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Corporate profile

Ernst & Young Advisory Co., Ltd.

Index
Our Message 03, 04
Our Position & Services 05,06
Our Solutions 07
Finance transformation 08
Supply chain management 09
Customer relationship management 10
People and organizational change 11
IT advisory 12
Strategic direction 13
Our Industries 14
Product 15
Retail 16
Energy & Infrastructure 17
Life sciences 18
Healthcare 19
Financial 20
Automotive 21
Real Estate 22
Our global network 23 26
Outline 26

| Ernst & Young Advisory

Ernst & Young Advisory |

Our Message
Why Ernst & Young Advisory?

Growth is an eternal issue for companies, and its importance has


become greater than ever before. Where is the source of growth
now, and where will it stem from in the future?
Being able to effectively respond to the demands of the global
economy and be nimble when innovating are at the heart of the
matter. Companies must boldly reform themselves in order to
remain competitive in the global market and sustain growth.
We believe it is the continuation of this challenge that is the
source not only of vital revenue growth for a company but also of
innovative approaches to its people, organizational reform and
business models that are effective on a worldwide scale. Ernst
& Young Advisory strongly supports our clients' challenges by
developing talent with specialized knowledge and skills across
multiple industries, taking a business sector-focused approach to
problem solving and delivering our diverse capabilities globally.

| Ernst & Young Advisory

Ernst & Young Advisory |

Our Position & Services

The Position of Ernst & Young Advisory

We at Ernst & Young Advisory, a Japanese member rm of EY,


provide a benecial mix of services with farsighted global vision and execution
for the business issues faced by all our clients.

EY is organized into four core business lines: Assurance, Advisory, Tax, and TAS.
We at Ernst & Young Advisory provide advisory services of a globally uniform quality using methods and
tools developed by the EY network. Our services in Japan are tailored to the needs of our clients and the
local market through the use of the knowledge and experience of professionals from various elds.

Ernst & Young ShinNihon LLC

Ernst & Young Advisory Co., Ltd.

Ernst & Young ShinNihon Tax

Ernst & Young


Transaction Advisory Services Co., Ltd.

The Services of Ernst & Young Advisory


6 Solutions
We help to strengthen and improve our clients' business processes and functions in all business sectors
and industries using six solutions.

Finance transformation
Supply chain management
Customer relationship management
People and organizational change
IT advisory
Strategic direction

9 Industries
We also respond to business issues requiring depth of specialization in industries from which our teams
of experts come, such as product, retail, energy & infrastructure, life sciences, healthcare, nancial,
Automotive, real estate, government, and so on.

| Ernst & Young Advisory

Ernst & Young Advisory |

Our Solutions

Our Solutions

Finance transformation
With all the signicant changes in the market including globalization, increasing cost pressures, and
rapid responses to business needs CFOs face a range of operational challenges and issues. Also, their
accounting and nance departments require strong and exible management support functions.
Ernst & Young Advisory provides professional services that help enable clients to enhance their CFO
functions and build more efcient and effective operations to achieve their strategic goals.

Business areas and issues with which we can support


Although there are no problems in nancial accounting involving the preparation of nancial closing
information, there is action needed to improve management. there is action needed to improve
management, such as the analysis of information used for management purposes, managing difcult
operations or processes, or making strategic planning proposals, etc.
A lack of transparency involving nancial information or other information needed for global
management has resulted in the information needed for managing group companies not being
properly or punctually collected.
Delays in standardizing or automating accounting or nancial processes interfere with moving
forward with outsourcing or shared services arrangements.

Our main Finance transformation services

Finance transformation
Supply chain management

Group management control

We support our clients in building or enhancing group management


functions and in implementing IT systems. This is done by dening
the nancial data and key performance indicators (KPI) necessary to
support robust management reporting with due consideration to the
company's business characteristics and its place in the global market.

IFRS implementation services

Our service does not stop at simply dealing with changes in accounting
standards; it includes assisting clients in areas such as building a base for
managing group companies for pushing ahead with standardized groupwide business performance indicators.

Accelerated nancial closings

We help clients achieve an accelerated time frame for their nancial


closing process by reviewing this process across group companies and
improving their daily accounting operations this is as opposed to simply
shortening the number of hours spend on the nancial closing process at
the parent company.

Improvement in the preparation


of consolidated nancial closings

We assist our clients with their implementation of systems for their


consolidated nancial closing process and with improvements aimed at
optimizing the structure of these processes. This service ranges from
statutory accounting to setting up units for information in management
accounting (units according to product, customer, or division).

Stronger management of
overseas subsidiaries

We help clients in building or planning out their organization


for group or subsidiary management. We also help clients with
strengthening their corporate governance and with devising their
policies for managing subsidiaries in line with their strategy and
group management policy.

Financial process integration


associated with a reorganization

We provide comprehensive support in areas aiming at maximizing


the corporate synergies expected from a corporate re-organization.
This includes implementing an infrastructure for group management,
integrating IT systems and reappraising existing processes.

Shared services center


SSC

We provide end-to-end support in designing a shared services structure,


building the processes contained therein and implementing the
associated IT systems. Our focus extends beyond the reduction of
operating costs to improving the quality and timeliness of nancial and
accounting processes.

In addition to the above, through the use of the EY global network of rms, we also assist clients with domestic
and overseas investor relations (IR).

