CHAPTER

CDXO MESSAGE
In response to the changesof the times, we will further
promote our DX strategy
and its growth.
Hidetomo Hashimoto
Senior Managing Executive Officer, CDXO,
Executive General Manager of Digital Innovation Partners

Outline of the Benesse Group’s
DX strategy
In 2021, the Benesse Group launched Digital Innovation
Partners (DIP) as a virtual organization to plan andimplement the Group’s DX strategy. In 2022, DIP became
an actual Group-wide organization that has digital,
IT, human resources, and DX promotion consulting
departments within it. As such, DIP has been leading theGroup’s DX strategy, from making plans and allocating
resources and funds to implementing specific measuresacross the businesses and companies of the Group.
In July 2023, Benesse Corporation merged Benesse
InfoShell Co., Ltd., and integrated the supply chain
management function of this IT company, which wasengaged in the development, maintenance and operationof systems and the implementation of security measures
for the entire Benesse Group. As a result, DIP became anorganization with more than 800 staff members.
Based on the business plans made by each of thein-house companies, the staffs of the business departments
and DIP have been collaborating as a joint project team tosteadily promote the DX of Benesse’s products and services.
On my part, I frequently visit Group sites to talk withkey persons on pushing ahead with innovation onsite.
Moreover, I check the progress of a range of related projects
on a weekly basis to propel the implementation of theDX strategy, while focusing on promoting the sharing ofspecific successful examples across the Group.
Under the leadership of DIP, we will continue to further
promote the entire Group’s DX.

31Benesse Report 2023

Recent results achieved through theDX strategy
In fiscal 2022, as in fiscal 2021, the Benesse Group was highly
rated for its DX initiatives by multiple external organizations. For
example, at the 19th Japan e-Learning Awards held in 2022, wereceived the grand prize for MARUG land, which is an ICT-basedteaching app that provides children with learning experiencesin reading and writing that are tailored to their individual
developmental characteristics. Also, at the 40th Information
Technology Awards, we received prizes such as one for DIP inrecognition of its consistent promotion of DX projects acrossthe Group, and another for the development of Majikami AI.
Further, in fiscal 2022, coverage of our DX initiatives bymass media such as newspapers, magazines, TV broadcastingstations and online media in their DX-related articles/programs
increased by as much as 266% year on year. Also, we weremore frequently asked to give training and speeches on our DX
strategy and specific DX promotion cases. I therefore feel that
we have substantially increased our public profile as a company
advanced in DX. Partially thanks to these achievements, we alsoincreased the number of applicants to our DX-related job offers
targeting experienced workers by 150%, whereas companies
are generally facing difficulties in securing personnel for DX.
We also established the Digital Innovation Fund (DIF) in
November 2021 to promote DX for our existing businesses
and services and to promote the co-creation of newbusinesses. The number of companies in which we invest
through this fund increased by six over the past one year andtotaled nine as of July 2023. Since the establishment of theDIF, we have been proactively broadening our network with01 Our Vision and Business Strategies▶DIP organizational structure

DX Strategy Office

Formulates and promotes Group-wide DX strategy

DX Human Resources Development Department

Recruits and cultivates DX human resources and updates human resourcesystems

DX Consulting Department

Advances and promotes participation in digital shift projects and formulates
disruption countermeasures

Data Solutions Department

Promotes data usage at each in-house company

Digital Marketing Department

Promotes digital marketing at each in-house company

IT Governance Department

Formulates and promotes IT strategy, and improves the quality, cost anddelivery standards for IT-related development, costs and personnel

Infrastructure Solutions Department

Gives technical support for the establishment and operation of IT
infrastructure and DX promotion

Corporate System Solutions Department

Develops and operates Group-wide systems and the administrative
departments’ systems

Out-of-School Learning Business Company’s
System Solutions Headquarters

Develops and operates systems for the Out-of-School Learning
Business Company

School and Teacher Support Business Company’s
System Solutions Headquarters

Develops and operates systems for the School and Teacher
Support Business Company

Nursing Care and Childcare System Solutions
Department

Develops and operates systems for the Nursing Care and Childcare
Business Company

Kodomo Challenge System Solutions Department

Develops and operates systems for the Kodomo Challengebusiness

SCM Department

Designs, builds and operates the procurement, production and logistics
infrastructures to support business operations

Benesse BASE COM Co., Ltd.

