The main focus and aims of our research and development activities over the last fiscal year will remain in place for 2008/2009. In recent years, we have established ourselves as a leading innovator in many areas such as software suites and intelligent deposit (Glossary)  and in doing so have gradually strengthened our market position. In order to maintain and build on this position, we intend to make further sustained investments in our research and development activities during the course of the current fiscal year. Our aim is to boost investment by at least as much as the increase in net sales. Our aim is to maintain an R&D ratio of 4.5%.

In line with recent years, we anticipate that around one in ten Group employees will be assigned to development tasks. At the same time, we shall continue to implement the internal initiatives we have launched to enhance the qualifications of R&D staff.

Our development work will continue to focus on the following key areas:

• further advances in the convergent base technologies that can be used as components for the optimization of both banking and retail processes
• improvements to the serviceability (Glossary)  of our hardware and software to reduce the cost to customers of running our solutions (Glossary) 
• software as the key to optimizing the overall process chains that characterize the branch operations of retail banks and retailers

We aim to create a global network in research and development along the lines of our production network. This will allow us to achieve maximum progress in development using the best available knowledge at the lowest possible cost. To this end, in fiscal 2008/2009 we intend to intensify our links with external development partners and research institutes both in Europe and overseas. At the same time, we shall further expand our development capacity at both our sites in Singapore and Shanghai and systematically examine ways in which we can optimize our research development work across the Group.

With the help of a process management system, we are continuously enhancing the effectiveness of our research and development activities. In fiscal 2008/2009, we shall place even greater emphasis on projects that drive forward our innovation strategy, Group-wide technology architecture, global development network and process improvements.