Benesse's corporate philosophy is aimed at “helping each person to live well,” and our business focuses on developing products and services that the company and its employees would be happy to use themselves, or provide to their own families. Employees therefore play a crucial role in determining the issues and problems that customers might face, and finding ways to address them. To do this job effectively, it is important that employees have a broad awareness of the society and local lifestyle of customers; they should have extensive experience in their local communities which will help them to understand what “living well” implies, to people in various settings and circumstances. Benesse does not have any large production facilities or some special technology on which to build our business operations. For us, the most important assets are the intellect and inspiration of our employees. We strive to make the optimal use of each employee, regardless of their gender, age, nationality or living conditions, and we believe that the best way to ensure growth for Benesse is by supporting the personal growth of each employee, which will allow them to provide more value to Benesse customers.

The current personnel structure was introduced in 1995. The basic concept that underlies it is the idea that the personal growth of each employee contributes to the organizational growth of the company. Therefore we try to promote individual freedom with personal responsibility, in order to encourage each employee's initiative. The compensation structure is based on job responsibilities and accomplishments; we have eliminated any consideration of seniority or age, and introduced a structure in which rewards are based entirely on performance. This personnel system seeks to determine the commitment of each employee and evaluate them based solely on quantitative measures, and we think it has produced results in terms of reviving Benesse's earnings. However, we do notice that the focus on short-term numerical targets and the pressure for each individual to produce results is promoting a sort of “standardization” of the contributions that each individual makes. There is a danger that this could inhibit the longer-term growth and advancement of individual employees, or detract from successes that can only be achieved through group efforts. We view these as potential problems that we need to address.

Kimiko Kunimasa, CHO and Executive Officer, Director of General Affairs & Human Capital Department

In fiscal 2007 we began work to plan revisions to the basic structure of Benesse's personnel system. We aim to establish a system that will allow each employee to make the best use of their individual strengths and capabilities over the long term, by combining the current system of short-term objectives for each individual with measures that encourage and reward longer-term growth and team successes. In this way, Benesse hopes to perpetuate business growth. To accomplish this aim, we need to find ways to provide each person with opportunities to demonstrate their individual talents and support their efforts to improve themselves over the longer term, enhance on-the-job training activities, introduce systems of compensation that reward the achievement of broad objectives, and create a working environment in which employees can remain healthy and energetic in their jobs over the long term. We are currently in the process of carefully designing plans that address each of these themes, and are seeking feedback from employees throughout this process. We intend to introduce a new personnel system in fiscal 2009. However, the most important factor in effectively implementing a new system is to make sure that it is clearly understood and can be rolled out smoothly. Therefore, during fiscal 2008 we are setting the stage, making sure that all employees understand and accept the new system, and trying to promote clear communication at all levels. Top management is holding meetings to thoroughly discuss the issues and exchange their views, while communicating with department heads and section heads to explain the basic policy of the new system, ensure that it is understood, and allow the program to be implemented smoothly. At the risk of repeating myself, I want to emphasize that employees are Benesse's most important assets, and the task of the personnel department is to ensure that each one of them are able to “live well,” and thus they can work effectively to help Benesse customers “live well.”