President & CEO
The Group’s Operating Environment
A variety of social issues are emerging and increasing in complexity. These include the normalization of natural disasters precipitated by climate change, such as the major hurricanes that struck North America last year; geopolitical risks stemming from instability; human rights; growing disparity among regions; and the evolution of digital technology. Japan, our home market, is facing a population decline and the rapid aging of its society. Globally, meanwhile, international society is seeing a widening of the scope of its shared tasks, such as the SDGs that the United Nations has established. The annual meeting of the World Economic Forum, often called the Davos Forum, which I attend ever year, discusses solutions to such tasks. This year’s discussion was themed on “Creating a Shared Future in a Fractured World.” Addressing social issues through individual bodies is no longer practical. Governments, companies, and nonprofit organizations must address issues by transcending existing boundaries and involving and coexisting with new organizations.
In this environment, significant threats to the Group not only include population declines and climate change but also disruption of existing markets caused by digital transformation. For example, in the P&C insurance business demand for automobile insurance could decrease with the spread of self-driving cars. Also, forays into the insurance industry by ICT-based companies could disrupt it dramatically. Thus, society is in an era of volatility, uncertainty, complexity, and ambiguity, and I believe that the Group’s operating environment will change significantly.
The Group’s Vision
To win out in such an era, the Sompo Holdings Group will move beyond the confines of its mainstay insurance business and transform into a unique, progressive “theme park for the security, health, and wellbeing of customers” that can “contribute to the security, health, and wellbeing of customers by providing insurance and related services of the highest quality possible.”
Stakeholders sometimes ask about the concept behind the vision referred to by a “theme park for the security, health, and wellbeing of customers.” I would explain as follow. Basically, the Group’s mainstay insurance business allows customers to prepare for emergencies. Under the “theme park for the security, health, and wellbeing of customers” vision, however, our goal is not only to mitigate the effects of accidents or illnesses but also to help customers sustain their present happiness and, if possible, make them even happier. In other words, we will maintain or make a positive contribution to customers’ quality of life. Theme parks are places for having fun, being happy, and directly experiencing such things as rides and snacks. In a similar way, we want to give customers a tangible sense of security, health, and wellbeing through the products and services that we provide. For example, requiring nursing care is never a welcome development for a person or his or her family. However, we want to help ensure that, if nursing care is required, customers know that there are reliable places to which they can entrust the care of their loved ones and where these family members can live happily. This is the sense in which we use the phrase “theme park.”
Transformation into “Theme Park for the Security, Health, and Wellbeing of Customers”
Transformation and Ecosystems
What does transformation mean for the Sompo Holdings Group? It does not simply entail increasing scale, becoming robust, or revamping the organization. Transformation means achieving qualitative evolution. Accordingly, we will revolutionize our businesses by creating business models that depart from the past completely. While optimizing digital technologies, capital, and other management resources, the Group will reform its entire business portfolio. Rather than just focusing on collaborations among existing frameworks or Group organizations, we will build ecosystems that link us to external partners with outstanding expertise and potential. By influencing each other and heightening our capabilities as a whole, we will become a “theme park for the security, health, and wellbeing of customers.” This will be the Group’s qualitative evolution, or transformation.
Indispensable elements for Transformation: Digital Technology × Personnel
We need two elements to realize transformation—digital technology and personnel. To convert the impending digital transformation and disruption into an opportunity, we have to grasp trends in the world of digital technology more quickly and take action beyond existing frameworks and business models. With this in mind, we have established SOMPO Digital Lab in Tokyo and Silicon Valley, the United States. We have also established a lab in Israel, which is in the vanguard of technology development. SOMPO Digital Lab is advancing a range of leading-edge initiatives, such as developing digital technology applications for existing businesses and venturing into the cybersecurity business.
While extremely important, being well informed about the latest technologies is in itself not enough to bring about transformation. In the digital era, personnel are the most significant and the ultimate differentiating factor. No matter how far AI or robotics progress, they will never be able to empathize or make decisions about complex, unresolvable problems while taking into account broad perspectives. To put it another way, I think that the roles of personnel will become even more important in the digital era. Emotional intelligence will be the main attribute, and personnel with well-developed emotional intelligence will be the key drivers of the digital era. Therefore, we will foster many emotionally intelligent personnel while diversifying our workforce by developing or hiring personnel with professional competence or rare talents. These personnel will drive our transformation.
I believe that our initiatives in this regard will create new value, enable us to see social issues as opportunities, enhance long-term corporate value, and help realize a sustainable society.
Based on dialogues and partnerships with all stakeholders as well as an unshakable commitment to the vision of a “theme park for the security, health, and wellbeing of customers,” the Group will unite and move forward to achieve transformation.
As we take on this challenge, we would like to ask all of our stakeholders for their continued support.