Good morning, and thank you very much for coming over to this venue, and also those of you online, thank you very much for viewing and attending today. I would like to start our meeting today. First of all, just briefly, I'd like to introduce myself. Starting from April this year, I became CRO of Fujitsu, Chief Revenue Officer, and at the same time, I'm serving as the head of Global Customer Success Business Group. Personally, in August 2019, I joined Fujitsu, and after that, mainly I was in charge of the customers in manufacturing industry. Yesterday, Japan Global Gateway was discussed, and I helped the launch of JGG and sustainable manufacturing for the customers and the manufacturing success. That's what I supported.
Since Global Customer Success Business Group was established in 2022, involving the manufacturing, retail, and the financial services customer. Since then, I became the head of our Global Customer Success Business Group. Last week, we announced the new midterm management plan and what we would like to achieve towards 2030, and also to realize the success for focus areas. That's what we announced. The content of my talk is how to bring this customer success strategy into the implementation on the global scale with consistency. With the existing or the old global structure, there was a region and the delivery collaboration, but it was done separately and individually, deal by deal manner.
For those global customers operating globally, the consistent service offering was difficult with the old structure, and that was the issue that we faced. Starting from this year, I became the CRO, Chief Revenue Officer, as you see, the roles and responsibilities of a CRO. I have the responsibility to develop and maximize the revenue for Fujitsu. Without worrying about the industry differentiation and segment differentiation, I need to take a comprehensive approach in order to maximize the revenue, as you see on the right-hand side. Starting from this year, and as a CRO, to regions and to the BUs, we are promoting the Fujitsu Uvance and the SAP, Microsoft, and other strategic partners.
We need to promote the go-to-market on a global fashion, that the growth of Fujitsu as a whole and also the expansion in a consistent manner is to be realized. These are the key strategies and measures. As for customer strategy, unified, consistent strategy and approach is needed. Global standardization of account portfolio is the key. This is what we reviewed. As for pricing, conventionally, the price was set based upon the buildup of the cost, but the more on the focus and prioritized on the pricing approach based upon value is to be pursued. As for organization, as I mentioned, as CRO, the interregional collaboration is what I support, and the regional alignment with our Uvance shall be promoted flexibly.
As for operation, multi-region account management structure is to be established, and the expand digital sales with technology and the resources. I will give you more detailed explanation later. But the in order to compete globally, Global Account Director or GAD. This is a new model that we introduced. We are trying to develop this GAD. Not just internal resources. From a global market, proactively, we are to capture the talent from the global markets. The partner strategy, SAP, ServiceNow, Salesforce, Microsoft, and AWS, together with them, go-to-market strategy is being discussed with the leading teams of the strategic partners on a global scale.
As I mentioned earlier, this is a detailed explanation about what I mentioned, to those customers that are operating globally, how shall we work with them and support them? This is what this slide explains. Multi-region account management structure is to be established. This operation model is to be promoted. To be more specific, to globally operating customers in all regions and all the business and the areas, our representative global account director, GAD, is to be nominated. Within the team, well, to expand and provide support to the customers' expansion and to they provide a solution to the social issues, we are going to work closely with the customers. With the conventional model to the same customer, the regional alignment was rather limited in the past.
Regionally, and also with the Fujitsu head office side, the teams worked differently towards, and independently towards the customers. There is no border when it comes to globally operating customers, we need to have a more one-on-one relationship. In order to improve upon this, the dedicated manager assigned to the customer shall be introduced, and they are called AGM, Account General Manager, placed under GAD. GAD has the overall responsibility for all the regions and all the businesses. Under GAD, there are AGMs. The customer headquarters and in each of the regions, globally consistent service can be offered, the global offering, like the Uvance, will be possible based upon this structure. This concludes my presentation. Thank you very much for your attention. Next, Tsumi-san, over to you.
Good morning, everyone. My name is Tsumi. I'd like to talk about the regional strategy, about Japan, specifically. First of all, please allow me to introduce myself. In April last year, I joined Fujitsu. Right now, I am responsible for a Japan region as the CEO. Before that, I worked for Philips Japan as CEO and Royal Philips, Senior Vice President for the medical transformation, especially from the information perspective. Before that, I worked for Samsung Electronics, Japan CEO and Samsung headquarters, EVP as well. I was involved in the device and the terminal stations. Before that, I was a Vice President for Cisco Systems, for the interinformation network and infrastructure and the network in Asia. First out of college, I joined NEC.
