〉〉Topics

The Initiatives of the Digital Innovation Centerto Promote the Digital Transformation
Takehiko Nomura*, Tomofumi Kise*
In order to develop the digital technology as a “fundamental technology”, weestablished the Digital Innovation Center in April 2020 and have been promoting
the Mono-zukuri (manufacturing) Digital Transformation (DX), Koto-zukuri (value creation) DX andthe digital education within the company.
The main initiatives of the Mono-zukuri DX are the automatic production by Artificial Intelligence(AI) and the improvement of the inspection efficiency by AI image inspection. The problems
faced at the factory are common to those of the activities of our customers and we are working
to develop the solutions for the Mono-zukuri DX that can also be applied to our customers’
Koto-zukuri activities. We are also working on new DX businesses, including the promotion ofDX in the primary industries.
To strengthen the foundation for promoting the DX within the company, we are implementing
company-wide E-learning, DX courses for managers, and other digital education tailored to thetype and level of human resources.

ABSTRACTINTRODUCTION
1.1. INTRODUCTION
Throughout our long history, Furukawa Electric have been
supporting Japan’s modernization with copper and electric wires and have been contributing in the infrastructuresuch as in electricity, telecommunications, and railways.
With the material capability of the core activities that wehave cultivated over the centuries, we have been working
incessantly on technological innovation. Aiming to realize
the Furukawa Electric Group Vision 2030, we are working
to realize a prosperous and sustainable society and create the businesses of social problem solving, by utilizing
the four core technologies of metals, polymers, photonics, and high frequency.
With the adaptation to the new normal, such as avoiding the “3 Cs” (Closed spaces, Crowded places andCross-contact settings), cyberization has made great
progress. Essential workers support a comfortableremote life, including telework, which is further supportedby the digital technology. As a manufacturer, it is an
important point of view to connect the factories throughtelework and factories and make them remote,unmanned, and automated. In order to achieve this, it iscalled a digital twin, but it is necessary to have a solid
database of data on people, equipment, and products inthe manufacturing so that inspection and control can be
performed tightly based on inter-processes.
In addition, the digital technology has an impact of not
only on the reform of Mono-zukuri, but also on the cre*

Digital Innovation Center, Strategy Division

ation of new values and Koto-zukuri. The DX has been
attracting a widespread attention as a concept that also
can leads to the reform of business processes and organizational culture. With the growing momentum to accelerate the digitization of the Mono-zukuri and the Kotozukuri, the Digital Innovation Center was established tolead to the creation of businesses in new areas. Although
it belongs to the R&D Division, not only the members ofthe research laboratories but also the Mono-zukuri
department, Information and Communication Technology(ICT) department, and sales departments participated sothat the organization could be cross-functional within thecompany. This report focuses on the activities of theDigital Innovation Center and describes our approach tothe DX and its initiatives.

THEACTIVITIESACTIVITIESOF
OF THETHE DIGITALDIGITAL INNO2.2. THE
INNOVATIONCENTERVATIONCENTER
2.1

The Activity Concept of the Digital InnovationCenterThe four core technologies, metals, polymers, photonics,
and high frequency are the group of technologies that
directly contribute to the competitive advantage of ourproducts. However, the common technologies that fundamentally support these technologies are also important.
At Furukawa Electric, we have been developing advanced
analytical technology, simulation technology, productiontechnology, reliability technology as the “fundamentaltechnologies”. By firmly insourcing and taking control of
the fundamental technologies, we are able to accumulate
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The Initiatives of the Digital Innovation Center to Promote the Digital Transformation

know-how, ensure confidentiality, customize them tomeet internal needs, and respond agilely to the problemsof business and research divisions. Figure 1 shows therelationship among business areas, core technologies,
and fundamental technologies.

Electronics
Infrastructurecomponent Core technologies
MetalsHigh
Polymers
frequency
Functional
Photonics
products

Digital Innovation Center➡Supporting AI/IoT
company-wide “Digital enabler"

Fundamentaltechnology＝Inner muscle

AI/IoT

Simulation

Reliability
Advancedanalytical technology

Productiontechnology(Not limited to AI/IoT)“Insourcing" of the fundamental technology
・Agile correspondence
・Accumulation of know-how, ensuring conﬁdentiality
・Customization according to the needs

Figure 1 The relationship among business areas, coretechnologies, and fundamental technologies.

