LXXXI Asamblea Nacional

“La Globalización: Retos y oportunidades”

Michael S. Inoue, Ph.D.Presidente, Sociedad Japonesa de San Diego y Tijuana (JSSDT)

Senior Advisor, Kyocera International, Inc. (KII)A Former Professor, Oregon State University

México Japón E. U. A.

Objetivo #1

• Identificar las oportunidades, los retos y las amenazas que la globalización plantea en particular a los empresarios (Kyocera Mexicana, SA de CV) y en general para el desarrollo de México (y Japón).

Objetivo #2

• Urgir a los responsables de las decisiones nacionales, a los políticos y en general a los mexicanos (japonés) a que unamos esfuerzos en pro de la competitividad como una fórmula indispensable para afrontar los retos y amenazas que plantea la globalización.

Objetivo #3

• Proponer a la sociedad puntos de consenso indispensable en México (Japón y Kyocera) para hacer posible el incremento de la competitividad y en consecuencia abatir la pobreza en un mundo crecientemente globalizado.

Objetivo #4

• Llamar a los empresarios mexicanos (Kyocera) para que se unan a los que ya están en Coparmex (e.g. JETRO) en la búsqueda de la economía competitiva y socialmente responsable que necesita el país (Japón) frente a la globalización.

¿Qué es precisamente la globalización? (Case of Japan)

1549 Francisco de Javier 8/15/1549; a Mexican missionary included in 26 Martyrs of Nagasaki (2/5/1597)

1650 Isolation

1817 Commodore Matthew Perry visits Japan

1882 Japanese Navy visits San Diego, Acapulco

1900 Colonialization (Manchuria, Korea, Taiwan, …)

1940 Militarism

1945 End of WWII; survival (imitations); Protectionism

1959 Economic boom; Acquisition of foreign companies

1998 Bubble bursts

¿Qué es precisamente la globalización?

Stage 0 Isolation and Protectionism

Stage 1 Regional and inter-state commerce

Stage 2 Colonialization (Foreign capital, technology)

Stage 3 Bilateral commerce

Stage 4 International companies

Local production by foreign subsidiaries

Stage 5 Multinational corporation

Local R&D, product design

Stage 6 Global corporation

A group of multinational companies

¿Qué es precisamente la globalización? (Case of Kyocera)

1959 Dr. Kazuo Inamori establishes Kyocera in Kyoto with 27 employees, US$10,000 in capital. Sales: $5K/mos.

1965 Texas Instruments (‘65), IBM(‘66) place orders.

1969 Kyocera International, Inc. established in Sunnyvale, CA.

1972 KII Production in San Diego, (1st Japanese Mfg in CA)

1976 ADR listed on NYSE

1984 Established KDDI (then DDI)

1990 Merged AVX, the first stock swap merger of a Japanese company with a foreign company

1995 20% listed AVX on NYSE $1B sales, Profit grew x5

2000 Established Kyocera Wireless Corp.(from QUALCOMM)

Introducing Kyocera Corporation (1)Introducing Kyocera Corporation (1) FoundedFounded :: April 1959April 1959

HeadquartersHeadquarters :: Kyoto, JapanKyoto, Japan

FY00 SalesFY00 Sales : : 1.285 Trillion Yen (about $10.2 1.285 Trillion Yen (about $10.2 Billion) Billion)

General FactsGeneral Facts :: >80% of sales derived from >80% of sales derived from telecom, information processing telecom, information processing

and Internet-related and Internet-related businessesbusinesses

Leading ProductsLeading Products :: Telecom & information equipment Telecom & information equipment (wireless phones, copiers, (wireless phones, copiers,

printers, printers, faxes); advanced faxes); advanced ceramics; ceramics; electronic electronic components; components; semiconductor packages; semiconductor packages;

solar power systems; camerassolar power systems; cameras

Introducing Kyocera CorporationIntroducing Kyocera Corporation (2) (2) Workforce:Workforce: Approximately 42,000 worldwideApproximately 42,000 worldwide

