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Messages from Keidanren Executives June, 2016 Encouragement for Reforming Work Styles

Masahiro OKAFUJI Vice Chair of the Board of Councillors, Keidanren
President & CEO, ITOCHU Corporation

There is an unprecedented labor shortage in the market. Of the three resources most important for managing a company -- human resources, goods and money -- the overflow of goods has resulted in deflationary concerns in industrial countries and China, and ongoing quantitative monetary easing in Japan and Europe has brought about an oversupply of money, such that money no longer earns interest. In contrast, the shortage of human resources in Japan has become a serious issue for management.

At a time when it is increasingly difficult to secure human resources, choices available for companies to continue growing are human resources development, automation and information technology adoption. But it takes time for training effects to take place and not all human resources shortage can be replaced by automation. Such being the case, a realistic and most effective choice would be to boost the capability of existing human resources, that is, to change the work style, providing an environment where diverse human resources may further exert their capabilities.

ITOCHU has introduced the "morning-focused work style" with the aim of raising operational efficiency and leveling the playing field for female and other employees unable to work late-night overtime due to child-raising or nursing care. Specifically, this system bans working after eight at night, in principle, and alternatively, our system pays extra wages for early morning work until eight, and provides free light meals. As a result, career-track employee overtime has been reduced by twelve percent after implementing the system.

A major benefit for the employees has been open weeknights for self-improvement, networking, and for families to spend time together and share housework. For the company, broadening the scope of human resources utilization has not only increased operational efficiency, but also has led to a reduction in expenses, including a seven percent reduction in overtime payments and a six percent drop in office electricity consumption, covering more than the cost of light meals.

By supporting employees with small children and social advancement of women, the "morning-focused work style" contributes to the realization of dynamic engagement of all citizens advocated by Prime Minister Shinzo Abe, and free time gained from reduced overtime will increase consumption and aid economic revitalization. This is a clear case of sampo yoshi, meaning satisfaction for three sides -- in this case: good for employees, good for the company, and good for society. Rather than being bound by conventional practices, why not think about reforming work styles in a way that fits your organization?