 Great, so good evening everyone. It's great to see you all back up so last in time three of Japan Research Center lecture series. My name is Satana Suzuki. I belong to East Asian languages and cultures department specializing in modern Japan and also advanced Japanese. I am actually standing in for the chair of the JLC, Fabio Gigi, who sadly can't be here because of a family agreement and he sent his apologies. He would have liked to be obviously. So I'm very honored to introduce the speaker for tonight, Professor Kawakami Masa, Masa Naos. From the School of Economics and Management at Hyogo University, Japan. So, Professor Kawakami is currently a visiting professor at JLC and he has published many, many books on 11 books, many books in mind. And business modeling and also monetization. And he has also been an advisor for many major companies, you know, entertainment companies and manufacturers and also something else. Yeah, yeah, things like that. But anyway, he's talked tonight. Yeah, so he's trying to reinvent and create business models, right? Yeah. So he's talked tonight based the title of leveraging the strengths of Japanese companies and your and you to profit doing what you love. Sounds great. So please do take it away. Thank you. Now my turn. Okay. So, how are you doing? Yeah. I'm delighted to address you all today. Yeah, thank you. And thank you for having me at JLC member and yeah, Satona and Fabio. Unfortunately, he's not here. Yeah, and thank you for your source University of London. Okay. Good to talk to you about innovative business thinking. Yes. By the end of this speech, you will be familiar with the characteristics of Japanese companies and Japanese attitude towards business. And more importantly, how to overcome them. And at the same time, learning these things will enable you to make a living doing what you love. So before we get into theoretical things, listen to this story. Long time ago, in a rural part of Japan. Yeah. Have you just kind of an image of something? No. Yes. An engineer. He had graduated from high school and set up a small signage company. He works so hard and had enough customers to make a living. Like many entrepreneurs, he really likes and pop culture and knows more about the games in the animations. And so, he was just a hobby, not job like I am people. So, but his passion for pop culture was growing uncontrollably. So one day he consulted a business expert about his source and the expert has some surprising work for him. You should make your business out of what you want to do. And then figure out how you are going to make money from it. You need some tips on that. So we'll figure it out together. Yeah. I'm your father. He struggled to come up with his own profiting way. Six months later, he launched his first business in Japanese pop culture. He became the world's most famous designer in pop culture, especially in the cosplay field. You know cosplay? Okay. And nowadays he's joining not only animation or game projects, but musicals or films. Finally, he has got to generate profits while making a world better place through what he loves. Both sales and profits have almost doubled since then. And they all lived happy ever after. Yeah. The thing is, yeah, this story is based on the truth. The engineer is named Takumi Ori. Yeah. Takumi is his first name and Ori is his surname. Now let's look at himself in depth. So he was born and grew up in Takasago City of Hyogo near Kobe in Japan. He started his factory for industrial signage, which is for restaurants, retailers, or companies, and so on. He called B2B, yeah, that business so-called B2B, a business-to-business, yes. And not just his business, as a number of customers increases gradually the competition increases and dangers profits. In the meantime, he became a bit more unmotivated by the business because what he really loves is not producing signages. He talked to a business expert and he strung his business towards what he really wanted to do. And he named his business, yeah, Takumi Amelie. You know, okay, Amelie, yes. Yeah, and I'm a creator, I'm a maker or something like that. So, back then cosplayers used real karma made of heavy weight and material like steel. And I want to use cheap look armor because of their portability. So like that, yeah. She's a cosplayer. And actually, she's also a vice president of Takumi's company, yes, now. And yeah, and he could succeed to produce real look lightweight armor made of plastics. And why he has so many competitors in signage, yeah, like this, and absolutely no one in cosplay. He didn't just propose a product. He thought about how it would make a profit for the company as a whole. And take a look at these armors and his workplace has entirely changed. In his sense, bowling every day becomes much more interesting. So, and in his sense, yeah, for example, yeah, back to him, we can buy a cosplay armor made by Takumi at convenience store