Connected Industries Tokyo Initiative /10/2

Transcription

1 Tentative translation Connected Industries Tokyo Initiative /10/2

2 Five Priority Fields Tackled under the Connected Industries Outline 1 Automated Driving and Mobility Service Identifying approaches for data harmonization Enhancing AI and related human resource development Establishing future vision of mobility service concerning logistics and EVs Manufacturing and Robotics International standardization of data rules including formats Enhancing inter-company collaboration in harmonized fields (e.g., cyber security and human resource development) Environmental improvement for the IoT introduction for SMEs, e.g., IoT tools Plant/Infrastructure Safety Management Improving technological capability for safety through utilizing IoT Developing guidelines and other common rules for harmonizing data across companies Promoting further reform of regulation systems Biotechnologies and Materials Achieving joint utilization of data across companies in harmonized fields Establishing an AI technology platform for commercialization Obtaining public acceptance Smart Life Discovering potential needs and materializing possible services Data collaboration through intercompany alliances Developing other rules for further data utilization Developing cross-sectoral support measures that bolster these efforts. 1

3 Cross-sectoral Policies under the Connected Industries Outline 2 Sharing and Utilization of Real-Data Establishing a new system for certifying data-sharing-businesses and introducing new tax-break programs. Supporting measures for developing AI systems through collaboration between large/medium companies, which hold real-data, and AI venture businesses Creating advanced models and then developing rules based on demonstration programs Revising the Contract Guidelines on Data Utilization Rights Environmental improvement for Data Utilization R&D, human resource development and cyber security Promoting development of innovative AI chips Enhancing efforts for human resource development in the field of data. (e.g., hybridtype in both virtual and physical systems, and in AI technologies) Building a framework to attract outstanding human resources from around the world Enhancing cybersecurity measures Further expansion of initiatives Global, venture and local companies and SMEs Enhancing worldwide cooperation especially with EU and Asian countries Promoting exports of Japan s systems through the International Collaboration Working Group Further improving the quality and quantity of human resources related to international standardization efforts Building Japanese venture ecosystems Enhancing support measures for local companies and SMEs by providing programs for developing or dispatching experts Enhancing support measures placing real-data, as its core. 2

4 Details of the Connected Industries Concept 3

5 Connected Industries - New vision for future Japanese Industries - Current situation Japanese industries are advancing digitalization of data for their establishments and factories as well as technologies and techniques, but the companies tend to manage the data in-house and tend not to collaborate on conducting these activities. Industry-academiagovernment collaborative efforts for encouraging discussions and study Sector-based efforts, e.g., mobility, manufacturing, biotechnology and materials, plant safety, smart life Cross-sectoral efforts, e.g., data utilization, standardization, IT human resources, cybersecurity, AI R&D Future goals Connecting data and using data efficiently will encourage innovation, better productivity and dissemination of technology. Connected Industries will become a strength for Japanese industries, such as Made-in-Japan products, Industrial Robots, Kaizen, etc. Analyzing data by AI Data for better productivity New services and solutions based on data Humans and robots working (in concept) together Dissemination of knowhow by data Disseminating to regional companies and SMEs. 4

6 [Reference] Birth of Connected Industries at CeBIT Japan attended CeBIT 2017, a global event for digital business held in Germany in March 2017, as a partner country. Prime Minster Abe, METI Minister Seko, and other Japanese officials attended the event. From Japan, a record-high number of 118 companies exhibited their products. Prime Minister Abe delivered a speech concerning the Connected Industries policy concept as an ideal approach that Japanese industries should aim for, stressing three pillars of the concept: [i] realization of a new digital society in which humans and machines or systems work together, [ii] solving challenges through cooperation and collaboration, and [iii] proactive development of human resources who can address the advancement of digital technologies. In addition, METI Minister Seko, MIC Minister Takaichi and Minister Zypries, Minister for Economic Affairs and Energy, Germany, concluded and released the Hannover Declaration as a Japan-Germany joint statement concerning the fourth industrial revolution. Taking this opportunity, Japan declared that it will advance the policy concept, an initiative for connecting people, machines and technologies across borders. Minister Abe delivering speech Meeting between Minister Seko and Minister Zypries 5

7 Society 5.0 and Connected Industries <Society> Primitive society Agricultur al society Industrial society Digital society Society 5.0 Ultra-smart society Connected Industries New value created by various connections Collaboration of Individuals Creating new business models Creation of a new society (Human-centric & Solution-oriented) <Industry> <Technology> Development of private companies Things Things Humans Machines/Systems Companies Companies Humans Humans (Dissemination of knowledge and skills) Suppliers Customers Large companies x SMEs Regions Regions Fields Digital Various forms of collaboration First Industrial Revolution - Acquisition of power (steam engine) Second Industrial Revolution - Power innovation (electric power, motors) Third Industrial Revolution - Advance of automation (computers) Fourth Industrial Revolution - Autonomy based on Bigdata, AI and IoT 6

8 What is Connected Industries? Connecting a variety of industries, companies, people, machines, data and other social elements, contributing to... Creating new added value and products/services using AI, etc., and improving productivity for... Solving social challenges, such as Aging society, Labor shortages, Environment and Energy restrictions, etc. Enhancing industrial competitiveness Improving people s lives Promoting the healthy development of the national economy Currently, businesses connect in a variety of ways depending on sectors or business conditions, levels of effort necessary for introducing IT, and other issues. Some businesses may keep their connection within their factories, while others may connect with their business partners or other companies in the same sector, or directly connect with their customers or markets. Connecting industries beyond the existing business relationships may establish a new industrial structure. 7

