Fujitsu Enhances Business Continuity Management in Procurement

Tokyo, August 21, 2007

Fujitsu Limited today announced enhanced initiatives to ensure the stable provision of its products and services by strengthening the business continuity capabilities of its suppliers in the event of natural disasters or other contingencies. In addition to evaluating the business continuity capabilities of suppliers with its proprietary assessment model, based on those evaluations Fujitsu will also help suppliers reinforce their business continuity readiness, thereby enhancing the continuity of its own supply chain.

Fujitsu's proprietary assessment model and support methods were jointly developed by its procurement unit and the Fujitsu Research Institute (FRI) based on practical experience gained in deploying Fujitsu's own Fujitsu's Business Continuity Management (BCM) practices.

FRI will begin offering a Supply Chain Continuity Assessment service in the second half of fiscal 2007. This service will identify potential supply chain problems arising from contingencies and evaluate various countermeasures.

Companies increasingly are making efforts to develop Business Continuity Plans (BCPs) to prepare for earthquakes, storms, and other contingencies. But individual companies setting up their own BCPs in isolation leave open the possibility of vulnerability in the supply chain sending their plans awry. If the supply of a key part is halted by a vendor hit by disaster, provision of the end-product or service will immediately grind to a halt. With the increasing complexity and geographic dispersion of supply chains, they are all the more vulnerable to interruption. Accordingly, what is needed is the creation and maintenance of a BCP that encompasses the entire supply chain.

In September 2005, Fujitsu established an organization dedicated to promoting business continuity management. To improve its own business continuity, Fujitsu developed a BCP focusing on critical products and services. Its procurement unit also examined a wide range of issues affecting interactions with suppliers, especially with respect to quality and cost, engaging them in dialogue on these issues and pursuing continuous improvements to optimize procurement. In November 2006, Fujitsu began implementing questionnaire-based surveys of the BCM capabilities of its suppliers.

The company has since made the questionnaires more finely detailed, assessing the level of suppliers' BCM capabilities and continuity of supply (disaster response, recovery times, etc.) for critical components. Through these efforts, Fujitsu is now able to gauge at the individual component level how the business continuity capabilities of suppliers would affect the provision of its major products and services. As a result, should contingencies arise, it can generate a detailed assessment of the extent of potential impact on the provision of major products and services, and respond more quickly.

Furthermore, based on the know-how gained in this process, Fujitsu will provide various types of support to help suppliers shore up their business continuity capabilities, thereby helping to reinforce the continuity of its entire supply chain. This will include offering information on techniques for developing BCPs, information on supply chain assessment methods and models, as well as providing a "check-in" service that enables suppliers to confirm the status of their operations in the event of a disaster or other contingency. Fujitsu plans to offer these forms of assistance over ProcureMART⁽¹⁾, its EDI service for procurement.

In addition, from the latter half of fiscal 2007 FRI will begin offering to outside clients a Supply Chain Continuity Assessment service based on the assessment model developed for use with Fujitsu's suppliers. Leveraging the considerable practical experience of Fujitsu's own procurement unit, this service will include basic assessment of suppliers' business continuity⁽²⁾, individualized assessment of suppliers' business continuity⁽³⁾, and supply chain BCM consulting⁽⁴⁾, answering to the needs of clients' procurement departments seeking to improve business continuity.

Information systems have become a critical part of the infrastructure that supports modern society. Building on its business continuity management efforts to date, Fujitsu as a leading provider of information systems will continue to enhance its business continuity capabilities through initiatives to enhance the continuity of its supply chain. In so doing, the company will strive to fulfill its social responsibility through the continuous provision of products and services, even in the event of unanticipated circumstances.