Chapter 02
TOP MESSAGE
Achieving Our 2030 Vision Through the Innovations of Each Individual
KONOIKE STORY | The Future and Our Strategies | Sustainability | Foundation Supporting Value Creation | Data |
Introduction
First, I want to express my deepest sympathies to those affected by COVID-19 directly or indirectly.
During FY3/2022, we recovered to pre-COVID-19 levels, recording net sales of ¥301,300 million (up 3.1% year on year) and operating income of ¥10,200 million (up 157.3%). Performance improved as socioeconomic activities normalized gradually and the impact of COVID-19 on production and distribution diminished.
Looking back on our path to this point, FY3/2021, a year deeply affected by COVID-19, was a year in which we were forced to prepare for the first net loss in our 140-plus years in business. At that point, we embarked on structural reforms, working with internal entities and creating a new mindset
as we maximized our management resources. Tactics here included reassigning or seconding personnel to posts inside or outside the group from our airport business, which had swung to net losses. Together, we have worked as one
to confront this crisis. For better or worse, the COVID-19 pandemic was an opportunity to reaffirm the importance of our corporate philosophy that we pursue innovation at the foundations of our society that creates unique value, driven by respect for humanity and relationships of trust. At the same time, we realized that these internal collaborations have a significant effect on cost reductions. We hope to continue to strengthen these internal collaborations, not as a one-time event, but as an ongoing initiative to increase productivity.
2030 Vision
In light of the experience with COVID-19, and with the impact of the pandemic and further changes in the business environment, we revised our 2030 Vision this year. We
believed that we should better clarify the path we want to take over the medium to long term. The year 2030 will mark the 150th anniversary of our company. To achieve sustainable growth in the midst of rapid changes in the business environment, including labor shortages and geopolitical risks, not to mention the ongoing COVID-19 pandemic, we must think from a broader perspective. The future must not be an extension of the present, but the result of a broad, holistic approach.
We have always been good at focusing on and digging deep into the work that needs to be done in a single business area. This trait is something that our customers have come to appreciate. But if we can look from a higher-altitude view, we will be able to see the peripheral edges around our businesses, becoming more aware of the background behind customer issues and other related challenges. In this way, we will gain a much better understanding of our customers, proposing even higher-added value solutions. By utilizing the expertise and technologies from other departments this high-altitude view will become a driving force for creating better services and new value, which in turn will improve our contribution to our customers. Our 2030 Vision is, People, leveraging technology to reach for new heights. We include advanced technologies and the tacit knowledge (artisan skills) developed on the front-lines under our definition of "technology." This vision reflects our desire to be a company in which people play leading roles, utilizing all manner of technology in every direction, strengthening creativity, and creating safer, richer value and innovations.
This also means that we continue to exceed customer
expectations. In other words, we will continue to create higher added value, which inevitably leads to constant challenges. And while employees may feel pressure in this role, I believe that these challenges will lead to growth. At the same time, we will create a virtuous cycle in which customers will thank us and individual efforts become more appreciated within the company. This, in turn, will create more happiness and satisfaction among our employees. To this end, we focus on
Representative Director, Chairman, President and Chief Executive Officer
Tadahiko Konoike
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Chapter 02
KONOIKE STORY | The Future and Our Strategies | Sustainability | Foundation Supporting Value Creation | Data |
human resources development to help employees take on the challenge of creating higher added value, at the same time wielding technology as an important tool. For example, in the steel industry, we introduced drones and robots for on- site work, adding technology to locations that were previously the exclusive domain of manual labor. Here, the combination provides higher-quality services that improve efficiency, reliability, and safety. And while it goes without saying that employee education in safety awareness is vital, as is the case in our steel-related business, it is also important that we invest in safety through technology that reduces the workload of employees and creates safer work environments.