Builds, operates and improves systems for sales management, logistics
management and student assessment for Benesse’s school business

Benesse Hong Kong Co., Ltd.

Improves the quality, cost, delivery and safety standards in the development
and procurement of educational toys

venture companies, thereby making the Benesse Group
more open to approach by a wider range of parties. Goingforward, we will shift our focus to the improvement of skills
for DX promotion and the generation of synergies for thecreation of new businesses. Powerful venture companies
can provide us with great value through their technologies
and growth potential, and the Benesse Group will be able

to offer even greater value to society by achieving growth
together with such venture companies. We have alreadysuccessfully launched some collaborative projects thatutilize advanced technology of investee companies. We willcontinue to offer the Benesse Group’s long-accumulated
expertise and know-how to the greatest extent possible tothese partner companies to achieve mutual growth.

▶Partners that have received investment and support through the DIF
Code Chrysalis Japan Co., Ltd.

Hmcomm Inc.

Fourth Valley Concierge
CorporationPaiza, Inc.

Arsaga Partners, Inc.

LearningBOX, Inc.

LX DESIGN Inc.

beBit, Inc.

Natee Co., Ltd.

Benesse Report 2023

32

CDXO MESSAGE

CHAPTER

Making more effective use ofgenerative AI

can therefore use the service safely with peace of mind.
The chat service is facilitating verification and planning for
the use of generative AI by each business department andhas led to the launch of many projects. For example, inJune 2023, the Next-Generation Contact Center Project waslaunched, which was followed by the provision of the Jiyu
Kenkyu Otasuke AI service in July to assist elementary school
students with independent research in the Shinkenzemi
business. Further, we launched the Next-Generation Website
Project as well.
When starting a project of unprecedented innovation,some might think it is necessary to clarify the purpose of
the project first. However, for DX, it is also important to try astring of emerging technologies first, and then think about
their specific usage. I think we need to use the technologies
ourselves to truly understand the opportunities and risks
they might bring about. Although we have improved ourinternal environment so that employees can use such newtechnologies proactively over the recent year or two, I would
also like to build a corporate culture that allows Group
employees to use such technologies even more freely andproactively.
For the corporate transformation and cost structurereform as described in the Transformation Business Plan,
I am convinced that the effective use of generative AI willhelp us generate innovation. As an organization to facilitate
this, we established the Operation Transformation Officewithin Benesse Corporation in June 2023.
In the face of the decreasing birthrate and further
diversification of society, the Company needs to transform
its conventional business models, change its way of
doing business, and increase its productivity, thereby
further evolving its business. By promoting automationand mechanization, we will be able to provide customers
with necessary information and solutions in an even more
timely manner and can also reduce the time required for
employees to do their jobs and shift their focus onto morecreative operations. I also think that promoting DX not only

The technological innovation of generative AI has been
attracting much attention, and the Benesse Group thinksthat such innovation could pose serious threats, butalso bring about great opportunities to its businesses.
Accordingly, we are working to promptly acquire external
knowledge and the development of new partners toincorporate new generative AI technologies into theGroup. We also hold discussions on generative AI regularly
between the management team and staff of DIP.
One specific measure involves starting the operation ofthe AI-based Benesse Chat service for Group employees inApril 2023. It took only two weeks for engineers from DIP todevelop this in-house service, which is intended to provide
employees with an environment that helps them to increase
their business productivity and conduct examinations for
new products and services. This chat service is provided ina closed environment to offer high security and ensure thatno information will leak outside the Company. Employees

Initiatives and services based on the use of generative AI
Step 1
Start of internal use (from April)

Step 2

Step 3

Increase the efficiency of internal operations (from June)
Accumulate knowledge while using AI in internal processes

Launch of a service for customers(from July)

Benesse Chat

Next-Generation Contact
Center Project (from June)

Next-Generation Website
Project (from July)