At NEC, I was involved in international business, and I was stationed in U.S. for six years, and also I served as a secretary to president for six years as well. In that sense, U.S., Japan, and Asia and Europe, I have been experiencing global management. Also in Fujitsu, for the future innovation, I hope to drive and promote the future innovation going forward. Let us reflect from 2020 to 2022. Those are three years in the past. What we have been working on in Japan, you see four boxes here. The first one is the full scale start of Fujitsu Japan.
In October 2020, it started. From April 2021, it started in a full-fledged way. The domestic front line was strengthened to establish overwhelming position in the Japanese market and to increase the profitability in the regional Japanese market as we speak. The second one is reorganize SI group companies. The fragmented expertise and the strengths are to be consolidated, to bring them together. That's what we've been working on to improve earnings power through the new system integration organization. I think we're able to strengthen actions in that end. The third point, transformation of the business producers. For this 8,000 salespeople, we conducted a reskilling training. The consultation capabilities have been strengthened so that we can promote the collaboration with the customers on the DX.
Last but not least, the fourth one, the establishment of Ridgelinez. This is as a transformation partner to strengthen our ability to handle the upstream processes, to support the customer's transformation, and to continue a disruptive future, to improve the quality of the business deals. To generate the businesses that are really fundamentally the core on the, from the customer side. As we have been working on this, based on what we've done so far, what are we going to do going forward? This is the current status of Japan region on the right-hand side of this page. You see our current positioning. In each segment, in each industry segment, we are maintaining a top-tier position in Japan. We have a very strong customer base. With that as a base, what are we going to drive growth going forward?
I'll come back to that later on. If I may draw your attention to enterprise, manufacturing, retail, and distribution, and finance. From the global major players all the way to, the regional medium-sized companies, we are providing, support to the every single corner of Japan, and also providing a wide range of services from the application of global solutions to individual system integration. Furthermore, we provide a wide range of support for manufacturing, retail, and distribution, and finance companies, regardless of the industry sector. Of course, it's not sufficient. There is still a wide space. To secure the productivity, we have to further strengthen the productivity. With the measures that I'll be extending going forward, we'd like to strengthen those areas as well.
On the other hand, in the public sector, for a long time, we've been supporting to build the public infrastructure system, and we are operating them, and we are supporting mission-critical operations with high quality and high level of technical capabilities. Furthermore, the modernization, which has become a boom, and I will elaborate further about this, but we're driving the modernization. In the healthcare area, we have a very high share in the electronic medical records area. With that, I would like to build the Uvance areas even further. Japan region, DX is not necessarily in the front line. Compared to other countries, Japan may be behind when it comes to DX. That means that there is still a potential. By leveraging our strengths, we would like to drive further growth. The targets for 2025 and actions towards that.
In a nutshell, as you can see in this chart, fiscal 2025, JPY 1.45 trillion of sales, operating profit margin 19.3%, that's what we are targeting, that's what we're trying to achieve. When show you these numbers, you may wonder, "Can we really achieve this?" This is a possible target that we should go for. I'll give you more details later, the details are on the right-hand side, the five key points. Three in expanding revenues, two, excuse me, three in improving productivity, one is overlapping, one of the core pillar is Uvance. JPY 210 billion is the target for 2025. The second pillar is the modernization, JPY 250 billion of revenue in 2025.
With the transformation of the frontline, there are three key points. The first one is the consultation, the approach to strengthen the consultation. The second point here is the digital sales, offering sales. The third point is engagement with partners, and measures by strengthening the coverage. The fourth one is optimizing development. Yesterday, Ashimoto-san talked about the gross margin, now 1%, the growth per year was mentioned. As a frontline, how can we drive this? How can we lead this? I'll elaborate on this later on. Last but not least, the strengthening of the quality management. This is a very important portion in improving the productivity as well. Customers' needs are based on the needs and attributes of the customers. The frontline approach will be fundamentally transformed and strengthened.