Medium-Term Management Plan
The preceding were my thoughts on the new 2030 Vision. Now, I will provide an overview of the medium-term management plan we have formulated as the first step toward achieving this vision. The basic policy of our medium-term management plan, which covers the three-year period from FY3/2023 to FY3/2025, is to leverage synergies between people and technology, striving to go beyond expectations in response to changing times. The aim of this basic policy is to improve profitability further and enhance corporate value by utilizing our strengths in people, front-line expertise, and new technologies. Our operating income target is ¥16,000 million. Since operating income for FY3/2022 was ¥10,200 million, an increase of ¥5,800 million over the next three years may seem like an ambitious goal at first glance. However, this is a target that not only I, but also our executive team, believe is feasible. Our belief takes into account the steady increase in profitability in each of our businesses in wake of the COVID-19 pandemic, the recovery in our airport business in line with the increase in flight operations, and our ongoing efforts to improve capital efficiency. Based on this target, we established four key initiatives as follows. First is to pursue innovation. Here, we have set challenges for ourselves in our Focus Businesses. We divided our Focus Businesses into two main categories. We first leverage our competitive advantages in each industry to achieve growth in Airport-Related and Medical-Related Businesses. The Airport-Related Business is a focus business, reflecting its strength in providing flexible and high-quality services to customers. Our Medical-Related Business is a
focus business because of its unique strengths in sterilization services and hospital logistics. At the same time, we added the Environmental & Engineering-Related Business and the India Business as focus businesses, as we expect these businesses to grow over the long term, serving to solidify our business foundation further in the future. In the Environmental
-
Engineering-RelatedBusiness, we intend to develop professional human resources, while addressing opportunities that include maintenance and upkeep, installations, and construction for existing customers. We will also explore new business areas such as next-generation energy. India
is an important region for us. We will strive to establish a business foundation in India, focusing on the development of our business in India by leveraging our existing ties with the Indian government, medical institutions, JICA, and Japanese companies in India. We will also look to collaborate with new customers who want to expand their businesses into the Indian market.
Second, we pursue safety and security, which has always been our highest priority. We will strengthen our commitment to safety and security even further through technological capital, which is included as a non-financialmetric in our medium-termmanagement plan.
Third, we pursue sustainability, which we address through three non-financial metrics that consist of environment, people, and technology. Our efforts in sustainability are both an important responsibility we meet as members of society and an essential element for sustainable growth. Over the past several years, our response to climate change with respect to the environment has become increasingly important. This issue presents aspects of internal risk for our company and our customers, as well as potential business opportunities. As a contractor, the more advanced our environmental efforts, the more secure a partner we can be for our customers to entrust us with their business. This can be a competitive advantage. The same applies to people and technology.
We have already engaged in these areas. But we will treat people and technology as even more important components of management capital, linking these components to management strategy for greater value. To achieve these non-financial metrics, we will set targets under the direction of the Sustainability Committee, managing progress to increase the effectiveness of our efforts. Various evaluation bodies and standards are involved in these non-financial metrics. But it is more important to envision how we grow through these
initiatives, rather than worry about simply meeting the world's standards.
Lastly, improve profitability. In the past, we monitored the number of unprofitable locations based on the size of invested capital. Beginning FY3/2023, we are no longer bound by that standard, and we increased the number of locations monitored for improvement. We intend to bolster management capital by improving capital efficiency, building a cycle for further growth by investing sufficiently in focus businesses and employee training.
Conclusion
Since our founding, we have always valued people and relationships. We believe that our employees should feel happiness as human beings through our businesses as they deliver happiness to our stakeholders. This is the purpose of our business, and it leads to maximum corporate value.
Now that we have formulated our 2030 Vision, it is the perfect time for our people and the company to grow in significant ways, each employee embracing the vision and taking on new challenges. The willingness of each individual to take on challenges increases the value we provide to our customers. And by receiving appropriate profits for the high value we add, we will improve human resources development and create safer work environments. These improvements will in turn lead to a cycle of human growth, safety, and security. If we strengthen the foundation of our company through this cycle, we will far exceed the financial targets in the medium-term management plan, which will also allow for sufficient returns to stakeholders. We are also confident that this cycle will allow us to achieve our 2030 Vision.
Our continued existence for more than 140 years since our founding is a result of the trust and patronage we have received from our stakeholders. As we strive to make further contributions to achieve our 2030 Vision, we ask for your continued support and expectations for the future growth of the KONOIKE Group.
13 | KONOIKE GROUP Integrated Report 2022 | KONOIKE GROUP Integrated Report 2022 | 14 |
STRATEGYChapter 02
KONOIKE Group Vision and Management Strategy
Amid changes in the industrial structure due to technological innovation and other dramatic drastic changes in the external environment, the KONOIKE Group, which has supported the foundations of business and society for 142 years through our endeavors toward innovation, created a new medium- to long-term management plan toward further growth. We aim to enhance corporate value permanently by pursuing both nancial and non-nancial targets.
