Innovation never begins with an idea or an instrument. To the contrary, it begins with a need, the discovery of an opportunity. Hitachi meets these needs with new technologies for designing solutions that can create a tangible and positive social impact, and a visible and persistent change. This is how it manages its projects, by analysing them as plans or proposals able to display solutions that can work. It creates a prototype with the project, and demonstrates how to implement the idea and attain the expected results. This “scientific” approach allows it to assess the feasibility, costs, market and value of the solutions.
Therefore, Social Innovation for Hitachi is the way to:
In January 2019, Hitachi Rail STS has created a group explicitly and exclusively dedicated to the theme of innovation, to be developed over the next few years with dedicated budgets and resources.
The first objective was to give a clear definition of the concept of innovation by choosing the one given in The Little Black Book of Innovation by Scott D. Anthony “Blueprinting is an idea to seize that opportunity, and implementing that idea to achieve results: no impact, no innovation.”
This definition highlights how, for Hitachi Rail STS, innovation is a structured process that requires a rigorous approach and a well-defined set of activities. Starting from a need, a business opportunity is identified to satisfy it.
The best solutions (ideas) are identified, eventually resulting in new technologies and competences, according to the logic of ‘open innovation,’ and, finally the prototypes of these new solutions are created to demonstrate their effectiveness in satisfying the need. This creates a positive impact on the business and the community.
The second clearly-defined objective was the role and purpose of the new team’s work. The following figure summarizes the domain of the innovation team and where it is located — away from current solutions and business. As a result, it becomes a collector of opportunities, ideas and skills, delving into new technologies. The final objective is to create prototypes of new products and solutions that, transferred to the engineering and development bodies together with the related new skills, can enrich the Company’s product portfolio of tomorrow. Methods used by Hitachi Rail STS to eliminate and simplify hardware.
Over the years, its development of products and solutions (Development and Engineering) has enabled Hitachi Rail STS to seize a leading position in the Signalling Systems and Railway and Mass Transit Sectors.
The research and development expense ascribed directly to profit or loss, net of grants, shows significant growth and is broken down in the following table:
The majority of investments regarded the on-board systems product line aimed at facilitating alignment to the ERTMS standards and improving the performance of CBTC applications; furthermore, the new platform for automation products was launched, aimed at promoting the digital development of technology.
Hitachi Rail STS implements RAMS (Reliability, Availability, Maintainability and Safety) activities to ensure that it develops and delivers products, applications and systems that are safe, in compliance with Italian and international laws applicable to railway systems, reliable and in line with its customers’ needs and its internal quality standards.
These activities are performed on all Hitachi Rail STS projects in which safety and reliability are relevant, which constitute over 90% of total business activities.
Safety and reliability are achieved through hazard analysis, a structured process in line with sector standards. It begins with the identification of hazards based on previous experience, the assessment of specifications for the various processes stages and Hazard workshops during which experts from the Company and from the customer discuss the various issues. Potential hazards are then included in a Hazard log, which is constantly updated over the life cycle of the project. For each hazard mapped, the log also includes the mitigation measures, activities to check that they were effectively implemented and an assessment of the residual hazard. The residual hazard level is assessed and accepted only if it is below the limits established by standards and customer requirements.
Hitachi Rail STS’s unwavering commitment to providing its customers and end users (passengers and freight) with the best products and system solutions, the use of the best design methodologies and procedures and the best existing construction methods and processes contributes to increasing safety and reducing direct and indirect impacts on the environment.
In view of the increasing importance of the supply chain’s social and environmental aspects, Hitachi Rail STS has drawn up new criteria to assess and monitor its suppliers and to define a new action plan to assist them in improving their sustainability.
Hitachi Rail STS’s supplies include:
Orders by suppliers’ geographic location were as follows:
Supplier vetting and the process for the purchase of assets, goods and services are carried out in accordance with the principles of the Code of Ethics and internal quality procedures, as well as current health, safety and environmental regulations.
In order to increase integration and improve the management of suppliers along the Supply Chain, a new unit called Supply Chain Quality was created, and it comprises three bodies: Supplier Qualification & Monitoring, Quality control and Incoming Inspection. The qualification process is interdisciplinary and based on the opinions of several units involved therein under the guidance of this new body. This includes the technical, procurement, quality and HSE departments.
Furthermore a cloud-based qualification IT platform was implemented to globally standardise and centralise management of the qualification process and supplier documentation in a single database. The digitalisation of this process led to greater control in addition to allowing the data management methodology to be further developed in an extremely vaster way in view of additional improvements to the system for monitoring activities carried out by the qualified suppliers.
The supplier questionnaire was further consolidated, focusing on the following HSE aspects:
The questionnaire is sent to all new suppliers during the qualification phase.
Hitachi Rail STS conducts an initial mapping of its supply chain with respect to compliance with Environmental, Social and Governance (ESG) criteria. Indeed, the standard purchase order model includes general supply conditions and compliance with the Code of Ethics; furthermore, when vetting new suppliers, Hitachi Rail STS gathers information on their compliance with quality, hygiene, health and safety in the workplace standards and their environmental policies and requires certification according to standards ISO 9001, ISO 14001 and OHSAS 18001. These characteristics are considered preferential requisites and contribute to assigning the score for qualification.
The results of the mapping were as follows: ;
The mapping of the supplier base, made easier by centralising the process management at global level and its digitalisation, is one more step taken in a specific Supply Chain sustainability policy. The main guidelines of this policy are:
the extension of periodic monitoring activities to critical and A Class suppliers.
The economic benefit of working with Hitachi Rail STS can be measured by considering the intensity of its suppliers’ workforces. Accordingly, the following should be considered:
Therefore, the labour intensity factor of Hitachi Rail STS’s orders is roughly 58%: approximately EUR 542 million is paid to suppliers to cover their labour costs.