How to Maintain the Strength of Japanese Industry :Responses to the IT Revolution and the Future of Manufacturing Technologies

ABSTRACT

One feature of Japanese management systems is excellent information sharing conducted within and between companies. For example, through the sharing of information regarding problems by members of production divisions, the quality of products has been improved. Additionally, close cooperation between development and production divisions has created outstanding production technology. Furthermore, production efficiency has been improved by having parent companies share information about production with affiliated and allied companies from which parts and materials are ordered.

This information-sharing structure was critically lacking in American companies in the past, and had become a characteristic strength of Japanese companies. Beginning in the 1990s, however, American companies used IT to refine and develop the mechanisms of information sharing that they had learned from Japanese companies. Now, ironically, Japanese companies are faced with the necessity of learning from their U.S. counterparts. In other words, Japanese companies must utilize IT to maintain and further develop the strengths that have sustained them up until now.

In business to business (B2B) transactions, companies face issues of improving the efficiency of distribution and procuring parts and materials over the Internet, while in business to consumer (B2C) transactions, companies must rapidly assess the needs of consumers and develop networks that can answer these needs. Additionally, it is vital to introduce knowledge management within companies in order to share useful information and know-how. Furthermore, where possible production technology should be replaced by digital technology and machinery, and skills and know-how that cannot be replaced should be taken over efficiently through the use of knowledge management.

Other issues Japanese companies must face include establishing core competence, improving customer satisfaction, and utilizing outsourcing. These points were key to the business strategy of one particular Japanese company with high international competitiveness (and one that possessed the number one market share worldwide). Increasingly, it is necessary for the majority of other companies to learn from such strategies.

Introduction