Japanese culture views technology as a tool for making marketable products. Production technology is central to such a view and has become a clear force in developing competitive advantage for Japan's industrial giants, as shown in Figure 3.1. An effective vision of next-generation products combined with continuous product improvements provide the vision for "upstream" developments. Japan's focus on production equipment and process improvements is directed towards designing for cost and manufacturability: that is, Japan's focus is on designing processes to improve productivity, increase quality, and decrease cost; designing concurrent engineering methods to speed product introductions; developing software to implement and improve factory automation; and devising effective management methods related to all of the above. The following are some of the JTEC panel's findings regarding technology R&D in Japan:

Figure 3.1. Japan's successful production development strategy.

Figure 3.2. Parallel product development strategies in Japan.

Japan has created a major competitive advantage from its development of low-cost, high-volume consumer products. This advantage is based on the effective integration of materials, production, and design technologies, as shown by Murata's model in Figure 3.4.

Figure 3.3. TDK's product development strategy.

Figure 3.4. Japanese passive component strategy (Murata).

The technological imperative of Japan's integration strategy is "cost comes first." While Japan is developing competitive technologies for high-performance products like supercomputers, it also has the leadership in low-cost, high-volume consumer products like camcorders, televisions, and stereos. That provides Japanese firms with the unique advantage of having technological capabilities in both high-performance and low-cost technologies. Low-cost, high-volume products provide the impetus to develop mass production technologies that reduce production costs while also raising production quality and volume. Increased demand for product variety has provided further incentives for Japanese firms to develop flexible assembly systems that allow development of lower-volume products at mass-production costs and quality. These systems can now be applied to a variety of lower-volume, intermediate-cost industrial products. U.S. firms have lacked adequate product volumes to invest in equivalent manufacturing technologies and are now finding it difficult to compete in higher-priced and intermediate-priced industrial markets.

Published: February 1995; WTEC Hyper-Librarian