9 Specific initiatives of Connected Industries Japan should identify five priority fields from the viewpoints of potential market growth, Japanese industry advantages, and scale of public significance, and should accelerate efforts and invest intensively in policy resources in such fields. Moreover, it should develop support measures, legal systems and other environments to accomplish cross-sectoral tasks. Priority Fields (Working Groups) Automated Driving and Mobility Services Manufacturing and Robotics Biotechnologies and Materials Plant/Infrastructure Safety Management Smart Life Visions (public significance) Market growth, Predicted economic effect Promoter Cross-sectoral tasks Reduction of traffic accidents Alleviation of traffic congestion Decrease of environmental load Distributed Energy Management Expansion of mobile services, including distribution Estimated effect in the autonomous-driving vehicles market: Approx. 87 billion USD Estimated effect by having drivers shift their time for driving to that for increasing productivity and consuming services: Approx. 100 billion to 1 trillion USD Panel on Business Strategy of Automated Driving (Study Group for Strategies for Mobility Service Industries (tentative title) to be established) Overall optimization of production Non-stop factories Decrease of accidents and environmental load The industrial internet market will boost the global GDP by 10 trillion to 15 trillion USD within the coming two decades. RRI (Robot Revolution Initiative of Japan) Data sharing and utilization including cooperative areas Dedicated reinforcement of top human resources development Dramatically strengthening efforts for developing world-top-class quality human resources Strategic application of international standards Promoting international collaboration concerning data rules (deepening the Japan-EU Data Economy Dialogue) Promotion of and support for Connected Industries in SMEs Innovative materials and medical care/drug development Measures for energy resources Creation of innovative materials for societal reform Estimated growth of the global biotechnology market value: Approx. 1.6 trillion USD by 2030 Estimated effect of global functional raw-materials markets: Approx. 50 trillion JPY COCN, Japan Chemical Industry Association Improvement of factory safety and productivity Internal improvement of security and creation of earning power Effective utilization of sensors, drones and other advanced technologies Worldwide market value resulting from efforts to address aging infrastructure and expanding demand therefor: Approx. 200 trillion JPY Council for Promoting Utilization of Plant Data and Other Information Smart-life markets as an alternative for unpaid work to overcome labor shortages and other societal challenges in Japan, amid the advancement of the aging society with fewer children, thereby creating employment (labor hours). Money valuation of unpaid work in 2011: Approx. 100 trillion JPY (c.f., the home appliances market: Approx. 7 trillion JPY) IoT Acceleration Lab Further developmental support of AI systems and overseas expansion Embodying examination of legal matters concerning AI ( AI responsibility theory, etc.) Implementation of cybersecurity measures Further discussed: Back-office reforms, Fintech, etc. 8

10 1. Specific initiatives of Priority Fields -Automated Driving and Mobility Service -Manufacturing and Robotics -Biotechnologies and Materials -Plant/Infrastructure Safety Management -Smart Life 9

11 [Automated Driving and Mobility Services] Directions of future efforts Working Group [i] Automated Driving and Mobility Services <Overview of efforts> Challenges that Japan needs to overcome Japan aims to accomplish: reduction in car accidents, alleviation of traffic congestion and decrease of environmental load, contributing to safe and smooth road traffic; improving the comfort of driving, supporting the elderly and other vulnerable road users in traveling comfortably and creating a society in which more and more people are able to travel comfortably; and international competitiveness of the automobile-related industries involved in autonomous driving technology. Streamlining of current situation Some businesses inside and outside Japan will launch mobility services with unmanned cars around Japanese and western automobile manufacturers were leading the rest of the world, however domestic manufacturers have fallen behind Western manufacturers in the components and software areas for autonomous driving. This trend is encouraging a growing number of non-automobile companies to newly enter the industry, leaving Japanese manufacturers further behind. Major past efforts Aiming to secure Japan s global competitiveness in the field of autonomous driving and to proactively contribute to solving societal challenges, e.g., reduction of global car accidents, in February 2015, METI and the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) jointly established a Panel on Business Strategy of Automated Driving as an opportunity for discussing issues between the Director-General of the Manufacturing Industries Bureau of METI and the Director-General of the Road Transport Bureau of MLIT. The panel aims to analyze current challenges and hold discussions concerning necessary efforts. Directions of future efforts Improve and deepen demonstration tests, efforts indispensable for public implementation of autonomous driving, and also advance efforts for sharing data on the test results throughout industries; organize the common use of potentially-shared infrastructures (maps for autonomous driving, databases for development, etc.) and public-private cooperation so as to deepen and expand areas for cooperation initiatives in data utilization; and furthermore, start discussing issues involving the development of the human resources capable of developing autonomous driving technology, etc., which are areas that have not been discussed enough as areas for cooperation. The Working Group will, it needs to examine ideal approaches to providing total-mobility services, e.g., connected cars and shared services, while maintaining a focus on autonomous-driving issues in discussions. 10

12 [Automated Driving] Working Group s approaches to discussions [i] Working Group [i] Automated Driving and Mobility Services Points of contention directing discussions in the working group <Data cooperation> Utilization of map data and data on moving pictures shot from moving vehicles that the government has collected; maximization of scope of data to be shared Discuss specifications and business models of high-precision maps and map data, including for general roads. Discuss basic policies for the utilization of images shot from moving vehicles that the government has collected by commissioning the project to JARI. Discuss, from the standpoint of maximizing the scope of areas for cooperation, whether or not datasharing among industries would create more value-added data or bring about data that can be shared across industries, while bearing in mind matters that are sensitive to competition. <Development of AI systems> Detection of obstacles in remote operation; utilization of data collected during the Last Mile Demonstration Test Project Discuss the Last Mile Demonstration Test Project, focusing on ideal approaches to developing systems in which AIs for machine learning are utilized along with other methods to recognize passengers and to efficiently operate vehicles even in the complex environments where passengers and vehicles interact during remote monitoring or other operations. Discuss basic policies for the utilization of the large amount of data to be collected during the FY2017 and FY2018 Last Mile Demonstration Test Projects, basing development efforts on AI-based systems for recognizing environments and efficient vehicle operations. <Human resource development> Development of human resources to lead the fields of monodzukuri and digitalization Aim to establish a system for the development of human resources with expertise in simulation, while training human resources with the necessary development skill, against the backdrop of the shortage of human resources with expertise in the field of software necessary for developing autonomous driving technology. 11

13 [Automated driving] Working group s approaches to discussions [ii] Working Group [i] Automated Driving and Mobility Services Points of contention directing discussions (continued from the previous page) <International standards> Submission of proposals for international standardization Japan has been serving in the post of chairman at the ISO subcommittees or working groups proactively committed to autonomous driving technology, and submitting proposals to the ISO for establishing a variety of new international standards in cooperation with other member countries, in the context of related projects (international standardization for advanced road transportation system and establishment of bases for popularization of these standards). Other organizations have been handling this subject, so the working group will not discuss it. <Cybersecurity> Sharing information on cybersecurity incidents; development of assessment environments (*This is a leading effort, and certain measures have already been conducted for part of the effort.) Japan Automobile Manufacturers Association, Inc. has established a system for sharing information on these incidents. It aims to develop an assessment environment (test beds) by the end of FY2019 and commercialize the environment. The working group will discuss necessary basic policies. <Working group s promotion system > Discussion opportunity: In February 2015, a Panel on Automated Driving Business Strategy was established as a forum for discussing issues between the Director-General of the Manufacturing Industries Bureau of METI and the Director-General of the Road Transport Bureau of MLIT (posts equivalent to vice president and managing director in private companies). In addition to this panel, METI established a regular meeting for manager-level posts, as a forum for discussing more practical matters. Since then, the meeting has been holding discussions. Member companies: Toyota, Nissan, Honda, Mazda, Subaru, Isuzu, Denso, Hitachi Automotive Systems, Panasonic, JTEKT, Fujitsu Ten, etc. <Global trends Japan should bear in mind> ISO/SAE, the Working Group for Autonomous Driving and the Expert Meeting on Autonomous Steering of the United Nations Economic Commission for Europe (UNECE), the World Forum for Harmonization of Vehicle Regulations, and Japan-Germany collaboration 12