KONOIKE STORY | The Future and Our Strategies | Sustainability | Foundation Supporting Value Creation |
Previous Medium-Term | FY3/2022 Policies | ||
Management Plan | Structural Reform Plan | ||
Previous Plan and FY3/2022 Review
New Medium-Term Management Plan
▶ P.17
We created the KONOIKE Group 2030 Vision in FY3/2019, reflecting a focus on financial targets. But in response to unexpected changes in the business environment, we reevaluated the content of our 2030 Vision and added clear non-financial targets. Our 2030 Vision (our goals) describes the ideal that we aim to achieve through our people, leveraging technology to reach for new heights. The 2030 Vision is an important goal essential for us in the eternal pursuit of our mission, or our corporate philosophy.
Under the previous medium-term management plan, we set about pursuing ve initiatives. And while we achieved a certain degree of success, the trade frictions between the U.S. and China beginning around October 2019, as well as the negative impact of COVID-19 beginning in February 2020, resulting in signicant underperformance in net sales, operating income, and operating income margin for FY3/2021.
During that time, COVID-19 created unprecedented circumstances causing socioeconomic turmoil on a global scale. We summarized the matters requiring prompt attention in the Structural Reform Plan. We began company -wide efforts under this plan in February 2020. Our priority at rst was to grow our business to avoid settling at the level of contraction. However, priorities shifted inevitably to cost reductions, which dampened slightly our
aspirations to challenge ourselves. We are more keenly aware than ever of our investments and their impact, engaging in investments accordingly.
Beginning FY3/2022, we have focused on improving protability, raising efciency, strengthening competitive- ness, and interdepartmental collaboration. As a result, the COVID-19 pandemic served as an opportunity to face issues that we had been trying to address without progress. These efforts led to signicant improvements in efciency, cost reductions, and the receipt of appropriate prices. And while certain external factors, such as soaring air cargo rates, contributed to higher prots, the largest contributor was the change in mindset by every employee. We have recovered to near pre-COVID-19 performance, despite net losses in the Airport-Related Business.
Vision 2030 Basic Policy
People, leveraging technology
to reach for new heights
Through the next-generation KONOIKE spirit that involves the use of cutting-edge technologies, we will evolve concepts on how to approach on-site solutions to the problems facing our customers and society.
Previous Medium-Term Management Plan | Structural Reform Plan | Policy for FY3/2022 | ||||
Action Items | Review | Action Items | Review | Action Items | Review | |
Strengthen business | While we made some | Priority at first was to | COVID-19 was an | |||
foundation to facilitate | ||||||
progress during the | Expand business | expand business to | Improve prot ratios | opportunity for the | ||
future growth | ||||||
period of foundation | avoid settling at a | company to confront | ||||
building, we missed | contracted level; | unattended issues. As | ||||
Restructure | numerical targets to a | however, we shifted | a result, we made gains | |||
management foundation | significant degree due | Improve prots | our priority inevitably to | Improve efciencies | in efficiency and | |
to the impact of | cost reductions, which | profitability, leading to | ||||
Instill management | COVID-19. | dampened our | the charging of | |||
awareness of the cost of | aspirations to challenge | appropriate prices. | ||||
capital | ourselves slightly. We | (Flexible employee | ||||
Follow stricter | did, however, develop | Strengthen | assignments, | |||
Foster growth through | ||||||
investment standards | an awareness for an | competitiveness | multi-skilled workers, | |||
cross-division | ||||||
even greater emphasis | personnel matching, | |||||
collaboration | ||||||
on investment impact. | etc.) | |||||
Engage in initiatives aimed | Create a smaller | Engage in cross | ||||
at value innovation and | ||||||
and more | ||||||
division collaboration | ||||||
the discovery/nurturing of | ||||||
efcient head ofce | ||||||
new core businesses | ||||||
Brand Promise
Our
Promise
Our
Brand
Corporate
Philosophy
Our
Mission
2030 Vision
Our
Business Strategy
Principle
Our
Value
Striving to Go Beyond Expectations
We pursue innovation at the foundations of our society that creates unique value, driven by respect for humanityand relationships of trust
People, leveraging technology to reach for new heights
Through the next-generation KONOIKE spirit that involves the use of cutting-edge technologies, we will evolve concepts on how to approach on-site solutions to the problems facing our customers and society.
