With its operations spanning four business segments (Infrastructure Maintenance, Management, and Renovation; Natural Disaster Prevention and Mitigation; Environment; and Natural Resources and Energy), Oyo is playing a vital role in Japan’s infrastructure revitalization thanks to its state-of-the-art technologies. Pioneering digitalization in the industry, Oyo boasts one of the largest databases on underground data and geology-related surveys in the world, and aims to digitize this information to make it available in an open ICT platform accessible to other companies and industries. We speak with president, Masaru Narita, to learn more about Oyo’s operations and technology.
Japanese corporations have been facing stiff price competition from regional peers located in countries with a cheaper labour force. How can corporations such as OYO differentiate themselves?
The reason that Japanese corporations have been unable to compete on pricing with their Korean or Chinese counterparts is because of differences in the mindset towards civil engineering. Japanese construction companies, including ours, believe they have a social responsibility when building infrastructure; this means that our projects must be durable and that they must stand the test of time. This philosophy is applied to all our construction projects. In contrast, overseas companies have traditionally focused on acquiring the contract at the initial stages of planning by offering their services at a much cheaper price. This difference in mindset explains the disparity in pricing, and companies such as ours often face difficulties in conveying the long-term value that can be gained from our services. In the long term, we are confident that our projects provide greater added-value and require less repair and maintenance; ultimately becoming more cost-effective and beneficial to our clients in the long term.
Another issue Japanese companies have faced is the tendency to ‘categorise ourselves.’ By labelling our activities, we sometimes send a too-narrow image of our work and our stakeholders wrongly assume that our field of expertise is limited. For example, our company may wrongly be perceived as a construction-related company that only engages in construction-related business, but in reality, our company is actually a geologist survey-based corporation. This is understood domestically, but overseas, it is less clearly understood. Therefore, we must endeavour to explain who we are and what we have to offer through the four segmented business lines we have created, namely: Infrastructure Maintenance, Management, and Renovation; Natural Disaster Prevention and Mitigation; Environment; and Natural Resources and Energy. By using this segmentation, we can match the needs of our foreign clients and demonstrate the full extent of our capabilities and of our expertise. We have had to make our activities more communicable to foreign stakeholders so that they can clearly understand who we are and what we can do. With Japan’s shrinking population and ageing society, accurately communicating the capabilities of OYO CORPORATION will become increasingly important as the number of domestic clients decline. As a result, the number of tasks our clients expect us to execute is now significantly greater than it was in the past. As a consulting firm, one of our strengths is our ability to analyse seismic actions and to predict how much waste will result from natural disasters. That being said, we can do so much more than that. The related services we offer therefore provide a more accurate vision as to OYO’s fields of expertise.
Japan’s infrastructure boom occurred more than 50 years ago and nowadays many construction projects are ageing. Furthermore, Japan also needs to address certain social issues related to its ageing population which will require new social infrastructure. Looking at the future, what major infrastructural changes do you expect Japan to develop and how is OYO CORPORATION contributing to this civil engineering transformation?
Regarding the ageing needs of Japanese infrastructure, our major focus is placed on maintenance. We have been developing devices for geologist surveys and other related-machinery in order to facilitate maintenance and repair. When maintaining buildings and civil infrastructure, understanding the ground underearth is of paramount importance. Otherwise, you are left with unstable foundations that are vulnerable, which could lead to a collapse. Our presence and geological expertise are critical when it comes to the maintenance of infrastructure.
With regards to the ageing labour force, we must make our work more efficient by adopting new technologies. For example, we have developed an i-SENSOR device that can replace manpower. Through this process of digitalization, we are making our work more efficient. We are taking an efficiency-based approach to try and create an environment where we can conduct our work more efficiently through the use of innovative technology. Under this new technique, we analyse certain situations through digital technology, and we then create a new device that can communicate the relevant information to the people in charge. This form of remote control makes it easier for local authorities to evacuate populations in the event of a natural disaster. Since the beginning of this year, we have seen our efforts bearing fruit in this respect. Using our electromagnetic sensors to make a 3D map of the utilities located under roads, we are acquiring an array of data that we sell to various clients. This project is developing in collaboration with Hitachi.
Oyo’s three-dimensional visualization of geological risk for a tunnel construction site
In Japan and abroad, the construction industry has been criticized for its slow adoption of digital technologies. However, OYO corporation has developed a number of innovative techniques, such as your three-dimensional geological analysis system, the GEO-CRE. Can you tell us more about this product and how your company plans to become a leader in 3D ground information technology?
The continuous development of new technologies is high in our list of priorities. Our company’s underground surveys are the perfect example of how we are leveraging Industry 4.0 technologies. For example, after our sub-road cavity survey is conducted, we use AI technology to analyse 3D mapping data. Thanks to this method, we can analyse a 1km parcel of ground in ten minutes in case of the fastest. By contrast, using a human person would take entire days of work; so our method has become extremely efficient. Based on the data analysis conducted, we, Hitachi and OYO, map the area analysed in a 3D format and send the analysis to the cloud, where it becomes accessible worldwide. At OYO, we are trying to automatize the traditionally manual-based methods we had to rely on previously. We are taking this step-by-step approach in order to fully adapt to the demands of Society 5.0.