Customer relationship management


People and organizational change

Finance transformation approach (Example)


Step1

Identify requirements and


devise a plan

IT advisory

Analyze the corporation

Step2

Understanding Current State

Step3

Diagnosis and Assessment

Step4

Proposal of an action plan

Collect information related to current


processes

Access the degree of advancement of


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Put together and then prioritize


improvement opportunities

Organize a project team

Research the VOC


(Voice of the Customer)

Establish benchmarks for accounting and


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Create a roadmap

Set a common vision of the


transformation

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evaluation criteria and benchmarks

Identify and agree on improvement


opportunities

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Create business cases

Strategic direction
7

| Ernst & Young Advisory

Ernst & Young Advisory |

Our Solutions

Our Solutions

Supply chain management

Customer relationship management

The optimization and upgrading of a supply chain - through means such as improving processes tied to
supply and demand, strengthening cost competitiveness, reducing lead times, or the establishment of
a Business Continuity Plan (BCP) - has become an urgent task for companies amid a globalization of
manufacturing and sales bases, stiffening price competition worldwide and natural disasters. In addition
there are business processes which should be taken into consideration at the time of deploying a global
supply chain. Ernst & Young Advisory can help you with implementing better supply chains for your
company by providing services ranging from strategic planning and process improvement to IT system
.
implementation, this while giving due consideration to the appropriate change management

In the current economic climate, companies have been reminded of the need to identify their key
customers and establish and maintain more effective and lasting relationships with them. It has become
increasingly important to take a cost-effective approach to customer segmentation when addressing
marketing and sales initiatives. Companies need to identify who are their important customers and then
establish, and maintain, a more effective and continuous relationship with them. During our review and
support of improved customer management, we begin the transformation of our clients' relationships with
their customers by asking the simple questions: Who are your company's customers and are they happy
with your company's products, services and support both before and after the sale? Surprisingly, the
answers to such questions typically provide the foundation for a signicant relationship transformation.

Business areas and issues with which we can support


With a volatile economic climate, our client wants to reduce the risk of surpluses and shortages of
stocks by strengthening links between the functions of production, sales and distribution and by
improving their ability to adjust to supply and demand.
In response to calls from the market and their customers to cut costs, our client wants to become
more cost-competitive by reducing its purchasing costs for direct and indirect materials or costs
involving inventory or distribution.
Our client wants to construct a highly effective and economical supply chain taking into account
the impact of not only operational streamlining but also customs duties and transfer prices.

Our main Supply chain management services


Transforming plans involving
supply and demand and the
process of implementing them

We can assist you with your review of processes involved with plans for
managing supply and demand. This includes demand forecasts, sales or
supply plans (inventory, production, purchasing) Our service aims to
eliminate overstocking and shortages, improve cash ows and prevent
the loss of sales opportunities.

Optimization of inventory and


distribution hubs

With production and sales centers becoming more global and with an
increasing number of inventory and distribution hubs for materials and
products, are services support clients in analyzing their networks and in
positioning and running inventory and distribution hubs at the minimum
cost using Scenario Planning.

Cutting procurement costs for


direct and indirect materials

Our service entails analyzing the existing cost elements behind materials
used directly and indirectly and the impact of any improvements. It
also includes selecting products targeted for cutting costs, making the
procurement processes and their results more transparent and building a
set-up for making continual improvements.

Tax Effective Supply Chain


Management
(TESCM*)

By utilizing our tax advisory knowledge and EY's global network, we can
assist you with the implementation of supply chain operations, taking into
consideration the nancial impact of customs duties and transfer pricing.
We also consider how to enhance risk management and compliance
management.

*TESCM (Tax Effective Supply Chain Management) means studying and establishing a business structure
that aims to optimize both Supply Chain Management and the tax function.

Business areas and issues with which we can support


Our services entail helping clients gain insights into customer data they analyze regularly.
With an eye towards making signicant changes to their operations, our client wants a review of
certain areas of these operations which takes into their account customer needs, expectations and
cost effectiveness.
Improved ROI from marketing activities is a client goal as is better customer cash ow
management and protability.

Our main Customer relationship management services


CRM quick assessments

We support in the selection of a theme your company should examine by


using our Ernst & Young Advisory template to conduct a simple diagnosis
of the overall CRM operations speedily and thoroughly with customers as
the starting point.

Marketing strategy
planning support

We draw up a roadmap to nd and implement the best way of


communication between your company and its customers based on
future media and communication trends in addition to our international
and domestic expertise.

Customer service
management support

We support the planning and execution of the review of your company's


services, costs etc. in consideration of customer evaluations and
importance. Through a cross-sectional check of the touch points between
your company and its customers, we redene your optimum services.

Channel and sales


transformation support

Taking recent diversications of customer purchasing and procurement


channels into account, we support the planning and execution of a
review and consolidation of existing channels. We also support sales
organization restructuring and operational streamlining in order to
optimize the functionality of that mixture of channels.

Contact center
transformation support

We see service centers and call centers as being important touch points
for increasing customer satisfaction and brand loyalty. We support the
design of service menus, information transmission rules and procedures,
and KPI for a base of controlling information to customers.

Supply chain management approach (Example)


Step1

Step2

Step3

Supply chain diagnosis

Detailed plan on a policy


to transform the supply chain

Implementing the transformation


and having it take hold

In line with the action plan created for


the supply chain diagnosis, we then
help in drawing up a central plan aimed
at carrying out the measures to solve
the issues, this while embedding
specic points such as dening the
process for these measures, devising
new rules for this process, establishing
Key Performance Indicators (KPI), etc.

In line with the central plan, we have


the client conduct its business
activities based on new processes and
rules and then, within a PDCA cycle,
assist the client in monitoring the
transformation by extracting
operational issues and in following the
development of KPIs until the
transformation takes hold.

Conduct hearings on existing

Dening the scope for applying

Introduction of new business

visualization

Identifying gaps between the

state of the existing supply


chain and the way a supply
chain should be.

Prioritizing how issues are

handled and resolved

Clarication of supply chain

management requirements

Devising an action plan

| Ernst & Young Advisory

Design of processes
Designing the set-up and

organization

Setting KPI
Certain verication
Designing the systems
Devising the central or

main plan

System implementation
Change management
Monitoring
Operation follow-up
Planning for the next stage

Circle size = Level of customer happiness

Customer
Contact center
transformation support

Channel and sales


transformation support

Marketing strategy
planning support

Your company

Customer service
management support

Issue identication and

the measures to transform the


supply chain

Roadmap of transformations to
your company's services (Example)

CRM rapid assessments

operations

Customer solution approach (Example)

Contribution to your company's performance


(Enhancement of customer relations)

We help our clients reduce their


distribution costs and assist them with
their strategy for building a global
supply chain. This is done by rst
extracting the issues and proposing
measures to resolve them and then
drawing up a general roadmap and
detailed action plan.

