DENSO deploys Microsoft 365 accounts for 22,000 factory employees in workstyle reform.

Microsoft 365 accounts were rolled out to all employees at manufacturing sites, especially factories, towards achieving manufacturing DX

DENSO is an automotive parts manufacturer that provides advanced automotive technologies, systems, and products on a global scale. The company’s seven business areas are Electrification Systems, Powertrain Systems, Thermal Systems, Mobility Electronics, Advanced Devices, Factory Automation (FA), and Food Value Chain. DENSO’s consolidated revenue is 7.1447 trillion yen, and it has 193 consolidated subsidiaries, 162,029 employees on a consolidated bases, and 43,980 employees on a non-consolidated basis (as of March 31, 2024).

Ever since the company was founded in 1949, DENSO has remained quality-centric while enhancing its management foundation and actively promoting innovative initiatives under the three DENSO Spirit elements of Foresight, Credibility, and Collaboration. The company has more than 130 world-first products, 41,000 patents, and has won 77 medals at WorldSkills Competitions.

DENSO, known for such achievements, has been making efforts from 2021 on a project that transforms on-site job satisfaction through utilizing IT. The company has provided all employees working at manufacturing sites, especially factories, with iPhones/iPads, and has issued Microsoft 365 accounts for each employee. Through enabling the use of various business applications such as chats, in-house portals, storage, and office suites, DENSO has fundamentally changed its on-site communication and collaboration.

Yusuke Yoda (Global Infrastructure Planning Department, IT Infrastructure Promotion Division), who has been the leader of this on-site transformation project since the initial stages, described the goals of this initiative.

“It is standard practice for on-site employees, including those at factories, to not have their own computers, devices such as smartphones and tablets, or elements such as email addresses. Even at DENSO, when there was a need to notify employees, we used to post paper notes on bulletin boards or have group or section managers verbally notify everyone at morning assemblies. When employees needed to propose something to the company, or when they needed to contact each other regarding work, they also made notifications on paper or through word of mouth. However, with the progress of digitalization, these methods could potentially disrupt internal communications and become an obstacle within on-site DX promotion. How can we encourage employees to use devices to support workplace improvement, share knowledge, and hand down skills? This triggered us to work on creating an environment in which all employees, from those working in offices to factories, would have the same working conditions.”

The second was the increase in man-hours due to using paper.

Mr. Yoda says “Notifications and applications were managed on paper, which created a burdensome workload for submissions and confirmation. Even for on-site surveys, there was a need to create surveys on paper and have each employee answer them before collecting and tallying the surveys. This was the same when applying for overtime. Despite office workers having a more efficient work environment due to digitalization, on-site workers were stuck in the analog era. The on-site environment did not make most of the benefits of digitalization.” .

The third was concerns toward the decline of employee job satisfaction.

Ms. Iwatsuki says “Although new workstyles incorporating online meetings and chat functions of Microsoft Teams had spread between office workers, on-site employees had been left out of this. As they did not have any means of digital communication, they were not able to propose ideas to the company when they had one, and were not able to exchange opinions with other employees. We were concerned that this environment would result in employees finding that work was no longer rewarding.”.

Executive management also felt a sense of urgency regarding this situation.

Mr. Yoda says “On-site employees, with no devices or email addresses, had no access to information. Discrepancies within employee treatment posed issues in both work satisfaction and promotion of DX. The executive management was well aware of this. There was a common understanding that to promote DX with employee satisfaction, it was essential for on-site employees to utilize mobile devices in the same way that office workers used mobile computers.”.

Starting out small by rolling out model cases and thoroughly providing steady training for basic usage

Although the initiative had support from executive management, there were still quite a few voices expressing concern that “information devices were not needed on-site, as the main task is to make products”. Furthermore, some on-site veteran employees were resistant to operating smartphones during work, as workplaces had traditionally made improvements without such technology. Additionally, some were not accustomed to using smartphones in the first place, due to being from a flip-phone generation.

Mr. Yoda and his team faced challenges in progressing with the initiative, and struggled to get employees on-board with the project company-wide and to make it personally relevant for on-site employees.

One important point in this project was to start small.

Mr. Yoda says “There are approximately 22,000 on-site employees assigned to 21 departments related to manufacturing. These 21 departments are spread across multiple plants, which are manufacturing bases. For domestic plants, there are 11 sites, including the Anjo Plant in Aichi, which manufacturers starters and inverters, and the Daian Plant in Mie which manufactures ignition devices and advanced safety-related products. We first aimed to create a successful example at one department and gradually expand horizontally to manufacturing divisions and plants. Doing so would allow everyone to gradually understand the aim and effects of incorporating devices.”.

Three production departments at Daian Plant and Anjo Plant were selected to be the starting point for this initiative. Each department was led by a manager with a proactive mindset, and offered full cooperation in promoting the use of devices and verifying the effectiveness within their section. After approximately six months of testing, it was confirmed that an average of 3.4 man-hours were reduced per employee with the use of devices. Using these results as a model case, efforts were expanded from sections to manufacturing departments, and from departments to plants. Furthermore, these managers were passionate supporters of this initiative, and actively accepted requests for tours and training from other departments.

The second important point was teaching basic use of devices and steady training for use.

