Komatsu supports Midori-Kai member companies in a variety of ways. Main support activities that we have carried out are described below.
Komatsu provides support for the establishment of systems for safety activities and improvement of the activity level to 99 companies, the majority of which are custom goods suppliers out of the Midori-kai in Japan. The support includes continuous safety patrols by specialists from Komatsu, sharing information and horizontal application of occupational safety measures conducted by other companies, the introduction of management system, and so on. These activities are also carried out at the Midori-kai in China.
In addition, due to our business partners' labor shortages, there has been an increase in the number of foreigners, older adults, and women working onsite. Some of the workers from these groups have sustained injuries. In response, we have continued to provide support by making safety and health-related documents, such as work standards, available in multiple languages and creating a workplace environment that is less physically demanding for the elderly and female employees.
Using check sheets and on-site patrols we conduct surveys to ensure compliance, particularly with laws (e.g. reports and inspections), unsafe locations on site, and the existence of unsafe actions. If anything problematic is found, we request the submission of a countermeasure report, which describes the measures to prevent recurrence, as a follow-up. In FY2017, we reviewed the check sheets and evaluation criteria so that we would be able to use the same standards to evaluate the activities of Midori-kai members company-wide and follow-up (One-rank-up Activities) with them to improve the level of each company every year.
In the follow-up, we also train on-site supervisors of business partners through fixed-point observation of work cycles on site and joint implementation of risk assessments.
To eliminate serious accidents, we regularly conduct comprehensive inspections of the safety devices installed on automated lines and machines and the operation of these devices, forklift and crane operations, and the status of the standards established for working in high places, using a unified check sheet. In particular, we are promoting safety measures for automated lines and machines, due to the policy to secure safety, not only by operators’ caution but by machines’ function and/or mechanism.
One of the Midori-kai committee activities is the implementation of mutual safety patrols by business partners with similar business standpoints. We also put a lot of weight on inspecting from perspectives specific to each business category (e.g. the handling of heavy goods or the risks of touching hot surfaces).
Executives from the Midori-kai member companies in Japan participate in the Komatsu Group Safety and Health Conference, which is held in June every year. Excellent Zero Accident circles selected from Japanese and Chinese Midori-kai member companies provide presentations about their activities. In addition, we open the Safety Dojo (Safety Training Hall), a facility included in each Komatsu plant, to our business partners, aiming to improve the safety awareness of the employees of each company through danger simulation experiences and danger prediction training.
We select companies that have had repeated accidents as target companies for Special Safety Activities and provide special support and guidance according to the unique situation of each company.
To increase the level of the activities at each company, we support them in their establishment of their own occupational safety and health management systems, including ISO and OSHMS certification. In 2015, we supported 97 companies that implemented Japan Industrial Safety and Health Association (JISHA)'s Workplace Safety Health Impact Project for small and medium-sized businesses, and they are using the project to objectively evaluate their own activities.
Changes in the results of safety activity evaluations from 2018 to 2022 (99 Midori-kai member companies, 116 offices)
Changes in the number of accidents at Midori-kai member companies in Japan and China Table 1
Status of one-rank-up activities
The Komatsu Group conducts compliance and risk audits (CR audits). In 2016, we began to conduct the CR audits even for 9 out of the 15 business partners in which Komatsu has made minority investments and which are located in Japan. The audit is conducted in four fields -- accounting, labor management, procurement (the Subcontract Act) and information security. It is aimed at identifying potential risks and taking corrective measures at an early stage. The risks are identified mainly by checking the status of compliance with relevant laws and regulations, confirming business rules, segregation of business and decision-making authorities, inspecting relevant business documents and conducting on-site examinations. Voluntary establishment of compliance systems by business partners is essential for promoting CSR procurement. We believe that such a system should desirably be established by 1) formulating rules (establishing codes of conduct of each company), 2) building a structure for promoting CSR procurement (including the appointment of persons in charge of CSR procurement and practical affairs), 3) introducing a whistleblowing system, and then 4) providing employees with awareness training. Under this policy, we provided support to 99 companies, mainly custom goods suppliers belonging to the Midori-kai, for their establishment of compliance systems by providing practical examples at Komatsu and employee training materials, etc. As of the end of FY2021, we have completed support activities for all of the companies. The follow-up after completion of the support activities and the inspection of the status of the activities of major business partners will involve a SAQ survey.
In FY2022, no serious violations of Japanese labor-related laws and regulations or environmental violations were reported by any of Japan Midori-kai's 156 companies.
The problems found by CR audit and countermeasures
| Items | Problem found by audit | Countermeasures |
|---|---|---|
| Finance & Accounting | Missing/Insufficient operation flow, rules | Review flow and rules Instruct the manner of inventory check |
| Missing/Insufficient periodical inventory check | ||
| Insufficient rule for disposition of absolete stock | Separate approvers and applicants | |
| Inadequate control on company official seals/password/authority management | ||
| Labor Control | Inadequate labor contract | Change to direct employment Review timecard system |
| Inadequate working time management | ||
| Subcontract Law | Missing/Insufficient description on purchase order sheet | Review format Review operational flow |
| Risk for delayed payment | ||
| Risk for advanced offset of supplied materials | ||
| Risk for irrational discount | ||
| Insufficient rule to get written acceptance from suppliers in case of order cancellation. |
Result of CR audit to Level-1 Critical Suppliers
We believe that the greatest support that we can provide to the Midori-kai is human resource development. Based on this belief, we provide various job-level training programs as listed below. Since 2020, it was necessary to cancel most of the face-to-face training programs due to the COVID-19 pandemic. In their place, a remote education curriculum using an online meeting system was provided to the Midori-kai companies to provide materials for employee training. In FY2022, we were once again able to hold in-person production engineer training.
