Serving as a base for creating the company's future. FANCL Research Institute's future perspective.

The " Future Craft Process" provided by Dentsu Inc. Future Business Research is an approach that creates future corporate value from two perspectives: "future societal realities" and "future consumer insights."

FANCL, which offers a wide range of services in the beauty and health sectors and maintains a strong presence both domestically and internationally, used this approach to formulate its vision at its Comprehensive Research Institute last year.

This time, we interviewed Kentaro Yoshida of Future Business Research, who led the project, and Kazumasa Wakayama, Director of the Research Institute. We share Fancell's unique future perspective, rooted in its mission to "eliminate 'discomforts'" in beauty and health, its collaboration with Future Business Research, and the significance of broadening the horizons of R&D personnel toward the future.

(From left) Kazumasa Wakayama, FANCL Research Institute; Kentaro Yoshida, Dentsu Inc. Future Business Research Institute

<Table of Contents>
▼The Institute's Role: Identifying and Resolving Future Societal "Issues"

▼Projects Fostering Spontaneous Realization of "Why We Do This Work" Attract Overwhelming Interest

▼Beauty and Health Are "Means" to Fulfill Consumers' Dreams. We Want to Create a Vision That "Works," Not Just Looks Cool

▼Initiatives That Reaffirmed the "Role as FANCL's Research Institute"

The role of the research institute is to identify and resolve the "problems" of the future world.

──First, please tell us about your institute's role and mission within the FANCL Group.

Wakayama: FANCL has built a unique position over 40 years by creating diverse businesses aimed at resolving societal "problems." For example, our cosmetics business began developing and selling additive-free cosmetics while seeking solutions for customers troubled by skin issues through skincare. Similarly, our supplements business emerged from considering how we could provide affordable, health-supporting products for daily use, responding to trends like declining birthrates, an aging population, and rising medical costs.

Our company was founded on the foundation of resolving societal challenges and customer inconveniences and dissatisfactions. A major strength is our ability to seamlessly execute everything from R&D to commercialization, manufacturing, and sales when advancing relevant businesses. We consider the Comprehensive Research Institute to be the cornerstone of this process.

──I understand that Director Wakayama approached Dentsu Inc. to help formulate the vision for this institute. Could you share the reason and background behind that?

Wakayama: I assumed the role of Director of this institute in October 2022. Originally from a liberal arts background, I joined the company in 2005 and worked primarily in business strategy and marketing, handling roles in the cosmetics business, overseas operations, and health foods.

When I became director, my stated goal was to make this institute "FANCL's base for creating the future." When considering where to start, I felt it was crucial to return to the origins and strengths of our company, as I mentioned earlier.

Why was this company born and why has it endured? I believe it's because we've consistently focused on resolving our customers' frustrations – their "I want to do this, but I can't" moments – by thinking and acting beyond the constraints of industry rules and conventions. It's vital to apply this perspective and mindset to our research. Building on that, I concluded the institute's role is to accurately identify society's unmet needs concerning the "future" and propose approaches to resolve them.

While integrated manufacturing and sales is a major strength of our company, it can also lead to a short-term focus on immediate challenges like those of this year or next. These are challenges applicable to research too, but I believe research is fundamentally the department that must operate with the most long-term perspective. I wanted to use vision building to shift researchers' focus slightly further into the future, clarifying the meaning of future R&D and the areas we should tackle next.

I believe the fundamental task in any business is to predict the future, clarify what needs to be done, and build concrete actions step by step to achieve it. In research, significant time is required from technology development to product/service realization. Therefore, it's crucial to view things from a slightly longer-term perspective than sales or business departments. While searching for a partner to help organize and articulate this approach, I met the Future Business Creation Research Institute team through connections in the advertising field.
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──Was the goal to create a vision that all researchers could use as a guiding principle?

Wakayama: Yes, that's correct. Understanding the current state of the world and making predictions about the future are crucial for research. I believe it's vital to recognize where we want to be in that future, understand our current position, and then consider and act on what we need to do to achieve that desired future. Identifying this and ensuring everyone shares a common understanding is a key element for enhancing the organization and its execution capabilities. That's why I wanted to work on formulating a vision to define our institute's unique "desired state."

Project sparks spontaneous realization of "Why are we doing this work?" as applicants flood in

──Mr. Yoshida, what was your impression when FANCL approached you about this consultation?

Yoshida: During our discussion, Mr. Wakayama mentioned that "each researcher must consider what kind of future their research will create." After that, I started hearing similar sentiments much more frequently from R&D professionals at other companies. What struck me most was realizing that the role of researchers, previously defined as "narrow and deep," is increasingly shifting toward requiring them to think about "breadth" and "potential."

At the same time, I strongly resonated with the phrase "eliminating 'unfulfilled needs'." Not "negatives," but "unfulfilled needs." I understand this not as bringing negatives closer to zero, but as the intent to "enable the attainment of positive value." Many companies focus on eliminating "negatives," talking about "eliminating stress," but this "unfulfilled need" refers to eliminating situations where people cannot achieve what they "want to be" or "aspire to be." At Future Business Research Institute, we also set the "state people inherently desire"—linked to our vision—as the goal, then determine what actions to take to achieve it. I feel this shared perspective was a major common ground with FANCL that led to the implementation of this project.

──To formulate the vision, Future Business Creation Research proposed an approach using the "Future Craft Process." In this initiative, workshops were used to identify the "Life Pieces (future life scenes)" and "desired states" envisioned by the researchers, ultimately creating the vision. Could you explain the reasoning behind proposing this approach?

