Japan has entered a period of a declining birthrate and aging population. Thus, the country is compelled to reform its work styles, which involves reducing long working hours as well as reforming the awareness of companies and workers. This report discusses how ICT and other new innovations can help address these challenges.
[Fujitsu Insight 2017 "Work Style Innovation" Keynote Report]
The seminar consisted of two parts. The first contained presentations by Munetomo Ando (Associate Professor of Economics, Nihon University) and Akihiko Sato (HR Group, Fujitsu). The second part contained a panel discussion in which the previous two presenters were joined by Shunsuke Takahashi (Project Professor, Keio University).
Can Work Style Innovation Respond to Two Social Changes?
A Skills Mismatch Allows a Labor Shortage and Unemployment to Coexist
If you ask experts, such as labor economists and legal scholars, which two factors may potentially change our work styles, you will hear the following answers. One factor is the declining population. Japan's population will decrease due to the declining birthrate and aging population, but the real problem is not the overall declining trend but rather the different population decline rates among generations. The productive-age population aged between 15 and 64 is expected to decrease by approximately 10 million every 10 years.
The other factor is "rapid changes in technologies." Technological unemployment will occur when human workers are replaced by machines. For examples, at train stations, human jobs have already been replaced by automatic ticket machines and automatic ticket gates. Though the slow pace of technological progress enriches people's lives, one day you may suddenly find yourself out of work. We must seriously consider which kinds of jobs are likely to disappear.
In the future, while the working-age population will decline, the number of unemployed will increase. You may think, "The unemployed can work in understaffed workplaces." However, naturally someone who has been doing the same work for 30 years cannot suddenly work in a different field, such as construction, nursing care, AI, gaming, or smartphone app development. Taking this into account, one can say a major reason why a labor shortage will coexist with unemployment lies in a skills mismatch.
"The Action Plan for the Realization of Work Style Reform" I mentioned at the start can be categorized into the following five groups:
- Equal pay for equal work
- Limitation on the number of working hours
- Flexibility, measures for women and younger workers, diseases, etc.
- Wage and productivity increases
- Job placement support, the educational environment
These are core elements of work style innovation; however, workers' vague anxieties cannot be eliminated just by putting these plans into motion. The key is to consider how workers can acquire skills and who will implement support measures and activities.
For example, "matching support between labor and management" is a necessary kind of support. Such matching requires use of public institutions and private HR consultants and brokers as well as support from various organizations, including universities and labor unions. Whether future corporate management succeeds or fails will be determined by whether they can successfully carry out such labor-management matching.
Developing a Pleasant Working Environment Increases Profits
Developing a pleasant working environment is also important. This does not mean prioritizing working environment improvements over generating profits; rather, it means to promote recruitment and suppress turnover, which naturally increases a company's profits.
Use of ICT is indispensable in developing a pleasant working environment. For example, telework enables employees to work from anywhere, eliminating commuting time, which may prevent workers from quitting their jobs to perform childcare or nursing care. Use of AI also helps improve work efficiency.
Other work style challenges include work allocation, personnel evaluation, equality between in-office work and telework, and achieving feelings of satisfaction. Some elderly people still say, "How on earth can men take childcare leave?" while others cannot tolerate diverse work styles. Reforming such individuals' awareness is also necessary.
Delaying work style innovation may prove fatal to companies. So, what should be done specifically? Companies that can take measures early will definitely differentiate themselves from those that cannot. It is important to learn from other companies' successful cases and what combinations of solutions proved most fruitful.
Fujitsu's Work Style Innovation--How Telework Changed Its Work Style
Basic Concept of Work Style Innovation
Fujitsu has 34,500 employees on a non-consolidated basis. Although we aim to become a global ICT player, our organizational climate partly remains that of a manufacturer with a traditional Japanese personnel system.
The basic concept of Fujitsu's work style innovation is to respond to digitization, promote diversity, change our labor composition, and limit long working hours. To tackle these challenges, we must promote work style innovation in parallel with our current diversification and healthy-company strategies, which I believe will contribute to the growth of the company and our employees.
The needs to respond to digitization and promote diversity arise from technological evolution and changes in working environments. In particular, promoting diversity is necessary to address employee aging and the high turnover rate in female workers. Measures must be implemented to limit long working hours from both compliance and healthy-company perspectives.
