CSR
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A Business Designer’s View

Part IV: What should companies focus on now?

Dentsu Business Design Square was set up as a specialist unit at Dentsu’s head office in Japan. Its task is to help client companies develop a strategy that will allow them to attain a desired outcome through innovation.

In this series of articles, members of the specialist unit will explain what the term business design means at Dentsu. In the fourth installment of the series, team member and business designer Shingo Yamahara discusses how companies need to respond to game changers arising in today’s market.

Adapting to market game changers

The challenges currently facing corporate management are changing dramatically.

Besides advancements in digital technology, all-new services are being created nearly every day, while consumers’ experiences and preferences are shifting at an increasingly rapid pace.

Further, novel types of businesses and venture firms are entering the market, intensifying competition.

The challenge for corporate management is, thus, how to foresee future change and respond quickly.

In my experience, an increasing number of companies sense the risks they face and are devising appropriate plans, such as shifting from products to services, creating platforms instead of one-off product releases, and are seeking unconventional solutions rather than continuing with past measures for making improvements.

Nevertheless, all too often these initiatives come up against various obstacles. These include how to create new output and make inroads in a market without having had prior success; what sequence of actions should follow; and how to generate synergies with already established businesses. Devising plans that address those issues has been challenging for many company management teams.

Dentsu Business Design Square can offer solutions to such challenges and support until the solutions are realized. Below I explain some of the ways we conceptualize and understand our approach.

Creating new businesses from within a company

To devise solutions, we grapple with the challenges facing management in a variety of ways. But in this article I would like to focus on one of the ways: creating a new business from within a company.

1. Design a detailed business vision

Before a company can grow in a new direction, its management must have a clear vision of what the company should be.

For example, we can imagine that an automaker hoping to evolve into a comprehensive mobility service business might launch a ride share service.

Deciding on steps like that is extremely important. To formulate a vision, Dentsu Business Design Square creates detailed plans using “visioneering,” a method explained by Akihito Kunimi in the first article of this series, “Creating a Future that Serves Us Well.”

2. Uncover latent consumer needs

In most cases, when trying to launch a new service, a company will find itself up against established market players. It will also need to consider the scale of market entry and price competition. Whether room to enter remains in a market is another concern.

Nonetheless, one should bear in mind that consumers tend to unconsciously lower their expectations of products and services, before eventually giving up on finding what they want. So, one might consider how to identify such dormant needs.

Our approach is to exhaustively examine information on consumers in order to uncover fresh possibilities.

3. Generate ideas from a company’s assets

New business ideas can be drawn from a company’s tangible and intangible assets. These include technologies held by its R&D section. Certain of these may be able to greatly transform how the company offers products and services, or bring major changes if combined with assets of other companies. In fact, the new products and services we offer are generally the result of collaboration among Dentsu Group clients.

4. Take on substantive issues

It is important to understand how substantive issues confronting a company can be resolved by introducing new business ideas.

Since tackling the source of a company’s problems is not easy, we take an indirect approach by trying to change the business processes and organizational structure. And it is only through new business ideas that we can initiate innovations that previously were not possible in established businesses. In fact, we treat new business concepts as prototypes for company reform.

While going back and forth between designing a detailed vision for a company’s business, uncovering latent consumer needs, generating ideas from a company’s assets, and taking on substantive issues、it is through these four perspectives that we explore the middle ground and create ideas that offer new value.

Far from being simple, this process involves repeatedly debating concepts and seeing their development through to the end. It is important to organize planning sessions, so that all members of a team can enjoy creating ideas and get excited about them. After all, if the team does not enjoy the process, how can it create new value that consumers want to experience?

A company’s value chain

Products and services are not the only things designed by Dentsu Business Design Square. We also create ways for human resources and organizations to become platforms for achieving growth.

With that in mind, we examine a client’s existing operational processes and try to resolve whatever problems are uncovered. The approach we take is often based on the company’s value chain.

We outline the process through which improvements were made in the past, and recommend tasks for each company division. We also critically assess other divisions, make requests and point to problems, such as any lack of cooperation between divisions.

After numerous sessions with the client, we usually discover that the value chain has hidden fractures. These are generally related to conflicting mindsets of different divisions, staff relationships, or organizational problems.

For instance, a company might have many meetings involving members of various divisions. But, because interpersonal relations are not good, the atmosphere may not be conducive to cooperation and discussions may remain superficial.

Or, a company’s sales representatives might sell products that are functionally appealing, yet feel no genuine pride in the company or its products.

Likewise, while a company may be able to secure solid earnings by focusing on efficiency, some of its employees might feel that the fun of creating things has disappeared.

The above examples show that, even if an organization is functionally connected like the links in a chain, the connections can break if there is no collective mentality binding them together.

Improving systems and redesigning work flows is not enough to fix the severed connections and generate greater value. In addition, many things must be redesigned: the organization, the HR system, the workplace culture, methods of communication among management, and how interdivisional meetings are arranged.

We are able to redesign organizations and HR systems because we focus on communication, which involves establishing optimal relationships between people and information flows. We apply our know-how to verify that the organizations, personnel systems, and business processes we design will actually work.

In uncertain times management needs new ideas

The amount of information available today is growing at an explosive rate, so companies are fighting to attract and retain consumer attention.

The moment a consumer judges a product or service to be uninteresting, unfamiliar, or suspicious, he or she will move on. Moreover, with consumer-to-consumer platforms in place that allow people to share and reuse products and services, the original value of these people’s possessions is declining. More than ever, the customer is king and the market is a buyer’s market. For precisely that reason, company management needs fresh ideas like never before.

At a time when circumstances and common sense about consumers are shifting so rapidly, how can new and universal value be created?

And for that value to be achieved through management and business strategies, marketing, personnel organizations, and connections with customers, how is it possible to seamlessly design all of those areas?

The answer to these questions is a high level of creativity, because that is essential for fully understanding consumer preferences, assessing everything from grand concepts through to detailed user experience and user interface designs, and executing those ideas while finding the right balance for an organization as a whole.

That cannot be done just through analysis and simulation; output that surprises both consumers and providers is required. That is the reason Dentsu Business Design Square offers a business design, rather than a consulting service.

Nevertheless, deriving solutions in the field of business design is certainly not a simple endeavor. Practically everything about a client’s management and employees directly involved in the business must be considered and dealt with on a daily basis, and if no solution appears during that process, we still need to keep working until we find one.

Understandably, many projects have been very difficult to complete, and an approach that worked successfully with one company is almost never applicable to another. Sometimes we struggle for a long time until a solution finally takes shape.

While making the most of our know-how and talent, we intend to continue engaging in dialogues with clients and exploring every possible means to assist them.

I am confident that Dentsu Business Design Square can help businesses grow by effectively applying Dentsu’s expertise in consumer behavior—that its marketing and communications businesses have built up over many years—and its creativity, which has had an impact on so many people around the world.

We live in a highly uncertain age, so I hope we can work together with companies to create new value beyond people’s expectations and build a future that serves us all well.

Shingo Yamahara

Shingo Yamahara

Director
Dentsu Business Design Square

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