Contact center
transformation support

Channel and
sales transformation support
Customer service
management support
Market strategy
CRM rapid assessments

Transformation progress

Ernst & Young Advisory |

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Our Solutions

Our Solutions

People and organizational change

IT advisory

High economic growth can no longer be expected in Japan, so companies are faced with the issues and
challenges of both overseas business expansion and domestic business streamlining. The question is how
they can build diversied management system which more non-Japanese employees and non-regular
employees are involved in.
By developing sophisticated people and organizational management system being able to develop global
talents, harmonize multicultural organization, and build effective group governance structure, companies
are required to enhance their organizational strength, become competitive and grow.
Ernst & Young Advisory supports our clients to maximize their corporate value by providing
comprehensive services ranging from strategic planning of people and organizational change to
development of human resource management.

The IT environment is continually progressing and changing. Its utilization in business management is a
source of competitive strength amid increasingly tough competition. Even in the recent harsh economic
climate, there are many progressive companies that fully utilize IT to generate more growth. How does
the IT environment of your company compare with your rivals? At Ernst & Young Advisory, we support
the planning and implementation of an IT strategy that will become a source of corporate strength, by
introducing other company cases in various industries and progressive methods from similar industries.

Business areas and issues with which we can support

Business areas and issues with which we can support


Our client receives requests daily from the eld for IT improvements but does not understand the
investment benets or the suitability of the measures it is trying to implement.

Our clients need change management support when they do not have the capacity or capability to
deliver performance improvement results.

Interconnecting multiple ongoing IT projects and helping the organization and its personnel handle
the workload.

Our clients need to continuously manage their workforce to deliver in line with the changing business
priorities and customer demands.

Helping clients with the important tasks of assessing the adequacy of IT work performed by
contractors and in dealing with a lack of IT governance and concerns over IT security.

Our clients need to continually adapt to change due to which improvement programs are
required that can lead to a more effective and efcient Human Resource organization.

Our main People and organizational change transformation services


Organization design

Change management

Helping the client dene the way structure, role and resources are
designed to deliver the strategy and operating model blueprint. This
includes designing the formal system of accountability that denes key
positions and enables the efcient allocation of resources to support
business outcomes.
Supporting the transition from current state to future state in any of
the areas of Structure, Process, System, Operations, and People in an
organization.
This also includes making cultural changes by assessing the cultural
impact of proposed business changes and assisting with the design of
change strategies including communications on change programs.

Talent management

Working with clients in balancing the talent demand and supply to


support management decisions around how to best secure the supply of
talent to maximize business results.
Assisting clients to optimize workforce management by analyzing
labor costs, workforce scheduling, productivity, employee 'churn' and
recommending actions to improve workforce exibility.

HR transformation

Assisting the client with the development and alignment of the HR


function strategy, the design of the HR function organization, including
Service Delivery model and roles and responsibilities, developing HR
Scorecard and HR Technology as well as improving HR Policies and
Processes.

HR process efciency

Providing the client assessment, design and implementation support for


improvements in the HR function. This includes assessing the maturity
of the client's HR processes compared to industry practices and focusing
on specic HR process needing review, redesign and sustainable
improvement.

People risk assessment

Supporting the client in identifying risks and compliance requirements


associated with People and HR in order to reduce nancial liabilities and
increase function preparedness.

Post merger integration

Supporting the integration of organizations, process, systems,


operations and transferring and reassigning personnel after Day1.
This also includes supporting change management after Day1
(stakeholder analysis, change management planning, leadership
alignment, training development, communication planning, etc.)

Our main IT advisory transformation services


IT strategy planning support

We support the planning of an IT strategy (mid- to long-term plan) that


provides a competitive edge, taking into account compatibility with
management strategy, trends in customers' industries, progressive
measures in similar industries, and so on.

Investment efciency analysis


IT design planning support

We support the planning of effective IT design taking into consideration


of investment benets, etc. in regard to measures in response to local
needs and industry trends. We also help with RFP creation for launching
IT projects.

IT governance &
standardization support

We support the establishment of IT governance


frameworks(organization, approval authority, responsibilities and
roles, personnel resources)and the design of standard denitions
and management processes for IT service operations and enabling
technology.

IT design planning support

We support implementation of PMO operations to achieve initial targets


and realize cost, quality and delivery control in IT projects, and operation
control across multiple projects.

System construction and


installation support

We support the construction of new systems and the installation of


individual solutions in the forms of ERP, BI, CTI and OCR. We also help
with the BPR and establishing that accompany systematization.

Existing system
improvement support

We support the improvement of degraded performance and inefcient


input interfaces in existing systems such as ERP.

System operation,
maintenance outsourcing,
and TCO reduction support

Through automation, virtualization, sharing, outsourcing, etc. we


support the implementation of reduction measures for TCO related to IT,
namely, system operation, maintenance, monitoring, software licenses,
and servers.

IT advisory approach (Example)


Step1

Step2

Step3

Analysis of current state

Issue identication

Deployment of solutions

Assess current operations, IT systems,


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operational processes and IT systems

Interview personnel and analyze


competitive internal and external
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Analyze root causes

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| Ernst & Young Advisory

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Dependencies

Step4
Step4
Solution execution support

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solutions portfolio

Support system implementations

Provide operational
transformation support

Prepare a prioritized action plan

Ernst & Young Advisory |

12

Our Industries

Our Solutions

Strategic direction
What should be prioritized when restructuring global business operations? As the components of business
have become more comprehensive and complex, it has become more important than ever before to
have a strategy for undertaking consistent management actions. At Ernst & Young Advisory, we take full
advantage of our network of highly qualied professionals in Japan and overseas to support the planning
and implementation ofstrategies that our clients need.

