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Announcement of the Interim Report Compiled by the Strategic Council for Creating Data-Driven Innovation-Toward Data-driven Innovation Removing Barriers between Fields and Organizations-

In June 2014, the Ministry of Economy, Trade and Industry (METI) established a Strategic Council for Creating Data-Driven Innovation, aiming to create and promote a new value-creating effort to utilize data beyond barriers between fields and organizations, which METI refers to as “data-driven innovation,” and now there are 200 or more private companies participating in the council.

The council has held three meetings and discussed challenges and measures for overcoming the challenges involved, and on October 31, 2014, at the fourth meeting, it compiled the results of the previous meetings into a report titled “Toward Data-driven Innovation Removing Barriers between Fields and Organizations.” METI hereby announces the report.

METI will hold workshops under the council and endeavor to develop legal systems, organize business environments, and formulate specific case examples, all of which are necessary for creating and promoting data-driven innovation efforts.

1. Outline

Recent IT advancement and development, such as network technology and information processing, have enabled people to collect and store a large amount and variety of data and analyze them appropriately and effectively, thereby bringing about innovation, including the enhancement of marketing efforts and other business activities and the development of new products.

Some mainly IT-related enterprises, both inside and outside Japan, have already succeeded in fortifying their competitiveness while creating new value by establishing novel business models by utilizing other companies’ data and open data in addition to internal data. These case examples indicate the importance of future efforts for creating data-driven innovation through the use of data beyond barriers between fields and organizations. However, with the exception of some leading companies, most Japanese enterprises have not recognized the full significance or importance of data utilization, and there remains a variety of challenges to be overcome before advancing the efforts to create data-driven innovation.

The compiled interim report outlines the list of challenges involved in creating data-driven innovation developed during the council’s discussions between industry, academia and government, as well as future directions toward the measures for addressing such challenges.

2. Foreseen challenges

The major challenges in creating data-driven innovation are as follows:

Challenges that organizations are facing in data utilization

  • No understanding of location or details of data
  • No understanding of advantages or risks of utilizing data from other organizations; no understanding of how to manage such data
  • Afraid of being involved in consumer-related trouble due to unclear legal systems, and thus hesitant to utilize data
  • No human resources with appropriate skill in handling data
  • No available positions for such data handling human resources

Challenges that platform businesses are facing in connecting different organizations

  • Having little trust from owners and users of data as business partners because of the new and unconventional nature of mediating data trading
  • Facing difficulties in raising necessary capital or business equipment due to the current limited scale of the market and highly-uncertain nature of the business
  • Facing difficulties in mediating processes due to lack of standardization of necessary business tools, e.g., ways of concluding contracts, pricing, and formatting

Challenges that organizations are facing as data owners

  • Not aware of the existence or value of data; not recognizing the value in providing data to other organizations
  • No utilization of internal data inside the organizations
  • Anxious about using unidentified data inside organizations, for which the owner is unknown
  • No understanding of how to provide data

3. Future directions toward the measures for overcoming the challenges

1) Collaboration between businesses

Through specific efforts, the council will conduct research for required environments, conditions and challenges found in promoting the use of data beyond barriers between fields and organizations, and will discuss measures for overcoming such challenges.

2) Relationship between businesses and consumers

Promoting data utilization requires easy-to-understand explanations for consumers about the ways that businesses handle personal data, so as to help the consumers sufficiently understand the situation and secure their trust. Based on this important understanding, the council will promote the use of 1) the Standards for Counseling and Assessment and 2) the Guidelines concerning the Online Services for Consumers regarding Notification on the Use of Private Data and Gaining Approval from the Consumer for Data Usage (the Guidelines), both published by METI, and will advance efforts to globally standardize the Guidelines.

3) Improving the related legal systems

The bill to amend the Act on the Protection of Personal Information is scheduled to be submitted in the FY2015 regular sessions of the Diet. In response, the council will appropriately encourage related authorities to stipulate necessary measures in the amendment of the Act from two perspectives: 1) protecting the interests of personal rights and 2) promoting the cultivation of new businesses through data utilization efforts.

4) Cultivating and fostering future leaders

The council will specify the ideal human resources and businesses necessary to lead innovative activities using data beyond barriers between fields and organizations, while promoting the cultivation and fostering of such leaders. In addition, it will endeavor to support the cultivation and fostering of the players to take on the new role of mediation in the data trading business.

5) Future management of the council

The council will continue to hold its meetings as they provide opportunities to promote information sharing and business matching efforts among data trading businesses, and it will also discuss ideal approaches to the council’s management, while considering collaboration with private associations and entities.

4. Calling for participants in a workshop

METI will hold a workshop as one of the efforts for creating data-driven innovation, in which participants from businesses will identify challenges in finding specific business-related ideas and commercializing the ideas and discuss measures for overcoming such challenges. As a participant, METI will call for businesses that have their own data, those that intend to use such data, and those that conduct intermediate data trading business.

Please refer to the following website for eligibility criteria. If you are interested in attending the workshop, please apply by November 7 (Fri.), 2014, according to the application procedures publicized on the website.
URL: https://www4.kke.co.jp/ddi/External Site Link (in Japanese)

Reference

Release date

November 5, 2014

Division in charge

Information Economy Division, Commerce and Information Policy Bureau

Related Information

Information Policy

Ministry of Economy, Trade and Industry
1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
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