A key technology solutions company in a global society where humans and machines co-create seamlessly: Defining the ideal corporate vision toward 2030, Nikon gradually advances its business diversification to achieve its vision.
The interview with Nikon’s CEO, Toshikazu Umatate at the CES last year outlined the strategies of Nikon, which has transformed itself into a company that supports multidisciplinary manufacturing based on opto-electronics and precision technologies going beyond the position as a conventional camera manufacturer.
It has been one year since the event last year, during which the company has focused on developing diverse technological solutions to accelerate humans and machines co-create seamlessly .
Continuing from last year, Nikon exhibited at the CES held in Las Vegas, U.S.A. On its 2024 theme, “Co-create seamlessly,” the company set up its exhibition booth with more advanced solutions building upon the previous year’s efforts. This year, let us dive into Nikon’s current strategic position, drawing insights from statements and interviews with Go Ichinose, the Next Generation Project Division Manager, and Muneaki Tokunari, Director, Executive Vice President and CFO.

Driving the Acceleration of Humans-Machines Co-Create seamlessly as a Leading Innovator

The Next Generation Project Division stands as a pivotal unit, playing a key technology solutions company in a global society where humans and machines co-create seamlessly. In this division, staff members are actively working on planning and research & development initiatives with the aim of commercialization, laying the foundation for future pillars of the company’s business.

Serving as the manager of this leading division, Ichinose has been engaged in the development of Robot vision within this division. The Robot vision system developed by Nikon sets a new kinetic vision standard, outperforming the human eye with its high-speed sensing system integrated with 2D/3D cameras and hand visions. These advanced technological solutions are capable of a range of operations, from picking up ultra-small parts and components to installing them onto moving objects, both swiftly and flexibly.
The plan is to integrate this system into Automatic Guided Vehicles (AGVs) that can drive autonomously positioning it as a cutting-edge solution in the fields of manufacturing and logistics. An even more advanced application of this system is its use in assistant robots that can be used in various aspects of people’s daily lives. Ichinose explains the Nikon’s perspective of this product currently under development with the aim of launching business based on this product in Japan within 2024, as follows:
“Robots available in the market today are basically designed to assist human operations and tasks by executing pre-installed actions. But our Robot vision currently under development is being equipped with a vision system that mimics the human eye, with the goal of surpassing the discernment and action capabilities of the human eye. Replacing human tasks flexibly can, of course, lead to reduced production costs. But we believe this system can bring about collaboration between humans and machines through co-creation, to the point that our Robot vision can make decisions and act based on its own judgment, rather than merely following one-way instructions from humans.”
Specializing in high-speed image processing technology, this robot’s technical strengths lie in its ability to make instant decisions and judgments. According to Ichinose, though, “the robot’s brain will require expanding its capabilities through various methods, including deep learning”. Such technical advancements will make a shift in robot utilization from manufacturing fields to more daily aspects of people’s lives, where responding to a wide array of challenges is necessary.

Management Strategies Integrating Sustainability and Growth

Nikon’s management strategy, which focuses on achieving both sustainability and growth, underlies a series of product developments aimed at reducing environmental impact while saving labor and increasing workplace efficiency.
This strategy has received international recognition, with Nikon being chosen for six consecutive years as a component stock in both the DJSI World and DJSI Asia Pacific categories of the Dow Jones Sustainability Indices, a family of benchmarks for ESG investment.
“Previously, ESG initiatives focused on a defensive approach, not harming the earth. But we are shifting toward an era of proactive sustainability, where environmental friendliness and growth strategies are synchronized. Although translating societal appreciation into tangible economic value may take time, we are confident that improving non-financial values will eventually lead to increasing financial enterprise value,” says Tokunari.
He assumed the role of Director, Executive Vice President and CFO in 2020. At that time, to formulate management strategies, he read through the “Nikon’s 100-year History,” which documents the company’s journey from its inception, covering every aspect of its history.
“Historically, Nikon has particularly focused on producing final products entirely in-house, from melting raw glass materials to manufacturing lenses for cameras and lithography systems. But we came to recognize that providing our technology and know-how to other companies can lead to spawning new business ventures and facilitating growth with our client companies. Motivated by this thought, we launched our Components Business, which impressively expanded its operating profit from 100 million yen in the fiscal year ended March 2021 to 12.7 billion yen by the fiscal year ended March 2022.”
One of the key examples Tokunari cites includes components related to EUV. Nikon has shared its technology and know-how expertise, accumulated through the experience of developing EUV lithography systems, with client company by offering them as components. The company’s medium-term management plan identifies the entire Components Business as a growth driver.
“We have set a goal to increase the sales profit ratio of services and components by more than 50%, in other words, higher than that of finished products, by the fiscal year 2030. This goal can’t be achieved solely by our efforts. Collaboration with startups and embracing open innovation are essential.”
In fact, Nikon actively engages in acquiring and investing in startups and other companies. The company has acquired a U.S.A. trusted leader in metal additive manufacturing (AM) specializing in AM and engineering for the aerospace, Morf3D, and a German metal 3D printer manufacturer, SLM Solutions Group AG (currently Nikon SLM Solutions AG), and invested in a French smart telescope manufacturer, Unistellar.
With Unistellar, for instance, going beyond mere business investment, Nikon jointly develops smart telescopes. The eVscope 2, their first jointly developed model, incorporates the electronic viewfinder (EVF) technology derived from Nikon’s Imaging Business into the telescope’s eyepiece, achieving clear and crisp visuals.

