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MHI to Launch "Shared Technology Framework" Under Oversight of CTO

Tidal Energy
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- Engineering Headquarters and Two Other Entities to be Newly Added, Enhancing Response Capability to Business Scale Expansion -

Effective April 1 Mitsubishi Heavy Industries, Ltd. (MHI) will launch a new "shared technology framework" consolidating the Company's technologies as well as marketing, procurement and other functions. The new framework, which will be overseen by the Chief Technology Officer (CTO), will encompass three new entities - Engineering Headquarters, Marketing & Innovation Headquarters, and Value Chain Headquarters - and the existing ICT Solution Headquarters and Research & Innovation Center. The organizational change has a number of aims: to expand the scope of the CTO's authority and responsibilities; to strengthen the Company's technology infrastructure and marketing capability; to optimize procurement and other aspects of the value chain; and to fortify MHI's medium to long-term corporate and business competitiveness.

The new Engineering Headquarters will bring together the functions currently performed by the Energy & Environment domain's Chemical Plant & Infrastructure Division and the EPC (engineering, procurement and construction) functions of the Commercial Aviation & Transportation Systems domain's Engineering Division. The new entity will get under way with a staff of approximately 750. Human resources will be optimally utilized from a Companywide perspective spanning across a broad array of business areas including chemical plants, transportation systems and cruise ships. Measures will be taken to enhance the level and efficiency of EPC functions.

The new Marketing & Innovation Headquarters will be formed from the Global Business Planning & Operations Headquarters' Global Business Innovation Department and Corporation Business Department and the Oil & Gas Business Development Department, which is directly overseen by the President/CEO. The new entity will launch with some 50 staff members. Its activities will include preparing business models, business strategies and technology strategies applying internal and external expertise, intelligence and innovation activities such as product service planning and other hypothesis creation, verification of product servicing business feasibility through market and user research, and account management activities including learning customers' one-stop needs.

The new Value Chain Headquarters will integrate the Technology & Innovation Headquarters' Monozukuri Innovation Planning Department and Applied Knowledge Business Training Center, part of the Procurement & Sourcing Department, and the Machinery, Equipment & Infrastructure domain's Foundry Center. Operations will get under way with approximately 200 employees. The new Headquarters' task will be to strengthen the Company's global competitiveness primarily through higher production efficiency and enhanced supply chain management (SCM), to come from procurement methods optimized from the standpoint of manufacturing efficiency and comprehensive equipment planning encompassing upstream to downstream needs.

In recent years MHI has implemented a number of organizational and operational reforms in its quest to grow as a global corporation. These include the introduction of systems of business domains and chief officers, the launch and thorough execution of a system based on strategic business evaluations, and reorganization of the Company's R&D structure in tandem with the creation of the Research & Innovation Center. With the start of the new shared technology framework the entire MHI Group will now serve to support the Company's core technological base, contributing to strengthening of technology innovation and response to new business opportunities as a way of driving corporate development over the medium to long term.