Ms. Iwatsuki says “We knew that just handing over devices would not lead to employees using them. We made it a point to offer personalized support, visiting work sites and guiding each employee with things such as, ‘First, try sending a message to Teams just like using your own smartphone,’ ‘This is how to take a photo with the iPhone camera and send a message,’ and ‘This is how to use flick typing’. There are many younger employees on-site who are accustomed to using smartphones. This initiative resulted in younger employees teaching veterans how to operate smartphones, leading to new forms of communication that had not existed before. Furthermore, veteran employees, who had only used flip-phones up to that time, started to send emojis and stickers to younger employees. Through the process of visiting all 21 manufacturing divisions through approximately two years, this was the moment we truly felt that employees recognized this project as relative to them.”

The culture of on-site improvement worked to accelerate adoption of digital tools

DENSO completed deployment of individual devices and Microsoft 365 F3 to 22,000 on-site employees by the end of December 2023. The effects of this initiative are being seen in many ways.

The first effect was the fundamental change in how on-site employees communicated.

Mr. Yoda says “Deploying devices created a major change in how information was accessed. Information that used to be communicated on bulletin boards and morning assemblies is not shared in Teams group chat rooms organized by sections and offices. All necessary information can be acquired via Teams, and an employee can ask questions and receive answers on Teams if more details are needed. Furthermore, employees can make calls via Teams to talk if necessary. Although we spent a lot of time teaching and training basic use of Teams, we decided to leave its further application to the on-site employees. Approximately six months from the device roll-out, we started to see employees using the device in their own creative ways, such as submitting applications or conducting surveys using Teams. It looks like our culture of on-site improvement is alive and doing well.”

The second effect was the reduction of man-hours with the shift from analog to digital technology. Although a monthly reduction of 3.4 man-hours per employee had been confirmed at the testing stage, after a company-wide survey was conducted for confirmation, they found that there was an average reduction of one hour per employee per month.

Ms. Iwatsuki says “Reponses from 9,000 employees were tallied for the survey, in which we asked how many minutes per week had been saved through more efficient information sharing and reduction of management work-hours. Although results differed between departments, we believe that introducing this initiative had a significant impact on work efficiency. Furthermore, we know that the investments for this project will be recovered in 1.5 years.”

The third effect was the improvement in employee work satisfaction towards manufacturing DX.

Ms. Iwatsuki says “Although it is difficult to express in numbers, for example, the survey question of ‘Did using devices improve the work atmosphere?’ received many positive responses. I believe this can also be seen in how veteran and younger employees are using Teams to communicate, with younger employees teaching veterans digital technology and veterans teaching younger employees on-site manufacturing know-how in turn. Furthermore, there was also a strong correlation between the responses for ‘The devices are useful’ and ‘Work feels rewarding’. We can say that deployment of devices resulted in a more comfortable environment for employees to work in.”

Another point is the acceleration of the use of Microsoft 365.

Mr. Yoda says “Before this initiative, we used to notify employees of equipment failure and maintenance status at morning assemblies, but now we are able to take photos of the situation and send information through tools such as Teams. In this way, there are more cases in which photos, videos, and chats are being used for various daily reports and communications. Additionally, efforts such as using SharePoint or OneDrive as repositories for accumulating know-how, and creating on-site incident reports and analysis applications using PowerApps have started to emerge. What is more, we have started to hear voices expressing a desire for a system that can be linked with core systems, such as attendance and business trip systems.”

Using Microsoft Intune to secure company-wide security and compliance

The major reason why DENSO selected Microsoft 365 F3 as an on-site communication tool was because Microsoft 365 E5 had already been incorporated for office workers.

Mr. Yoda says “To construct the same system environment as office workers, we were able to expand existing device and security management mechanisms as it is for on-site employees. Setting up devices and accounts for 22,000 employees requires an enormous amount of man-hours, including kitting work. In this regard, Microsoft 365 F3 and E5 enable centralized endpoint and security management using Microsoft Intune. We created a new automated kitting workflow using Intune to enable smooth deployment for 22,000 units.”

These iPhone devices are only allowed in-house use via Wi-Fi and are prohibited to be taken outside of the company. Despite this, there are still security risks such as unintentional take-out of devices from the company, loss, and unauthorized access. For this reason, the company has prepared responses to various risks with remote wipes and locks using Intune, along with prevention of data loss, privileged access management, and insider risk management using the Security and Compliance option.

Mr. Yoda says “From a system perspective, saying that the project was guaranteed to be a success the moment we decided to adopt the Microsoft 365 F3 would not be an exaggeration. When attempting to incorporate a digital tool that all on-site employees would use, a tool other than Microsoft 365 would not have rolled out so smoothly, and there would have been a heavier burden of operation and management after the system was deployed. Microsoft 365 F3 is a very cost-effective system that provides all the essential functions needed.”

Ms. Iwatsuki also added the following.

Ms. Iwatsuki says “I believe one important aspect of this success is that we were able to apply one design to the overall project. Once employees learn how to use Teams or SharePoint services, they will be able to apply the same know-how at any department. Microsoft 365 F3 offers the same functions as the E5 version used by office workers, and it can be used in the same way as one’s usual smartphone. It is a tool that easily enables improvement from an on-site perspective.”

Going forward, Microsoft 365 will be deployed to approximately 160,000 employees at 193 affiliated subsidiaries. DENSO is also looking at expanding this initiative towards group companies within and outside of Japan. Microsoft 365 will continue to support DENSO’s manufacturing DX initiatives, which is now entering full-scale implementation.

* Affiliated departments, positions, and other information are as of November 2024.