What happens in Japan Society?

We IISIA has dedicated to the social contributions these years such as to provide free information literacy education for the university students not only domestic but also overseas via the online course or internship etc., People may be wondering that why we make our effort to promote such activities. We would like to spend few months from now on to tell our belief and real performance of our social contributions. Firstly, I would like to introduce the origin of our belief based on the book of “why the elite who operate this world use this frame work?” written by Mr. Harada, the CEO of Institute for International Strategy and Information Analysis, Inc.

Have you ever been aware of some special “atmosphere” when you walk around the factory floor of Japanese manufacturers? Isn’t the anxiety and frustration of “just make, but unsalable” floating around? What is happening?

Look at a real story. A very famous American company one day called a Japanese manufacturer to ask them to develop a part for them. The Japanese manufacturer, of course agreed and made their every effort to complete it. Once they have finished the development, the American company just told them that a Taiwanese manufacturer will take it over from now on and what remains to the Japanese manufacturer was a cruel price negotiation. There is still a hope if we can sell a lot… the Japanese manufacturer was positively thinking about it and signed the contract. However, it was not going well and was cut out next year. What this Japanese manufacturer finally got? The immense fatigue and the debt of development cost.

So, what exactly happened in Japan society? Let us think about the three steps of business first; the so-called “innovation, customer facing and infrastructure”. Look back again to the above story. You should be aware of the reason why the Japanese manufacturer failed. They misunderstood the offer from the America will make them get into the so-called global business, however it is only a part of “development” under the extended line of “customer facing”. They were just invited to joint into a “frame work” which is set up by the America company.

Why do the western countries value the importance of “frame work”? As the defeated sumo has to retreat from the sumo ring, the useless player inside the frame work will be only flipped. Or if the frame work itself is judged as insignificance, the whole frame work can be totally replaced and dumped without mercy. The point is who can decide it? The side of setup does. Therefore, the above story again, that famous American company set up the rules of “frame work” and has the right to change the rules, however what the Japanese manufacturer can do is struggling to follow it on and on.

Is the “frame work” the only interest for western corporations? The “agility” is the basic attitude for them to struggle for their life and death. What does the “agility” mean? Close out the unsalable goods; drive down the constant cost; and sustainable investment of global talent acquisition no matter how much the cost is for the purpose of creating new additional values. These ideas of “innovation” can not be completed until the global capital raised. At this very moment, their business transforms to “innovation + infrastructure”. Comparison with the current situation of Japanese manufacturer, where is the future?

How about the China market? Though the conflicts between China and Japan sometimes happen, the Chinese elites and wealthy class are eager to hold Japanese yen in fact. Why? What they aim is the technical power of Japan. Of course, the soaring of labor cost in major cities may wake up a retreat from china market, however the secondary cities in China are waving their hands to Japanese companies. A declining birthrate and an aging population is inevitable in Japan society and the shrink of Japanese market is visible. To make a good use of Japanese technical power to conquer the immense Chinese market and to acquire the business profit would not be a weird route for japanese business leaders.

So, the next question is how we Japanese companies survive in a global business environment? The answer is「innovation, innovation and innovation」. To compete with the agile American manufacturers under the circumstances of finance capitalism, the speed of technical development of Japanese companies as rapid as American’s is necessary. When we turn around to face the Chinese market, they will definitely ask the same「next, yes, next…」, that means the ability of continuous productivity of latest technology is required. If this kind of ability of innovation is lost, the capital flow from China to Japan will be stopped.

However, after the end of so-called “Heisei bubble”, that there is no need for innovation becomes a new trend among Japanese companies, because it means no more than cost of money and time. Moreover, innovation may bring new structures and approaches of current works, that means unemployment may happen. That is why people are against the innovation.

What is the essence of “innovation”? Honestly speaking, the innovation is so far exercised in the field of Japanese manufacturer is no more than a development of technical structure of measurements and controls under the “existent frame work which was made outside Japan”. The real innovation is to create a newborn frame work which can bring a brand-new value. Let us look deeply at it next time.

*the above content is abstracted from the book of “why the elite who operate this world use this frame work?” published in 2015. The author is Mr. Harada, the CEO of Institute for International Strategy and Information Analysis, Inc.

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