Commitment to Excellence: Tackling New Business Ventures and Product Development with Takuto Seita of Mitsubishi Corporation

In the midstream area of the materials supply chain, including the steel industry, there are many distribution trading companies and wholesalers that stand between numerous buyers and suppliers and flexibly mediate transactions. Mitsubishi Corporation (hereinafter "MC") has launched PaSS-Portal, a quotation and order placement platform, as a digital product that supports the quotation and ordering process. PaSS-Portal was launched in January 2023 for business use by Sumisho Metal One Pipe & Tubular Products Corporation ("MSTP"), an initial user, and is currently in the process of requesting joint use from MSTP's suppliers (e.g., piping equipment manufacturers such as fittings and valves).

In this interview, we asked Takehito Seita of Mitsubishi Corporation, who promoted the development of PaSS-Portal, about the difficulties he experienced in developing the product and how he overcame them, the innovations he made when introducing the product to each MSTP location, and the background behind the quick turnaround from concept to product release, which took only one year and three months.

Mitsubishi Corporation

Takehito Seita, Manager, Industrial Materials DX Department, Materials Solutions Division, Integrated Materials Group

Seita joined Mitsubishi Corporation in 2013. Assigned to the Steel Products Division, he was seconded to Metal One Corporation from 2014 to 2019 and to Sumisho Metal One Pipe & Tube Corporation from 2019 to 2021. After a total of seven years of secondment, he returned to the Head Office in April 2021 and assumed his current position.

ROUTE06 Inc.

Professional Services Division Product Manager Yusuke Inui

He joined Recruit Communications Inc. in 2016, moved to Fukuoka in 2020 to work for LINE Fukuoka Inc. and participated in the Smart City Project. where he is in charge of product development for ``PaSS-Portal.

When the project was launched, "I was brave and prepared with my colleagues."

Inui: The Integrated Materials Group to which you belong, Seita, is engaged in sales and trading of various materials, business development, and business investment for industries such as automobiles and construction infrastructure.

Seita:Within the General Materials Group, the Industrial Materials DX Task Force, to which I belong, is an organization that develops and provides digital services that contribute to improving efficiency and quality mainly in the area of distribution. I began researching the subject when I was assigned to the topic of "digitization of ordering and transaction documents" in August 2021.

We found that the "transaction intermediary work," as typified by MSTP's Piping Equipment Division, which stands between numerous buyers and suppliers and handles a huge volume of quotations and orders on a daily basis, is extremely complicated work that involves Excel, handwritten work, and managing printed paper in clear files. We realized that the "transaction intermediary work," which involves handling huge amounts of quotations and receiving and placing orders on a daily basis, is a very cumbersome process that involves Excel, handwritten work, and managing printed paper in clear files.

Inui: What were some of the difficulties you encountered in formulating a hypothesis based on your findings, and in thinking about how to tailor a solution? How did you overcome these difficulties?

Seita: Initially, I found it challenging that what I saw as problems were not necessarily seen as such by the people directly involved. Under such circumstances, I was careful to make sure that all MSTP members who wanted to participate in the development project as initial users made their own decision to participate in the project. This was my first time developing a digital product, and I felt that in order to thoroughly and deeply investigate users' needs and consider the best solution, we needed to involve the initial users from the development stage, and we needed people who would seriously engage in that deep investigation and consideration.

Dry: It must have been difficult to make the decision on your own. How did you move forward?

Seita: I thought that we had to work steadily and carefully on this matter, and since my initial proposal to the MSTP Plumbing Equipment Division in October 2021, I have been conscious of avoiding a one-way response, and have carefully engaged in two-way communication with them. I have not only said, "I want to do it," but I have also asked them what issues they are facing on a daily basis, suggested that we look into existing products together rather than developing them, and at one point invited an outside lecturer to give a DX seminar. At times, I would invite outside lecturers to hold DX seminars. I always tried to think together with them so that they would see me as a colleague who wanted to improve something together.

At the end of January 2022, four months after the initial proposal, the MSTP side officially announced, "As you proposed, we would like to work on the development of a digital product with the theme of quotation and order receipt/placement. I remember how happy I was when I was informed that the 10 members who wanted to participate in the project had been selected. I immediately contacted ROUTE06, who had been informed of the contract offer, and said, "Thank you for your patience.

Inui: Indeed, I remember well that when Seita approached ROUTE06 in the fall of 2021, it was a toss-up as to whether or not everyone would work together as a team, and that was really where we started.

Seita: Yes, that's right. But it is precisely because we did everything right in the beginning that we are here today. I think now that it was not a bad thing that we had the courage to create the timing for everyone to make a firm commitment, rather than just starting out without a clear idea of "who wants to do this".

