Restructuring Japanese Business
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1 Restructuring Japanese Business Models in Global Arena Kiyoshi Kobayashi Graduate School of Management Kyoto University USJI Workshop March 20, 2013
2 Economic Growth OECD 1.68% twice in 2050 Non-OECD 2.47% five times in countries will become middle class countries among 224 countries and regions
3 20 th century world economic regime polarization at o : few developed e countries and many developing countries 21 st century world economic regime a large number of middle class counties competing each other to transform toward developed countries
4 20 th century regime comparative advantage of developed countries: knowledge production, product cycle theory 21 st century regime globalization of knowledge workers markets diminishing comparative advantage in knowledge production between developed countries and developing countries What is the comparative advantage of developed countries?
5 Business Model Middle income population of developing countries will be 1.2billionby Larger than the total population of US, EU, and Japan Model a: one-size-fits-all standard Model b: one-finds-own-size standard
6 Commoditization Galapagosization
7 Architecture Modular form architecture t Because the module that is part of each has features a self-contained, but also formed a product gather a posteriori the parts that had been designed separately in advance, it is a product worthy as a whole. integral architecture The delicate balance between the parts as a result of a number of inter-granular design parameters were adjusted to provide the product as a total system.
8 To demonstrate t the technology with fine tuning Japanese companies, has created the world's preeminent Integral product. In standardization competition based upon modularity Japanese companies lost their competitiveness. Standardization by modular competition, commoditization of product technology will continue. Integral Architecture based on the module. customization based on the local context of the local
9 Two-sided markets markets where platforms enable interactions between end-users, and try to get the two (or multiple) l sides on board by appropriately pricing each side (Rochet and Tirole, 2003) System competition (Silicon Valley/Hollywood model) Self-destruction process of markets Standardization (dialog innovation) Dialectic innovative markets (Moe model) many creators, deep specialization small-sized markets
10 Talent Creative class (by R.Florida) technology tolerance Silicon valley/hollywood model tolerance for getting g new talents Moe means "a rarefied pseudolove for certain fictional characters (in anime, manga, and the like) and their related embodiments. Moe model - tolerance for getting reputation copy-tolerant models (open, quick evolution)
11
12 Original 3D figure Deformation Coslpay Miku Hatsune 2D character image
13 Cosplay and Racing team 3D figure Original Animation
14 Cost Structure t (Uni clo) Profits 8% Shop revenue 34% H.Q cost 10% Loss 20% Manuf.cost 20% Transportation cost 5%
15
16
17 Time-Space Management
18 Market size Advanced Long tail model Contents markets Positive/greatest profits are obtained from a success work. Therefore, intellectual property p management is also important. -> Hollywood model do not have variety. The break-even point of Hollywood The break-even point of Japanese Major Comics Magazine The break-even point of selfpublished comic book variety/diversity
19 cook-one's-own-food market Producer=consumer complex Comiket (self-published comic book fair) Comiket 76, 2009, 560,000 attendees The sales of a self-published comic book are over 10 billion yen(100 millions euros).
20
21 KAIYODO ( 海 洋 堂 ) Japanese company dedicated to figurines and garage kits. Revoltech is a portmanteau for "Revolver Technology," in reference to the unique "Revolver Joint" articulation which all of the figures in this particular series utilize. This gives the figures a wide range of motion and stability, allowing for many dynamic and varied poses. Asura(God of a battle of ancient India) Figure overall height: 140 mm Movable part: All the 33 places 3800 yen (38 euro)
