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2024.5.17

Discovering the Potential of "moganadx," a Digital Transformation (DX) Service for the Manufacturing Industry Offering "Services You Wish Existed"

In 2018, Sumitomo Corporation launched the DX Center, a dedicated organization to promote digital transformation across the Group. Since then, we have created over 300 projects dedicated to business transformation. One example is moganadx, a DX service for the manufacturing industry that launched for commercial use in 2023. We spoke with Masaki Taji and Ryutaro Hodai, core members of the moganadx project, about the strengths of Sumitomo Corporation as an integrated trading and business investment company, their efforts in developing the service and their aspirations for "DX involving local communities" as the culmination of their vision.

  • Digital Strategy & Promotion Dept.

    Masaki Taji

    For 10 years after Taji joined the company as a new graduate in 2007, he was in charge of thin sheet products for Thailand in the Metal Products Business Unit. Following his stint in Thailand, he participated in the launch of the DX Center. He worked as a moganadx project manager at the DX Center until March 2024 (the time of this interview), and has been stationed in Hanoi, Vietnam since April 2024, where he is currently on assignment at Thang Long Industrial Park. He was a finalist in the “0→1 Challenge”, Sumitomo Corporation’s "intrapreneurship" program, for his energy storage business proposal.

  • Assistant Project Manager,
    DX Center, Digital Strategy & Promotion Dept.

    Ryutaro Hodai

    After working in systems development at a major IT vendor and in data analysis and digital marketing-related work at a consulting firm, Hodai joined Sumitomo Corporation in November 2023 as a mid-career hire. As the head of Inside Sales and the Product Manager (PdM) area, he is responsible for promoting sales activities and management related to product development, operation and maintenance.

Providing "Services You Wish Existed" for Manufacturers Through Subscriptions and Software as a Service (SaaS)

To begin, could you give us an overview of the "moganadx" DX service for the manufacturing industry and its key features?

Taji Our service "moganadx" aims to increase productivity at manufacturing sites where so-called "analog management" like paper ledgers, order slips and Excel data are still the norm. The service digitizes and consolidates disparate production site data scattered across individual systems into a single system to visualize, aggregate and identify issues in facility operations and business operations as a whole.

In addition, moganadx is committed to the concept of "taking the first step toward DX." Instead of requiring customers to bulk-purchase a large system, we provide services on a subscription basis and SaaS (*1) , which allows customers to use the service at a fixed monthly fee. In addition to reducing the initial costs, moganadx requires less time and effort to implement. For company presidents and factory managers at overseas sites, negotiating and seeking approval from the Japanese headquarters on system implementation is particularly time consuming; moganadx makes it easy for such decisions to be made locally. This is just one feature that really makes our customers’ lives easier.

The service name mogana comes from an old Japanese phrase meaning "wouldn’t it be nice if..." or in this case, "services you wish existed." The project members brainstormed ideas and eventually landed on this moniker. Instead of using stylish foreign words, we have used this iteration of an old Japanese phrase in an attempt to express our "tenaciousness" as a trading company offering support in areas where the introduction of new systems alone fails to solve all the issues, or in other words, our ability to "cover all pain points."

*1 SaaS: "Software as a Service" is a service that makes software running on a cloud server available to users via the Internet

Images of the moganadx introduction process

Not Just Empty Talk: Game-Changing DX for Daily Operations

What was the specific process and structure of the service prior to commercial launch?

Taji Sumitomo Corporation has developed and currently operates eight industrial parks in Asia, and many of the tenant companies are manufacturers. To develop moganadx as a service, we interviewed personnel and management at about 70 manufacturing sites, asking them about the KPIs they had set within their companies and the indicators they needed to manage. As we conducted more interviews, we realized that there was a latent need to move from traditional "management relying on experience and instinct" to "advanced management based on data."

To this end, we decided to start the DX process with the seemingly simple task of "digitizing paper and visualizing data," which relates to actual operations, and from there, to provide a one-stop digital service. Starting in 2021, we asked domestic companies to cooperate with field tests, reflecting the requests and issues we collected from actual workplaces, rather than armchair theories, in our prototypes, which we refined over time. Later, with introductions from local expatriates, we conducted trials with several companies in the Thang Long Industrial Park in Vietnam, which is also the center of current sales activities. Based on the feedback we received, we developed the product to be tailored to manufacturing sites.