Listening to the smallest voice to refine the product

Dry: PaSS-Portal is a project that involves a very large number of people, but is there anything that you have tried to do to ensure that all stakeholders can contribute their values?

Seita:There are two key approaches. First, creating a positive atmosphere was crucial. Some of the 10 MSTP project members were concerned about the project's potential lack of results, and they worked very hard on steady tasks such as inventorying the workflow and surveying man-hours while performing their daily duties, so I think the workload was quite heavy. I think it was a considerable burden on them. In response to such burdens, both physical and mental, he said, "Let's all encourage each other to do our best! I myself am anxious all the time, but let's work hard enough to enjoy the experience of overcoming these anxieties! I tried to motivate them.

Secondly, although it may sound a bit formal, it is important to clarify the "position" of each company involved. For example, MSTP's position was to "maximize the efficiency and quality improvement of its quotation and ordering process," while our company's position was that while we wanted to create the best product for MSTP's initial users, we "could not provide them with overly specific functions" in order to expand the number of users later on. We wanted to create the best product for MSTP's initial users, but we also wanted to expand the number of users later on.

These "differences in position" were not only due to differences in companies, but also due to differences in positions and the nature of the transactions they were in charge of, which sometimes led to heated discussions in defining requirements. Even so, the project members tried to discuss the issues as much as possible until they reached a consensus, while respecting the differences in their positions.

**In the end, I think we were able to design a product that everyone involved was satisfied with. What were you conscious of when designing the product with the involvement of the intended users?

Seita: It's a mentality, but I think the key is to pick up even the smallest voice. Among the MSTP project members, there are those who are good at communicating in words what they feel are the issues and the functions that provide solutions, and those who are not so good. If the product design is biased toward the opinions of those who are good at it, it will not be a product that users with subtle differences in business procedures can utilize.

A typically quiet member might say, 'If we design it this way, it might not work well for the transactions I'm responsible for...' and then bravely voice their concerns. Sometimes I actually thought, "We were just about to come to an agreement, but.... However, I believe that because we made an effort to pick up on such small voices and address them, none of the 10 project members left the project and we were all able to welcome the release of the service together.

Inui: I have been working with the project members since February 2022, opening the workflow and deciding on specific requirements, and I can see the change in the mindset of all the project members, and I can see the importance Seita placed on facing each person's voice and refining the product. I could see the change in the mindset of the project team members, and I felt that it was a reflection of Seita's emphasis on refining the product by listening to each individual's voice.

Seita: They also said that they had never been conscious of how their work flowed and how it differed from that of their neighbors, so I think that what they gained during the development process must have been significant.

Seita: While all the project members made great contributions, I think the introduction of PaSS-Portal is a story for the whole MSTP company. How did you approach the management on whether or not to introduce or develop PaSS-Portal?

Seita: This was a really difficult issue, and since the theme was the digitization of field operations, we had a hard time choosing the right words to express our feelings and make them understand. However, the fact that 23 sales teams (about 200 people) from the entire Piping & Machinery Division decided to use the system in the first year is not because of anything special I did, but rather because the 10 project members' passion and willingness to take on new challenges pushed the executives to do so.

Dry: How did you proceed with the actual introduction of the system?

Seita: Together with the project members, I visited all the teams and talked to them. What we tried to do was to tell everything without hiding anything. I may be overthinking it, but I tried to emphasize that "this is your project, being undertaken on behalf of your colleagues," and to answer all the questions and concerns that I had, so that there would be no misunderstanding that "this is something that some people at the head office got excited about and decided on their own, isn't it? It has now been less than three months since we started using MSTP, and we are very happy to see that each of our sites is actively using PaSS-Portal.

Released in 1 year and 3 months. The secret is to "clarify the theme and goal by dividing it into phases

Inui: Seita-san, you were in the role of product owner for PaSS-Portal.

Seita: I had a lot of discussions with Inui-san about what the value of the product was, how it differed from other services, who the target audience was, and what problems it would solve. What gradually became clear was that we needed to cover the entire transaction process from start to finish, including quotation, order receipt/placement, delivery, and invoicing.

I myself was thinking of starting small, limiting it to quotation work, but at the strong request of the project members, we decided to design a product with functions for quotation, order receipt/placement, delivery/invoicing, and chatting. This was a very big decision that required a huge amount of design work, but looking back on it now, I think that the fact that we were able to incorporate a product that provides this customer experience from a Minimum Viable Product (MVP) was one of the most appealing features of PaSS-Portal. I think it was one of the most attractive features of PaSS-Portal.

Inui: While MVPs are often noted for delivering value in their most basic form, in this case, the minimal viable product provided comprehensive transaction capabilities from start to finish. What do you think was the key factor that enabled you to realize the service from conception to release in only one year and three months?