The telework system accounts for a large proportion of our work style innovation. Although our system may appear to be a bit orthodox, Fujitsu has reviewed the flextime and discretionary labor systems and combined them with the telework system to realize an environment in which employees can work more flexibly.
With telework, Fujitsu has improved the following five points:
- Efficiency improvement
- Global work environment
- Work-life balance
- BCP support
These have made it possible to provide a safe, comfortable, and flexible work environment to employees, and many effects for the company have also been realized such as speedy customer service and decision-making as well as reduced communication costs.
Raising Employee Awareness Is the Key to Success
Fujitsu officially launched our telework system in April 2017. Before the launch, all employees were trained by e-learning and reflected on their ways of working, recognizing the "necessity of work style innovation" and their "current work styles."
Different types of people work long hours, including those who work overtime with no plan in mind, those who spend much time focusing on the details of their work, and those who work unnecessary overtime because others are still in the office. To improve this situation, we gathered information through e-learning, then identified and shared solutions and ideas for improvement.
Fujitsu implemented a telework trial for 400 employees at 10 offices and responded to questions from those who were unsure about how to effectively make use of telework through workshops and other activities.
Since introducing teleworking, Fujitsu has conducted periodic observations and questionnaires. The results indicate that working hours have been reduced by 10-20% compared to the previous year and we have seen a gradual improvement in the time when employees leave the office.
However, challenges remain. For example, there is a divergence in understanding of "work style innovation" between the management and regular employees, and there are opinions such as "Even though our office is doing telework on a trial basis, the atmosphere does not promote telework."
While some offices that participated in the trial developed their own activities from an early stage and produced extremely positive effects, others acted negatively. Work style innovation is a joint effort by both companies and employees; however, some employees do not fully recognize it as something they should concern themselves with, depending on their job type or how their leaders understand innovation, and this is a crucial point.
Based on these challenges, Fujitsu is providing workshops and other opportunities, gathering innovation staff members and supporting managers, and inviting outside facilitators in order to create spaces that encourage employees to consider work style innovation as something they should concern themselves with.
[Panel Discussion] Work Style Innovation Is None Other Than Business Model Transformation--Further Efforts Required
Prior to the panel discussion that followed the presentation, moderator Shunsuke Takahashi raised questions and made some comments. According to Mr. Takahashi, the weight of work style innovation's meaning differs depending on the type of industry, business, and problems of each company.
He presented four different perspectives on work style innovation:
- Defensive management: Health management and workplace safety
- Society's needs and securing the labor force: A society in which all 100 million people can play active roles
- Management fundamentals: Business models and productivity
- Workers' values: Diversity and creativity
He emphasized that top management must recognize work style innovation is none other than business model transformation.
He also noted the importance of considering how to effectively use the time saved by work style innovation: "Nothing will change without a positive attitude to make good use of the saved time. If you spend all your time at work in the office, your ability to create your own life will decline. How you spend the time saved by work style innovation is very important." (Mr. Takahashi)
Managers' Management Skills Necessary to Promote Work Style Innovation
"When a company steers itself towards work style innovation, it is important to absorb the anxiety and discontent that spread among employees and transform them into a sense of security. This will be the key to achieving successful innovation in the future," Mr. Ando said. "As long as we work with various people, we must understand that no one can work while ignoring the rules," he continued while citing traveling speeds on highways as an example.
In response to Mr. Ando's remarks, Mr. Takahashi said, "When actually trying to advance work style innovation, it may be necessary to change managers' management and communication styles, which can be a barrier to innovation."
Meanwhile, Mr. Sato explained that progress in work style innovation differs greatly depending on the workplace and employees: "Some people have already put work style innovation into practice, but others have not. We must carefully devise how to transform this situation for the better while taking our time."
At the end of the panel discussion, Mr. Takahashi asked, "What is the most important thing to do to promote work style innovation using ICT?" Mr. Sato concluded the panel discussion with these words: "Work style innovation is both 'awareness reform' and 'management skill reform.' I would like managers in particular to proceed by upgrading their skills at the same time that they make efforts to utilize ICT."
Munetomo Ando Associate Professor of Economics, University Research Center, Nihon University
Akihiko Sato General Manager, Labor Affairs Division, HR Group, Fujitsu Limited
Shunsuke Takahashi Project Professor, Graduate School of Media and Governance, Keio University