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2. Management Policies

(1) Basic policy on management

Our company, as a general facility job execution company, pursues a basic management policy of contributing to society by offering a safe and easy to use, high quality environment by technology which contributes to environmental preservation. Under such a management policy, in order to survive severe, selective times, the company aims to display creativity, to reinforce its technical and sales strengths and become a vigorous company. As a management index, we aim for a capital stock profit rate of more than 5%.

(2) Basic policy on distribution of profits

Our basic policy will be to return profits stably and continuously to our shareholders.

(3) Corporate governance

In or to respond immediately to rapidly changing management environment, in the management discussion meetings, appropriate countermeasures for important management topics are investigated speedily, the concerned persons are asked to attend when necessary, and implementation policies are decided upon. At the same time, proposals are made to the board of directors' meeting, thereby aiming to activate the board of directors. The auditors hold their meeting before the meeting of the board of directors' is held, and confirm the items to be discussed by the board of directors and present the opinions of the auditors' meeting to the board of directors. This has become and established practice. Furthermore, to unify the business and affairs of the entire company, a branch office managers' meeting is being held every month, where not only management measures are explained but various problems in branch offices are discussed to solve them as soon as quickly.

(4) Management strategy for the mid and long term

The first year of a mid term management plan, "Challenge NEW DAIDAN 100", which has been carried out since April 2000, has passed. Concrete measures are being promoted in each department as follows:
  1. Sales aspects
    Regarding the open network systems and the clean technologies represented by electronic device industries, and biotechnology industries, we are promoting a new sales actively using a new organization encompassing all steps from order acceptance to work execution and maintenance. We are strongly promoting proposal-making type of sales activities that suggest new development technologies or improvement of existing technologies not only in the fields of cogeneration and IT related industries, in addition, of course to the fields of medical, pharmaceutical, food products, which are the fields of our expertise.
    In addition, we are actively promoting measures to increase orders of renewal construction, making good use of practices for many years.
  2. Development technology aspects
    In order to support sales activities that propose technologies to suit the needs of the customers, we are pursuing research and development to realize new technologies and cost reduction.
  3. Work execution technology aspects
    We are continuing to offer facilities with not only high quality but also high cost performance by fully utilizing our work execution technology that we have accumulated over a hundred years of our experience.
  4. Information Technology (IT) aspects
    We are re-building the information system in the entire company in order to achieve high efficiency and high speed of operations by having an organization in which that reduces the management costs and strengthens further the management of profits, and also by integrating the indirect operations departments. To proceed with these successfully, we have established an IT promoting department.
  5. ISO
    We are now making effort to acquire the ISO 14001 certification for our environmental management system by November 2001. In addition, we are also carrying out the work of making the year 2000 update even for the ISO 9000 series certification that we have already obtained.
  6. Personnel aspects
    We are activating our organizations by introducing "competency evaluation" in addition to "target management evaluation" in order to establish result-based performance remuneration, and to achieve effective utilization of the personnel.
In addition to implementing the above type of measures in a concrete manner, the entire company is working together to improve the corporate performance towards March 2003 when our company will be celebrating our hundredth anniversary.

(5) Others

The tasks that we need to carry out from now on are making our crisis management thorough, strengthen our compliance, and aim at a company that is more active.

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|Brief Report(Consolidated)|

Copyright 2004 DAI-DAN Co.,Ltd.