NTT DATA CORPORATION Annual Report 2018 Trusted Global Innovator ANNUAL REPORT 2018 Our Story of Long-Term Value Creation Pursuing Group Vision In these difficult-to-predict times, amid remarkable IT innovations and rapidly changing business models, we work closely with clients to combine an abundance of client ideas with global cutting-edge technologies that enable us to demonstrate our strengths. By doing so, we realize business innovation and resolve their issues. This also leads to the resolution of social issues as we aim to become a partner trusted by clients and society over the long term. Mission Statement NTT DATA uses information technology to create new paradigms and values, which help contribute to a more affluent and harmonious society. Group Vision Trusted Global Innovator 1 NTT DATA ANNUAL REPORT 2018 Advancing Values NTT DATA’s Values express the values we uphold in our quest to become a “Trusted Global Innovator,” which we have established as our Group Vision. We are united in sharing and inculcating these Values to realize corporate transformation. Clients First Foresight Teamwork Values and Their Significance Clients First Foresight Teamwork First, and above all else, we place the needs We never settle for the status quo. Instead, We put great importance on enabling our of our clients. We work continuously to with speed and foresight, we anticipate employees to achieve their best through understand your business and we strive to challenges that lay ahead. We consider the their work with each other. We believe that resolve every concern to your satisfaction. future of IT as well as the future of your when a diverse group of individuals brings Values We feel responsibility to ensure your business, work to enhance our ability to their unique world views together, shares success and we let this obligation set the picture the future, and with our ecosystems, their wisdom, and works toward a common direction of our work and guide our actions. adapt to the changing business environment. goal, the results are extraordinary and far In this way, we help you to meet your goals beyond what can be achieved by any and create a brighter future for society. one person. We will utilize internal and external By accurately forecasting long-term Utilizing human resources with diverse management resources that are best for technology trends in the field of IT, where values enables the creation of innovation our clients and work to provide optimal technology innovation is rapid, it becomes and the provision of optimal solutions. Significance IT services, which will eventually lead to possible to promote long-term, large-scale ensuring our long-term and stable earnings. projects and technology development. 1 Our Story of Long-Term Value Creation Leveraging Strengths The three strengths refined through the practical application of our Values are highly sustainable while at the same time difficult to imitate, leading to the long-term enhancement of NTT DATA’s corporate value. Committed to Delivering Excellence Technology Agnostic Applied Innovation Relationship between Strengths and Long-Term Enhancement of Corporate Value Committed to Delivering Excellence Technology Agnostic Applied Innovation We have taken part in a number of large-scale We maintain flexibility by not relying on We have sophisticated development and system development and operation projects specific hardware and software products and operation methods that are globally consistent, to date, including national projects. Through respond to the demand for advanced along with highly specialized human resources development and stable operation, we have services. to implement them. We have also refined Strengths established a robust customer base and built software development automation and other up trust. production technologies. Through Long-Term Relationships with We provide advanced services in a flexible By applying production technologies and How Each Strength clients built on deep understanding, we manner and work with clients to offer R&D excellence, including R&D that Relates to are able to precisely reflect client needs applied innovation, fostering increases in leverages the NTT Group’s capabilities, we Long-Term and make high-value-added proposals that client satisfaction. contribute to business transformation that Enhancement only NTT DATA can provide. are optimal for customers, as well as of Corporate increased productivity. Value 2 3 NTT DATA ANNUAL REPORT 2018 Positioning of NTT DATA to Maximize Our Strengths We persist on being a multi-vendor that is not reliant on specific hardware and software products to maintain our flexibility and pursue advanced and innovative technologies so that: • In addition to NTT DATA’s advanced solutions, by