With that, in fiscal 2025, we should be able to achieve these targets and will be strengthening actions towards that end. Those five points that I just introduced, let me elaborate further. First of all, the Uvance is the first point on expanding revenue. On this, yesterday, Takahashi-san already covered this, but 40% of the sales in 2025 should come from international. JPY 700 billion was mentioned by Takahashi-san yesterday. In other words, in Japan, that's JPY 420 billion in 2025 that we have to achieve. Out of that, JPY 210 billion shall be led by us in the frontline. As a matter of fact, with the existing pipeline, when we say pipeline, it's not the revenue, it's the visibility. What kind of projects do we have in the pipeline?
By looking at the current pipeline, horizontal, JPY 300 billion, vertical, JPY 200 billion. We do have such a big pipeline. Two years since Uvance started, especially in vertical, JPY 200 billion, this figure, it might still not be sufficient, but at least we've been able to bring to where we are in two years. Going forward with modernization and with the Uvance, various schemes up and running, we should be able to strengthen and expand the pipeline even further for sure. As a frontline, I will be leading and driving the Uvance business, and I'll give you some case examples towards the end of my presentation. The second pillar is a modernization. In Fujitsu, we have the customers using our mainframe UNIX, so we have a lot of customers who use our mainframe UNIX.
We have to make sure to drive them to the modernization. That's our mission, to guide our customers to modernization. The Modernization Knowledge Center, which was explained yesterday, with the accumulated knowledge and including other companies' areas, this is really an aggressive modernization that we'd like to roll out. Modernization in 2025, JPY 250 billion is the plan. As a matter of fact, already, modernization has started. As you can see on the right-hand side, these are the orders case, starting with the central government and the carrier companies and financial institutions, electronic manufacturers, the food manufacturers, and pharmaceutical companies. The actual modernization projects have already kicked off. Customers' attention to modernization is getting higher and higher, especially after COVID-19, post-COVID.
Looking towards 2025, various movements and BCP measures against security, based on those perspectives, modernization trend will be further accelerated. Let me talk about the front transformation, the third point. Expanding revenue and improving productivity, this point, transforming our method of sales, actually, applies to both in three key points: consulting approach, offering sales, digital sales, and engagement with partners. Here, based on the needs and attributes of the customers, Fujitsu's value shall be recognized. For those customers to recognize our values, we will strengthen our frontline approach in a very progressive way. Let me give you some specific measures. The first one is the consulting approach, together with Ridgelinez, by taking leveraging Ridgelinez. Already, this is something that we can introduce as a case example of a certain electronic manufacturer.
As a business transformation program management, with the consensus of the top management and alignment, including explanation of a project, Ridgelinez is taking care of that. As a result of that, core standard ERP, how it can be implemented in-house, creation of a system that utilizes the production knowledge, so we can come up with a specific solution. Creating a data utilization infrastructure is very important. Non-ERP strategy implementation, core platform planning, and consultation, leveraging data. After gaining experiences, we can generate more opportunities. That's the kind of cycle and the routine that's actually being realized already. This, of course, then the ERP and the data utilization, that's exactly what we call modernization. From here on, this will lead to further opportunities.
In other words, this is to generate new values. That's the approach that we work together with Ridgelinez. We already implementing this action, it will further strengthen this kind of action going forward. Number two, this is about the offering sales and the digital sales. Conventionally, well, the business producers and the approach to the customers on the separate and individual basis, but the customers are changing and the business environment is changing. One business producer alone is not able to handle all the aspects of the customers and all the customers, so a new approach is needed to develop the market. Engagement with the customers will be important more than ever. In addition to the conventional approach, we are the proposing three approaches. Number one is offering sales.
The Uvance, which is the company-wide approach by Fujitsu. Based upon Uvance, we make the introduction, demonstrations, and the many different stories. The proposals will be made by the offering sales and approach to the customers in multiple ways. That's number one. Number two is BDR, which means Business Development Representative, BDR. From BDR to specific and individual customer, approach to them, so that the customer can expand the scope of the new opportunities, development of new business opportunities. Based upon that, we make proposals and offer trials and specific on the implementation of these ideas, so the EE will be offered by BDR, digital sales. The third is SDR, which means Sales Development Representative. More macroscopic approach is taken by SDR.