Safety | We take responsibility for life
Passion | We are dedicated to quality Growth | We go further than yesterday
What does it mean to reach for new heights?
- We will adopt new technologies to make further progress in on-site safety as well as in improvements and advanced techniques, in order to realize a rich style of working that fosters individual creativity.
- We will seek to transform the tacit knowledge of experts into strengths in the form of shared group assets that everyone can use, honing the ability to respond to change that is a part of our DNA.
- We will raise standards of safety and security, enhance our ability to create next-generation businesses, and engage in further innovations to achieve the creation of a sustainable social infrastructure.
Net Sales, Operating Income, and Operating Income Margin | ROE · ROIC |
2030 Vision Target |
- Net sales (¥ hundred million) ■ Operating income (¥ hundred million) Operating income margin
3,108 | 3,013 | ||
2,941 | 2,923 | ||
3.7% | 3.1% | 3.4% | |
1.4% | |||
109 | 96 | 102 | |
39 |
ROE ROIC
6.4%
4.7% | |
4.6% | 3.9% |
7.5%
4.9%
3.4%
1.4%
Financial Targets | |||
Net Sales | (¥450,000 million)* | ||
Operating Income | ¥25,000 million | ||
ROE | 10% or higher | ||
Non-Financial Targets
Environment | Reduce CO2 emissions by 35% (vs. FY3/2019) | ||
People | Pursue human resources development under management strategy | ||
Raise employee job satisfaction (engagement) | |||
Technology | Automate and save labor through technological innovation and DX | ||
Pursue safety always by improving work environments | |||
2019.03 | 2020.03 | 2021.03 | 2022.03 |
2019.03 | 2020.03 | 2021.03 | 2022.03 |
*Net sales figure under 2030 Vision is a guideline
*We applied a new revenue recognition standard beginning FY3/2022
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STRATEGYChapter 02
KONOIKE Group Vision and Management Strategy
New Medium-Term Management Plan
The basic policy of the medium-term management plan is to leverage synergies between people and technology, striving to go beyond expectations in response to the changing times. And in this context, we dened four major initiatives.
KONOIKE STORY | The Future and Our Strategies | Sustainability | Foundation Supporting Value Creation | Data |
New Medium-Term Management Plan Response to Changes in the External Environment
- Steel-RelatedBusiness Outlook and Response
In line with structural reforms among our steel-related clients, the Wakayama district, where we have operated, suspended the operation of blast furnaces in the rst half of 2021. We have completed our response to this situation. The Kashima No. 3 blast furnace and other furnaces are scheduled to be shut down by the end of March 2025. Assuming that crude steel production in
Basic Policy Regarding the New Medium-Term Management Plan
Leveraging synergies between people and technology, striving to go beyond expectations in response to the changing times
the Kashima district will be halved, we expect a decrease in steel-related sales of approximately ¥9,000 million (slightly less than 20% of steel-related sales) compared to FY3/2022. However, we foresee the impact to occur in stages during the period of the medium-term management plan, and more signicantly beginning in FY3/2026.