engaging in partnerships with players of various product and service domains, we are able to incorporate a wide range of advanced products and technologies and provide solutions that are optimal for clients. • Amid ongoing business transformations in a variety of industries, we respond to market and client changes and capture business opportunities in a wide range of domains, enabling the co-innovation of new business models with clients using IT. • We are able to develop social infrastructure systems requiring the consolidation of numerous vendors and cross-industrial businesses. • Alliances with other companies enable us to avoid needless investment, improving investment efficiency and reducing risk. NTT DATA Positioning Image Clients Provision of optimal IT solutions (Using NTT DATA’s own resources and providing them in an integrated manner) Global Top Companies as Sler Committed to Technology Applied Strengths Delivering System Integrator Players Agnostic Innovation · IBM Excellence · Accenture · Deloitte System development and overall integration · DXC (utilizing the strengths of outside partners) · PwC · Fujitsu Software Hardware Programming Network Players Players Players Players · Microsoft · Fujitsu · Produced by Sler · NTT Communications, · Oracle · NEC · System companies, etc. · SAP, etc. · Hitachi, etc. etc. Clients First 3 Our Story of Long-Term Value Creation Our Way of Value Creation Using our refined strengths to resolve client issues will contribute to a more affluent and harmonious society and enhance corporate value. This is the very embodiment of our mission statement. ESG Business activities that Group Vision take into consideration the Public sector environment, society, Trusted and governance Energy and utilities Global Innovator Telecommunications Values Healthcare Clients First Co-Innovation Banking and financial services Foresight Value Co-Innovation Model Clients Insurance Flexibly providing optimized Teamwork Manufacturing solutions in response to client issues Strengths Retail Consulting Wholesale and distribution Committed to System Development Delivering Outsourcing Excellence Service industry Technology Long-Term Transportation and logistics Agnostic Relationships Education Applied Innovation Media Capital Usage Non-Financial Capital Financial Capital Human Resources and Fiscal 2017 Client Base Organizational Technologies Brand Partners Capabilities Consolidated • Number of clients with • Employees working • Named by IDC as a • Global IT service ranking • Global Services Net Sales ¥5.0 billion or more (in overseas “company with a strong (Net sales) Partnership concluded (JGAAP) Japan), or US$50 million Apporox. 70% image as a provider of big 8th with SAP SE or more (outside Japan), in data solutions” among IT NTT DATA Group the first annual IT spend (net sales) • Employees vendors in Japan, and as a • CMMI certification Asian company to be an ¥2,117.1 billion 65 clients More than 118,000 top-tier system integrator*1 Level 5 (the highest level) SAP service partner (IFRS: ¥2,039.7 billion) • Worldwide offshore and • Positioned as a Leader in • Number of companies near-shore development Avasant’s Blockchain certified under the personnel Services RadarViewTM business partner system*2 More than 35,000 157 Operating Income • Received the Fiscal 2017 • SAP consultants PM Application Award from (JGAAP) More than 10,000 the Society of Project Management ¥123.5 billion (IFRS: ¥123.1 billion) *1 Source: “2017 Trends in the Domestic Big Data Solutions Market,” December 2017, IDC Japan (JPJ41767217) *2 A certification system NTT DATA employs to build positive relationships with external suppliers 4 5 NTT DATA ANNUAL REPORT 2018 Client Issues Social Issues Global development Realizing a more Response to increasingly affluent and sophisticated economic activities harmonious society Realization of smart Realizing a social foundation communities with convenience, safety, and reliability Creation of new products Public sector and services Creating sustainable cities and regions Energy and utilities Reliable and convenient infrastructure development Lowering environmental Telecommunications burdens Lower electric power and Healthcare energy consumption Developing infrastructure to Banking and financial services Creating New prevent disasters and respond to natural disasters Insurance Paradigms and Manufacturing Value with Provision of high-quality Ensuring stable and efficient Retail medical services Information Technology energy provision Wholesale and distribution Lower paper consumption Realizing society of health Service industry Ensuring cybersecurity and longevity Transportation and logistics Client needs analysis Eliminating labor shortages Education Support for workstyle innovations Media