For example, seminars are organized, digital streaming of the opportunities, various, and the touchpoints will be created. The that will lead to specific proposal to the business of the customers. By taking these approaches, more multifaceted, multiple approach, will be taken to cover the area which either hasn't been covered by our activities. That's what we intend to do. Lastly, engagement with the partners. In Japan, we have very strong partners domestically, solution dealers, 450 local partners.
The Fujitsu affiliated information processing service companies, 108. We have very strong partners in Japan. For example, core DX, can it be achieved in some areas? The customers who are wondering what to do with the DX. Together with the partners, we can enhance the engagement, and as a result, various business proposals and the offerings will be made to the customers, and that has to be strengthened. We decided to unify the point of contact with our partners, and also we are shifting our focus from products to digital services, mainly centering around the Uvance. Making development more efficient and also efforts to make the quality management stronger. That's another point I'd like to explain.
Yesterday, Shimazu explained about this, the efficient development, enhancing development efficiency. For us in the frontline, we are also promoting the delivery transformation. The one point is that the maximization of the use of the AGDC JGG. Yesterday, I, the numbers were mentioned to raise the utilization, and the frontline will support that. The agile and the standardized development, remote, and also the connection as well as the centralization, we are going to make the company-wide efforts. One CRM, adequate allocation of the resources. Starting from the early stage of the pipeline, or we are engaged with this, and they make the timely updating. It will gain the trust from the customers, and by updating customers frequently.
That is what we are trying to do to make this more efficient. Delivery transformation will also be promoted by the frontline organization as well. Next is about the enhancement of the quality management. Probably you already know, but on the 19th of May, information security policy was enhanced, and also the system quality enhancement, the companies and the engagement in that area was announced. CQO, and the higher governance, one delivery process, information security, and Fujitsu Developers Platform. All of these activities are done in a more focused manner by a company-wide efforts. We at the frontline organization is also aligned in this company-wide efforts, so that we can offer our value in this area as well. Fujitsu Developers Platform, yesterday, Shimazu explained about this platform.
In the information related to quality in the development field is captured, and the information and issues can be captured in advance and be predicted, and that information shall be fully shared. That will contribute to higher quality and productivity, so that we can create a trusting relationship with the customers, raise it, and also reduce the unprofitable projects. That became possible by using this kind of a platform. In enhancing the quality management, we are also committed to make utmost efforts in enhancing quality in the frontline, from the organization. The next point is about some of the specific examples of innovation. One example is about the electric power companies and the efforts in introducing the renewable energy and also the higher maintenance work for the power distribution facility.
The digital shift in the Uvance is linked to this example. The frontline is also heavily involved in this. Fujitsu's strength is in the sensoring technology and the data processing, or the data and transformation. By fully utilizing these technologies, power companies and the power distribution network, there we apply the laser so that we can catch the vibration due to the wind, and also the solar light and also temperature, and other outside external data can be applied to the process and analyze the data accurately. By so doing, dynamic rating will be possible. In other words, the calculation of the output from the distribution network will be possible. This is instrumental in introducing more efficiently the renewable energy.
Also the drone, operation, for example, the maintenance and the safety can be enhanced to see whether drone can be operated in some area or not, and that will also determine the level of the efficiency. The Chubu Electric Power Company has already adopted this. If this is to be applied to other electric power companies, I believe that they do. Then the several tens of billions of JPY of new businesses will be generated. Another example here, this is Uvance Healthy Living is related to this particular example. In the healthcare area, data-driven business is to be built upon, and the platform is where we can initiate and introduce, so that the new healthcare society will be created on top of that.
We have our own electric medical record business, we have a high share. PHR information will be linked to that. Now, there are some new development by the government, and also the 100% electric medical record system is what is being promoted. How to use the medical data? By enhancing the motivation of the individuals and by using the data. Well, this will reduce the cost of healthcare and the new medical care, new business model for the healthcare and the consumers, the patients, and the general, and the patients, by showing data to them, or the new monetizing data, and a model can be generated with using data.
