Three Radical Ideas for Creativity and Innovation in Japanese Companies

A couple of decades ago, there was a golden era in Japan, during which this small island was considered the number one innovative country in the world. The credibility that Japanese companies created at that time is still powerful today. However, the presence of Japanese companies in the global scene has greatly decreased in the last decade. Japan ranks twelfth in The Most Innovative Economies in the World and ranks fifteenth in Global Innovation Index 2019. The world no longer considers Japan a leading innovative and creative country. Instead, Korea, Israel, Ukraine, and other countries get more attention in the field of innovation, and, needless to say, Silicon Valley. In this article, I’d like to share three profound ideas that will encourage creativity and innovation in Japanese companies, while taking into account Japanese business culture.

Develop a culture that embraces failure

Japanese companies tend to think that if they pay more, they can get competitive talent that can accelerate innovation. For example, FUJITSU has recently declared that it will pay up to $340,000 per year for employees with a talent for digital transformation. However, in order to develop an innovative and creative idea, it is crucial to have a culture that embraces failures. Many people mistakenly think that creative and innovative ideas are born out of a few select people that can solve all the world’s problems and issues. In Japan, the problem is that there are not many places where creative and innovative ideas can flourish. These ideas are born through a process of trial and error, like science. Innovative ideas often challenge conventional ways of thinking and disrupt ways of life that are considered normal. So, creative and innovative ideas are often rejected by the majority. This means that in order to develop something innovative, there must be many failures and mistakes along the way. In other words, if there is no failure, there is no innovation. No matter how many creative and innovative employees you have, if there is not an environment that embraces failures, they cannot test out any ideas, and hence no innovation can happen. Particularly in Japan, people are afraid of making mistakes for fear of being criticized by others, especially these days. Also, failure itself is considered something negative that needs to be punished. This culture strongly impedes people from trying something new. Risk management is essential. However, in Japan, this is misunderstood as taking zero risks, which results in doing nothing new. It is important for Japanese companies to develop a culture that embraces and learns from failures. Having no failure is not risk management.

To develop something innovative,

there must be many failures and mistakes along the way

Improve Cognitive Diversity

Cities and countries that bring together diverse people, such as Silicon Valley, tend to have an advantage in accelerating innovation. However, simply bringing people together from different nations who speak different languages does not accelerate innovation. In Japan, unlike in Western countries, it is not common for people to interact with foreigners or people of different ethnicities on a daily basis. In other words, there is not much diversity in society. Most people speak only Japanese, and the majority of people have never been abroad. However, what is truly critical is not whether there are foreigners living in Japan or whether Japanese people can speak different languages, even though these are important points to discuss, but instead the lack of cognitive diversity in society. A lack of cognitive diversity means that people are not capable of dealing with different ideas and ways of thinking. Innovation often appears when points that seem irrelevant are connected. The reason why diversity is often considered an important element for innovation is that the interaction of people with different backgrounds helps create different ways to connect dots. However, if the majority of people have a monolithic way of thinking, they reject creative and innovative people because they tend to think differently. Developing cognitive diversity would allow people to accept others who have completely different ways of thinking and different types of ideas, instead of jumping to an immediate judgment and rejection due to fear. Many Japanese companies bring international talent to their innovation departments, but when they propose innovative ideas, they are often rejected. It is important to speak one’s own opinion, but in order to connect dots differently, it is even more important to cultivate the ability to engage with people who are cognitively different from yourself. It is highly important for Japanese society to increase its tolerance for diverse ways of thinking. Having people who appear physically different is also important, but without cognitive diversity, they will not be well integrated.

Cultivate the ability to engage with people who are cognitively different from yourself

Break social norms  

Innovation often happens when you challenge the status quo. It requires critical thinking and skeptical observation of the environment and current situation. So, it is highly important to have the ability to question and doubt what is considered normal and true. In Japan, people tend to give priority to the format rather than the content. They are almost obsessed with following a protocol without thinking much about the purpose and objective of it. For example, it is quite common in Japan that you cannot check in to a hotel before the check-in time, even if a room is ready. Similar things happen in a business environment. In the middle of the COVID-19 outbreak, a number of people have been required to commute the office just to put their physical seals, called hanko, on documents. In Japan, almost all the official and legal documents require hanko even though the seals can easily be forged. It is quite obvious they are meaningless in today’s society, but people do not question it. Likewise, there are many social norms and unwritten rules that people follow without understanding why they follow them, such as seniority. Elderly people are considered superior to the younger generation. In every situation, younger people need to change the form of speaking (way more complicated than the conjugation in the Western languages) and show obedience for the sake of so-called “respect.” This develops a strong hierarchy in society and leads people to stop doubting what is considered normal. As a result, ideas from young people or people with less experience are often undervalued and not assessed carefully. To enhance creativity in organizations and groups in Japan, it is necessary to break the social norms that strongly remain today and encourage open and radical conversations. A disruptive shift starts mentally, not technologically. Particularly, it is necessary to stop applying the ideas of Confucianism, such as seniority, in a business environment, which inhibits fair conversation and expression of thoughts so that people are not able to challenge the status quo.

A disruptive shift starts mentally, not technologically.

Conclusion

In general, no single and simple reason hinders innovation and creativity. However, the profound points introduced above can contribute to enhancing innovation and creativity in Japan, but only if they truly think about their future. Obviously, these ideas would have to be supported by a system and structure in Japan that includes organizational and structural changes, which are not discussed much here. For example, the decision-making process is one of the key elements that has to be changed in order to enhance innovation and strengthen competitive advantages to compete in a global market. In many Japanese companies, it is not clear who has a responsibility for what. They tend to try to have a unanimous decision-making process, which inhibits change and discourages developing new ideas. It is a way for them to avoid risking failure, but it is important to be aware that staying the same is the biggest risk today, especially as the world changes rapidly. This attitude of decision-making is strongly linked to a culture in which failures are considered shameful, and people who have made mistakes tend to be required to resign. So, it discourages people to take any kind of risk. Everything is intertwined, and changing one thing will not change the entire society, but addressing the points mentioned above can at least help those innovative and creative people in Japan express and develop their ideas. In my opinion, changing Japanese society is almost hopeless and not at all practical. That is why it is more important to develop and secure an environment where innovative and creative people can flourish, rather than changing the rest of society.