Ichiro Suzuki
“Monodukuri” or making things is a popular Japanese buzzword, to which a sense of respect is often attached. It lauds craftsmanship that creates artful products, which has been handed down from one generation to another, sometimes spanning for centuries. UNESCO World Heritage site temples and shrines in the ancient capital of Kyoto epitomize such craftsmanship. In the modern age, Japanese cars have been often reputed to be more reliable than ones made elsewhere. On a more subtle level, stationary products sold at Japanese stores are considered as superior, as well as inexpensive, to the ones sold outside of Japan. While many of such products are made in China these days, only the ones that fit Japanese consumers’ standard make inroads to the Japanese market. This can be considered as craftsmanship embodied by importers that deliver products to demanding consumers.
In the early years of the 21st century, “monodukuri” began to be heard in the media more often than in the past. Promoting manufacturing makes sense. The Biden administration is doing it with the CHIPS Act, in order to bring semiconductor manufacturing back to the United States. In recent decades, the majority of U.S. semiconductor makers became fab-less, focused on chip design while giving manufacturing jobs to foundries, which are represented by East Asian companies, most notably TSMC. The Biden administration came to understand having too many of chips produced in Taiwan or South Korea poses a serious national security risk in the age of Sino-American geopolitical competition. Disappearance of well-paying manufacturing jobs gave rise to grievances among blue-collar people, and resulted in MAGA movements.
So manufacturing is important. Japan’s emotional attachment to manufacturing, however, is twisted and backward-looking. Monodukuri became a popular buzzword at a time when once dominant Japanese tech companies were getting crushed by the birth of the internet. Corporate Japan was caught totally off guard by the advent of the digital age, and found itself unable to cope with it. They were utterly lost in the new age because they had a hard time understanding what to do with a rising force of something invisible. Japan has excelled in handling visible things, making visible products smaller, lighter and more efficient. Competence in visible things, however, can’t always be applied in things that are invisible. Worse, the Japanese society as a whole has a thinly disguised contempt for what’s not visible, obsessed with ‘visibility’. Software is a case in point, as opposed to hardware. Having thrived in the age of hardware, Japan simply got lost in a new age that is essentially run on software.
On top of it, the digital age has upset the traditional social hierarchy in Japan. A new wave of technology drove young, up and coming tech entrepreneurs to fame and immense wealth. Corporate Japan’s heavy weights raised eyebrows at brash young men and, sometimes, women in tech. At levels closer to everyone, tech-savvy young professionals edged middle-aged managers closer to the windows, sometimes out of the office. Such upheavals in the office and the society in general hardly fit the culture in Corporate Japan, where the lifetime employment practice and the seniority system have persisted. Even if they were aware of the necessity to changes brought by the digital age, they were not able to fit themselves to it. Seniority matters, and this system can’t be vanished overnight.
It was against this background that monodukuri or making things began being heard more often than ever. While Japan prides itself in the art of making things, a negative connotation is in attached to it in recent years. “We can still make things artfully and beautifully though we may be behind in invisible things.” It looks back on the past that has gone forever. Before the advent of the internet, it has been already expected that the Japanese economy’s dependence on manufacturing was set to decline, as it was entering the “post-industrial age”. No one was sure about what that meant, and then the digital revaluation had created massive and totally unforeseen disruptive waves. As the world enters the second quarter of the 21st century, Japan is at last getting itself adjusted to the digital age. Leading Japanese corporations have restructured themselves. Their employment practices have become considerably flexible within the constraints of the labor laws that allow lifetime employment to persist. Though Corporate Japan is not expected to rival American tech titans, they could compete, having emerged out of the wilderness at long last.
About the author: Mr. Suzuki is a retired investment banker based in Tokyo, Japan.
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