**4. A case of new mass customization and personalization in the sake industry: Sekiya Brewery Co., Ltd.**

#### **4.1. Characteristics**

Sekiya was founded in 1864 in the southeast prefecture of Aichi in Japan. Since then, Sekiya has been manufacturing high-quality sake using both traditional Japanese skills and advanced techniques. Sekiya has 53 employees and 1.7 billion yen of sales in 2016 (**Figure 5**); it is a middleranking company among Japan's sake breweries.

The goal of the company is to brew high-quality sake that explores the possibility of sake flexibly. Their brewery is actively implementing new technology and does not have the atmosphere

**Figure 5.** Sales of Sekiya.

**Figure 3.** Market share of sake in Japan in 2016.

**Figure 1.** Amount of sake production in Japan.

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**Figure 2.** Amount of specific classes.

of a traditional brewery. They decided to mechanize both so they could proactively rationalize the process that requires high labor costs and so they could closely monitor the details that need a great deal of work to pass down traditional sake-brewing skills to future generations. They devoted continuous efforts to controlling the machines as tools for the brewers and collecting elaborate amounts of data to utilize in future brewing (**Figures 6** and **7**).

#### **4.2. The process of manufacturing sake**

**Table 2** shows Sekiya's process of manufacturing sake. Sekiya thinks that one of the most important steps in sake brewing is "grand design." This concept does not refer to the usual designs of manufacturing products, but instead to designing all the components that are required to explain the product's concept and ideal taste to customers. Sekiya assumes a scene in which customers consume its products and decides what kind of rice to use, how much to shave the outside of the rice, what kind of yeast and koji to choose, and how to ferment. These processes are included in the concept of "grand design."

**Figure 7.** Various Sekiya products.

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**Table 2.** Manufacturing process of sake in Sekiya.

#### **4.3. Digital transformation and mechanization in the sake-brewing process**

Sekiya divides its brewing processes into two types. One is the process that should be carried out by employees, and the other is the process that utilizes mechanization for higher quality. For example, Sekiya mechanized the transportation process to reduce heavy labor and make it easy for women and the elderly to work.

By digitizing and automatizing procedures such as temperature control, it became possible to manufacture products without requiring employees to work all night. As described in the next section, this technological improvement has had a substantial impact on the company.

By mixing handwork and digitalization, Sekiya created a sake-brewing process that is not affected by external conditions such as temperature and humidity. The company also learned to control the quality of its products with diversified raw material rice. Moreover, various data related to each process accumulate through mechanization, leading to the standard products being of stable quality.

**Figure 6.** Sekiya Brewery Co., Ltd.

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#### **Figure 7.** Various Sekiya products.

of a traditional brewery. They decided to mechanize both so they could proactively rationalize the process that requires high labor costs and so they could closely monitor the details that need a great deal of work to pass down traditional sake-brewing skills to future generations. They devoted continuous efforts to controlling the machines as tools for the brewers and col-

**Table 2** shows Sekiya's process of manufacturing sake. Sekiya thinks that one of the most important steps in sake brewing is "grand design." This concept does not refer to the usual designs of manufacturing products, but instead to designing all the components that are required to explain the product's concept and ideal taste to customers. Sekiya assumes a scene in which customers consume its products and decides what kind of rice to use, how much to shave the outside of the rice, what kind of yeast and koji to choose, and how to ferment. These

Sekiya divides its brewing processes into two types. One is the process that should be carried out by employees, and the other is the process that utilizes mechanization for higher quality. For example, Sekiya mechanized the transportation process to reduce heavy labor and make

By digitizing and automatizing procedures such as temperature control, it became possible to manufacture products without requiring employees to work all night. As described in the next section, this technological improvement has had a substantial impact on the company.

By mixing handwork and digitalization, Sekiya created a sake-brewing process that is not affected by external conditions such as temperature and humidity. The company also learned to control the quality of its products with diversified raw material rice. Moreover, various data related to each process accumulate through mechanization, leading to the standard

lecting elaborate amounts of data to utilize in future brewing (**Figures 6** and **7**).

**4.3. Digital transformation and mechanization in the sake-brewing process**

**4.2. The process of manufacturing sake**

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it easy for women and the elderly to work.

products being of stable quality.

**Figure 6.** Sekiya Brewery Co., Ltd.

processes are included in the concept of "grand design."