at 7-Even, you know. Yeah, I'm not joking. Yes. Yeah, I'm serious. And as you can see it above the bookshelf, bookshelf, and yeah, you can see the armors. And again, in his sense, bowling every day life, every day becomes more much more interesting. So, and in his sense, yeah, during pandemic, we are forced to set partitions in schools or offices like this, yeah, same as source. Dispartitions, yes. And a normal partition is something like this, isn't it? They are annoying and both of them. It seems like, please don't visit. Yeah, doesn't it? So, in his sense, this is what happens. Yeah, this is the one. Yeah, someone in circle. Yeah, mahoujin in Japanese, yes. Yeah, like that. Yeah, he is Takumi. Yes, nice. In his sense, yes, this is what happens. So, human summoning, human summoning is something evil or fantastic by this partition, yes. And his ideas even have pandemics on their side. Yes, our busy partition. Yes, that's a cow, go, go, go, go, go, go, go, go through. Yes. And yeah, now here's Takumi, yes. It's like a super Saiyan or something like that. Manga partition. Yes, like that. Yes. Yeah, finally he became a monster or something like that. Okay. And yeah, and a normal partition costs about 30 pounds or something. And Takumi's on the other hand costs around 120. Yes, this is four times the price of an ordinary partition. Yes. But these are like hot kicks. Customization available for 150. Yeah, how about it? There's only one reason why can he develop something like this. It is because he's doing what he really loves. And he is now famous all over the world. Yeah, you know, yeah, this is an animation magazine in France. And yeah, so popular magazine. So now he is so well known that animation magazine France has taken up his business these days. Yeah, like this. Yeah. Yeah, so famous cosplay maker. So he appears invincible. Yeah, in this field. His secret to profiting is not just to sell products at higher places. And he planned to generally profits, make himself IP, you know, the intellectual property. Yes, himself is intellectual property. So I'm get involved in larger projects while selling these high margin products. High margin products have been bringing him enough cash for research. And this project and this profit generation logic has worked well for these nine years. And finally, you know this one. Yeah, right. Thank you. And he finally he participated in the animation project with Square Enix called near automata. Adapted, yeah, adapted into from the same game title. And as a number creator, designing real weapons and converting them to 2D. Yes. So he has been working with Square Enix and any plates, you know any plates. Yes. Yeah, his works. Yeah, yeah. He's works in any place. Yeah, any place is also well known for their smash hit, you know, so called Kimetsu no Yaiba. Yes. They mostly are in English. Okay. So his skills in armor production were instrumental in the realism of the animations. And he was involved in the stage production or the musical W7 casino lawyer, you know, casino lawyer, and in Japan, the Takarazuka Kageki. Yes, in the stage adaptation or the James Bond film, then is his technologies and the thought and specialties. And so far, he expanded and his business into a play for all areas while focusing on cosplay gear and game profit as a whole. This is his idea of a profit innovation and has been successful. And so far, this is, yeah, this is the event title of my presentation. So, how we all this over in the attracted enough. Yeah. Okay, so it works. And what I want to tell you about is. Yes, we always think of living with what we love. But just focusing on what we love doesn't make a living. Except for a few extraordinary people. Extraordinary people are the players in the top 1% or less. Yeah, every field. They are either gifted, brilliant, very lucky, or all already above. Unfortunately, this is the truth. How should the other 99% make a living. So, yeah, how do you achieve it? What do you think of, I have a solution business model. Yeah, so cold business model. This is a theme I've been researching and advising practitioners on. I believe it works for everybody in this hall right now. For example, for professors or the college student, or business people, or everybody. I hope it will be helpful for you to think about your own life. And a final main title again. So, by the way, let me introduce myself briefly. Okay. Yeah, I'm Master Kawakami, and I'm a scholar and a professor at the University of Hyowo, and a visiting scholar at Soros University of London. And I'm an advisor. So, I've been involved with the projects as an advisor for, yeah, or director supporting their business modeling. 