INSIGHTS

From Point Solution to Investment Priority

Concur Japan Executive Advisor (former President and CEO) Masamune Mimura on the power of local narrative, lobbying the government and creating a feedback culture that’s a magnet for top talent

We’re delighted to share our interview with Masamune Mimura, former President and CEO of Concur Japan.  Established in 2011 as a local joint venture, Concur Japan stands alongside Oracle, Salesforce and its parent company SAP as arguably one of the most successful enterprise software companies in Japan.  Concur owns approximately 50 percent of the travel and expense solution market in Japan, according to IT market research firm ITR, and contributes more than 10 percent in Annual Recurring Revenue (ARR) to SAP Concur globally.  The company also ranks consistently as one of the most desirable companies to work for among medium sized companies in Japan.  Learn how this master marketer, sales leader, lobbyist, company culture builder and best selling author built Concur Japan and, in the process, transformed Japan’s indirect spend management infrastructure.  The interview has been edited for clarity.

Finance and HR are considered to be the toughest categories to succeed in for foreign software companies in Japan due to a myriad of local regulations.  What drew you to Concur 12 years ago?

I was in the midst of building my own mobility company, an Uber-like platform, but as I was in the midst of securing funding, Allen Miner, the founder of what is now Japan Cloud, proposed to me that I head up Concur in Japan.

Frankly, I wasn’t that interested at first.  I was used to selling integrated solutions at SAP.  Concur was a point solution focused on expenses.  “What could be more boring?” I thought. But I did some research and learned that the company was extremely successful in the U.S., so I began to think it could succeed in Japan as well.

I also came around to think that expenses, because they were so boring and something no one wanted to do, presented an opportunity－it could be improved and made less cumbersome for employees.  It was a pain point waiting to be fixed, especially in Japan, where the submission of paper receipts was a regulatory requirement.

In addition, I saw that new technologies emerging globally and in Japan, namely the smartphone and digital payments, could transform the expense process in Japan.

In the end, I was sold on the opportunity.  I sold what I had built of my company and took the job with Concur.

Concur is the dominant travel and expense solution in Japan and the largest contributor of ARR to SAP Concur globally.  How did you do it?

I put a lot of thought into positioning the company for Japan and to make expense management an investment priority for customers.

I thought expenses were too small a category to be of interest to senior management, so we moved away from positioning Concur as a point solution provider.  We didn’t want to push product.

Instead, we positioned ourselves as an enabler of “Indirect Spend Transformation.”  We created our own narrative for Japan and did a lot of PR. This caught the attention of senior management at big companies, and lowering indirect spend became an investment priority for them.  We created a movement.

We also lobbied the government to push for regulatory change.  At the time, paper receipts were still required to submit expenses in Japan, which of course didn’t work for Concur.  So we lobbied a senior member of Japan’s Liberal Democratic Party along with the Finance Ministry, to put Indirect Spend Transformation on the legislative agenda.

We conducted a survey with Japanese businesses, and they of course vouched for the digitization of receipts because it streamlined operations and lowered costs.  We then announced the results at a press conference, building a narrative about how Japan was drowning in paper and falling behind globally.  This drove press coverage and influenced legislators to ease regulations.  What we did was unprecedented－not to mention totally audacious－for an unknown, foreign software company.

The process took four years, but we succeeded in creating a regulatory environment that was favorable for Concur to do business in.

In addition, we integrated Concur with the local payment infrastructure.  Concur is built for processing expenses from credit cards.  But Japan uses other digitized payment methods as well.  Suica and PayPay are examples.  So we localized the product to be compatible with these local payment methods.

From a PR standpoint, our story focused less on the product and more on how we were building an entirely new social infrastructure, one that eliminated cumbersome expense processes and prevented fraud as well.

Finally, we focused on attracting great people by building a company culture that gives employees a sense of purpose beyond just making money.

As you may know, we’ve been ranked No. 1 on the Great Place to Work Institute’s “Best Companies to Work For” list for six consecutive years and have received the Best Company Award for nine years straight.

Our employees take great pride in the culture they’ve created, and it shows in how we engage with our customers and other stakeholders.

Could you expand on your last point?  And please tell us about your best-selling book on creating a feedback culture 

I’ve always been interested in people and building a company culture.  My interest in feedback, in particular, dates back to my days at McKinsey.  I believe that a feedback culture can drive company growth, as well as contribute to the development of individual employees.

My book, translated loosely, is called “Everyone’s Feedback Book.”  It highlights various ways to give and receive feedback, such as “Gap Feedback,” or the practice of addressing issues in a positive way; “Positive Feedback,” which of course is the ability to identify and praise good work; and “Coachability,” or the need to be open to feedback.

Growth leads to silos and company politics.  You can minimize company fragmentation if employees develop the skills to support each other.   A culture of openness and connectedness boosts morale and contributes to growth.

Currently, Concur Japan hires only 2.1 percent of job applicants.  We’ve created a positive cycle of hiring inquisitive people with a learning and growth mindset.  This drives company growth as well as financial return for employees, which further attracts great people.

What advice would you give to global SaaS companies looking to enter Japan?

It’s important to hire a country manager who’s interested in people, not just driving sales and making money.  You want to build a culture, not just drive sales.  You want to build a company that employees can own and take pride in.

Also, corporate leadership needs to respect Japan’s autonomy.  Japan needs to be its own region.  Japan is too big and mature a market to come under APAC.  Allen Miner played a big role in ensuring Japan’s independence and securing the resources that we needed to succeed.

In addition, HQ needs to support their local CEO and empower them.  Again, I’m a strong believer in Japan having its own narrative.  Marketing product alone will not resonate with decision makers at large companies.  It will not grow the business.

Finally, companies need to invest in localizing their product for Japan.  Not having a localized product is a non-starter, especially now with so many local startups entering the market.

If they focus on all these things and execute flawlessly, global companies can enjoy the huge market that is Japan.  Japan alone can generate two-thirds the revenue of EMEA.