Current Issues in Japanese Management – A Second Look – “Is Japanese Software Thrust As Powerful As Their Hardware Thrust? Or Does It Really Matter Anymore?”

July 12, 2009

“The differences in approach from hardware and software are large enough at this time, that it will be difficult to gain the competitive advantage in software as in hardware. The management is well aware of this situation and will be looking in the future to rectify it. For example the new president of Fujitsu Mr. Tadashi Sekizawa (who will start his term in June 1990) has recognized the importance of software and his motto for the future is ‘Sofuto de rieki wo koujou’ (Kogyo Shinbun, 1990).”

With this remark, almost twenty years ago, I concluded (in a thesis submitted as JMP-17 student at JAIMS, Japan American Institute of Management Science, Hawaii and Sophia University, Tokyo) that the Japanese business leaders in general and Fujitsu top managers in particular were poising themselves to play a bigger role in global software market. Today, twenty years later, I want to reexamine their role in the emerging convergence of computing and communications technologies and the “Computing Cloud Service Fabrics”. It is predicted that the advent of Computing Cloud Service Fabrics could have a greater impact on business use of IT than the PC revolution did in the 1980s. While the Japanese management successfully exploited the telecommunications revolution, they missed the boat completely with the Internet revolution. What will be their role in the next networking revolution? Do the cultural issues that have played a role in the past that gave them competitive differentiation in hardware and disadvantaged them in software continue to play a dominant role?

My thesis discussed the following cultural traits and their impact on their business success:

  1. Collectivism and recognition of human element
  2. Quest for constant process refinement
  3. Growing together (Kyozon Kyoei) and specialization
  4. Role based management with long term impact (Flexibility)
  5. incorporating innovative technologies to gain competitive edge
  6. Total process integration and total human network modeling, monitoring and evolution
  7. Education and
  8. Quality emphasis

This becomes even more important with increased global emphasis in software innovation which is not a strong suit for the Japanese management. With recent global recession, is the Japanese management increasingly becoming drawn inward and move into their comfort zone which is hardware focused as evidenced by the recent goal of Fujitsu to sell 500,000 servers next year? This is in total contrast to Sekizawa’s 1990 motto quoted above.  With companies like DELL, HP and even Cisco (recently joining the fray) commoditizing the servers with virtualization, does this move amount to committing hara-kiri or is it a brilliant strategy with a totally new hardware innovation that will enable cloud computing services with real time management features assuring application availability, performance, energy and security tuning?  In fact, there is a need for next generation server and storage devices that enable real-time dynamic provisioning and management.

Obviously Japanese companies with their core competence in chips, computers (including networking and storage) and communications intact can successfully device such a strategy and leapfrog rivals. In the past, the Japanese business managers known as the “Salaryman” modeled themselves after the “Samurai” warriors and looked at business success as winning a war. Their entry into hardware manufacturing and process innovation are often cited as shining examples of their “bushido spirit”. I am currently invited to write an article on the effect of western influence and globalization on Japanese management during the past two decades since I published my thesis (under the guidance of Prof. Robert. J. Ballon of Sophia University in Tokyo), and investigate how this generation of Japanese managers will fare in a world that will be dominated by supremacy in software innovation and adoption. I am looking for input, comments and collaboration and invite anyone with appropriate insight to participate.

JAIMS is a shining example of long term vision of the past generation of Fujitsu management. Similarly, the Zen based training institute to teach the management was started by the founder of Sojitz trading company.  How will the new generation of managers fare in the future? Will they continue the tradition of long term focus of their predecessors or they also become the victims of short term profit focus and greed that has plagued the western management during the past two decades?  These are some of my research topics. You can request a copy of my thesis by email


2 Responses to “Current Issues in Japanese Management – A Second Look – “Is Japanese Software Thrust As Powerful As Their Hardware Thrust? Or Does It Really Matter Anymore?””

  1. Excellent post. Overall the Japanese have generally had a hard time coping well with innovation, creativity and fast paced adoption. That is not to say that they do not recognize this challenge. Toyota has recently stated that it’s processes need to move beyond just Kaizen to something more.

    More specifically the challenges I see happen to be with regard cultural and social. Younger Japanese are very outspoken and tend to want to move towards an idealized view of what they believe freedom and creativity means. However many of the larger established companies are not necessarily interested in this viewpoint and tend to curb these creative elements.

    However with more global social networks and mechanisms such as Twitter, the creative and innovative sides are once again growing using a different outlet that tends to encourage and not dissuade their views or approaches.

    In my opinion it is the classical striking of a balance between innovation vs. pragmatic business. In Japan this is particularly challenging in light of their decades of practiced processes that have not fully adapted to the changing world around them.

    Fascinating topic!

  2. […] Current Issues in Japanese Management – A Second Look – “Is Japanese Software Thrust As Powerf… Posted by Mikkilineni Filed in Distributed Computing, IT operation & Management, Japanese […]

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