Recruit Japan: Harnessing Data to Create Value
Who – the protagonists
Ken Asano, Corporate Executive Officer of Recruit Lifestyle, Yoshihiro Kitamura, Managing Corporate Executive Officer of Media and Solution, and Alon Halevy, Chief Executive Officer of Recruit Institute of Technology.
Recruit offered permanent and temporary staffing, executive search and online recruitment services. It was also a leading provider of a wide range of classified advertisements and value-added services in areas such as travel, real estate, cars, dining, beauty and weddings.
Recruit had rapidly scaled up its diverse businesses to become a leading service provider with a number of web-based platforms that connected SMEs with customers and also digitised several activities, such as point-of-sale registers, reservations and payments.However, the platforms were specific to individual businesses and Recruit had to develop a unified backbone to create greater value through cross-vertical functionalities.
By 2015, Recruit’s digital platforms were generating enormous amounts of online data on types of transactions, end-user behaviours and SME business characteristics. It also held significant deep offline data that resided within the sales team. Recruit sought to combine data from all business verticals and leverage data analytics, machine learning and artificial intelligence to drive operational efficiencies and spur innovation.
At the turn of the millennium, Recruit had gained a commanding position in Japan as a conglomerate running a major staffing service and diversified advertising businesses. By 2016, Recruit was the world’s fourth largest staffing company by revenue and the largest HR company in Japan.
‘We cannot rest on our laurels. We recognise the need to cannibalise ourselves. It is extremely difficult to destroy and rebuild a system that we have meticulously built and rewrite the rules of the game.’ – Masumi Minegishi, President, CEO and Representative Director, Recruit
The protagonists’ mandate was to drive technological innovation and identify new business opportunities to secure Recruit’s position as a global digital media leader. Yoshihiro Kitamura said: ‘The future is in “real-time innovation” and in the technology that will blend offline and online data so that the divide will eventually disappear. If we can grasp that moment of digitization and have dominance in that sphere, that will be our winning card.’
Can Recruit leapfrog into the future and transform itself into a truly global Internet corporation?
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Howard Yu, Thomas W Malnight and Ivy Buche
The authors discuss writing their case and why they believe in-depth interviews are so important.
We are honoured to win this award as the IMD team. The case method is core to teaching in IMD’s MBA and Exec Ed programmes and we consistently develop new cases to bring the latest management thinking to the classroom. A winning case is a validation of our efforts and we hope for wider adoption by institutions worldwide.
Rich and insightful
We believe that primary source cases are significantly richer and more insightful due to the in-depth interviews that we conduct with key company personnel. We ensured 360-degree information gathering by requesting a cross-section of interviewees from business, technology and sales.
We also prepared a questionnaire in advance to guide the conversation, especially given the constraint of real-time translation from English to Japanese and vice versa. However, we sometimes deviated and probed deeper when we discovered interesting management nuances, challenges and learning points during the interview.
In our opinion, the key risks facing Recruit are: Can it move fast enough to integrate the offline and online data to first create value for customers and then capture value through new revenue streams? Can it build the necessary organisational capabilities to deliver data-driven innovation? Above all, how will it democratise data analytics to successfully inform decision-making at the business level?
We took a two-pronged approach to the teaching note. We identified the key themes that emerged from the case, and then looked at a range of teaching frameworks that we could use to map the issues and the learnings from the case. We also developed a set of questions for student that we used in class during a pilot test. This was key to rounding off the teaching note.
We remember our initial hesitation because of the need to rely on translators when conducting our interviews. We worried that the language barriers might become too formidable. But in fact, the context of the company was so interesting that this quickly outweighed any other concerns. So we now believe researchers should always place themselves in interesting, and even alternative contexts, to maximize learning and serendipitous discovery.
About the authors