Today's DICE events are about to kick off with Mr. Jun Takeuchi, creative director & producer on Resident Evil 5. His presentation, which should last around 30 minutes, will cover Japanese game companies and its efforts to get into the Western market. I saw a sneak peak of his PowerPoint slides as they made sure they were functioning. There's humorous clip art in my future. Sadly, I cannot take pictures of the presentation.
Capcom has had a lot of success with the Western market in recent years and I can't think of another Japanese third-party publisher that has the same level of success. Square-Enix is trying to get into the Western market, but its strategy appears to be focused on acquisitions.
We're set to start in about five minutes so keep refreshing the story for all my updates. Come along with me!
9:22 AM - The presentation begins with opening remarks from Joseph Olin, president of the Academy of Interactive Arts and Sciences. The annual golf tournament raised $500 for the Randy Pausch Scholarship Fund. The golf tournament was sponsored by EA and made use of micro-transaction donations to raise that amount. Joseph is laying out the day's events so I'm going to take this time to finish my tea.
9:41 AM - Time for Takeuchi-san! The presentation will be spoken in Japanese and translated. It's called "Un-Japanese Games: Creating Entertainment for a Global Gaming Audience." He intends to talk about Capcom's success in the West.
9:45 AM - "Japanese people view the West as a place that is defined by its non-Japaneseness." This comes from the "isolated island country complex." He talks about how Westerners view the Japanese: glasses, suits and ties, tourists with cameras, sushi, samurai. Despite the differences in culture, Capcom wants to sell its games outside Japan.
In the global games market, Takeuchi-san admits that Japan is becoming a small market. Japan ranks 6% of the total global market in game software. Sales are made in North America and Europe. Capcom has been proceeding with the goal of hitting the US and Europe as their main market to account for 70% of their revenue.
9:49 AM - Time to talk about some mistakes they've made along the way:
- We just have to understand how foreigners think! (If we can get some of our developers to die their hair blonde, their games will sell outside of Japan). This strategy resulted in Onimusha 3... you know, the one with Jean Reno. The series was well received, but didn't sell particularly well around the world. They thought that by putting a Hollywood actor in the game, it would sell well around the world. "Didn't really work."
- Making games for the US market = success in the Major League! Now, they decided to imitate other Japanese people that were successful in the US. They put baseball caps on their developers like Ichiro. The game that was made based on this strategy was Shadow of Rome. During the development of this game, Capcom sought the advice of foreigners. This was received poorly, as well.
At this point, Capcom was struggling to find a way to succeed in the West. Capcom's new strategy was not only to know its enemy (we're the enemy in this situation), but to know itself even better.
Cultural problems facing Japan for interfacing with other nations are:
- A homogenous society
- A culture that only speaks Japanese
- Restricted communities
It realized that Japanese people actually enjoy many different cultures. They listen to iPods, watch Hollywood films, eat at McDonalds, drive Mercedes Benz cars, and listens to Rock'n Roll.
9:57 AM - Although the culture is a bit restricted, they have much contact with other cultures. So why can't it make games that other cultures enjoy?
Capcom identified three problems:
- "Risk reduction can actually increase risk - concentrating investment on the Japanese domestic market to reduce risk inhibits technological innovation." It was looking at games that couid at least succeed in Japan to make its money back. However, Japan's smaller market reduces the amount of money that could be spent on development.
- "Misunderstanding the Western Market - A philosophy of thinking that it's enough just to make characters and game worlds based on Western tastes. Thinking too simply so as to reduce costs and avoid risks." It would have to make small changes that would result in big increases in sales in the West, without increasing the budget. An example of this would be taking a stylish Japanese character and turning him into a "macho man."
- "Management focused only on selling more copies - new technology is developed blindly, without a proper goal in mind. The failure to manage development is widening the technological gap between the West and Japan." Thinking that as long as the game made its money back in Japan, anything it sold in the West would be a bonus. As a result, developers didn't have a clear goal.
10:02 AM - Capcom's Ten Commandments of Capcom Development - the secrets to Capcom's current success:
- Keep staff turnover under 10% per year
- Maintain the ability (and cash reserves) to increase personnel by 10% each year.
- Keeping the first two points in mind, keep development cost fluctuations within 10%. (The top three focus on the Japanese desire for job stability. Workers like to stay within a single company. This requires companies to come up with creative ways to keep talented staff for many, many years. Japanese developers view switching companies as a big risk.)
- Investment in new IP must be kept within 20% of total development budget. (Although Capcom has many big franchises, it feels successful in creating new IP's like Lost Planet and Dead Rising. They were both developed with the Western Market in mind. However, it believes new IP spending should be kept under 20% because the company can be damaged severly if a new IP doesn't take off.)
- The structure and organization of the company needs the flexability to change in response to growth; goalds and objectives must be constantly reviewed.
- Goals and objectives must be adaptable to external forces. (Japanese companies hate structural reform, but they recognize that the first 4 items on this list require them. He talks about Square-Enix's franchise Dragon Quest, which is a good example. Square-Enix responded to shifts in the market by putting the franchise on the Nintendo DS. This is the ability to respond to market forces is important to Capcom. Can someone say RE5 on the Xbox 360? I can.)
- Objectives and aims must always be set from the top down.
- Reform must always be undertaken from the bottom up. (Developers must strive to bring reform, while the management changes goals based on their staff.)
- There shouldn't be any taboo areas when it comes to reform; reform must be undertaken at all costs. (Learning from Toyota, problems within development teams will cost the company the most money. Management and developers should create a problem-free environment.)
- Don't set unachievable targets. (Aim low! This is still a problem that occurs between management and developers. Lofty goals can actually bring developers down.)