Special Feature: MC's Value Creation (DX)
01.VALUE CREATION
MC's Sustainable Value Creation Story
02.SUSTAINABILITY
Management Platform Supporting Value Creation
- Sustainability Promotion Framework
- Risk Management
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Stakeholder Engagement
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Corporate Governance
03.DETAILED FACTS
Reference Information
- Members of the Board and Audit & Supervisory Board Members
- Executive Officers
- Organizational Structure
- Business Groups at a Glance
- Global Network (Countries and Regions)
- Balance of Risk Money Outstanding in 12 Countries
- Financial Highlights
- ESG Data
- Corporate Information
- Shareholder Information
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Description of Business Activities: Business Groups
MC's Industrial DX Initiatives
Our vision for industrial DX
The MC Group is active across a wide range of businesses, with operations spanning the entire supply chain at the upstream, midstream and downstream levels, providing connections with customers in virtually every industry. Our earnings are generated by the approximately 1,700 companies that comprise the consolidated MC Group, each of which plays a leading role in the business. For this reason, our commitment to industrial digital transformation (DX) must not only apply to the relevant business interests within the parent company, but also extend to our wider business networks through our support to the independent DX initiatives being promoted by players in each industry. Our vision is to create a shared digital platform that can provide solutions to accelerate DX across a variety of sectors in order to support industrial growth and address societal issues.
A DX promotion system to drive business model transformation across diverse industries
Through industrial DX, we aim to provide new value by combining our wide-ranging industrial knowledge with digital technologies. Even as a global integrated business enterprise, the MC Group needs to possess core technological capabilities in order to increase competitiveness. Accordingly, we established MC Digital, Inc. in September 2019 with the aim of enhancing our internal capabilities to drive DX. Through this company, which brings together leading data scientists, design specialists and IT engineers, MC is implementing measures to promote industrial DX.
In December 2019, MC concluded a business partnership with Nippon Telegraph and Telephone Corporation (NTT). This partnership was established with the goal of creating new value by combining MC's strong industrial expertise with the digital capabilities of NTT. In May 2020, MC and NTT jointly invested in HERE International B. V., the world's leading location-based service company, and in June 2021, they established Industry One, Inc., a joint venture company specializing in DX services. Through Industry One, MC aims to support the development of industries and businesses in Japan as a transformation partner by providing a comprehensive range of services from DX platform creation to the establishment of digital businesses.
Addressing Societal Issues with Industrial DX
── Creating a Food Distribution DX Platform
Contributing to the Food Distribution Field
and Offering New Value
Consumer Industry Group Kiyotaka Kikuchi
MC has been active in the food distribution sector for over 50 years, and today works with thousands of suppliers and business partners. Together with our partners, we have for some time been adapting and implementing digitalization measures in preparation for the creation of a platform. At present, the environment surrounding food distribution is affected by various societal issues, including food loss and a shrinking labor pool. One of the challenges facing the food distribution industry in Japan is the problem of food loss, which costs an estimated one trillion yen annually. Most of this food loss occurs during the distribution process, primarily due to product expiration as a result of over-production or excess inventory.
One possible solution to this problem might be the use of point of sale (POS) data from retail operations, which are the closest touchpoints with consumers, as the basis for sophisticated demand forecasting by food wholesalers and manufacturers. This could help reduce food loss and improve the efficiency of food distribution activities.
MC and Nippon Telegraph and Telephone Corporation (NTT) have collaborated to create a platform that uses digital technology to seamlessly integrate data scattered within and among companies, together with weather forecasts and other external data. Using this platform as a foundation, we are currently developing our own demand forecasting AI in collaboration with MC Digital, Inc. During proof-of-concept (PoC) inventory-reduction trials with Mitsubishi Shokuhin Co., Ltd., this AI system successfully reduced the amount of inventory held at distribution centers by around 30% on average, and by as much as 40% in some cases, while also cutting down on the rate of product shortages.
This system will initially be provided to Lawson, Inc. distribution centers operated by Mitsubishi Shokuhin, and it will then be progressively rolled out in collaboration with Mitsubishi Shokuhin to other companies. Through these initiatives, we hope to simultaneously generate economic, societal and environmental value by reducing CO2 emissions associated with food loss and shipping, while also working to address other social and environmental issues, such as labor shortages.
Our future plans include further collaborative initiatives with our external partners, such as Toshiba TEC Corporation and Fujitsu Limited. In addition, MC, NTT and Industry One, Inc. are planning to conduct a PoC study on smart contracts later this year. We will continue to announce more initiatives designed to expand DX services not only in the food distribution sector, but throughout Japanese industry as a whole.
