The "last mile" of DX. Making IT tools accessible to everyone.

Creating and strengthening an "ecosystem" centered around startups is a major theme for Japan to embark on a new growth trajectory.

※ Here, "ecosystem" refers to a state where not just a single company, but various public and private entities, products, and services mutually collaborate and depend on each other. This creates a single large system that activates the whole, enabling coexistence and mutual prosperity.

The Dentsu Group has also been steadily enhancing its startup support framework year after year, intensifying efforts to fulfill diverse roles within this ecosystem. This series will introduce initiatives between the Dentsu Group and startups.

This time, we welcome Mr. Soji Nishino of TechTouch, which supports corporate IT tool utilization and underpins the "last mile of DX."

Joining us are Mr. Itsuki Isayama from Dentsu Ventures (the Dentsu Group's CVC), which invested in Tech Touch, and Mr. Atsushi Ito from Dentsu International Information Services (ISID), which provides the "POSITIVE" system for corporate HR departments. We discuss the benefits of collaboration between startups and large corporations, as well as challenges in building ecosystems.

<Table of Contents>
▼The Last Mile of DX! TechTouch Pioneering the DAP Market

▼ "Supporting Japanese Companies' DX" is Our Shared Mission

▼What Challenges Does Japan's Startup Ecosystem Face!?

From left: Atsushi Ito (ISID), Soji Nishino (Tech Touch), Itsuki Isayama (Dentsu Inc. Ventures).

＜Related News＞
TechTouch and ISID Begin Collaboration on Sales of Digital Adoption Platform "TechTouch"
~Providing "TechTouch Template for POSITIVE" to Support Utilization of "POSITIVE"~
https://prtimes.jp/main/html/rd/p/000000152.000048939.html

TechTouch: Pioneering the DAP Market for the Last Mile of DX!

Tech Touch's Sōshi Nishino

──Could you tell us about Tech Touch's services?

Nishino: Our mission is "a world where every user can master their systems." Recently, under the banner of DX, companies have started using various IT tools to advance their businesses. However, there are still challenges in ensuring each individual can fully utilize these tools. We provide the "TechTouch" service, which assists everyone in overcoming literacy barriers to effectively use all tools.

──This collaboration with ISID is part of that effort, correct? ISID provides precisely those kinds of IT tools and systems to companies, right?

Ito: My HCM Business Unit primarily serves corporate HR departments. The solution we're integrating Tech Touch with, "POSITIVE," is an HR management system adopted by HR departments at 2,700 companies in Japan (※). While "POSITIVE" is a highly functional system that has been well-received, its very multifunctionality meant there were still challenges in ensuring employees at each company could fully utilize its features.

※ "POSITIVE"
An integrated HCM (Human Capital Management) solution enabling advanced group management. It encompasses not only core HR systems (HR, payroll, attendance management, workflow) but also extensive functions like talent management and mobile solutions.
https://www.isid.co.jp/positive/

──With 2,700 companies, each with different business models, does that mean individual customizations are required?

Ito: Yes. For requirements that are absolutely essential for implementation, we perform individual program modifications. However, trying to meet every single request takes time and costs money, placing a significant burden on the customer. TechTouch's service was a perfect fit for addressing this challenge.

──For systems like "POSITIVE," you can add features like tooltips and guided navigation to make it easy for any user. "TechTouch" strengthens the interface part that enables people to use the tool.

A screen showing supplementary explanations displayed via "Tech Touch" on "POSITIVE". The blue tooltips (speech bubble areas) are Tech Touch features. A key characteristic of DAP is the ability to add such functionality without modifying the original system's code.

A screen showing guide navigation implemented on "POSITIVE" using "Tech Touch". Selecting the blue-framed "Useful Guide Collection" with the mouse starts the guidance. It clearly guides users, even beginners, on where to click.

Ito: "POSITIVE" is certainly not a low-cost system. Since customers have gone to the trouble of implementing it, we want to respond to subsequent requests like "We want this kind of functionality." Meeting that need is the background to our collaboration.

Nishino: Of course, "POSITIVE" isn't difficult to use; it's a complete standalone service. However, companies often want to add various features tailored to their specific operations. We provide what you might call follow-up functions to help them effectively operate these unique tasks or company-specific systems within the platform.

We often refer to this as "the last mile of DX." We support improving usability in that "very last part" of streamlining operations with systems like "POSITIVE."

