Now Truly Independent, OM System Wants to Be More Competitive

When Olympus’s imaging business was spun off to form OM Digital Solutions, it did so under the investment of private equity firm Japan Industrial Partners (JIP). But in April, CEO Shigemi Sugimoto and the OM Digital Solutions management team purchased control of the company from JIP, which he says will allow them to be more competitive.

Speaking to PetaPixel in an exclusive, behind-closed-doors interview, Sugimoto-san says that de-coupling from private equity will allow the business the freedom it needs to invest in itself.

OM Digital Solutions has completed the acquisition of all shares, and the current management team, including myself, is now responsible for leading the company,” Sugimoto-san says. “This has enabled us to further strengthen the management foundation needed to fulfill our mission of enriching the lives of people across the world. With a stronger long-term perspective, we are better positioned to drive our business forward and ensure the sustainable growth of our company.”

To clarify, JIP is no longer involved in the business at all.

“[Japan Industrial Partners] does not have a share. The management team has 100% of OM Digital Solutions shares,” Sugimoto-san clarifies.

In April, OM Digital Solutions noted that the change in its corporate structure and investors would allow it to be more agile, with the flexible decision making ability in place to strengthen the company’s management foundation. That is a rather broad statement, and PetaPixel was curious what that meant more specifically. As it turns out, Sugimoto-san expects to be able to invest in areas of the business that the previous corporate structure made difficult.

“To achieve sustainable business growth, we believe it is essential to invest not only in delivering short-term results, but also in technologies and manufacturing capabilities that will drive our future competitiveness. To support this, we have established a management structure that enables faster and more flexible decision making on mid- to long-term investments in new technologies, product development, and manufacturing,” he explains.

“For example, investment that previously required more cautious consideration under our former ownership of JIP can now be evaluated and executed more quickly from a long-term management perspective.”

Sugimoto-san’s explanation tracks with how private equity tends to handle its investments: tight margins, with as little spent on the business as possible. That might explain why OM System’s last several camera releases have relied heavily on existing technologies. Before now, JIP likely wasn’t willing to accept the investment or risk associated with real, meaningful research and development.

“This allows us to steadily advance initiatives that will strengthen our future competitiveness, including the development of new technologies and products, the enhancement of product features, and continued investment in our manufacturing capabilities,” Sugimoto-san continues.

“In addition, we have strengthened the financial foundation needed to support our future growth by gaining greater flexibility in our capital strategy. This provides an environment in which we can make well-planned, long-term investment that supports the company’s sustainable growth.”

In that same vein, photographers have noticed that Micro Four Thirds sensor development seems to have stagnated.

“So the image sensor used in the OM-1 series and the OM-3 series offers an excellent balance between resolution and read-out speed, as you know. So we believe it is an optimal choice for our current product concept in enabling advanced Computational Photography features as well as fast and responsive operation during both shooting and playback,” Kazuhiro Togashi Senior Vice President, Global Brand and Marketing Strategy, OM System Business Unit says.

“At the same time, we recognize the customers have a variety of expectations regarding image sensor performance, including higher resolution. So to meet those expectations, we continue to explore new technologies, including new image sensors and engines.”