The PHR, electric, electronic medical record, and the government policies, by combining all of these trends, we can create the platform. In PHR, Sapporo, and the medical university, we started the POC with a different menu. For the additional, the analysis, digital twin, well, Tokai, as well as the other universities are being involved in our projects, and we are sure that we can lead these initiatives and create the application service and also healthcare society, which will certainly contribute to the well-being of the people. Service through service solution, create the affluent Japan and Japan's future. This is what Japan should be, and that's what we would like to support and lead and create. Please give us continuous support and interest in what Fujitsu is going to do.
Thank you very much for your attention.
Thank you very much. Next, COO, Mr. Furuta, please.
Good morning. This is Furuta. Thank you very much for coming back to day two. I would like to talk about the international regions and the, I will moderate the following session, which is a Q&A session. Regions and the, in the last year's announcement of the Medium-Term Management Plan, probably you have some idea about the size or the numbers of our international regions. Revenue, operating profit improvement. Comparing Japan and other regions, well, the regions and the somewhat they are smaller in terms of the size of the operation. Today, I'd like to talk about what we have done in international regions and what we'd like to do in the future.
In summary, international businesses of Fujitsu, these are the 2022 figures after returning them into the financial announcement. The former segmentation was used to show you the numbers for the different regions. Hardware, maintenance, business was excluded from that. Overall, the figures are shown on the left-hand side of this slide. Hardware and maintenance business is excluded, so the services, and as you see at the bottom on the left-hand side, MIS and BAS. We simplified the international business, but MIS means Managed Infrastructure Services. This is the infrastructure service and others. The BAS stands for Business Application Services, so including applications, development, all the way to operation. That's covered by BAS.
As you see on the right-hand side, Americas, Europe, and Asia Pacific, the number of countries we cover and the number of people working in these regions are summarized, as you see. What I want you to look at is the BAS, MIS, and MIS and BAS. How are they deployed? In Americas, it is the BAS, it is focusing upon BAS. Europe and Asia Pacific, MIS business is still large, so we have both. I would like to look back the past years, from fiscal 2020 to 2022, in the period of the previous Medium-Term Management Plan. On the left-hand side, Americas, this worked quite well. Thirdly, we exited from the unprofitable businesses, as you see.
By the end of 2021, we took actions, and last year, 2022, new Business Application Services was initiated Americas business. Americas has been loss gen, loss incurring in the past years, but last year, it turned profitable. I don't give you detailed numbers, but we came to the stage where we were able to achieve the target ratio of 7%, but still the scale is limited. The scale is small, so that is the issue of Americas business. Now, Europe. Historically speaking, Europe has been very strong in the product business. As you may know, we closed the plans and product-centered unprofitable countries, so we exited from those countries with product focus. Structural reform was done and is being done in Europe.
Since last year, since 2022, product business and service business management structure, so we separated these management structures. Now we have the structure which enables us to focus upon the service business. That's what we have done up to 22, fiscal 2022. The low growth margin businesses, the product business, that has been the main focus, they account for more than 50% of the total business, that is the MIS business. It is still the major part of the European business. How to shift it to application area business? Since yesterday, we have been talking about the Uvance and the verticals of Uvance and high-profit horizontal areas, how to shift to those and the high-profit areas. That is a challenge for Europe.
Looking at the results in last year in Europe, so the more than half of the overseas international business comes from Europe, so the structural reform in Europe is important. Last week, the structural reform was the term used by our CFO, Isobe, so that is exactly what we need to do in Europe. The far right, Asia Pacific, since last year, Oceania and ASEAN were integrated into large region called Asia Pacific. ASEAN, Oceania, that's Australia and New Zealand. The countries are somewhat different in nature. The Oceania, they are focused upon service business, and then now, the Asia Pacific, we would like to promote that. By industry, more application area, and the shall be focused upon, and also industries are relevant to that.
