1Chapter

The Link and Motivation Group’s
Value Creation
A History of Creating Value

9Value Creation Process

10Close-Up: What Is Motivation Engineering?

11

9The Link and Motivation Group’s Value Creation

A History of Creating Value

When Link and Motivation was founded, the English word “motivation” was still largely unknown
in Japan. We were a forerunner in recognizing the importance of motivation as we pioneered thisnew era, in which human capital management has at last come to the fore.
Social BackgroundRamping up a fundamental
transformation in humanresources to bolster Japan’snational standing

2012
Start of Abenomics by the Abe administration (1) Aggressive monetary policy(2) Flexible fiscal policy(3) Growth strategy to stimulate private investment

2000

2005

2014
Publication of the Ito Report Calls for improvement in long-term corporate
value through ongoing dialogue and for ROEof 8% or higher

2010

2015

2020
Global COVID-19 pandemic
Publication of Ito Report for
Human Capital Management

A pioneer in developing new
businesses related to organizations
and human resources

Publication of Guidance for Collaborative Value
Creation 2.02023

2010
Entered the individualdevelopment field

2018

First in Asia to obtain ISO 30414
certification

First in Japan to disclose
engagement ratings

Moved to the Prime Market of the Tokyo
Stock Exchange

2016

2007
Stock listed on the Second Section of theTokyo Stock Exchange
Moved to the First Section in 2008

Entered the HR Tech field
Launched Motivation Cloud, Japan’s firstcloud-based service for improving engagement

Main Registered Trademarks in Japan
2002

2003

2017

Entry Managementi-Company

Strategic HR

2019Engagement Score
Engagement Rating
Portable Skill

Chapter 1

Ascent of Link and Motivation

2022
Publication of Ito Report for Human CapitalManagement 2.0

2022

Entered thematching field

Founded as the world’s first
consulting company focusingon motivation

Disclosure of human capital
information becomes mandatory
in securities reports

2020

2012

20002023
Kishida administration steps up
initiatives for “new capitalism”

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2008
Global financial crisis Stock price declines, financial
instability and recessions worldwide

2019
Government-led promotion of work style reform10The Link and Motivation Group’s Value Creation

Value Creation Process

The type of management capital that the Link and Motivation Group emphasizes most is humancapital. Creating value together with stakeholders through a business model that fully utilizes ourcore technology of Motivation Engineering will lead to a more meaningful society.
Changes in the
Operating Environment

Main Types of Management CapitalBusiness Activities

Value Created

Organizational strategies
to maximize human capitalBusiness strategies tomaximize customer value

Creating value together
with our stakeholders

Pages 34-38

Pages 27-33(decrease in the working
population)

Employees(business shift fromproducts to services)

Growing momentum
for human capitalmanagement

Engagement Ratings

Rank of AA or higher

8 out of 8
companies

Motivation
Engineering

IndividualDevelopment
Division

Reproducibility

Rank of A or higher
Managers: 73.1%
All employees: 55.4%

Individual Development Division
Average number of enrollees
during the past 12 months

14,516

Average number of ALTs
dispatched during thepast 12 months

Role Survey Scores

Diversification ofwork motivation

Approx.1,500

Number of companies that
disclose Motivation Cloud
diagnosis results

116

Source of our uniqueness andcompetitive advantages

Practicality

Number of corporate customers

2,866

Matching
Division

Number of OpenWork
registered users

6.05 million

Intellectual capital(cumulative)

Number of corporate customers
for OpenWork Recruiting

2,830

Social capital

Note: As of December 31, 2023Value Creation Platform

Pages 40-45

A MoreMeaningfulSociety
Pages 1-5

Chapter 1

Changes inindustrial structure

Pages 15-25
OrganizationalDevelopment
Division

Human capital

1,470

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Consulting & Cloud Business

Financial capital
Changes indemographics

Our Vision for Society11The Link and Motivation Group’s Value Creation

Close-Up: What Is Motivation Engineering?
Motivation Engineering is the core technology of the Link and Motivation Group. Based on a wide range of academic findings, it underpins all the Group’s businesses.
Since our founding as a consulting company, we have developed Motivation Engineering with a deep commitment to continuously improving the practicality and reproducibility of its
results, enabling us to roll out businesses in other fields such as the BtoC business and matching.
We will continue our collaboration with academic institutions to regularly update this technology and upgrade our products and services.

