Consideration on DX and Corporate Growth: The process of linking DX in manufacturing sites to corporate growth and its inhibiting factors

Abstract

The purpose of this paper is to examine the process of linking the achievements of DX (Digital Transformation) in the manufacturing industry to corporate growth, and to discuss what hinders this process. Japanese companies have so far focused on improving operational efficiency and building cross-organizational manufacturing processes as part of their DX initiatives, achieving certain results. This can be considered a path-dependent innovation in the Japanese manufacturing industry, which has historically built its competitiveness on production sites, exemplified by the Toyota Production System. On the other hand, to monetize, the necessity of DX aimed at the market, such as "enhancing the added value of existing businesses through the introduction of digital technology" and "creating new digital businesses," is emphasized. This view stems from the concern that Japanese companies' DX initiatives remain limited to improving operational efficiency and do not lead to the creation of new value.

So, why does it not lead to value creation? What are hindering factors? This paper will examine the process by which Japanese companies can link the achievements of DX at the production site, in which they excel and have cultivated, to revenue and achieve corporate growth.