A look at events in the IT industry in Japan and abroad

The Tao of Japanese IT Management

by John Boyd

Ever since Japan's industrial juggernaut rose to challenge American dominance in arenas as diverse as steel, automobiles, and semiconductors, Japan's exotic approach to business management has been keenly analyzed in the US. American management has made it its business to put Japanese corporations under the microscope to try and discover the secrets of their spectacular success. In some cases, Japanese business practices (such as Just-In-Time inventory control and Quality Circles) have even been tried out in US corporations.

There is one area, however, that no one has paid much attention to: How the Japanese manage their information technology. Couldn't the Japanese approach to dealing with IT provide fresh insights for Western companies?

Japan lags behind in IT

On the surface, just the opposite appears to be the case. Most Japanese IT people will tell you that while Japan's automated factories lead the world in manufacturing efficiency, the typical Japanese office and its white collar staff lag behind when it comes to employing IT, especially for strategic purposes. "In the US, using computers is much more mature," says Hideaki Nishimura, an IT section manager at pharmaceutical manufacturer Nippon Roche in Kamakura. "One PC for each person (is common) in the US. In Nippon Roche, it is four persons to a PC."

Consultants agree. "In US businesses, almost everyone has their own PC, and they are usually networked," notes Naoki Wakai, a consultant with the Gartner Group in Tokyo. Japan's lack of PCs and networks, Wakai believes, has "become a barrier," causing Japan to lag behind advanced IT countries.

Hardware installation figures back up this viewpoint. According to market researcher Dataquest, just over 20% of Japanese PCs were networked in 1994, while more than 60% of PCs were hooked together in the US. Admittedly, things are changing rapidly; but Japan still has a way to go to catch up. The reasons for the lag include a propensity to indulge in expensive, customized software; a conservative streak that sees companies still enamored with their mainframes and mid-range "ofucon" (office computers); and a lingering keyboard phobia compounded by a cumbersome writing system.

Different needs, different methods

Yet some observers, such as Bill Totten, American cofounder and president of software distributor KK Ashisuto, point out there aren't the same needs for IT in the Japanese office. "The Japanese are much more oriented to face-to-face communications and solving things at meetings," says Totten. "American companies are doing a good job in the way they handle IT, based on their corporate culture and their way of running business. The Japanese have taken a different approach, because their way of running a business is different."

One result of this difference is that the position of Chief Information Officer, normally an executive-level manager in charge of overall IT, is extremely rare in Japan. Instead, decisionmaking in IT is often based on middle-management initiatives and consensus thinking. Hiring IT staff is also done differently. Japanese companies prefer not to employ specialists, but rather to hire generalists, whether it is to fill the computer systems department or any other business function.

As Nippon Roche's Nishimura explains, "Our policy is to produce business generalists, not specialists or technologists. We are a pharmaceutical company, not a computer company. We can always hire a technician, but we can't hire someone who knows Nippon Roche's business."

The generalist principle

To underscore this generalist principle, IT people (like other staff) get rotated throughout the enterprise for years on end, to learn about the overall business. The downside to this, of course, is that many IT people in Japan lack the deep technical knowledge of their US counterparts. As a consequence, the computer systems department is often looked on as a low-status support group, and is rarely called on directly to help in strategic matters. Says consultant Wakai, "End users don't expect them to take the lead. They have the same status as a copy machine maintenance person."

On the other hand, Japanese IT people have a greater understanding of the business than their American counterparts, so there is likely to be less friction between them and end users than is found in the US. Moreover, when new technology is introduced, or business reengineering undertaken, the consensus that must first be reached throughout the company ensures that affected staff are better prepared, or are transferred --rather than being crudely fired, as is common in the US.

What this all comes down to is that, while the Japanese can learn much from how corporate America handles IT, corporate America could learn a thing or two from how Japanese companies handle the people who both manage and use the technology.

In addition to writing for Computing Japan, John Boyd is the Tokyo correspondent for Information Week and writes the weekly Computer Corner column in the Japan Times. He is otherwise available for hire, though, if the fee is fat. He detests e-mail, so you can bug him at 6840615@mcimail.com, but don't expect an electronic reply.