[Book] Deciphering 'Employee Retention Techniques' from an HR Perspective: Concrete Measures to Turn AI Utilization into 'Ease of Work' - Lessons from Noboru Koyama's Book
The Surprising Correlation Between Generative AI and 'Employee Retention'
This book is a management guide by Noboru Koyama, President of Musashino Co., Ltd., which operates businesses such as Duskin, that fuses the use of the latest digital technology with organizational management. As the title suggests, it reveals, along with concrete practical examples, the mechanism of how the use of 'Generative AI' leads directly to 'building an organization where employees do not quit,' rather than just improving operational efficiency.
Generally, DX (Digital Transformation) and AI introduction are often discussed in the context of labor saving and cost reduction, but the author defines this as a 'tool for retaining people.' At Musashino, they maintain a high level of retention, with 91% of new graduates staying within three years and extremely few employees with 10 or more years of service leaving. Behind this is thorough AI utilization and a system for returning the funds generated by it to the employees.
By combining AI (Gemini), data analysis tools (Looker Studio), and RAG (Retrieval-Augmented Generation) that safely utilizes internal company data, employees are freed from simple tasks and productivity is improved. As a result, profits increase, and this is returned in the form of 'base salary increases.' It is argued that this virtuous cycle of 'AI utilization -> productivity improvement -> salary increase -> further AI utilization' is the key to increasing employee engagement and preventing turnover.
Psychological Safety and Business Reform Brought by AI
What is interesting about this book is the perspective that AI contributes to employees' mental health and ease of work. For example, in tasks where young employees are prone to feeling stress, such as handling complaints or creating complex routes, an environment is in place where AI immediately presents the 'correct answer' or 'optimal procedure.' This frees new employees from psychological burdens such as 'not knowing who to ask' or 'being afraid of being scolded,' allowing them to work with peace of mind.
As concrete examples, cases are introduced where the time for creating visit routes was shortened from half a day to a few minutes, the creation of apology letters for complaints, and the automatic generation of proposals based on past data. These are not just time-saving measures, but enable employees to devote time to 'creative work that humans should originally do' and 'face-to-face communication with customers.'
Also, as a major premise for AI utilization, the importance of 'organizing and tidying up' information, or 'environmental maintenance,' is emphasized. To make AI provide accurate answers, the internal data used for learning must be up-to-date and organized. The fact that physical office cleaning and tidying are linked to the maintenance of digital data, leading to the standardization of work and the elimination of reliance on specific individuals, is rich in practical implications.
Recruitment with a Defined 'Strike Zone' and Organizational Reform Tailored to the Young
While utilizing AI, unique theories are also developed regarding HR measures such as recruitment and placement. In recruitment, a 'strike zone' is set that prioritizes 'talent who can share values' over talent with excellent skills. Rather than academic background or grades, they emphasize past experiences of failure, consistency, and whether the candidate fits the company's culture.
Also, in an era of rapid change, the importance of the company changing to match the values of young people is explained. Modern young people seek flatness rather than hierarchical relationships, and the boundaries of interference in their private lives are also changing. By understanding such generational characteristics and incorporating mechanisms like team-based training and 'internal job transfers' that allow employees to experience different departments, they prevent mismatches after assignment.
In terms of organizational structure, they adopt a 'diamond-shaped organization' with a thick management layer (middle layer) rather than a general pyramid shape. This shortens the distance between superiors and subordinates, improves transparency, and creates a foundation where so-called 'office bosses' or specific power holders are less likely to emerge. Frequently rotating personnel and not allowing 'entanglements' in human relationships also contributes to creating a workplace with high psychological safety.
Communities Without 'Entanglements' and the Value of Analog Dialogue
The latter half of the book focuses on building a 'community without entanglements.' While promoting digitalization in the back office, Musashino's strength lies in the 'fusion of digital and analog,' where they thoroughly emphasize analog for human-to-human contact.
Specifically, they invest heavily in communication measures that may seem inefficient at first glance, such as encouraging small talk during environmental maintenance (cleaning activities) with all employees, frequent social gatherings, company trips, and the use of thank-you cards. These are not just to create a friendly club, but are positioned as 'part of the work' to facilitate reporting, communication, and consultation on the job and to remove psychological barriers.