Yoshida: The "Future Craft Process" is an approach where we input future information, confront that future, and then discover people's happiness within it. While many current trends are already visible signs, this process focuses on identifying where future challenges, environmental changes, and people's desires intersect. It then explores what value companies and brands can provide at that intersection. Crucially, it avoids a problem-solving mindset. Instead, it sets a future customer profile, visualizes the happy state those people could achieve with the company or brand's involvement, and then uses backcasting to determine concrete actions needed to create that state.

When formulating a vision, if the question "Why are we doing this work?" is unilaterally imposed by the company or superiors, employees often struggle to internalize it as their own. Furthermore, in daily work, people inevitably tend to define the boundaries of their own tasks. Therefore, I found it effective to first create opportunities through workshops for each individual to broaden their perspective and gain spontaneous insights into their own thoughts, such as "What kind of future are we working towards now?" and "What kind of happy future can we create?" Only then should we proceed to build the vision.

Wakayama: Researchers and engineers often work individually. At the time, I oversaw six research centers, each operating independently. Communication between centers was challenging, and the environment focused on leveraging individual expertise to generate results. I felt creating a space to enhance collaboration between departments and provide insights for the entire institute was crucial—an opportunity to re-examine the scope of one's own perspective.

When we actually recruited participants, a large number of researchers volunteered. We decided to have them write presentation sheets to select the members. We asked them to write a proposal-like document explaining why they wanted to join this project and what they wanted to achieve there.

Beauty and health are "means" to fulfill consumers' dreams. We want to create a vision that "works," not just looks cool.

──This project has four steps from 0 to 3, and the workshop was held as STEP 2. What were your impressions after seeing the actual work?

※For details on specific activities in each step, please see here.

Yoshida: The workshop ran for three days. Initially, ideas didn't flow easily, and every team seemed stuck in a realistic perspective. The researchers especially seemed to feel there had to be a "correct answer." Dentsu Inc. members participating in each team helped broaden that perspective and draw out more ideas.

Wakayama: I definitely sensed a tendency to think based on the premise of feasibility, like "I can commit to this much." However, for this type of initiative, I believe it's better to first step away from reality, expand ideas to something "a bit out there," and then bring them back to practicality. This approach generates much greater differences than thinking along the lines of the current situation, and it also makes the discussion more lively. Ultimately, some themes never quite came back down from their "out-there" ideas. But for this workshop, which focused on future perspectives, I think that was actually a good thing.

Yoshida: I see "the future" as just one method, a tool, really. If you think in terms of a "forecast," the scope inevitably narrows. Shifting the viewpoint to the "future" allows us to expand our thinking beyond immediate tasks and projects. Discovering something exciting outside our own field and realizing it might connect to our research can be hugely motivating. As Mr. Wakayama mentioned, R&D is inherently long-term work, so it seems very compatible with thinking about the future.

──After seeing the 24 Life Pieces created during the workshop by our researchers, could you share any thoughts or insights you had, Director Wakayama?

The 24 Life Pieces are displayed in the institute's community area.

Wakayama: Seeing how they moved beyond "making cosmetics and supplements" to contemplate "what we want to achieve for the future" resonated deeply with me. While our daily work involves R&D for cosmetics and supplements, these are ultimately just means to an end. What our company has always valued is supporting customers in realizing their dreams, goals, and aspirations through beauty and health. It felt like a return to our founding principles.

By clearly visualizing this relationship between "purpose" and "means," I felt we could now work toward creating new products and services that solve problems for our customers and, by extension, society.

──Based on Life Peace, the Future Business Research Institute articulated the research institute's "Vision" and seven corresponding "Mindset Principles." What are your thoughts on this?

Wakayama: From the initial draft, the vision focused less on business itself and more on what we could do for our customers' future happiness and their lives. It became a vision that appropriately "exuded" FANCL's essence. Furthermore, we wanted all researchers to proactively engage in concrete activities daily to realize this vision. That's why we also created the seven "Mindset Principles."

Yoshida: Since the clear desire was to create things that truly "work" rather than just "cool" things, I focused on copywriting that researchers could relate to and easily translate into daily actions. For example, you repeatedly mentioned things like, "I remembered this mindset at the end of a meeting and decided to discuss it further," or "I want words that help make new habits stick." So, I didn't struggle much with the verbalization.

An initiative that reaffirmed our role as "FANCL's Research Institute"

──Did this project, which verbalized the vision and mindset, bring about changes within the company?

Wakayama: At this point, the changes are gradual. I believe it will take time for this vision to become firmly established and realized. However, I can feel that awareness is steadily growing—questions like "What is the purpose of our research?" and "How do I want to be for the future?"—and I see this reflected in the proposals from our researchers.

Over the past year, we clarified our vision and developed research strategies and themes based on it. Moving forward, we aim to advance concrete initiatives toward realizing this vision together with our researchers.

Yoshida: Successful companies, I believe, have a clear vision and understand that business is merely a means to that end. If the envisioned future society or vision remains steadfast, the business can advance without wavering. Conversely, without that clarity, it's easy to get distracted by short-term sales or marketing tactics, which is such a waste.

The Fancell team is truly dedicated. With nearly 40 participants in the workshops, it's rare that almost everyone attended consistently without missing a session. Their strong commitment to this project was very impressive.

Wakayama: What I found most meaningful about this initiative was the opportunity to reaffirm why our company exists. We clarified our corporate purpose and, within that, our role as FANCL's research institute. We defined what it means to be useful not just as "some research institute," but specifically as "FANCL's research institute."

Collaborating with external partners also provided broader perspectives and valuable insights. While our own scope and depth of understanding are important, experiencing the world through different lenses is something we rarely encounter without stepping outside our usual environment. Hearing from external speakers often deepened our understanding, making this a highly beneficial initiative.

In the second part, we invite three research institute members who participated in the workshop to reflect on the project's activities and share their insights, as well as changes in their work processes.

*Downloadthe overview materials for the "Future Craft Process" conducted this timehere
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