30 companies or more. Yeah, I've been working with. I've been working with automobile companies in Japan or electronics companies or appliance companies in Japan. And result, result hotel or entertainment company or sports company. Yes. And in Europe, yeah, I've been working with a shoemaker in Germany. So, and watchmaker in Switzerland. And to tell the truth, Takumi's advisor was me. And here, finally, the foreshadowing was recovered. Maybe today Takumi is there and on it. Yeah, online, maybe. So, yeah, anyway, and now I am so also at a giving your advice is to four companies in London now, including a skyrocketing startups. And I'm also an author of even books regarding business model and monetizing. Yes. Yes. That's it. And, and the reason why I research these things is. Yeah, long story short. My father was an entrepreneur and a pro player. When I was three years about age, my father went bankrupt. And what do you think of? Yeah, I was so shocked. So that brought me to research on business. However, we have now we've had a no success logics on the business model or monetizing yet. The theories are not easy for a practitioner to use. And then I'm keep fighting until business model thinking becomes the norm. So, my motor is simple but pragmatic tools for everybody. Like, during this church, there's no end to it. Yes. It is my great pleasure to have found such a tough life's work like, and to you guys. Yes. And now I hear some simple business model ideas. I've systemized so far in a nutshell business model is a framework for making money. It was, it was a remembering, isn't it? So it enables companies to profit while satisfying customers. You must want to please someone else with what you love. You should be what you really love. We call it customer value proposition. Obligated as a CVP. Including this, a business model is made up of three elements with the initials PRO flow. Profiting means make a living. So profit generation. And if we want to implement the plan successfully, then you need to create a process. Yes, it's better to keep in mind as a triple plus. Yes. From business model perspective. Yeah, this perspective. Yes. I have nothing but concerns about Japanese companies. The question is very simple. Where have they disappeared to. So take a look at the ranking. Take a look at this ranking. More than 30 years ago, Japanese companies were really, really, really strong. Yes, in terms of market value, it's 21 of the world top 30 companies, Japanese companies, you know, the orange ones. Yeah, great. Yeah, yeah, it's a golden age of Japanese companies. On the other hand, what happened, what had happened to you at this city four years later. Yeah, look at the ranking from this year. Where are the orange ones. It means they've completely lost their position in the world. Where on earth have they disappeared to. All right, let's zoom out a bit more on the same ranking. Yeah, that way we could find Japanese companies. Okay, this is the one to begin with the 1989 rankings shows that essentially 32 out of 50 companies were Japanese ones. I have to say again, wow. They are not there after all upset. In 2023, the most valuable Japanese company is Toyota. But even so, it is still slightly ranked 50 to 50 second in a world. Even though Toyota has sold the most cars all over the world for three years in a row. Somehow Tesla is ranked in as seven. Yes, today ranked at 22nd. And yeah, 10 million cars, 10 million automobiles is sold. But Tesla, yes, Tesla is ranked in seventh. And which sells only 12% of Toyota sales. It is the only company in the top 50. In the automotive industry. This mystery will be solved later in this lecture. And anyway, such a sad result for the Japanese. As the example Toyota shows here, and even though Japanese products or contents are still strong. So, yeah, even in London, we can see you are playing a PS5 or eating sushi. Driving Toyota's automobiles. And enjoying Japanese contents. Yeah, Kimetsu no Yaiba. Yes. Then how come they disappeared. The answer is Japanese companies have not fully harvested their profits. I'm not saying that they should make a living from other businesses, but saying they can monetize other parts of what they are doing now. This is my message today. And when it comes to Japanese product, yeah, what is your image. Yeah, it is, yeah, in my opinion, it is process. It makes the greatest contribution to the result of Japanese companies. Process is the very strongest of the Japanese company. It consists of good imitation, manual dexterity. Teamwork. Patience. And punctuality. Yes. But as you probably know, by now, and this is not enough to make a business work well. So, yeah, the process. Yeah, as I told you earlier, from the business model framework process is not enough to work your business. Yeah, or your way of life. Now Japanese companies have been recognizing the importance of customer by position. It determines the qualities of products so it's being strongly promoted in the name of marketing. Now question, what is the component left behind in the business model framework. Do you remember? Remember, okay. Yes. This is a very missing component in the success of Japanese