CHAPTER 1: PROFILE OF THE COMPANY 1.

1 Company Profile

The company was originally named Seikikgaku kenkysho (jap. , Precision Optical Industry Co. Ltd.). In 1934 it produced the Kwanon, a prototype for Japans first-ever 35 mm camera with a focal plane based shutter. In 1947 the company name was changed to Canon Camera Co., Inc., shortened to Canon Inc. in 1969. Company Name Founded Headquarters Phone Chairman & CEO President & COO Common Stock Number of Employees Net Sales Canon Inc. August 10, 1937 30-2, Shimomaruko 3-chome, Ohta-ku, Tokyo 146-8501, Japan. (81) 3-3758-2111 Fujio Mitarai Tsuneji Uchida 174, 762 million yen (As of December 31, 2012) 25, 683 (As of December 31, 2012) Non-Consolidated 2, 025, 546 million yen (2012) Consolidated 3, 209, 201 million yen (2012) Non-Consolidated 80, 778 million yen (2012) Consolidated 131, 647 million yen (2012)

Net Income

198, 307 (2012) Ordinary Profit Table 1.0 Company Profile 1.2 History

1937 to 1970 The origins of Canon date back to the founding of Precision Optical Instruments Laboratory in Tokyo in 1937 by Takeshi Mitarai, Goro Yoshida, Saburo Uchida and Takeo Maeda. During its early years the company did not have any facilities to produce its own optical glass, and its first cameras incorporated Nikkor lenses from Nippon Kogaku K.K. (the later Nikon Corporation). Between 1933 and 1936 The Kwanon, a copy of the Leica design, Japans first 35 mm focal plane-shutter camera, was developed in prototype form. In 1940 Canon developed Japan's first indirect X-ray camera. Canon introduced a field zoom

lens for television broadcasting in 1958 and in 1959 introduced the Reflex Zoom 8, the worlds first movie camera with a zoom lens, and theCanonflex. In 1961 Canon introduced the Rangefinder camera, Canon 7, and 50mm 1:0.95 lens in a special bayonet mount. In 1964 Canon introduced the 'Canola 130', the first Japanese made 10-keycalculator, a substantial improvement on the design of the British Bell Punch company, which introduced the first fully electronic calculator two years earlier with the Sumlock Anita Mark 8 unit. In 1965 Canon introduced the Canon Pellix, a single lens reflex (SLR) camera with a semi-transparent stationary mirror which enabled the taking of pictures through the mirror. 1970 to 2010 In 1971 Canon introduced the F-1, a high-end SLR camera, and the FD lens range. In 1976 Canon launched the AE-1, the worlds first camera with an embedded microcomputer. In 1982 "Wildlife as Canon Sees It" print ads first appeared in National Geographic magazine. Canon introduced the worlds first Inkjet printer using bubble jet technology in 1985. Canon introduced Canon Electro-Optical System (EOS) in 1987, named after the goddess of the dawn. EOS 650 autofocus SLR camera is introduced. Also in 1987 the Canon Foundation was established. In 1988 Canon introduced 'Kyosei philosophy'. The EOS 1 Flagship Professional SLR line was launched in 1989. In the same year the EOS RT, the world's first AF SLR with a fixed, semi-transparent pellicle mirror, was unveiled. In 1992 Canon launched the EOS 5, the first-ever camera with eye-controlled AF, and the Power Shot 600, its first digital camera. In 1995 Canon introduced the first commercially available SLR lens with internal image stabilization, EF 75-300mm f/4-5.6 IS USM. EOS-1N RS, the world's fastest AF SLR camera with a continuous shooting speed of 10 frame/s at the time. Based on the EOS-1N, the EOS-1N RS has a fixed, semitransparent pellicle mirror with a hard coat. In 1996 Canon introduced a pocket-sized digital camera with the Advanced Photo System, named ELPH in America and IXUS in Europe. Canon entered the digital video camcorder market in 1997.

