Innovation Management of Japanese and Korean Firms: A Comparative Analysis

Abstract

The innovation management of Japanese and Korean firms is analysed from a comparative perspective. A review of aggregated statistical data reveals that corporate research and development (R&D) in Korea is concentrated to a higher extent on a smaller number of firms and industries than in Japan. A broad analysis by managerial field shows that high investment into the development of new technologies and the adoption of advanced R&D management practices are common among Japanese and Korean firms. At the same time, however, various differences set them apart. Japanese firms tend to be conservative and Korean firms tend to be risk taking in their technology strategies. Korean firms rely to a higher extent on external technology from overseas than Japanese firms. Japanese firms focus on the early involvement of suppliers in R&D activities, whereas early design activities have a high priority in Korean firms. Finally, the transition from stable, seniority oriented towards flexible and performance oriented human resource management in innovation-related areas is more rapid in Korea than in Japan.