14 [Mobility Services] Popularization of MaaS (Mobility as a Service) Mobility service architectures Diagram of shift to new social systems Application PF Infrastructures Distribution Mobile services Cooperative delivery, sharing Optimization of car allocation/positioning Energy Management and control Demand forecasting Entertainment, etc. Navigation Position, sound Bases for data distribution and processing (API) Recognition/ decision-making(ai) Communication services Mapping Autonomous-driving systems (software) Interface Vehicles, railways, drones, aircraft (sensors, storage batteries, on-board semiconductors, etc.) Introduction of autonomous-driving vehicles, electric facilities and new services Service Data collaboration and optimization Market Management Sharing EVs/ stations therefor Supplydemand adjustment Big Data Dynamic pricing Transportation On peak-off peak adjustment Improving loading ratios Inter-supplychain data collaboration Energy Establishing the overseas situation as a benchmark, METI should smoothly establish a study team across related bureaus, e.g., the Manufacturing Industries Bureau and the Commerce and Information Policy Bureau, aiming to discuss future directions of Japan s efforts. 13

15 [Manufacturing and Robotics] Directions of Future Efforts Working Group [ii] Manufacturing and Robotics <Overview of the efforts for the field of manufacturing and robotics> Challenges that Japan needs to overcome Value creation taking advantage of Japan s strengths (providing solutions that take advantage of cutting edge strengths, etc.), also from the standpoint of competing with leading Western and other companies, and also the need to overcome labor shortages in Japan. Organizing of current situation Fortify major countries efforts toward the promotion of the smart manufacturing concept; as Japan boasts outstanding manufacturers in the machinery sectors and some have significant competitiveness over foreign companies, such manufacturers need to win corporate value through the solution-oriented initiatives that solve problems faced by society and consumers, utilizing human-centered approaches that leverage quality technologies and factory floor performance as their strong points. Major past efforts RRI was established in 2015; action groups and other committees for particular area for cooperation were organized under the RRI in 2016; Japan-Germany collaboration has been advancing since 2016 in particular, and Japan and Germany concluded the Hannover Declaration at CeBIT in 2017; additionally, some field-based expert meetings have been held periodically. Future efforts Further deepen discussions for maximizing the scope for areas for cooperation (international standardization, cybersecurity, etc.), an effort that RRI has been advancing with the involvement of major leading companies; start new discussions concerning the development of human resources to lead the fields of manufacturing and digitalization, considering this subject an area for cooperation. 14

16 [Manufacturing and Robotics] Working group s approaches to discussions [i] Points of contention directing working group discussions Working Group [ii] Manufacturing and Robotics <International standards> Formulation of rules on describing data (data profiling), international standardization thereof Formulate a proposal for new standards for data profiling through the Project for Smart Plant Demonstration Tests, to ensure data collaboration inside and outside factories; discuss proposals for proactively utilizing the proposed standards as domestic standards in industry. Also strengthen efforts for international standardization concerning the technologies in the formulated proposal. <Cybersecurity> Discussion on formulating guidelines for the manufacturing industry, international standardization thereof Cybersecurity measures introduced into factory floors in the manufacturing industry are different from those in the IT field in many respects. To overcome such differences, efforts for awareness-raising and enhancement measures are necessary. To this end, the working group will fortify specific efforts, e.g., discussing the formulation of cybersecurity guidelines for the manufacturing industry, and also promote efforts aiming at international standardization of the guidelines. <Data cooperation> Assessment and revision of the Contract Guidelines on Data Utilization Rights, maximization of the scope of data to be shared Concerning the Contract Guidelines on Data Utilization Rights formulated in the spring of 2017, discuss issues and obstacles discovered as a result of having introduced the guidelines into demonstration projects and other actions, and also discuss the revision of the guidelines when necessary. Discuss, from the standpoint of maximizing the scope of areas for cooperation, whether or not data-sharing among industries (while bearing in mind matters that are sensitive to competition) would create more value-added data, or bring about data that can be shared across industries. <Human resource development> Development of human resources who lead the fields of monodzukuri and digitalization Clarify the scope of necessary human resources (e.g., those with expertise in both the fields of monodzukuri and IT and those necessary for promoting the introduction of digital technologies and robots) and the initiatives that industry, academia and government sectors should engage in, thereby leading to specific actions (e.g., introducing the achievements of related initiatives into the development of school curricula by educational institutes or other entities from 15

17 Working Group [ii] Manufacturing and Robotics [Manufacturing and Robotics] Working group s approaches to discussions [ii] <SMEs> Support measures for SMEs in introducing digital and other technologies, disseminating the significance and importance of the Connected Industries policy concept to SMEs Discuss and implement [i] support measures for SMEs in proactively introducing digital technologies and robots (e.g., improvement of the Project for Dispatch of Supporting Teams for Smart Manufacturing) and collaboration and harmonization of the processes involving EDI from receiving orders to receiving money, and [ii] measures for simple communication of the policy concept to management, so as to improve the productivity of SMEs. <R&D> Efforts for engaging in common fundamental technologies, development of an industry-academia collaboration framework Discuss common fundamental technologies and other issues that the government should engage in across ministries; discuss an effective industry-academia-government collaboration framework to communicate specific improvement measures and other efforts to the public. <Use cases> Acceleration of information-sharing on best practices Accelerate information-sharing on best practices for improving productivity through the utilization of IoT and other initiatives. * Also discuss the establishment of a meeting in which robots and drones will be discussed as a priority. <Working group promotion system> Provider of discussion opportunities: RRI - *In addition to meetings of the members of the Round Table Conference on the Connected Industries Concept Policy with METI Minister Seko, establish a director-general-level meeting as a forum for discussing practical matters (also taking advantage of RRI s existing discussion opportunities), and discuss related issues at the meeting, bringing together representatives of venture businesses and other entities. Members: Mr. Inaba, Chairman (FANUC Corporation; Japan Robot Association), Mr. Omiya, Chairman of the Board (Mitsubishi Heavy Industry; RRI), Mr. Higashihara, President (Hitachi, Ltd.), Mr. Mimura, Chairman (Nippon Steel & Sumitomo Metal Corporation; Japan Chamber of Commerce and Industry), Mr. Mori, President (DMG Mori Co., Ltd.; Japan Machine Tool Builders Association), Mr. Yamanishi, Chairman (Mitsubishi Electric Corporation; Keidanren), and others <Global trends Japan should bear in mind> Japan-Germany collaboration, ISO/IEC, RRI international symposiums, etc. 16