Sekiya used to brew sake that relied on an external Toji like any other sake brewery. Most Toji were so-called migrant laborers. They made rice in the summer and worked at sake breweries in the winter. Considering the period necessary for making rice, external Toji could stay at a sake brewery from December to March. Sekiya hired Toji from Niigata, a site of mass rice production. However, Sekiya faced a difficult situation, in that migrant Toji from Niigata markedly decreased after 1993 because of aging. Inevitably, Sekiya switched to brewing sake by employees, and Sekiya was the first company to make sake without external Toji in the Aichi prefecture.

**5. Discussion**

and tastes.

skilled handcrafts.

**5.1. The impact of mass customization on sake breweries**

high-quality and stable production from experienced professionals.

**5.2. Theoretical review on the transition of manufacturing processes**

tory, they have not been readily able to catch up.

valid information for the smart system.

According to the case study of Sekiya, the key factor in the success of the custom-made system over those of other sake manufacturing companies is the continuous challenge of digitalizing and transferring professional techniques and skills. Recently, many other sake breweries have attempted to transfer their technics and skills from Toji to employees and failed because they focused on transferring implicit knowledge and techniques without digitalizing and improving the manual tasks. In contrast, digitalization alone is not enough to create a major impact on their business because companies have to understand what kind of data is important for

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Sekiya has faced the two challenges for a long time and succeeded. In this traditional and extremely old industry, it is incredible to receive more than 230 orders per year from original sake-brewing groups. Therefore, although other sake breweries have mimicked Sekiya's his-

In addition, Sekiya has tried to strengthen the relations with consumers to achieve the smart manufacturing and customization. In 2013, they opened up a directly managed restaurant, "Sake Bar Marutani," in the center of Nagoya which is the third largest economy in Japan. Marutani is the oldest business name of Sekiya, and they used 150-year-old storehouse as the restaurant. This restaurant has four important managerial factors: (1) introducing how to drink traditional sakes and enjoy differences such as glasses and seasons, (2) promoting communications between employees (technicians) in the factories and consumers, (3) conducting test marketing for new products and new lineups, and (4) investigating the trend of foods

These factors are all aimed to intensify the connection with end users. By obtaining the feedbacks from end users for years, Sekiya has built a capability to determine which information is important (and which is *NOT* important) for the development of smart manufacturing and customization. Avoiding unnecessary information is also important as much as to acquire

Hu [21] illustrated the evolution of the manufacturing paradigms in **Figure 8** using a volumevariety relationship. As noted in Section 2, the first paradigm in manufacturing is described as craft production. These manufacturing processes were driven by professionals with highly

Mass production began in Michigan with the introduction of the Henry Ford moving assembly line, which was built in 1913 and reached its peak after the end of the World War II, when demands for products became very high [21]. Next, Toyota invented a new manufacturing

When introducing the brewing system by employees without external Toji, the problem of techniques and skill transfer of high-skilled professionals is often raised. Sekiya was no exception to this problem and had modified this system for three generations. Advancing digitalization attracts a strong impression that machines substitute for the work that laborers do by hand, but what really matters is something else. Laborers, particularly experienced craftsmen, have sharpened senses. It is necessary to install sensitive information into the machine to optimize the next process. This is why computerization of sake brewing through mechanization was a difficult challenge. However, Sekiya has tried for years and achieved the ability to make sake of high and more stable quality.

Furthermore, the great advantage of digitalization and mechanization was a new brewing system for making sake three times a year. As mentioned above, the usual brewing period allows sake to be made only once a year, from December to March. Sekiya does three rounds of sake brewing within 10 months, except in July and August, when it performs maintenance on its machines.

Another achievement that should be noticed with the introduction of digitization is improvement of the labor environment. Sekiya employees go to work at 8 AM and leave before 6 PM. Therefore, unlike in ordinary sake brewing (especially among Toji), there are essentially no night shifts.

#### **4.4. Introduction of custom-made system**

Sekiya started an original sake brewery with a custom-made system. Very few sake breweries have a custom-made system. Sekiya's second factory, Ginjo factory, was built for the system in 2004. The Ginjo factory's capacity is only one-tenth that of the main factory. In the main factory, 12,000 l of sake are made in one lot. The Ginjo factory originally aimed at making small quantities of many varieties. A small tank serving as a single unit uses 60 kg of rice and produces approximately 100 l of sake. Sekiya receives a wide range of orders from individual consumers, companies, organizations, and restaurants in units of 720 ml × 100 bottles.

At the beginning of this project, there were very few orders. However, the custom-made system has gradually expanded into the market, and the current number of orders is approximately 220–230 tanks annually. Major customers are brides and grooms and their families, companies, and individual groups who want to celebrate their memorial anniversaries. These customers can send their original sake to someone as an expression of gratefulness and celebration. Customers can select a favorite container, label, and box.