In 2004 Canon introduced the XEED SX50 LCD projector. Canon introduced its first high-definition video camcorder in 2005. In November 2009 Canon made a 730 million (US$1.1 billion) all-cash offer for the Dutch printer maker Oc. Canon had acquired majority ownership of Oc by March 2010, and completed the acquisition of 100% of shares in Oc by the end of 2011. 2010 to present In 2010 Canon acquired Tereck Office Solutions, Inc. On 16 March 2010, Canon announced that it was seeking to acquire a new .canon generic top-level domain. In the third quarter of 2012, Canon's global market share in the sale of printers, copiers and multifunction devices amounted to 20.90 percent. In early 2013, Canon USA moved into a new $500 million headquarters in Melville, New York.

CHAPTER 2: OBJECTIVE OF ASSIGNMENT: PRODUCT DESIGN 2.1 Goods and Services Selection In order to maximize the potential for success, Canon Company has tried to focus on some products which can generate better revenues and then concentrate on those products. For example, when consider the Canon EOS of Canon Company; it will put more efforts on the products which possess the high sales demand such as Canon EOS 500D, 550D, 600D, 60D, 7D, 5D, and 1D. This phenomenon does not mean that Canon is giving up other products like Canon EOS 350D, 450D, 20D and so on but it only limits the production of these products. By using cost-benefit principle, Canon is willing to invest more time and effort on those profitable products rather than those only generate moderate revenue. On the other hand, because most products have a limited and even predictable life cycle, Canon Company has constantly been looking for new products to design, develop, and take to market. For instance, Canon recently has introduced a few new products such as Canon EOS 1100D and Canon EOS 600D. As they know, external environment is keep on changing and full of uncertainty especially customer taste. Therefore, new products are produced to fulfill a variety of consumer demand. Besides that, in good operations management, operations managers should insist on strong communication among customer, product processes, and suppliers that results in high success rate for their new products. Canon Company is believed that they have done pretty well in this. In addition, Canon also has built competence in customizing an established family of goods or services. This approach not just allows the customer to choose product variations but also can reinforce the organizations strength. Canon does it fast because it understands that speed to market is imperative to obtain a competitive edge. Moreover, Canon must also plans carefully in selection of goods and services by evaluate product decision. The objective of the product decision is to develop and implement a product strategy that meets the demand of the marketplace. Moreover, the main purpose of product selection is choosing the good or service to provide consumers. Canon has put a lot of effort on differentiation on their products. This is because Canon realizes that the more distinct a product the more competitive advantages over others. Therefore, Canon differentiates itself by offering a distinctly

unique and high-quality product. For instance, Canon focuses on its product design in term of its function and layout which other companies could not imitate or produce. Lowcost strategy is also been used by Canon Company in order to maintain low-cost expenses while still can provide high quality and gain profit. In other words, Canon has developed a product line that is both low cost and high value and also high demand. Rapid response is also another strategy implemented by Canon due to changing of customers demand. The shorter the design time, the faster the product get into the market. This is because short design time allows Canon to get the products to market before consumer tastes change and to do so with the latest technology and innovations. Besides that, product life cycle plays the most important part in the selection of Canon products and services. Canon knows this concept well enough and so need to be able to design a system that helps introduce new product successfully. Canon also realizes that fail to perform this stage effectively may be the loser among the competitors. Canon should have a plan to develop strategies for new and existing products. This phenomenon becomes more complicated as strategies change when products move through their life cycle. As we know, a product life cycle consists of four phase which are introductory, growth, maturity, and decline. In introductory phase, Canon may use a lot of expenditures on doing research, product development, process modification and enhancement, and supplier development. Typically, company will has a negative cash flow while it develops a product. Next, Canon should begin to stabilize and forecasting of capacity requirements in the growth phase. In order to accommodate the increase in product demand, enhancing existing capacity may be necessary. When in maturity phase, high volume and innovative production may be appropriate. Canon must improve cost control, reduce the options, and pair down the product line to maximize profit since competitors have established. In the decline phase, products life cycle is come to the end. Therefore, Canon has to decide to terminate these entire poor products and start introduce new products unless these dying products still can be sold with unusually high contribution. Last but not least, Canon also evaluates possible strategies for each product by using product-by-value analysis. This analysis lists products in descending order of their individual dollar contribution to the firm, as well as the total annual dollar contribution of

