Innovation happens when organisations move beyond prediction to prescription - using AI not just to foresee challenges, but to solve them in real time.
Q1: Being associated with Hitachi for nearly 2 decades, how do you see the evolution of the organization from a provider of traditional IT, and infrastructure services, to digital services? What major organizational shifts/ restructuring (2-3) did you witness that helped the company prepare for the future?
The evolution to a digital services provider was a natural response to the shifts taking place in the marketplace. It also reflected demands from our customers and the market at large for Hitachi Digital services to deliver the same quality solutions the market has grown to expect from Hitachi. A number of organizational changes helped HDS prepare for the future:
- Vertical alignment of services and solutions. This shift helped HDS build and deploy solutions that addressed key business challenges in chosen verticals. Which in turn afforded HDS the opportunity to truly impact customers’ business outcomes and deliver measurable business results
- A one Hitachi approach to the marketplace that enabled HDS to bring the power of Hitachi to our customers. This shift was instrumental to better serve our customers both from a skillset standpoint as well as bringing real life use cases of how digital solutions impacted Hitachi’s internal business. We basically drank our own cool aid.
- Leadership and people. As we moved more to a digital services company, our leadership changed. Leaders from the digital industry were onboarded. The crafted a strategy that better aligned our solutions and services to the marketplace. They also changed the structure of the organization to be able to better deliver business outcomes to our customers. The type of resources and human capital brought onboard changed as well. As we became laser focused on digital solutions, we better understood what types of skills are need to deliver successfully to our customers.
Q2: Could you take us through your professional journey with Hitachi? How has been the transition for you from Hitachi Vantara to Hitachi Digital Services? What changed from an operating model, and services delivery perspective? How did that reshape your priorities as a leader?
My professional journey with Hitachi has been very gratifying. Especially seeing the various evolutionary cycles of the company. As the company made a strategic decision to focus its
investment and market facing activities on digital, the company consolidated its infrastructure services business with its professional services organization. That certainly brought specific synergies to the marketplace. But it became clear that the market and more specifically, our customers saw those 2 lines of business as separate and non-complementary. As such, Hitachi Digital Services was born. Hitachi Digital services became sharply focused on providing solutions and services that had great impact on the business outcomes of our customers.
Which mandated that we understand the business of our customers at a much deeper level. As such, and from an operation model standpoint, we vertically organized to focus on certain industries. That focus spanned the entire organization from how we face the customers, to how we innovate and solution, to how we deliver, to how we maintain and support. As a leader in the organization, we shifted our focus to a smaller set of solutions and services that were focused on vertical capabilities and solved for specific business problems within chosen verticals. We also had to build a team of experts that has deep expertise in the verticals we chose.
Q3: Please highlight the top three factors that are reshaping/ will reshape the automotive sector technology spending in 2025? How are you preparing to cater to clients with shifting priorities of automotive OEMs toward hybrid, and potential softening of spending in the sector?
- Integration of emerging and advanced technologies. The Automotive industry has been in constant disruption for a number of years. Those disruptions include supply chain, customer experience, new business models, government and regulatory to name just a few. The most recent set of disruptions come from emerging and advanced technologies. The incorporation of artificial intelligence (AI), autonomous driving
systems, and connected vehicle technologies is reshaping the automotive landscape. Companies are allocating substantial resources to develop and implement these technologies, enhancing vehicle safety, performance, and improve customer experience.
- Power train advances. The transition to electrification and hybrid power trains has had direct impact on almost every facet of the OEMs operations. From having to adapt their supply chains to attain raw materials for batteries, to changes to their manufacturing operations, to changes to their labor mix to incorporate digitally skilled workers, to adapting their dealer networks to a new way of selling and servicing vehicles, as well as having to comply with more stringent environmental regulations, to name a few. All this has forced many OEMs, if not most, to move from being vertically isolated to vertically integrated structures. Where there is significantly more collaboration between the various business units that make up their business
- Supply chain disruptions. You cannot really discuss the automotive industry without focusing on supply chain and to a certain degree, manufacturing. Disruptions in chip supplies, metals, and certain chemical components for battery production cost the industry billions of dollars in lost revenue over the past few years. Also, many OEMs are having to focus on deriving intelligence out of their manufacturing operations to better understand efficiencies\s they should realize and changes they should make to their manufacturing operations. To deal with all of this, most OEMs are investing heavily in supply chain technologies as well as adoption of smart manufacturing and industry 4.0 standards.
