1. Management Direction and Direction of Utilization of Digital Technology, etc.

(1) Impact of digital technology on society and the company’s competitive environment.

Since its establishment in March 2014, the company has consistently provided products and services that support productivity improvement through digital innovation in the small- and medium-sized manufacturing industry. Since most of the manufacturing in Japan is carried out by small- and medium-sized manufacturers, the improvement of their productivity is expected to have a significant impact on the Japanese economy.

Many small and medium-sized manufacturers have been trying to improve their productivity by introducing state-of-the-art machinery and compensating for the shortage of on-site workers. However, the reality is that overall factory productivity has not improved due to bottlenecks in office, design, inter and intra-process setup, inspection, shipping, and other operations.

Furthermore, in order to respond to the shift of manufacturing back to the domestic market and to strengthen the domestic supply chain, it is necessary to dramatically improve the overall productivity of small and medium-sized manufacturing enterprises by utilizing digital technology. As a company that specializes in supporting and realizing digital transformation of small- and medium-sized manufacturing companies, we will take the lead in this effort to realize DX for the entire factories and companies of our client small- and medium-sized manufacturing companies.

(2) Management vision and business model.

Since its establishment, the Company has been engaged in the development and sale of software that contributes to the digital transformation (DX) of small and midsize manufacturers, with the mission of contributing to the improvement of customers’ sustainability, and has adopted the management philosophy of “Creating the future for our customers and sharing our destiny (together with our customers)”. We are engaged in business activities based on the following business model.

We are engaged in business activities based on the following business model: Improvement of overall factory productivity (realization of smart factories) by visualizing factories and reducing setup time, etc., without changing the current workflow, utilizing customers’ existing assets (machinery and software).

In order to take advantage of the world’s most advanced digital technology as quickly as possible, we have established a development base (wholly owned subsidiary) in India to conduct original software development. We have also established a team of engineers in Japan to support customers and provide services through a Japan-India engineering collaboration system.

To allow customers to experience our software, we have established a demonstration processing center in Atsugi City, Kanagawa, and a technical center in Nihonbashi, Chuo-ku, Tokyo. This enables visualization of factories and hands-on experience with manufacturing simulations.

Direct sales system with sales consulting by our employees to ensure that customers fully understand our products and services before introducing them.

2. Strategies to realize management vision and business model

Based on social trends, we will continue to enhance the sophistication of our products and provide new products and services in order to promptly respond to productivity improvement through DX in many small- and medium-sized domestic manufacturing industries. To this end, we will develop, introduce, and promote our internal DX promotion system. This system will contribute to the improvement of our customers’ productivity by enabling the system to track the startup, provision, operation status, issues, and proposed solutions for our products and services for customers.

3. Implementation Structure to Promote the Strategy

In order to efficiently promote the above strategies, the following structure will be implemented.

            Person in Charge           Representative Director Toshio Takagi

                Supervision                Director COO Nobuo Takagi

       Development Manager       Director CTO Thanapandi Periasamy

          Operation manager          Director and Technical Manager Miho Yamamoto

            Promotion office             Toshiaki Matsunaga, General Manager of Management Headquarters

    April 1, 2023

    alfaTKG Co., Ltd.