The report last year mentioned Nikon’s business structure reconstruction, encompassing finished products, services, and components, centered around the key concept “Ambidexterity.” What kind of challenges and solutions did the company face in practice?
In 2022, Nikon established its subsidiary named Nikon Creates Corporation, dedicated to the planning, shooting, and production of next-generation visual content. This venture is pioneering in virtual production techniques, which enable the integration of live objects with digital backdrops for real-time video creation, and it also engages in producing 3D/2D video and XR content. Tokunari recalls that the foundation for this innovative business actually originated within Nikon’s own Imaging Business Unit.
“We had small-scale initiatives related to the visual content business within the Imaging Business Unit. But we decided to further develop this business under the direct oversight of CEO after launching a new department, the Imaging Solution Development Department. The management based on ambidexterity requires achieving both exploration and exploitation. We came to realize that the seeds for new business ventures, which represent the forefront of exploration, actually existed within our own organization.”

How to Break Through the Monetization Barrier

As Nikon ventures into new businesses leveraging its longstanding expertise in opto-electronics and precision technologies , exemplified by Robot vision and Riblet Processing, the company now faces its next significant challenge.
“We have been examining a wide variety of solutions aimed at addressing diverse social needs and challenges, while finding numerous ideas within the company. However, the question of whether each solution can be monetized and turned into profit is another story. Within our company, we have set multiple project evaluation stages, and it is a fact that some projects fail to meet the monetization criteria. Such projects are then terminated. On the other hand, there are indeed unique ideas that are progressing towards commercial viability.”
Said Tokunari, highlighting NiLIMo as a prime example. This is a live monitoring system that employs AI and image analysis technology to detect early signs of calving in cows and notifies farmers. This project leverages Nikon’s accumulated expertise to support primary industry operations, closely engaging with producers and facilitating the digital transformation of the livestock sector. Following successful pilot tests, the system is now being applied to beef cattle, with plans to expand its use to dairy cattle and other livestock types.
Tokunari remarked, “I didn’t anticipate that monitoring calving in cows would become the application destination of the initiatives pursued by the Imaging Solution Development Department.” However, the application of imaging solutions has expanded well beyond not just NiLIMo. Moving forward, Nikon plans to leverage the technology and know-how accumulated through the engagement in the Imaging Business to address a wide array of challenges.
How does Ichinose, who leads the Next Generation Project Division, consider these challenges? Acknowledging what Tokunari stated, Ichinose adds the following complementary remark:
“The biggest challenge is discerning whether this project can truly be commercialized or not. Differing from the traditional Nikon approaches, now we are approaching customers not with finished products, but by consulting them in the initial stages to inquire, ‘Do you see a need for this technology?’ This approach initiates up a new process where projects are launched as business ventures only when they receive inquiries from many customers. Therefore, if we cannot secure a path to commercialization despite engaging in early-stage consultations, we surely end up disappointing customers. We clearly need to address such a dilemma as we adopt this approach.”
Listening to customers’ feedback from the early stages and integrating it into the product planning and development is the key to success. Interestingly, the development of Riblet Processing technology was also started through this approach. They approached to a diverse range of manufacturers, such as electronics, gas turbines, and aviation, in order to propose simulations. This strategy has enabled the company to kick-start ventures with minimal investment, gradually building up to tangible outcomes. Ichinose remarks on the importance of this process, as follows:
“I always keep in mind the notion that ‘Technology without needs is valueless.’ One time, I asked a startup CEO to evaluate a certain technology and made a presentation. This phrase was what I received at that time, which has continued to resonate with me ever since. This highlights the critical importance of soliciting customer feedback from the outset and ensuring that the technology we develop meets a genuine need.”

Digital Manufacturing Technology Supports the Era of Low-Volume, High-Variety Production

As a company undergoing transformation to support manufacturing across various domains, what visions does Nikon hold for the future of manufacturing? Last year, CEO Umatate envisioned an era where manufacturing transcends the boundaries of time and space. Following this vision, Ichinose adds the following remark:
“I believe that digitally designed data transfer will achieve manufacturing that goes beyond time and space. In such an era, what will be required on the manufacturing floor is the ability to discern on-site developments and execute swift, optimal actions. Remote instructions lose their significance if they fail to effectively achieve the intended purpose of the instructions in distant locations. This underscores the value of robots capable of making human-like judgments and performing tasks, like robot vision. Such robots, if available, can achieve manufacturing of high quality with ease even if those on-site personnel have no expertise.”
The shift towards such digital manufacturing, or digitalization of manufacturing, will facilitate the ability to produce in small quantities across a broad range of products, tailored to diverse needs. Tokunari articulates this transformation as follows:
“Manufacturing based on new ideas traditionally necessitated molds for casting. However, the additive processing technology can shape CAD-based designs directly by using optics and ranging technology. Additionally, the process only requires light and metal powder, eliminating the need for molds and reducing the environmental footprint. Nikon aspires to a future where human creativity and final products are seamlessly interconnected, fostering a collaborative future between humans and machines. We are committed to continuing our business ventures with this vision in mind.”
* Titles and product names are current as of January 2024.