- Impact of Blast Furnace Stoppages on Steel-Related Business (stoppages scheduled by the end of FY3/2025)
Four Major Initiatives
Approximately 20% |
• Planned stoppages of Kashima No.3 blast furnace and others by the end of |
FY3/2025 |
• Estimate based on our own assumptions for the full-year impact in the fiscal |
Pursue Innovation | |
• Take on challenges in Focus Businesses | |
(including M&A) | |
• Utilize technology, DX, and collaborative business | |
• Foster human capital |
Pursue Safety and Security
- Achieve greater levels of safety and security in work environments and society
- Safety-consciousemployee training
Net | Net |
Sales | Sales |
¥45,000 | ¥36,000 |
million | million |
2022.032026.03
*KONOIKE estimate of Steel-Related Business sales
year following the blast furnace stoppages (FY3/2026) |
• We assume the impact to be just under a 20% decrease compared to the |
steel-related sales in FY3/2022 |
Issues to address during the medium-term management plan
- Maintaining stable operating systems until stoppages occur
- Preparation for and respond to production systems after stoppages occur
Pursue Sustainability |
- Help create prosperous societies through total employee engagement
Improve Profitability
- Improve protability and efciency by pursuing innovation
- Always continue to improve protability
■ Steel-Related Business Initiatives (preparation for and response to production systems after stoppages occur) |
• Engage in the appropriate allocation of personnel according to changes in the production system before and after |
stoppages |
Strengthen cooperation with other divisions to cultivate new customers |
• Enhance value provided to customers and strengthen partnerships |
New Medium-Term Management Plan | Target | ||||||
Financial Targets | FY3/2022 | FY3/2023 | FY3/2025 | ||||
Results | Plan | Target | |||||
Net Sales | ¥301,300 million | ¥301,000 million | ¥332,000 million | ||||
Operating Income | ¥10,200 million | ¥11,000 million | ¥16,000 million | ||||
ROE | 7.5% | 6.0% | 8.0% | ||||
Non-Financial Targets | FY3/2022 | FY3/2025 | |||||
Results | Target | ||||||
Environment | 13% reduction | Reduce CO2 emissions by 20% (vs. FY3/2019) | |||||
(169,116 t-CO2) | |||||||
People*1 | Pursue human resources development under management | ||||||
strategy Raise employee job satisfaction (engagement) | |||||||
Technology*2 | Automate and save labor through technological innovation | ||||||
and DX Pursue safety always by improving work environments | |||||||
*1: Create a human resources development plan and conduct surveys by the first half of FY3/2023 | |||||||
*2: Establish an implementation plan for initiatives by the first half of FY3/2023 |
Medium-Term Management Plan Financial Policies
Pursue DX and drone utilization to improve work efficiency, etc. |
• Expand operations further by taking on the challenge of new business opportunities (decarbonization-related, |
overseas business) |
- Airport-RelatedBusiness Outlook and Response
The spread COVID-19 continues to have an impact on passenger ights, and the service rates for international ights are still in the 10% range (as of March 2022) compared to the pre-COVID-19 era. Although we believe this challenging situation will continue to a certain extent in the future, our medium-term management plan assumes international ight service rates will remain at the current level throughout the rst half of FY3/2023, recovering in the second half and thereafter, resulting in an average annual service rate of approximately 30%. In the following scal year and beyond, we forecast a base scenario of 50% rst half and 70% second half recovery rates, returning to protability by FY3/2025. Our upside scenario calls for 60% and 90%, respectively, and a return to protability FY3/2024, with prot of about ¥2,000 million in FY3/2025.
- Impact of Airport-Related Business Scenarios on Business Performance
Operating Income | (¥ hundred million) | Created using international ight service rate as a key factor (return to service rate |
compared to 2019, pre-COVID-19); base scenario uses for the medium-term plan |
- Airport-Related ■ Operating income excluding Airport-Related FY3/2023 assumes current level in rst half, recovery in second half, and average annual
102160recovery of 30%
110Airport-Related
International Flight Service Rate | Business Profit Plan (¥ hundred million) | |||||||
156 | ||||||||
139 | 134 | Base Scenario (Medium-Term Plan) | 90% | ■ Base Scenario (Medium-Term Plan) ■ Upside | ||||
Upside | ||||||||
4 | 60% | 70% | 20 | |
-37 | -24 | 4 | ||
Operating Cash Flow | • Between ¥45,000 million and ¥50,000 million |
(three-year cumulative) | |
Investments | • Growth investments for ongoing corporate |
value enhancements | |
• Investment decisions based on NPV and ROIC | |
• Dividend levels maintained at ¥36 per share | |
Shareholder Returns | annually or improved |
• Consider opportunistic share buybacks as an option | |
• Maintain a DE ratio of 0.8 times or less | |
Disciplined Finance | • Maintain a shareholders' equity ratio of 40% |
or higher | |
• Rating of A- or higher | |
Under our medium-term management plan, we seek to achieve our 2030 Vision and enhance corporate value in a sustainable manner. To this end, we intend to make investments necessary for future growth, as well as investments in technological innovation, DX, M&A, maintenance, and upgrades. As we conduct investments, we will remain aware of the cost of capital and execute investment decisions based on NPV and ROIC in light of hurdle rates.
Capital investments, M&A, and shareholder returns will be within the framework of our assumed ¥45,000 million to ¥50,000 million in operating cash flows (three-year cumulative).
