Human Resources Strategy

Refining the Engagement Improvement Cycle to Link Business Strategies and Human Resources Strategies and Create Greater Corporate Value

In order to more tightly link our business strategies and our human resources strategies, the Canon MJ Group added the establishment of an engagement improvement cycle to the basic policies in the Medium-Term Management Plan (2022-2025). The engagement improvement cycle is composed of three elements: development of skilled personnel, customer satisfaction, and employee job satisfaction. Employees who empathize with our Purpose and who seek to embody it will actively work to improve their skills, and this will lead to the development of skilled personnel. As a result, the value that we provide to customers will increase, leading to greater customer satisfaction. Increased customer satisfaction will give employees a greater rewarding sense of contribution, producing employee job satisfaction. This improved job satisfaction will motivate employees to grow, which will link back to further development of skilled personnel. We are seeking to refine this virtuous cycle. We are now in the process of identifying the items between these three elements of the engagement improvement cycle, together with the connections between them, and formulating corresponding indicators.
In formulating indicators, we believe that it is important not to simply focus on financial-related indicators, but also to have non-financial-related indicators through which employees can get a rewarding sense of contribution to society. These two types of indicators are closely intertwined in the engagement improvement cycle. We will link these financial-related indicators and non-financial-related indicators, visualize and refine our initiatives, and strive for sustainable growth throughout the Group, in individual companies, and in individual departments.
The Group has achieved record high profits for four consecutive fiscal years by solving customer issues with our products and solutions, providing customer satisfaction that is reflected in our business results. I feel that this strong business performance is increasing employee job satisfaction and creating a virtuous engagement improvement cycle.

The foundation of the engagement improvement cycle is made up of meritocracy, position-based pay system, and values and action guidelines.
The Group has adopted meritocracy as a guiding principle in the Canon Code of Conduct. Our employees are evaluated fairly, not equally, and treated in a fair and just manner. This motivates employees to improve themselves.
This meritocratic approach has been a consistent part of the Group since its foundation in 1968, but in 2001, we introduced a position-based pay system in which remuneration is determined by work positions and results, not age or years of service. Thereby we are striving to make the Group even more meritocratic. This system does not look at results alone, but also evaluates work processes, producing a structure in which employees can demonstrate their full potential.
Another part of Canon’s Code of Conduct is the “Three Selfs” spirit of self-motivation, self-management, and self-awareness. Values and action guidelines centered on the “Three Selfs” have been defined for the work employees perform. Our goal is not individualism, but the vitalization of individuals and the organization by having the efforts and results of highly self-driven individuals create a powerful organization and generate maximal results. Workstyles based on these values and action guidelines are deeply rooted in the Group’s corporate culture, and these concepts are always cherished.
Our meritocracy, position-based pay system, and values and action guidelines are carried on ceaselessly, contributing to greater employee job satisfaction and the improvement of our corporate value.
This corporate culture is the foundation of the engagement improvement cycle and one of the Group’s strengths.

In the development of skilled personnel, we are implementing initiatives on two fronts: acquisition and development of specialist personnel to achieve our business strategy, and further improvement in productivity, thereby growing the Group’s business.
In developing specialist personnel, we are continually implementing skill improvement initiatives. Ever since the Group was founded, we have constantly responded to changes in our customers and markets, taken on new challenges, and expanded our business domains. The skills we need are constantly changing as our business domains expand. Since the 1980s, when our dealings in other companies’ IT devices and software started to increase, we have been continuously engaged in employee reskilling. The Group’s business operations are wide-ranging, so we need exceptional human resources in each business domain. Currently, each department is defining the skills needed for its business strategies in order to reliably achieve the goals set in the Medium-Term Management Plan (2022-2025). Departments categorize them into levels 1 to 5, identify the gap between the number of employees they need and the current numbers of employees at each skill level, and formulate and implement training plans to address any gaps. Through this, we are carrying out the development of specialist personnel. Furthermore, to accelerate the growth of the IT solutions business, we have established a new specialist level certification system for highly skilled IT personnel. The certification is based on employees’ possession of high level specialist qualifications and their track record of work that leverages these qualifications.
To recruit human resources from outside the Group, we actively conduct mid-career recruitment of professional personnel whose skills can be put to immediate use in each business domain. Particularly, Canon IT Solutions is primarily responsible for recruiting IT personnel such as systems engineers. Although the overall hiring environment for IT personnel is said to be challenging, the Group was able to secure more IT personnel in 2024 than the previous year, including both mid-career hires and new graduate hires. This is due to the high expectations for the growth potential of the Group, which is primarily focused on the IT solutions business, as well as the educational systems we have developed and our pioneering introduction of a position-based pay system.
We are also working for further improvement in productivity by raising basic skill levels. Regarding basic skill levels related to IT, it is vital to fully leverage digital skills to improve productivity for employees in all Group departments, not just those involved in the IT solutions business. To raise the basic skill levels of each employee, since 2023, we have had approximately 14,000 employees take DX certification and DX business certification exams. Our goal is to have 1,000 employees with professional-level certifications, and as of the end of 2024, we already had 925 certified employees. We will continue to have all Group employees deepen their DX expertise to improve their ability to supply proposals that support customer DX implementation and to strengthen their ability to conceptualize new business models.

In the midst of the growing complexity and severity of social issues, we believe that diversity is an extremely important element of achieving sustainable growth. Instead of letting ourselves become trapped by preconceptions, we must generate more creative and innovative ideas by having people with diverse viewpoints and experience share their opinions. The conceptualization abilities—the unique ideas—that  would generate new businesses are the product of unfettered discussions by people with diverse backgrounds. Our Group Employee Engagement Survey found that scores for both “mutual respect for each otherʼs opinions” and “cooperative relationships” were nearly 800, out of a maximum score of 1,000. We believe that when employees with varied backgrounds and experiences freely share their opinions, this contributes to the creation of new ideas and employee job satisfaction.
I think that human resources strategies are ongoing endeavors. Synchronizing the skills needed to carry out duties with the abilities and intentions of individual employees is a perennial challenge. Striving to maximize the potential of each and every employee and to enable the company and our personnel to continue growing together. This is what I see as my own role.
In the Group’s annual employee evaluations, we evaluate employees based on their performance as well as their actions in comparison with the values and action guidelines. Last year, we reflected elements of the Purpose in these values and action guidelines, linking evaluations to words and actions that embody the Purpose. We will steadily refine our engagement improvement cycle as we make improvements on our past human capital initiatives, based on our cherished Code of Conduct and our corporate culture, which includes the values and action guidelines.