Inside Hitachi’s Restructure for the Physical AI Revolution

Hitachi is undertaking a significant organisational overhaul as the multinational conglomerate accelerates its transition into a "digital-centric company" under its Inspire 2027 management plans.

The restructure strengthens the company's operational framework to align with shifting global macroeconomic conditions while intensifying its commitment to Lumada 3.0, the latest iteration of its digital solutions platform, increasingly centred on physical AI.

The organisation has positioned physical AI as the next stage in artificial intelligence evolution. Hitachi aims to become the "world's leading practitioner of physical AI" by combining Information Technology (IT), Operational Technology (OT), products and its "customer zero" ecosystem, where solutions undergo testing within its own business divisions.

"This strategic evolution is designed to strengthen our foundations for sustainable growth and accelerate our Lumada Business, particularly through physical AI," explains Toshiaki Tokunaga, President and CEO of Hitachi.

"The rapid evolution of AI, from generative to agentic and now physical AI, combined with shifting global policies, defines our dynamic business landscape. As we enter the second year of our Inspire 2027 strategy, this new structure enables us to respond with even greater strength, leveraging the collective power of our IT, OT and product capabilities as One Hitachi."

Reorganisation supports Lumada 3.0 development

Central to the restructure is the reorganisation of the Connective Industries Sector. Noriharu Amiya, Senior Vice President and Executive Officer, has been named CEO of the sector, with the existing three Business Units (BU) being reshaped to enhance Lumada 3.0 development.

The company is establishing a new Industrial Products BU to concentrate on high-demand markets where Hitachi can cultivate leadership positions, directing resources towards product development and driving growth across Lumada 3.0's digital capabilities.

A second division, the Industrial Solutions BU, transforms physical AI innovations into digital services while expanding the reach of HMAX by Hitachi, an AI-powered solutions portfolio for social infrastructure that has secured considerable momentum in mobility and energy markets.

The third unit, the Urban Solutions & Services BU, focuses on rapidly expanding mission-critical sectors including semiconductor manufacturing and data centres, consolidating capabilities from related group companies to capitalise on expansion opportunities driven by AI infrastructure demands.

Digital integration across business units

The Digital Systems & Services Sector is being restructured to prioritise digitalisation of OT and products businesses throughout the group.

The industrial Digital Transformation (DX) division is being combined with the Social Infrastructure Systems BU and Financial Institutions BU to form the Digital Services BU. This division provides AI-based front engineering, system integration and digital services across energy, telecommunications, transport, industry, public services and finance.

Senior Vice President Katsuya Nagano and Vice President Yasuki Imai lead the unit, bringing substantial experience in enterprise-level digital transformation.

Concurrently, Hitachi is merging two digital subsidiaries, GlobalLogic and Hitachi Digital Services, to strengthen its comprehensive digital delivery capabilities, linking chip-to-cloud software development with mission-critical system integration and AI deployment.

Strategic leadership appointments

Hitachi is creating a new Corporate Strategy Group reporting to CFO Tomomi Kato, overseeing corporate strategy, government relations, brand communications and investor relations. The initiative is intended to "turn environmental changes into growth opportunities" while sharpening emphasis on capital allocation and portfolio transformation.

Acknowledging the increasing influence of international policy developments, Hitachi has appointed Hirohide Hirai to the newly-established position of Chief Government and External Relations Officer (CGRO). Hirohide coordinates across Hitachi's business units and six strategic regions: the Americas, Europe, the Middle East and Africa (EMEA), Asia-Pacific (APAC), India, China and Japan.

Senior Vice President Masahiko Hasegawa has assumed a new group-level position as Head of Regional Strategies, directing cross-group regional expansion and aligning initiatives to deliver unified customer value across markets.

To accelerate AI adoption and strengthen cybersecurity, Hitachi has promoted Satoko Fujimori to Chief Digital & Security Officer (CD&SO). Satoko previously headed the AI & Software Services BU and now drives AI transformation and security improvements across the organisation.

"I am confident this strategic alignment will further advance our transformation into a digital-centric organisation," adds Toshiaki.