Research and Development Centers:Research and Development Centers:Central Research Center, KagoshimaCentral Research Center, KagoshimaYokohama Research Center, YokohamaYokohama Research Center, YokohamaKeihanna Research Center, KyotoKeihanna Research Center, KyotoKyocera Mita R&D Center, OsakaKyocera Mita R&D Center, OsakaAdvanced Ceramics Technology Center, Vancouver, WA, U.S.A.Advanced Ceramics Technology Center, Vancouver, WA, U.S.A.Advanced Products Technical Center, Myrtle Beach, SC, U.S.A.Advanced Products Technical Center, Myrtle Beach, SC, U.S.A.Israel Research Center, Jerusalem, IsraelIsrael Research Center, Jerusalem, Israel

Manufacturing Plants:Manufacturing Plants: 6161 Japan:Japan: 1818 ROW:ROW: 4343

Named by Named by IndustryWeekIndustryWeek among “The World’s 100 Best-Managed Companies” among “The World’s 100 Best-Managed Companies”

Strategic Market DirectionsStrategic Market Directions

Fine Ceramic Group Share of Kyocera Group’s FY01 Net Sales: 28.3%

FY01 sales: FY01 sales: ¥363 billion¥363 billion ($2.881 billion)($2.881 billion) up 34.0%up 34.0%

Fine Ceramic PartsFine Ceramic Parts Semiconductor PartsSemiconductor Parts Consumer-related ProductsConsumer-related Products

Electronic Device Group Share of Kyocera Group’s FY01 Net Sales: 30.6%

FY01 sales:FY01 sales: ¥393 billion¥393 billion($3.116 ($3.116

billion)billion)up 46.6%up 46.6%

Electronic ComponentsElectronic Components

FY01 sales: ¥467 billion ($3.709 billion)

up 117.3%

Telecommunications Equipment

Information Equipment

Optical Instruments

Equipment GroupShare of Kyocera Group’s FY01 Net Sales: 36.3%

Business Segment Information

30.6%

36.3%Telcom Info

Optical

34.0%Semi

ConsumerFine Cer

March 2001 % ChangeBusiness Segment

Amount%to Net

Sales +/-

Fine ceramic-related business 363,026 28.3% 34.0%Fine ceramic parts 104,765 8.2% 45.8%Semiconductor parts 197,103 15.3% 39.4%Consumer-related products 61,158 4.8% 5.9%

This segment’s revenue rose significantly. The greatestgrowth occurred in sale of electronic surface-mountdevice (SMD) packages for mobile communicationshandsets; semiconductor parts for optoelectronicdevices; fine ceramic parts, including ferrules andisolators, for fiber-optic networks. Steady expansion insales of consumer-related products, such as solar energysystems, cutting tools, and jewelry.

Electronic devices-related business 392,700 30.6% 46.6% Sales of components for the telecommunications andinformation processing industries showed very strongdespite a slowing toward the end of the second half.Increased sales of Kyocera and AVX Corporation, a U.S.subsidiary were seen in ceramic and tantalum capacitors;timing devices, such as temperature-compensatedcrystal oscillators (TCXOs) and connectors of KyoceraElco Corporation, a Japanese subsidiary.

Equipment-related business 467,362 36.3% 117.3%Telecommunications equipment 273,519 21.2% 112.3%Information equipment 160,175 12.5% 239.6%Optical Instruments 33,668 2.6% -13.9%

Because this fiscal year included a full 12 months ofsales from two new subsidiaries engaged in theequipment business (KWC and Kyocera Mita), thecompany’s total revenue from information andtelecommunications equipment rose substantially.Outside Japan, the Company achieved stronger sales ofPHS-related products, such as base stations andhandsets.