Among the support activities, we have particularly been committed to Management Salons and skills transfer activities in recent years. Management Salons are aimed at developing young individuals in management positions, who have recently taken on new business responsibilities. Through these events, Komatsu executives analyze the current strengths and weaknesses of each company and exchange views on the medium-term management visions of the companies with their counterparts to align and share management policies and ideas. The skills transfer activities are aimed at facilitating the improvement and succession of the on-site skills of each company. In these activities, we help each company build systems for promoting skills transfer and skills evaluation and develop instructors in core skill fields by disseminating our own knowledge and skills.
Training and Other Programs for Midori-kai Member Companies
| Target job level | Program | Outline | Major achievements | FY2022 results |
|---|---|---|---|---|
| Management | Commissioned training | Komatsu accepts sons and daughters of corporate managers of member companies and provides them with on-the-job training for up to five years. | 56 trainees have been accepted since 1972. | 1 person |
| Middle management training | Komatsu's training program for its executive candidates is open to candidates for member company successor. Duration of the training is seven months. | 29 people have participated since 2005. | 1 person | |
| Management Salons | Young corporate managers of member companies make presentations on medium-term management visions of their respective companies, which are discussed and shared with Komatsu. | Provided to a total of 28 companies since 2014 | 2 companies | |
| Employees in managerial positions | Managerial training | For newly appointed managers and on-site job leaders (e.g. general managers of centers and team leaders) | Around 40 people participate every year. | 32 people |
| Leader training (for field managers) | Exclusive training programs for the Midori-kai. The training is provided two times a year. | Around 60 people participate every year. | 35 people | |
| Representatives | Komatsu Technical Institute | Intended for leader candidates related to production engineering and manufacturing who are aged 30 or younger. It is a boarding school which provides a two-year program. | 30 people have entered since 2008. | 1 company |
| Production engineer training | It is an exclusive training program for the Midori-kai on sheet metal processing and mechanical engineering. Five-day training is provided once a year. | Around 40 people participate every year. | 25 people | |
| Skilled workers | Instructor training | A 30-day program for candidates for skilled instructors of each company | 141 people have participated since 2015. | 14 people |
| Inspection training school | Inspection skills training and classroom lectures | Held as needed | 40 companies | |
| Others | All Komatsu QC competition | Participants are selected from among the Midori-kai members. | Around 20 companies participate every year. | 6 companies |
| All Komatsu skills competition (Advanced Technique Contest) | Participants are selected from among the Midori-kai members. | 13 companies, 18 people | ||
| All Komatsu Safety Competition | Participants are selected from among the Midori-kai members (report on Excellent Zero Accident circles’ activities). | Around 5 companies participate every year. | 6 reports (including 2 from overseas) |
Addressing the issue of the labor shortage, which has been growing more seriously in recent years, is an urgent task for Komatsu and members of the Midori-kai as well. We promote the networking of production sites and facilities by making effective use of ICT (Kom-mics) and using the network to improve productivity and save human resources. As a countermeasure against the labor shortage, we are expanding these activities to members of the Midori-kai proactively. Tools such as ones for monitoring operating rates that we developed on our own (K-MICS PAD) automatically collect data, including operational status and operating conditions, from the controllers of machine tools and welding robots of each company. These data are accumulated on the network, and processed and edited on a PC with application prepared for each purpose. We thus visualize the issues that need to be overcome to improve the operating rate, leading to collaborative analysis and implementation of measures.
Outline of Kom-mics
Changes in the number of K-MICS PAD units installed at suppliers' site
The situation of productivity improvement through the utilization of K-MICS PAD
Natural disasters such as earthquakes, heavy rains and typhoons have frequently occurred in recent years. Worse, there are new clear risks such as the COVID-19 pandemic, cyberattacks. The importance of establishing a BCP system for the supply chain is increasing. Starting after the Great East Japan Earthquake in 2011, Komatsu has provided support by implementing measures to withstand earthquakes and water damage, etc. at the buildings and facilities of 104 companies, mainly custom goods suppliers belonging to the Midori-kai. In addition to these tangible measures, it is also necessary to strengthen intangible measures, including the establishment of an initial response system by creating a BCP manual, etc., and a system for facilitating early restoration of business operations. Since FY 2019, we have held BCP workshops for 104 Midori-kai member companies, mainly focusing on support for the establishment of their own initial response systems.
In the future, we will extend our support to activities to enable the system take root through simulations and other activities, something that many of our business partners believe necessary for the promotion of BCP, and to proactively prepare to restore business operations (e.g. the sharing of information, dispersion of in-house production capacity, consideration of collaboration with other companies in the same industry).
Issues to consider when advancing the company’s BCP (responses obtained from 87 Midori-kai companies)