companies. It's not enough. Somehow Japanese companies have been still this leading profiting. Perhaps opening may sound selfish and demeaning in Japan. Yes, more gay in Japanese. But on the other hand, the top 30 companies in a 2020s are also making a difference to profit generation. Yeah, and that is that disruptors innovate profiting, which are named profit innovation. Yes. Innovation is not just about a proposition or products or process. Yeah, product innovation is easy to understand. Yeah, the iPhone or yeah, is innovation. So yeah, apps, Instagram or something like that. You can see everywhere, everything everywhere. But process is also understandable. Just in time, Toyota is building automobile systems. Yes, the efficiency, yes, the process. But yeah, profiting is left behind. But it is because many of them practice profit innovation in secret. So after this, you will see the example of US companies as successful cases, but not because I believe they are the best. Yes. But yeah, many of them practice and profit innovation in secret in fact that all we need is to run growing companies have been changing their profit patterns dynamically. Then I want to share with about what to do is to get an idea of profit innovation. Let's take a look at how to generate profits from the proposition or what you love from despite onwards and we will look at what Japanese companies should do. This is actually a useful way for you and me to think about how we approach our work. So how to profit? A question thinking, if you want to profit, what do you do? What do you do? So sell products? Yes. Is a good answer. Yes, sell products. Yes, product selling is a way to make money. Yeah, profit is price minus cost. This is a fundamental principle, but it's not the only way to profit. And it's old school. Unfortunately. But yeah, everybody likes this profit generation logic. So how to profit better. The world is already full of different profit patterns. For example, are dynamic blessing or by product. Yeah, so well known profit patterns, they're matchmaking or subscription. Remember sip and a freemium. You know, freemium. Have you ever heard of? No. But yeah, absolutely, you know, open your mobile phones. And a count the number of apps you haven't paid for. Yeah. Why you didn't you didn't pay, but a company's mega profit. Why? That is a key to freemium. So those are, yeah, the most popular profile pattern in digital startups. Yeah, free and premium. Somebody paid the premium. Yes, but almost all people don't pay. Yes, that's the freemium. We have already known some kind of forfeiting. So, wouldn't you like to know how many profit patterns there are in total. Even if only the most prominent ones. I have system as them logically. This is the one. Yes. These are typical patterns that somebody has already developed so far. And I arranged them in my book. Knowing only these things will ensure that you are not left behind in time. Subscription. Yes, subscription is there. Yes. Subscription. Dynamic pricing. Dynamic pricing. Yes. Yes. Thank you. Yes. And a freemium is 19. And yeah. Membership. Membership 19. Yeah, the freemium at 12. 20 years. All up here in the diagram. And some of these might have already been adopted by you or your friends as students or teacher. For example, office worker. Office worker, yeah, out of the 12. Because companies pay. Yeah, you at a monthly. It's a subscription. And a part-time worker 14. 14 is pay as you go. Yeah. Pay as office uses wasn't there. Okay. Yeah. Yeah. We can see the museums. In London. And adapts. 20. Yeah. In London. Yeah, free museum. But yeah, yeah, you will pay for the exhibition or something like that. So it's a freemium. And yeah, museums are membership. Yes. And. Pay in advance. Yeah, annual membership fee or something like that. Yeah. For 28. Yes, it's a donation or something like that. And college. Yes. Of course, 12. Yeah, you're paying a tuition. Yeah, and a seasonally or yeah, yeah, annually or something like that. So. Yes. And anyway, if you were studied one by one every day. You must have these 30 patterns in a month. Yeah. I did a description of these follows. Okay, here's the explanation of the 30. If you're interested in these patterns, you can take a photo. Okay. I'll use that time to give you some tips. The point is disruptors know different ways of making money. Not only from the profiting, not only from the main target. Not only from the main products, not only from the right now. Does it make sense. Yes. This is the way to create the new brand new profit patterns. Then how about Japanese companies? Yes. How about Japanese companies? Okay. Almost all former top ranked Japanese companies. Here is a manufacturing companies. And have been adopting. Yes. Just one. And number one. Actually, it is the most conservative way to recoup their cost. That's Japan. I'm in place at all. Yes. Yeah. They don't like a loss or waste at all. Yeah. Okay. So