Nippon Signal:

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Established in 1928, Nippon Signal is a Japanese technology company offering solutions in transportation infrastructures and ICT (Information & Communications Technology). Building on its historical business in railway signal systems, the company has become an innovative leader in smart mobility and solutions for passenger safety and comfort. Nippon Signal Group employs around 3,000 people and recently launched a new business in DX (Digital Transformation), including initiatives for self-driving trains and cars, and the commercialization of humanoid robots for working at heights.

Improving operational processes ahead of core system renewal

Nippon Signal’s mission is to contribute to a safer and more comfortable society by providing superior technologies for safety and reliability. Many of the company’s core products and systems help protect human life while also promoting sustainability. These include rail and road signaling systems, as well as automated driving systems, LED traffic signals, station platform doors, and the world’s first automatic ticket gate capable of issuing delay certificates.

To pursue its ambitions, the company wanted to maximize support for its growing DX business and enable alignment with the UN’s Sustainable Development Goals (SDGs) and ESG principles. “We knew we could only achieve this by improving operational efficiency and business process excellence,” explains Susumu Osanai, Manager, Group IT Strategy Department, “but we couldn’t really identify which parts of the business needed our attention most.”

Optimizing business and systems with ARIS Process Mining

Adding to the company’s sense of urgency was the looming “2025 digital cliff”. This is the moment the Japanese government predicts the country will suffer economic decline if IT legacy systems are not modernized. To address this, the first step for Nippon Signal was to migrate the core system (from SAP ECC 6.0 to SAP ERP S/4 HANA) and improve target business operations. “ARIS Process Mining, from Software AG, was exactly the solution we needed,” Susumu Osanai explains. “We saw that it would allow us to visualize and analyze processes based on actual data and monitor them in real time to objectively identify points for process improvement, and then assess how successfully the improvement process was taking root.”

Software AG’s ARIS Process Mining is the leading commercial process mining solution on the market, because of its excellent operability, its capacity to quickly and automatically discover business issues with specific details, and its ability to analyze and manage data from multiple systems, including not only SAP but also Nippon Signal’s own proprietary systems. The company also appreciated the fact that ARIS Process Mining allows users to set up and conduct analyses in accordance with system modifications or decommissioning from any angle.

An initial POC provided an opportunity to explore the possibilities of ARIS Process Mining and assess its usability based on employee input. Susumu Osanai explains, “The SAP ERP system relates not only to financial accounting, but also to other areas of the business such as sales and purchasing, production management, inventory management, and project management. We found ARIS Process Mining was easy to operate and relatively straightforward to adapt from the default settings to our own complex architecture.”

Nippon Signal began by visualizing process flows based on real-time data, with the aim of identifying and predicting process bottlenecks, duplications of effort, and irregularities in expected user behavior. ARIS Process Mining was quick to analyze processes that the company’s Business Intelligence tool had failed to pick up. This allowed Nippon Signal to notice biases in the process patterns (process variants) of its current operations, identify those differences, and begin to make improvements.

Identifying improvement points and implementing countermeasures

The initial focus of process mining was the sales process. Using process mining and process analysis, Nippon Signal was able to visualize the number of processes and the processing time per department and per user.

Railway signals represent one of the company’s core activities and businesses, and the sales cycle and processing time is relatively long. The detailed analysis provided by ARIS Process Mining has helped to improve the process from deal planning to closing. It revealed that, while the initial stages from deal planning to order receipt take very little time and are processed quickly, the post-order process is often very lengthy.

“It’s so important to be able to adjust the granularity of the analysis as you want,” says Masafumi Mori, “because it allows you to dig deep into the data and get the explanations you need.” After discussions with teams, multiple factors were identified for order delays, including price negotiations, changing order dates and delivery locations. It was agreed that the sales department should be consulted to remove such bottlenecks in the future.

Another key feature of ARIS that proved invaluable is the compliance rule check. By setting a rule governing the maximum time for a process, ARIS can be used to continuously monitor improvements implemented by each business department—and then measure their progress. As the company pursues its ambitious targets in DX and automation, this could prove a crucial advantage.

Process mining opens the way to enterprise-wide digital excellence

Following the success of process mining for its sales system, Nippon Signal is set to use ARIS to get a better understanding of processes in areas such as purchasing and manufacturing. It plans to set hypotheses based on actual data accumulated in the core system, and to quantitatively measure the effects of streamlining strategies by comparing before and after. This will allow it to understand which measures have the most impact on the business.

This is a strong point of ARIS, which can be easily customized for different types of users.

In the next year, the company’s major focus is DX. It has already acquired certification as “DX ready” and is aiming to achieve “DX Excellent” ahead of its 100th anniversary in 2028. Projects in the pipeline include an IoT transport analysis system and the development of a humanoid robot to carry out maintenance work in high places where there is a risk of workers falling.

With Japan facing an ageing population and labor shortages, such initiatives could prove important for the national economy. And the company is planning to continue using ARIS for a clearer view of what is happening across its business, allowing it to continue driving operational excellence and fuel innovation.