Seita: One key factor was dividing the project into distinct 'phases' and setting clear themes and goals. This approach ensured that everyone involved shared the same understanding that we would not let the project drag on indefinitely. Phase 0, which focused on the planning concept and team building, lasted four months from October 2021 to January 2022; Phase 1, which focused on the concrete realization of the concept and trial calculation of its effects, lasted three months from February to April 2022; and Phase 1.5, which involved reaching an agreement and decision on whether to develop the project, lasted one month in May of the same year. The time frame and goals were clarified as follows.

The second reason was that ROUTE06 did its best to meet our request to start using the system for business operations in January 2023. The speed with which they completed the development of the product, including testing, in seven months, which included all the functions of the transaction series, also contributed greatly to our success. In addition, Inui did not just "accept" the functionality requests raised by the project members, but rather, after digging deeper into the essence of the request and its impact, he proposed the best implementation method from among multiple options. He also carefully explained the pros and cons of each option and the degree of difficulty of implementation, which made it easy for us to make a decision, and we believe this was a major factor in the speedy product design and development.

Inui: Whenever we received requests from project members or people actually working on the project, we discussed with them what was behind the request, how to solve it fundamentally, or what should be covered in operations.

Seita: It was all a series of such discussions.

Inui: During the weekly meetings, we would identify the issues to be discussed, and then we would discuss what we would do about this function or this requirement. Thanks to all the discussions, each project member could talk about the product in his or her own words, and Seita himself could deeply understand why this feature was chosen.

Suppliers, distributors, and buyers, toward a trinity platform

Inui: Now that the product has been released, you are in the process of testing it in actual operation.

Seita: I am relieved to see that the product is being actively used at all of MSTP's offices in Japan. We receive requests for functional improvements from users on a daily basis, and we are working hard to respond to them, but just the fact that we are receiving such responses is proof that they are using PaSS-Portal and that they are looking forward to the increased convenience. I am very grateful for that.

One of the unexpected responses we have received is that many people feel it is a great advantage to share and accumulate the progress and history of projects within the company. I had imagined that many people in the piping equipment trade are craftsmen who "only become a professional when they accumulate experience on their own," as the trade is a highly specialized field. I was surprised to learn that there are many people who find value in strengthening the organization and flexibly assigning roles through information sharing, and I feel a positive response.

Inui: What kind of vision do you have for the future as you further refine your products?

Seita: Our current challenge is to increase the value of PaSS-Portal for MSTP by having MSTP suppliers use PaSS-Portal. Since we started working on the concept, we have interviewed suppliers of piping equipment such as fittings and valves, and have received many positive comments and supportive feedback. We have heard that not only distributors like MSTP but also suppliers are facing issues such as complicated manual work and paper-based management, and we would like to help them determine how to use the system in a mutually convenient way and start mutual use together with each company.

We would also like to make PaSS-Portal widely known and considered for use by potential users who, like MSTP, are interested in digitalization of quotation and order receipt/placement. If you are doing business with the same suppliers as MSTP, we believe that it will be mutually beneficial for both parties to be able to see the transactions requested by MSTP and those requested by other users on the list of transactions. Our goal is to create a world where many distributors and suppliers, regardless of industry or products handled, are connected through the PaSS-Portal.

In terms of functional expansion, we envision the evolution of PaSS-Portal into a platform that links not only current distributors and suppliers, but also buyers, or customers for distributors. We have begun to consider what functions should be provided in order to create a place where buyers, distributors, and suppliers can work in unison and comfortably promote transactions in a one-stop manner.

Be aware that you are a "beginner" when you start a new business

Quan: What do you think is important for a major company to consider when launching and refining a product as a new business or service?

Seita: Rather than the size of the company, I think it comes down to "thoroughly listening to the voices of potential users," as a matter of course. In our company's long history, we have launched many new businesses, but as we work on new businesses and services, we must be aware that we are always "beginners" in this area, and that we cannot simply create what we want to create and expect people to use it. I believe that we must be aware that we cannot just make what we want to make and expect people to use it.

We must first focus on creating products that people are willing to pay for and use, and I believe that the best and shortest way to achieve this is to "talk to people who are willing to use our products. After establishing this as our unwavering axis, I believe that bringing additional ideas to the table, proposing and discussing such features, will lead to the provision of value that exceeds the expectations of potential users. I believe that any new service, and whether B2C or B2B, will ultimately be used by a specific individual. I feel that it is important to imagine the faces, actions, and thoughts of the people you want to use the service and how clearly you can incorporate them into the design of the service.

Inui: I also feel that Seita was very conscious of the value of what kind of service he was providing and to whom, and that he went to talk to the people he wanted to use the service and worked in the same direction as the people involved.

Photo by Hiroaki Otake