Japanese High-technology Firms Research Articles

Too Much of a Good Thing? Quality as an Impediment to Innovation

The belief that there is a positive link between quality and innovation is widely shared among quality professionals. Yet the experience of Japanese manufacturing firms, who are well known for their high standards of quality performance, casts doubt upon this relationship. In fact, the inability of some Japanese high-technology firms to introduce radical and disruptive new technologies is in part due to the emphasis they have placed on product quality. By delaying the introduction of new technologies until their quality could be assured, they lost out to American firms who were willing to introduce new products and service features that met the needs of consumers, even though they were not free from deficiencies, such as Apple9s iPod. Using three major case studies from the Japanese hightech sector, this article analyzes what kinds of innovation might be undermined by a focus on quality and explores its managerial implications.

Do competitive strategies drive R&D?: An empirical investigation of Japanese high-technology corporations

This paper is an empirical study of the effects of competition strategy on research and development (R&D). Analysis of survey data from Japanese high-technology firms in consumer electronics, communications, precise machinery, and pharmaceuticals showed that the competitive strategies directed toward higher added-value and product differentiation exerted more impact on R&D than that aimed at cost leadership, and that strategies with broad market ambits were more important. We also found R&D to be fairly well integrated with strategic management. In sum, to enhance competitive advantage, Japanese high-technology companies tend to exploit R&D to create differentiated products with high added-value to supply a broad range of markets.

Turnaround strategies of American and Japanese electronics corporations: How do they differ in formulating plans and achieving results?

Greater competitive and economic pressures have made corporate turnaround strategies critical to the survival of many high-technology international business organizations. The traditional differences between American and Japanese firms in the areas of human resources, production, finance, and marketing have recently appeared to converge on some common strategies employed to reverse an adverse corporate situation. American and Japanese high-technology firms are examined in terms of the antecedents, actions, and results of varying levels of turnaround strategy implementation. Survey responses from American and US subsidiaries of Japanese electronics firms illustrate that significant differences exist among levels of strategy implementation in assessing the need for a turnaround strategy, the actions taken to reverse an adverse situation, and the relative success of the actions. In addition to greater capacity utilization, low turnaround plans are generally enacted by redesigning the product or process, but successful high turnaround plans are implemented most often by gain sharing or profit sharing, as well as by eliminating unprofitable products. American firms achieve greater return on investment, operating profit margin, and cash flow, but lower sales growth and less unit labor cost improvement than Japanese corporations. These results are discussed for managerial insights into the strategy formulation process of international high-technology firms for successful competitive advantage.

Teamwork barriers in Japanese high-technology firms: The sociocultural differences between R&D and marketing managers

Building and maintaining internal harmony is a fundamental concern for managers in many Japanese firms. Discussions of Japanese management practices often point to the intense socialization of new recruits, the rotation of employees through different functions, and the significant role of seniority in determining salary levels and promotions. Considering this emphasis on harmony, can we reasonably assmme that the orientations of Japanese R&D and marketing managers do not differ in any ways that may pose significant barriers to teamwork between their departments? X. Michael Song and Mark E. Parry test this assumption by examining the sociocultural differences between R&D and marketing managers in Japanese high-technology firms. Using responses from both R&D and marketing managers in 223 firms, their study groups the respondents' employers as either low- or high-integration firms. They examine the sociocultural differences between the R&D and marketing managers in the study along five dimensions: time orientation, bureaucratic orientation, professional orientation, tolerance for ambiguity, and preferences for high-risk, high-return projects. Contrary to expectations, the responses reveal several significant differences between the R&D and marketing managers in this study. Compared to their colleagues in marketing, the Japanese R&D managers in this study generally have a stronger preference for high-risk, high-return investments. The R&D managers in the study also have a longer time orientation than the Japanese marketing managers. However, marketing managers from the high-integration firms in the study have a longer time orientation than their counterparts in low-integration firms. Compared to the R&D managers, Japanese marketing managers in the high-integration firms studied have a greater tolerance for ambiguity. And relative to managers in low-integration firms, marketing and R&D managers in the high-integration firms in this study typically have a more bureaucratic organization. Perhaps most important, a significant number of R&D managers in this stud perceive the marketing managers in their firms to have higher organizational status. Specifically, responses from R&D managers indicate that they perceive their marketing colleagues to have higher salaries, more power, and brighter career prospects. Such perceptions may foster morale problems among R&D professionals in these Japanese firms, and thus require management intervention to ensure that R&D performance does not suffer.