the product. This analysis also can tell Canon management which product offerings should be eliminated or increased and which fail to justify further investment in research and development or capital equipment. Through this analysis, Canon can focus on the strategic direction for each product. 2.2 Generating New Product Every product must be weeded out and replaced no matter what the product is. It is because firms generate most of their revenue and profit from new product. In the camera industry, Canon was ranked the first highest in New Product Development. Moreover, Canon EOS series camera is the most innovative product among Canon cameras. From 1987 to 2011, Canons EOS has already released around 70 different kinds of camera. The earliest one is EOS DCS 3 released in July 1995 and the newest products are EOS 600D and EOS 1100D which are released in February 2011. This large amount product of Canons EOS indicate that the cycle of generating new product of Canons EOS series never stop working. The final purchase of product is made by customers. Hence, understanding the needs of customers is crucial for firms to conduct and control the process of generating new product. Only the product which is designed to satisfy customers need will be accepted by the market. As a leading brand for digital cameras, Canons EOS keeps renewing their cameras to meet customers different needs. For example, the EOS 60D, a new mid-range camera to replace the ageing EOS 50D, is designed to fit for the customer who want to a moderate size camera and this is the first EOS camera to feature a flip-out LCD screen. This innovation should very useful in Live View mode and when shooting video. Meanwhile, the ISO range, popup flash, lens and memory card have improved. Moreover, the price of new 60D sits comfortably between the EOS 70D at the high end and the EOS digital Rebel T2i at the low end. Moreover, Canon is well known the external economic environment. With the development of economic, people can afford more money for their camera hobby. In order to target different markets, Canons EOS develops four types of camera categories. There are entry levels, semi-professional, premium and professional cameras. These four different levels respectively focus on normal consumer, mid-range, high-end and flagship. In addition, because of technological change, Canons EOS can always generate

new product. The most advanced lens, system, and sensor and so on apply on EOS series let consumer pursuing EOS. New product is important to for a company. The higher the percentage of new products sales from the last 5 years, the more likely th e firm is to be a leader. According to a survey, 80% profit of Canons EOS is come from new products such as EOS 1100D, EOS 1000D and 60D. However, Canons Eos series also should accept risk and tolerate failure in the process of generating new product. In conclusion, Canons EOS is very sensitive to customers needs, economic change and technological change so that it successfully grasps the chance of generating new product. 2.3 Defining a Product In general, Canon EOS can be separated into Entry Level cameras, Semi-professional cameras, Premium cameras and Professional cameras. Entry Level cameras are specially produced for the new learner or the beginning users. Especially for those users that are totally never use it before. Semi-professional camera is specially designed for the beginners who are interested in upgrading into a better stage. While the Premium cameras and the Professional cameras are specially designed for the professional users. It usually used by the professional photographer and cameraman.