18 [Biotechnologies and Materials] Directions of Future Efforts Working Group [iii] Biotechnologies and Materials <Overview of efforts for the fields of biotechnologies and materials> Challenges that Japan needs to overcome Establishment of counter measures against foreign companies, making use of Japan s advantage in technologies and markets, promotion of utilizing biological resources maintained by companies and other entities as data, and appropriate designing of new systems to expand the markets of bio-materials; Creation of new business domains through data collaboration between companies and users/consumers, enhancement of companies abilities to develop materials (materials informatics), and measures for addressing the next-generation production systems to create new value added, along with changes in a digital society; and discussions on ideal industries of biotechnologies and materials to advance these measures. Streamlining of current situation The OECD estimates that the global markets for biotechnologies will expand to the 200 trillion yen-scale by Western countries have formulated strategies in these fields and are promoting the shift of their current strategies to those for a bioeconomy, while taking advantage of regulations to encourage businesses. The global market scale of functional chemicals is approximately 50 trillion yen, of which that for electronic materials, an area in which Japan has strength, accounts for approximately 3 trillion yen. The user industry has been making the product cycle shorter, and the commoditization of materials per se has been dramatically advancing due to the new entry of manufacturers in emerging countries. Major past efforts The Investments for the Future Strategy 2017 stipulates a policy that Japan should formulate government approaches to achieving a healthy society, or society in which people are able to identify presymptomatic health risks and a carbon cycling society enabled through innovative bio-materials. Moreover, under the industry-academiagovernment collaboration framework, research and development projects for establishing a data platform and other efforts were conducted. Directions of future efforts Advance specific discussions in collaboration with industrial players to achieve data collaboration in cooperation areas; discuss effective efforts not only for R&D but also for securing measures for promoting the introduction of data collaboration as well as social acceptability. 17

19 [Biotechnologies and Materials] Working Group s approach to discussions [i] Working Group [iii] Biotechnologies and Materials Points of contention on which the working group will advance discussions <Data cooperation> Establishment of data platform and setting cooperation areas Discuss approaches to cooperation areas and frameworks, e.g., rules for proving data, so as to establish a data infrastructure for biological resources and materials development. Discuss ideal approaches to data collaboration in overall supply chains ranging from downstream companies on the material-industry side to final users. <International standards> Standardization of databases, labeling and certification systems, etc. Discuss standardization of data formats in cooperation areas and standardization of characteristics assessment of new materials. Discuss ideal approaches to new frameworks and systems, e.g., labeling or certification involving carbon-cycling materials, to implement innovative bio-materials in society, and establish a Japan-EU cooperation system. <Human resource development> Biotechnologies/materials x IT and data Discuss and clarify initiatives that the industry, academia and government sectors should tackle to develop human resources who have expertise in materials development or in both the fields of biotechnology and IT (e.g., bio-informaticians). <Development of AI systems and other R&D> Establishment of AI technology platforms Engage in accelerated commercialization of achievements made by NEDO derived from its project for analyzing biological information and developing design systems; also discuss ideal approaches to developing further data and AI systems, e.g., bioprocess control by AI, and discuss technical challenges therein. Further advance collaboration with other projects, e.g., ongoing projects for establishing data platforms undertaken by the related ministries and agencies (e.g., the Cabinet Office and the Ministry of Education, Culture, Sports, Science and Technology). 18

20 [Biotechnologies and Materials] Working Group s approach to discussions [ii] Working Group [iii] Biotechnologies and Materials Points of contention from which the working group will advance discussions (continued from the previous page) <Others> Discuss other potential data-cooperation areas (e.g., human resources, know-how and development of shared demonstration plants) to be promoted aiming to expand the production scale of bio-materials for commercialization. Discuss and clarify challenges in the introduction of outstanding food functions and bio-materials and challenges in regulations for new technologies (e.g., genome-editing technology); discuss ideal approaches to the fields of biotechnologies and materials in light of the points of contention above. <Working Group s promotion system > Provider of discussion opportunities: Joint working group of COCN and Japan Chemical Industry Association Member companies: Mitsubishi Chemical Corporation, Sumitomo Chemical Company, Limited, Hitachi, Ltd., Kirin Company, Limited, etc. <Global trends Japan should bear in mind> The European Commission (EC), the Global Bioeconomy Summit, the World Economic Forum (WEF; study on circular economy), the nano tech, NIST, etc. 19

21 [Plant/Infrastructure Safety Management] Directions of Future Efforts Working Group [iv] Plant/Infrastructure Safety Management <Overview of the efforts for the fields of plant/infrastructure safety management> Challenges that Japan needs to overcome Many Japanese facilities are facing difficulties in the aging instruments and the retirement of expert or skilled employees who played key roles in plant maintenance and safety. The possibility of major accidents is increasing. Streamlining of current situation Companies should effectively and efficiently utilize IoT, big data and other advanced technologies, enhance their voluntary procedures addressing plant safety, and improve their earning power. Their current involvement in advancing data utilization efforts is insufficient. To address this situation, the petroleum refining and chemicals industries have conducted to the demonstration projects for IoT and other advanced technologies to improve their techniques for voluntary procedures addressing plant safety, while the electricity industry has been engaging in voluntary-basis efforts for enhancing techniques for self-motivated security, mainly in thermal-power-generation facilities by making use of a variety of sensors so as to make maintenance and inspection more efficient. Major past efforts Japan continually revised related regulations (standardization of functions, introduction of positive incentives), and supported companies in developing technologies through IoT demonstration projects. Directions of future efforts Advance the efforts for reviewing of the system and the demonstration projects as well as those for developing systems for promoting innovations (e.g., ESG investment and procurement, and exports of system infrastructures) making use of market mechanisms, thereby building the safety ecosystem, covering technologies, society, markets and other social elements, and aiming at increase of safety and productivity. 20

