E-book: 'What is Innovation from an Advertising Agency?' Chapter 1: "What is Innovation in the Modern Era?" (2)

The "DENTSU DESIGN TALK" series, compiling talk sessions between Dentsu Inc. creators and leading creators, intellectuals, and executives, has been published by BookWalker Co., Ltd .'s compact e-book label, [Kadokawa Minutes Book].

We present a brief introduction to the first session released on January 30, 2014: "What is Innovation from an Advertising Agency?" featuring Mr. Dai Tamura, Co-Representative of Re:public after working at Hakuhodo, and Mr. Kenji Shiroto, Special Advisor at Dentsu Inc.

　

＜The Role of Consulting in an Era Where New Ventures Are More Accessible＞

Tamura: At a certain point, I began to feel the limitations of consulting work. Consulting services must deliver answers that precisely address the challenges within a specific business domain. If a ball is thrown at you, you have to hit it back into fair territory. We receive substantial compensation for fulfilling that role. And because of that business model, I sensed a distance from achieving truly groundbreaking business creation. Now, I believe the barrier to creating new ventures has dramatically lowered.

Whereas making a single mold used to cost tens of millions of yen, now you can get one done for around 50,000 yen using a 3D printer. Thinking about it that way, when you first try to get something started, what would have been dismissed by an ad agency as "There's no way you can do that new business" now becomes "Sounds great, let's build a manufacturer together."

The question is whether we can break down the boundaries between client and agency, or client and service provider. Especially in the context of advertising agencies and consultancies, many practitioners are unconsciously confined by these frameworks. I want them to recognize that breaking free from these constraints is increasingly possible.

Shirato: This reminds me of something Hiroaki Shukuzawa, who served as coach of the Japanese national rugby team and as Managing Executive Officer at Sumitomo Mitsui Banking Corporation, shared about his experience consulting for investors. When a client asks, "Is this A or B?", if you say "I don't know," that's not consulting. So they won't pay someone who can't say "This is A" even if they don't know. Saying "It's A" makes both sides think, "Is that really true?" Someone who answers "Well..." the moment they're asked is a bad professional.

In contrast, in the consulting services we envision, it's the amateurs who break through the barriers in categories where everyone is struggling. Professionals are struggling, so they're seeking opinions from amateurs, right? In other words, the demand is shifting towards wanting input from people who are experts in different fields or who bring a different perspective. Relying on a single company is too risky, government agencies lack the funds to initiate projects, and universities, meanwhile, are focused on conducting research that benefits society. Big problems can't be solved by one company or one person alone. We need to come together and think collectively. That's why how we gather becomes incredibly important. Who will facilitate and produce when we do gather? I think the next step beyond that is questioning how to systematize this very process of gathering.

 

 

Another challenging aspect of consulting is the perception of quality. Engineers pursue physical quality, capable of reducing weight by 0.5% or enhancing brightness. However, for B2C products or services, if users find them difficult to use, or if they dislike the design despite good performance, that's a deal-breaker.

Beyond that, there's sensory quality—how much impact it has on daily life. Then there's social and environmental quality: "Does this product burden the environment or society?" "Are problematic raw materials used?" More concretely: "Does it involve child labor?" "Is it recyclable when broken?" Manufacturers have engineers and product designers. But they aren't users, so they don't understand sensory quality, let alone social and environmental quality. However, without these three perspectives, it's impossible to judge if a product is good nowadays. No matter how high the product specs are, if it misses the mark on any of these three perspectives, it instantly becomes worthless. That's why I believe it's crucial to collaborate with people who bring different viewpoints and standards.

 

＜Think Ecosystem, Not Just Business＞

 

Tamura: Exactly. I recall speaking with Jane Fulton Suri, one of IDEO's founding members who introduced research as a practice there, about five years ago. She said, "What IDEO must do now is design ecosystems." At the time, I couldn't grasp what she meant at all. But I had many opportunities to reflect on her words afterward, and gradually, her thinking clicked into place.

A researcher at Fujitsu Laboratories recently said something similar:

"Companies always say, 'First and foremost, think about the business model.' But I think we should stop that. I'm constantly thinking about how to build an ecosystem."

In other words, whether it becomes a business can be figured out later. When you first have an idea about what kind of ecosystem could spark a chain of new value, or when you have an ideal vision like "This is beautiful" or "This will make society better," only then does the question arise of how Fujitsu gets involved, or how government gets involved, or how Dentsu Inc. or Hakuhodo get involved. I deeply resonated with that.

Of course, ecosystems don't just form on their own. Creating them requires a certain kind of leadership.

 

Shirato: When introducing our consulting services and asked, "What kind of packages do you offer?", I respond like this: "We have Pine, Bamboo, and Plum. The highest tier, Pine, is where we handle everything for you. It requires no effort on your part, but conversely, there's little room for involvement, and some might find it unsatisfying. On the other hand, the Plum option only allows us to offer advice at specific points, so while the cost is lower, achieving results will be difficult. If we look at the Bamboo option in between, we can have you assign people from various sections, including your top talent, and we assign various personnel from our side. This creates a project team of about 10 people, like a president-level initiative, enabling us to exchange insights openly and collaboratively." This approach often works well.

Furthermore, relying solely on Dentsu Inc. is insufficient. We bring in university researchers and individuals we want to work with or hear from, assigning them as project members.

For example, when asked to develop a car, we consider that a car is the second most expensive thing people buy in their lifetime. The most expensive is probably a house. While people buy houses and cars separately, they ultimately end up being used together. So, we expand our thinking: what if we collaborated with a house builder to design the car? For instance, if it's an electric vehicle, the car could just roll right into the living room. Apart from tire dirt, it wouldn't get dirty since it doesn't emit exhaust. It could serve as an emergency battery, or function as a sub-space within the home where you could smoke or listen to music. This kind of completely different thinking becomes possible.

Also, if young people not driving is an issue, consider creating an AV space for about four people. That leads to the idea of getting a manufacturer like Sony, which makes AV equipment, deeply involved, and then adding tires and speakers later. Depending on who you partner with, you discover each other's value from different perspectives. Then, actually meet and discuss things deeply. You might realize that the problems each of you faces aren't as big a deal as they seem from the outside. By shifting the perspective on these problems like this, we might create an environment where previously difficult challenges become easier to solve. I believe this is the kind of approach we need to pursue.

(To be continued)