Business areas and issues with which we can support


Our clients need change management support when they do not have the capacitiy or capability to
deliver performance improvement results.
Our clients need to continuously manage their workforce to deliver in line with the changing business
priorities and customer demands.
Our clients need to continually adapt to change due to which improvement programs are
required that can lead to a more effective and efcient Human Resource organization.

Our main People and organizational change transformation services


Mid-term management planning

How can you overcome organizational barriers and actually generate


group synergy? How can you respond to the external economic climate
change? We support measures to deal with these two challenges in a midterm management plan.

Management control
visualization

We support massively improved communication quality in management


control through the introduction of a visualization tool that expresses,
in terms of the value chain, the causal relationships of risks to achieving
management targets, thereby eliminating misunderstandings that can
occur in theaerial combatof management meetings and replacing them
withground combatdiscussions.

Market driven
management control

How can you incorporate your response to market changes, whether in


growing emerging markets or the declining domestic market, into the
management control process? We support the restructuring of your
management control process.

Company-wide cost reduction

Small improvements x number of ofces x time = giant cost reduction.


Using theabolition, simplication, automationmodel of operational
improvement, we identify excellent improvement opportunities that still
exist within operations and help you to reap the benet.

New business launching

By applying theprototype approach


, a methodology effective for
untried projects, to the launch of new business in which you have no
experience, we help you to benet from aquick win
.

Project acceleration

There is a large increase in the number of cases in which speed


determines success or failure. We help to implement a project promotion
method to meet the conditions for achieving extraordinary speed in a
project.

Global projects

Overcoming linguistic, cultural and time difference barriers leads to


success in global projects. Using a variety of methods backed up with
our wealth of experience, we help you to cross the various barriers that
hamper the success of your global projects.

Product
Retail
Energy & Infrastructure
Life sciences
Healthcare
Financial
Automotive
Real Estate

Approach example(Introduction of management control during period of decline)


Step1

Step2

Step3

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| Ernst & Young Advisory

Ernst & Young


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14

Our Industries

Our Industries

Product

Retail

Against the background of the economic stagnation, the deteriorating cost competitiveness, and the
growth in the emerging markets, Japanese manufacturing accelerate developing new business and/or shifting
their production sites in overseas. As they expand their business in overseas, they become facing new
various business challenges such as globally restructuring of organization, supply chain, or infrastructure
of group management for timely/effective decision-making.
Ernst & Young Advisory with well experienced consultants in the manufacturing can support these
challenges and assist your company to become a global company by providing an end-to-end service, from
strategy development to business process re-engineering/system implementation & change management.

Amid major changes in the consumption environment due to the low birth rate and aging population,
decreasing population numbers, stagnating individual earnings, and rising consumption tax, the retail
industry is facing wide-ranging challenges.
In addition, consumer behavior is being transformed by the increasing popularity of computers and smart
phones. Survival in this turbulent environment requires making pre-emptive strategic changes irrespective
of existing business structures and trade relationships.
Ernst & Young Advisory's retail sector aims to provide services - from strategic planning to process design
and implementation - which are workable and are necessary to respond exibly to, and increase revenue
from, the markets surrounding consumer goods and the retail industry.

Business areas and issues with which we can support


Our client wants to resolve the risks posed by international taxation and supply chain inefciency
risks resulting from the rapid globalization of production and markets.
Our client wants to overhaul its group management infrastructure, including its overseas subsidiaries,
to make a timely/effective decision so as to ensure the accomplishment of their management plan.
Our client wants to improve its protability by pushing through further cost reductions in their
indirect department, aiming at domestic business areas where signicant growth cannot be
expected in the future.
Our client wants to optimize its organization through faster improvements to its processes, this
to quickly take advantage of synergies gained through reorganization.

Our main Product services


Global Supply Chain
Restructuring

Group Management
Infrastructure Restructuring

PMI (Post Merger Integration)

Indirect Department
Transformation

Cost Management Reinforcement

We provide an end-to-end service, from strategy development and to reengineering/system implementation & change management. This service
aims to resolve challenges in the supply chain that have emerged along
with rapid global expansion, such as overstocking, stock shortages and
increases in operating costs.
To ensure the achievement of management targets, it is essential
that daily decision-making in each group company be directly linked
to improving the performance of the group as a whole. We will
systematically set Key Performance Indicators (KPI) for each
organizational level in line with the group management targets for your
company, and support the building of a process base and system base for
group management using these KPI.
Reorganization requires simultaneous and parallel integration of
schemes, processes, systems, and organizations. We not only do
integration work with experts in various elds but also help to generate
the effects of project control, change management, and business
reorganization in order to bring multiple organizations of differing
cultures together into one.
(Introducing Shared Services or Business Process Outsourcing)
Indirect department costs tend to rise as business locations increase,
such as in the penetration of new business or emerging markets. We
select the optimum methods of reform for your company and support
their introduction and establishment, such as Business Process
Outsourcing (BPO) or changing to Shared Services, in order to
manage to both reduce the cost of indirect department and sustain and
improve process quality.
We not only provide data to assist in cost-reduction activities at
production sites in Japan and overseas, but also help to strengthen your
company's cost management by reconstructing the schemes, processes,
systems and organizations concerned with cost management, with the
aim of achieving cost management that can deliver timely and accurate
cost data that contributes to management and sales decision-making.

Examples of Product projects


Service area

Business areas and issues with which we can support


Our client wants to know its customers better and analyze and redene the value they provide, and to
reform itself so as to continue to create acustomer experience.
Our client wants to rejuvenate its stores and raise customer satisfaction levels by accepting the
utilization of big data and restructuring its marketing and merchandizing operations.
Our client wants to improve orders and stock control by forecasting store demand, this to raise
customer satisfaction levels while simultaneously improving the efciency of their funding
operations.
Our client wants to analyze and utilize the purchase data and social data of their retail partners
to raise the success rate of their new products.
Our client wants to analyze their own cost structure based on examples of leading companies
so that they can streamline merchandizing expenses, optimize labor costs , and decrease
distribution costs.

