Innovating Japan

Reigniting the giant

While most Japanese organizations recognize the criticality of innovation, many struggle to pursue innovation in a systematic way. Underdeveloped entrepreneurialism, cultural roadblocks and organizational inertia stifles innovation and undermines economic growth. In a 2014 survey of 1,000 C-suite executives and their direct reports – including 108 from Japan -- conducted by the IBM Institute for Business Value in collaboration with the Economist Intelligence Unit, we found that the most successful organizations approach innovation differently. Top organizations pursue distinct strategies in innovation organization, culture and process.

Outperforming organizations source new ideas from a variety of sources.

The IBM Institute for Business Value executive report, “Innovating Japan: Reigniting the giant” highlights how the most successful organizations approach innovation and identifies specific strategies that can help Japanese businesses innovate like outperformers.

The three key categories that separate outperformers from the rest are:

  1. Organizational structures and functions that support innovation – The most successful organizations align innovation activities directly with business objectives, pursue “open” innovation structures and create specialized innovation teams.
  2. Cultural environments to make innovation thrive – The most successful organizations maintain a clear focus on innovation across all business activities, encouraging innovative behaviors and finding ways to sustain innovation momentum.
  3. Processes to convert ideas into innovation – The most successful organizations source new ideas from diverse locations, often leveraging big data and analytics; innovation is funded separately and measured rigorously.

Japanese companies once led the world in innovation of operations, products and business models. But in many markets and industries, Japanese companies have fallen behind. The most innovative companies now come from elsewhere. However, by applying the innovation lessons of the most successful organizations, Japanese companies can reposition themselves to become innovation leaders of the future.

Download the IBM Institute for Business Value Executive Report

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