──TechTouch garnered significant attention in 2023 by securing over ¥2 billion in funding from multiple investors, including Dentsu Ventures. Could you explain Dentsu Ventures' role within the Dentsu Group?

Isayama: Leveraging the growth power of startups to create various new businesses is now essential for the mid-to-long-term growth of large corporations. Dentsu Inc. is a global company with many group companies operating worldwide, but there are limits to growing solely on our own. Therefore, we must constantly capture external technology seeds. Dentsu Ventures is the CVC (Corporate Venture Capital) established for this purpose.

──When Dentsu Inc. Ventures invests in startups, what specific goals are you aiming for?

Isayama: We aim to establish some form of business collaboration with the startups we invest in. The Dentsu Group includes not only investment divisions like ours, but also teams like Startup Growth Partners (SGP) that contribute to startup value enhancement, as well as numerous business development teams. By collaborating with these diverse departments, we contribute to startup growth on multiple levels while also pursuing new business development for the Dentsu Group.

The ideal model is for Dentsu Inc. Ventures to invest, share business strategies with the startup to create a business prototype, then hand it off to a business unit within the Dentsu Group to scale it up.

Related Article:
Supporting Startups with "Investment × Accompaniment"! Dentsu Inc.'s Fund Launches

──What was the deciding factor in investing in Tech Touch?

Isayama: We invested in TechTouch during their Series B funding round announced earlier this year. We have two criteria: financial and strategic.

Financial criteria assess whether the company has significant growth potential. TechTouch already has a robust product and a strong track record of adoption, particularly among large corporations. Then there's the potential of DAP(※), TechTouch's business domain. With society's DX advancing rapidly, this is precisely the domain in demand. So, from the perspective of "Why Now?" (Why this company now?), we judged it would definitely grow.

※DAP (Digital Adoption Platform)
Technology that supports stakeholders like employees and customers in understanding and effectively utilizing IT tools.

Next, regarding strategic criteria: considering how the Dentsu Group proposes system and web service implementations to various clients, we saw significant mutual benefits in collaborating with Tech Touch. Since we already had a track record of collaboration with ISID at that time, it was easy to envision the potential for multifaceted cooperation with the Dentsu Group.

──From TechTouch's perspective, what significance did the investment from Dentsu Inc. Ventures hold?

Nishino: How to establish business relationships with large corporations is a common challenge for startups. The Dentsu Group has dealings with numerous major companies, and ISID, our current partner, also has many enterprise-focused products. We anticipated that receiving investment would broaden our business reach and help build connections. We feel the impact of their investment daily.

"Supporting the DX of Japanese companies" is our shared mission.

Atsushi Ito, ISID

──You mentioned making IT tools "easy for anyone to use" for business operations. Is it correct to understand DAP as supporting employees who aren't very familiar with IT?

Nishino: That's where it started, but it's not limited to that. It's not just about "not being digitally savvy"; companies often have complex internal systems too. For example, we can help employees correctly input travel expense claims using internal tools without confusion. We also integrate "Tech Touch" into SaaS solutions provided by domestic companies, enabling their clients to utilize it.

──Both TechTouch and ISID share the common goal of supporting Japanese companies' DX, right?

Ito: That's exactly right. Customer feedback on integrating Tech Touch services into "POSITIVE" has been very positive. For us in the HCM Division providing "POSITIVE,"

we have the purpose of believing in people and transforming how Japan works

First, making IT tools easier for each client company's employees to use directly contributes to <changing how our customers work>. Beyond that, the process of ISID implementing systems for clients is also simplified by introducing TechTouch. While some "POSITIVE" implementation projects can take several years, accelerating this process means <changing how ISID works>. Furthermore, it enables greater efficiency for sales agents learning and selling "POSITIVE, " leading to <changing how agents work>.

As a result, we expect that introducing "Tech Touch" will make it more achievable to transform the way Japan works.

Nishino: Thank you! While still limited at this stage, we're seeing increasing examples where "Tech Touch" application enables more effective use of "POSITIVE" for its users. Currently, as announced in our recent press release, we're working with ISID to develop "templates" for broader customer adoption.

──What exactly does "templatization" mean?

Nishino: For example, since "POSITIVE" is an HR system, there are several points where employees often struggle during year-end tax adjustments. Through supporting various companies, we've accumulated know-how on "these are common stumbling blocks." So, we create "templates" that fit any client in advance and provide them.

