service covering everything from field instrumentation to enterprise resource planning Honor Their Commitments control systems will play an essential role. We will continue to evaluate the Staying on schedule and on budget results of these solutions and use demonstrate their strengths. As will while catering to the needs of a the insights gained to suggest further Our Customer Approach be discussed in greater detail later customer is a basic for any business, improvements. on, project leaders have every type but it is not always easy. With longer- In the global market, we will continue Our value-added solutions will vary of standard manual and a full range term projects where there is more that to pursue growth as a provider of total depending on whether they are for a of Yokogawa package solutions and can go wrong, Yokogawa’s people do instrumentation solutions, primarily new or existing facility. In either case, products at their disposal, and are everything in their power to stay on time in the capacity of a main automation however, it will be important for us to called on to oversee and motivate and on budget. contractor (MAC). evaluate the current situation and identify large numbers of personnel, engage in In October 2005, Yokogawa hosted a issues that will need to be addressed. demanding negotiations with customers symposium and technology innovation With an existing facility, we will and partners, and create solutions. And fair to celebrate its 90th anniversary. start by either responding to already even after submitting their proposals for The company invited Simon Lam, an identified problems and needs or by large-scale projects, they must respond executive of the oil & gas supermajor conducting a survey to identify such in a very timely fashion to countless Royal Dutch Shell and the CEO of problems and needs. These needs inquiries from their customers. CNOOC and Shell Petrochemicals could include the desire to enhance It is here also that Yokogawa’s resolve Company Ltd., as a guest speaker. In capabilities without upgrading to keep its promises shines through. his appraisal of our company, Mr. Lam equipment, improve production and For plant upgrade projects in Japan, noted three key characteristics: reduce the size of the workforce, we have professionals covering each • We keep our promises. Overview of the ETS business, our first step in becoming a solutions provider integrate and visualize information in industry who are intimately familiar with • We don’t turn our backs on coordination with central control and every detail at our customer sites and difficulties, but confront them head upper-level management information who work tenaciously together with the on and see our work through to Enterprise Technology Solutions (ETS) of such facilities – including even the systems, improve security and safety, customer to identify problems and come completion. concept and stated its intention to seek business management level – over the reduce energy consumption, outsource up with solutions. And with large-scale • We provide high-quality and reliable growth by providing solutions in the entire plant lifecycle. maintenance services, or support a projects outside Japan where deadlines solutions based on the latest Japan industrial automation and control Furthermore, in the global industrial business operation in another country. are extremely tight, our employees work technologies. market, which had by then reached automation and control market, we With a new facility, we seek when around the clock, if need be, to draw up While Mr. Lam addressed his words to maturity and offered few prospects for understood that the ability to provide preparing our proposal to meet the and submit proposals on time. the entire company, they resonated most new projects. The company aimed to solutions from a business management customer’s cost and delivery schedule What motivates Yokogawa’s people deeply with the sales engineers and become a solutions provider that not perspective would become necessary requirements while providing a solution to work in this way? The answer to this project leaders who have direct contact only utilizes cutting-edge equipment as large-scale projects entered the that both adds value and performs the question varies depending on which with our customers, and made them and systems to optimize control planning phase. Our VigilantPlant concept for realizing the ideal requested functions. systems engineer or project leader plant by achieving excellence in four areas want to say, “That is exactly how I feel.” systems at the factory level, but also This type of solutions business Here, our global network of project you ask. One replied that it was only In 1997, Yokogawa introduced its optimizes all aspects of the operation requires high-level communication leaders and system engineers natural to want to meet the needs of

16 17 Yokogawa’s Strengths Globally Recognized Technology and Quality Yokogawa 100th Anniversary

Evolution of Business Models

Innovate by identifying needs that customers Advanced are not aware of and presenting solutions. (Fulill dreams)

Provide optimized solutions that Applied meet specific customer needs. (Create solutions)

Supply superior products that Foundation meet basic customer need. (Sell things)

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

need to address. Our implementation of solutions draws on field sensors of Looking beyond Our Role as a every type, and Yokogawa’s flagship Main Automation Contractor product, the CENTUM control system. (MAC) We are able to deploy personnel who are specialized in control technologies A little over 20 years have passed since and in the manufacturing execution Yokogawa’s solutions business began systems (MES) that link production to flourish. With a corporate history that Global response centers that provide an extensive range of after-sales support services. Ready at all times to respond to customer requests operations with the management layer, stretches back 100 years, this might well and provide consulting services for the be considered a recent development. An post implementation phase. effort is now underway to take this to the To provide enhanced support next level. services to our customers, we position As a MAC, Yokogawa plays a central customers who have placed their trust solution teams confront them head just one example, at a worksite where scheduling reasons. Our first priority is solution service centers near their project role, with overall responsibility in Yokogawa and come to depend on on. If management and personnel at productivity had not improved for over to deliver a plant solution that fully meets sites. We are one of exceptionally for measurement and control solutions. us. Another answered that our honest the worksite don’t see eye to eye, we 10 years we analyzed data to identify a customer’s needs. Once a facility is few companies with the wide range Not limiting ourselves to project and sincere approach gave us a leg up analyze the data gathered by CENTUM problems and proposed solutions that fully operational, we expect that our of expertise in production operations implementation, we will focus on in the competition with companies that and other systems, draw up proposals ended up reducing costs by hundreds customer will recognize the value of needed to develop and offer rich and providing support over the entire are both bigger and more experienced based on concrete figures, and work to of millions of yen. Such cases are what Yokogawa has provided, and only versatile manufacturing execution lifecycle of a production facility, toward in carrying out projects outside Japan. bring both sides to an agreement. What commonplace here at Yokogawa, thanks then do we ask for payment in full. and management package solutions. which end we will be engaged during Where they all agree is that, no matter makes the difference is our wide ranging to outstanding employees with long This is made possible by having the Indeed, this is one of the main reasons the design and construction phases how difficult the challenge, all of us measurement and control experience track records of success. necessary systems and structures in why many major IT vendors and in the preparation of proposals for the at Yokogawa must first and foremost in every type of industry and our ability When asked to make changes place. On an internal company basis, information system integrators seek to long-term maintenance of facilities. consider what we can do for our to utilize this knowhow to improve to specifications, we do not refuse this is accomplished by maintaining collaborate with Yokogawa. This will make it possible for our customers. As a result our customers operations at the worksite. To cite even if this is inconvenient for cost or certification systems and sharing To better promote Yokogawa’s customers to operate their plants more develop a strong sense that Yokogawa information on successful approaches; comprehensive solutions in the efficiently, and will allow Yokogawa to is a company that keeps its promises. internationally, this is done through Yokogawa’s Engineering Organization international marketplace, we came the development of global engineering work with its customers over the long up with the VigilantPlant vision for standards and continually striving to term to add value in a greater variety Know-how, systems that, even when unseen make systematic improvements. of ways. Challenges Keep Coming Even Sigapore Bangarore infomation Engineering events unfold, vigilantly maintain In addition to helping companies After a Project Order Is Booked CEC HQ CEC office control over entire production facilities improve the efficiency of their Comprehensive Solutions while also gathering, analyzing, and production operations, Yokogawa is Wuxi Work process, sharing information. VigilantPlant keen to work with enterprises engaged Don’t expect smooth sailing once an Backed by a Wealth of Expertise Tokyo CEC document Engineering embodies the Yokogawa approach in infrastructure-related and other order is booked and a project gets CEC office in Production Operations of steadfastly going the extra mile non-manufacturing lines of business underway – challenges can and will Manira for its customers in response to their by offering solutions that address a come from every direction: disconnects A key factor that enables Yokogawa CEC Project challenges and needs. wider variety of needs in areas such as between the worksite and management, to come through and honor its project participation Engineering technology development, procurement, partner organizations that do things commitments to its customers is CEC Bucharest office logistics, and services. differently, almost daily changes to that we are a provider of a truly CEC Yokogawa will work with its specifications, problems with the comprehensive set of solutions for customers to provide solutions that recording of expenses… plant operations. As stated earlier, create a brighter future. With this Even when faced with a succession of we base our proposals on an analysis Central engineering centers play a central role in strengthening our engineering capabilities by gathering and strategy, the trust that our customers such problems, however, Yokogawa’s of the problems that our customers sharing engineering know-how around the world place in us is indispensable.

18 19 Yokogawa 100th Anniversary Yokogawa’s Strengths Globally Recognized Technology and Quality

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

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. However, as Yokogawa was not as stage of globalization. At this time 20% is still centered in Japan, our offices in well known internationally as it was in its to 30% of our sales were coming from other countries are playing a role now in home market, our international business outside Japan, and by 2006 this had developing highly specialized products Business Expansion Targeting the had to withstand hardships until the passed the 50% mark. and software in those areas that are their Global Market time was right. Throughout the 1980s strengths, and this is resulting in the and 1990s, Yokogawa endeavored to creation of globally competitive products After the merger with Hokushin Electric increase orders by emphasizing the Aiming to Be the Global No. 1 in and solutions. Works in 1983, the development of formation of long-term trust-based Our manufacturing operations the Control Business our international business entered a relationships with major companies in continue to focus on high-variety, small- new stage. Hokushin Electric had both the oil industry and other fields. The By the 2010s, over one half of our lot production, and our production of personnel who were well versed in the company focused its energies on making employees were based outside Japan. control and measurement products market and a wealth of technologies, its products and technical strengths With the aim of becoming the global No. is centered mainly in Japan, China, was strong in the oil and steel more appealing and on building a 1 control company, Yokogawa has been Singapore, Indonesia, and Korea. In industries, and dealt in products such stronger customer base in the global carrying out a growth strategy centering cooperation with Group companies as control systems and equipment market. These steady efforts have on the control business and carrying that are engaged in the knockdown including industrial computers, aircraft resulted in the rapid expansion of sales out structural reforms to increase its production of products customized instruments, and professional-use outside Japan since the year 2000. global competitiveness. Our efforts at for local markets, the company is film projectors. By using the strengths Growth was also spurred on by the localizing our international operations constructing systems that will enable of both companies, the plan was to Vigilance marketing campaign launched have been successful because they it to promptly deliver high-quality expand our global business and open traveled throughout Europe to for our control business in 2003 and have been rooted in a desire to act in the products to its customers around the offices in Australia, India, and other gather information about the latest the VigilantPlant initiative announced best interests of the people there, and world. Wherever we do business, we Transitioning from Indirect markets. The importance of these technologies. Such efforts continued in in 2005. These strategies, which draw our next step is to construct optimized emphasize putting quality first and Exports to Direct Sales moves increased as the Japan market Europe and North America immediately attention to Yokogawa’s emphasis on systems for the entire Yokogawa ensuring customer satisfaction by matured and Japanese manufacturers Following the announcement of the after the war, and provided the company high product reliability and continuous Group that make maximum use of each providing products that are globally began offshoring their operations. One Global YOKOGAWA initiative in an opportunity to refocus on industrial attentiveness to the operations at region’s strengths. uniform in quality and reliability. the 2000s, Yokogawa sought to make instruments: a tie-up with its customers’ plants, made a great Our knowhow and expertise in the These systems have been highly itself into a global solutions and service the Foxboro Company, a contribution to increasing market oil & gas, power, chemical, and other effective, enabling Yokogawa to provide company by restructuring its businesses major US manufacturer recognition of the Yokogawa brand, industries is being shared and put to use the same high-quality solution services and training its personnel. of control equipment, and were applauded by employees of on a global scale. Yokogawa has also all over the world. As a result, we are Yokogawa was always intent on helped Yokogawa refine its our Group companies outside Japan for established Central Engineering Centers undeniably the top control business in developing an international presence. In technologies and products, their emphasis on pride and unity. This (CECs) at various locations around the Japan. We also hold the top position 1919, not long after its establishment, and set the company on a also smoothed the way in our efforts to world that bring together expertise in throughout Asia, and are targeting the Yokogawa began exporting products path that would eventually localize our operations outside Japan. engineering and project execution, global No. 1 position in the medium to through a trading company. As its lead it into the industrial With the establishment of Yokogawa thereby enabling us to provide high- long term. business continued to grow, the automation field. Electric International Pte. Ltd. in quality and responsive engineering company exhibited its products at an Starting with the opening Singapore in April 2005 to oversee our services to our customers wherever international exposition that was held in of an office in New York in global control business, Yokogawa they may be. Regarding product Belgium in 1930, and its representatives 1957, Yokogawa moved showed its desire to move on to the next development, while much of this function

20 21 Yokogawa’s Strengths Globally Recognized Technology and Quality Yokogawa 100th Anniversary

