Technology Development Strategy

The three core strategies used by the AGC Group to accelerate the pace of development, provide solutions to social issues, and create value are ambidextrous development, open innovation, and digital transformation (DX).

Long-term Management Strategy and Technology Development Strategy

The goal of the AGC Group’s long-term management strategy is expressed in Vision 2030: “By providing differentiated materials and solutions, AGC strives to help realize a sustainable society and become an excellent company that grows and evolves continuously.” Our strategy for moving forward steadily toward the realization of this vision is defined in our medium-term management plan, AGC plus-2023, which calls for the reinforcement of core businesses and the development of strategic businesses through ambidextrous management, combined with the promotion of sustainability management, and the enhancement of competitiveness through accelerated DX.

For these reasons, we are addressing key goals, including the reinforcement of our core businesses, the development strategic businesses, and contribution to the creation of a sustainable society, through strategies based on three central concepts: ambidextrous management, open innovation, and digital transformation (DX).

Ambidextrous Development

“Right-handed” development refers to (1) the innovation of existing production technologies and basic technologies, and (2) the development of new products together with our customers. Involving working closely with customers and catering to their needs, this type of development uses a forecasting approach in which current conditions are the starting point of projections and improvement measures. From a business perspective, “right-handed” development refers to the development of technologies that will strengthen existing businesses through productivity improvement and the creation of new products.

“Left-handed” development, by contrast, (3) is based on backcasting, which begins by anticipating future trends and then undertakes the initiatives and new business creation needed to adapt to these trends. In other words, the goal of left-handed development is to open up new markets by redefining existing production technologies and fundamental technologies. From a business perspective, it means the development of technologies that lead to the creation of new businesses in strategic areas, such as mobility, electronics, and life science.

Both types of development are important. The AGC Group aims to grow and evolve by using “right-handed” development to enhance the competitiveness of existing businesses, while building the future through “left-handed” development. Success will depend on our ability to pursue ambidextrous development by maintaining a balance between both approaches.

There are many obvious examples in the history of our glass business. “Right-handed” development resulted in the creation of sophisticated functional products, such as Low-E double-glazing glass, which we developed by combining our basic production technologies for architectural glass with other core technologies, including coating and composite know-how. This is equivalent to our current efforts to strengthen our existing core businesses. “Left-handed” development led to the extension of flat glass technology to create automotive glass and CRT tube glass for use in emerging business areas, such as automobiles and televisions. This is equivalent to the creation of new strategic businesses through “left-handed” development.

Ambidextrous approach to glass businesses

We can also find examples of these approaches in the biopharmaceutical CDMO business area. AGC had previously developed fluorochemical technologies for intermediates and active ingredients used in low-molecular-weight pharmaceuticals and agrochemicals and had also established quality control systems and facilities at the Good Manufacturing Practice (GMP) level in these business areas. We had also developed and possessed biotechnology to produce useful proteins using yeast and E. coli. The use of our organizational resources and technologies to establish a CDMO business using bio-organisms to produce biopharmaceuticals under contract from Pharmaceutical manufacturers is typical of the “left-handed” development approach, since it has resulted in the creation of a new strategic business in the life science field. This was the starting point for our expansion into the field of antibody pharmaceuticals through the development and introduction of mammalian cell technologies, including the use of M&A. This is another example of “right-handed” development in the sense that it resulted in the enhancement of existing businesses.

Ambidextrous approach to biotech CDMO businesses

Open Innovation

Social issues have become increasingly complex in recent years due to the accelerating pace of social change. Customer needs are also becoming more sophisticated and diverse, leading to the emergence of issues that AGC cannot solve solely through its own development efforts. This is reflected in the growing importance of open innovation as the basis for collaboration with external partners.

AGC approaches open innovation along two axes. The first is collaboration with universities, other academic institutions, and startups. The aim of these partnerships is to develop innovative technologies and technologies outside of AGC’s fields of expertise. We are tackling a range of complex issues in partnership with various institutions, including the University of Tokyo, the Tokyo Institute of Technology, and Nagoya University.

Our second axis for open innovation is the use of new technologies and solutions resulting from collaboration initiatives to develop new products in partnership with leading companies in our customer base. A recent example is our joint development initiative with NTT DOCOMO, INC., a major telecommunications carrier. Finding locations in cities where mobile communication antennas can be installed is becoming difficult. In response, we have been partnering with the telecommunications carrier to develop WAVEATTOCH, a glass antenna that can be installed from the interior side of existing window glass, thereby converting the windows of downtown buildings into antennas.

In 2020, we established a new research scheme within the AGC Yokohama Technical Center (YTC). This allowed us to create a seamless structure encompassing all stages from the development of materials and processes through to the development of equipment technologies, by bringing together development functions that had previously been based at two separate locations. The new research scheme also includes the AGC Open Square (AO), which we established to provide a space for collaboration and accelerated open innovation with external partners. The concepts for the AO space are “connect”, “create”, and “materialize”.

Digital Transformation (DX)

There is intense interest in materials informatics (MI), which can dramatically improve the efficiency of materials development through the application of computational and data science to the development of new materials and compositions. AGC was one of the first manufacturers to introduce MI, which we have used to develop new types of glass, the environment-friendly fluorinated solvent AMOLEA, and various other products. However, it has previously been difficult to make extensive use of MI in wide-ranging fields because of issues that included the lack of standardized storage formats for experimental data. AGC addressed the need for an integrated experimental data storage platform, which we saw as essential infrastructure for the use of MI, by developing MI data base systems, including the AGC R&D Data Input & Storage (ARDIS) system, which incorporates an electronic laboratory notebook function for use in development activities, and the AGC Materials Informatics Basis Analysis Tool (AMIBA).

This work has opened the way for the development of materials by linking MI with experiments and theoretical computation through the use of software developed in-house to support computational science, including quantum calculations and molecular simulations.

AGC has created an integrated development environment encompassing all stages from data entry to data analysis to support development activities in fields ranging from glass and chemicals to biotechnology. This environment is enhancing our understanding of phenomena and properties at all development stages and accelerating improvements in the efficiency of our R&D activities.

Solutions for a Sustainable Society

Glass manufacturing is a major consumer of energy because of its reliance on burners to melt the sand used to produce glass. As a leader in the glass industry, AGC is helping to maintain global sustainability by working toward the goal of achieving net-zero emission status by 2050. We have already completed 93% of our fuel conversion to natural gas, which emits approximately 20% less CO2 than heavy oil during combustion. We will continue to work toward our goal of net-zero emissions by developing advanced industrial technologies, such as CO2-free ammonia combustion technology, the use of electrical boosters to melt sand, and the development of ceramics with enhanced thermal insulation properties.

We will also continue to contribute to the reduction of GHG emissions through our business activities. We are developing a wide variety of environment-friendly products, including vacuum insulated glass, and solar power cells integrated into construction materials. In Europe, the reduction in CO2 emissions through the use of our architectural glass is equivalent to 10 times the amount emitted when the glass is manufactured.

Another important priority for AGC is the development of materials that contribute to the use of hydrogen energy as a carbon-free energy source. Our fluorine-based electrolyte polymers for fuel cells are by far the leading products in this market and are contributing to the realization of a hydrogen-based society thanks to their combination of high power generation performance and superb durability.