in this way, they have such a success stories. The thing is, product selling is not the only way to generally profit. Despite all these patterns, Japanese companies tend to stick to just one. We still have at least 20, 29 ways. And this tendency is not limited to product selling. The same is true of other industries. Yeah, we can see other industry. Yeah, the same thing in other industries. So companies in the same industry tend to adopt the same one pattern. Yes, one industry, one pattern. This is known as an industry practice. In Japan, where there is a strong peer pressure. So we feel comfortable when we follow convention. For example, publishers of manga. You know, the Kimetsu Mori, I've a show that Shueisha or yeah. Okay, okay. Publishers manga have adapted 22. Contents your intro topic properties. And such tendencies are not limited to Japan. Yeah. In your British companies or yeah, maybe British publishers, maybe it's the same, but often finding industries that log behind innovation. By the way, how about the UK? Yeah, UK company. Look at the UK companies that we all know. Max and Spencer's bubbly or not Mason or Astrazeneca or pharmaceutical company. Yeah, they are surprisingly employing number one on the. Yes, in manufacturing industry, and even the UK companies tend to adopt number one. It makes me wonder if the UK has the same programs as Japan. Potentially. Yeah, I'd be worried. Now what should we do. Take a look at the showcases of successful companies. Yes, US companies, but yeah, I'm sorry US company. Yeah, they're good at profiting so. Yeah, for example, you have a short case. You know, do we introduce creative cloud? You know, so because do we wanted to transform their profiting originally from one to 12. Yes. Yes, that's it. Maybe it's in 2013. Yes, the drastically changed their profit patterns. And then the example is, yes, we all know Apple. Apple. What is Apple famous for? Yes, iPhone. Yes, so tonight. Yes, I found. So pop quiz. What is the second largest category of sales after iPhone. Now let's take a survey. Okay. Make sure you raise your hand and for one of them. And there are four options. Okay, iPad. Macintosh. Well of us. And including a which is yes, which yes, and the other. Okay, there's a hand if you. Yeah. Okay, there's a handy if you think it's an iPad. Thank you. Thank you. Raise your hand. If you think it's a Mac. Macintosh. Oh, thank you. Thank you. Raise your hand if you think it's a watch or yeah, well. No. Okay, so, okay. And a little handy if you think it's something else. Well played. Thank you. Yes. The answer is something else. It's service, you know, service. So, and services are including Apple Music, or iTunes, or App Store, or Apple TV Plus, Apple Arcade, Apple News. Yeah, something like that. Yeah, Apple Music. Yes. Yeah, that's it. And on top of that, service is more profitable than products. Yes. Because this is, yeah, products and sales and yeah, this is the Apple's income statement. And we can see the products and the sales of products and the cost of sales. And the managing is almost 30%. But yeah, on the other hand, service is almost 70%. So, the profit pillar is a service now. Yes, by the way, you know this news. Financial Times four days ago. Yeah. And now, and as you know, Apple has announced that it has entered the banking sector, the financial sector, you know. Yeah. So, this is a part of its strategy to enhance its services. Yes, service. So, in short, they once adapted product selling, and when they invented iTunes, change their logic to 14, pay as you go subscription. After that, iCloud, Apple Music and Apple TV Plus, or yeah, something like that. You are at App Store. Yeah, I got to be popular. They introduced late subscription. You use the Apple Music or yeah, something like that. So, and now they are learning their business by membership, which combined the product with service. Yes. So, yeah, and another example. So, what is Amazon and famous for? Yes, online store. Yes. Buy something every day. Yeah, that's right. But from a profit view. Yeah, but Amazon's online store only breaks even. So, only AWS, you know, AWS. The infrastructure service, yeah, Lento, there is a cyber Lento service. Yes. Only AWS has been profitable in recent years. As you know, B2B infrastructure service. So, when viewed in terms of profit, yeah, we can see it. Yeah. So, you're so different at a scenery. So, in short, Amazon has transformed its online store profit generation from originally from product sales to long tail. Yes, it's a variety of products. Yes. Plime membership. Yeah. You're a subscriber. Plime membership. Yeah. Plime student or something like that. So, and it has a huge leap forward by developing into 14 by AWS. It is only thanks to AWS that Amazon can exist in terms of profit. Yes. And more example, short. Tesla. In 2020, Tesla didn't make any profit. Yeah, at all, from auto movie sales alone. How did it manage