DESTINATION OF ONE YAMATODESTINATION OF ONE YAMATO

Part 2

Part 2

Digital Strategy
Value Creation Utilizing New Digital Platform and Digital Data

The Yamato Group has positioned digital strategy as one of the fundamental strategies that support business structural reforms.
Therefore, we are reinforcing the digital organizational capabilities, technological capabilities, quality, and governance of the entire Group.
Based on a new digital platform that understands and communicates various information in real time, we are effectively utilizing data inbusiness activities while expanding the value we provide to customers and accelerating the enhancement of operational efficiency.

 Reform of Development and Operational Structures and Reinforcementof Governance1

 reation of structure that promotes the integration of business and digital departments
C
Revision of development and operational structures, entrusted to system subsidiary, through Group reorganization
 evelopment of human resource cultivation and recruitment measures aimed at further reinforcing development and operational
Dstructures
Includes revision of human resource system, reinforcement of recruitment, and development of technological capability training process eduction of vendor dependence on development projects
RReinforcement of technological regulations through Technology Governance Team einforcing governance of Groupwide digital investments
RPromotion of maintenance and enhancement of development quality and speed, and optimization of development and operationalcosts by closely examining their validity and order of priority of digital investments at Digital Governance Meetings

Digital Investment
Under the medium-term management plan “One YAMATO 2023,”

Meetings, which regulate Groupwide digital investment. Between

we expect to make digital investments of ¥100 billion in thethe fiscal year ended March 31, 2021 and the fiscal year endedthree years spanning the fiscal year ended March 31, 2022, to theMarch 31, 2022, we mostly completed investments in building ayear ending March 31, 2024. During the actual promotion of digi-

new digital platform. From the fiscal year ended March 31, 2023

tal strategy, we carry out the necessary investments after closely

onward, we will prioritize investments that enhance the value we

examining their validity and priority through Digital Governanceprovide to customers and contribute to operational efficiencies.

Trends in Digital Investment AmountResults of Digital InvestmentDigital Investment

2022/32023/3

Enhancement of value provided tocustomers¥8.0 billion¥4.7 billion

Improvement of operational efficiency fortransportation and delivery¥6.2 billion¥5.2 billion

Creation and maintenance of digitalplatform¥11.8 billion¥1.5 billion

Others¥1.8 billion¥0.5 billion

Total¥27.8 billion¥11.9 billion(¥ billion)

20.0–
30.0* 30.0*

27.8

30
25

17.9

20

11.9

15
10

6.0

50

2020/32021/32022/32023/32024/32027/3* Estimated amount as of the start of the fiscal year ending March 31, 2024

Development and Recruitment of Human Resources
Additionally, we have strengthened systems for bringing nec-resources with digital skills and strengthening of technologicalessary development and operation in-house by reinforcing thecapabilities through close cooperation between the Digital

hiring of new graduate recruits and mid-career hires and devel-Department and Business Department to realize sustainable

oping the human resource system and training process.

Under the Yamato Digital Academy (YDA), a digital training program launched in the fiscal year ended March 31, 2022, we spent
the first year engaging in measures such as enhancing fundamental digital literacy and skills. In the fiscal year ended March 31,2023, the second year, in addition to the above, the DigitalInitiatives Aimed at Development of Human Resources
with Digital Skills (Fiscal year ended March 31, 2023)
VisionContent of Training

Attendance
Results

DigitalDepartment

Recognized as a partner bybusiness department leadership and at the core of project
promotion

Training aimed at strengthening skills necessary in work as
digital-specialized personnel,
such as planning, development, operation, andmaintenanceApproximately
220 employees

Business
Department(Head Office)Collaborate with the digitaldepartment, promote businessstructural reforms, and contribute to enhancing profitability

Training aimed at enhancing IT
literacy and digital skills

Approximately
130 employees

BusinessDepartment(RegionalBranches)

Master digital tools to promote further advancement
and efficiency through devices
unique to the front line

Training aimed at reinforcing
digital utilization skills on thefront line

Approximately
200 employees

TargetDepartment and managers in charge of practical work in theBusiness Department (Regional Branch Offices), which deals withcustomers on the front line, promoted gaining skills and knowledge that can be utilized in actual work, increasing the rate of inhouse system development and operation, and enhancing theefficiency of front-line operations and quality of service.

