Fujitsu Ltd hopes to more than double its sales in five years in China, through a consolidation of its 39 operations in its most important overseas market, said a top executive with the Japanese technology giant.

Hiroaki Kurokawa, president and representative director of Fujitsu, said sales from China will rise from the current 24 billion yuan (US$3 billion) to 60 billion yuan (US$7.6 billion) in 2010.

The key to that growth won''t be more offices or staff, but uniting the many subsidiaries the company has scattered around the country.

"This year is the beginning of our new reform," said Kurokawa in an interview in Nanjing.

Since taking over the world''s third largest technology service provider after IBM and EDS in 2003, Kurokawa''s first job was to bring Fujitsu''s loss-making businesses in Japan into profitability.

In Fujitsu''s first fiscal half ending in September, the company booked operating income of US$469 million in Japan, an increase of 14 per cent year-on-year, according to its financial results released on October 26.

But the firm is still struggling with a slowdown in its home market, meaning the focus of its new wave of reform is in overseas expansion.

In the first fiscal half, Fujitsu''s net sales from overseas operations rose by 18.5 per cent. Net sales in Japan grew by just 4.4 per cent over the same period.

In June, Fujitsu decided to set up overseas groups in China, the Americas, Europe, and Asia in an attempt to grow sales of the four regions from the current 30 per cent to 50 per cent in 2010.

Haruhito Takeda, president of Fujitsu China, said his company has maintained an annual average growth rate of 25 per cent since 2001. With China''s increasing demand for technology services, he said, keeping a similar growth rate is possible.

However, severe challenges are still ahead for the biggest Japanese technology service provider.

One is intense competition. Almost all of the top 10 technology consulting and service providers in the world, including IBM, EDS, HP Services, and Accenture, are targeting China as a growth market, meaning Fujitsu will have its work cut out for it to stay on top.

Another issue is the highly fragmented system of subsidiaries the company has in China.

Currently, the firm has more than 18,000 employees, most of whom works at its semiconductor or electronic device factories, working at 39 different subsidiaries and reporting to different departments in the Tokyo headquarters.

What is even more challenging is that Fujitsu China has about 1,500 technology service engineers scattered in different locations in Beijing, Shanghai, Fuzhou, Nanjing and Xi''an.

These separate companies make consolidation a pressing issue for Fujitsu.

"Now we have guidelines, but to execute (the plan) is much more difficult," Takeda said.

He said Fujitsu China is working on a three-year plan from next year to 2009 to integrate the staff and resources of its subsidiaries.

"Everybody knows we can compete against IBM for large clients, which usually require several hundred or over 1,000 people," Takeda said. "But we are weak and scattered, so we must unite."

Fujitsu China now has only one legal professional, but it will soon establish a legal affairs department with legal experts from Japan and China to discuss how to combine resources from different subsidiaries. -China Daily