“New business development is “Sen-Mitsu”. It is Japanese saying which means 3 (Mits) out of 1,000 (Sen) will succeed. There are the researchers who continue to challenge in such world. They are the members of Toshiba TEC’s “Future Create Activity”. What method did they choose to keep coming up with countless ideas? How have they continued to keep motivated as they continue to challenge new business planning? Based on the skills and beliefs they have cultivated through their activities, what is the new frontier to aim for? We asked them about the trajectory of their activities and their future prospects, including the examples of the five approaches utilized.
Creating the “third business pillar” through Future Create Activity
In 1950, Toshiba TEC was spun off from Tokyo Shibaura Electric Co., Ltd. (now Toshiba Corporation), and initially the fluorescent lamps and Japanese type writers were their main businesses. Currently, the company is expanding widely in Japan and overseas, including auto-ID (automatic recognition) and inkjet heads with two pillars, 1: Retail business which deals with the solutions for wholesalers and retailers mainly with POS (Point Of Sales) systems and 2: Printing business which mainly deals with the office solutions such as digital multifunction devices.
The POS system is known as TEC brand in Japan and boasts the No. 1 share in both Japan and overseas. It is self-checkout that has been growing recently. The RFID reading self-checkout, developed for clothing stores in 2017, has attracted the attention for its innovative technology. In the previous self-checkout, the customers had to scan the barcodes by themselves, but with this self-checkout they do not have to di it. The wireless “RFID tag” can scan everything in bulk, so it automatically scans multiple items in the shopping cart. This new technology, which is expected to reduce cash register waiting times during busy periods and improve the turnover rate in stores, provides the solution that applies the automatic recognition technology of RFID to the retail business (self-checkout).
While advancing such pioneering development, the company was growing a sense of crisis due to the rapid changes in the business environment in recent years. In the retail business, POS terminals were decreasing due to the spread of the tablet terminals, and in the printing business, the market growth in the business was slowing, and it was no longer stable condition.
Based on these background, “Future Create Activity” began. The researchers with a sense of crisis about this situation launched it in 2011 with the aim of creating new businesses. Mr. Hiroki Kanno (Director of the Research & Development Center, Product and Technology Strategy Planning Department), who has led the activities, talks about his thoughts at that time. “As the market growth of the two main businesses slows, what can our R&D Center do to grow our business? I thought that would be the creation of new businesses and products centered on technology. I wanted to create new “third business pillar” that was not bound by existing businesses.”
The policy is “entrepreneurial mind”, thinking about the future all the time
In the Future Create Activity, they are working together with all members in parallel with the actual daily research and development work. The policy is “entrepreneurial mind”. It is said that entrepreneurs continue to look for new ideas 24 hours a day, however why should the researchers and everyone should have the “entrepreneurial mind”? Mr. Kanno said, “It is very important that the researchers are always thinking about the future, but the ideas will never come out if they just sit in front of their desks and growl. If they are always aware of this activity in a corner of their head, everyday casualness may lead to ideas. That’s why we’re all working with entrepreneurial mindset.”
Then, how did they proceed with the actual activities? At the beginning of the activities, they did not incorporate any methods. They all got together to come up with ideas, but “gradually new ideas disappeared, and we started the various efforts to devise methods”, says Mr. Kanno. Since then, they have been working on new business planning using a total of five approaches while changing the approaches every year.
The first (1) “Megatrend starting point” approach was to investigate the trends in growing business areas (food, energy, medical care, education) other than their own company, and explore the research themes based on that. In the second (2) “Future insight (scanning method)”, they collected news information with a strong impact, and from there they predicted the future social changes and came up with ideas. The first two of these were only worked on by internal members, but they could not create any research themes.
Mr. Kanno was looking for a new approach, and the turning point arrived in July 2014. In the seminar on “Transformation to a Research Institute that Can Continuously Create New Businesses” (sponsored by JMAC), new business planning approach starting from the external promising technology, which had not been worked on internally in the past, was introduced. JMAC consultant. Mr. Kanno was very interested in it, and decided to ask JMAC for support.
