Japan has been well known for innovation over the last century however since their heydays of the 70s and 80s. Since that time the economy has been steadily declining to the point where Japan now has a large deficit than Greece. The population is ageing and childbirth is well below sustainable levels to maintain the existing 120million population. There are very few natural resources and for the last 20 years most people in Japan have seen their wages and bonuses disappear to the point that young people are not seeing any future in working hard as there are few incentives to do so and no promises of improved conditions in site. Essentially the cultural expectation is of continual decline. On top of this Japan

Ingrained into the psyche of the Japanese people is SAFETY and this is leading to people becoming less involved in the world around them and wanting to escape into their own fantasy worlds – Otaku Culture – as it has more promise and reminds them of times where they had less to worry about and more freedom.

If you compare this to other Asian countries such as China or Korea the young people can see things are getting better and better so they get on their bike and go to nightclubs and want to be with someone to build or make a future together but Japanese on the other hand can not see this happening.

The other endemic problem is that Japan has a huge ageing population. In the 80’s there were many young people supporting a handful of older people however the pyramid is now inverted. There are fewer young people and a very large and growing aged population who need support in terms of pension, healthcare and living etc. To the point the government is currently spending almost 2.5 times the size of the current Japanese economy every year. This is already at an unsustainable level and this is likely to increase.

Is Abenomics the savior of Japan?
President ShinzōAbe is looking at ways to counteract these two key problem areas by jumpstarting the economy but is it enough? One of the main components of the Abenomics plan has been to print almost 10.3 trillion JPY in the hope of encouraging spending and also introduction of NISA’s a governmental Tax free bond program but is this radical economic plan enough? It does not deal with the more intrinsic cultural and social issues previously talked about and it also fails to encourage change in attitudes to foreign entrepreneurs which for me is an obvious move if the economy is to grow.

Japan is loved by many cultures for it’s fantastic technology, unique cultural traits and it’s top quality products and services. From my own personal experience and interaction with the young Japanese people they are ready for change and welcome foreigners with open arms. Why does the Government not incentivise the leading industry castes to act in kind and start working on change in professional attitudes to non-Japanese skilled workers. Currently it is quite difficult to even enter Japan for many countries let alone try to obtain a visa to work there. Further interest from foreign investors and entrepreneurs could be setup in the form of Tax benefits and incentives. These types of changes and intercultural interactions alone can be exactly what Japan needs to bridge the gap between themselves and other cultures and turn on the flow of innovative ideas in and out of Japan.

The other question for me is how can Japan better utilise the younger culture in the workforce. For example at the moment the young women who do have children have a 70% dropout rate from the workforce! This is a huge number. From my own observations I also notice that many of the younger female population appears to be more interested in arts and creative areas of culture such as dance and self improvement. And why not there is little point working in a culture that has little promise of an improving wage and an intrinsic disdain of professional women. Both of these issues are connected and dissolution of some of the old world cultural traits regarding attitudes to gender and culture in the workplace. Apart from this being a huge challenge, is also a balancing act. As the danger is if you succeed you may lose what make Japan unique. But challenging or not they need to be addressed if Japan is to survive in the modern world at all.

So is Japan still innovative?
The reach for perfection and iteration of the culture is perfect for innovation. As it is a continually improve and evolve and trying to reach perfection. Even focusing on the process, then improve this process so it too is perfected.

Japanese companies have always focused on the Japanese consumers. Japanese consumers are very demanding encourage incremental and radical innovation. However sometimes it can be too far ahead or innovated in a way not consumable from a globalisation perspective.

Without these cultural bridges they will continue to innovate internally based on needs and requirements of the Japanese people and lack the skill on how it could be adapted to other cultures. For example Eco-cycle is an automated Robotic Bike parking station that can house up to 1000 bikes in a 100m radius. This is a radically innovative idea and years ahead of other cities who are just now introducing government biking schemes.

In Summary
Japan is a highly innovative and remarkable country which in some ways is years ahead of other cultures however in others has failed to adapt to new world attitudes. In order to become less insulated and better connected they need to focus on changes to cultural stagnation and introduce educational initiatives and create incentives to change form the inside out if they are to grow. By making these changes and having an effect on endemic cultural attitudes this aligned with the economic incentives already being executed should be what Japan needs to turn things around.

References:

No Sex please We are Japanese:
https://www.youtube.com/watch?v=c5UBigXfiIc

Abenomics is Japan starting to come apart at the seams:
http://www.forexlive.com/blog/2014/07/12/is-abenomics-starting-to-come-apart-at-the-seams-12-july-2014/

Eco-Cycle – Underground parking systems in Japan
https://www.youtube.com/watch?v=X9hLDekpPS8

Waterfront Cities of the world
https://www.youtube.com/watch?v=NzRL-2Y43Tw