Competitiveness of Japanese Companies and Industries: Implications for Thailand

1. Competitiveness of Japanese Companies and Industries: Implications for Thailand Hirotaka Takeuchi Hitotsubashi University Graduate School of International Corporate Strategy (ICS) World Bank Institute Seminar May 19, 2006 Bangkok, Thailand • Hirotaka Takeuchi, 2006

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3. A Once - in - 200 - years Change Is Taking Place Industrial Society Knowledge Society • Hirotaka Takeuchi, 2006

4. The Next Society will be a knowledge society. Knowledge will be its key resource… Peter F. Drucker2002 • Hirotaka Takeuchi, 2006 • Hirotaka Takeuchi, 2006 4

5. The Means of Production Set the Two Societies Apart Industrial Society Knowledge Society • Machinery • Robots • Assembly line “HEAD” and “HAND” of every employee

6. “Explicit Knowledge” and “Tacit Knowledge” Explicit Knowledge（HEAD） Tacit Knowledge（HAND） • Words • Numbers • Data • Formula • Sound • Pictures • 5 Senses • Experience • Insight, hunch, intuition • Emotions, feelings • Ideals, beliefs, values

9. Top Three Most Frequently Cited Publications Ranked by Straight Count • Rank Author/s Publication(Year) Score • Nonaka & Takeuchi The Knowledge-Creating Company (1995) 122 • Davenport & Prusak Working Knowledge (1998) 58 • Stewart Intellectual Capital (1997) 55

10. Top Three Most Frequently Cited Authors Ranked by Straight Count • Rank Author/s Current Affiliation Score • Nonaka, I. Hitotsubashi Univ. ICS (Japan) 306 • Davenport, T.H. Babson College (U.S.) 218 • Takeuchi, H. Hitotsubashi Univ. ICS (Japan) 128 3. Bontis, N. McMaster Univ. (Canada) 128

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20. Breath of “Ah-Un”

21. The Knowledge Conversion Process (1) Explicit Tacit

22. SECI:The Knowledge Conversion Process Tacit Tacit Socialization Empathizing Externalization Articulating Tacit Explicit Tacit Knowledge Explicit Knowledge Internalization Embodying Combination Connecting Explicit Tacit Explicit Explicit

24. The Knowledge Conversion Process (2) 新しい「知」を創造するには…② (Individual) (Group) (Organization) (Community)

25. Japanese Approach to Knowledge (1) 新しい「知」を創造するには…② A company is viewed as a living organism rather than a machine for information processing

26. Japanese Approach to Knowledge (2) 新しい「知」を創造するには…② Knowledge is defined as “a dynamic process of justifying human belief toward the truth”

27. Japanese Approach to Knowledge (3) 新しい「知」を創造するには…② Tacit knowledge is emphasized over explicit knowledge, which is seen as the tip of the iceberg

28. Japanese Approach to Knowledge (4) 新しい「知」を創造するには…② Self-organizing teams are recognized as playing a key role in facilitating a dynamic and intensive interaction among team members and providing a shared context for everyone

29. Japanese Approach to Knowledge (5) 新しい「知」を創造するには…② Middle managers are seen as knowledge engineers who resolve the contradiction between top management and the front line

30. Middle-up-down Knowledge-creation Process Grand Theory (What ought to be) (Top) Solving contradiction Mid-range theory (Middle) Contradiction Reality (What is) Cross-leveling of Knowledge (Front-line)

31. Japanese Approach to Knowledge (6) 新しい「知」を創造するには…② Knowledge is acquired from the outside and utilized effectively to amplify the knowledge spiral

32. Internal BA Individual contexts are shared at Ba, and the shared context and individual contexts expand themselves through such interaction

36. External BA University Customer Government Local Communities Supplier Competitor Firm

39. Sponsoring of Racing Team First Professional Road Racing Team Shimano-Frandria(Belgium)in 1973

40. Totally against the existing common senses Nothing but Don’ts

41. Sponsoring of Racing Team Champion in 2004 Lance Armstrong （USA) (Winner of 6th consecutive TdF 1999-2004)

43. The Essence of Knowledge Creation Lies in Embracing Opposites 新しい「知」を創造するには…③ Containing paradoxes Cultivating contradictions Embracing dualities Tyranny of the “OR” and the genius of the “AND”

44. Synthesis Thesis Antithesis Knowledge – creating Companies Are Dialectic Companies

45. Having well-defined plans and processes / Needing to improvise Having to compete against other Marines Having to place their success above your own / “Dialectics” at U.S. Marines • Embracing paradox Dealing with complex environments calls for a nonsimplistic, non-extreme mindset, and the tension between traits can provide the needed subtlety and variation in outlook. Cultivate opposing traits A need to risk failure / A need to succeed Being empowered / Respecting the hierarchy Being disciplined / Being creative Having a core job / Handling different functions Carefully analyzing / Acting quickly Source: Freedman, D.H., Corps Business: The 30 Management Principles of the U.S.Marines, Harper Business, 2000 • Hirotaka Takeuchi, 2006

46. East / West Small / Large New / Old Practice / Theory Cooperation / Competition Public / Private Have’s / Have-not’s　 “Dialectics” at Hitotsubashi ICS

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50. Great Thinkers • Hirotaka Takeuchi, 2006