22 Common challenges seen in the projects (important points of contention for the working group) [Plant/Infrastructure Safety Management] Working Group s approaches to discussions [i] Achievements in demonstration projects and future prospects Establishme nt of a Database for General Damage- Probability (High Pressure Gas Safety Office ) Corrosion Prediction of External Surfaces (Material Industries Division) Corrosion Prediction of Internal Surfaces (Petroleum Refining and Reserve Division) Achievements A shift of approach from timebased maintenance to quantitative risk-based maintenance (RBM) was required to make safety more efficient. A foundation of such a database was built making use of overseas data. Some companies established their own models for corrosion prediction of external surfaces of pipes, but these models contain a small amount of data and provide low prediction accuracy. Past-inspection data concerning the corrosion of external surfaces of pipes from 13 companies in the chemical industry was aggregated and a prediction model was established. Facilities of oil refineries in Japan were less reliable in terms of operation than those in large oil refineries in other Asian countries. Pipes caused 50% of the problems in such refineries in Japan. A prediction model of internal corrosion of pipes was established. Versatility of the model was confirmed. Challenges Enhancement of reliability by increasing the number of samples Demonstration of the quantitative RBM making use of the database in plants under operation Enhancement of reliability of the model by increasing the number of samples Application of a prediction model to a safety plan in plants under operation Increase the sophistication of the model Development of an environment in which oil companies are able to commonly use the model in broad fields Working Group [iv] Plant/Infrastructure Safety Management Future prospects [Up to FY2018] Improve the reliability of the database by collecting domestic data Demonstrate the quantitative RBM making use of the database in oil refineries [FY2019] The High Pressure Institute of Japan will sell the quantitative RBM and other approaches making use of the database and aim to operate the RBM for itself. [Up to FY2018] Improve reliability of the model by adding new real data [FY2019] Aims to create a framework under which participating companies can continuously aggregate their data in industrial associations or vendors and access regularly-updated data. [Up to FY2018] Increase the sophistication of the model by elaborating the function for predicting damages Develop and demonstrate a platform commonly used among companies [FY2019] Establish the prediction model in the platform and conduct demonstration toward release to the public 21

23 [Plant/Infrastructure Safety Management] Working Group s approach to discussions [ii] Working Group [iv] Plant/Infrastructure Safety Management Points of contention from which the working group will advance discussions Common challenges discovered in conducting demonstration projects as discussion opportunities and conduct related efforts <Data cooperation> Formulation of guidelines for companies in concluding confidentiality contracts and other agreements exclusively for the fields of safety of plants and infrastructures Cross-company data sharing has not always sufficiently advanced, while cooperation areas in the field of safety are considered to be more extensive. To address this situation, the working group streamlined categories of competitive areas and cooperation areas among companies, and then formulated guidelines exclusively for the fields of plant and infrastructure security based on the Contract Guidelines on Data Utilization Rights. Through this effort, the working group aim to improve voluntary procedures of plant safety and productivity. <Human resource development> Discuss ideal approaches to human resource development, prepare educational materials and other tools therefor In introducing AI and other advanced technologies into companies, engineers with expert knowledge concerning factory floors should effectively utilize technologies, while companies should prevent fields operators from losing necessary skills due to decreasing opportunities to acquire experience. It is expected to establish support measures for developing human resources with expertise in utilizing technologies. In addition, it will discuss ideal approaches to developing human resources, following streamlining of roles played by people and AI or other systems on factory floors, and will also prepare educational materials and other tools. <Cybersecurity> Formulation of cybersecurity guidelines exclusively for the fields of safety of plants and infrastructures It is considered important to overcome the current situation where companies are likely to delay the introduction of IoT due to concerns over cyber attacks that may cause serious accidents and leakage of information on manufacturing processes. And, it is important to enhance countermeasures for cyber attacks on essential utilities that may cause serious adverse impact on companies. To this end, the working group will formulate guidelines exclusively for safety of plant and infrastructure based on the existing Manual for Addressing CPS/IoT and other guidelines. 22

24 [Plant/Infrastructure Safety Management] Working Group s approach to discussions [iii] Working Group [iv] Plant/Infrastructure Safety Management Points of contention from which the working group will advance discussions (continued from the previous page) <International business development> Development of the Smart Industrial Safety (SIS) in foreign countries Sophisticated security technologies and maintenance services business should be developed in foreign countries, where the sophisticated safety is needed. In Thailand, a Japanese company already engaged in maintenance services for regulator valves (important equipment in plants). Moreover, the electricity industry utilizing the big data-analysis technology for prompt failures in thermal power plants, and this technology is expected to be developed in foreign countries. <Encouraging companies to utilize IoT equipment> Proactive utilization of drones, sensors, tablet terminals and other devices Proactive utilization of drones, sensors and other devices is indispensable for companies to efficiently collect big data from large plants. Moreover, utilization of tablet terminals and other devices that connect systems and employees on the factory floors are necessary for companies to be able to utilize prediction models through IoT, AI and other advanced technologies. METI will encourage companies to make use of such devices so as to further encourage companies to utilize data in plants. <Working Group s promotion system > Provider of discussion opportunities: Council for Promoting Utilization of Plant (each three meetings are scheduled to be held in FY2018) Members: Industrial associations (Petroleum Association of Japan, Japan Petrochemical Industry Association, and Japan Chemical Industry Association ) Experts (National Institute of Advanced Industrial Science and Technology, the University of Electro-Communications, IoT business experts (including venture business owners), etc.) Providers of demonstration projects (petroleum, chemical, vendor and other industries) Other businesses (electricity, gas, plant engineering and other industries) <Global trends Japan should bear in mind> CCPS international conferences, economic missions dispatched to Thailand, ISO/IEC, etc. 23

25 [Reference] Examples of efforts in the field of electricity Working Group [iv] Plant/Infrastructure Safety Management Utilization of big data Ascertaining signs of abnormality Chubu Electric Power Co., Inc. has developed an operation support system by combining its own sophisticated technology for operation security involving thermal power plants and the data analysis technology maintained by NEC Corporation. In this system, the company ascertains changes in situation, abnormality and other events of plants based on a large amount of plant data to be able to maintain the optimal operation of plants (with high efficiency and high operation rates) by quickly addressing such changes and also to prevent failures of the plants. Utilization of AI Introduction of automatic operation and overseas development Mitsubishi Hitachi Power Systems, Ltd. has developed a system in which boiler coal combustion is automatically adjusted using AI, and it achieved highly accurate adjustment of such combustion controlled by expert engineers. This system was introduced into Linkou Coal-fired Power Plant operated by Taiwan Power Company, a staterun company in Taiwan, and the plant has been running for commercial purposes. Utilization of the latest equipment Automatic inspection making use of drones, etc. Tokyo Electric Power Company Holdings, Inc. has developed a system for automatically inspecting power facilities using drones flying along power cables and also introduced sensors for monitoring partial discharge. The company has achieved continuous monitoring of power transmission cables. [Source] [Source] Excerpt from the material prepared by Chubu Electric Power Co., Inc. Linkou Coal-fired Power Plant by Taiwan Power Company [Source] Prepared by METI based on MHPS news release on Jan. 10, 2017 [Source] Excerpt from the material distributed at the 15th meeting of the Electric Power Safety Subcommittee 24

