New initiatives launched to resolve social issues through business
Nippon Express Co., Ltd. (Mitsuru Saito, President; hereinafter, "Nippon Express") and NEC Corporation (Takayuki Morita, President and CEO (Representative Director); hereinafter, "NEC") concluded a business tie-up agreement on joint value creation through digital transformation (DX) on Thursday, June 17.
[Overview of business tie-up]
Nippon Express utilizes its world-class logistics network, the extensive logistics know-how it has accumulated and a full range of transport means to maintain reliable supply chains in its capacity as a company operating as part of social infrastructure.
NEC employs AI, IoT, robotic control and other cutting-edge digital technologies to support the DX efforts of client companies based on its "Value Chain Innovation: DX for Companies and Industries" concept.
The two companies entered into a business alliance in 2013 to strengthen their global logistics services, and they have since been administering their joint venture Nittsu NEC Logistics, Ltd., and otherwise working to improve the sophistication and efficiency of logistics.
Recent years have seen the logistics industry confronting increasingly serious labor shortages due to declining birthrates and shrinking populations as well as changes in work styles, complicated supply chains and digitalization. On the environmental front, reducing CO2 emissions has become a major social issue, and companies are being called on to help bring about decarbonized societies in line with declarations made by Japan and other countries to achieve carbon neutrality by 2050.
To meet the demands of society for ever more sophisticated logistics, the two companies launched an exploratory project for value co-creation in October 2020 and more recently signed a business tie-up agreement. By combining Nippon Express' global logistics network and logistics know-how with NEC's state-of-the-art AI, IoT and other digital technologies and integration capabilities to resolve social issues through new businesses, they hope to play a critical part in realizing a sustainable society.
In co-creating value through DX, the two companies will be (1) using IoT to establish more efficient, labor-saving and unmanned warehouse operations in the short term, and (2) discovering and creating new businesses for the two companies utilizing digital technologies over the medium to long term.
One short-term approach will be to digitize the know-how and tacit knowledge of workers by utilizing IoT to rapidly and suitably collect data on the movements of people and goods at warehouses and then to analyze this data in a timely fashion using AI. This approach will maximize warehouse performance, help resolve labor shortages, and create an environment in which workers can carry out their tasks safely and securely.
Looking further ahead, the two companies will be striving to eliminate accidents and optimize staffing at all transport, delivery and other logistics facilities. They will be focusing their industry-based efforts first on the priority sector of electrical machinery and electronics, and then considering expansion into semiconductor and automobile supply chains.
②Medium- to long-term efforts
For the medium to long term, the two partners will be exploring the possibility of creating a society in which people are able to support each other across distances. They envision using AI and remote-controlled robots to perform work in places where manual labor might be particularly difficult, such as industries with diminishing workforces, locations with poor working environments, dangerous sites, and facilities on the other side of the globe.
The two companies will begin demonstrations of this approach by employing remote control in Nippon Express's warehouse operations and accumulating knowledge by training personnel to operate robots and developing operational programs. This endeavor will help support the development of society across generations, national borders, and industry boundaries.
In addition, they will work toward the realization of a sustainable society by visualizing and reducing CO2 emissions in logistics processes, comprehensively extending these efforts across the supply chains of their partners, customers and others to reduce society's impact on the environment.
The long-term vision formulated by Nippon Express with an eye to its 100th anniversary calls on the company to "create new value through innovation". Through this latest initiative, Nippon Express hopes to achieve DX for entire supply chains by promoting and upgrading digitalization at logistics facilities and creating new growth sectors. Addressing social issues as a corporate group will also enable the company to help society reach sustainability.
NEC's "NEC 2030VISION" advocates "living harmoniously with the earth to secure the future" and "creating sustainable societies by shaping new industries and workstyles". In undertaking this collaborative effort, the company is aiming to expand its arsenal of solutions under the concept of "Value Chain Innovation: DX for Companies and Industries", connect goods and processes beyond the frameworks of individual industries, and develop digital innovations that create new value, all the while leveraging these activities to upgrade the NEC Group's own supply chains.