Digital innovations

Managing Executive Officer
Chief Digital Officer
Soichi Kobayashi
November 2023

Challenges and changes are necessary for companies to achieve sustainable growth, and DX has become the norm. There are various targets and methodologies for DX, but the important thing is that customers, business partners, and employees can realize the benefits of digitalization, and then proceed with transformation.
In order for customers to use our services comfortably, we plan to expand the functionality of DriveOn, which is currently available at SS (service station), and make the interface more attractive.
We are also working on a "30% productivity improvement" initiative to improve productivity by taking inventory of our supply chain and indirect operations, including points of contact with our business partners, and transforming them into operations that incorporate digital technology. Dozens of projects have been launched, including those under consideration.For example, in the lubricant business, which is characterized by low-volume, high-mix production, data analysis tools will be used to complete manufacturing and sales plans and profit management analysis in a short time. It is now possible. We are also working to create an environment where all employees can utilize generated AI and easily use databases.
Since people support these activities, we are working on skills education to advance DX. We have divided the process of developing digital human resources into three stages, and are working to enhance educational programs at each stage. Approximately 2,000 employees have already completed the basic stage, which aims to acquire basic knowledge of digital literacy.
We will put into practice the knowledge gained through this education and use it to improve productivity, as well as create an environment that can lead to the creation of new value.

Efforts to improve productivity can be broadly divided into a. Evolving a digital work style common to all employees, and b. Efforts to realize departmental strategies.
We believe that the use of generative AI is essential as part of the evolution of digital work styles. We are currently building an Idemitsu version of ChatGPT environment that allows secure use of ChatGPT, and are encouraging all employees to use it. In the future, we will promote collaboration with our own proprietary database and increase the utilization of generated AI to improve the efficiency of our own operations. Additionally, by creating an environment that enables no-code ^* and low-code ^* app development and providing a place for education, we aim to expand the number of citizen developers and activate information sharing by strengthening the community.
Meanwhile, in order to improve productivity in order to realize each business division's strategy, we have formed a co-creation project team between business divisions and digital divisions. We are developing a method to visualize business flows and information flows for processes that are causing issues, identify bottlenecks and duplications, and then add digital countermeasures. In addition, we are building an environment that centrally manages domestic and international data and making it possible to consider business optimization on a global basis, as well as promoting cross-business data visualization with the aim of speeding up decision-making. The efforts of each of these departments are published on the internal portal site, and information is shared so that it can be utilized in the activities of other departments.

*No-code/low-code: Developing without using programs (as much as possible)

Activity example: Improving the efficiency of vehicle dispatch work through system advancement

Regarding the ordering and dispatching of Petroleum, we are planning to introduce a system that will utilize AI technology to streamline the work of those in charge, and we are moving forward with the project with the aim of introducing it within fiscal 2023.
We built and systematized tank inventory forecasting, order creation models, and vehicle dispatch planning optimization models for SSs that perform planned deliveries, and performed highly individualized demand forecasting, order creation, and vehicle dispatch planning tasks while maintaining ① quality. The aim is to reduce delivery time by 25%, and ② to create effects such as preventing out-of-stocks at planned delivery destinations by predicting SS demand.

We started the BPR activity "Digital for Idemitsu" in April 2020. We are working to transform entire business processes using digital technology to create new social and customer value, and to help our employees accumulate co-creation experience and knowledge.
We conduct multiple on-site verifications, confirm the results of each, and improve our business processes by starting small. We are making steady progress in creating synergies between divisions and optimizing information within divisions as a whole.

●Main initiatives of Digital for Idemitsu