THE AMERICASTHE AMERICAS 20 Manufacturing 20 Manufacturing PlantsPlants San Diego, CASan Diego, CA CDMA wireless phonesCDMA wireless phones San Diego, CASan Diego, CA Semiconductor packagesSemiconductor packages Beaverton, ORBeaverton, OR Semiconductor packagesSemiconductor packages Mountain Home, NCMountain Home, NC Structural ceramic partsStructural ceramic parts Vancouver, WAVancouver, WA Structural ceramic partsStructural ceramic parts Scottsdale, AZScottsdale, AZ Solar energy productsSolar energy products Irvine, CAIrvine, CA Carbide Cutting ToolsCarbide Cutting Tools Biddeford, ME (AVX)Biddeford, ME (AVX) Electronic componentsElectronic components Colorado Springs, CO (AVX)Colorado Springs, CO (AVX) Electronic componentsElectronic components Conway, SC (AVX)Conway, SC (AVX) Electronic componentsElectronic components Myrtle Beach, SC (AVX)Myrtle Beach, SC (AVX) Electronic componentsElectronic components Raleigh, NC (AVX)Raleigh, NC (AVX) Electronic componentsElectronic components Olean, NY (AVX)Olean, NY (AVX) Electronic componentsElectronic components Sun Valley, CA (AVX)Sun Valley, CA (AVX) Electronic componentsElectronic components Tijuana, Mexico Tijuana, Mexico Semiconductor packagesSemiconductor packages Chihuahua, Mexico (AVX)Chihuahua, Mexico (AVX) Electronic componentsElectronic components Juarez, Mexico (AVX)Juarez, Mexico (AVX) Electronic componentsElectronic components San Salvador, El Salvador (AVX)San Salvador, El Salvador (AVX) Electronic componentsElectronic components Sao Paulo, BrazilSao Paulo, Brazil Optical instrumentsOptical instruments Manaus, Brazil (AVX)Manaus, Brazil (AVX) Electronic ComponentsElectronic Components Provincia de Buenos Aires, ArgentinaProvincia de Buenos Aires, Argentina Solar energy productsSolar energy products

Global ManufacturingGlobal Manufacturing

Global ManufacturingGlobal Manufacturing JAPANJAPAN 18 Manufacturing Plants18 Manufacturing Plants

Hokkaido KitamiHokkaido Kitami Optical ceramics, telecom equipment,Optical ceramics, telecom equipment, electronic componentselectronic components

Fukushima TanaguraFukushima Tanagura Telecom equipmentTelecom equipment Chiba SakuraChiba Sakura Solar systemsSolar systems Nagano OkayaNagano Okaya Optical instruments, electronic componentsOptical instruments, electronic components Tokyo OhmeTokyo Ohme Optical lensesOptical lenses Mie IseMie Ise Solar power systemsSolar power systems Mie TamakiMie Tamaki Laser printersLaser printers ShigaShiga Semiconductor packages, electronic components,Semiconductor packages, electronic components,

structural ceramic components, solar productsstructural ceramic components, solar products Kagoshima SendaiKagoshima Sendai Semiconductor packages, electronic components,Semiconductor packages, electronic components,

structural ceramic partsstructural ceramic parts Kagoshima KokubuKagoshima Kokubu Semiconductor packages, electronic components,Semiconductor packages, electronic components,

structural ceramic partsstructural ceramic parts Kagoshima HayatoKagoshima Hayato Electronic componentsElectronic components Kyocera Elco Corp.Kyocera Elco Corp. Electronic connectorsElectronic connectors Kyocera Optec Co. Ltd.Kyocera Optec Co. Ltd. Optical instrumentsOptical instruments Kyocera MitaKyocera Mita (5 plants) (5 plants) Copiers and facsimile equipmentCopiers and facsimile equipment

EUROPE / MIDDLE EAST EUROPE / MIDDLE EAST 12 Manufacturing 12 Manufacturing

PlantsPlants Paignton, England (AVX)Paignton, England (AVX) Electronic componentsElectronic components Newmarket, England (AVX)Newmarket, England (AVX) Electronic componentsElectronic components Biggleswade, England (AVX)Biggleswade, England (AVX) Electronic componentsElectronic components Coleraine, N. Ireland (AVX)Coleraine, N. Ireland (AVX) Electronic componentsElectronic components Larne, N. Ireland (AVX)Larne, N. Ireland (AVX) Electronic componentsElectronic components Betzdorf, Germany (AVX)Betzdorf, Germany (AVX) Electronic componentsElectronic components Seurre, France (AVX)Seurre, France (AVX) Electronic componentsElectronic components Beaune, France (AVX)Beaune, France (AVX) Electronic componentsElectronic components Saint Appolinaire, France (AVX)Saint Appolinaire, France (AVX) Electronic componentsElectronic components Lanskroun, Czech Rep. (AVX)Lanskroun, Czech Rep. (AVX) Electronic componentsElectronic components Uherske Hradiste, Czech Rep. (AVX)Uherske Hradiste, Czech Rep. (AVX) Electronic componentsElectronic components Jerusalem, Israel (AVX)Jerusalem, Israel (AVX) Electronic componentsElectronic components