Our main Retail services


Product development processes
and tool install and run

Retail services deals with product development processes and tool


introductions as well as with operational support in helping you in
resolving problems including deteriorating prot margins or continuous
disposal sales due to misunderstandings market needs and demand.
We help to install and run integrated processes aimed at accuracy and
efciency, from product planning and development to market launch and
evaluation.
Rather than simply install a tool, our Business Process Outsourcing

ID-POS data analysis introduction (BPO) services support your redesign, establishment, and running of
a hypothesis verication function centered on data analysis, so that you
and operational support
can apply your accumulated customer purchase data (ID-POS data) to
your marketing and merchandizing operations.

Logistics strategy planning


support

We help to restructure not only your logistics but also the logistics
from the perspective of the entire supply chain -from manufacture to
selling - covering everything from the initial diagnosis to total design and
contractor selection. This is a powerful tool in the present environment.

Stock adjustment tool


introduction and operations
support

We can support your planning, development and operation of a demand


prediction model and stock optimization solution to deal with the various
problems that occur due to inaccurate demand forecasts or inadequate
basic inventory models (these problems include a worsening cash ow
due to overstocking, missed sales opportunities and drop in corporate
trust due to product shortages or other factors).

Description of main services


Supporting cost reduction measures by reviewing the visualization of the

Global Supply Chain


Restructuring

Group Management
Infrastructure Restructuring

Indirect Department
Transformation

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| Ernst & Young Advisory

commercial distribution structure and the challenges, estimating and analyzing


the effects of optimizing the supply chain, and drawing up a basic concept and
action plan.
Helping to plan, install and establish a tool that supports demand prediction .
Assisting in the restructuring of the supply chain on the basis of the merits of
international taxation, such as customs duties, in collaboration with Ernst &
Young Shinnihon Tax.
Support in the construction of a functional layout for a parent company or for
general regional companies or locally-incorporated companies.
Support with the intra-group authority; with responsibilities when a general
regional company is established, and with a performance management system.
Helping to integrate business management by reconstructing a business
management data system previously uncoordinated between different
business companies.
(Introducing Shared Services or Business Process Outsourcing)
Identifying your current process problems in the areas of accounting, human
resources, IT systems, and purchasing, then selecting the areas for reform or
improvement by using a benchmark analysis.
Upon completing a benchmark analysis, choosing an outsourcing provider,
then supporting your shift to new processes and a new organization through
the time of their establishment .

Examples of Retail projects


Service area

Description of main services

Streamlining and
cycle-shortening of product
planning process

Helping you to streamline business talks, specication denition, and


planning, based on the trends and partner collaboration in a major mailorder company

Support for hypothesis


verication MD using ID-POS
data analysis

Assisting you in conducting a feasibility study before an ID-POS analysis


system is installed, or with your tool selection, implementation, and
Business Process Outsourcing operation in major retailers.

Support from logistics


strategy planning through to
implementation

Helping you, as a major food wholesaler, with strategic planning,


process design, and contractor selection for reorganizing your
distribution base

Support for stock reduction and


order streamlining

Assisting you, as a major mail-order company, in improving forecasting


accuracy and in adjusting stock levels by installing ARBI*, Ernst & Young
Advisory's unique demand prediction and stock level model
*Arrival Rate Based Inventory

Ernst & Young Advisory |

16

Our Industries

Our Industries

Energy & Infrastructure

Life sciences

The Great East Japan Earthquake provoked the strong interest in energy policy-making worldwide. Today,
Japanese energy industry faced the dynamic change; increased renewable energy use and separation
of electrical power production from power distribution and transmission. Also, a signicant change in
infrastructure business is triggered by the following factors: declining birth rate, aging population in
developed countries, and demographic change due to population expansion in emerging countries.
Ernst and Young Advisory provides the best solution for the challenges that are not One-Fits-All, such
as developing strategy for energy companies/manufacturers, smart city planning for the government, and
packaged infrastructure export -through our global network.

The life sciences industry, already under strict legal regulation and exposed to severe global competition,
is facing urgent measures for structural change due to the emphasis on preventive care in our aging
society, the government's policy of curbing the growth in health care costs, and the emergence of generic
drugs.
Ernst & Young Advisory's life science sector professionals provide businesses with strong support,
creating a clear vision of the future and pushing through solid execution. We can deliver a wide range
of services from strategic planning for whole companies or individual products and branding to process
improvement, compliance strengthening and IT solutions.

Business areas and issues with which we can support

Business areas and issues with which we can support

Wish to expand business in emerging markets with your competitive products and services due to a
slow growth of Japanese market.

Our client wants to implement robust company-wide organizational changes in order to achieve the
revenue targets in their mid-term management plan.

Wish to start a new business in an exsting industry or a new technological area in the increasingly
competitive environment due to globalization.

Our client wants to review their cost structure based on advanced cases of Japanese and overseas
companies in the same industry, and to reduce their overall costs.

Wish to develop management control system to make a prompt decision on foreign operations
due to the lack of visualization of business management.

Our client wants to achieve improved compliance with related laws and company and industry
rules (such as codes of fair competition, transparency guidelines, etc.) and at the same time
raise operational efciency.

Our main Energy & Infrastructure services

Our main Life science services

Emerging Market Advancement


Support

Offer an array of services, including screening, evaluating, selecting


target countries for a global expansion and developing the strategy of
advancing into foreign markets .(by Self-funding/Alliance/M&A, etc.)

Strategic planning for overseas


expansion
Construction of a global
management base

New Business Development


Strategy

Offer an array of services to Energy & Infrastructure rms to develop


strategy of starting business and evaluate and select target alliance
companies.

Product strategy planning

Japan Market Advancement


Support for Foreign Companies

Offer an array of services to foreign companies to advance into Japanese


market by conducting feasibility study, selecting optimal alliance
companies, and providing alliance support.

Consolidated Business
Management Support

Support to build a consolidated business management system to collect


nancial information by businesses, and regions, which help making a
decision promptly.