On top of that, 4 companies, so the technology consulting, 4 technology consulting companies, so we acquired them. We completed M&A. They are based in Australia, but particularly the company called Enable, which is the 3rd in this list. ServiceNow is the base of their business. They have application, templates, service integration. This really can be done by this company, and they have been operating in ASEAN countries as well. This can be a core function in the business applications of Uvance. That's what we have done to expand the end solution, the DX capabilities. The issues and challenges is Europe and Asia Pacific. As I mentioned on the previous page, the main focus in these two regions is the MIS business. How to turn them into vast area verticals?
That's the challenge. At the bottom, you see common initiatives. The actions we need to take, we have taken all these the initiatives, but we need to accelerate them. First of all, offerings, global offerings, replace the this is synonymous to Fujitsu Uvance and accounts. At the beginning, GAD was mentioned in the previous presentation, and they are focused upon global account, and then delivery, so delivery transformation, global delivery center. JGG is for Japan, the global delivery centers shall be fully utilized for the international and the alliance. There are four points. global four sisters, that was the term used in Americas region in the past. Operation size was smaller, the transformation was easier, but it's region specific.
Offering development or investment, we decided that not to do that. Global four sisters, which are the supporting of these regions. We need to focus upon these four. That's what Americas did, and it resulted in the transformation. This is a very good reference that we were able to utilize in the period of previous MTMP. To the larger regions of Europe and Asia Pacific, I'm not talking about Japan, or I'm not saying that the Japanese will be the heads of the functions. Regionally, we need to transform the regional businesses in these international regions.
I cannot go into detail explanation today, the key strategies, I mentioned about this a little bit already. The business model, portfolio strategy, all the way down to people strategy, listed here. From a Managed Infrastructure Services to BAS, the shift from MIS to BAS is the focus. Top line may not grow so much, but the ratio of MIS and the BAS, it shall be changed to push up the profitability. What we would like to achieve is MIS and BAS ratio. It is 50/50 right now, particularly in Europe. The target is to, by 2025, make the ratio of MIS and BAS up to 50/50, and Fujitsu Uvance is the key to do that.
The global organization, Shimazu yesterday talked about it, and Yoshinami Takahashi and their teams will be fully aligned. He talked about the extended arm, so from a business group to Europe region and the Americas for these regions, well, the people will be assigned, and together with the local team, the region's business will be supported. The 100 people in 2023, this year, we will start this with 100 people, approximately. Investment and allocation and the assignment of the people, it will be done as an initiative of the business group, and that's number one, which works the most effectively. Second is about the customer success and regional strategy.
The consulting capability is to be enhanced, which was mentioned yesterday. By 2025, 10,000 people, 10,000 consultants. That's the we mentioned, and this is part of the program. Consulting lead approach to Fujitsu Uvance, Fujitsu Uvance business shall be expanded based upon that. Globally standardized and approach the customers. Global account strategy, which was mentioned earlier, is related to this. Next is the technology strategy. It is not necessary to mention once again, but our strength is the technology, particularly CaaS, Computing as a Service, and Hybrid IT. We have our own unique IP, so the we expect the synergy effect by combining these to support Uvance.
The people strategy, resource strategy, MIS is the main business in Europe and APAC, but we are trying to shift it to BAS. That means the reskilling will be necessary to enable such shifting. We are going to hire people, and full-fledged and reskilling efforts will also be done. We announced last week, and we mentioned some numbers, and we are going to achieve that through people strategy. Some regions are trying to do these activities on their own or internally, but the strategic resource and planning is to be utilized. Japan is one country, but the regions, Americas, and it doesn't have many countries, but when it comes to APAC and Europe, they cover a multiple number of countries.
Particularly in Europe, country by country, there are some differences. What I mentioned today is about the overall initiatives for the entire international regions and some of the common denominators, common features. The country A, B, C, D, E in Europe, for example, we are making plans for each of these countries. Reskilling may be needed, is needed, and also some countries, the based upon infrastructure service mainly. The it depends upon the country and the characteristics of the country, and that determines what we need to do. The we can come back to you and give you a more detailed explanation, but the today, what I mentioned is the the total picture.
From the, this is within the service solution, so infrastructure service business to application business service, so we need to shift and transform the nature of the business and try to accelerate the shift. That's what we'd like to do. Thank you very much, so much for my presentation. Thank you.