Here is the list of the Canon EOS production: Entry Level Cameras EOS 300D EOS 350D EOS 400D EOS 450D EOS 500D EOS 550D EOS 600D EOS 1000D EOS 1100D Semi-Professional Cameras EOS D30 EOS D60 EOS 10D EOS 20D EOS 20Da EOS 40D EOS 50D EOS 60D Premium Cameras EOS 7D EOS 5D EOS 5D Mark II Professional Cameras EOS-1D EOS-1Ds EOS-1D Mark II EOS-1Ds Mark II EOS-1D Mark II N EOS-1D Mark III EOS-1Ds Mark III EOS-1D Mark IV

Table 2.0 List of Canon EOS Production

The Entry Level EOS 1100D possessed a few features comparing with the previous Entry Level Canon EOS that allowing the beginners to prefer on it. EOS 1100D has a significantly larger screen, which is 2.7 of measurement on the screen. EOS 1100D also available to shots movies with 720p @ 30fps. This feature is a big improvement for the Canon EOS comparing to the previous version which is not available to shot movies. This latest version EOS also produce slightly lower noise art high ISO, which is 755 ISO. This is especially designed for the users who do not prefer higher level noise. The other features are included better maximum light sensitivity of 6400 ISO, high true resolution of 12.2 MP and slightly more dynamic range of 11EV. This latest version is also lighter in the sense of weight, which is 459g. While for the EOS 60D of semi-professional, its features included the resolution of 18.1 MP, manual control of audio recording, Wireless Speed lite control, external shutter release port changed from 'Canon N3' socket to 3/32"(2.5mm) TRS pin, etc. Besides, the premium cameras like EOS 5D also possessed some newer features. In example, movie recording in full HD at 1920x1080 and SDTV at 640x480 resolutions, HDMI video output for live preview or playing clips and images on an external monitor via type c MiniHDMI` port, dust reduction system to perform automatic sensor cleaning and etc.

2.4

Decision Tree

Generally, decision trees can be used for new-product decisions as well as for a other management problems. A Decision Trees consists of 3 types of nodes:1. Decision nodes commonly represented by squares 2. Chance nodes represented by circles 3. End nodes represented by triangles In order to focus on single production to maintain for the sales, we decide to cut off some of the current product lines. To choose whether which product will be remains in the market, we choose to calculate the profit via decision trees.

(RM) Selling Price EOS 4500 EOS 5500 1,500 2,500 Manufacturing Costs 1,000 1,800 Selling Units 10,000 10,000

Probability EOS 4500 EOS 5500 Fixed Cost: RM 1,000,000

Table 2.1 Calculation Method

High Sales 0.07 0.84

Low Sales 0.93 0.16

Decision Tree

Figure 2.0

Decision Tree

CHAPTER 3: IMPLEMENTATION OR THE PRACTICES BY THE COMPANY 3.1 i) Supporting Personal Growth and Skill Development Training System

To motivate employees and enhance skill specialization, Canon Inc. maintains an education system for rank based, elective and self-development training. Rank based training enhances knowledge and skills required for carrying out the duties of each pay grade, and fosters awareness of job responsibilities. Furthermore, general employees are also required to take business skills training as a supplement to rank based training. Elective training supports employees acquisition of knowledge and skills necessary for fulfilling their duties, and self-development training provides participants with knowledge and skills for their personal advancement. These training programs also cover such issues as harassment prevention and compliance in order to develop trustworthy employees.

Figure 3.0

Canon's Educational System

ii)

Supporting Employee Career Development

In recent years, Canon Inc. has worked to develop "strong individuals" and a "strong organization" by focusing on management-level employees through programs that include rank-based management training for all new managers. The Company is diversifying its training format and content through the active use of various e-learning training programs. Since 2005, Canon Inc. has also operated an internal career-matching system to support its employees in pursuing satisfying careers. The system aims to match the right people to the right jobs, promote internal mobility of human resources and bring greater vitality to the Company. Under this system, vacant and requested positions are continuously posted, and in-house career consultants conduct interviews that lead to increased awareness of career structuring. In 2011, 26 employees were transferred through this system. Moreover, Canon has since 2001 conducted an employee career support program known as My Career Course. This course stimulates self-initiative for growth by having each employee reconsider his or her own goals and life plan. Employees from a variety of Canon Group company fields, mostly in their 30s and 40s, attend this course. This course was held five times in 2011, at both the Mizonokuchi HRD Center in Kanagawa Prefecture and as part of the training camp held at the Fuji-Susono Research Park, in Shizuoka Prefecture.