Accelerating the development and penetration into emerging markets

and review existing overseas businesses.

Internationalization of head ofce; management restructuring to make

overseas ofces more self-reliant.

Product portfolio strategy and new-product launch strategy proposals.


E-promotion strategy proposals, content and web vendor selection,

production supervision, effect measurement.

Segmentation and targeting.

Sales strategy planning

Reallocation of resources across multiple products, optimization of MR

territories.

Establishing sales PDCA cycle.

Establishment of management
accounting methods

Reduction in manufacturing costs.


Optimum allocation of sales and administrative expenses.
Constructing and maintaining a risk control system, compliance system

Reinforcement of internal control

and internal audit system.

Redesigning authorization and application processes, introducing

workows.

Examples of Energy & Infrastructure projects


Service area
Japan Market Advancement
Support for Foreign Power
Generation Company

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| Ernst & Young Advisory

Description of main services


Assist foreign power generation companies in selecting Mega Solar
sites, modules, power conditioner, EPC and O&M company as well
as ling all the necessary applications to landowner, Electric Power
company and METI, and discussing and negotiating with them as
needed.

Smart Grid Business


Development for Electric
Power Company

Assist Electric Power company comprehensively in developing strategy


of smart grid business by setting business KPIs, building cyber security
platform, supporting application procedure for government subsidies,
proposing client care plans, etc.

Smart Grid Business


Development for Electric
Power Company

Assist local and regional government in propelling smart city business as


a facilitator and a project manager by coordinating relevant companies,
researchers, etc. to create a consortium and structuring and developing
an idea and a concept of smart city business.

Due Diligence of
Urban Planning and
Business Support

Assist local and regional city in recovering from natural disasters and
planning smart city project by researching and studying an economical,
social and cultural impact on the society, supporting local small/midsized companies and venture rms, and planning and arranging the
whole structure as a project manager.

Examples of Life science projects


Service area
Streamlining of sales and
marketing

Description of main services


Providing support for the following projects: (1) reallocation of MR
resources, (2) customer selection and segmentation, (3) promotion
mix and marketing processes, and (4) improvement of sales
performance assessments.
Conducting external stakeholder mapping and creating multi-

Organizational transformations

stakeholder strategies. Identifying the enabler and pivotal roles


inside companies that form cross-functional structure. Implementing
capacity development in all functional departments in order to execute
brand strategy.
Conduct program management, change management, and analysis on
internal communications and recommend an action plan.
Reducing costs by integrating a number of functions, such as sales

Cost-cutting

and marketing, transferring control of indirect operations to low-wage


regions or shared service centers.
Building practical target models as a guide for the restructuring of
companies.
Supporting clients in building their Standard Operating Procedures and

Internal controls

in providing related training and monitoring.

Reforming business processes while simultaneously improving

compliance .

Ernst & Young Advisory |

18

Our Industries

Our Industries

Healthcare

Financial

The environment surrounding medicine is becoming increasingly severe year after year, and the priority
issue seems to be stabilizing the management base for the future so that hospitals can consistently
provide the medical care that communities require. More specically, what hospitals need to do from now
on is to detect the main problems quickly and establish management improvement action rapidly. At Ernst
& Young Advisory we analyze customers' issues and problems and provide various timely and suitable
services toward realizing sustainable growth.

In the distribution of roles within a bank's tangled web of operations, application systems, and internal
related departments, a key issue for management is improved efciency with exibility, speed, and
adequate internal control. To achieve operational improvement and streamlining,
Ernst & Young Advisory provides advisory services related to organization, process and system
reconstruction while also supporting project management covering complex task dependence and related
external factors during installation of those new processes and systems.

Business areas and issues with which we can support

Business areas and issues with which we can support

Because the strategy for responding to changes in the medical environment is unclear, our client does
not fully understand the best direction for hospitals to follow in future.

Our client wants to check how its existing business will be impacted by new regulations and to
implement the required changes after efciently nding out what they are.

There is insufcient cash ow to enable capital investment required for rebuilding the hospital or
strengthening the management base.

Our client wants to efciently compile the operational requirements and system requirements
for installing a new system or reviewing an existing system based on demands and changes in the
nancial markets.

Our client is aware of the management problems but does not know how to take action on
improvement points, improvement measures, and implementation.

In a complex project that overlaps into multiple divisions or overseas ofces, our client wants to
efciently grasp the project progress and implement management.

Our main Healthcare services

Our main Financial services

Medical revenue improvement program

Income improvement support

Marketing enhancement strategy, main division enhancement strategy,


patient and revenue growth strategy
Cost reduction program
Proper employment costs, material costs and overhead costs, review of
commissioning, proper capital investment
Construction of management control system, cost price control &

Management control support

income control, BSC and target control


Strengthening of management control system, strengthening of cost
price control function, support for improved quality of medical care
Hands-on management support, organization and personnel system
improvement
Assigning management control specialists, reviewing various systems
to revitalize the organization.

Operational services

Consulting on the design and improvement of organizations and operations


Supporting the planning of operational analysis and design
Helping to dene operational requirements
Supporting the creation of a regulation response, provisions, etc.

IT related services

Consulting related to IT
Supporting the planning of systematization conception and design
planning
Dening requirements for systematization

Project management

We work in close cooperation on multiple projects and help with reporting


to the proper steering committee etc. and with quick and suitable
decision-making

Setting a future vision, basic plan, and design conditions

Facility redevelopment support

Creating a master plan, drawing up a business plan, reviewing facility


functions and construction costs
Support for divisional management plans and construction of medical
data system
Creating management plans for each division, supporting installation of
medical data system, drawing up outsourcing plan
Revitalization plans

Business revitalization support

Financial due diligence, business due diligence, drawing up a business


strategy, planning a revitalization scheme, studying nancial support
measures
Execution of revitalization
M&A support, securing personnel needed to run the hospital, project
control until the hospital opens

Examples of nancial projects


Response to the Basel Accords
Service area
Operational services

Survey and analysis of medical policy trends

Medical policy support

Survey of regional medical policies, various types of surveys for


medical treatment fee revision, support for high level medical
treatment and advanced medical treatment
Support for IT in medical treatment
Support for introducing various kinds of IT into hospitals and medical
related institutions in response to medical policy trends

IT related services

Project management

Description of main services


Supporting dening the requirements for risk control operations

stipulated in the Basel Accords and streamlining and upgrading of


operation.