Global ManufacturingGlobal Manufacturing

PRODUCT / SERVICEPRODUCT / SERVICETelecommunications common carrierTelecommunications common carrierMobile and portable telephone servicesMobile and portable telephone servicesPHS communication servicesPHS communication servicesAmusement and leisureAmusement and leisureMultimedia servicesMultimedia servicesLeasing servicesLeasing servicesTelecom & information systems servicesTelecom & information systems servicesElectronic ComponentsElectronic ComponentsElectronics ConnectorsElectronics ConnectorsCDMA wireless phonesCDMA wireless phonesCDMA wireless phonesCDMA wireless phonesCopiers, faxesCopiers, faxesElectronic componentsElectronic components

COMPANYCOMPANYDDI CorporationDDI Corporation

Cellular Telephone CompaniesCellular Telephone CompaniesDDI Pocket Telephone CompaniesDDI Pocket Telephone Companies

Taito CorporationTaito CorporationKyocera Multimedia CorporationKyocera Multimedia Corporation

Kyocera Leasing Co., Ltd.Kyocera Leasing Co., Ltd.Kyocera Communication Systems Co., Ltd.Kyocera Communication Systems Co., Ltd.

Kinseki, Ltd.Kinseki, Ltd.Kyocera Elco CorporationKyocera Elco Corporation

Kyocera Wireless Corp.Kyocera Wireless Corp.S.K. Teletech Co., Ltd.S.K. Teletech Co., Ltd.

Kyocera Mita Corp.Kyocera Mita Corp.AVX CorporationAVX Corporation

Major Operating Subsidiaries and Affiliates

Crea-

tividad

Auto

Estima

Pertenencia

Segridad

Necesidades Fisiológicas

Triángulo de Braham H. Maslow (1908-1970)

sobre las necessidades humanas(Inoue, Murray y Blanco, p.28)

Arts,

sciences

Sovereignty

Autonomy

Education, social development

Security (Laws and Order)

Food, Clothing, Shelter, Energy

National Development

Co.

Morality

Mission

Co. Structure

Inspired Leadership

Dedicated Workforce

Safety, security, compensations

Maslow’s Triangle for a Global Corporation

“Respect the Divine Co.And Love People” Motto

Philosophy Kyocera Philosophy

Amoebas Co. Structure Inspired Leadership “Formula for

Dedicated Workforce Success”

Safety, security, profit, compensations

Maslow’s Triangle for Kyocera

Tech-

nology

Logistics

Infrastructure

Quality labor cost

Prospect for profitability,

Safety, security, water, food, housing

Maslow’s Triangle for a Corporate Location

Kyocera Formula for Success

The Result of our work

Or of our life

=

Ability (0~100%)

x

Effort (0~100%)

X

Attitude (-100%~100%)

Kyocera Philosophy

P.A.S.S.I.O.N.Dr. Kazuo Inamori, Founder Kyocera & KDDI• Purpose/Profit

• Ambition

• Sincerity

• Strength

• Innovation

• Optimism

• Never Give Up

Global Prosperity and HappinessMexico, Japan and EUA can lead the world

Kyocera CorporationKyocera Corporation

Consolidated

BUSINESS OVERVIEW

For the year ended March 31, 2001

1. Introducing Kyocera Corporation1. Introducing Kyocera Corporation2. Strategic Market Directions 2. Strategic Market Directions 3. Business Segment Information3. Business Segment Information4. Global Manufacturing 4. Global Manufacturing 5. Organization5. Organization6. The “Inamori Group”6. The “Inamori Group”7. North American Operations7. North American Operations8. Fiscal 2000 Sales by Product Line8. Fiscal 2000 Sales by Product Line9. Major Operating Subsidiaries & Affiliates9. Major Operating Subsidiaries & Affiliates

Presentation OutlinePresentation Outline

Telecommunication Environment Quality of Life

Products for

Kyocera Strategy