As one of the largest non OEM Automotive producst and services providers in the industry, Hitachi is uniquely positioned to provide a set of products, services and solutions to address many of those disruptions. Hitachi’s suite of Automotive solutions such as, Line Automation and digital twin for manufacturing, Gen Ai based fleet management, AI integrated predictive quality, H4Auto a preconfigured solution core for SAP, GenAi based HMAX line breakage solution, which is a collaboration with Nvidia, Hitachi’s prescriptive maintenance solution and many others. Many of these solutions have been developed for internal consumption at Hitachi. After being deployed internally and business benefits were proven, Hitachi externalized the solutions to our customers and the marketplace.
Q4: Given the automotive industry stands on the cusp of a major transformation to accommodate the shift towards SDV, EVs, and integrate and assess AI’s impact, how are you preparing for this strategic shift?
I would argue that the transformation to integrate many emerging technologies such as SDV, EVs and AI has been in process and many OEMs have adapted and invested to take advantage of such technologies and in certain cases get ahead. Hitachi is uniquely positioned to lead our customers through that process. Hitachi’s in cabin design capabilities help our customers better design better product by utilizing AI to understand user preferences and behaviours in a more meaningful way. Our connected services and solutions help our customers utilize emerging technologies more effectively, specifically we helped one the largest OEMs centralize their OTA solution to a single ECU in vehicle that then propagates software updates to other ECUs. To ensure standardization, we strongly believe that a Software Centric architecture is need, Hitachi developed HFusion as a standard architecture and methodology bringing the most advanced patterns of software development to bare and integrating that with the latest DevOps standards. We also believe that a data platform is a must in order for the above mentioned technological advances to deliver business value. As such, Hitachi partners with the major hyper scalers and has built data platforms to ensure well structured and clean data is available. There are also a number of areas that Hitachi has developed solutions that will enable our customers success. Those include :
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- Battery technology. Developing battery passports, battery cost models, predictive quality models, traceability of raw materials as well as battery recycling and reuse
- Charging infrastructure. This includes full blown and mobile charging stations
- Sustainability solutions. As one of the top sustainability solution providers, Hitachi has developed a number of solutions specific to the Automotive industry, including battery specific solutions, Green data center solutions as well as carbon neutrality solutions
Q5: What has changed in your IT-OT integration approach and delivery with the onset of Gen-AI? Does AI/Gen-AI lead to better client impact and outcomes in terms of cost reduction, enhancing operational efficiency, improving RoI, etc.? Are there client case examples to support?
What made IT-OT integration especially complex is that they had to bridge the digital and
physical. Hitachi pioneered many of the solutions that enabled such integration and developed use cases that delivered business value to our customers. Such use cases focused on the concept of “prescriptive’ not just ‘predictive”. Solutions that focused on prescriptive maintenance, were we create maintenance envelopes detailing the steps to be taken to solve maintenance issues, to prescriptive quality, identifying root causes behind quality issues and providing concrete steps on solving those issues. We have integrated GenAi models and patterns into our solutions so as to be able to process massive amounts of data and derive intelligence out of the data. By integrating AI into our IoT solutions to predict and prevent equipment failures on production lines, we have helped our customers reduce cost, enhance operational efficiency, and improve ROI by deploying integrated resource allocation models and discovering new business models
Q6: With rising digitalization across the automotive value chain, how do you address IT-OT security vulnerabilities and compliance for your automotive sector clients?
Hitachi offers a number of services that help our customers navigate the ever changing security ecosystem in automotive. Those services include the definition of a unified security platform
that spans IT and OT systems and Asset discover and risk assessment. Hitachi puts special emphasis on end point security, OTA security, Supply chain security, especially protecting against cascading vulnerabilities caused by supplier system vulnerabilities, threat detection caused by emerging technologies such as SDV and GenAi. We also work with our customers on ensuring they comply with the various security standards in the Automotive industry including ISO/SAE 21434, GDPR and others