22 Participants are 40,000 or more people, and sales are 3 billion yen (30 million euro) or more in one day.
23 Dialectic creative process innovation knowing suppliers customers Common knowledge evaluation Shinise (Ryokan, Gion,) Food (Sushi, Kaiseki) Art and Culture (entertain., tea, flower) Public services 文 化 伝 統 歴 史
24 Traditional Dining
25
26
27
28 High context type service Genetic inheritance of core concept HQ Common structure Duplication of standardized services Iemoto (meta model) HQ Japanese service Asymmetric relations Inheritance of core competence service Front office service Front office customers customers
29 communication static Customs, norms Context free service High context communications Tacit rules Coherent values コヒーレントな 価 値 観 持 続 的 で 毀 損 しにくい 価 値 の 源 泉 Japanese services standardization dynamic scalability efficiency POS CRM Low context communications Globally common consensus
30 omonpakari Model Knowledge Interaction (Ad hoc) Service Consumer Interaction Runtime Role Model Dualitybetween service provider and consumer High Context Information (Culture, History, Lifestyle) Service Provider Proactive Anticipation
31 Value creation of high context service Dialectic value creation 客 Approach Perceived Feedback Orientation Quality Satisfaction Loyalty 店 High Change for Better Context Better Quality Sales Longevity
32 Multi context model ー Context-dependent model: Edomae-sushi Context-type: High maturity level Consumer Role Model High maturity Common Knowledge Base Enter Order without menu Shift to low maturity level if the consumer can not recognize Role Model High maturity Provider(waiter) Menu 1 Menu 2 Menu 3 Menu 4 Menu 5 Eat Check Exit Role Model High maturity Provider(Chef) Common Knowledge Base: Edomae-sushi
33 New creative society (cook-one's-own-food one's o n economy) Creation & Reputation (C&R) The new concept replaced with R&D In the new creative society, the whole quality is enhanced by very various participants creating contents and criticizing(reputation) with each other. Learning through interaction
34 Asia Business Leader Training Project March, 2013
35 Objectives Countries Training Term Contents t GSM-KU will develop efficient human network with top business schools and government organizations in Asian region. Taking advantage of the human network, GSM-KU gives quick training for potential Asia business leaders who can conduct business effectively in Asia, and develop educational curriculum and materials for the training. India, Philippines, Thailand, China, Vietnam, Indonesia, Malaysia, Japan 1 year Half year lecture / practice GSM-KU Lectures will be given at Tokyo or Kyoto, by the overseas invited lecturers from partner business schools and government organizations in Asian region. Optional business-oriented English training will be given in Makati, Philippines. Half year Field Research (Internship) KBRC Collaborating with business schools and government organizations in Asian region.
36 Qualification for Asian Business Leader <Strengthen Core Competency> Module1 Cross cultural communications Business Ethics CSR, Environment Public Relations Business Identity Basic Knowledge and Expertise for Global Business (Local conditions, Social institutions, Strategy building, Innovation, Case analysis) Human Resource Development (HRD), Rebuilding an Organization Structure and Promotion <Training Advanced Competency> Module2-3 Insight for the future Society and Vision Creation Business Writing Communication and Negotiation Skills
37 Asian Business Schools & Government Organizations Network (2013) Major companies Major companies Government Organizations India IIMC Research Institutes Major companies Government Organization s Research Institutes China CEC Thailand CBS Government Organization s Research Institutes Major companies Government Organization s Philippines UP / Ateneo University Japan Kyoto University Malaysia IIUM Major companies Government Organization s Research Institutes Research Institutes Major companies Government Organization s Indonesia UI / ITB Vietnam UTC / Hanoi University of Foreign Trade Major companies Government Organization s Research Institutes Research Institutes
38 Asian Business Schools & Government Organizations Network (2014~) Major Companies Major Companies Government Organizations Japan GSM-KU Research Institutes Major Companies Government Organization s Philippines UP / Ateneo University India IIMC Government Organization s Major Companies Government Organization s Research Institutes Vietnam UTC / Hanoi University of Foreign Trade Asian Business School / Government Organization Consortium Thailand CBS Research Institutes Major Companies Government Organization s Research Institutes Research Institutes Major Companies Indonesia UI / ITB China CEC Major Companies Government Organization s Research Institutes Major Companies Malaysia IIUM Government Organization s Research Institutes Government Organization s Research Institutes
39 Asia Business Leader Training Project Study Environment Language Training (English & Local language) Module 0 (optional) (Business English) (Makati, Manila) KBRC International Network CBS IIMC Logistics Support Module 1 (Tokyo) GSM KU UTC Advice on Field Research Support on Site Module 2 (Makati, Manila) GSM KU Field Research (Internship) KBRC Module 3 (Kyoto) GSM KU Collabora atio n CEC UI IIUM UP (China Enterprise Confederation) ITB (University of Indonesia) (International Islamic University Malaysia) (University of Philippines) UAT Grow up Asian Business Leaders active and respected in Asian countries Human Resource Development Network to Strengthen Japanese and Asian Companies
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