26 [Smart Life] Directions of Future Efforts Working Group [v] Smart Life <Overview of efforts for the field of smart life> Challenges that Japan needs to overcome Amid the advancement of the aging society with fewer children, smart-life markets as an alternative for unpaid work (e.g., household labor) to overcome labor shortages and other social challenges in Japan should contribute to creating employment (labor hours). Scale of the household-labor market is estimated to be about 100 trillion yen, while that of the home appliance markets is about 7 trillion yen. *According to the Report on Assessment of Household Activities released by the Cabinet Office, money valuation of unpaid work in 2011 is estimated to be from 108 trillion yen to 97 trillion yen. Streamlining of current situation Conventionally, the smart life (home) efforts have been those for making power visible, mainly placing energy conservation at the core. However, these efforts are now conducted within a very limited range, while some businesses have started networking of devices and providing related services. Accordingly, the development of environments for creating a smart life market effectively taking advantage of life data is important. Major past efforts The Data Distribution Promotion Working Group under the IoT Acceleration Consortium has been promoting discussions on formulating guidelines for data utilization. Moreover, in FY2017, the Study Group for Smart Homes started a monitoring demonstration project concerning cooperation areas (data collaboration, security/product safety, and privacy) to develop environments connectable to each other. Directions of future efforts To overcome the current situation where companies tend to keep data and customers and to face risks in leakage of personal information when in use, advance efforts, including [i] those for advancing inter-company alliance through data collaboration, and [ii] streamlining of cross-sectoral cooperation areas (e.g., data portability) and issuance of new guidelines, by encouraging the management of major companies to engage in these efforts. 25

27 [Smart Life] Working Group s approach to discussions [i] Working Group [v] Smart Life Points of contention from which the working group will advance discussions <Use cases> Discussion concerning policies for the creation of a smart home market The most important challenge in this field lies in the discovery of customers needs in the service area. METI should hold discussions with a variety of people across industries concerning the target visions of everyday life, aiming to create new services that will solve challenges, for e.g., measures for the elderly and relaxing burdens of household labor. Moreover, through the efforts by the IoT Acceleration Lab, METI will also discuss support measures for the establishment of inter-company alliances and the promotion of data collaboration, thereby aiming to specify services. <Data cooperation> Discussion concerning common rules to expand the smart home market From the viewpoint of maximizing cooperation areas, hold discussions concerning data that companies are able to gain more value from through data sharing, while bearing in mind the borders of competitive areas, as well as data that companies are able to share in their own industries as a whole. Discuss cross-sectoral systems and other schemes, e.g., ideal approaches to data transaction among businesses <Security, etc.> Discussion concerning the preparation of new guidelines for the field of smart homes A variety of businesses are expected to enter this field, including housing manufacturers, home appliance manufacturers, electricity/gas utilities, retailers/distributors, and sharing businesses. Measures that they may request vary depending on their respective standpoints. METI will formulate new guidelines for security in the field of smart life, taking into account this background. 26

28 [Smart Life] Working Group s approach to discussions [ii] Working Group [v] Smart Life Points of contention from which the working group will advance discussions (continued from the previous page) <Data utilization> Discussion concerning the preparation of new guidelines for the field of smart homes Concerning approaches to acquiring and distributing data, consider the technological, systematic, and socially-acceptable viewpoints, expecting that a variety of businesses may enter into the market, and based on this, discuss the formulation of new guidelines and other issues with related ministries and agencies and experts. <Working Group s promotion system > Working Group: IoT Acceleration Lab Members: Some members of the IoT Support Committee, Data Distribution Promotion WG; Experts in the fields of digital, IT, standards, security, privacy, etc.; Business representatives in the fields of home appliances, housing, security guards, insurance, data distribution, etc. <Global trends Japan should bear in mind> CES (home appliance exhibition in the U.S.), IFA (home appliance exhibition in Germany), CEATEC (IoT exhibition in Japan), etc. 27

29 Data collaboration and provision [Reference] Diagram of Smart Life Working Group [v] Smart Life Inter-company alliances through data collaboration will help connect all information related to everyday life, e.g., that involving home appliances, thereby allowing businesses to provide services that solve inconvenient matters in everyday life. To achieve this goal, Japan should develop related rules, e.g., those for security and privacy, as a foundation of this goal. Looking at overseas countries, platform creators have already embarked on provision of solutions covering data acquisition to service provision. Safety Worrisome issues Cannot adjust time to receive a parcel from a deliverer Household labor Think it trouble to go out for shopping Have no mobility means to reach supermarkets Have no time for cooking, washing clothes, or cleaning Health Cannot manage daily health Wish to avoid developing dementia Medical care Have trouble in visiting hospitals No sharing of my medical card among hospitals Nursing care Wish to prevent elderly parents from causing accidents in restrooms Afraid of a lonely death Child rearing Wish to remotely confirm my kids coming back home Printed documents as the only means to communicate with schools Wish to send my kids to cram schools, but cannot due to expensive tuition New services for everyday life could be provided by data aggregation and utilization through home appliances and other devices. Development of related rules, e.g., those for security and privacy Home appliance market: Approx. 7 trillion yen Solutions that may be available Safety IoT parcel delivery (delivery completed even when not at home + smart locking) Household labor Services for offering recipes and online meal delivery On-demand transportation solutions Housekeeping services, remote control of home appliances Health Device-based data-collaboration solutions Communication robots Medical care Remote medical examination services Digitalization of medication notebooks and maternal and child handbooks Nursing care Bathroom-monitoring solutions Detection of abnormal situation through monitoring by home appliances Child rearing Access-monitoring solutions ICT-based communication Online learning services Household labor market: Approx. 100 trillion yen 28

30 2. Study on Cross-sectoral Policies 29

31 Certification (1) Promotion of Data Utilization Including Data in Cooperation Areas With the ever-increasing volume and flow of data due to the advancement of digitalization, IoT etc., METI should aim to disrupt the self-sufficiency and excessive enclosure of data, encouraging the utilization of the data to solve societal problems. To this end, it should hold discussions concerning a new system in which a competent minister can certify and support efforts by private companies for data sharing in specific areas for cooperation. Data-holding business Data-holding business Data-holding business Provide Data Example of data: Data on: Energy, Industrial machinery, Distribution, etc. Scheme (draft) Government (Competent Minister) Filing request Data-sharing business Data provision Data-utilizing business Data-utilizing business Data-utilizing business Data utilization for solving societal problems (prevention of accidents, energy management, overcoming labor shortages, infrastructure development, etc.) Key points of the system (under discussion) (1) Establishment of a certification system for data-sharing businesses Under this system, the government will certify plans for data sharing projects in which businesses share data in specific cooperative areas. This system will provide support measures that encourage businesses to utilize data, aiming to collect additional data and solve societal problems. (2) Establishment of a system in which businesses are able to request data to be provided In this system, data-sharing businesses are eligible to make requests of related ministries and agencies, through competent ministers, to provide them with specific data that such ministries hold. (3) Audit of security by the public sector Aiming to make full efforts for cyber security measures targeting data-sharing businesses, METI will conduct audits and investigations. (4) Support measures METI will submit a request for a tax break system targeting efforts under the Connected Industries policy concept. (5) Guidance and advice, on-site inspection, and cancellation 30