In addition, we will maintain disciplined finance and ensure financial health in consideration of the balance among investment capacity, optimum financial structure, and capacity for shareholder returns.
2022.03 | 2023.03 | 2025.03 | 30% | 50% | |||||||||
30% | |||||||||||||
* Operating income excluding Airport-Related: Consolidated | |||||||||||||
-24 | -24 | ||||||||||||
operating income - Airport-Related operating income | |||||||||||||
2023.03 | 2024.03 | 2025.03 | 2023.03 | 2025.03 | |||||||||
■ Airport-Related Business Initiatives | |||||||||||||
Establish | Continue personnel matching and | Services by Airport (〇: Contracts in place) | |||||||||
demand-response | establish an early-stage stafng | Passenger Ramp | Cabin | Cargo | Other | Passenger Ramp | Cabin Cargo Other | ||||
system | structure in line with demand recovery | Kansai | ○ | ○ | ○ | ○ | ○ | Kobe | ○ | ||
❶Expand services provided at | |||||||||||
Haneda | ○ | ○ | ○ | ○ | Naha | ○ | ○ | ○ | |||
Expand business | domestic airports | Narita | ○ | ○ | ○ | ○ | ○ | Overseas | |||
fields | ❷Expand into major domestic airports | ||||||||||
Fukuoka | ○ | ○ | ○ | ||||||||
❸Expand into overseas airports | |||||||||||
Itami | ○ | ||||||||||
*Ramps: Loading and unloading, guidance, etc. | Other: Airport operations, etc. |
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Chapter 02
Achieving Our 2030 Vision and
New Medium-Term Management Plan
Director and Senior Managing Executive Officer Message
KONOIKE STORY | The Future and Our Strategies | Sustainability | Foundation Supporting Value Creation | Data |
External Director Messages
than 140 years. The important thing is to look to our Corporate Philosophy and foster a corporate culture in which each individual takes on challenges without being bound by preconceived ideas.
Clarifying Our 2030 Vision
Challenges we undertook in our previous medium-term management plan included establishing the New Business Development Division and the subsequent founding of the Konoike Institute of Technology Innovation Center (under the new Technology Innovation Promotion Division), an open innovation hub to accelerate technological innovation in the logistics field. We are replicating these innovation initiatives gradually in an increasing number of in-house applications. One example is innovation at steelworks, where on-site employees have improved
Even as COVID-19 infections continue, the unthinkable happened in Russia's advance into Ukraine, not to mention the assassination of Japan's former Prime Minister Abe. We are reminded that even though we continue seek peace and stability, nothing is everlasting, as the saying goes. The reality is that our social environment continues to experience violent changes, including natural disasters, epidemics, and conflicts.
Despite these circumstances, the KONOIKE Group strives to overcome these difficult times through the tireless efforts of every employee, driven by a strong sense of unity developed over the long history of the company.
Yoshihito Ota
The KONOIKE Group formulated a vision for 2030 in People, leveraging technology to reach for new heights. Naturally, this vision is based on a corporate philosophy and mission to pursue
innovation at the foundations of our society that creates unique value, driven by respect for humanity and relationships of trust.
The more society evolves, the greater the distortions and social friction that occurs. If the company is surprised by these frictions and allow them to take control, KONOIKE will never be able to achieve sustainable growth. It is my sincere hope that the company unites under this excellent corporate philosophy and vision, aiming for further growth.
Director and Senior Managing
Executive Officer
In charge of International
Business/In charge of
Technology Innovation
Tadatsugu
Konoike
A Personal Mission
Society faces challenges that continue to change dramatically, and even daily. COVID-19, supply chain and logistics disruptions, and decarbonization issues are just a few of the challenges. In these circumstances, our basic stance of listening sincerely to our customer, digging to find the underlying issues, and solving customer concerns has remained unchanged since our founding. Our mission, which will never change, is to pursue innovation at
several operations through new technologies. We also introduced digital forwarding as a means of reforming international logistics operations and creating new value via data sharing and utilization. I feel that we have finally reached the stage where the seeds we have planted are beginning to sprout.
However, we must not forget that, as stated in our 2030
Vision, People, leveraging technology to reach for new heights, it is people who play the key role. This statement means that every group employee shares the same vision and strives to embody these words by his or her own hands. It goes without saying that the KONOIKE Group cannot grow without the growth of existing businesses. For further growth, however, we must take on the challenge of creating new value, not only within the company, but also by leveraging external technologies.
