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Ripe Mango: Japan and its outstanding innovative SME manufacturers

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In this series of articles we will be putting the spotlight on some of the most innovative and interesting sources of manufacturing in the world.  We start with the small to medium enterprises (SME) manufacturers of Japan.

What constitutes an SME differs amongst countries; we will be using the definition subscribed to by Japan’s Ministry of Economy, Trade and Industry (METI). This categorizes SME’s businesses in manufacturing with less than ¥300m (US$3.6m) in capital.  It also restricts the definition to those in manufacturing with less than 300 employees.  Nearly all of the commercial businesses in Japan are SMEs (99%).  Most of the working population are employed by SME’s and contribute substantially to Japans economic output.  These companies might not be as well-known as Toyota, Sony or Mitsubishi but they are a critical component of the manufacturing and export supply chain.

Japan’s major export industries are:  computers, automobiles, iron, copper and steel.  Further important industries in Japan are: aerospace engineering, ship building, pharmaceuticals, bio industry, textiles, and processed foods.

Japanese manufacturing famously began its rise after the events of World War II.  They became so successful that many other countries began adopting their manufacturing techniques and philosophies in the 80’s.   Such as Kaizen which focuses on perpetual consistent improvement.  And lean manufacturing which emphasizes the reduction of over production and waste.    This illustrates how the main distinguishing features of Japanese manufacturing are its strong focus on efficiency and high quality standards.  This pairing of ideals allows them to develop the technology to produce a product at a comparable cost that is almost always superior in quality to outside competitors.

While many Japanese SME’s will subscribe to these practises, that is not where their real strength lie’s. Academic reforms in Japan over the last decade have encouraged entrepreneurship and technology to transfer from academia to practical applications. The results from these reforms are now starting to emerge.

In the case of Professor Satoshi Kawata at Osaka University who  took advantage of the new reforms and founded “Nanophoton”, with only 13 full-time employees. Nanophoton constructs incredibly precise laser Raman microscopes, which produce images based on energy fluctuations and bond interactions in laser photons at the molecular level.  This complex process allows the Nanophoton technology to be applied to pharmaceutical research to study and analyse polymers and semiconductors.

Whilst many of Japans large businesses are focused on maintaining high quality and increasing efficiency, their SME’s provide innovation and creativity.  This is incredibly valuable to Japan for their technological development, but also to those wanting to import.  These technological developments can also be of great use for other manufacturers or engineering companies.  As an example the Hardlock Industry Co., Ltd. in Higashi-Osaka produces a bolt nut that has been designed to never come unintentionally loose and has been used in high speed railways and the Tokyo sky tree.

Another prime example is GOGOH Co., Ltd. Established in 2000 they have developed a product called “zero clear” a chemical coating that provides incredible protection against stains, acid, bacteria, abrasion and temperatures reaching 500 degree Celsius.  Even the nightmare of spray can graffiti and permanent markers can be completely cleaned using ordinary tap water and a cloth.

What Japan’s SME’s do struggle with is exposure to wider markets as many are unknown outside their domestic marketplace.  This means there is massive potential for collaboration and partnerships from abroad where both parties would have a lot of value to bring to each other.

As described there is already a manufacturing culture of outstanding quality whose methods ensure affordability.  But Japan’s SME’s also can offer the next step in innovation that has also survived an incredibly competitive local environment.  As the old saying goes, if you always do as you’ve always done, you will always get what you’ve always got.  Or to put it more succinctly:

“If you want something new, you have to stop doing something old”

– Peter F. Drucker

The question is not, should you buy from Japanese SME’s? But from which one? and specifically in this case their sister site are purpose-built platforms which aim to take out all the bumps on the road to carrying out effective business worldwide.  Equally useful to buyers and sellers, they allow Japans SME companies to raise their profile and give buyers the opportunity to find the perfect products and solutions they require.  


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