Among them, the reliability-related technologies havebeen based on the statistical analysis, but in the mid2010s, driven by the rapid progress of digital technologies, they have been approaching areas such as the data
science and the deep learning. Also, at the same time,the data collection by the Internet of Things (IoT) and theautomation of image inspection have become important

issues in production technology and the energetic activities have been carried out. In April 2020, the Digital
Innovation Center, a cross-functional organization, wasestablished in order to unite these activities and develop
the digital technologies such as AI and IoT as the “fundamental technologies”. We are working on the development of a software platform that targets both productivity
improvement and skill transfer using the digital technology, and Koto-zukuri and the business creation making fulluse of AI. We are calling to everyone in the center andwithin the company, “Let's firmly develop the inner muscle that supports the core technology and business divisions.”, “Let's become a digital enabler that makes thingspossible”
2.2 The Initiatives of the Digital Innovation Centerfor the Mono-zukuri DX
Figure 2 shows a bird’s-eye view of the activities of theDigital Innovation Center. The horizontal axis represents“exploitation of the technology” and the vertical axis represents “exploration by digital twin”. In the technical axis,
data can be acquired and visualized by IoT, factor analysis and prediction can be performed, and eventually automatic control and prevention can be realized. Exploration
activities are divided into the “Mono-zukuri DX: Process
Innovation”, the “Koto-zukuri DX: Work Innovation”, andthe “Koto-zukuri DX: New DX Business”.
One of the main initiatives is the digitization of theMono-zukuri: process innovation. The shift to cyberspace
is progressing cross-functionally across the company’sbusiness divisions and the automatic manufacturing byAI, the improvement of inspection efficiency by AI image,etc. are being carried out. AI-assisted visual inspection
has high expectations within the company and we areworking on many projects. Some of the projects havealready been introduced and operated in the mass production factories. In addition, as an advancement in theproduct design and the material design, we are also

Exploration by digital twin
Value
innovation

Businessinnovation

Process
innovation

Physical condition
prediction

Alert issuance

Koto-zukuri DX
New DX business

Remote support
Visual inspection

Promotion ofoverall equipmenteﬀectivenessKnowledge
Data Base (DB)Natural language processing
Many projects

Visualization
Data acquisition (IOT)

SafetyPrevention
Technologytransfer

Koto-zukuri DX

Service, Data utilizationOptimal value proposal
Material
designFactor analysis

Mono-zukuri DX

Improvement ofMono-zukuri eﬃciency

Automatic control
Prediction / Prevention

Exploitation oftechnology

Utilization of simulation

Figure 2 The bird’s eye view of the Digital Innovation Center activities.

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The Initiatives of the Digital Innovation Center to Promote the Digital Transformation

working on AI-based material informatics to accelerate
the development of new materials for the advancement of
product design and material design.
Figure 3 shows an example of the AI image inspection
system. One of the challenges in operating the AI system
in an overseas factory is the remote operation and thecontrol from the mother factory in Japan, and updating
the AI model. In this system, if the AI makes a wrong
judgment in the image inspection, the corrected training
data is sent to the cloud and the cloud updates AI model.
The cloud side sends an approval email stating the accuracy of the judgment, and when the production engineer
approves the e-mail, the new model is automatically
updated to the on-site machine. Through this process,the control from the mother factories in Japan will
become easy. As a side note, this system was jointly
Clouddeveloped with Aidemy Inc., a venture company from theTokyo University.
The process data analysis, the factor analysis, etc.
have been cultivated through the reliability technology,
but recently, approaches using machine learning havebeen increasing as shown in Figure 4. In this example, amachine learning model that predicts the characteristics
from the process data is constructed, but it is not limited
to predicting characteristics; it can also propose conditions for achieving target values, contributing to the manufacturing of products with targeted characteristics. Thistechnology can also be used to visualize and transfer on
the “Takumi no waza (master craftsmanship)”.
2.3 The DX for Solving Social Problems
In this way, we are enhancing our technological capabilities in the area of the process innovation, which is highly

AI model updateon the cloud
Send modiﬁed
training data to the cloud

Dog

Send an approval email
describing the judgment system【Image after improvement】
・Use the cloud.
➡Easy to manage fromdomestic mother factories

DogAppleAI
misjudgment

AI image inspection【Until now】
・Operational issues
at overseas factories・Remote control
・AI model update

When approved ...