China North America Yokogawa started exporting to China in the In 1957, Yokogawa established Yokogawa Electric However, this joint venture was dissolved in 1997 1950s and established a service center in Beijing Works, Inc. in New York. This was a major step due to differences in management policies and in 1979. That same year the company signed a forward for the company as it was Yokogawa’s first corporate cultures and Yokogawa was once knockdown production contract for analog meters subsidiary outside Japan, and it was entering the again working on its own to advance in the North with Xian Instruments Factory, and began a technologically advanced U.S. market. American market. process of transferring recorder, flowmeter, single Yokogawa worked to establish its presence in this With the growing market recognition of the loop controller, and other product technologies market by, for example, exhibiting its products at Yokogawa name thanks to the company’s to companies throughout China. Yokogawa also the ISA Show in 1958. This was the company’s first achievements with major oil companies, Yokogawa helped establish a measurement engineering time at this globally renowned measurement and Corporation of America established an engineering department at a university in Xian. The business control event. In 1968, Yokogawa Electric Works center in the energy hub of Houston in 2002, and with Xian Instruments Factory expanded to the was renamed YEWTEC Corporation in order to moved its headquarters there in 2010. Currently, the Yokogawa Europe（The Netherlands） point where Xiyi Yokogawa Co., Ltd., China’s strengthen the impression that it was a technology company has subsidiaries in Canada and Mexico, Yokogawa Electric International Europe first control systems engineering company, was company, and in 1975 it became Yokogawa and is planning to expand its business by targeting established in 1985. Expansion of our business Corporation of America in order to emphasize its opportunities in areas such as offshore and shale oil Yokogawa Engineering Asia Yokogawa opened a representative office in West in China continued with the establishment of joint status as a subsidiary. In addition to helping to and gas field development. Germany in 1966. In order to expand its business （Singapore） ventures for sales, service, and production with increase our sales and strengthen our services in in the highly competitive European market, the partner companies suited for each industry and the U.S. market, the company launched knockdown Southeast Asia company established Yokogawa Electric (Europe) product. The Suzhou Yokogawa Meter Company production of flowmeters and recorders at a plant in In 1974, Yokogawa established its first B.V. in the Netherlands in 1974. Yokogawa’s next Yokogawa China（China） was established in 1988 to produce meters, and the Atlanta suburbs in 1980. manufacturing company outside Japan, major move came with the acquisition in 1982 of today it supplies meters to our customers all While these products were gaining acceptance Yokogawa Electric Singapore Pte. Ltd., and began Electrofact, a renowned Dutch manufacturer of pH over the world. Established in 1994 and 1995, in this market, the conclusion was reached that a manufacturing meters there the following year. This and conductivity analyzers that held the top share respectively, Yokogawa Shanghai Instrumentation strong partner would be needed in order to fully company’s factory received great praise throughout in several major West European markets, and the produces flowmeters and Yokogawa Sichuan develop the systems product business in North the region due to its excellent quality control and handing over of its European industrial instruments Instrument produces transmitters. In 2000, America, which was the home of the automation manufacturing technology, and it was referred to business to this company. This acquisition had a Yokogawa Shanghai Trading was established to business and a stronghold of veteran control as a model factory by the Singapore Economic great impact in terms of giving Yokogawa access expand the measuring instrument business. In businesses. In 1989, Yokogawa established a Development Board. Operations were expanded to the Electrofact network, which extended 2002, Yokogawa established Yokogawa Electric North American industrial automation joint venture there in 1975 with the establishment of a sales throughout all major European markets. Rather than China Co., Ltd., its first wholly owned subsidiary with Johnson Controls, an influential automation and service company, and the establishment of manufacturing Yokogawa products, Electrofact in China, and this company launched production company in the commercial air conditioning field. an engineering company in 1986. In 1988, these promoted its own line of analytical instruments until Yokogawa Corporation of America（U.S.） of recorders in the following year. In 2008, three two companies merged, and this organization was 1984, when it was integrated into the Yokogawa sales subsidiaries in China were merged to form then integrated with the manufacturing operations Electric (Europe) business. In 1990 this company Yokogawa China Co., Ltd., which functioned as of Yokogawa Electric Singapore in 1990 to form was renamed Yokogawa Europe B.V. the head office for all of Yokogawa’s subsidiaries Yokogawa Electric Asia Pte. Ltd., thereby bringing In the same year, Yokogawa bought a stake in China. Currently, Yokogawa China is working to manufacturing, order processing, engineering, and in ROTA, a globally well-known manufacturer of expand its business in cooperation with Yokogawa services under the same roof. In 1997, Yokogawa variable area flowmeters. Yokogawa eventually China Investment Co., Ltd., which was established Electric Asia’s sales, engineering, and service acquired a controlling interest in this company and in 2012 to function as the regional headquarters. functions were transferred to the newly established based some of its flowmeter production there. Yokogawa Engineering Asia Pte. Ltd. Functioning In 1992 Yokogawa strengthened its customer as the ASEAN headquarters, Yokogawa base by acquiring the DCS business division of Engineering Asia oversaw the establishment of CEGELEC, a French engineering company, and sales and service offices and the development of establishing it as Yokogawa Contrôle Bailey S.A. Yokogawa’s business throughout this region. In (This company was later integrated into Yokogawa 2004, certain of Yokogawa Electric’s development France S.A.S.) In addition to capitalizing on these functions were transferred to the Singapore companies’ regional relationships to develop its Development Center, which had been established business in Europe, Yokogawa also benefited from to develop control system application software. their strengths that extend beyond Europe to the Yokogawa Electric Corporation Yokogawa’s Singapore operations went on to play global market. Japan 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.

Yokogawa Middle East & Africa（Bahrain）

Middle East Brazil Korea Union and the formation of the Commonwealth of an engineering center was established, and this is A representative office was established in Iran in was established in Saudi Arabia in 2006, followed Yokogawa Eletrica do Brasil Industria e Com. Ltda. In cooperation with Woojin Instruments, a top Independent States (CIS), Yokogawa’s interest in playing a key role in supplying the Yokogawa Group 1976, but was subsequently closed. In 1981, the by a service company in 2007. Yokogawa has started business in 1973 as a sales company. manufacturer of industrial instruments, Yokogawa this expanding market continued to grow. In 1993, with engineering resources. Yokogawa Middle East Engineering & Service maintained a stance in which it works closely with In the latter half of the 1970s, stronger import launched the knockdown production of industrial the company opened a representative office in Center was opened in Kuwait to prepare for the full- its counterparts in the region by, for example, restrictions were put in place by the government instruments in Korea in 1977. In 1978, the Moscow, and in 1997 Yokogawa Electric Limited Australia scale development of our business in the Middle providing training support for measurement of Brazil to protect the local electronic equipment two companies formed the Woojin Yokogawa was established to handle sales, engineering, and Yokogawa and a distributor jointly established the East. In 1990, in order to strengthen our sales and and control personnel in cooperation with local industry, so in 1983 Yokogawa transferred its Engineering joint venture. This was renamed services. Reflecting the importance of this market, sales company Yokogawa Parameters Pty. Ltd. in service systems, Yokogawa Middle East E.C. was universities in Saudi Arabia, and by employing both technology to the Brazilian company ECIL S.A. Yokogawa Electric Korea in 1983 and became a which continues to grow due to the abundance 1987. In 1989, Yokogawa set up Yokogawa Australia opened in Bahrain, which is a transportation hub male and female local pensonnel. Such initiatives so that the production of distributed control wholly owned subsidiary of Yokogawa in April 1998. of natural resources, the letters CIS were added Pty. Ltd. as a wholly owned subsidiary. In 1998, in the Middle East and has relatively few religious have helped Yokogawa establish a strong presence systems could continue. With the discontinuation In 2012, Yokogawa Instruments Korea, a measuring to the company name in 2005. Subsidiaries were Yokogawa acquired another company’s business restrictions. in the Middle East, and this is now one of our most of these protectionist policies in 1992, Yokogawa instrument sales company that had been established established in Kazakhstan and the Ukraine, branch division that develops training simulators for the The Middle East is a major market, and many important markets. And in line with the growing immediately acquired a stake in ECIL P&D. In the in 1991 through the acquisition of a Yokogawa offices and technical centers were established in power industry. (This would later be merged into plants are being constructed there due to that global interest in the African market, Yokogawa following year, Yokogawa became this company’s distributor, was merged into Yokogawa Electric various CIS countries, and strong relationships have Yokogawa Australia.) Presently, Yokogawa Australia region’s abundance of natural resources and great Middle East E.C. elected in 2013 to change its majority shareholder and renamed it Yokogawa Korea. The company’s operations have grown to the been built up with leading global energy companies. has a large share of the control market in Australia, wealth, yet it differs from the European and North name to Yokogawa Middle East & Africa B.S.C.(c), America do Sul Ltda. In 1998, Yokogawa Eletrica point where it is able to take on large-scale projects. including in the electric power sector. American markets in that there is relatively little and is presently expanding its efforts to develop its do Brasil was merged into this company, and In 2002, it spun off its production operations to form India competition from local companies. Yokogawa business throughout the African continent. Yokogawa America do Sul went on to open Yokogawa Electronics Manufacturing Korea Co., Ltd., Yokogawa launched manufacturing operations Taiwan has expanded its business there by building branch offices and establish subsidiaries in which presently functions as Yokogawa’s central through the formation of Yokogawa Keonics Ltd., Yokogawa established the Yokogawa Taiwan strong customer relationships based on trust and Chile, Argentina, Columbia, and Peru. Today, production organization in Korea for temperature a joint venture with the Yokogawa distributor Blue Corporation joint venture in 1989 to strengthen its by acquiring a solid track record with influential this company continues to play an important role controllers, PLCs, and other types of products. Star and the Karnataka state-owned company industrial instrument sales and engineering functions customers, such as state-run businesses. in developing Yokogawa’s business in this key Keonics in 1987. One year following the dissolution in Taiwan. As the joint venture partner was dissolved Control systems engineering subsidiaries were South American market that has good prospects CIS of this joint venture in 2003, Yokogawa India Ltd. at the time of the establishment of this company, all established in Bahrain in 2005 and in the United for growth. In the 1960s, Yokogawa started doing business was established with the aim of building strong of that company’s employees, offices, and service Arab Emirates in 2006, and a sales subsidiary in Russia via a trading company and a plant relationships with customers in core industries such capabilities were transferred to Yokogawa, which manufacturer. Following the dissolution of the Soviet as oil, petrochemicals, and electric power. In 1994, continues its operations in this market today. 22 23 Yokogawa 100th Anniversary Yokogawa’s Strengths Globally Recognized Technology and Quality project to a successful conclusion? The required methodology, approach, innovativeness, values, and knowledge have been handed down through Excellent Execution generations of Yokogawa employees, and this capability to effectively execute projects, along with our technologies of Megaprojects, as and products, are Yokogawa strengths.

Demonstrated in the Yokogawa Selected as MAC for Global Megaproject This ability to get things done has Petro Rabigh Project been displayed in a megaproject that A cross-company meeting for the Rabigh I project is being conducted by Rabigh Refining project engineering support system The accumulated experience and and Petrochemical Company (Petro Spain, the United Kingdom, and From the onset of the project, a major Doing What’s Best for the and organization. No two projects that know-how as well as the project Rabigh), a joint venture between the Japan participated in phase I of challenge was the need to manage the company is engaged in are alike, management tools that Yokogawa Saudi Arabian Oil Company (Saudi the project (Rabigh I), a $9.8 billion the multiple industry-leading plant Customer differing even within the same industry in employees have at their disposal serve Aramco)—a state-owned oil company— (approximately 1 trillion yen) undertaking contractors in geographically dispersed Yokogawa’s strong reputation in the terms of scale, specifications, site type, as strengths, but in the end, the results and Sumitomo Chemical Co., Ltd. The that was launched at the end of 2005. locations who had been entrusted global marketplace is the result of its schedule, and the manner in which end- that they achieve depend in good part project involves the construction of one Yokogawa’s selection as the main with different parts of the project. advanced technologies, the high quality users, contractors, and their personnel on their individual capabilities. What of the world’s largest oil refining and automation contractor (MAC), in which Yokogawa’s values and tradition of and reliability of its products, and its go about their tasks. In the case of an should be done for the benefit of the petrochemical complexes1 on the Red capacity it oversaw all automation- putting the customer’s interests first ability to consistently provide solutions international project, this is compounded customer, and how can individual staff Sea coast of the Arabian Peninsula. related supply, engineering, and earned it the trust of both Saudi Aramco, that put the customer first, all of which by differences in culture, customs, and members and teams of employees Eight leading plant design and commissioning activities including which demanded the very highest levels are facilitated by a super-efficient business practices. put their skills into practice to bring a construction contractors from Italy, the simultaneous execution of 10 of quality, and Sumitomo Chemical, engineering, procurement and which staked its future prospects in construction (EPC) packages, was based Saudi Arabia on the project. Close View of the Petro Rabigh complex on the client’s wish to assign project collaboration and high-level synergy execution to a single entity and thereby in contractual and technical matters standardize equipment and system with the contractors reinforced the specifications that normally vary greatly customer’s trust and confirmed the among different plant contractors, soundness of the decision to select reduce operating burdens, and cut both Yokogawa for this project. materials procurement and maintenance costs. Yokogawa’s selection as a 1 The 25 km2 site includes a 400,000 barrel/day MAC for such a complex project was a oil refinery that is integrated with petrochemical manifestation of the trust and confidence production facilities capable of producing an annual total of 1.3 million tons of ethylene, that it earned through years of 700,000 tons of propylene, 200,000 tons of meticulous effort and high performance. propylene oxide, 900,000 tons of polyethylene, and 600,000 tons of mono ethylene glycol.

