Innovation Grand Design: Obayashi Corporation

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Background

Obayashi Corporation has set a brand vision of "MAKE BEYOND: Pioneering creation," and is working to create new businesses and implement business transformations that are not handled by existing businesses, leading to growth for the company 20 to 30 years into the future. The Business Innovation Promotion Office, established in April 2021, is working to improve the accuracy of business models by promoting the launch of new businesses and developing educational programs that have been implemented internally up until now. In particular, the Planning Consulting Group has begun to formalize new business know-how, which tends to be personal and tacit knowledge.

Implementation details

All members of the team took stock of the current issues surrounding business development and identified any gaps between the current situation and the desired state. Based on this, we formulated a company-wide new business development process guide, including setting the activities and outputs required for business development and standardizing the criteria for judgment among stakeholders. We also incorporated the educational programs and human resources measures necessary to utilize and spread the business development process, as well as collaboration with R&D and corporate departments, into an action plan and linked them to concrete activities.

Effect

The business development process guide that was created was well received by management, and efforts to promote it within the company have begun.
The business development process guide has become a common language within the company, eliminating any misunderstandings and miscommunication not only among business development stakeholders but also with external partners, resulting in smoother communication.
In addition, the activities and outputs to be implemented became clear, and the evaluation of business development staff became clearer.

Message from the person in charge

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Customer testimonials

Obayashi Corporation, Business Innovation Promotion Office, Planning Consulting Group
From left: Tamaki Horii / Michihiko Koyama / Miyuki Kojima

01Connecting to the future 20 or 30 years from now

First of all, please tell us about the mission of the Business Innovation Promotion Office (hereinafter referred to as the BI Office).

Obayashi Corporation's brand vision is "MAKE BEYOND," and we aim to go beyond the boundaries of construction, pioneer new fields, and make people's lives richer and more sustainable. How do we go beyond the traditional boundaries of the construction industry and pioneer new fields? This is the very purpose and significance of the establishment of this office. For a company to grow, the engines of growth are the deepening of knowledge (digging deeper into existing businesses) and the exploration of knowledge (opening up areas we are unfamiliar with). Our mission is to carry out this exploration of knowledge, the creation of new businesses not handled by existing businesses, and business transformation, and to connect this to the growth of the company 20 to 30 years into the future.

Specifically, what kind of work do you do?

The BI Office was established in April 2021 and is currently working on launching new businesses that have been promoted internally, accepting people who want to start new businesses within the company, and working to improve the accuracy of business models through educational programs. The office is made up of three groups, and the Planning Consulting Group in particular is focusing on efforts to turn the know-how of new businesses, which tends to become tacit knowledge, into explicit knowledge.

02In a changing social environment

How do you perceive changes in the environment?

In this VUCA era of uncertainty, I feel that unless we encourage change in the social structures and systems that have been built up until now, we will not be able to pass them on to the next generation. We are at a turning point, with lifestyles and social environments undergoing major changes due to the COVID-19 pandemic, and the industrial structure itself is being restructured around the keyword digital. In this climate, I feel that the time is approaching to redefine the company's new positioning and what our company should do.

What are the specific challenges you face when considering new business ventures?

Our company has previously developed new businesses, such as solar power generation, a form of green energy. However, we have not been able to incorporate the launch of new businesses into the organization's explicit knowledge. Furthermore, the people in charge of new businesses are enthusiastic and working hard to make them a success. However, business development takes time, and sales do not necessarily increase immediately. Until now, we have not had a common business development process or business evaluation criteria within the company, so the people in charge have been groping around in the dark as they develop their businesses. By establishing a common process, clarifying the business's position, and being able to say from the company's perspective, "If you're in this phase, doing this will ensure success," we believe the pressure on the people in charge will be significantly reduced.
In that sense, the business evaluation methodology proposed by BIRD this time, called BIIM (*1), was extremely effective. Furthermore, the business development process and evaluation criteria formulated through this activity were well-received by executives, so we hope to spread it throughout the company in the future. This is what we mean by embedding it in the company's culture.

*1:BIIM：Bird Initiative’s Innovation Management tools

What was the deciding factor in your decision to hire us this time?

What we valued most in this request was not the glamorous success story from Silicon Valley, but the track record of transforming our headquarters in Tokyo, Japan, and the down-to-earth experience that came with it. In 2019, we had the opportunity to have Kitase (*2) give a lecture on the reform case at NEC at one of our company's events, and he explained the issues and know-how that are unique to large companies based on his own experiences, which I found very refreshing. We have worked with a number of major consulting firms up to now and received various forms of support, but BIRD was the only one that proposed content that would put the company's internal transformation into practice.

What kind of activities were you expecting to do?

My expectations were to create business development processes and systems tailored to Obayashi Corporation. I also wanted to verbalize what I was thinking through this process and instill it as a common value and language among team members. Even before the BI Office was established, my team members and I had been talking about the need for processes and necessary skill training that were different from those used in the construction industry up until now, so I wanted to create something like that this time.
During this activity, we were able to receive advice from Kitase from a variety of perspectives based on his experience in creating business development processes within major companies, and we believe that he provided us with value that exceeded our expectations.

*2: Masamitsu Kitase, CEO of BIRD INITIATIVE Inc.

03Even with hard work, results exceed expectations

How do you feel looking back on this activity?

To be honest, 17 workshops over two and a half months was hard work, especially considering my work schedule. However, we managed to strike a good balance between remote and offline work, and were able to spend more in-depth time with the team members than ever before. In particular, the initial process of writing down all of the current issues took a lot of time, but it was very meaningful as it allowed me to see each team member's level of understanding. In addition, work that required generating ideas was carried out in face-to-face workshops, and the team was able to effectively facilitate discussions that seemed to be heading in the wrong direction by organizing the points of discussion.

What were the results of this activity?

We presented the business development process and implementation plan we created during this activity to the president and outside directors, who gave us a favorable evaluation and expressed their expectations for even more. (laughs)
Furthermore, by formulating the process, it has become easier to reach a common understanding when talking with external partners. It has become much easier to understand what activities we should be doing in each phase, and discussions have become more coherent in a short amount of time. Furthermore, while the term "new business" tends to sound like something from a different field to existing business divisions, there are many methods and frameworks that can be used in existing businesses, such as service formats and monetization methods. Considering a new business is also a good opportunity to learn about management, and we hope that our new business development efforts will have a positive effect on existing businesses.

What are your future goals?

Now that we have established our mission and KPIs through this project, we would like to create a success model next. If we can achieve even one small success through the process of the project we are currently working on, I believe it will lead to confidence in the future. To achieve this, we need "people." At the same time, we also believe that we need a system to generate new ideas. We would also like to create a system to create new concepts in collaboration with the education and R&D departments.

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