Number of Employees Transferred through Career-Matching (Canon Inc.) 2007 2008 2009 2010 2011 Transfers using the career-matching system (general 61 47 40 17 26 employees only)
Table 3.0 Number of Employees Transferred through Career-Matching (Canon Inc.)

iii)

Cultivating Manufacturing Personnel

Canon pursues the sustainable development of global production systems as a manufacturer working in accord with the international community, and therefore seeks to foster human resources armed with superior skills and techniques at each production site. To meet the needs of expanding production, we are putting particular effort into humanresource development at our production sites outside Japan. The Manufacturing Training Center is at the core of this effort, and we continued to shore up our global manufacturing training structure in 2009, with training getting off to a full start in 2010. Our main strategy in 2011 was the development of key technicians and foremen at each production site, as well as the expansion and improvement of the training provided by onsite instructors. What this means in practice is that we conduct trainer development programs for technical/skill training, management training, and the development of instructors for onsite training , focusing mainly on plant managers and technicians at manufacturing companies in Southeast Asia and China. A total of 986 employees attended these courses. We have also established the Technical Skills Test Program at production sites with the goal of improving technical skill development. The Manufacturing Training Center has supported the establishment of this program at Canon Opto (Malaysia) Sdn. Bhd., Canon Hi-Tech (Thailand) Ltd. and Canon Vietnam Co., Ltd. The Center will continue providing support at more production sites to enable them to conduct the Skills Test Program.

Figure 3.1

Manufacturing Training Center training course participants

iv)

Development of Personnel with a Global Outlook

The globalization of Canon's operations is proceeding, reaching 280 operational sites worldwide as of the end of February 2012. Against this backdrop, one of the main strategies listed in Phase IV of Canon's Excellent Global Corporation Plan is the development of personnel befitting a global company. To this end, Canon is focusing on management-level employees in cultivating next-generation global leaders. We are also strengthening our training programs for younger employees so they can acquire early on the communications skills and cultural sensitivity that will serve them later on in overseas assignments.

v)

Tokyo Seminars Improve the Level of Management at Group Companies

Since 1980, Canon has invited management-level employees from Group companies around the world to the Tokyo Seminar. In addition to deepening their understanding of Canon and fostering exchanges among the participants, the seminar aims to enhance participants' awareness of their roles as Canon Group members and raise their level of management from a Group perspective. The 46th Tokyo Seminar was held in 2011, with 25 participants. A cumulative total of 1,028 employees have participated in the seminars so far.

vi)

Developing Next-Generation Management: the CCEDP

Canon launched the Canon Corporate Executive Development Program (CCEDP) in 2001 with the goal of developing the next generation of management with a global perspective. The CCEDP is an educational program for supporting the acquisition of management knowledge and skills and the creation of a global personnel network among our general manager class in Group companies worldwide. It has been convened five times so far, with a cumulative total of 87 participants.

vii)

Internationalization Training for Young Employees

Canon Inc. has established a system for employees to acquire language and international business skills through overseas work experience early in their careers. The Asia Trainee Program, which was launched in 1995, enables recruits who are 30 years old or younger to engage in practical study at local companies in Asia. After receiving five months of language training at university, the employees dispatched as trainees spend about one year gaining practical experience in sales, marketing, services, or production management/technology at an Asian affiliate. Every year about 10 employees participate in this program, with a cumulative total of 59 by the end of 2011. Trainees completing the program are employed at Asian affiliates. Canon Inc. has also instituted a similar system for technical employees, called the Overseas Study Program for Technicians. The program is intended to develop technicians who can function internationally, as well as enable them to acquire technologies that could become essential to Canon in the future. 70 employees have taken part in the program of overseas study at universities in the US and Europe since it was started in 1984. We increased the number of participants in this program to 11 in 2011, up from two or three in previous years, in line with the ongoing enhancement of our R&D structures in the US and Europe. From 2012 onward we plan to select 10 personnel for overseas study each year.