Petro Rabigh II facility (under construction) 24 25 Yokogawa’s Strengths Globally Recognized Technology and Quality

Think Ahead, Be Prepared 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, Yokogawa Saudi Arabia’s headquarters and prepared possible countermeasures based on the fundamental idea of “Think Ahead, Be Prepared.” The eight customer and emphasized Yokogawa’s Yokogawa has demonstrated its project managers signed agreements principles of taking the customer’s capabilities by carrying out projects all with the project director committing perspective to address issues and around the world in such markets as themselves to the achievement of honoring all commitments based on North America, Europe, Asia, the Middle specific project goals. As a result, the motto “A commitment made is East, Africa, and South America. The the tasks that fell within Yokogawa’s a commitment kept.” Through such company will continue to work to break areas of responsibility proceeded so efforts on the Petro Rabigh II project down barriers to international and inter- smoothly that the customer commended to meet localization requirements that company cooperation, and will foster Yokogawa by proclaiming, “You’re it has never faced before, Yokogawa the development of a workforce that always on schedule.” is demonstrating its ability to carry out is willing and able to meet challenges, To ensure on-time delivery of projects successfully. overcome difficulties, and bring projects 1,150 cabinets for the production Yokogawa Saudi Arabia is stepping to a successful conclusion. control system that was at the heart up its CSR programs by developing of operations at the Rabigh complex, human resources in collaboration with Yokogawa gave its production eight universities and sponsoring events subsidiary advance notice of this order to promote greater social engagement so that it could allocate sufficient Petro Rabigh II factory acceptance test at Yokogawa Saudi Arabia by women. Yokogawa’s development production capacity. The company set of its Saudi engineering workforce will up operations on three floors in two of all project work, personnel were has committed to executing all the work ensure that the high quality work needed office buildings in Singapore, and linked brought in from Singapore, India, and for the Petro Rabigh II project in the to achieve highly efficient and stable them by running a fiber optic cable Advancing Together through the the Philippines. And as each milestone Kingdom of Saudi Arabia and to hire operations at this complex is performed, between the buildings. These were just Development of Saudi Human was cleared, the various teams engaged local personnel, including technical staff, and will also achieve the human resource a few of the innovative practices that in this project were given opportunity for this undertaking. This commitment Resources development goals set out by the Saudi were firsts for Yokogawa in this project. to celebrate their interim achievements, is consistent with a Yokogawa principle The experience gained on the Rabigh Arabian government. Yokogawa’s To ensure smooth and timely execution building morale and promoting a friendly that emphasizes the local development I project has positioned us well for Saudi engineers will continue to add to and healthy rivalry. of human resources wherever it operates subsequent project activities that their skills and abilities by carrying out The proactive identification and and is in alignment with a program of include the hiring and training of local projects in Saudi Arabia. effective resolution of challenges and the Saudi Arabian government that engineers; the development of strong problems allowed project managers to seeks to promote the development of a manufacturing traditions through the maintain tight control over the project knowledge-based economy. local procurement of products; working as a whole so that any new problems The total investment in Petro Rabigh with local project staff whose customs could be nipped in the bud. As a result, II is approximately $8 billion.2 Five plant and practices differ considerably from the execution of this project went very contractors from Saudi Arabia, Italy, those of Japan, other Asian countries, smoothly, and the Rabigh I facilities and South Korea will install a total of and the West; and coordinating the commenced operations on schedule in nine EPC packages, and Yokogawa activities of teams made up of staff from April 2009. has been tasked with overseeing all other countries such as the Philippines instrumentation related aspects of and India. the project as MAC. For this project, To meet these challenges, Yokogawa Yokogawa has been asked to meet has promoted to a senior position a Petro Rabigh II –The Challenge a 50% localization target for all Saudi national who was involved in the of Providing Local Content procurement and manufacturing, and for Rabigh I project, hired a former intern Yokogawa was highly praised by the Saudi nationals to make up at least 20% from a local university to serve as a customer for its work on Rabigh I, and of its workforce. project manager, and established a was once again selected to serve as women-only Saudi work team that has the MAC for the phase II project (Petro been placed in charge of the preparation Rabigh II), a feasibility study for which of computer graphics and planning documents. Yokogawa has prepared was started in 2009. The Petro Rabigh 2 The expansion of an existing ethane cracker and II project involves the construction of a construction of a new aromatics complex will a plan to ramp up the project over an enable an additional 30 million standard cubic 11-month period, covering not only complex that will produce high added feet of ethane to be processed daily. That and value petrochemical products. While the approximately 3 million tons of naphtha work but also the leisure activities of the much of Yokogawa’s work for Rabigh I produced annually will serve as the main project personnel. This has promoted feedstocks for the production of a variety of high a unified teamwork approach with the A team building bowling event for Rabigh I project was carried out in Singapore, Yokogawa value-added petrochemical products. Rabigh I facility in operation 26 27 Yokogawa 100th Anniversary CSR Initiatives Good Citizenship 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 Contributing to Society, People, 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 and the Earth instruments that are referred to in the industry as “mother tools,” and supports the development and production of superior products. of support services that ensure the other countries. (1) Ensuring safety (2) Reducing energy consumption and (3) Promoting the use of clean energy increasing efficiency The Relationship between correct, safe, and reliable operation Yokogawa takes its global and management of entire production responsibilities seriously, and has shown Business and Society facilities, the improvement of operational its intent to work toward the realization The basic concept for CSR at Yokogawa efficiency, and the safe suspension of of a sustainable society by participating is building a sustainable society through operations when errors occur. Today, in the UN Global Compact. Dedicated to broad-ranging activities in the areas of Yokogawa is engaged in providing its ten principles on human rights, labor, measurement, control, and information. control equipment and systems for the environment, and anti-corruption, This concept is based on the ideas of renewable energy applications, including the entire Group is seeking to maintain our founder and it underlies everything wind, solar, and geothermal power compliance with regional regulations and Yokogawa has accomplished with its generation, and is achieving significant international standards, and is engaged business up to this point. growth in those fields. in dialogue with its stakeholders on As the main automation contractor (MAC) Yokogawa supplied control system solutions As a MAC, Yokogawa was involved from With his founding principles of putting these topics. for the Map Ta Phut Olefins petrochemical that reduced both the environmental burden the early stages in planning the control quality first, having a pioneering spirit, At Yokogawa, our CSR efforts can be industrial complex project in Thailand, and cost of operating two boilers and four solutions for a second-generation bioethanol and contributing to society, our founder Good Citizenship described as creating new value with Yokogawa helped reduce maintenance sets of turbine generators at one of Kaneka production facility for the Brazilian company Tamisuke Yokogawa made clear that customers and engaging in a Business and engineering costs by maintaining Corporation’s main chemical plants. In GranBio Investimentos. Obtained from non- consistency in the control system equipment addition to achieving a 1,000 ton reduction food organic sources such as wood chips the relationship between business and Based on the idea incorporated in our to Business to Community (B to B to specifications. The company also enhanced in CO2 emissions, alarm situations were and straw, bioethanol is often mentioned as corporate philosophy that Yokogawa’s C) model that seeks to pave the way society is to be taken seriously. safety and efficiency by integrating this reduced 85%. a clean energy source that can replace fossil These ideas and the essential nature people are to be good citizens, the to a brighter future for our customers, facility’s production control and safety fuels. By optimizing the control systems of our business, which involves the use company has sought throughout its industry, and the Earth. The aim is to instrumented systems. and field instruments at these facilities, of measurement and control for the 100 year history to be engaged at the supply products and solution services Yokogawa is helping to increase productivity development of industry, determine local community level. While always that take into account not only the and reduce operator and engineer workload the path that the company will take to placing the top priority on compliance, needs of our customers but also the over the entire plant lifecycle. support both companies and society. Yokogawa has continually striven to be communities that we live in and the Earth In 1988, a Yokogawa corporate sincere and cooperative in its dealings that we all call home. The words of our philosophy was formulated that with people around the world, which founder, who exhorted us to “become 2. Being a Good Neighbor reconfirmed the company’s mission. has given rise to initiatives such as the known by all people in the world and sponsoring of events and volunteer make products beneficial to them,” These ideas have gained Groupwide As part of its efforts to be a good corporate citizen, Yokogawa is promoting initiatives that are helping to create a brighter future for activities. This includes activities such as continue to resonate with us today. acceptance. people around the world. The contributions made by Yokogawa the Yokogawa summer festival, initiatives have evolved over the years to include through special subsidiaries that aim to everything from the provision of product help disabled people lead independent (1) Training of technical personnel subsidiary Yokogawa Foundry in September areas. This has helped to raise awareness solutions that add value to the offering lifestyles, and the training of personnel in 1999. We are highly regarded for our efforts of the importance of maintaining sustainable In addition to expanding the technical to motivate, provide opportunities to, and environmental practices. centers that it operates at 10 plants utilize the capabilities of disabled individuals 1915 in Russia and other countries in the Founding principles based on the principle of “the right person Commonwealth of Independent States for the right job” and the implementation of (5) Cultural and scientific support Quality first Pioneering spirit Contribution to society (CIS), Yokogawa has established an skills training. automation training program at the Kazan In addition to being a top architect, National Research Technological University company founder Tamisuke Yokogawa in the Republic of Tatarstan. In China, (3) Youth workshops was a collector of antique china. Following in his steps, the company has actively Donations Yokogawa has donated 500,000 dollars Charity activities to the Yokogawa Foundation of Training In 2006, Yokogawa began offering science supported efforts to preserve traditional Anti-pollution measures of Human Resources for Instrumentation workshops that give elementary school culture. This includes the funding of the Energy saving activities in Commemoration of Su Tian, who was students in the fifth and sixth grades the creation of artistic works such as the ceiling Philanthropic activities an influential figure in China’s measuring opportunity to work on projects such paintings at Kenchoji temple in Kamakura Governance Environmentally harmonious instrument industry, and has provided as building crystal radios and radiation and Kenninji temple in Kyoto (2000 and Compliance product development Support in education and training in the measurement, control, and thermometers. In addition to allowing these 2002, respectively), and the sliding door employing people with disabitities Construction of occupational health Entering the environment Supply chain Human rights children to experience the joy of making paintings at Nara’s Todaiji temple (2006), a and safety management systems information fields to Chinese personnel. business CSR guidelines something, these workshops help them designated World Heritage site. Employment of persons Acquisition of ISO14001 certification with disabilities develop an appreciation for how important Contributing through Regional disaster (Establishment of Fairness Green procurement regional volunteer activities prevention activities science is and how rewarding it can be. special subsidiaries) (2) Employment of persons with disabilities Products and solutions that Forest conservation Promotion of diversity Safety Since the passing of the Disabled Person are good for the environment activities Labor (4) Global environmental conservation The present Employment Promotion Act in Japan in Environment Local communities Human resources 1960, Yokogawa has made a proactive In conjunction with local governments and effort to meet or exceed the mandated NPOs, personnel from Yokogawa offices * Achieving a sustainable society through business-based CSR activities and complying with international standards targets for the employment of persons with in Tokyo, Kanagawa, and elsewhere have * UN Global Compact and ISO26000 mental and developmental disabilities. For participated in forest coservation and other this purpose, Yokogawa established the environmental activities in nearby rural

28 Yokogawa’s expanding CSR activities 29 Yokogawa 100th Anniversary

Raman P. Pradeep

From Yokogawa around the Globe

Yoichi Matsunami Jimmy Pootemans

To continue to be a company in the next 100 Meidan Jin Taiji Ric years that passes down technology and provides Miyamoto Andrew products imbibed with the spirit of measurement. Arinduque Indah Permatasari To make Yokogawa a QinXi Xu Alwyn Misquith company that motivates employees and brings happiness.

Harsha A P

Happy 100th anniversary! I want to Happy 100th anniversary to a make Yokogawa a company that can cheerful and interesting company Unafraid of change, pursuing Let's be big, fabulous, and famous! contribute towards improving the that enriches people's lives. Things go better Yokogawa. Let's be progress, towards the next environment in China. our customers’ partner-of-choice. 100 years! Jan Rodenhuis Let's make the jump into new fields with the The dream Fredson Miho Saitou pride of Yokogawa Fernandes company de Sousa inside us.

From Japan’s Number Jochen One to the world’s Makara Long Number One. Tooru Yamamoto Freudenthaler Youichi Nomura

Tu Rong Be customer, employee and Ashwini Sugumaran Matthijs Spaak Alicia Hui Rong Masayuki Kawashima knowledge centric.

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

Looking ahead to Happy 100th our next 100 years. Azman Baharudin Be a truly global company that anniversary! Sander Sprenger Takashi Nakayama Soobin Lee embraces a global mindset and Gratitude, heritage, management practices but acts locally. progress - for our customers’ satisfaction.

