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“DX Report 2 (Interim Report)” Compiled as Interim Report by Study Group for Acceleration of Digital Transformation

December 28, 2020

Aiming to encourage Japanese companies to accelerate digital transformations (DX), the Ministry of Economy, Trade and Industry (METI) held discussions on actions that companies should take and response measures that the government should take, and released an interim report titled “DX Report 2 (Interim Report)”.

1. Background to inaugurating the study group

In September 2018, METI released a report titled “Report on Digital Transformation: Overcoming of ‘2025 Digital Cliff’ Involving IT Systems and Full-fledged Development of Efforts for Digital Transformation” (hereinafter referred to as “DX Report”) and, since then, it has been developing a variety of measures contributing to DX promotion throughout Japanese companies as seen in its publication of the DX Promotion Guidelines and the DX Promotion Indices.

As two years have passed since the issuance of the DX Report, more and more domestic companies feel a rising sense of crisis in their current circumstances surrounding DX. Some companies have already embarked on efforts for DX, but others have not yet started.

Moreover, as the novel coronavirus disease has been spreading globally from early 2020, environments surrounding companies have become very unstable and the organizational reform to address these new business environments is the highest priority issue for all industries to tackle. With this situation, quick responses to environmental changes and actions to change not only the existing systems but also corporate cultures are essential challenges related to DX that companies should address.

As the roles that IT vendors are required to play are also changing in accordance with the directions that companies should take in advancing DX, it is necessary to redefine the value that IT vendors should provide and establish new relationships between such vendors and user companies.

Against this backdrop, in August 2020, METI inaugurated the Study Group for Acceleration of Digital Transformation (chair: Dr. Aoyama Mikio, professor, Department of Software Engineering, Faculty of Science and Engineering, Nanzan University) and a working group under the Study Group whose responsibility it is to discover environmental changes to which companies are being exposed due to the spread of the novel coronavirus disease and to hold discussions on the difficulties in encouraging Japanese companies to accelerate DX based on these changes as well as on ideal approaches to related measures to address these issues. Since then, the study group has held repeated discussions on these issues.

Based on the results of the discussions by the study group, METI compiled a report consisting of the advantages and necessity of implementing DX, which were revealed by the spread of the disease and a list of actions that companies and the government should take in response and hereby releases it. The study group will continue to discuss topics which it has considered at its past meetings toward the end of FY2020.

2. Highlights of the report

  1. DX policy since the release of the DX Report and results
  2. Events seen during the spread of the novel coronavirus disease, and advantages and necessity of implementing DX revealed by the spread of COVID-19
  3. Dissemination of digital services and increased urgency of DX caused by the disease
  4. Actions that private companies should take towards organizational reforms
  5. Governmental policies supporting private companies in advancing reforms

3. Related material

For further information, see the Japanese language release.

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