CHAPTER 4: RECOMMENDATION FOR IMPROVEMENT As the first quarter of 2013 draws to a close, one goal that many enterprises have for the rest of year particularly those that manually process invoices is to improve their accounts payable (AP) function. The key reason: now CFOs expect more than operational excellence from the AP function. Once considered a back-office cost center, AP has evolved into a strategic business enabler charged with helping to reduce costs, strengthen compliance and controls and ensure that payments are efficiently processed and reported. To accomplish these responsibilities, the AP function must streamline the invoice process, leverage new technology, and implement best practices such as outsourcing nonstrategic work and migrating from paper to digital workflow. Canon Business Process Services, Inc. spotlights three of these best practices to consider for 2013: a) Streamline the invoice process to reduce cycle time and cost When working with a service provider to improve the invoice process, the organization can begin by leveraging the providers experts to enhance the procure-topay (P2P) process. This includes centralizing the receipt of paper invoices and scanning them either in the companys locations or in the providers facilities. The provider should validate each invoice against the organizations master data to ensure that only valid invoices enter the organizations ERP system. This can significantly reduce the work associated with duplicate or invalid invoices.

b) Leverage automation to reduce errors, improve productivity, and lower cost One option with this best practice is to work with a service provider that offers standard and scalable invoice automation platform that can be integrated with virtually any ERP, ECM, and P2P system. Automating data capture/conversion, invoice validation and workflow can significantly reduce invoice processing time. Automation can also dramatically increase productivity from processing 1,000 to up to 10,000 invoices per AP worker per month.

c) Implement consistent workflow to improve compliance and controls This best practice helps ensure compliance with regulations such as Sarbanes Oxley. If deciding to team with a service provider, an organization should consider a partner that can implement consistent workflow processes designed to help maintain accurate records. By overcoming gaps in tracking, accessing, and updating data, such workflow processes help clients avoid compliance issues.

CHAPTER 5: CONCLUSION In general, I have gone through the Canon EOS by using the product design. However, there are several problems arisen from the report. Canon EOS has a various kind of products on the markets. To encounter with the problems, several solutions have introduced. As we know, Canon EOS has a various kind of products on the markets. To maintain its market, Canon needs a good revolution in future time. Also, the quality management has problems to encounter as well. Canon EOS has to produce the quality cameras to maintain its markets. The problems for location decisions and forecasting demand are almost the same, which are the weighting consideration and some accuracy of data. Canon EOS has a good maintained-trend in terms of quality for decades. Canon was awarded the MS ISO 9001 and 2000 standards in June 2002. This has proven the quality of Canon in the past few decades. Other awards are like the top 3 corporations awarded US patents, Platinum and Gold Readers digest awards, the winner for The 3rd Asia Pacific Super Excellent Brand-ELITE AWARD, the winner of The 7th Asia Pacific International Honesty Enterprise, the Brand Laureate award and Super-brand Status awarded in year 2002 back to back for few years later as well. Forecasting has been applied in the Canon report. Moving average forecast, exponential smoothing and linear regression has been well applied here. In short, product design and quality management are the right tools to evaluate Canon EOS.

REFERENCES Retrieved April 23, 2013 from Canon Global Official Website,

http://www.canon.com/ Retrieved April 24, 2013 from Canon Malaysia Official Website,

http://www.canon.com.my Retrieved April 24, 2013 from Canon EOS Digital Official Website,

http://www.canon.com/eos-d/ Retrieved April 25, 2013 from Wikipedia: Canon EOS,

http://en.wikipedia.org/wiki/Canon_EOS Retrieved April 26, 2013 from Canon EOS Digital Official Website

http://www.canon.com/csr/report/fa/01.html

APPENDIX