Happy 100th Congratulations on 100 years of sucess. anniversary! I wish Yokogawa a bright future. Ma Ling Our challenge - always striving to get better. Lim Khiaw Niwat Weeragul Abel Tan Zi Hao Yuji Natori To be the global Wah Urszla Nietubyc Fahad No.1 manufacturer O. Al-Jahdali

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

30 31 Yokogawa 100th Anniversary

Thamer Wanli Sun Oleg Nekrasov Kevin Wang Steve Poole Erika Motti Gentarou Fukano Kamal

In our second century, let's keep this a cool company that Teamwork is appreciated by its customers. I wish for Yokogawa to continue Keep going May growth and advancement pioneering and leading the Yokogawa! I am accompany you! Karen Ling Sakeena development of control working hard too! Kae Lim AlAwami & measurement systems A splendid company both technology. for its employees and society - Yokogawa Gerhard Post

Natheer Al-Nasr To be recognized not only by customers for May we continue to meet and I want to see Yokogawa’s leaders its excellent products but also by the entire exceed our customers' expectations. create more visionary plans and society for its desire to make the world a Miho Kokubo Ingo Pichler drive them to completion. better place.

Kang Sung Yu Jiajia Yinka Sayomi Andy Bloodworth Myung

Yokogawa, doing its best for Celebrating Yokogawa’s 100th anniversary. customers with great passion Aiming for further progress to be an even more R. Mahalakshmi Alberto Hideki Nabeshima and vision. magnificent company.

Yuuki Shimizu Nguyen Thi Huong Masako Okui

To be a company that contributes to society through Eileen Samson Lisa Kendall technology. Damilola Adebayo Happy 100th anniversary! A company Yokogawa- every customer that continues to be sought after by is our top priority. Asami society and enriches people's lives. Fujiwara Victor Guevara

To be a stable, flexible, successful and Fun company - Able to invest in innovative company that contributes to development - Able to produce good the development of my country. He Shanshan Innovation & Win-Win May you achieve your targets! products - Satisfied customers - Profitable Maria Segovia Jifu Wang

32 33 Yokogawa’s History Our past 100 years Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 1 Becoming the Top Electric Meter acceleration of the company’s research efforts and the Maker in Japan development of an industry-leading production system. This From Company Founding to featured division of labor, mass production, downsizing of Following Western countries, Japan began to use electric instruments, and addition of high value. As a result, lights in the 1880s. By 1912, light bulbs were in use Yokogawa built a solid foundation for its business. Postwar Reconstruction throughout central Tokyo and a few railway lines had been In 1920, having grown into a leading manufacturer in electrified. However, electric meters were still all imports and Japan in terms of product range and number of employees, the outbreak of World War I in 1914 made it difficult to import Yokogawa was incorporated to modernize its management. (1915–1947) them from Western countries. There also was a movement to shift for the supply of electricity from flat-rate to tiered-rate Oscillograph: an Early Main Product of plans, and so there was an urgent need to produce electric Yokogawa meters for Japanese industry. After preparations were finished for the start up of factory After the Great Kanto Earthquake in 1923, plants in Japan operations, the electric meter research institute was came to rely even more on electricity as an energy source, The Electric Meter Research Institute countries and relying on an artistic sensibility that had been renamed Yokogawa Electric Works. While planning for the and the electricity billing system shifted completely to tiered- and Tamisuke Yokogawa cultivated by studying and collecting Asian ceramics. He mass-production of watt-hour meters, Yokogawa employees rate plans. While terminating the manufacturing of watt-hour served as the president of the Architectural Institute of Japan continued developing the industrial electric indicating meters meters that were less competitive in price, Yokogawa Yokogawa originated from an electric meter research institute (1925–1927). that would prove indispensable in the safe and accurate completed development of Japan’s first portable that was set up in Shibuya, Tokyo on September 1, 1915. He was a man of wide horizons, too. His business talents control of electricity. In 1917, Yokogawa succeeded in electromagnetic oscillograph in 1924, and it became a great The small factory had only four staff: Ichiro Yokogawa (29, were acclaimed by business dignitaries of those days, such developing prototypes that received high acclaim from hit. In addition to its low price (about half the price of later the first president), Shin Aoki (26, later the first chief as Sanji Muto, then president of Kanegafuchi Spinning K.K. universities and research institutions, and went on to release imported models), the device had a number of improved engineer), and two others. Even after the institute was When Yokogawa was founded, Tamisuke had already set up AC/DC ammeters, voltmeters, and other prototypes for features. This product won an honorary award at the 1926 renamed Yokogawa Electric Works in the spring of 1916, such companies as Yokogawa Komusho (currently, portable and switchboard use. Yokogawa also created the Peace Exhibition in Ueno, Tokyo, a first for the measuring their main focus was on analyzing imported instruments and Yokogawa Architects & Engineers, inc.) and Yokogawa industry’s first product catalog. instrument industry. The oscillograph helped boost studying how to make similar ones. Yokogawa literally Bridge Works (currently, Yokogawa Bridge Corp.). He even Yokogawa’s uncompromising pursuit of excellence, with Yokogawa’s profile as a technology company, and continued started from scratch. translated publications on Taylorism, a system of modern executives themselves visiting customers to hear their to be a major source of income until the advent of Braun- Tamisuke Yokogawa (1864–1945), founder of Yokogawa, factory-management, to introduce it to Japan. opinions on Yokogawa products, earned it the cooperation type cathode-ray tube oscillographs after World War II. was a pioneer of modern Japanese architecture. He was Tamisuke also considered starting businesses related to of such entities as the Ministry of Communications, whose Beginning in 1927, Japan was hit by a succession of born in Hyogo to the west of Osaka and graduated from the electricity, which was beginning to be widely used in Japan laboratory Ichiro Yokogawa and Shin Aoki once worked in. economic crises. Yokogawa, however, weathered them by Department of Architecture, College of Engineering, Imperial and was closely related with the field of architecture. He was As a result, Yokogawa products came to have a high increasing the sales of oscillographs and releasing groups of University (currently, the Department of Architecture, Faculty advised that the electric meter business was promising reputation. The timing for the establishment of Yokogawa products that incorporated Yokogawa technologies based of Engineering, University of Tokyo). He designed major because it could be started with relatively little capital and was perfect, since electricity was providing over 50% of the on its many years of R&D. These products included DC watt- buildings, including Japan’s first steel-frame structure for the there were few competitors in Japan. He sent his nephew, energy required to run plants in Japan in 1917. Aoki played a hour meters and portable high-frequency meters. A Mitsui Main Building, the Yurakuza Theater, the Imperial Ichiro Yokogawa, who was working at the Ministry of central role in setting standards for electric indicating prototype of a cathode-ray oscillograph that can monitor Theatre, the Mitsukoshi Main Store in Nihonbashi, Tokyo, Communications’ laboratory, to Germany to study electric meters, which also demonstrated Yokogawa’s technological micro-second level electric changes was completed in 1929 and the Tokyo Stock Exchange. meters. Moreover, he met Shin Aoki just before Aoki went to capabilities. thanks to much hard work by staff as well as advice from His modus operandi, which reveals his magnanimity as an England, and promised him financial aid. Aoki was also In 1918, Yokogawa constructed a two-story wooden many academics and electrotechnical laboratories, and soon architect, was not to draw designs himself but to instruct key working at the laboratory. With the support of Tamisuke, the factory building, and began strictly following a policy of dominated the market after its successful release. points to his subordinates and let them get on with the two young engineers visited Western electric meter factories “quality first.” Management pushed so hard that they often As Yokogawa came to be known more widely, a trademark designing. He produced architectural masterpieces mainly by and returned home after procuring the equipment needed to won orders for products that were still in development. to clearly identify the brand became necessary. In 1927, utilizing the latest knowledge acquired by visiting Western start an electric meter research institute in Japan. Nevertheless, these pushy tactics enabled Yokogawa to Yokogawa registered YEW (Yokogawa Electric Works) as its master technologies quickly, and eventually to begin trademark. In 1930, Yokogawa exhibited its precision exporting products via a trading company in 1919. measuring instruments, including cathode-ray oscillographs, With the number of employees reaching 110 in 1919, at an overseas exhibition and won an honorary award, and Yokogawa actively trained them through technology thus Yokogawa products and YEW came to be known seminars and other means. The employee training led to an outside Japan.

Mitsui Main Building

Tamisuke Yokogawa Ichiro Yokogawa Shin Aoki

Electric meter for Portable ammeter Portable oscillograph switchboards Imperial Theatre

Scale marking

Shibuya factory in 1930

36 YEW trademark registered in 1927 At the company's 10th anniversary 37 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 1 Relocation to Kichijoji and Development of Aircraft Instruments reflecting the downside of war-time management. Development of Control Devices and Wartime Operations In 1945, the government issued evacuation orders and Yokogawa had to leave Tokyo and head to distant places, As the number of employees increased to 300, the Shibuya Yokogawa entered the aircraft instrument field in the early including the foot of Mt. Fuji, where it rented buildings and factory became crowded, but there was no room to expand at 1930s. In 1930, Shin Aoki toured Europe and realized the continued operations. this location. So, considering the need for a clean environment potential of the aircraft instruments business. In 1933 In June 1945, company founder Tamisuke Yokogawa died and accessibility, Yokogawa decided to move to Kichijoji and Yokogawa started R&D of magnetos, spark plugs, aged 80, and in less than two months, the war ended. build a new factory there. This western suburb of Tokyo is tachometers, and other components for aviation use. In the where Yokogawa is currently headquartered. In the spring of same year, expansion of the Kichijoji factory started. The Yokogawa Starts Afresh with One 1930, a new two-story white factory building made of reinforced functions of the Shibuya factory were relocated to Kichijoji, Yasushi Togo Tokisuke Yokogawa Tenth the Number of Employees concrete was completed. and the headquarters function followed in 1935. Another tour The new factory building had five laboratories (each of of Western countries was made in 1936, and the Yasushi Togo, the second president, tried to change In September 1945, the management drew up a which was named after its manager), a design office, and development of aircraft instruments gathered speed. Yokogawa’s job classifications and office organizations based reconstruction plan to cut the number of employees to 1,200, manufacturing floors. Each laboratory conducted highly In May 1937, Yokogawa built the Koganei factory to mass- on his experience at a large company, but just 18 months later newly hire 400, and restart operations at the Kichijoji and independent R&D of the type often seen in universities. produce spark plugs and magnetos for aircraft. In July of the he ceded his work to Tokisuke Yokogawa (Tamisuke’s eldest Koganei factories. While many companies struggled to These laboratories developed, for example, switchboard same year, however, the Second Sino-Japanese War broke son) and Tokisuke officially became the president in 1940. survive by making other basic products such as pots and meters that could withstand rough long-distance out and the economy was placed under tight control. As a Although orders for aircraft instruments and spark plugs pans, Yokogawa stuck to a policy of not making second-rate transportation and graphic meters that could continuously result, the Koganei factory was designated by the army and increased dramatically and accounted for nearly 60% of total products, and transferred equipment and materials from the record values for electric current, voltage, and power on the navy to supply products to them. The factory continued production volume, Yokogawa’s profitability dropped because evacuation sites back to rebuild itself. Meanwhile, in line with band-like recording paper, a Japan first. expanding, tripling both in floor space and number of of the shortage of materials and labor as well as controlled the postwar democracy, Yokogawa embraced the movement In 1932, Yokogawa started to develop gas analyzers and other employees, and production increasing more than seven-fold prices. to form a labor union. A labor union was organized in industrial instruments, and in the following year, began working in by 1941. Then, the Kichijoji factory was also ordered to Yokogawa in January 1946, confirming the bond between automatic flow, temperature, and pressure controllers. Receiving mass-produce these two products. Both the Kichijoji and Yokogawa during the Wartime labor and management. patents for high-frequency power meters, pneumatic automatic Koganei factories came under military control immediately However, Yokogawa was losing about 2 million yen a equalizers, and other instruments in 1937, Yokogawa laid the before the outbreak of World War II, and Yokogawa could no In December 1941, Japan went to war against the US and month after the war, and was burdened with severance foundation for entering the control business. These longer run both factories as it liked. Britain. In the following year, an industry association was payments to employees who had left Yokogawa, the cost of developments reflected the rise of the electrochemical industry In March 1938, Ichiro Yokogawa became the first president formed by law to centrally control electric equipment makers. bringing back materials from the evacuation sites, and other in the 1930s, which increased demand for electricity and (a new position) and Shin Aoki became executive vice The production and distribution of goods and raw materials, expenditures. Moreover, about three quarters of receivables revitalized power resource development. This supplied added president. However, Ichiro died in June and Aoki in July, a as well as labor were strictly controlled. At the government’s from the military were nullified. Yokogawa overcame this momentum for electricity-related companies like Yokogawa. huge loss to Yokogawa amid intensifying economic control. request, Yokogawa started the expansion of the Kichijoji and financial crisis mainly by collecting other receivables, Koganei factories in 1942 while raising funds from outside, slashing expenditures, and selling the Tsujido factory. and built three new factories in Okubo (Tokyo), Kawagoe In April 1946, Yokogawa managed to restart manufacturing (Saitama), and Tsujido (Kanagawa) in 1943. Although measuring instruments. Everyone worked hard with Yokogawa continued to develop new technologies and kept determination to help reconstruct Japan by making manufacturing industrial instruments on a small scale, work measuring instruments, a “mother tool” for industry. for the military took up almost all of Yokogawa’s resources. Yokogawa’s labor union also staged a campaign to increase The number of regular employees was about 12,000 (16,000 production. In 1947, while going ahead with screening and including student labor). Sales for fiscal year 1944 exceeded standardizing parts to enhance efficiency and profitability, 75 million yen, but loans soared to nearly 70 million yen, Yokogawa held an exhibition of its measuring instruments at The Kichijoji factory in the 1930s Aerial photo of the Kichijoji factory Workshop at the Kichijoji factory the Matsuzakaya department store in Ginza, Tokyo to publicize its quality and technology. Thus, Yokogawa embarked on its postwar growth.