32 (2) Support for the Development of AI Chips, Support for the Development of AI Systems Aiming to promote frontier technological development, one of Japan s strong points, establishment of core technologies is important through collaboration between venture businesses having advanced technologies and large or medium companies. To this end, METI will provide financial support for R&D involving such initiatives. As global society is facing a dramatic increase in the amount of data distribution, a key to improving competitiveness of Japanese companies lies in AI system development through collaboration between large or medium companies and AI venture businesses. METI should discuss support measures for developing such a system, also taking advantage of MITOU human resources. AI system development support Consultation service for AI utilization, provision of data [Case examples of collaboration with large companies] Large automobile company x AI venture business Joint R&D involving AI technologies in the field of mobility business Large or medium companies (large amount of real data) MITOU human resources / AI venture businesses (1,700-level human resources in total) Provision of ideas and prototypes Large machine-tool company x AI venture business Design of areas for deep-leaning, development of application Large air-conditioner manufacturer x AI venture business Technologies for sensing the situation of facilities under operation, detecting abnormality, finding failure signs, etc. Accelerate the collaboration of large / medium companies and AI venture businesses / innovative human resources Funding to R&D or system development / implementation 31

33 (3) Development of Frameworks for Further Acceleration of International Collaboration An International Collaboration Working Group has been established - the fifth such WG under the IoT Acceleration Consortium - and METI and MIC will cooperate in this field. The International Collaboration WG will approve the establishment of its sub-working groups. Enhancing the framework of the IoT Acceleration Consortium General Meeting Technology Development WG IoT Security WG Chairperson Vicechairpersons Jun Murai, Dean / Professor, Faculty of Environment and Information Studies, Keio University Hiroo Unoura, President, Nippon Telegraph and Telephone Corporation Hiroaki Nakanishi, Chairman of the Board and Representative Executive Officer, Hitachi, Ltd. International Collaboration WG Organizer Establishment of an International Collaboration WG METI-MIC cooperation The International Collaboration WG aims to: Respond to the needs of partner countries and introduce Japanese companies that are able to cooperate with them Member companies participate in efforts if they are interested. * About 2,700 member companies of the IoT Acceleration Lab The government will provide support for overseas marketing of technologies. Data Flow Promotion WG Advanced Model Business Promotion WG (IoT Acceleration Lab) Systems expected to be subject to support measures (draft) Sub-WG (distributed energy management systems) Management of power transmission, transformation, and distribution BEMS, FEMS, HEMS Demand Response systems, etc. Sub-WG (security and safety) Facial recognition systems Comprehensive Security systems Sensor technologies, etc. Sub-WG (utilization of a quasi-zenith satellites) Highly accurate position information (e.g., for agriculture), etc. Sub-WG Develop a framework in which Japan will prioritize support for businesses engaging in the fields with significant need or those that represent Japan s strengths. Support businesses in exporting systems through technical expert organizations Technical expert organizations (distribution energy management systems) Technical expert organizations (security and safety) Technical expert organizations (utilization of quasizenith satellites) Support items provided by the government (draft) F/S Human resource development Subsidies 32

34 (4) Measures for the Enhancement of the International Standardization Strategy As for global markets, companies cannot expand their market scale solely based on the quality of their products, infrastructures or services. They must utilize international standards as tools for entering and gaining traction in global markets. In the fields where ICT and other technologies are advancing quickly, major companies in the U.S. markets have been leading consortium standards. There is no first-mover advantage unless Japanese companies join those consortiums in the earliest stages. Additionally, many safety and other technological standards are established through a one-nation one-vote system of de jure standards of international standardization organizations, such as ISO and IEC, which creates an advantage for European countries. In either case, it is indispensable for Japan to cooperate with the U.S., European countries, and Asian countries through the international standardization process. To this end, Japan needs to improve related strategies by uniting efforts of the public and private sectors and it also needs to enhance the quality and quantity of human resources who can play future leading roles in international standardization. European countries have an advantage thanks to a one-nation one-vote system of de jure standards (e.g., ISO and IEC). China collaborates with Germany and other countries. Japan collaborates with the U.S., European countries, and Asian countries, depending on field. In the U.S., companies, associations and consortium are leading advanced fields. Out of 60 countries as full members of IEC, 23 are European countries. Representative of Japan Representat ive of the UK Representati ve of Germany Representati ve of France JISC Japanese companies Domestic standardization 国家標準化機関 organizations Global companies Enhancing the development of human resources responsible for international standardization (Enhancing measures for: expansion of the bases through training systems, seminars in universities, etc., fostering of professional human resources in collaboration with international organizations (e.g., IEC), and establishing cross-generation networks) Note: There are many companies in the same industries in Japan, while the industrial realignment has already been completed in Europe. 33

35 Ver. 2 Ver. 1 (5) Revision of the Contract Guidelines on Data Utilization Rights Flow of processes for concluding a contract Contract for data provision Determination of data utilization rights Contract for data utilization rights Contract for data provision Contract for data utilization rights Contract for joint development Contract for commission of development to a third party Contract for data utilization rights OSS Contract for joint development Contracts for trading Leasing Data Dataset Learning Learned model Hardware Use / product material Data provider Data-set composer AI business AI business Manufacturer (seller) User Data utilization rights Relationships of responsibilities in terms of AI Relationships of rights in terms of AI The Guidelines for Concluding Agreements on Authorization for Data Utilization Ver. 1.0 were formulated and released in May 2017, aiming to encourage companies to conclude a contract for utilization rights of industrial data across sectors. None None Data utilization rights (items to be concretely discussed) [Points of contention] Overall revision (review of elements to be considered, etc.) Enhancement of use cases in individual fields Dissemination and promotion (descriptions or booklets in simple words, etc.) Development of specific case examples and support measures, etc. * Discuss concretely by industrial field, e.g., the automobile, industrial machinery and distribution sectors. Relationships of responsibilities (additional) [Points of contention] Streamlining of application relationships of the existing laws Approaches to avoiding the situation where a cause of an accident cannot be cleared and those to the locus of responsibility for the cause determined; making rules for responsibility sharing; and means for securing evidences Effectiveness of terms for indemnity or limitation of liability, etc. [Case example] Maloperation of AI caused manufacturing of defective products or product accidents. Relationships of rights (additional) [Points of contention] Situation where steps of AI development and utilization are protected by intellectual property rights or contract agreements Relationships of rights in terms of learned model Appropriate and fair handling of intellectual property rights based on contract agreements, etc. [Case example] Relationships of rights in terms of a learned model that a company has developed or created based on operation data provided by a manufacturer METI will hold meetings for discussing the guidelines and revise them by March in FY