──So, rather than customizing for each client, having templates ready for common challenges is more efficient for both sides, right?

Nishino: Yes. On the other hand, for cases requiring deep customization to meet specific operational requirements, we'll tailor solutions to fit each individual workplace.

──You've also issued a press release about providing these templates.

Ito: It generated significant buzz. The day before the release, we held a seminar for POSITIVE users where we introduced TechTouch. After the event, our survey showed an overwhelming majority wanted detailed information on collaborating with TechTouch—it was surprising. We believe this initiative perfectly aligns with POSITIVE users' needs.

Nishino: Among all the releases we've issued, this one generated the biggest response by far. It really made me feel the name value of the Dentsu Group.

Isayama: As an investment manager, nothing makes me happier!

What challenges does Japan's startup ecosystem face!?

Dentsu Inc. Ventures' Isayama Itsuki

──The Japanese startup ecosystem is one major theme of this series. What challenges and expectations do each of your three companies have regarding the environment surrounding startups?

Nishino: I transitioned to Tech Touch from a major foreign corporation, and I see challenges in business and alliances between startups and so-called large corporations. Fundamentally, there are few people with large corporation experience on the startup side.

Through our collaboration with ISID, I hope we can significantly grow both companies' businesses and demonstrate that "even Japanese startups can succeed by partnering with large corporations." This should help lower the psychological barrier large companies have toward startups.

Isayama: Exactly. I share that sense of urgency and constantly think about how we can create more positive examples. Sales collaboration, like introducing customers to startups, is important, but it often leads only to short-term partnerships and isn't sustainable. The real challenge is designing strong incentives that make large corporations genuinely want to collaborate.

In that regard, this "POSITIVE" case is somewhat ideal. It's not just about introducing customers; by partnering, both companies achieve "deep collaboration" that enhances functional value for the customer.

Ito: At ISID, we also have opportunities to speak with various startups, and they all share similar concerns to Mr. Nishino's. When trying to do business with large corporations, the bar for what's required inevitably rises. There are many steps involved in everything, and startups often lack the time and resources to adequately respond to that.

In that sense, I believe leveraging companies like ISID, which have been connecting startups with large corporations, could accelerate the startup ecosystem.

──Large corporations are also pursuing DX. What are the key points for success?

Ito: I'd say it's about "not trying to do everything in-house." We often talk about management resources as "people, products, and money." If we can source people from companies of our scale, technology from startups, and funding from venture capital like Dentsu Inc. Ventures, that could create a sustainable ecosystem.

For example, could ISID develop a service equivalent to TechTouch and implement it in "POSITIVE" in-house? It would be far too inefficient in terms of time and effort. Startups' greatest strength is their specialization, allowing large corporations to rapidly deploy new ventures into society. That, I believe, is precisely what large corporations need for their DX.

Isayama: While large corporations vary widely in their circumstances, it's clear they face numerous areas they simply cannot handle internally alone. Solutions that are "beyond our in-house capabilities but critical within our business domain" are precisely what can be achieved by partnering with startups like TechTouch. Of course, there are domains where in-house development is necessary, but I believe companies should make case-by-case decisions, selecting the optimal approach for each specific objective.

──Could you share your outlook on the future collaboration between TechTouch and the Dentsu Group?

Isayama: Currently, within the Dentsu Group, we are rapidly expanding into new business domains like DX, leading to increased opportunities to provide solutions to clients. Within this context, there are many scenarios where collaboration with TechTouch opens up new possibilities, so we aim to deepen this partnership further. Additionally, beyond just collaboration, we also anticipate potential efficiencies by introducing DAP solutions like "TechTouch" into tools the Dentsu Group uses for its day-to-day operations.

Ito: ISID will also continue to advance an integrated partnership with TechTouch. ISID provides clients with various services beyond just "POSITIVE." We hope to integrate "TechTouch" into these services and promote collaboration.

Nishino: DAP is still relatively unknown in Japan and is an emerging market. By partnering with the Dentsu Group, we aim to increase DAP's penetration and broaden its reach. We believe our mission is to make all systems in Japan easier to use, not just for businesses but also for citizens, by introducing "Tech Touch" into infrastructure systems and making IT tools more accessible.

Ito: Once you use Tech Touch, you can't go back to life without it (laughs). We hope many people will experience it firsthand.

──Thank you very much!