The Tomota laboratory High-accuracy resistor Indicator for the navy

Electric differential pressure flowmeter

Advertisement in October 1928 magazine

38 Test of pivots at the Kichijoji factory 39 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 2 Yokogawa started to distribution agreenment. In the same year Yokogawa signed develop electron tube a technology and sales agreement with Bendix for aviation From Postwar Recovery to (vacuum tube) type products such as the Ultra-Viscoson viscometer, magnetos, automatic control devices harnesses, and ignition devices. that were superior to the The tie-up with Foxboro was not ideal for Yokogawa as it Rapid Economic Growth mechanical devices did not allow us to modify any of the specifications for that manufactured by various company’s products. Despite this disadvantage, it helped us leading companies. meet our customers’ needs for a broader lineup of and Oil Crisis After great effort, mechanical (pneumatic) instruments and improve our Yokogawa shipped the machining skills. Thanks to this tie-up, Yokogawa was also first product, an electron- able to produce an electron-tube-type automatic recording (1948–1974) tube-type self-balancing controller (ERZ electronic recorder) that combined our ER ER electron-tube-type self-balancing recorder, or electronic with Foxboro’s pneumatic controlling mechanism. This recorder recorder (ER), in recorder sold well. September 1951. Although many problems were found with From Reconstruction to Recovery trends and new products, and set up a committee for the product after delivery and some people became Rapid Economic Growth Era in Japan proposing efficiency improvements. In 1950, a planning pessimistic about the future of the company, Yokogawa was Yokogawa managed to rebuild its business after the war and department and planning committee were set up for convinced it was on the right track and continued to make In the 1950s, Yokogawa not only delivered industrial initially focused on telecommunications infrastructure for the strengthening management. Meanwhile, wartime price improvements. This firm commitment led to the development instruments to customers but also got involved in Ministry of Communication (predecessor of Nippon controls were lifted and corporate investment improved as a of various ER instruments for measuring frequency, instrumentation projects at steel, chemical, and electric Telegraph and Telephone Public Corporation, and today’s result of a surge in procurement for the Korean War, both of temperature, flow rate, liquid level, pH, gas analysis, and power companies. Japan’s economy continued to grow NTT Group) and electric power companies, which were which benefited Yokogawa’s business. sulfuric acid concentration. rapidly during three consecutive, unprecedented economic carrying out many projects for the reconstruction of Japan. Yokogawa stopped manufacturing large-sized shouldered booms, and capital investment by companies continued to The year after the war ended, Yokogawa won a line tester 1 An oscillator generates fixed-amplitude, -frequency pulses using a DC tubes (ST) in 1952 and replaced them with the latest increase steadily. Yokogawa also expanded its business in order from the Ministry of Communication, which was power source without external inputs. "CR" stands for condenser and miniature tubes (MT). Yokogawa also introduced new this period. For example, in 1956, we completed resistor. CR oscillators are mainly for low frequencies and can be working hard to rebuild and improve specifications for chart paper, including 180 mm width paper development of an analogue computer for the measurement downsized. the telephone and telegraph and folded forms, and these were adopted by its US and analysis of the voltage, current, and power conditions of networks. After two years of R&Ds, competitors. electricity distribution grids, and also founded Yokogawa Yokogawa shipped the first line An Overseas Visit and the Decision to The development of ER instruments was significant in Aviation Co., Ltd. to manufacture aviation devices. During tester in 1948. Develop ER Instruments three ways for Yokogawa. First, research and development this period, Yokogawa also rebuilt its main factory and The line tester is an instrument that by a team (cross-organizational project) was found to be started entering the US, Taiwan, and other overseas markets. monitors and measures Around that time, two crucial events laid the foundation for advantageous. Second, Yokogawa became the first Yokogawa developed the ECS series of electronic control transmissions between relay stations Yokogawa’s subsequent growth. One was a visit by Senior company in the industry to use electron tubes for industrial systems in 1959, which fueled the company’s dramatic and terminal stations for long- Vice President Miyaji Tomota to the US and the other was the instruments, overtaking its competitors. And third, it helped growth. The ECS was compact thanks to the use of distance telecommunications. It is decision to develop electronic instruments for industrial use. Yokogawa take a leading position in the subsequent transistors and diodes. All measurement values were composed of an audio CR oscillator In December 1950, shortly after the ban on overseas travel automation era and achieve significant growth. converted into unified voltage signals of 0–10 mV for 1 (the first such product in Japan), a was lifted, Mr. Tomota took a three-month trip to the US. He communication, ensuring compatibility with other power controller, and a level meter, visited companies such as Hewlett-Packard and Bendix Tie-ups with Two US Companies instruments and facilitating modularization and mass- which are all mounted on an iron Aviation, both of which would form technical partnerships production. With the ECS for large plants and the pneumatic stand. Yokogawa’s line tester was with Yokogawa, and discussed various matters with their The focus on industrial instruments helped to meet the control system for small plants, Yokogawa received highly acclaimed and several staff. Exposure to these companies’ leading-edge needs of Japanese companies that were shifting from increasing numbers of instrumentation orders to automate hundred sets were shipped for use in technologies stimulated Yokogawa’s product development reconstruction to modernization. However, Yokogawa did factories and water facilities. Sales surged from 1.7 billion relay stations across Japan. This line efforts. This tour and subsequent business communications not have sufficient technological knowledge and experience yen in 1955 to 7.3 billion yen in 1960. In the same year, Iwao tester was Yokogawa’s main product with the US companies led Yokogawa to introduce advanced to respond to all these companies’ requirements, and its Yamasaki became the president and steered Yokogawa in those days. management tools such as IBM computers and to launch major competitors were expected to catch up soon. through Japan’s further economic growth and open At the same time, the number of the mass-production of general-purpose items by small Therefore, in 1955, Yokogawa and Foxboro, then one of the economy policy. orders from electric power manufacturing subsidiaries (the division system, started in four major industrial instrument manufacturers in the US, companies increased, and thus 1953). Through such means, Yokogawa was able to boldly signed a technical assistance and Japan exclusive Yokogawa continued to grow. consolidate products and specifications and thus overcome By selling its Koganei and the sharp rise in raw material prices caused by the special Kawagoe factories, Yokogawa procurement boom during the Korean War. Line tester increased its capital and was The trip also gave Yokogawa confidence in developing able to go public in November industrial instruments. A few years earlier, around 1948, there 1948 (listed in May 1949), thus had been heated debate within Yokogawa on which business setting the stage for further to focus on: industrial instruments, for which demand was growth. expected to increase on the back of the growing oil and In 1949, sales fell sharply as chemical industries, or measuring instruments for a result of the Dodge recession, communications and aviation, in which Yokogawa had a solid and Yokogawa introduced track record. Yokogawa subsequently decided to focus on Iwao Yamasaki technical conferences where industrial instruments, with an eye on expanding automation employees could freely discuss in the US and Europe, and this business trip supported that research and development Wide-angle instrument decision. The Foxboro headquarters ECS

40 41 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 2 Intensified Competition market thanks to its ER and ECS products and Kogyo K.K. for analyzers, CHINO Works (the current CHINO) for the Tokyo branch office was relocated to Yaesu in central instrumentation work, the company believed that the core temperature controllers, Asahi Kohsan for instrumentation work, Tokyo. Administrative work efficiency was also improved In the 1960s, major electric companies such as Hitachi, technology of the future would be digital computers rather Hokushin Electric Works for recording paper, and IBM for greatly by introducing an IBM360 computer. And in the Toshiba, Mitsubishi Electric, and Fuji Electric entered the than analog devices, and so decided to devote human computers. company’s manufacturing facilities, productivity started to measuring and industrial instrument fields. resources to such projects, ahead of the competition. The rise with the introduction of leading-edge equipment and Although Yokogawa had an approximately 30% share of first result was a computer control system (CCS) released in End of the Rapid Economic Growth Era quality control activities. the measuring instrument market in Japan at that time, 1962 that performed centralized monitoring and control of However, the Japanese economy started to slow down President Yamasaki worked hard to strengthen Yokogawa’s plants and revolutionized central control room operations. Leaving the high-frequency measuring instruments business after the Osaka Exposition in 1970, and the Nixon shock position by streamlining operations and constructing a new to YHP, Yokogawa focused on growing its general measuring (dollar crisis) in 1971 caused great difficulties for most R&D center (completed in July 1962). Following the set up of instruments, industrial instruments, and instrumentation manufacturers, including Yokogawa. In 1971, when Toshinori a US office in 1957, he also tried to expand exports by systems businesses. When the stock market took a turn for Matsui became the Yokogawa president, the company had exploring communist bloc markets and signing agreements the worse in 1965, sales declined for both Yokogawa and fallen behind its competitors in sales revenues. Yokogawa with distributors in North America, Europe, Asia, Australia, YHP. In 1966, Miyaji Tomota took over as Yokogawa’s therefore acquired Nakaasa and Central and South America. In 1962, Yokogawa and president and sought to strengthen Yokogawa’s business by Instruments Co., Ltd., a Voltron Products Inc. (US) set up a joint venture, Acrohm reducing the number of product models and overhauling the meteorological instruments Electronics, for manufacturing electric instruments in the US. company’s administrative functions. Business conditions in manufacturer, and signed a sales Regarding products, Yokogawa developed the COM-21 Japan started to pick up again in November 1965 and tie-up agreement with Tokyo Keiki network analyzer for electric power companies in 1961, and remained strong until July 1970. for marine instruments in July a measuring instrument that was selected by NASA for use In terms of products, the launch of the CCS in 1962 was 1972. In the same year, the in ionosphere rocket experiments. A significant decision was followed by the release of the YODIC-500, Japan’s first company acquired land for a made at this time to start developing digital control double CPU direct digital control (DDC) system, and the second production facility in Kofu, technology. Although Yokogawa was leading the automation EBS, electronic control system, in 1966; and the YODIC-600, Yamanashi, where there was more Toshinori Matsui Ionosphere measuring instrument a fully duplex DDC system, in 1970. These products space for future expansion. mounted inside a NASA rocket employed some of the same highly reliable technologies, However, in October 1973 when that would later be used to develop the CENTUM integrated construction of the Kofu factory was just about to start, the Setting Up of Yokogawa-Hewlett- production control system. first oil crisis struck, and all advanced economies, relying on Packard Yokogawa also entered the process analysis instruments oil-dependent mass-production and mass-consumption, business. Starting with the release in 1966 of its first process entered recession. The Kofu factory, which was completed Yokogawa sought a technical tie-up with Hewlett-Packard gas chromatograph, which featured an ER for added value, in July 1974, started operation amidst an economy that was (HP) in the US to acquire expertise in high-frequency and Yokogawa continued to develop various technologies and by shrinking for the first time since the war. Japan’s rapid microwave technologies that were becoming increasingly the 1980s had captured a 90% share of this market in Japan. economic growth ended and Yokogawa was forced to seek important in the electronics field. In 1969 the company released a B/M meter (for use in paper new avenues for growth in a slowly-growing economy. The negotiations had a rough start because HP’s policy mills to measure basis weight and moisture), and in 1970 the prohibited the provision of technology to anyone other than company came out with a sulfur content meter that would its wholly-owned subsidiaries. In April 1963, both parties later be used to enter the US market. finally agreed to set up a joint venture in Japan, and To boost sales by strengthening relations with customers, Yokogawa-Hewlett-Packard (YHP, the current Hewlett- AC network analyzer 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