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YAMATO HOLDINGS CO., LTD.
Integrated Report 2023

Total

Enhancement of Last Mile Operation Efficiency
That Utilizes Digital Data

In promoting the structural reform of network operations, we are engaging in measures within the existing TA-Q-BIN network that include appropriate allocation ofYamato resources in line with workload, consolidation and enlargement of sales
offices, and revision of sales driver (SD) workstyles and structure. Area Management
System, a tool developed to support the design of delivery areas and routes for SDs,
who are responsible for last mile, consolidates information on the parcels for pickup
and delivery (such as area, time, person responsible, classification, and volume) andvisualizing it on a map. As a result we have significantly reduced the time needed todesign areas and routes, which previously required analogue data aggregation andstudy and are promoting the enhancement of delivery operation productivity by SDs
based on data.
Additionally, in conjunction with consolidation and enlargement of sales offices,
we will introduce a mechanism (Last-mile Management System) for flexibly adjusting
the delivery area and route in response to fluctuations in daily workload in thesecond half end of the fiscal year ending March 31, 2024. We will further enhance
operational efficiency by integrating this with measures for innovating SD workstyles
and structure, such as allocation of Delivery Drivers (DD, specialized for delivery) in
key urban areas.

2Creation and Development of EC Logistics Network

Under our EC logistics network, we are creating and expanding terminals specialized
for dispatching EC parcels (EC sorting centers) and EC delivery centers in collaboration with business partners. In this collaboration, Yamato Transport provides an operation system that links data, such as parcel information and customer requests forchange, in real time,
thereby enhancing
Real-Time Connection of YDP and EC Logistics Network
service quality andoperational effiEC logistics network system
YDP
Delivery support system (administrative operations)ciency throughParcel information
Dashboard/Ringscanner (center operations)smooth manageStatus information
CDA, a delivery app(delivery operations)ment of business
Real time collaboration
partner operations.

Before Revising Areasand Routes

After Revision

108

138

109
79

Course A volume of parcels: 138

Course A volume of parcels
excluding area framed in red: 108

Course B volume of parcels: 79

Course B volume of parcels
including area framed in red: 109

Area Management System Image
By confirming the volume of parcels by area basedon various factors, including delivery day and time,
information such as fluctuation in volume anduneven workload for each SD can be quickly
understood, leading to a revision of routes.

3A dvancement ofFulfillment Service

In the operation of the fulfillment service
that acts as an agent for a series of operations, from ordering products to their storage and shipping, order data from anorder management system for EC operators is linked in real time to shipping operations. This improves the efficiency ofshipping operations in warehouses,
reduces dead stock, and shortens leadtimes, thereby contributing to theenhancement of customer experiences.

 nhance efficiency of administrative operations through definition of operationalEstandards and digitalization

The Yamato Group is engaging in the development of humanbusiness growth.

We are supporting the expansion of the value we provide to customers and the enhancement of operational efficiency from a digital
perspective by utilizing the Yamato Digital Platform (YDP), our new digital platform, which understands various data in real time andcollaborates with internal and external systems.

 lexibly respond to changes in workload by visualizing workload and progress ofF
work in real time, etc.

TOPIC

Selection of DX Stocks 2023
Yamato was selected for Digital Transformation Stocks (DX Stocks)* 2023. During this selection, we were recognized for our efforts to promote business structure reforms in responseto the changing times, to promote the transformation of each customer’s entire supply
chain and enhance operational efficiency based on data analysis, and to create an organization and corporate culture. We will continue advancing initiatives for business structure reforms based on a structure for promoting data utilization through collaboration between the Business Department and Digital Department.
* Organized jointly by the Ministry of Economy, Trade and Industry, the Tokyo Stock Exchange, and the Information-technology Promotion Agency, Japan toselect and introduce TSE-listed companies that create in-house systems for enhancing corporate value while promoting DX and displaying outstanding performance in utilizing digital technology

Approximately 550 employees

YAMATO HOLDINGS CO., LTD.
Integrated Report 2023

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