Global Expansion
These challenges are by no means limited to our domestic market. Using the strengths we have developed in Japan for greater global expansion is not only very possible, but essential
One of the highlights of this fiscal year was | |
the review of the 2030 Vision, prior to the | |
announcement of the new medium-term | |
management plan. I first heard the phrase, People, | |
leveraging technology to reach for new heights | |
at a board meeting after various discussions. My | |
first impression then was to question whether the | |
phrase would be understood by shareholders, | |
investors, customers, and employees. But when | |
I heard the three points under reaching for new | |
heights, I was convinced immediately. All three of | |
the points are important, but I feel strongly that | |
the future of the KONOIKE Group lies under point | |
2, We will seek to transform the tacit knowledge of | |
Mika Masuyama | |
experts into strengths in the form of shared group | |
assets that everyone can use, honing the ability | |
to respond to change that is a part of our DNA. | |
This point is important because we have created | |
relationships of trust with every customer based | |
on true expert knowledge. |
Half of the first year has already passed since the announcement of the 2030 Vision and the new medium-term management plan. KONOIKE is still halfway through the process of reviewing its business portfolio, building an organizational structure suitable to the goals for which the company aims, developing a structure for new businesses, and promoting the best possible DX for the KONOIKE Group, and fully utilizing outside expertise. But the company is moving forward steadily, unwavering.
I expect to use board meetings to follow up on the progress of the new medium-term management plan from both a short-term and a medium- to long-term perspective. And if progress doesn't go as planned, we should discuss appropriate solutions as executives.
I am committed to using leveraging my own experience and expertise to contribute to sound growth of the KONOIKE Group.
the foundations of our society that creates unique value, driven by respect for humanity and relationships of trust. This is the path that we promise to follow. However, I believe that the way we go about work must change in fundamental ways. Structural challenges include a shrinking workforce, while technological innovations such as AI and IoT are making remarkable advancements. These challenges and technologies are causing revolutionary changes in the supply chain. For the KONOIKE Group to provide more valuable services to our customers in this environment, we feel the need to innovate and create new value by incorporating new technologies, as well as expertise from outside our organization. At the same time, we recognize that such innovation is not so easy. This is especially true for a company like ours with a history and culture developed over more
for our future growth. Yes, we have achieved overseas expansion to a certain extent during the period of the previous medium-term management plan. But we recognize that we have only just begun. And to expand overseas further, we must develop global human resources. Our global human resources must set foot on foreign soil, interact with local people, and experience the local culture. Integrating human resources experienced overseas with technology will create unprecedented added value. Based on my experience of studying abroad as a student, I believe that deepening international exchange through our business of international logistics, etc., can create a world of peace without conflict.
The KONOIKE Group will continue to pursue innovative initiatives and strive to enhance corporate value, becoming a company needed by our stakeholders.
The KONOIKE Group established a long-term vision of People, leveraging technology to reach for new heights. I feel that the extraordinary resolve of the management team is evident in this vision.
The global situation is changing dramatically. Russia's invasion of Ukraine, the destabilization of U.S.-China relations, and the unpredictable direction of the COVID-19 pandemic, to name just a few. This geopolitical instability, combined with the spread of infectious diseases, is disrupting economic activity. Corporate activities are exposed to various risks in the field of logistics, production, and services. These risks demand
increasing levels of problem-solving capabilities
Taisuke Fujita from KONOIKE, a company that supports on-site operations in the field (social infrastructure).
I believe that KONOIKE has the ability to respond proactively in resolving the changing concerns of its customers. And yet, the main actor here is not the technology, but the people. The best technology is not always the most advanced. With a little ingenuity and imagination, people can still improve work sites and the supply chain. KONOIKE expects its employees to generate ideas and conceive the technology to make ideas a reality. It is up to KONOIKE management to develop strong sustainable business models and strategies to achieve its stated 2030 Vision. As an outside director, I am committed to working with the management team to enhance corporate value, remaining conscious of improving the well- being of KONOIKE stakeholders.
19 | KONOIKE GROUP Integrated Report 2022 | KONOIKE GROUP Integrated Report 2022 | 20 |
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Konoike Transport Co. Ltd. published this content on 30 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 November 2022 09:23:20 UTC.