Jiyu Kenkyu Otasuke AI

Provision of the Benesse Chatapp to 15,000 Group employees
and promote its use in a highly
secure environment

Improve customer experienceand operational efficiency byusing generative AI at thecontact center

Launch the Next-GenerationWebsite Project by using
generative AI to drasticallyreform the existing online
operational process, thereby
improving both customer
experience and the productivityof the existing website

Based on internal expertise ingenerative AI, develop a service
using AI that does not give
answers for elementary school
students, and offer it free ofcharge to help children enhancetheir ability to think on theirown

Shinkenzemi

33 Benesse Report 2023

01 Our Vision and Business Strategies

DX strategy and priority measures (FY2023-2025)
Promotion of DX in amanner that matches
each business phase
14

Digital shiftproject

DX Strategy
Accelerate the Benesse
G r o u p’s b u s i n e s stransformation bypromoting the DX ofeach business andimproving eachorganization’s DXability

Improvement of organizational DX ability

2

6Effective useof data
3Enhancement

5

Optimization of
the architecture
7

Renewal of
infrastructure
Security measures

IT strategy andgovernance
8

Disruption watch(DIF)

Developmentof DX humanresources

Enhancement

DX ofadministrative
functions

9New

Renewal ofvalue chain

helps us to make effective use of AI but also to enhance
the services that only human beings can offer, in which
Benesse’s strength lies.

this fact gives us a great advantage in the recruitment andretention of DX human resources, for which there is intensecompetition among companies.

Development of human resources
for DX

Policies for DX strategy in fiscal 2023

As for the development of DX human resources, we first
defined the skills required for different job types andintroduced a process to optimize the assignment anddevelopment of personnel. Specifically, we identified theseven job types that are essential for the Group’s DX andhave visualized the level of skills required for each of thetypes in the form of a skill map. We have also identified
DX-related jobs for which we will face labor shortages
in consideration of our future business plans, and arepromoting the reskilling of existing employees for the jobs.
We will give priority to such reskilling even if it takes a longtime, and will employ experts from the outside only if westill have a shortage of personnel for the jobs after making
the reskilling efforts.
In fiscal 2022, the number of employees attending
the DX training program reached 6,504, up 180% year onyear. We created about 60% of the content of the programinternally, and employees themselves serve as lecturers forthe program to share their own related experiences withtrainees. In general DX knowledge, we are making effective
use of Udemy as a self-learning tool for employees. We
also plan to provide the know-how to develop DX humanresources at other companies through the Udemy business.
The Benesse Group is engaging in a wide range ofbusinesses and can thus provide DX personnel with lots ofgrowth opportunities. The Group offers services to infants,
students, working adults, and senior citizens and has abroad range of business models. We can therefore provide
DX personnel with an environment where they can honetheir business skills from various aspects and create a rangeof business value based on their accumulated skills. Indeed,In fiscal 2023, we will focus on the development of humanresources through reskilling, the implementation of priority
measures set for fiscal 2023, and on the enhancement of
our organizational strength for DX. The Benesse Group isconducting businesses that are deeply related to social
issues. Amid dramatic changes in society, we need totransform ourselves as a precondition to make our business
transformation strategy more persuasive: no strategy,
even if it is a good one, will be widely accepted unless it
is supported by evidence. I therefore think it is critical toshow how our DX promotion measures are linked to thebetterment of our business performance.
We have no goals for DX. In response to changes in
the world, we need to make use of new technologies tochange our businesses and services to continue providing
customers with new value, and I regard it my role as CDXOto pursue the methodology to respond to environmental
changes and transform our organization into one that cancontinue to grow.
The Benesse Group has expanded its business scopegradually from the education business. As the corporate size
increases, I am afraid that its ability to respond to changes insociety is diminishing. In this unpredictable age of VUCA, weneed adequate ability to respond to changes in society asa prerequisite for sustainable growth. If we can recover thatability once again, we will be able to increase our service
quality even more in the future. By launching DIP andputting DIF on track, the Group’s business transformation
speed has steadily increased. Going forward, we will further
reform the entire Group’s business foundation and boost thegrowth of its businesses.

Benesse Report 202334