In August 2014, Toshiba TEC, with JMAC as its partner, embarked on new challenges.
By converting to ‘Technological starting point’, they further enrich their ideas.
This is where the third approach started with JMAC support. In the approach of (3) “Technological starting point”, they gathered the information on promising technologies in the world and thought about whether it could be used in their new business.
Among them, “Promising Technology Sheet” and “Virtual Catalog” were utilized. The “Promising Technology Sheet” summarizes the 100 technologies explored one by one from the viewpoints of “technology overview”, “products and services that can use technology”, and “customer value”. How did they explore 100 technologies? Mr. Kanno explains, “The members of the R&D center tend to be limited and subjective because they look for them from their field of expertise and interests. In order to comprehensively and objectively search for external technologies, we searched them together with JMAC while receiving advice on “which sources to access” and “what kind of way to look for them”. The 100 technologies explored were scored by the evaluation items presented by JMAC (sharpness, applicability, feasibility, etc.) and selected for the technology to move on to the next step.
In parallel with this, they conducted a macro trend survey. They investigated the growing products in the world and predicted the future needs based on their growth factors. They came up with an idea by combining this macro trend with the selected promising technologies. In the “Virtual Catalog”, these ideas were summarized one by one from the viewpoints of “customer value” and “product and service image”.
The characteristic of this approach is that it has shifted from “social issue starting point” to “technological starting point”. Mr. Kanno recalls at that time, “Since we are engineers, after becoming the technological starting point, the ideas have been enriched, and the discussions have been raised.”
In 2015 the following year, they re-worked on (1) “Megatrend starting point”. In 2016, they planned a new business that can be developed by evolving their own technology based on the (4) “Core technology starting point”, and in 2017, they planned to aim for solving the social issues by (5) “Social issues and SDGs starting point” with SDGs (sustainable development goals) set by the United Nations as a hint of the resolution of social issues. In this way, they have changed their approaches every year, sometimes deepening the past approaches, and been working on planning new businesses from various angles.
Mr. Kanno says “It’s very hard to keep coming up with new ideas, but JMAC has a lot of knowledge and experience in ‘how to get ideas’”.
JMAC consultant says “While planning new businesses, it is important to increase the sensitivity of antennas on a daily basis. The researchers tend to focus on their own themes due to their high level of expertise, but I think it was great that looking outside in this activity broadened their horizons.”
What is needed in “Sen-Mitsu” world is “determination” and “tenacity” not to give up.
In the Future Create Activity, they have focused on maintaining the motivation of their members while improving their business proposal skills. It is said as “Sen-Mitsu” (only three out of 1,000 succeeds) because the plan of the new business like this activity is not really easy to produce the result. Therefore, it is important to keep the motivation and continue the activities without breaking their heart.
Mr. Kanno says that he is always trying to convey the significance of these activities in order to foster the motivation of the members. “The mission of our R&D Center is to do the research that will lead the future of our business, and we talk about the Future Create Activity being an activity for that purpose whenever we have the opportunity.”
In addition, in order to have an image of success, we invite people who have actually succeeded in new businesses from other companies, and have the opportunity to listen to their lectures. We’ve held two meetings via JMAC so far, and Mr. Kanno says “We often end up just listening to the story with one-way communication at external lectures, but this format was very helpful because we were able to hear a lot of stories directly.”
In addition, instead of completing activities only within R&D Center, they are actively disseminating the information to the entire company. For example, at the annual “R&D Center’s Results Presentation” for the entire company, they create a corner for Future Create, and the researchers introduce it themselves using the presentation panels. Toshiba TEC’s management and employees from every department visited the venue, so the term “Future Create Activity” is now well known company-wide. Mr. Kanno says “It is very important motivation for the members because the top management and the marketing department are particularly interested in, and they can receive the helpful advice directly on the spot.”
