Hitachi Ltd and Microsoft Corp. have announced a strategic collaboration aimed at driving business and social innovation through generative AI. This three-year, multibillion-dollar partnership, revealed on June 3 in Redmond, Washington, and June 4 in Tokyo, promises to revolutionize industry solutions, with a strong emphasis on enhancing outcomes for both businesses and society.
As part of this agreement, Hitachi will integrate Microsoft’s cloud technologies, including Azure Open AI Service, Dynamics 365, Copilot for Microsoft 365, and GitHub Copilot, into its Lumada solutions. This integration is set to boost the growth of the Lumada business, with an ambitious revenue target of 2.65 trillion yen (18.9 billion USD) for FY2024, while also improving productivity across Hitachi Group’s 270,000 employees.
Keiji Kojima, President and CEO of Hitachi, expressed his enthusiasm for the collaboration: “Hitachi has been driving transformation by applying AI across the Hitachi Group to improve productivity and will invest 300 billion yen (2.1 billion USD) in GenAI to capture new growth opportunities in FY2024. Hitachi and Microsoft have already been working on a variety of co-creation projects including the development of next-generation digital solutions for the manufacturing and logistics fields and the development of a field-extended metaverse that runs on Microsoft Teams. Under this new agreement, we are excited to further accelerate social innovation by expanding our efforts to social infrastructure areas such as energy and mobility, and by applying generative AI, to improve the productivity of frontline workers, which will become even more important in the future. By combining our capabilities, we can help solve the issues faced by our customers and society, and contribute to a more sustainable future.”
Satya Nadella, Chairman and CEO of Microsoft, highlighted the transformative potential of the partnership: “We are entering a new era of AI with the promise to deliver transformative business outcomes across every role and industry. Our expanded partnership with Hitachi will bring together the power of the Microsoft Cloud — including Microsoft Copilot — with Hitachi’s industry expertise to improve the productivity of 270,000 Hitachi employees and help address customers’ biggest challenges, including sustainability.”
Enhancing Operational Efficiency
Hitachi’s Generative AI Center and Microsoft will collaborate to improve operational efficiency within the Hitachi Group. By leveraging Copilot for Microsoft 365 and GitHub Copilot, Hitachi aims to enhance its customer service and streamline mission-critical system development. An internal validation by Hitachi revealed that integrating detailed system design knowledge with Microsoft Azure OpenAI Service and GitHub Copilot could generate high-quality application source code 70% to 90% of the time.
In the rail sector, Hitachi Rail is utilizing generative AI for predictive maintenance, improving equipment monitoring and forecast accuracy. A cloud-based platform on Microsoft Azure is being used to streamline data visualization and analysis, providing data-driven insights for the maintenance of rail infrastructure, which is crucial for Network Rail’s decision-making processes.
Innovative Digital Solutions
Hitachi is also enhancing its Lumada solutions by incorporating generative AI capabilities. Microsoft’s Generative AI is being used for JP1 Cloud Services, which helps improve operational efficiencies for IT departments, financial institutions, and public organizations. A recent internal test showed that response times to alerts were reduced by approximately one-third when using generated AI.
Furthermore, Hitachi and Microsoft will collaborate to support the energy transition, focusing on digital solutions for asset performance management, energy trading, and risk management. This partnership aims to reduce downtime and increase profitability, leveraging Hitachi Energy’s Enterprise Software Solutions and Microsoft’s cloud infrastructure.
Sustainable Growth and Talent Development
In an effort to promote sustainable growth, Hitachi and Microsoft will undertake joint projects to enhance cloud services, improve security, and mitigate the environmental impact of data centers. A notable project includes reducing CO2 emissions from AI operations, starting with a data center initiative in Europe.
Additionally, Hitachi plans to train over 50,000 “GenAI Professionals” to acquire advanced AI skills. This training will incorporate Microsoft’s programs, including GitHub Copilot and Azure OpenAI Service, to ensure that these professionals are well-equipped to support AI-driven transformations for customers.
This landmark partnership between Hitachi and Microsoft underscores a shared vision of leveraging AI to foster innovation, enhance productivity, and contribute to a sustainable future.