Automatic updateof new model toan on-site machine【Future tasks】
・Application to mass
production factories
・Extracting issues inactual operations

Co-developed with Aidemy Inc.,a venture from the University of Tokyo

Figure 3 The cloud-based AI image inspection system.

【Image after improvement】
・Quick feedback can be given when the state of
the manufacturing equipment changes
・The “craftsmanship” will be visualized and can be transferred
・Products can be produced with the targeted Characteristics【Until now】
・It takes time to improve
・Worker adjusts with “craftsmanship”
・The characteristics of the productmanufactured will vary

Develop a model that predicts characteristics from process data andcreate products with the desired characteristics

Process A
Process data

Predictive model
accuracy Improvement

・・・
・・・
・・・・・・

Predictive explanation

Improvement

AI

Under the current
process conditions,the predicted value is XX.

Intermediate
inspection

***
***
***

AI

Process condition
Proposal

To reach the target value,
set the ++ amount to yy.

Finalinspection【Future tasks】
・Expand to larger varieties【Current status】 ・Update predictive modelsappropriately
It takes 2-3 days
to improve.

Figure 4 The characteristic prediction and the feedback system using machine learning.

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The Initiatives of the Digital Innovation Center to Promote the Digital Transformation

sought after within the company, but the problems that
we face at the factory are based on social issues, which
are also shared by our customers. In other words, we see
our experience in the Mono-zukuri DX as a seed for theKoto-zukuri DX, and we aim to promote the DX in an“ambidextrous” manner, exploitation and exploration. For
example, in the situation of corona crisis, the remote
operation and the remote start-up of overseas factories
have become major issues in the Mono-zukuri DX. In
addition to the cloud-based image inspection systemdescribed above, we are working on solving the Monozukuri jobs, including the use of VR (Virtual Reality) / AR(Augmented Reality) devices, but if applied also to theassistance of the maintenance and the inspection at thecustomer’s site, it will develop into not only Mono-zukuri
DX but also Koto-zukuri. We are working on with a consciousness of expanding the platform cultivated within
the company to the customers’ Koto-zukuri.
As for new DX business in the enclaves, we are also

working on the detection of wild animals and the promotion of DX in the primary industries. The scope of digitalapplication is wide and we will be working on full-fledged
company-wide deployment in the future. Figure 5 shows
an example of a project that we are currently working on,
This is the example of research and development to predict the poor physical conditions by using AI while collecting and monitoring data on position, behavior,appearance, and body temperature of cows for the purpose of early detection of poor physical condition ofnursing cows in group captivity, As a side note, thisresearch is supported by the “Innovation Creation
Enhancement Research Promotion Project” of the BioOriented Technology Research Advancement Center,
which is a part of the National Agriculture and Food
Research Organization.
Figure 6 shows a bird’s-eye view of the Mono-zukuri DX
and the Koto-zukuri DX from a different perspective thanFigure 2. The Mono-zukuri DX focuses on digital improve-Extracting technologies used to solve social issuesPromoting DX in the primary industry■Realizing smart agriculture by utilizing image analysis
technology and AI■Agricultural Research Organization’s project isdeveloping a technology for simultaneous monitoringof all nursing cows through industry-academia co-creation■Opened an industry creation course with Hokkaido UniversityBodyPosition

Monitoring oftemperature
health condition

ActionAppearance【Until now】
・Group breeding of nursing cows
・Delayed discovery of poor physical condition【Image after improvement】
・Position, action, and appearance of nursing cows
・Whole head monitoring of body temperature
・Early detection of poor physical condition【Future tasks】
・Verification in the actual field
・Decisions based on complex data
・Establishing of the business model

Figure 5 The DX in the primary industries using AI.

Mono-zukuri DX

Focus on“digital improvement”
Electronics
Infrastructurecomponent Core technologies
MetalsAdded value /Proﬁt margin

High
Polymers
frequency
Functional
Photonics
Component

New Mono-zukuri

AI material design, Mono + data utilization

Product planning/

Material development

Assembly / processing
Distribution / sales

Service and maintenance・Close contact with the ﬁnal user

・Create a base of value

UpstreamNew Koto-zukuri

Existing business areas + service and maintenanceDigital new businessBusiness process

Downstream(customer)

Figure 6 The value chain and the Mono-zukuri, Koto-zukuri DX.