Hodai When moving from PoC (Proof of Concept) to the implementation phase, we were referred to Insight Edge, a technology company established by Sumitomo Corporation to promote DX, and we selected an offshore IT vendor in Vietnam as our development partner. We developed the product while considering a balance between price and quality, as well as the operational structure after full-scale deployment.

Taji In 2023 we embarked on commercialization in Vietnam. In the future, we intend to expand the service to Japanese manufacturers based in Southeast Asia, and following further enhancements, our goal is to have the service in place at a total of 600 companies by FY 2030.

Images of moganadx's service expansion: Providing one-stop digital services, starting with the digitization of daily reports and instructions (QCDSE: Quality, Cost, Delivery, Safety, and Environment)

Creating a Platform That Aggregates Best Practices of the Japanese Manufacturing Industry

Did you encounter any difficulties in moving forward with the project?

Taji Since the launch of the service, we have faced issues on two fronts: sales and products. From a sales perspective, the fact that the style is less SaaS-like and more opaque is a positive, but also a challenge from the standpoint of standardization and related issues.

Hodai Typically, the SaaS sales style involves dividing roles between inside sales (sales via e-mail or telephone) and field sales (face-to-face sales) to improve efficiency. However, at present, there are areas without any clear division of labor, and we sell in a semi-consultative manner, lending an ear to customer's requests and tailoring our services to their business. Although it’s relatively typical of B2B type services, our sales method is somewhat unique.

In terms of products, the manufacturing industry is characterized by completely different business processes at each site, so development is tailored to the customer's needs on a case-by-case basis. Ideally, we would like to create a general-purpose system that can be used by a wide range of manufacturers, but this is not easy, and remains an issue we need to address.

Conversely, could this be something that can be resolved precisely because Sumitomo Corpration works so closely with its customers and addresses respective issues individually?

Taji I think that’s precisely correct. Looking at the bigger picture, the strength of the Japanese manufacturing industry has been founded in the expertise of individual companies. However, given the tremendous momentum of manufacturers in other countries at the moment, the question for Japanese manufacturers is how to compete by combining their expertise and creating a collective knowledge base. We hope to continue expanding the functions of moganadx going forward to create a platform that brings together all of the best practices of the Japanese manufacturing industry.

Contributing to Happiness Through the Digitization of Entire Towns and Cities

Finally, what are your future goals for the project, and what is your vision for the future?

Taji Our goal is to achieve Sumitomo Corporation’s corporate mission of " To achieve prosperity and realize dreams through sound business activities," through the moganadx project.

Our current DX service is being developed as a B2B business for Japanese manufacturers, and that is our main focus. But we believe that in the future there is room for expansion into SMB (*2) and B2C businesses for people living in and around overseas industrial parks, including retail facilities and stores in local cities and towns. I worked for a business firm in an industrial park in Thailand, and I believe that industrial parks themselves essentially function as towns and cities, too. They are home to the people who work in their factories, and they provide infrastructure including water and electricity, supermarkets, pharmacies and restaurants. I think we should look at "towns and cities" beyond manufacturing sites in order to create a "DX business unique to an integrated trading company" that can contribute to local communities through digitalization.

*2 "Small and Medium Business": small and medium-sized businesses

Hodai As a team member, I would like to focus on activities to expand the current range of moganadx services, while also making efforts to provide greater added value to local markets by utilizing internal and external collaborators and assets.

Before joining Sumitomo Corporation, I worked for an IT vendor and a consulting firm, where I solved problems and provided solutions for specific customers, developing products with an emphasis on technological leadership. However, since joining Sumitomo Corporation, an integrated trading company, I have become more conscious of the social significance of my work – from a more overarching perspective, namely the question of "What can we do for society through our business?" Our final goal is to create a system that not only benefits manufacturing sites but also contributes to the happiness of people living in adjacent towns and cities.

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