Revolutionizing Corporate Culture (2):
Human Capital Management Taps Individual Capability

Young employees bring great potential hidden in formative experiences

Back when the economic system revolved around mass production and mass consumption, Yokogawa and fellow manufacturers focused on demand forecasting and planning along with sustaining the PDCA cycle based on scheduled plans and KPIs. In today's VUCA (Volatility, Uncertainty, Complexity, and Ambiguity) era with its unforeseeable future, however, simply executing plans is no longer enough; one must have antennae that are increasingly alert to external environmental changes, be agile and adaptive to change, and implement with great flexibility.

That also applies to many businesses and HR development sites, where seeking and testing new approaches is so important. Business operations must undergo a significant transition from a plan-driven model to an execution-driven one, learning amply from the process of executing new approaches. Outsiders may note the detour and seemingly wasteful trial-and-error method, but this process is precisely what provides learning and growth to both organizations and individuals. Going forward, it is vital to willingly and continually partake in these incremental experiments to make progress.

Tamaki believes that engaging in this continual experimentation and dialogue, modifying the plan as one proceeds, creates an upward spiral that makes learning more effective. Project Lotus, the previous HR development program, began as an in-house experimental effort and developed from there. Members' requests and market conditions helped the plan evolve and eventually take on external collaborators and a new name: Future Co-creation Initiative.

Two years after the launch of Project Lotus, a young employee who had participated in the training approached Tamaki to request the opportunity to engage in further co-creation activities. Meanwhile, another Scenario Ambassador informed Tamaki that the “input” process had generated a desire to protect the next generation and the planet. The number of Scenario Ambassadors sensing value in the activities was unmistakably on the rise.

At the same time, several client and business partner management teams offered feedback indicating that they would like to continue the co-creative dialogue addressing social and industrial horizons. Thus, in April 2021, Project Lotus evolved into the Future Co-creation Initiative, a cross-organizational team that reports directly to CEO Hitoshi Nara. As a side note, the symbolic word “co-creation” was lifted from the proposal by the young employees who were so eager to continue these activities.

From an HR perspective, Matsui has nothing but praise for the proactive advocacy of activities by Yokogawa's young employees. “The Future Co-creation Initiative team is mainly comprised of millennials, so there is a recognizable lack of knowledge, skills, and experience. However, they are laying the foundation for excellent formative encounters. These encounters, I believe, are precisely what will break the mold in HR development.

“After all, inputting knowledge into human minds does not mean it can be acted upon as is. If we don't fully understand something, we can't take it seriously. This is the unique difference between training and the Future Co-creation Initiative. A person who has mastered something generates power and enthusiasm. It ultimately becomes an expression of will. Accumulating formative experiences in this manner should later enable us to display strength on a larger stage.”

 

Future Co-creation Initiative: the value of mindset change

In December 2022, Matsui joined Scenario Ambassadors at a training camp in Kanazawa City on the Japan Sea coast. Matsui was surprised by the strength he saw in the younger members as he shared a meal and sat in a circle to chat with them.

“Some knowledge is gained through legwork. And some is acquired through reading assignments. The team also learns about frameworks. The members boldly hold their own when meeting all sorts of business leaders. Those young employees were co-creating what they thought was good, an experience which seemed to fill them with confidence.”

Matsui recognizes the excellent young employees in the Future Co-creation Initiative as the momentum behind the rapid professional growth among members. Matsui shared how delighted he was to receive praise from our Future Co-creation Partners.

“I've been complimented on our excellent young employees and how our free and progressive HR development is the envy of others. Of course, as we are a company, educating to fit the mold is also an important process. However, simply sticking to that does not help foster individuals. Just as in Japanese martial arts, where practitioners follow the shuhari, or the three stages of learning the concept of mastery (conquering the fundamentals, breaking away, and creating one's own techniques), we must remain mindful that once we have learned the format, boldly breaking the mold is imperative. That may entail taking action to break through in multiple directions, but nothing can beat growth, even if it means bumping your head and experiencing pain.”

At the same time, “We must learn new things to achieve growth,” says Tamaki. “However, companies that focus solely on efficiency and results are not positioned to incorporate creative learning opportunities geared to the future into their day-to-day business.

“If we give those with room to grow the opportunity to learn independently, they will achieve both growth and maturity through that learning process. Sharing what one has learned defines the Future Co-creation Initiative mindset. The key phrase capturing that essence is 'a weak tie but a trusting relationship.' In other words, the individual has a presence based on mutual empathy in multiple lateral communities, both within and external to the company, in addition to the company's vertical organizational line.”

Matsui points out that, nonetheless, this type of mindset is a culture foreign to Yokogawa's traditions. “Yokogawa's power of execution is amazing. However, we seem less skilled at maintaining multilateral weak ties. I don't mean to be self-deprecating, but if we only act based on past successes, we may fail to deliver what is expected of us on the global stage.”

That is where mindset change comes into play, insists Matsui. “We must dynamically alter both Yokogawa's organizational and individual mindset. Future Co-creation Initiative activities are one movement leading that change. To quote a famous Japanese military commander, 'people are stone walls,' which suggests that a castle is useless without the strength of its people. The stone walls are strong because of their shared empathy.

“In the end, our efforts to predict the future fail, as that future continues to change. Yet organizations whose members resonate with one another and groups that can co-create with internal and external partners have an unimaginable level of power to adapt to change. This is the value we expect from the Future Co-creation Initiative, and it is perhaps the greatest value of all.”

 

Better connections: the goal of human capital management

In 2021, the Future Co-creation Initiative was selected as a recipient of the “Japan's HR Award 2021” (Corporate HR category), hosted by Nihon no Jinji-bu, the largest HR network in Japan, under the auspices of the Ministry of Health, Labour and Welfare.

The Initiative also won a Special Award at the 2022 Yokogawa Group Awards Ceremony, a companywide global ceremony. The award spotlights teams and individuals in the Yokogawa Group who have made significant contributions, honors their achievements, and encourages the recognition and understanding of exemplary behavior among all employees.

Matsui remarks, “The Special Award was received in recognition of the uniqueness of the Future Co-creation Initiative and its success in co-creating with external stakeholders and expanding these activities. It also acknowledges the effectiveness of incorporating the future scenarios into the Medium-term Business Plan and Long-term Business Framework.”

Moreover, in 2022, Yokogawa was once again chosen as a component stock in the World Index of the Dow Jones Sustainability Indices (DJSI World), a global index for ESG investment. Is it possible that the Future Co-creation Initiative was a factor in the selection? Matsui offers his own view.

“As the DJSI is a vast conglomerate of various indices, the Future Co-creation Initiative alone does not score points. However, as an activity that does not appear in the financial indices, I believe it greatly contributes to fostering a new corporate culture.

“Nonfinancial information is crucial, with the major part relating to human resources. I think Future Co-creation Initiative activities are a plus when considering Yokogawa's human resources.”

One cannot overlook the possibility that such activities will ultimately contribute to a better society. Matsui remains hopeful of that eventuality. “I find it unique that individual and corporate growth, plus transformation into a more sustainable society, are all organically connected. The Initiative is still in its inception, but I think it is worthwhile, as we can discover how it is valued by society.”

The Future Co-creation Initiative will continue its efforts to put human capital management into practice.