to stay in business during that time? Take a guess. Yeah, the answer is, yeah. That it profited from a carbon credit, you know, carbon credit. Yes, only carbon credit. So, Tesla's real profits only from automobile is, yeah, losses. Yes, big mess, but carbon credit and make money. Yes, that is a mystery of Tesla. So, in short, that is a Elon Musk. Yeah. So Tesla profited from carbon credit from after making a loss on automobile sales sales. And now they are able to grow on their own. Tesla invented the pattern to continue to profit from software and services for cars already sold. You know, the Tesla is updating. So Tesla's car, yeah, automobile is updating. So, and subscription or something like that. So, to combine the products with the services. And one more. Marvel. You know, yes, yes, of course, no, yeah, absolutely no. Marvel is also a company which has changed the profit pattern drastically. By the way. Yeah, it's an Avengers or yeah, I remember something like that. So, did you know that Marvel once went bankrupt in 1999? Bankrupt, yeah, and so, and please remember this path. Okay. From the profitability. Take a look at the mother's profitability over the 11 years since these crops. After the crops. They started to make a profit by licensing their IPs. You know, X-Men to our 20th century Fox. Spider-Man to Sony Pictures Entertainment. And so, yeah, and a talk for Universal like that. So, and it was successful. Because of its affinity with Marvel's customer profile position. They were able to judge the list of film production and started creating their own films. And yeah, after clubs. Marvel's IP. Yeah, it's successful. So what's successful, but And yeah, they were able to judge the list of fear. Yeah, they're clear instead and started creating their own films. Yeah, that was Iron Man. Yes, as everyone knows. Well, so, ultimately, they achieved some of the most outstanding performance in history. Yes. There are always means on retail sales. Yes. Yes. Operating profit. Yeah. So, and Marvel was subsequently acquired by Disney or for four billion dollars. Yes. And 28. Yes. So these are the facts about profit innovation. Yeah, how did you like it? And the Marvel's pass. Yes, this pass. Yes. From our product selling yet comic comic sales to IPs. Yes, there are characters. And yeah, actually, they are the talent agency of characters. And then and they and they produce their products on their own. So, and yeah, so nice and margin and yeah, something like that. And having heard of this. Yeah, you naturally want to know about the Takumi's profit innovations, don't you? To tell the truth, Takumi trace the same way of profit innovation as Marvel accidentally. Yes. And from Takumi Kogai, your products are in two contents. Yes, Takumi Amelie. Yeah. And I mean, the multi component means a stage production or film production or game production or something like that. Here's actually an hour consultant of entertainment industry. So, I would like to say the following. Yeah. The patterns are just past innovation and past inventions by entrepreneurs. And it's going to increase. Some of them become obsolete. Yeah. Yeah, that's simple. Because, yeah, the 30 patterns are like a dictionary. It's like it's like a dictionary. So, yeah, same as words. Yeah. And some are, yeah, continue to increase and some of them are become obsolete. And entrepreneurs are the people inventing on profit patterns. Yep. So, and even more importantly, you are an entrepreneur of your life. If you feel you are in trouble and try to change profit pattern, and you should create your own profit pattern, then you can find a wonderful way of life like Takumi. And yes, and yeah, more importantly, profiting is not a goal. Japanese companies can invent their business models from profiting. And profit innovation is just a trigger, making your business model sharpen up. In the first place, and if you set out to change profit generation, we have to rethink the proposition. Furthermore, if the proposition is changed, the process has to be built from scratch. In this way, the business model is completely changed from the ground up. If this idea is applied to individuals, rather than companies, it means that what we need to do in life itself will change dramatically. And in conclusion, something like this. Yeah, if you want to live what you do, what you love, you design the business model thinking. Profiting innovation tells you how to profit from what you love. And the unprecedented ways of profiting bring new propositions, which make your business model extraordinary. And the business ideas working for Japanese companies can also work for you. Having another opportunity, I'll tell you how to create your original policy pattern. Yes, something like this. So if you would like to talk to me about your way of life, don't hesitate. Yes. I'll begin with giving an email. Yes. So thank you for listening and attention. Thank you.