[ Annual Report 2009 ] For the fiscal year ended March 31, 2009

Feature: Meeting Diverse Challenges with Integrated StrengthsSynergies Create Opportunities across Businesses

Kajima is Japan’s leading general contractor-developer. Our focus on generating synergies that transcend business segments is demonstrated by the close cohesion between the construction business and the real estate development business.

We emphasize synergies that transcend business segments.

Our comprehensive capabilities in the construction business are the result of on-site, engineering and sales organizations working together. Yet this core strength is not limited to a single business. Comprehensive capabilities that transcend business segments, such as those enabled by synergy between the construction business and the real estate development business, are another core strength.

Over more than 30 years, our real estate development business has continuously compiled a strong record of achievements, and has differentiated us as the leading general contractor-developer among Japan’s general contractors. We deploy the strengths of the real estate development business not only in development projects, but also as an effective means to help win contracts in the construction business.

A representative example is ThinkPark Tower, the central component of the ThinkPark large-scale redevelopment project in Tokyo. Although we did not participate in the project as a developer-owner, we provided various support services to the owner of the development at the business planning stage. The owner appreciated our expertise in development and construction, and consequently decided to choose us as the contractor for the project.

The real estate development business has supported the acquisition of construction contracts for other projects as well. These include the construction of GranTokyo South Tower in the Tokyo Station Yaesu Area Development Project, for which we were also involved in development, and the concurrent construction of GranTokyo North Tower.

We are able to respond meticulously to diverse customer needs as a single source of a full menu of specialized services spanning every phase of development from business planning, design and construction to property management. The involvement of the real estate development team from the early stage of a proposal increases the likelihood of winning the construction contract, while its effective cost and schedule management capabilities enhance project profitability.

In addition to the close cohesion between the construction and real estate development teams, there has recently been an increasing number of opportunities for our construction and engineering teams to work closely together in making proposals.

A New Solid Formulation Plant for Tohoku Nipro Pharmaceutical CorpA New Solid Formulation Plant for Tohoku Nipro Pharmaceutical CorpA New Solid Formulation Plant for Tohoku Nipro Pharmaceutical Corp
Generating New Synergies:
A New Solid Formulation Plant for Tohoku Nipro Pharmaceutical Corp.

Our construction and engineering businesses have successfully developed synergies that transcend business segments. Since the revised Pharmaceutical Affairs Law went into effect in April 2005, many large pharmaceutical companies have consigned production of their proprietary products to other companies. Tohoku Nipro Pharmaceutical moved to expand its contract manufacturing capacity by planning the design of a plant specifically for that business.

Our engineering division is a leading professional organization involved in the construction of pharmaceutical facilities. Working in concert with the construction division on business development, the engineering division took the lead, deploying skills including CGMP1-compliant facility planning and proposals for factory automation to raise productivity. As a result, we won a comprehensive contract for construction of the buildings and production facilities.

After obtaining the contract, the engineering division served as the point of contact with the customer, which enabled it to thoroughly understand the customer’s needs. Moreover, concurrent construction of the buildings and production facilities and operational studies at the early stages enabled us to meet the client’s request for a short construction period. In addition, we kept costs low by rationalizing2 the construction of the buildings and the production facilities through means including changes in construction categories3 and consolidated ordering.

This project is an excellent case study of our commitment to being a single source for engineering and construction solutions. Going forward, we will create more projects that generate synergies.

Notes: 1. CGMP is the acronym for Current Good Manufacturing Practice. Each country has Good Manufacturing Practice (GMP) quality standards. CGMP standards are those of the United States, and they are the most rigorous.
2. Rationalizing means optimizing the scope of work and order allocation between construction and engineering. Kajima revised purchasing so that construction operations were not ordering items that engineering could order at lower cost and vice versa.
3. Changes in construction categories basically means changes in the scope of work of construction and engineering.
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