YODIC-500 The Kofu factory

Miyaji Tomota B/M meter

R&D center Signing ceremony to form YHP Gas chromatograph Sulfur content meter

42 43 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 3 For operators who were unfamiliar with CRTs, displays Improving Financial Strength were modeled after conventional operator panels. This style From Steady Growth to was called a “virtual panel” and its originality and excellent In those days, Yokogawa was slow to collect receivables and design were highly evaluated. The virtual panel won several was shackled with excess inventory. Various efforts awards in Japan, including one from the Japan Society for improved the collection of receivables, but reducing the Bubble Economy the Promotion of Machine Industry in 1976. inventory required the restructuring of a system involving the After the oil crisis, manufacturers were struggling to manufacture of a wide variety of products in small quantities. survive by shedding manpower and saving energy; CENTUM Yokogawa decided to improve its information system first, and Its Bursting helped them by assuring safe, efficient, and stable and then its production lines. operations. In December 1985, 10 years after its first release, In February 1975, Yokogawa installed the New Order Yokogawa shipped the 1,000th CENTUM system. This Processing System (NOPS), and this was followed in (1975–1990) proved that CENTUM was highly valued in the marketplace. December by the Production Information and Control Around this time, sales were boosted by the development System (PICS), which was suited to manufacturing a wide of a car exhaust measuring instrument that helped assure variety of products in small quantities. The two systems were Overcoming Difficulties CENTUM: the World’s First DCS compliance with environmental protection requirements, and then optimized to work together. Drawings, parts tables, and by cooporation in the medical equipment business with part numbers were systematized so that many manual In November 1974, the year after the first oil crisis, Yokogawa In June 1975, Yokogawa released CENTUM, the world’s first General Electric (GE). As a result, Yokogawa, which had operations could then be performed online dramatically welcomed a new president, Shozo distributed control system (DCS) and the culmination of the suffered falling sales and income in fiscal year 1975, improving speed and efficiency. Yokogawa, the third son of company’s digital control technologies, expertise, and know- gradually recovered. By 1977, despite having had to furlough Yokogawa started overhauling production lines in 1978 Tamisuke Yokogawa, the founder how. With conventional, centralized control systems, any employees, the company was generating record-high orders and tested many things, including a just-in-time production of Yokogawa. Shozo had been the failure in one computer affected the whole system and made and sales. system. In 1980, Yokogawa set a company-wide goal of president of Yokogawa-Hewlett- it difficult to confine risk. A DCS was needed to overcome halving production costs. In 1981, Yokogawa became a New Packard since its foundation in this problem and optimize the system configuration of a Production System member and introduced the New 1963, and this company had plant, depending on its size. By using microprocessors, Yokogawa Production System (NYPS) philosophy to reform grown quickly under his Yokogawa solved a variety of technology issues and all stages of work from designing to producing parts, leadership. On assuming the successfully developed the new DCS. assembling finished goods, and shipping, for total presidency of Yokogawa, he Because Yokogawa had already developed highly reliable optimization. Operational efficiency was improved greatly. clearly stated that he would value Shozo Yokogawa technologies for duplicating control systems, it was able to The spread of NYPS was helped by the introduction of mutual understanding between develop the DCS ahead of its competitors. Unitization of a information processing systems: the COSMOS order labor and management, help everyone to enjoy work with a control system for optimal configuration, central monitoring processing system in 1982, the COSMOS–B (measurement) sense of purpose and make full use of their abilities, and and control with CRT displays, excellent system system in 1984, and the NYCE cost management system increase our added value for the lasting growth of Yokogawa. expandability, simple instrumentation setup, and integration and the NICMOS procurement management system in 1985. He also explained about measures that would be needed with computers for production control–––all these to overcome challenges that the company faced and capabilities led to the world’s first DCS. Ceremony to mark the shipment of the Car exhaust measuring 1,000th CENTUM system instrument (CO/HC tester) 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 Entering the Medical Equipment Market things from the customer’s perspective; and share expertise by cooporating with colleagues. He also noted that he In December 1976, Yokogawa set up a CT Division and wanted to make Yokogawa a company where anyone could entered the medical equipment market in September 1977 talk with anyone else, at anytime and anywhere. 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 Launch of NOPS its product lineup in 1978 and 1979, respectively. The CT Division was renamed the Medical Equipment (ME) Merger with Hokushin Electric Works Division in 1980. After adding Yokogawa’s diagnostic ultrasound imaging system and full-body CT scanner to the In the 1980s, Yokogawa was trying to enter new markets product lineup, the outside Japan because the market for plant construction in ME Division achieved Japan was expected to become saturated soon. In addition, growth and was spun general electrical equipment manufacturers with superior off in 1982 to form semiconductor/computer technologies and stronger Yokogawa Medical finances were beginning to enter the industrial instrument Systems (YMS, market. Yokogawa consequently decided to merge with currently GE Hokushin Electric Works, the third-largest company in the Healthcare Japan), a Japanese industrial instrument market. joint venture with GE. Hokushin, which had been founded in 1919, had pioneered Yokogawa’s full-body CT scanner the production of industrial thermometers and process

Released in 1975, the first CENTUM system

44 45 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 3 control computers in Japan. At the time of the merger, the relocation to the new company’s headquarters was Yokogawa released many products, such as the CENTUM V company, which had the top share in Japan in the differential completed. system, the YEWPACK–MARK II control system, the pressure transmitter and electromagnetic flowmeter In 1986, the company name was changed to Yokogawa CENTUM–XL system, and the μXL distributed control system segments, enjoyed a high reputation for its technology and Electric Corporation to strengthen the corporate identity. The for small- and medium-sized plants. Covering plants of all was one of the three dedicated industrial instrument YEW trademark was also changed to the current symbol and sizes, the DCS business entered its prime years. companies in Japan, along with Yokogawa. brand logo, which people worldwide found easier to Yokogawa began to diversity its business in the 1970s. To

Both presidents decided on this merger based on mutual understand and remember. In 1988, Yokogawa defined its meet the needs of customers in the electrical and electronics YEWCOM9000 trust and a shared sense of crisis. They aimed to create the corporate philosophy, marking the final step of the merger. segment, which had come to the fore as a result of structural world’s top dedicated industrial instrument company, by Yokogawa’s resources, including technologies, increased changes in Japanese industry in the 1980s, Yokogawa pulling together capable employees from the two companies as a result of the merger. This advantage enabled Yokogawa restructured its electronic measurement business and and by providing outstanding service to customers that only to enter new fields, release many new products, and quickly entered the semiconductor tester and digital oscilloscope such specialist companies could provide, thus overtaking set up several Group companies outside Japan. markets. Yokogawa also utilized the development and sales the competition. personnel who had joined as a result of the merger in order Analog LSI tester On April 1, 1983, Yokogawa Hokushin Electric Corporation Stronger Yen and Yokogawa’s to develop other system businesses outside the process was established. Shozo Yokogawa became president, and Diversification automation (PA) field. FA500 Masahiro Shimizu (the former Hokushin president) vice Firstly, targeting control and information systems for non- president. The new company started with 5,800 employees In the early 1980s, high-performance yet low-price Japanese continuous processes, the factory automation (FA) business exporting products. As a result, Yokogawa came to be and an annual sales target of 120 billion yen. products flooded Western markets and led to trade friction. released many new products, covering areas ranging from the known widely. At the start, Shozo Yokogawa emphasized his Japan came under pressure to take measures to make the provision of products to system construction. These products In the 1960s, Yokogawa was exporting its measuring management philosophy: “One for all, all for one.” He urged yen stronger and increase domestic demand. Though it had included the YEWCOM super minicomputer, the YEWMAC instruments to Western Europe through agents (direct former Yokogawa and Hokushin employees to cooperate suffered a high-yen recession in 1986, Japan’s economy manufacturing line control system, and programmable logic export) and to Eastern Europe via trading companies closely with each other in order to make the merger a once again started picking up at the end of the year. controllers. YEWMAC was used as a platform not only for FA (indirect export). In 1966, Yokogawa set up a representative success. As expected, harmonization was not easy at first. After the merger, the control business grew steadily. but also for PA and building automation (BA). office in Hamburg to boost sales. Even though the stock swap ratio for the merger had been Secondly, taking advantage of the boom in the In 1973, Yokogawa encountered a number of issues with calculated based on each company's assets and stock construction of intelligent buildings in the late 1980s, Foxboro that led it to terminate that tie-up in 1975. Yokogawa price, and was favorable to Yokogawa, management Yokogawa entered the BA market, which involves the took this crisis as an opportunity to strike out on its own and repeatedly made it clear through personnel policies and energy-efficient automatic control of equipment such as hurriedly built its own sales and service network. other measures that the two companies were equally building air conditioners. Yokogawa also went into laboratory Yokogawa established a sales and service office in Brazil balanced, both in terms of human resources and technology. analysis, office automation (OA), and laboratory automation in 1973; a manufacturing subsidiary in Singapore and a sales As a result, the new company started to come together and (LA). Throughout the 1980s, Yokogawa continued to enter and service office in Europe in 1974; and a sales and service its performance and market share began to rise. new markets, although it would later withdraw from some of office in Singapore in 1975. In 1982, Yokogawa bought Following the merger, the new company’s sales them. Electrofact, a Dutch analyzer manufacturer, and made it department opened its offices in the Shinjuku Center responsible for the sales network, technology development, Building and the Shinjuku NS Building. New offices and manufacturing, and after-sales services across Europe. factory buildings were constructed one after another at the Meanwhile, Yokogawa built a long and amicable headquarters. The Shimomaruko factory, where Hokushin relationship with China. Normalization of diplomatic relations used to be headquartered, was sold off in 1985 and thus the 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 YEWMAC Xian and this later led to the formation of a joint venture. In At this 1956 Yokogawa exhibit of automation solutions, a first for Japan, the company also featured Hokushin products 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 μXL advertisement Digital oscilloscope 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 The Yokogawa Hokushin Electric logo Developing Non-Japan Markets with the Spirit of Mutual Benefit global hit. Yokogawa gradually made its presence felt

Since 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, After the signing ceremony, President Yokogawa (left) shaking hands with President Shimizu The current symbol and brand logo participating in exhibitions, exchanging technologies, and Yokogawa Electric Singapore (founded in 1974)

46 47 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 3 throughout the world. Nevertheless, Yokogawa established its first non-Japan To make this dynamic strategy a success, detailed engineering subsidiary in Singapore in 1986, and then Column guidelines needed to be shared among all employees. In expanded in Southeast Asia and South Asia, followed by October 1973, Yokogawa issued an in-house newsletter other areas. describing its policy for managing Group companies outside In those days, Japanese engineering companies were The History of Hokushin Electric Works Japan and urged all employees to understand and follow it. entering overseas markets because the Japanese market was The policy emphasized the “spirit of mutual benefit,” under stagnant. By working with such Hokushin Electric Works was established by Souhei Shimizu at Azabu, Tokyo in April 1919 to manufacture industrial which Japanese employees helped other countries develop companies, Yokogawa also meters. “Hokushin” is the Chinese name for the North Star, which has guided travelers since ancient times. and share profits locally. Other major objectives were to train expanded its own business Confucius said, “He who exercises government by means of his virtue may be compared to the North Star, which local employees and appoint them to managerial posts for overseas. Moreover, the merger keeps its place and all the stars turn towards it.” Souhei Shimizu named his company after these words of wisdom, true localization. This covered processes ranging from the with Hokushin provided many hoping that the company would become a leader of Japanese industry. machining of parts to their assembly and distribution employees who were experienced Hokushin started its business manufacturing thermometers. After moving its headquarters and factory to worldwide in order to secure high quality and add high value. in international business, while the Shimomaruko, Tokyo, the company manufactured devices for marine vessels and aircraft. During World War II, the With the spirit of mutual benefit, Japanese employees both appreciation of the yen made it company produced 70% of all aircraft instruments for the Japanese army and navy and its compass was installed in in and outside Japan overcame many hardships in easier for Yokogawa to expand most key warships. Hokushin thus became one of the major instrument makers in Japan. developing business globally. As a result, Yokogawa earned abroad. Takashi Yamanaka, who However, it lost 85% of manufacturing facilities during air raids and military demand vanished when the war ended. became president of Yokogawa in the trust of local employees and customers and Group Takashi Yamanaka Hokushin made a fresh start focusing on industrial meters, and then resumed manufacturing marine navigation and companies outside Japan came to operate autonomously. 1988, also strived to expand aircraft instruments. Through tie-ups with Western companies, Hokushin accumulated sophisticated technologies and In the late 1970s, Yokogawa entered the non-Japan control outside Japan while strengthening sales organizations in gradually became competitive. The company made a success in the electronics field with the HOC series (Japan’s first market by engaging in the high value-added DCS Japan. calculator for the process industry) and Japan’s first direct digital control system. With products such as a large-bore engineering business on a full-scale basis. However, to win Japan had enjoyed a thriving economy since 1986, but in electromagnetic flowmeter and various automation devices for marine vessels and aircraft, Hokushin became a well- customers’ trust in the control business, it was essential to early 1990, stock prices began to plunge, followed by land known name in the industry. At the time of the merger with Yokogawa, Hokushin was the third-largest measurement hire capable local people who were responsible for all prices, which then hit the real economy hard. The bursting of and control company in Japan, after Yokogawa and Yamatake-Honeywell (currently, Azbil), with 2,200 employees and operations, from sales and engineering to after-sales the bubble economy drove the Japanese economy into a sales of 38.9 billion yen (in fiscal year 1981). services. In addition, it was necessary to establish a system long, dark tunnel that has been called the “two lost The sales breakdown was as follows. to enable non-Japan Group companies to get support from decades.” Industrial instruments: 74.6% (HOC series, 900/TX series microprocessor-based instrumentation system, HOMAC Yokogawa Electric Corporation. This required a major and EK series electronic control system, recorders, transmitters, electromagnetic flowmeters, investment and was a difficult hurdle to overcome. 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 Hokushin logo

Formation of a joint venture in Xian, China

Yokogawa bought Electrofact, a Dutch company, in 1982

Autopilot system, a mainstay Hokushin product HOMAC series electronic control system Yokogawa Corporation of America Yokogawa Keonics Yokogawa Electric Asia