Innovation strategy and the R&D-marketing interface in Japanese firms: a contingency perspective

This study proposes a contingency model suggesting that a firm's strategic position will affect cross-functional involvement and information sharing between R&D and marketing departments in five major new product development stages, as well as the quality of R&D-marketing relations and organizational structure. To test the model, the authors surveyed 274 R&D managers and 264 marketing managers in 315 Japanese high-technology firms. The results indicate that, contrary to anecdotal suppositions of Japanese firm homogeneity, Japanese firms differ among themselves and among the strategic types in several important ways. The results also suggest that the level of R&D-marketing integration should be contingent on new product development strategy, making uniform promotion of cross-functional team integration questionable. Despite the differences in innovation strategy pursued by aggressive new product developers versus nonaggressive new product developers, all three strategic types rank the stages of innovation in a similar manner.

How the Japanese Manage the R&D–Marketing Interface

Many studies of new product success and failure indicate that the level of R&D--marketing integration critically affects new product success rates. In this context, R&D--marketing integration refers to the extent to which marketing and R&D share information, as well as how closely R&D and marketing work together on specific new product development tasks. Recent studies have identified a series of conditions that can facilitate or hinder R&D--marketing integration. These include: The quality of R&D--marketing relations, organizational structure, senior management attitudes and actions, and the organization of new product activity (1,2). Do these same factors affect the level of R&D--marketing integration in Japanese high-technology firms? The answer to this question is important for two reasons. First, recent reports in the business press observe signs that the Japanese are beginning to surge past the U.S. in creativity (3). Second, some authorities on Japanese new product development practices have argued that, relative to their counterparts in U.S. firms, Japanese marketing and R&D departments experience less interdepartmental conflict (4). Unfortunately, we know less than we would like to about the R&D--marketing interface in Japanese firms. In part, the gaps in our knowledge arise from the fact that most explanations of Japanese practices rely heavily on anecdotes and case studies. As a result, we have snapshots depicting the practices of individual firms, but little feel for whether these snapshots accurately describe the practices of the larger population of Japanese firms. To provide a better understanding of the determinants of R&D--marketing integration in Japanese firms, we surveyed 411 Japanese R&D managers in a variety of high-technology industries. We asked respondents to indicate the level of integration in their own division and to provide information regarding management practices in their division (see box, page 34). The data provided by the 274 Japanese R&D managers who responded to our survey indicate that new product programs in high-integration Japanese firms are more successful than similar programs in low-integration firms. Our findings also indicate that the level of R&D--marketing integration in Japanese firms is influenced by the quality of R&D--marketing relations, the organizational structure of Japanese firms, and by the attitudes and actions of Japanese senior management (Table 1). (Table 1 omitted) Surprisingly, however, our analysis revealed few differences in the ways that high-integration and low-integration Japanese companies organize their new product development activities. R&D--MARKETING RELATIONS Studies of new product projects in U.S. firms have reported that new product success rates were highest when R&D--marketing relationships were harmonious, meaning that party had great professional regard for the other, each felt that the was competent in their respective areas, each felt dependent upon the other, and each felt very trusting and open toward the other (5, p. 71). This mutual respect and trust affected the nature of R&D--marketing interactions, the timing of joint involvement, and the resolution of interdepartmental conflicts. Our data suggest these same factors affect the level of R&D--marketing integration in Japanese high-technology firms. 1. GIVE-AND-TAKE INTERACTIONS.--Various descriptions of Japanese management practices leave the impression that, regardless of the level of R&D--marketing. integration, employee interactions typically involve respect, commitment and the recognition of shared dependence. In part, employee interactions in Japanese firms reflect the fact that the ability to work well with fellow employees is the most important criterion for promotion decisions (6). By encouraging employees to consider the implications of current interactions on future relations, lifetime employment practices may also spur harmonious relations and reduce conflict(7). …