JMAC consultant says “In new business development centered on technology like this, it is important for the engineers themselves to develop their dreams and motivation for the theme by working on the project, and I would like the engineers to have the “determination” and “tenacity” that will not give up until the commercialization as the central figure in solving various issues leading up to the start-up of the business.”
Looking back at the footsteps and moving forward for further results
As a result of seven years of Future Create Activity since 2011, they have achieved some results. One example is “Creation of research themes”. In 2014, the research themes developed through (3) “Technological starting point” have been transferred to the business division, and the research continues. Another example is “Reflection of the theme in the medium-term technology plan”, which is the research theme developed through (4) “Core technology starting point”. It was a big step that the theme that would be reflected in the medium-term technology plan was born from the Future Create Activity.
Looking back on the series of activities, Mr. Kanno says that it was also a big part of the synergistic effect with actual daily work. “The activities broadened their horizons, and they often found the hints for the existing businesses through the various things researched. Also, while working with JMAC, they were able to learn the perspectives such as ‘how marketability is’ and ‘what kind of business model to make’. It is also very useful for drawing the business outputs on the research themes in actual work.”
And now in 2018, all-hands actions by Future Create Activity are temporarily suspended to sort out the vast records. Mr. Kanno says “Every time, a similar theme comes out in a considerable proportion, and new employees who arrive in the future do not know the past activities, so we have created a dedicated unit to reread the past records and summarize them in a form that is easy to be read and utilized.”
Create strong businesses by creating one-of-a-kind technologies
As he steadily prepares for the future activities, Mr. Kanno talks about his expectations for the members as follows; “As JMAC mentioned earlier, researchers are very highly specialized people, so they tend to concentrate on the businesses that are close to them. Now the entry of different industries is accelerating, so I would like them to broaden their perspective and actively work on crossing with other industries. The purpose of Future Create Activity is to broaden their horizons, so I look forward to that.”
He also says that the organization must conduct the research and development in response to the speed of the times. “We can’t move on unless we cross industries to cope with Society 5.0 (one of the basic guidelines for science and technology policy advocated by the Japanese government which covers three elements that should be emphasized in aiming for sustainable growth: aiming to solve social issues by making full use of IoT, AI, robots, etc.), ESG (three important items for sustainable growth; Environment, Social, and Governance), and so on. I would like to make our organization able to work precisely on IoT introduction etc., according to the speed of the times.”
Finally, he talked about the new challenges of Future Create Activity. “Compared to the beginning of our activities in 2011, the pace of change in the business environment is accelerating further, and the market competition is intensifying. Under these circumstance, we have set out a policy in our medium-term business plan to expand our two main businesses of ‘shops and offices’ to their surroundings such as consumers, logistics, and manufacturing.” Since we are a technology company, in order to realize it, we must create the technologies and products that only we can do with our core technologies, such as RFID collective self-checkout, instead of buying technology from the outside. Therefore, in Future Create Activity, we would like to challenge the creation of new technologies in addition to the creation of new businesses so far. I have a desire to create a strong business from a technology point of view, so we are considering the ideal way of Future Create Activity, including what kind of research should be done for that purpose.”
Toshiba TEC researchers who have continued to challenge “Sen-Mitsu”, with their reliable technology and the strength cultivated through Future Create Activity, are now entering the time of further leaps forward.
Comment from the consultant in charge
Insights into the future social issues are the key points for new business planning
In the new business planning in R&D department which is engaged in the medium and long-term R&D, it is necessary to gain the insight into the future social issues and to envision the technologies that solve them. However, it is difficult to gain such insight into the future social issues without any input. It is essential to gather the information about the signs of changes from various perspectives so that we can clearly draw a vision of the future society. Toshiba TEC also collected the information about the signs of changes, including those from the outside of their own specialized fields with a number of perspectives such as the megatrends and the external technologies. We also hope that Future Create Activity will increase their antenna sensitivity to the signs of changes and further enhance their organizational capabilities for planning.