48 49 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 4 In the late 1980s, there was an increasing need to integrate the same capabilities and open features of the latest control systems for optimizing and streamlining all factory general-purpose computers, and the capability to support Overcoming the Post-bubble operations. In addition, customers wanted to integrate fieldbuses, while maintaining the reliability of the DCS control systems with management systems, and consolidate platform and backwards compatibility with previous the control rooms used CENTUM generations. Recession and the Beginning of for separate To expand the range of solutions, Yokogawa also jointly production facilities. developed advanced control software packages with Control systems were customers and engaged in M&A. In 1997, Yokogawa the Age of Globalization also required to acquired GTI-IA, a Dutch company specializing in safety support general- instrumented systems, and in 2005, released the ProSafe- purpose technologies. RS safety instrumented system. In the analyzer business (1991–2010) To satisfy field, Yokogawa took a 51% stake in Measurementation, a customer’s needs for a leading analyzer systems integrator in the US (later sophisticated control integrated into Yokogawa’s US subsidiary). “VECTOR 21” and Organizational Developing Unique Products platform that was both To take the information business to the next level, Reform flexible and open, The Fieldbus Foundation logo Yokogawa acquired Marex Technology, a British company, In those days, Yokogawa developed many new products by Yokogawa introduced to develop a common platform for manufacturing execution The stock market plunge in January 1990 precipitated the using its unique technologies. The DPharp differential the CENTUM CS integrated production control system in systems (MES) that manage and use data collected by collapse of Japan’s bubble economy and the start of the pressure/pressure transmitter released in 1991 sold strongly 1992. Its CPU relied on a pair & spare architecture that DCSs. In 2000, Yokogawa added to its lineup the “two lost decades.” Customers simultaneously revised because of the high accuracy and reliability achieved by eventually enabled CENTUM series systems to achieve Exaquantum plant information management system, which downward their capital investment plans and performance using the world’s first silicon resonant sensor. The confocal seven-9s (99.99999%) availability. uses Marex’s technology. forecasts. In fiscal year 1991, Yokogawa managed to scanner released in 1996 was also highly acclaimed in the Meanwhile, since the mid-1980s, several suppliers had increase sales but operating income dropped significantly. field of life science and adopted by research organizations in developed their own digital communication bus systems, 1 A New Long-term Corporate Strategy Yokogawa announced the VECTOR 21 corporate vision in many countries. The technologies in these products won which made it difficult to interconnect field devices. For the for Achieving a Profitable Structure 1992, aiming to become an industrial automation (IA) prestigious awards in Japan such as the National convenience of its customers, Yokogawa advocated the company in the years leading up to the 21st century by Commendation for Invention and the Okochi Memorial development of a new international fieldbus standard, and In 1998, Yokogawa’s sales and profit dropped sharply due to unifying process automation, factory automation, and Technology Prize. worked hard to make it happen. By leading the effort to unprecedented negative economic growth in Japan and the laboratory automation, based on the company’s founding develop consensus among multiple standardization bodies, Asian currency crisis. Amidst these difficulties, President principles and corporate philosophy. This vision was Yokogawa played a key role in getting a new standard Mikawa passed away in June 1999 and Isao Uchida, intended to make employees aware of the drastic changes in created in 2000. executive vice president, took over. the business environment and urge them to work together to overcome difficulties. Reforming the Control Business and In July 1992, Yokogawa reorganized each business’s sales, ETS development, and manufacturing divisions into strategic business units (SBU) in accordance with VECTOR 21. As technologies were becoming increasingly open, Responsibility and authority were delegated to the individual Yokogawa noticed changes in the DCS market and started SBUs to enable them to respond appropriately and quickly to DPharp differential pressure/pressure reforming its control business accordingly. transmitter released in 1991 changes in the market environment. All organizations were In July 1997, Yokogawa announced a new business divided clearly into cost centers and profit centers, and it was concept, “Enterprise Technology Solutions (ETS).” With ETS, made clear that profit centers would be evaluated based on Yokogawa aimed to provide optimum, cutting-edge control their profits. Thus, Yokogawa became profit-oriented. technology solutions to address specific needs that its However, both sales and profits in fiscal year 1992 fell far customers faced in their business operations. Thus, below the target. The decrease in sales and the increase in Yokogawa shifted its focus from the product business to the high-cost engineering were the reasons for this poor solution business. performance. As platforms to achieve ETS, Yokogawa released Eiji Mikawa, who became president in June 1993, focused CENTUM CS 1000 for small- to medium-size processes in on reducing the cost of existing 1997 and CENTUM CS 3000 for large-size processes in products, accelerating the 1998. These systems met customers’ expectations by having CSU10 confocal scanner unit development of new products, improving sales efficiency, and streamlining headquarters CENTUM CS 1000 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 Eiji Mikawa for non-manufacturing industries.

1 Standing for value, excellence, challenges, teamwork, open-mindedness, and responsibility, this also refers to a force that has both direction and magnitude. Ceremony to mark the first shipment of DPharp ETS was presented at Tokyo (photo) and other locations ProSafe-RS

50 51 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 4 In 2000, Yokogawa announced a new corporate strategy, bubble and the terrorist attacks of September 11. Yokogawa Transforming into a Global Company The Second Milestone of the VISION-21 & ACTION-21, to adjust to structural changes in made every effort to avoid losses, including slashing costs, under the Vigilance Campaign VISION-21 & ACTION-21 Plan and the the Japanese market and intensifying global competition. reducing pay, and furloughing staff. In 2002-2004, 15 of the Financial Crisis in 2008 With this strategy, Yokogawa aimed to become a sound and 19 production facilities in Japan were closed, and the global With a growing reputation and thanks to winning preferred profitable company and set profit targets for fiscal year 2005. system for procurement, production, and logistics was supplier contracts, Yokogawa’s control business expanded In 2006, The company also aimed to expand the measurement and revamped. Under this new system, as of November 2015 steadily, and yet cases still occurred where Yokogawa was Yokogawa information businesses, which, together with the control there are seven plants in five countries that produce a variety not included even in the first round of the tender process in identified areas business, would serve as the three main pillars for of products for the global market, seven plants in six Europe and North America because of its low profile. for strategic Yokogawa. countries that produce control and measurement products Recognizing the importance of branding in the control investment and In the measurement area, for the local market, and five plants in Japan that produce market, Yokogawa started its Vigilance campaign, which set numerical Yokogawa formed an alliance with products for other businesses. The Group companies in reflected its commitment to watching customers’ plants targets for fiscal Ando Electric in 2001 and then Japan were also reduced and integrated. around the clock, throughout the year. This message was year 2010 that acquired all its stock in 2002. In At the same time, Yokogawa strengthened its financial welcomed by our offices outside Japan as it reflected the would serve as 2004, the company integrated all of position. For example, it sold off Hewlett-Packard Japan (the value that they offer to customers, and it thus helped to unify the second Ando's businesses. The former Yokogawa-Hewlett-Packard) stock and converted the all the Group companies. Gaining traction with our milestone for Kanazawa office measurement business, with optical preferred stock of GE Yokogawa Medical Systems (former customers, this campaign entered a new stage in 2005 with VISION-21 & ACTION-21. The plan was to capitalize on the measuring instruments and Yokogawa Medical Systems). Using part of these capital gains, the announcement of our VigilantPlant initiative for achieving structural reforms that had been carried out in the years leading semiconductor testers, was Yokogawa eliminated a shortfall in the reserves for retirement the ideal plant. On the same day as that announcement, up to fiscal year 2005 by expanding new businesses in such reorganized into the communication pensions and compensated for an extraordinary loss President Uchida revealed the goal of becoming the global fields as measuring instruments, life sciences, and photonics, and measuring instrument business Isao Uchida associated with the reduction and integration of subsidiaries. No. 1 in the control business. This, combined with the and thereby achieve significant growth. Yokogawa established a and the advanced test equipment Thus, Yokogawa quickly restored its financial health. release of the ProSafe-RS safety instrumented system, life science facility in Kanazawa in 2005, and started manufacturing (ATE) business in 2003. Sales for the ATE business increased attracted much attention in the industry. photonics products at the Sagamihara factory in 2007. dramatically, making a great contribution to consolidated profits. Making Engineering More Competitive In the same year, Yokogawa set up Yokogawa Electric In April 2007, Shuzo Kaihori became president. That same In the information field, Yokogawa worked on many new International in Singapore to manage all of the control business year, DRAM prices suddenly plunged and customers cut business projects through tie-ups with IT firms. The staff needed The number of Group companies outside Japan increased in outside Japan. Response centers were also established in back investments in semiconductors, putting Yokogawa’s for these projects were secured by restructuring the control the 1980s and Yokogawa products became better known for several countries to answer inquiries from customers 24/7 and measuring instruments and business. In addition, the company actively entered promising their excellent reliability. As a result, the number of orders for vigilantly monitor their control systems. Through these efforts, semiconductor tester businesses but challenging businesses. large projects was increasing outside Japan. However, non-Japan sales more than doubled in the five years starting in into the red. The profitability of the Yokogawa’s engineering system could not effectively handle 2002, and Yokogawa gained recognition as a global player in non-Japan control business also Bursting of the Dotcom Bubble and large projects in emerging and resource-rich countries. the control market. decreased, and demand in Japan Another Structural Reform Although Yokogawa’s customer-centered and quality-first In 2008, Yokogawa announced CENTUM VP as a platform contracted. With these approach was highly valued, our offices in individual to support VigilantPlant. This integrated production control unfavorable conditions, President In 2001, the situation took a turn for the worse due to countries were not up to the challenge of implementing system provides an environment that effectively integrates Kaihori’s first year saw higher developments in the US such as the bursting of the dotcom large-scale, long-term projects. Therefore, Yokogawa set up the control and information systems at the production site, sales but lower profits. the Global Engineering Solution Center (GESC) in Singapore and is the ultimate form of Yokogawa’s production control At this point, Yokogawa judged in 2001, to work with our engineering offices in India, China, system. that its business was at an Shuzo Kaihori and the Philippines. This system reduced costs and inflection point, because its cost improved the quality of projects by sharing the expertise and structure was making it difficult to remain price competitive, know-how available at each of these locations. and the control business was shifting from products to In the early 2000s, Yokogawa won an order for China’s solutions. Thus Yokogawa started improving its cost then-largest petrochemical complex project. This was the competitiveness and adding more value to engineering. first project in which Yokogawa served as the main In fiscal year 2008, business conditions took a turn for the automation contractor (MAC). Many employees from worse as a result of the global economic crises that followed different countries worked together to complete the project, events such as the collapse of Lehman Brothers, and the which was highly praised by the customer. This was one of sudden shrinking of the semiconductor market. Yokogawa’s Spectrum analyzer, a major product of Ando Electric the achievements of the GESC. 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 Roll out of Vigilance campaign affirming the company's commitment to determined that it had over-estimated the growth potential of its control business 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

President Uchida with Masao Motohashi (right), the then Ando president, Yokogawa won more orders for international large-scale projects as its Solutions. Yokogawa was also forced to solicit applications announcing Yokogawa's acquisition of Ando's stock business localized Announcing VigilantPlant, Yokogawa's vision for the ideal plant for a voluntary retirement program.