OYO’s 3D analysis of underground utilities utilizing AI technology
Our company has one of the largest databases of underground data and geology-related surveys in the world. What we are presently doing is digitalizing this information into an ICT (Information and Communications Technology) platform. This has been a three-year project which we will finalize shortly. Our goal is to make this project an open platform that other industries can have access to and use. We see this data-based line as another means by which to conduct our business in the future. As the world of construction moves towards BIM (Building Information Modelling) workflows, displaying underground data in a 3D format is becoming a necessity. When the information was displayed in two dimensions, only experts could understand the data. By switching to 3D modelling, we allow non-experts to understand the survey data, thereby making the whole process so much more efficient. We are also working with the bSI (building SMART International) to create a new international standard so that our technologies in the field of underground surveys can be recognized globally. Our technology has been developed from surveys conducted in Japan, one of the most complex geological regions in the world. Japan’s geological environment is extremely intricate and complex due to the interaction of plate tectonics. Beginning our project in such a complex environment has forced us to develop cutting-edge technologies. While at first a challenge, developing geotechnical technologies in such a complicated environment has become one of our competitive advantages; and we believe that we can export our expertise to overseas markets.
Can you tell us more about the projects you have exported successfully to overseas markets?
To meet the global needs of disaster prevention, we must first clarify and explain what we can do. We have been working with Azerbaijan on their disaster prevention strategy and processes, and we have come to understand that there are a lot of landslide-based disasters in Eastern Europe. After conducting research and analysis, we are convinced that our know-how could add great value to their disaster prevention efforts. At first, our expertise could allow us to foresee and predict the stages, timing and location of natural disasters. In a second time, the sensors we are developing would be able to instantly receive disaster-related information and then automatically transfer the relevant warning to the authorities and civilians concerned.
OYO CORPORATION established its first oversea subsidiary in Houston, Texas in 1980. Since then, you have expanded to other locations including Singapore, the UK and France. Can you tell us more about the benefits of this integrated international approach? What areas you will be looking to expand further to in the future?
Our international approach is simple: we expand to wherever there is an opportunity. Currently, we have group companies in the US, the UK and Singapore, and we own shares in a French company. In the past, we adopted a purchased-based approach and concluded M&As with companies that had device manufacturing abilities for seismic-waves and ground radar penetrating technologies. GSSI Inc., is an example of such companies. Today, we are focused on expanding our services and activities in the fields of maintenance. As such, we acquired a Singaporean company as a subsidiary in 2019. Our aim is to use their network to expand our business in Asian countries. M&A is one of the pillars of our expansion strategy.
2020 marked the last year of the “Long-Term Management Vision (OYO 2020) and Medium-Term Business Plan (OYO Jump 18).” Part of that strategy was to establish the OYO brand in the four business segments. Looking at the future can you run us through your next medium-term business plan and what are the key targets you will be looking to achieve?
The OYO Jump 18 was the last medium-term business plan under the OYO 2020. Unfortunately, we were not able to reach our numerical targets due to the COVID-19 pandemic. However, we were successful in establishing the four pillars of our business. We also developed technologies to transfer 2D data into a 3D format, and we were able to digitalize all this information. What is important moving forward is to keep going and achieve the numerical goals that we will set in the new medium-term business plan.
In the past, we focused our efforts on developing our Monozukuri (manufacturing) skills. Previously, the manufacturing of devices for seismic measurements and ground survey-based technologies represented 15% of our income. This business line has since come to a halt because the technology required became too advanced. Today, modern seismic detection devices can automatically and instantaneously capture, analyse and change seismic waves from a numerical form to a digital one so that it can be observed instantly. In the past, conventional devices used to detect every wave-component, including the wavelength, but just selling those devices is not competitive in the current market. Our objective moving forward is to shift from a device seller to a provider of data-based services. While this transformation has been slowed by COVID-19, we will continue to promote our data-based services to the outside world. This will form part of our medium-term business plan from 2021 onwards.
OYO CORPORATION has been involved in major projects, such as the Tokyo Bay Aqualine or the construction of Kansai Airport. Looking back, what project are you most proud about?
There are so many projects to choose from! If I was to pick one, I would highlight our contribution to the aftermath of the Great East Japan Earthquake. How we dealt with this unique situation of unprecedented scope is something we are all extremely proud of. While we conducted a variety of activities, our operations in disaster waste management were particularly successful and critical. The garbage treatment system we put in place, by introducing a recycling view, allowed us to deduce the amount of waste to be processed. After the earthquake, we established a local station for five years that helped restructure earthquake-affected areas.
Some of our employees even went to the power plants to help secure and stabilize them. There are so many contributions made by individuals from OYO CORPORATION. This situation was particularly significant for us because it demonstrated how important and how committed our employees were. After those contributions, we put a particular emphasis on creating a comfortable work environment for our employees. We were proud to see that members of OYO CORPORATION felt it was their mission to help seismic affected areas.
As a company, we believe that coexisting with nature and living in harmony with the environment are of crucial importance. To achieve harmony, we must understand how nature works and we must develop the technologies necessary to live a “smarter” life. Through the efforts of our employees, we are making this goal a reality.