In addition, systems that support employees' life stages and their lives themselves, such as long-term leave systems, flexible holiday work systems, and a 'return system' that actively accepts employees who have once resigned, are also in place. It is clear that the peace of mind of 'being able to return even if you quit' and the attitude of valuing employees including their families are, as a result, powerful retention factors. This book shows that the dual wheels of cutting-edge technology like AI and the gritty building of human relationships are indispensable in modern organizational management.
Considerations as Corporate HR
From here, I would like to organize how the contents of this book can be utilized from the perspective of corporate HR from several viewpoints.
Linking 'AI and Treatment' in Recruitment and Retention Strategies
First, I would like to focus on the point of "how to message the purpose of AI introduction within the company." In many companies, AI introduction tends to be discussed in the context of company convenience, such as "operational efficiency" or "cost reduction." However, following the examples in this book, it is considered an effective move for HR to clearly present a story that "the profits and time generated by AI utilization will be returned to employees in the form of compensation (salary) and ease of work."
Specifically, this includes linking DX promotion with HR systems and visualizing the funds obtained through productivity improvements in the form of base pay increases. As a result, for frontline employees, the perception of AI and new tools may change from "enemies that steal jobs" or "things that are troublesome to learn" to "allies that enrich our lives." In recruitment branding, the track record of "reduced overtime and increased salary through AI utilization" can also be a powerful selling point.
Furthermore, the perspective of AI utilization is also important in the onboarding of new employees. The difficulty of acquiring operational knowledge and the barrier of "not knowing who to ask" are major factors in early turnover. Creating an environment where internal regulations, manuals, and past trouble cases can be referenced via RAG (Retrieval-Augmented Generation) is one of the "retention support measures" that the HR department can lead. In addition to human support such as mentor systems, providing an environment for immediate responses via AI is thought to reduce the psychological burden on young employees.
Approaches to "Values-Based Hiring" and "Resolving Post-Joining Gaps"
Regarding the clarification of hiring criteria, the book's concept of a "strike zone" is also a useful reference. While skill-focused hiring can lead to expectations of immediate contribution, the perspective of cultural fit tends to be neglected. It may be necessary to re-articulate the company's "non-negotiable values" and "unacceptable behavioral traits," and go through a process of reaching a consensus among interviewers on these as hiring criteria (the strike zone).
Also, I would like to incorporate methods for "gap resolution" from the period after receiving a job offer to the post-joining assignment process. The "training that involves experiencing all departments" and "internal job transfers (job rotation)" mentioned in the book are effective measures to prevent mismatches, often referred to as "assignment gacha."
Of course, depending on the industry and scale, experiencing all departments may be difficult, but it is important to value the stance of providing opportunities to talk with senior employees from multiple departments before official assignment, or having HR firmly explain and educate on the "career value gained even if the assignment is not as desired." Presenting a career path where young employees feel that "this company allows for diverse experiences" is presumed to lead to long-term retention.
HR Measures to Promote Organizational "Metabolism" and "Circulation"
From the perspective of organizational revitalization, the approach to personnel transfers to avoid creating "entanglements" is highly suggestive. The point that long-term stays in the same department lead to personalization of tasks and the fixation of human relationships (such as the emergence of office politics) is something many organizations can likely relate to.
While the balance with specialist development needs to be considered, institutionalizing periodic rotation as an "opportunity for growth" in a positive way is an effective means to improve organizational transparency. Furthermore, by incorporating qualitative contributions such as "cooperation with other departments" or "thanks cards" into HR evaluations, it is possible to foster a culture that prevents the evils of siloed organizations and strengthens horizontal collaboration.
Furthermore, the stance toward those who leave the company is also a point to be reviewed. Welcoming "boomerang employees (alumni hiring)" as a system and clarifying the conditions is a rational recruitment strategy in today's world of high talent mobility. A relationship where you can send someone off at the time of resignation saying, "It's okay to come back," also provides current employees with a sense of security that the company is "broad-minded."
Finally, precisely because we are in the digital age, I would like to re-evaluate the value of "analog dialogue" emphasized in this book. While streamlining business communication with chat tools, we should consciously design time for face-to-face dialogue and casual conversation for emotional care and building trust. Perhaps HR is also required to play the role of protecting these "areas that should not be streamlined" and working with management and frontline managers to create spaces (such as environment improvements and opportunities for social interaction) that act as a lubricant for the organization.
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