52 53 Yokogawa 100th Anniversary Yokogawa’s History —— Chapter 5 In fiscal year 2014, the non-Japan control business Innovation,’ Yokogawa creates new value with our clients for accounted for 72 percent of all sales. To continue growing a brighter future.” TF2017 is a three-year plan starting in Aiming to Become the Global globally, Yokogawa will need to be able to compete with fiscal year 2015. Over the next three years, Yokogawa will lay mega companies that are using their high profit, to the foundation for the growth required to achieve the goals aggressively invest in their businesses. Toward that end, of the long-term business framework. The company also No.1 in the Control Business Yokogawa will need to accelerate its growth strategy, decided to focus on the following three priorities: customers, strengthen cost competitiveness, and improve efficiency creating new value, and becoming a highly efficient global throughout the Group. As one such measure, the company company. (2011–) radically reviewed existing functions and operations, and Coincidentally, TF2017 was drawn up in 2015, which marks took the tough decision to rationalize human resources in the 100th anniversary of Yokogawa. A century ago, Japan. In fiscal year 2014, Yokogawa solicited applications Yokogawa started out with just four people. Currently, the for voluntary retirement from employees of the three Group operates globally, with 20,000 employees and offices companies engaged in the control business in Japan around the world. The founding principles that have been (Yokogawa Electric, Yokogawa Solution Service, and passed down through the generations – quality first, Yokogawa Manufacturing). pioneering spirit, and contribution to society – helped Announcing the Evolution 2015 In December 2012, Yokogawa acquired a minority interest Yokogawa develop highly reliable and quality products that Mid-term Business Plan in Soteica Visual MESA LLC, a US firm with advanced energy are the core of its business, excellent project execution management solutions (EMS), and began offering EMS capabilities, advanced knowledge in diverse industries and In 2011, several disasters and incidents struck the world services as part of its service solution lineup. engineering capabilities, and meticulous local service. economy, including the Great East Japan Earthquake, severe The control business did well with overseas projects, Yokogawa will never forget this. As a brave pioneer, we will flooding in Thailand, and the debt crisis in Europe. including a large LNG project in Australia and a second- anticipate changes, regard changes as opportunities, and Amidst this turmoil, Yokogawa announced its mid-term phase project for a world-class oil refining and act bravely, and will continue transforming ourselves in order business plan, Evolution 2015, in November 2011. This plan petrochemical plant in Saudi Arabia. to keep blazing new trails for another 100 years. set business targets for fiscal year 2015 and specific However, the control business in Japan faced challenging strategies to achieve them, and aimed to transform circumstances, and new investment in plants continued to Yokogawa into a global solutions and service company. This shrink. Customers started to shift focus from installing new plan was the first step towards the goal of becoming the equipment to increasing the added value of their existing global No.1 in the control business. facilities, by means such as making more effective use of The growth strategies for the control business were drawn energy by improving production efficiency, reducing costs, up from three aspects: region, industry, and product. The and making operations safer. As a solutions and service regional strategy was to concentrate management resources company, Yokogawa responded on resource-rich and emerging countries. The industry by bringing the sales, engineering, strategy was to expand business in oil refining and and service functions of the Japan CENTUM VP R6 announced in 2014 petrochemicals, where Yokogawa already had a large share control business under the of the market while continuing to focus on the upstream management of Yokogawa (exploration and production) sectors of the oil and gas Solution Service, which was Transformation 2017: the First Step industries, and on electric power and specialty chemicals. established for this purpose in towards the Next 100 Years The product strategy was to continue to develop highly April 2013. These three functions reliable products that help customers address business had formerly been handled by In accordance with the Evolution 2015 mid-term business issues, to capture the global top share with highly separate companies. In the same plan, Yokogawa worked hard to improve its profitability and competitive products such as differential pressure/pressure year, Yokogawa ushered in a new Takashi Nishijima finances by promoting growth strategies mainly in the transmitters, and to strengthen high value-added consulting generation of leadership with the control business, and it made progress in this latter respect services. Concurrently, Yokogawa built a production system appointment of Takashi Nishijima as president. thanks to the weak yen. Regarding profitability, in fiscal year President Nishijima briefing employees on Transformation 2017 suitable for global business, and globalized its headquarters 2014 Yokogawa was able to achieve the sales target for fiscal functions. Control Business Responds to Structural year 2015, one year ahead of schedule, and generated a Changes in Market record-high operating income. However, the increase in sales and operating income was largely due to the weaker Buoyed by energy-related demand in emerging and yen, and the improvement in profitability was far from resource-rich countries, the non-Japan control business satisfactory. Meanwhile, as a result of a global restructuring expanded, mainly in the oil, gas, and petrochemical of industries, Yokogawa’s business environment was industries. Starting in 2014, sales also were positively changing and new opportunities were emerging. impacted by the weak yen. In line with this, orders for Accordingly, Yokogawa had to rapidly transform its systems integration, advanced control, operation assistance, business structure, and so drew up a long-term business production management, security, and other types of framework that defines what kind of company sought solutions gradually increased. At the same time, Yokogawa Yokogawa will need to be 10 years from now, and specifies focused on the development of new products to enhance its strategies needed to achieve that goal. At the same time, solution capabilities and sales. without waiting for the completion of Evolution 2015, In Japan, as manufacturers accelerated their efforts to Yokogawa drew up a new mid-term business plan, restructure their businesses, Yokogawa strove to provide Transformation 2017, (TF2017) that covers fiscal years 2015 solutions that would make its customers' businesses more to 2017. Evacuation of company employees to the athletic field at the Tokyo headquarters following the Great East Japan earthquake efficient, but they could not compensate for the decrease in In this plan’s long-term business framework, Yokogawa the conventional control businesses. defined its vision statement, “Through ‘Process Co-

54 55 Data

Trend of sales and operating income

Sales (Billion yen) Operating income (Billion yen) 450 40 Sales (Million yen) Financial Periods 1~44 Operating income (Million yen) 90 4.5

80 4.0

375 70 3.5 30

60 3.0

50 2.5

300 40 2.0 20

30 1.5

20 1.0

225 10 5 10

0 0

21th 22th 23th 24th 25th 26th 5th-6th7th-8th 1st-2nd3rd-4th 9th-10th 11th-1213thth-1415thth-1617thth-1819thth-20th 27th-2829thth-3031thth-3233thth-3435thth-3637thth-3839thth-4041thth-4243thth-44th

150 0

75 (10)

0 (20)

Financial period 22th 1931.6.1-1932.5.31 23th 1932.6.1-1933.5.31 24th 1933.6.1-1934.5.31 25th 1934.6.1-1935.5.31 26th 1935.6.1-1936.5.31 45th 1945.6.1-1946.3.31 46th 1946.4.1-1946.8.10 101 th 1976.4.1-1977.3.31 102 th 1977.4.1-1978.3.31 103 th 1978.4.1-1979.3.31 104 th 1979.4.1-1980.3.31 105 th 1980.4.1-1981.3.31 106 th 1981.4.1-1982.3.31 107 th 1982.4.1-1983.3.31 108 th 1983.4.1-1984.3.31 109 th 1984.4.1-1985.3.31 110 th 1985.4.1-1986.3.31 111 th 1986.4.1-1987.3.31 112 th 1987.4.1-1988.3.31 113 th 1988.4.1-1989.3.31 114 th 1989.4.1-1990.3.31 115 th 1990.4.1-1991.3.31 116 th 1991.4.1-1992.3.31 117 th 1992.4.1-1993.3.31 118 th 1993.4.1-1994.3.31 119 th 1994.4.1-1995.3.31 120 th 1995.4.1-1996.3.31 121 th 1996.4.1-1997.3.31 122 th 1997.4.1-1998.3.31 123 th 1998.4.1-1999.3.31 124 th 1999.4.1-2000.3.31 125 th 2000.4.1-2001.3.31 126 th 2001.4.1-2002.3.31 127 th 2002.4.1-2003.3.31 128 th 2003.4.1-2004.3.31 129 th 2004.4.1-2005.3.31 130 th 2005.4.1-2006.3.31 131 th 2006.4.1-2007.3.31 132 th 2007.4.1-2008.3.31 133 th 2008.4.1-2009.3.31 134 th 2009.4.1-2010.3.31 135 th 2010.4.1-2011.3.31 136 th 2011.4.1-2012.3.31 137 th 2012.4.1-2013.3.31 138 th 2013.4.1-2014.3.31 139 th 2014.4.1-2015.3.31 21th 1930.12.1-1931.5.31 47th 1946.8.11-1949.9.30 48th 1949.10.1-1950.3.31 49th-50th 1950.4.1-1951.3.31 51th-52th 1951.4.1-1952.3.31 53th-54th 1952.4.1-1953.3.31 55th-56th 1953.4.1-1954.3.31 57th-58th 1954.4.1-1955.3.31 59th-60th 1955.4.1-1956.3.31 61th-62th 1956.4.1-1957.3.31 63th-64th 1957.4.1-1958.3.31 65th-66th 1958.4.1-1959.3.31 67th-68th 1959.4.1-1960.3.31 69th-70th 1960.4.1-1961.3.31 71th-72th 1961.4.1-1962.3.31 73th-74th 1962.4.1-1963.3.31 75th-76th 1963.4.1-1964.3.31 77th-78th 1964.4.1-1965.3.31 79th-80th 1965.4.1-1966.3.31 81th-82th 1966.4.1-1967.3.31 83th-84th 1967.4.1-1968.3.31 85th-86th 1968.4.1-1969.3.31 87 th -88 1969.4.1-1970.3.31 89 th -90 1970.4.1-1971.3.31 91 th -92 1971.4.1-1972.3.31 93 th -94 1972.4.1-1973.3.31 95 th -96 1973.4.1-1974.3.31 97 th -98 1974.4.1-1975.3.31 5th-6th 1922.12.1-1923.11.30 7th-8th 1923.12.1-1924.11.30 27th-28th 1936.6.1-1937.5.31 29th-30th 1937.6.1-1938.5.31 31th-32th 1938.6.1-1939.5.31 33th-34th 1939.6.1-1940.5.31 35th-36th 1940.6.1-1941.5.31 37th-38th 1941.6.1-1942.5.31 39th-40th 1942.6.1-1943.5.31 41th-42th 1943.6.1-1944.5.31 43th-44th 1944.6.1-1945.5.31 3rd-4th 1921.12.1-1922.11.30 3rd-4th 1st-2nd 1920.12.1-1921.11.30 99 th -100 1975.4.1-1976.3.31 9th-10th 1924.12.1-1925.11.30 11th-12th 1925.12.1-1926.11.30 13th-14th 1926.12.1-1927.11.30 15th-16th 1927.12.1-1928.11.30 17th-18th 1928.12.1-1929.11.30 19th-20th 1929.12.1-1930.11.30

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

56 57 Data

Trend of sales outside Japan Group companies

(Billion yen) (%) North America CIS 350 70 United States Russia Philippines Yokogawa Corporation of America Yokogawa Electric CIS Ltd. Yokogawa Philippines Inc. 300 60 Yokogawa USA, Inc. Yokogawa Electric Sakhalin Ltd. Thailand Yokogawa Nuclear Solutions, LLC Kazakhstan Yokogawa (Thailand) Ltd. Soteica Visual Mesa, LLC Yokogawa Electric Kazakhstan Ltd. 250 50 Vietnam Canada Ukraine Yokogawa Vietnam Company Ltd. Yokogawa Canada, Inc. Yokogawa Electric Ukraine Ltd. 200 40 India Mexico Yokogawa India Ltd. Yokogawa de Mexico, S.A. de C.V. Middle East Yokogawa IA Technologies India Private Yokogawa Engineering Services de Bahrain 150 30 Limited Mexico, S.A. de C.V. Yokogawa Middle East & Africa B.S.C. (c) China Yokogawa Engineering Bahrain SPC South America Yokogawa China Investment Co., Ltd. 100 20 Brazil Saudi Arabia Yokogawa China Co., Ltd. Yokogawa Saudi Arabia Ltd. Yokogawa America do Sul Ltda. Yokogawa Electric China Co., Ltd. Yokogawa Services Saudi Arabia Ltd. 50 10 Yokogawa Service Ltda. Yokogawa Sichuan Instrument Co., Ltd. Suzhou Yokogawa Meter Company Columbia United Arab Emirates Yokogawa Engineering Middle East & Yokogawa Shanghai Instrumentation Co., Yokogawa Colombia S.A.S. 0 0 Africa FZE Ltd. 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Yokogawa Shanghai Trading Co., Ltd. 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 (Fiscal year) Europe Africa Yokogawa Process Control (Shanghai) Sales outside Japan Sales ratio outside Japan Netherlands South Africa Co., Ltd. Yokogawa Europe B.V. Yokogawa South Africa (Pty) Ltd. Yokogawa Information Systems (Dalian) Yokogawa Europe Solutions B.V. Corporation Yokogawa Anglophone Africa Regions Yokogawa Europe Branches B.V. (Pty) Ltd. Yokogawa Software Engineering (WUXI) Co., Ltd. Yokogawa Process Analyzers Europe B.V. Nigeria Yokogawa System Integration & Sales by business segment Worldwide employees Yokogawa Africa Holding B.V. Yokogawa Services Solutions Nigeria Ltd. Procurement (WUXI) Co., Ltd. Austria Yokogawa Nigeria Ltd. Korea Yokogawa GesmbH, Central East Europe 5.9% Oceania Yokogawa Electric Korea Co., Ltd. Belgium Yokogawa Electronics Manufacturing % 5.9 Yokogawa Belgium N.V./S.A. Australia Korea Co., Ltd. Yokogawa Australia Pty. Ltd. 2,871 France Taiwan Yokogawa France S.A.S. New Zealand Yokogawa Taiwan Corp. Yokogawa New Zealand Ltd. Germany Group companies in Japan World wide Yokogawa Deutschland GmbH Sale for FY2014 Asia Yokogawa Solution Service Corporation Rota Yokogawa GmbH & Co. KG 4,058 billion yen 19,601 Singapore Yokogawa Meters & Instruments Corporation as of March31,2015 Hungary Yokogawa Electric International Pte. Ltd. Yokogawa Hungaria Kft. Yokogawa Engineering Asia Pte. Ltd. Omega Simulation Co., Ltd. YDC Corporation Italy Yokogawa Electric Asia Pte. Ltd. Plant Electrical Instrumentation Pte. Ltd. Yokogawa & Co., Ltd. 88.2% Yokogawa Italia S.r.l. Indonesia Yokogawa Denshikiki Co., Ltd. 11,590 5,140 Poland Yokogawa Foundry Corporation P.T. Yokogawa Indonesia Yokogawa Polska Sp. z o.o. Yokogawa Manufacturing Corporation P.T. Yokogawa Manufacturing Batam Spain Yokogawa Medical Solutions Corporation Malaysia Industrial automation and control Yokogawa Electric Cprporation Yokogawa Iberia S.A. Yokogawa Pionics Co., Ltd. Yokogawa Electric (Malaysia) Sdn. Bhd. Yokogawa Rental & Lease Corporation United Kingdom Yokogawa Kontrol (Malaysia) Sdn. Bhd. Test and measurement Group companies in Japan Yokogawa United Kingdom Limited Yokogawa Industrial Safety Systems Sdn. Yokogawa Marex Limited Bhd. Other Group compnaies outside Japan Yokogawa Analytical Solutions Sdn. Bhd. As of March 31, 2015

58 59 Always Reaching Higher —Yokogawa centennial booklet—

Yokogawa Electric Corporation Published in November 2015 ©2015 Yokogawa Electric Corporation