Supporting system installation in response to the Basel Accords


Dening risk assets calculation / parameter estimation system
requirements.
UAT (system receipt and inspection) support.
Supporting package and vendor selection.
Overall implementation and control of projects related to the Basel

Accords.

Control of projects to install risk control systems.

Response to IFRS

Flow of services (Example of general model in management improvement)


Current analysis phase

Issue identication and


improvement proposal phase

Improvement execution phase

Marketing analysis

Issue identication by hearing

Study of management control tools

Financial and management resource analysis

Benchmark comparison analysis

Plan

Medical function analysis


Benet-risk analysis by department
Efciency and productivity analysis
Organization revitalization diagnosis
Management control system assessment

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| Ernst & Young Advisory

Service area
Operational services

IT related services
Do

Decision on improvement execution plan

Supporting new operational design resulting from IFRS.

Check

Monitoring done through actual


versus forecast management

Supporting systematization design planning.


Helping to dene systematization requirements.
Supporting package and vendor selection.

Verication of critical success factors


Formulation of action plan

Studying the impact on operations.

Studying the impact on related systems.

Issue identication
Action

Description of main services

Project management

Overall implementation and control of IFRS applications.


Individual project control.

Ernst & Young Advisory |

20

Our Industries

Our Industries

Automotive

Real Estate

The environment of the automotive industry has changed greatly due to the nancial crisis triggered by
the bankruptcy of Lehman Brothers in the fall of 2008 and the Great East Japan Earthquake and severe
ooding in Thailand in 2011. Complex and diverse key issues need to be addressed if growth is to be
achieved with the industry in the future. These issues include improving protability in Japan's domestic
market, which has matured due to its aging population and the younger generations' movement away from
cars, and corporate reorganizations on a global scale in line with their overseas expansion into emerging
markets, particularly China and India. There is the issue of developing new technologies to cope with
increases in oil prices and regulations on CO2 emissions.
Ernst & Young Advisory provides services which help companies in the automotive industry resolve the
business issues they face and to improve the actual processes used for operating the company. The
services range from establishing a corporate vision and strategy to enhancing the base on which the
company is managed so as to realize them this base being specically its human resources, organization,
business processes and information systems.

Markets are becoming increasingly diversied and advanced, seen in things such as Asian market
penetration, property intensication into companies with specialized skills, and the creation of new
business categories. Maintaining a competitive edge therefore requires an operational infrastructure
that can respond exibly and quickly and a data gathering and utilization infrastructure that enables
proposal-based control. While taking into consideration the customer's mission and strategy, Ernst &
Young Advisory approaches this task from two angles, operations and IT, in order to create a management
strategy.

Business areas and issues with which we can support


The company nds it difcult to gather the data needed for protability management by segment on
a global group level. A business management platform is needed which enables timely and accurate
information for decision-making.
Our client has difculty improving protability just from operations focusing on new car sales. Our
client wants to reform its dealerships' overall business, including after sales services such as parts
sales and repairs.
The company conducts a country-wide program and multiple related projects simultaneously but
nds it difcult to manage projects. Projects need to be managed based on practical and effective
project management methodology.

Business areas and issues with which we can support


Our client cannot conduct adequate property income analysis due to variations in the accuracy and
grade of collected data. Our client wants to construct a management infrastructure that enables
prompt action.
Front operations such as estimates and agreements and back ofce operations such as receipts and
payments and account processing are separated. Our client wants to construct an operational data
infrastructure that links them consistently.
Operations are dependent on individuals and the data infrastructure is obsolete. Our client wants
to construct an infrastructure that enables low cost operations and concentrate its resources on
its core operations.

Our main Real Estate services


Total system

We help to set up an earnings model with a lifecycle that also takes into
account operational income rather than just property sales. We also
support multiple analyses and simulations using management data.

Planning and Development

We support improvements to core operations such as planning, site


acquisition, and execution control. We also help to measure the nancial
impact that planning and site acquisition have on the company and gauge
the long term effect that such planning will have on the company.

Sales management

We support improvements to core operations such as order control,


funds management, and customer management. We also support
nancial aspects of operations such as customer targeting, effective and
efcient campaigns, nancial forecasting and nancial planning.

Asset management

We support the establishment of an operation infrastructure to maximize


cash ow and asset value. We also help to formulate operational cost
cutting measures based on benchmark data.

Property management

We help to formulate measures for increasing the acquisition of


properties in trust and strengthening leasing power. We also support
the establishment of an operation infrastructure that enables higher
operation quality and lower cost operations.

Building maintenance

We support improvements to core operations such as estimates,


agreements, work control, and billing and payment control. We also help
to switch to building management work including entrusted control work
and to formulate a human resource development plan.

Rent guarantee

We support improvements to core operations such as agreements,


credits and debts control, and arrears reminder control. We also help to
formulate a guaranteed product plan and a data utilization proposal.

Our main Automotive services


We support the transformation of consolidated business management
platform that can gather protability information by segment, such
Supporting consolidated business as by business line and by regional sector to achieve fast managerial
decision-making at a global level, and accurate by product protability
management
information on a consolidated basis for the planning and development of
new vehicles.

Supporting dealer management

Supporting business strategy


formation

As the sales volume of new vehicles in Japan continues to decline, we


support the improvement of a business management platform that
achieves not only the management of new vehicle sales but also including
after sales care such as parts sales and repairs, and help them streamline
their business process and reform their sales force operations.
In response to drastic changes in external circumstances, we provide
support for planning global level business strategy and regional strategy,
investment strategy toward the development of new technology, and
strategic alliances and M&A.