Regularly Updated and Utilized in Solutions(Businesses in Each Division)

Academic Findings

Social systemtheoryPsychology

Philosophy

Linguistics

Biology

Educationand others

Organizational
Development

Individual
Development

Chapter 1

Behavioral
economics

Applications in Business

Motivation
EngineeringMatching

Reproducibility

Collaboration with Academic Institutions(Motivation Engineering Institute and Edgeson Management Association)

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Businessadministration

Practicality

12The Link and Motivation Group’s Value Creation

Close-Up: The Approach Underlying the Link and Motivation Group’s Business Creation
Motivation Engineering is premised on two basic approaches: a perspective of humans and a perspective of organizations.
The perspective of humans is based mainly on psychology, and views humans as emotional beings with limits to their rationality. The perspective of organizations is based mainly on socialsystems theory and behavioral economics, and views an organization as a cooperative system.
Designing all of our products and services in accordance with this unique approach gives them high levels of practicality and reproducibility.

Humans are not completely driven by economic rationality.
They are emotional beings with limits to their rationality.

An organization is a cooperative system that is
not reducible to its constituent elements.

It is important to design opportunities that offer not only
financial rewards but also emotional rewards.

It is important to reduce complexity by understanding thatproblems are not in the people but in the gaps between them.
Example: Five-person organization

Emotional Rewards

Financial Rewards

Desire for recognition

Money/Position＋e.g., awards forperformance

Desire for growthe.g., improvement inknow-how and technique

Desire for contribution

CB

B

Ae.g., words of thanks

Desire for fellowship

Cooperative systemamong A through E

A+B+C+D+E

DA
EEC

D

e.g., good teamwork

Communication Is the Lifeblood of an Organization

See page 24 for specific examples from the Consulting & Cloud Business.

Chapter 1

Perspective of Organizations

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Perspective of Humans

13

The Link and Motivation Group’s Value Creation

Close-Up: Constituent Technologies of Motivation Engineering—Common Types across Business Fields
Motivation Engineering is driven by diagnostic and transformation technologies. Diagnostic technologies use our unique frameworks to identify customer problems, and the database onorganizations and individuals that we have built up since our founding is one of the largest in Japan. Transformation technologies use our accumulated insights to resolve the problems we
identify, and our ability to provide one-stop support for organizational and individual transformation is a distinctive feature.

Applications across the Link and Motivation Group’s Business Fields
Diagnostic Technologies
Visualization of engagement

Organizational diagnostic data

Transformation Technologies
One-stop support for improving engagement

For
Organizations

11,360 corporate

diagnoses

Visualization of skills and motivation types
Individual diagnostic data

For
Individuals

Training

Systems

Corporate Culture

Strategic design,raising operational
efficiency andimproving recruiting
capabilities

Training by rank (newuniversity graduates,mid-career employees,managers andexecutives) andtraining by theme

Personnel systemdesignGeneral meetings ofemployees andanniversary events

One-stop support from education/examinations and finding
employment to changing jobs720,000 people
Individual diagnosis covers motivation
type and skills as well as learning level topresent the optimal plan for each enrollee.

Examinations

Finding Employment

Changing Jobs

Operation of SS-1, a private
instruction school for elementary
school students, and Motivation
Academia, a cram school forjunior high and high school
students

Placement support for new
university graduates throughcareer advisors

Direct recruiting service
using OpenWork andplacement support
through career advisors

Chapter 1

For organizational diagnosis, we use
Motivation Cloud to identify the locationand nature of issues in each organizationand visualize the state of engagement.

Recruiting

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Approx. 4.03 million
respondents in