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Issue 5: Critical Perspectives

Structural Reform For IT Competitiveness in Japan

Kei Hata
Sakushin Gakuin School

Five years ago, in order to publicize the necessity for the Japanese government to have an Information Technology policy that until then was largely ignored, as a member of the House of Counselors of the Japanese Diet, I created an urgent proposal and presented it to Prime Minister Hashimoto.

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The proposal was the fruit of discussions with top leaders in the IT field such as Prof. Jun Murai, a global authority on the Internet, and Mr. Joichi Ito, who can be called a popular figure in the field of Japanese information and communications.The document laid out the arguments for the future of Japan in the Information Technology field and made the follow points:

  1. Following the fast development of information and communications technology, Japan and the world is pressed to reexamine the structure of conventional organizations;
  2. In order to keep up with the accelerating rate of change, Japan must adopt seamless and open organizations instead of the vertically, closed, locked-up-room organizations, i.e., changing from hierarchical structures to the network type;
  3. Advancing globalization is shifting social structure in the direction of becoming smaller and more transparent;
  4. Under these circumstances, Japan suffers from system fatigue from which it cannot yet free itself and is missing out on the wave of computerization that expands on a global scale.

While it is not known whether our proposal was influential or not, during the ensuing period of five years the telecommunication infrastructure of Japan improved to match the world's highest levels, according to ITU research. Ironically, we in Japan seem to enjoy the cheapest high-speed mass information environment in the world.

Does this reflect a change in Japanese consciousness toward the smaller and more transparent social structures discussed previously? Regrettably, I must conclude the answer is "no." It is my belief that the main cause is due to a hard core of managerial positions who do not use, cannot use, or do not understand the necessity of using the Internet in this country. The best example of this is to see the lack of email addresses on the business cards of the leaders of the major private enterprises, financial institutions, and top bureaucrats.

I exchanged business cards with most of the CIOs of top IT industry companies. Email addresses were on few of their cards. Even if there were email accounts, very few tops managed them by themselves. The one exception was the chairman of Sony, Mr. Idei, who actually responded personally when I sent him an email. Even though many people in the general population use email, such usage is very low among senior managers with decisive social influence.

The spread of IT makes on-line information available to everyone, as experience in the US and elsewhere has shown, and the information is shared freely. With objective evaluation, the most effective and efficient choices can be made. Do top leaders in the political world, the business world, and officialdom who grew up in a Japanese MURA (village) society prefer this kind of highly transparent environment brought about by the progress of IT?

One might observe that those who have vested interests maintain their privileges by monopolizing information, which only they can know, and hide from their responsibilities by not considering alternative information at their disposal. It is understandable why they would not part with this privilege. Consider the bad debt problem in Japan. The solution to the debt problem is postponed without opening up the data for examination. Failing to resolve this problem has allowed Japan to fall in terms of international market competition from 1st to 30th place in 10 years, according to the International Management Development Research Institute.

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