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The Initiatives of the Digital Innovation Center to Promote the Digital Transformation

ments in the factory to improve quality, productivity,maintainability, etc., and contribute to raising profit margins. On the other hand, even in the same Mono-zukuri
DX, the planning of new products and the development ofnew materials using AI functions can be seen as a moveinto the upstream side of the value chain. Furthermore, byadvancing into service and maintenance using the digitaltechnology, the company is moving into the downstreamside of the value chain. In this way, we will go beyond the“smile curve” phenomenon, in which the profit margins of
the upstream and the downstream are high, and promote
activities to control the entire value chain.
2.4 Developing and Strengthening the Digital
Human Resources Within the Company
As a part of our efforts to strengthen our digital humanresources, we are strengthening our recruitment of new
recruits and career recruits. In the area of recruiting new
employees, we are strengthening our efforts to reach out
to information-related departments that we have had little
contact with in the past, such as by participating in social
collaboration courses at the Tokyo Institute ofTechnology's School of Information Science andEngineering. In the area of career recruitment, we areactively promoting our DX activities to the outside company.
On the other hand, digital human resources are short
supply throughout the industry, and there is a limit tostrengthening by appointing external human resources.
Therefore, it is essential to strengthen the internal development of digital human resources. Since 2018, we havebeen using E-learning from Aidemy Inc. in the R&D
Division. In addition to the ease of use of E-learning andthe technology that covers system development, thevision of Aidemy Inc. (Economic implementation of AI,
support for insourcing production within the company)
and the activity concept of the Digital Innovation Center

resonated, leading to the capital and business alliance inJune 2021.
As digital human resources, we divide them into concept planners (planners, designers) and creators (software engineers, AI engineers). Concept planners are thepromoters who plan to improve the structure of a seriesof business processes. They identify business problems,
determine whether the digital technology is effective insolving them, and develop improvement plans. Creators
design and create the details under the concept planners.
In addition, a small-scale problem-solving exercise isconducted, in which similar improvements have been
made in the past. It is the role of embodying, designing,realizing, and utilizing improvement plans according to
the work in the field to produce effects. Using AI as anexample, Figure 7 illustrates the steps of digital application and the image of the corresponding human resources. The Digital Innovation Center is the main body forbuilding IoT and AI models within the company, but it also
works with business divisions to identify issues and operate models. The planner must have domain knowledge ofeach business, and it is desirable to arm the aces of business units with digital skills.
As detailed DX education according to the type andlevel of human resources, we hold DX courses for managers, company-wide deployment of E-learning, andexchange meetings within the company. The basic curriculum for the DX course for managers consists of threemonth Aidemy online learning content and total of two
remote lectures, with an optional workshop for identifying
actual issues and creating plans.

Guideline
AI utilization steps

AI human resources

Approach

Guideline

Identifying
AI issues

Building
IoT

Creating
an AI model

Operationof AI model

AI planner

Software Engineer

AI engineer

Software Engineer

AIAI

Business Division / Sales
Digital Innovation CenterAIAI

Digital Innovation CenterConstruction within the company

On-premises
Cloud, remote monitoring

Use open sourceDevelopment ofAI human resources

・Online learning program
R&D Division(Capital tie-up with Aidemy Inc.)
Mono-zukuri Reform Division
・AI technology exchange meeting
Business Infrastructure Reform Division
within the company
Business division
・DX series new theme contest

Figure 7 The steps in the use of AI and the corresponding digital human resources.

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The Initiatives of the Digital Innovation Center to Promote the Digital Transformation

ISSUES/ /HURDLESHURDLES AND
AND DIRECTIONS
3.3. ISSUESDIRECTIONSFORSOLVINGSOLVINGFORSince the establishment of the Digital Innovation Center,some results have been achieved, mainly in the area ofthe Mono-zukuri DX, but full-scale company-wide deployment is yet to be achieved. In promoting the DX, we mustalso gain understanding of cost effectiveness and theplacement and training of human resources. In particular,
increasing the number of promoters in the department
side and solving the shortage of software human resources are major hurdles. In order to overcome this hurdle, itis necessary to have a system in place to pick up measures that make good sense and place emphasis on
human resources. We are currently strengthening thetraining of human resources who will play the role of promoters by using E-learning but in the future, we will create a roadmap for human resource development that
includes criteria for each level and the number of people
at each level to ensure the company-wide deployment.

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