36 (6) Enhancement of Development of Hybrid Human Resources with Expertise in Both Virtual and Physical Worlds, AI and Other Fields In recent years, Japan is facing serious labor shortages. To address this situation, it is urgently necessary to develop outstanding human resources, for e.g., those with expertise in both virtual and physical worlds in terms of IoT, and those who utilize AI, big data or other advanced technologies in industrial fields that have factory floors in the physical world. METI will strive to discover needs of industries for human resources through efforts under the Connected Industries" policy concept, and will also enhance efforts, in collaboration with MEXT and other ministries, for supporting companies in building capacity or acquiring skills mainly focusing on the fields of IT and data or in developing programs for fostering human resources with expertise in AI. Virtual world Discovering needs of industries for human resource development Manufacturing/ Robotics x IoT (data analysis), Automated driving x AI development, bioinformatics, material development x AI, etc. Advanced IT Human Resources (in the era of the Third Industrial Revolution) Those with expertise in IT with little knowledge of work on the factory floors Core Human Resources with expertise in IoT (professionals playing a leading role on factory floors) Advanced IoT Human Resources Those with expertise in both the virtual and physical worlds in terms of IoT This field will face serious labor shortages, in particular, of human resources indispensable for companies to address AI, big data and other advanced technologies in the era of the Fourth Industrial Revolution. Advanced Manufacturing Human Resources Those with outstanding skills in manufacturing fields in the physical world with little knowledge of IT Physical world 35

37 Collaboration Collaboration (7) Further Deployment of Efforts for Regional Companies and SMEs In collaboration with the Japan Chamber of Commerce and Industry, IVI, the Robot Revolution Initiative of Japan (RRI), private associations, Yorozu Support Centers, Local IoT Acceleration Labs, and other entities, METI has been undertaking efforts for sharing training curricula and other efforts with regional companies and SMEs across industries and throughout Japan. METI will aim to develop bases that support SMEs in the manufacturing industries in addressing the fourth industrial revolution. Private associations, etc. Supporting companies in developing experts or by dispatching experts Collecting requests from businesses and introducing companies that accept interns Collaboration with the IoT Utilization Expert Committee Utilization of management advisers (about 3,400 advisers) Supporting Teams for Smart Monodzukuri Fostering leaders (utilization of retired employees) SMEs Kaizen activities in the manufacturing industries Supporting companies in introducing IoT or robots * Target number of bases: 40 in next two years Yorozu Support Center One-stop consulting counter Providing management consulting services, as well as staffing IT, designs, IP and other experts *40 counters have opened across Japan. Sharing knowledge cultivated at IVI regional seminars RRI provides information on support tools for smart monodzukuri, etc. B A N K Regional banks (about 170,000 employees), shinkin banks (about 110,000 employees), etc. Improvement of productivity and value added Ascertaining overall operation situation of factories and warehouses Finding signs of equipment failure and addressing them Overcoming labor shortages Promotion of technical skills training for the next generation, etc. Dispatching mentors who contribute to achieving and developing regional projects or companies efforts, etc. 36

38 [Reference] Achieving Goals Set in the Connected Industries Policy Concept Advantages for Regional Companies and SMEs Introduction of IoT, robots and other advanced technologies will help companies improve their productivity, reduce repetitive or physically demanding work, and cut labor costs. Combining the policy with teleworking will create comfortable workplaces for young people, women and elderly people. Overcoming labor shortages, working style reforms Artificial intelligence and other technologies will contribute to making experts knowledge more transferable, and this supports young employees in acquiring skills. Passing down techniques Converting craftspersons techniques and creativity into data and utilizing the data at production facilities will contribute to small-lot-highvariability production runs or single items with quick delivery leading to acquisition of new customers. Expansion of profits The elderly people in underpopulated areas will be able to move independently, while businesses will be able to deliver parcels even to remote areas. The elderly will be able to utilize cars safely regardless of their age. In the future, automated driving technology will help people who cannot drive to travel to their destinations. Solutions to societal problems (safe driving and transportation) Case example 1: Asahi Tekko Co., Ltd. Hekinan City, Aichi Pref.; manufacturer of automobile parts with 480 employees The company developed a sensor monitoring system that contributes to accelerating Kaizen activities and utilized the system for their production facilities, exposing problems in their parts manufacturing processes, improving productivity quickly, and decreasing labor costs dramatically. The company also digitalized simple work to the maximum extent possible and encouraged employees to do work that can only be done by human beings, e.g., Kaizen activities, thereby achieving a working style reform. Monitoring system developed by the company Case example 2: Demonstration projects ongoing across Japan Automated driving: Eiheiji Town, Fukui Pref.; Wajima City, Ishikawa Pref. (upper-right photo); Chatan Town, Okinawa Pref.; and Hitachi City, Ibaraki Pref. (lower-right photo) Drone parcel delivery at Hamadori Area, Fukushima Pref. (left photo) Requiring no power cables or LAN installation thanks to the wireless technology with a low-powerconsumption setting Minimized initial investment by making the system accessible by general-purpose smartphones and other devices 37

39 Future Directions along which the Round Table Conference of Startups on Connected Industries Advance Startups are dynamos to discover dormant resources in large companies, universities and other organizations and to develop the resources into value and wealth. Startups, a source of creating value added by connecting management resources of funds, human resources and technologies, are indispensable for Japan in implementing the Connected Industries policy concept. METI will aim to establish an ecosystem in which these startups are able to cultivate a metabolism and compete with global companies. Background and problem awareness Future policy directions Japan will set appropriate policy indicators (KPI), while undertaking measures for connecting money, human resources and innovation technologies. Startups winning markets overseas (unicorn startups, etc.) Creation as a key to growth and new quality employment creation More intense competition for ecosystems that produce global startups in overseas countries Global unicorn money (risk money supply) Global unicorn talent (human resource supply) Japan is nearly completing support measures and has held discussions. It will need to connect related measures and exploit all available policy resources to solve challenges. In particular, it is important to utilize dormant resources in large companies, universities, and other organizations. Global unicorn tech (innovation technology supply) 38

40 Challenges Further Discussed In addition to the five priority fields and the cross-sectoral policies, some points of contention can be considered as challenges to be discussed as below that could be major future pillars of the policy concept. 1. Back office reform It may be important for Japan to develop a foundation on which companies are able to improve productivity and create new services as a result of collaborative use of data across borders between management and factory floors or data across priority industrial fields. To improve productivity of factory floors, it may be important to accelerate the back office reform as cooperation areas. Financi al affairs Accounting Distribution Customers Procurement Crosssectoral data collaboration Invento ry Sales Operati ng activitie s 2. Popularization of fintech in a variety of industries As fintech contributes to connecting data containing financial information existing across supply chains, further acceleration of inter-company collaboration in the field of settlement may be needed. It may be necessary to bring about innovations in which solving users problems and providing new value through the utilization of big data analysis and AI can be accomplished with a far smaller cost compared to the past cost. 39