R&D-marketing integration in Japanese high-technology firms: Hypotheses and empirical evidence

The authors review studies of U.S. high-technology firms and hypothesize that, in Japanese high-technology firms, the perceived level of achieved integration reflects perceptions of organizational structure and climate. To evaluate these hypotheses, the authors examine the perceptions of marketing managers from 264 Japanese high-technology firms. Findings indicate that managerial perceptions of information-sharing and integration in budgeting were negatively correlated with perceptions of formalization. The authors also find that perceptions of information-sharing and integration in the early stages of new product development were positively correlated with perceptions of employee participation in decision-making and with perceptions of the value placed by senior management on R&D-marketing integration.

The R&D-marketing interface in Japanese high-technology firms

Gupta, Raj and Wilemon [11,12] have examined the R&D-marketing interface in US high-technology firms. X. Michael Song and Mark E. Parry explore the generalizability of those findings to Japanese high-tech firms, specifically, comparing the perceptions of 223 Japanese R&D and marketing managers regarding activities that require R&D-marketing integration, the level of achieved integration in Japanese firms and the types of integration related to variations in new product success rates. Their analyses reveal a number of consistencies between the perceptions of US and Japanese managers.

Factors influencing Japanese entrepreneurs in high-technology ventures

In this study reporting on a survey of the founders of Japanese high-technology firms, various factors affecting the entrepreneurial event are examined. The sample was drawn from the Nikkei Press Group, which publishes, in Japanese, an annual directory of over 1,700 “high-technology” venture business firms. A close examination of this directory reveals that there are only between 100 and 200 firms that are both high technology and less than 10 years old. From this list, 100 firms were selected for a single mailing of a Japanese-language questionnaire. Forty-six completed questionnaires were returned. The survey consisted of eight questions, six of where were multipart questions. While the “push” of a displacing event seems to be relatively unimportant among Japanese high-technology entrepreneurs, there appears to be a strong relationship between social marginality and entrepreneurs with a perception that they “had no alternative” but to form a new venture. The “pull” of opportunity was mostly related to a specific deal or a niche ignored by former employers. The importance of friends in the decision to launch a venture appears to be quite strong, reflecting the strong group spirit of Japanese society. The dominant element in the motivation of high-technology entrepreneurs in Japan seems to be related to a drive for self-actualization. The following five variables generated the strongest affirmative reactions: • Create an opportunity for myself • Create an organization that reflects my values • Reached a critical point in my life • Create an opportunity to grow and develop my talent • Unable to exercise my full creativity in previous position This may reflect that basic human needs are well met by the Japanese economy and the centuries of Japanese social and ethnic continuity. It is not entirely clear from this study where Japanese high-technology entrepreneurs find “role models.” Only a few had fathers who were entrepreneurs, although 43% had fathers who were either entrepreneurs, farmers, or otherwise self-employed. Observing colleagues or others form companies played only a limited role. However, 83% of the founders acknowledged that their firm was a “spin off” from their previous employer. The founders of these “spin-off” ventures were predominantly employed in R&D and sales and marketing. Holding a position of authority was strongly associated with spin-off ventures in Japan. About as many high-technology entrepreneurs came from large companies (over 1,000 employees) as from small (250 employees or less) firms. While it is commonly perceived that the cultural environment of Japan restrains entrepreneurship, most of these entrepreneurs saw their environment as favorable, which may reflect the Japanese will to endure hardship or a universal optimism among entrepreneurs.