Supporting overseas expansion


(to emerging nations)

We help expansion in the emerging markets, such as BRICs and ASEAN


nations by supporting local market research, incorporation, and the
deployment of new business process and information system.

Supporting the formation of a


global supply chain

We provide support for building a globally evolved supply chain that links
completed vehicle manufacturers to parts and materials manufacturers,
and for developing the relevant business processes and information
systems.

IFRS deployment support

For investors to be able to make comparisons with overseas competitors,


IFRS based disclosure is required. We help our clients with the task of
converting from an existing accounting standard to IFRS and related IT
system.

In addition to the above services, we also provide other forms of support utilizing EY's global network.

Examples of Automotive projects


Service area

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| Ernst & Young Advisory

Description of main services

Consolidated business
management support

Supporting the improvement of a platform for managing by product


protability information on a consolidated basis. Revenue and cost data
of each product category (completed vehicles) are acquired from head
ofce, manufacturing subsidiaries and sales subsidiaries.

Overseas expansion support

Helping to draw up an accounting system deployment plan for


subsidiaries in the ASEAN region, and introducing the plan via our
umbrella company in the region.

IFRS introduction support

Support the conversion of Japanese accounting standard to IFRS with


the establishment of a group company accounting policy, assessment of
the change impact on business processes and information systems, and
its deployment to subsidiaries.

Real Estate
Management Solution
Conceptual Diagram

Management

Total system

Planning&Sales

Sales
management

Planning and
Development
Asset
management

Building
maintenance
Property
management

Core system

Operation

Rental
guarantee

BI system

Ernst & Young Advisory |

22

Our global network

Our global network

Global network service


EY seeks to provide consistently high quality services that meet the needs of companies, regulating
authorities, and investors worldwide in the globalizing market. To that end, we deploy international
business management under coherent management and governing structures, by integrating our member
rms in different countries into four areas to strengthen their collaboration.
Please refer to P.25 for EY member nation area.

Service which utilized the global network of EY

Japan Business Services

Our Japan Business Service1, a network of more than 350 Japanesespeaking professionals2 and 3,000-plus local professionals stationed
in more than 60 cities worldwide, seeks to liaise closely with Japanese
companies who are expanding their businesses oversea.
1The Japan Business Service (JBS) is a network governed by

ShinNihon LLC.

2Including Japanese secondees assigned overseas

To meet the needs specic to foreign companies who are expanding


their business in Japan, we leverage the global network of EY to provide
optimum services.
By utilizing the global network of EY, we can help to achieve smooth

Inbound Business Service

communication necessary when deploying client's global initiatives in


Japan.
Supporting project progress in accordance with head ofce vision and
strategy.
Supporting the assessment and decision making of solutions that are
harmonized with Japan-specic needs and global requirements.

Prompt and accurate communication achieved by bilingual professionals

who are skilled with various businesses and industries knowledge.

23

| Ernst & Young Advisory

Ernst & Young Advisory |

24

Outline

Ernst & Young


s global network and member nation areas
Japan area

7,000 people

EMEIA area

88,000 people

[Europe, Middle East, India and Africa]

Asia Pacic area

29,000 people

Americas area

51,000 people

JBS network1 hubs

Name

Ernst & Young Advisory Co., Ltd.

Business details

Advisory work to maintain and improve client performance,


such as:
Management consulting
Management diagnosis
Strategy planning
Alliances

As of June 2013

1 The Japan Business Service (JBS) is a network governed by ShinNihon LLC.

Business process consulting


Operational improvement
Organizational improvement
IT consulting
IT strategy
Project planning

Founded

November 1, 2010

Capital

450 million Japanese yen

Representatives

Chairman and representative director: Setsuo Kato


President and representative director: Haruhiko Matsui

Ofce

Head ofce:
Kasumigaseki Building, 29F, 3-2-5 Kasumigaseki,
Chiyoda-ku, Tokyo, Japan
Tel: +81 3 3503 1490 (main switchboard)
Fax: +81 3 3503 2818

URL

http://www.eyadvisory.co.jp
As of March 2014

London Amsterdam
Frankfurt
Luton
Reading
Brussel
Paris

Stockholm

Dusseldorf

Moscow
Warsaw
Vancouver
Seattle

Munich
Milan
Beijing Dalian
Seoul
Tianjin
New Delhi

Salt Lake City


San Francisco
San Jose
Los Angeles

Tokyo

Shanghai

Babgalore

Guangzhou Shenzhen
Ha Noi
Hong Kong
Yangon
Manila
Bangkok
Ho Chi Minh

Irvine

Dallas

Toronto
Boston
New York

Atlanta

Huston

Taipei
Mumbai

Kitchener
Chicago
Columbus

Honolulu

Mexico City

Saipan
Guam

Kuala Lumpur
Shingapore
Jakarta

Sao Paulo
Brisbane
Perth

Sydney

Buenos Aires

Melbourne

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Ernst & Young Advisory |

26

EY | Assurance | Tax | Transactions | Advisory


About EY
EY is a global leader in assurance, tax, transaction and advisory services.
The insights and quality services we deliver help build trust and confidence
in the capital markets and in economies the world over. We develop
outstanding leaders who team to deliver on our promises to all of our
stakeholders. In so doing, we play a critical role in building a better working
world for our people, for our clients and for our communities.
EY refers to the global organization, and may refer to one or more, of the member firms of Ernst &
Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK
company limited by guarantee, does not provide services to clients. For more information about our
organization, please visit ey.com.

About Ernst & Young Advisory Co., Ltd.


Ernst & Young Advisory is an EY member firm. Always present at the
front line of business change, our advisors use their expertise and a global
cooperative network so that they can provide a wide range of clients with
advisory services to enhance their businesses. In this way, we contribute to
building a better working world.
For more details, go to www.eyadvisory.co.jp.
2014 Ernst & Young Advisory LLC.
All Rights Reserved.
This material has been prepared for general informational purposes only and is not intended to be
relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific
advice.

2014.03.01

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