CyberAgent's greatest risk management challenges are to rapidly "create new businesses in response to change" and "turn risk into opportunity."
Ashita Kaigi (Meeting for Tomorrow)
"Ashita Kaigi" is a meeting (=kaigi) led by the management team, in which new business initiatives and solutions that could improve CyberAgent's future (=ashita) are proposed and decided upon. Twice a year, each executive officer selects four people from among our business leaders and specialists to assemble teams that compete by delivering proposals. From September 2019, the format was changed from a 'ranking' format where participants compete for total score, to a 'tournament' format. This brought the event to a whole new level of tension.
Since its inception in 2006, Ashita Kaigi has resulted in the establishment of 29 subsidiaries. From these new businesses, we have generated cumulative sales of roughly 288* billion yen and an operating income of ar ound 40.5* billion yen, thereby greatly contributing to business expansion.
* As of September 30, 2020
CAJJ program / Startup JJJ
CyberAgent has unique in-house systems to promote the establishment and growth of businesses, and clarify the criteria for withdrawing from a business. These are the CAJJ Program for profitable businesses, and Start-up JJJ for startup businesses established in principle within the last two years.
CyberAgent creates numerous new businesses in relation to changes in the business environment, utilizing a “self-reliant growth” management strategy to achieve continual business expansion that is not contingent on large-scale M&A. The structures supporting this growth are our unique CAJJ Program, and the Startup JJJ program to cultivate new businesses. Under these programs, CyberAgent ranks subsidiaries and businesses, creating an environment in which they develop through friendly competition. The CAJJ Program has three performance-based ranks centered mainly on operating income, while Startup JJJ has four ranks for businesses based on assumed aggregate market value. Businesses move up and down the rankings according to specific standards within a certain period, and if they fail to meet the established standards they are moved down the rankings, discontinued, or the general manager replaced. The establishment of clear criteria avoids inflating losses from unprofitable businesses due to tenacity, while at the same time encouraging a challenging spirit for the creation of new business, and raising the profitability of the CyberAgent Group overall.
CAJJ (CyberAgent, Jigyo (business), and Jinzai (personnel)) is a business cultivation program. Businesses are ranked by level of operating income, with efforts made for business growth. Clear criteria for business withdrawal have been established, so if a business posts revenue and earnings decline for two consecutive quarters it is discontinued, or the general manager replaced.
CAJJ Program Ranks
- J1 Quarterly operating income of ¥1 billion or more
- J2 Quarterly operating income of ¥100 million or more
- J3 Surplus Operating Profit
Criteria for withdraw: Revenue and earnings decline for two consecutive quarters
Startup JJJ is a training program whose name is derived from the Japanese words for new business ("Jigyo"), personnel("Jinzai"), and market value ("Jikasougaku"). Generally targeting start-up businesses that have not achieved profitability within two years of being launched, market value is based on the idea that we want them to become number one in their market, or to become a project with meaningful impact to CyberAgent.
In Startup JJJ, businesses are ranked by market value and efforts are directed towards achieving growth. Under clearly established criteria for withdrawal, a business is discontinued if it exhibits no growth for six consecutive quarters or is unable to demonstrate competitive advantage. In October 2018, we also established a Group Management Planning Office to support business expansion via business tie-ups and stimulate swift and consistent business growth.
"Cycom," a New Business Creation Project
Cycom launched in October 2019 as a new project that allows regular and prospective employees to take on the challenge of proposing new business ideas. Proposers whose submissions have passed screening present their new business proposals to President Fujita, which is video streamed internally at the company. The process allows employees other than the proposer to, through feedback, also learn important aspects of the review process.
Financial Strategy Meeting
Strategic meetings are held once per quarter for all businesses operated by CyberAgent for the purpose of honing a 'strategic mindset' among business managers. At meetings, each business manager explains their business strategy to President Fujita, providing an opportunity to assess the growth of the business. If there are no signs that business growth either matches or exceeds growth of the overall market, strategic changes are implemented such as rethinking business content or even withdrawal of the business.