CEO Hisayuki “Deko” Idekoba’s Approach to Innovation

Continuing to develop innovative products requires a unique approach to leadership. In this article, we bring together insights from recent media appearances and presentations by Hisayuki "Deko" Idekoba, President and CEO of Recruit Holdings.

Creating services so convenient that you can’t recall how you did without them

My daughter wanted a smartphone for her 12th birthday, saying, "I can't hang out with my friends without one!" When I told her that I was able to manage just fine without one when I was a kid, she replied, "It's because they didn't exist back then!" But when she asked me how I did contact my friends, I couldn't remember — I guess I'd call their home landlines and ask for them when their parents picked up.

When a process becomes really convenient, you tend to forget how you went about it in the past. It's what I call a "WOW Experience." I believe that being able to create that kind of experience represents our value as a company — it's the reason why each of us works here. It would bring me so much joy to create at least one innovation that, in 30 or 50 years, makes people wonder, "How did we do things before this?"

I often use the example of running an udon restaurant to explain to my team how to do this. You start with making delicious, no-frills udon noodles, and then you would probably focus on the technical details to boost revenue and profits. For example, setting the price according to your location and clientele, perhaps adding tempura to your dish, or designing a set meal that offers good value for money. But I think what's crucial is whether you get the basics right for making an excellent udon dish — flavorful broth and delicious noodles.

One of the values of Recruit Group is to WOW THE WORLD, and our mission is to provide Opportunities for Life. It's important that, when we look back a decade or two from now, we see people being amazed by how easy something has become, and we do this by providing the best possible products and services to users worldwide.

That's why our primary focus is on creating value. Even if you have a great business idea, you can't break ground by thinking about the market size or wondering if it will generate enough profit. Based on my experience, I think you should consider value creation and monetization separately — these two concepts shouldn't overlap.

For example, Recruit has continued to change its business with the times. We went from publishing listings magazines, to the internet, from our advertising business to matching platforms. We now even offer business support through our SaaS solutions. People sometimes ask me how we can continue to create one new business after another. My answer is that we simply think of ways in which to benefit our users — how can we make their lives more convenient? Our ever-evolving business results from pursuing this question and having it at the core of our mission and vision. The decision to shift from magazines to the internet, or to merge our business support services using SaaS, arose from our belief that we could create new value and make things more convenient for individual users and client companies. This is why we can and must continue to evolve with the changing times.

Of course, it's important to understand what your business model is or to have a system for proposing new business ideas, but as a starting point, your self-identity as a company is critical: if we had boxed ourselves in as a listings magazine company, we could not have become who we are today.

Good management is not about avoiding failure but regulating the total number of failures

People often ask me, "Recruit continues to create new businesses and has completed many successful global M&As. How do you manage them all?" While I appreciate the positive reviews, the reality is that we've had our fair share of failures. If we take those into account, the number of new endeavors we take on is enormous.

When someone comes up with a new plan, even in daily meetings, you often hear comments like, "That idea failed last time, it's best not to try" or "You're just setting yourself up for failure. Let's use a different approach." I'm not a fan of this zero-tolerance-for-failure mindset. An individual or team that never fails may be considered outstanding, but I think it's also an indication that they're not taking on challenges that match their abilities. Think of the long jump. In this sport, just one good jump among a set number of attempts determines your score. What if the governing body set the rules so a single foul could disqualify you? I'm sure the world record would be at least a meter shorter. The same goes for business. When you're trying something new, you can nurture an environment where employees feel like it won't be a problem for the company if the project doesn't work out, or you can choose to make them think that failure is unacceptable. Depending on which approach you take, the results will be completely different.

Suppose you want to create new value and revolutionary services that have never been seen before. I think it's vital to set challenging goals that bring great joy to everyone involved if you achieve them, and just keep in mind that when you set lofty goals, failure is inevitable. When I was younger and first put my mind to transforming the industry, I faced many serious setbacks. However, my superiors and mentors told me that it's just a by-product of youth and inexperience, and encouraged me to keep trying.

Looking back now, I can truly appreciate those management techniques. I was given the freedom to try new things, even when I was setting myself up for failure. The team was led in a way that allowed us to meet performance standards even while taking on risky challenges. These experiences taught me that good management is not about avoiding failure, but regulating the total number of failures, and reassuring the team that even if things don't go according to plan, it won't affect overall performance assessments. I believe it's the manager's job to foster this kind of work environment.

The world’s most powerless CEO

I always say that I want to be the world's most powerless CEO. Because I think it would be better if people who are working hard on the front lines and know what they are doing made the decisions.

I recently met a man who loves playing baseball. He told me that he and about 20 friends regularly gather by the river at 5 am to play it. They finish at 7 am, and go straight to work. No one's forcing them to do this — they all just voluntarily gather at the crack of dawn. I think this is what passion is all about. If the company told them they needed to show up at 5 am to achieve their goals, there would be a lot of resistance. When organizing a team or a project, rather than appointing someone from the top, it's better to assign the leadership role to someone who wants to get involved, as they'll attract more team members with that shared passion. This kind of spontaneously-formed team is usually great at demonstrating their skills and abilities.

Behind this approach to management is our concept of "bet on passion" — a value that the Recruit Group has cherished since its founding. I interpret this phrase to mean that it's okay to be individualistic and self-indulgent. What's important is each individual — the company is merely a vessel for nurturing an environment where individuals can devote themselves to what they want to do with passion. This idea is deeply ingrained in our company culture.

In recent years, companies worldwide have incorporated Diversity, Equity, and Inclusion (DEI) and Human Capital Management (HCM) into their culture. However, we have practiced this idea of accepting individuals as they are since our founding over 60 years ago — I'm impressed by how ahead of the times Recruit has always been. This deeply ingrained aspect of our corporate culture inspires management to draw out and apply every employee's passion. We don't tell our employees what to do, but instead ask them what they want to do or think should be done. For example, when an employee brings me multiple proposals to choose from, I ask them why they didn't pick one. I tell them, "If you're passionate about this business and think it should be done a certain way, I'll take your word for it since you have more expertise than me." We implement this management style in our Group companies worldwide too, and it has been met with surprise in every single country.

If each employee has passion, there is no need for a CEO to have authority or power. My employees know best, so I leave it in their hands. This makes my job much easier!