VOL.2-1

ICEBREAKING

http://kaden.watch.impress.co.jp/docs/event/ms2011/20110420_440815.html

Kia Italia vs. Toyota

Something to talk about:• Is Kia cool?• Why do you think so?• Do all Italian and/or European think so?

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• The black car is a Crown, Toyota (Photo taken in Toyota shop in Kyoto).

• The cars in the middle Kia Stinger and CEED(Photo copied from their HP).

• Those two may/ may not be comparable from the function point of view.

https://www.kia.com/it/modelli/stinger/informazioni/

https://www.kia.com/it/tutto-su-kia/iniziative-speciali/bellamossa/

”Kawaii” → “Kakkoii” → “Yabai”

• ”Kawaii” = Cute = Carino

• “Kakkoii” = Cool = Bello

• “Yabai” = Awesome =

= Eccezionale?? Pericoloso?? Rischioso??

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TOYOTA COROLLA”Kawaii”→“Kakkoii”→“Yabai”

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4th (E-KE70) 1982～2nd (E20) 1970～

http://car-cm.com/toyota/

10th (E140) 2006～ Acsio

Current Model

佐藤敏明（2018）「大企業のインハウスデザイナーから学ぶデザイン思考とその実践方法－“ど・DOデザイン”のススメ－」を基に作成

”Kawaii” → “Kakkoii” → “Yabai”

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https://www.bing.com/images/search?view=detailV2&ccid=uFv2JZcR&id=928EC6C8F24FF7398B8F4C9FAAE99A1A8DE52E20&thid=OIP.uFv2JZcRgKboIS5aoAF3ZAHaEW&mediaurl=http%3a%2f%2fwww.asahi.com%2fand_M%2finterest%2fgallery%2fretire_train%2fimages%2f13022812.jpg&exph=382&expw=650&q=%e6%96%b0%e5%b9%b9%e7%b7%9a200%e7%b3%bb&simid=607998987558650410&selectedIndex=392

https://pbs.twimg.com/media/CTw4CZBW4AARgrr.jpg・イエロードクター925系（S1編成）・200系2000番代（F52編成）、・200系（E？編成）

https://www.bing.com/images/search?view=detailV2&ccid=Mm0hZrms&id=1E2CD35037B4A99DFC356B535D54B99B7A4EA3F3&thid=OIP.Mm0hZrms_S3LFcaK6IgvWgHaEc&mediaurl=http%3a%2f%2fwww.railway-enjoy.net%2fpictures%2fjr%2fshinkansen%2f0%2fimg%2ftop-image.jpg&exph=450&expw=750&q=%e6%96%b0%e5%b9%b9%e7%b7%9a+0%e7%b3%bb&simid=608047327400561684&selectedIndex=0

佐藤敏明（2018）「大企業のインハウスデザイナーから学ぶデザイン思考とその実践方法－“ど・DOデザイン”のススメ－」を基に作成

Ferrari”Kawaii”→“Kakkoii”→“Yabai”

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Ferrari275 GTB/4

Berlinetta (1967)

Ferrari BB 512 1976

https://auto.ferrari.com/it_IT/modelli-auto-sportive/modelli-del-passato/512-bb/

https://youtu.be/ZQp3zhJSwqY?t=13

Ferrari FXX K 2015

https://www.bing.com/images/search?view=detailV2&ccid=BG7wxlPi&id=92E72BAAD41403466BAE95228EE8AB7B6A3C0F5A&thid=OIP.BG7wxlPi6X2JAkiTW-eciAHaFj&mediaurl=http%3a%2f%2fwww.v12-gt.com%2fvar%2fv12gt%2fstorage%2fimages%2fpetites-annonces-gratuites-avec-photo-pour-acheter-ou-vendre-votre-voiture-de-luxe-sport-prestige-ou-de-collection%2fferrari-275-gtb-4-berlinetta-1967%2f252085-1-fre-FR%2fFERRARI-275-GTB-4-Berlinetta-1967_zoom.jpg&exph=600&expw=800&q=ferrari275+gtb%2f4+berlinetta+(1967)&simid=608046863541864105&selectedIndex=3

佐藤敏明（2018）「大企業のインハウスデザイナーから学ぶデザイン思考とその実践方法－“ど・DOデザイン”のススメ－」を基に作成

VOL.2-2

INNOVATIONAND ECONOMIC GROWTH

http://kaden.watch.impress.co.jp/docs/event/ms2011/20110420_440815.html

Trends in innovation theories1960s’-70s’ 1980s’-90s’ 2000-2005 Recently

Industry trend

Japan surging in the fields of steel/shipping/home electronics

Japanese style management as the strength in automobile/ semi-conductor

Intel/Microsoft became champions in IT industry

Social value industry such as photovoltaic in Germany

Japanese economy

Recovery from post war/ Technologyimported from USFirms/products

World’s no.1 technology-oriented nation/Genba-ryoku

US surpassed Japan by final productssuch as PC

Advanced technologies but not industrialized domestically

Focus on innovation

Technologyinnovation by product elementsFirms/products

Vertical integration by KaizenFirms/imitatedproducts

Standard platform /horizontal specializationindustry/multiple firms

Government supported market creationManyindustries/many firms

Trend in innovation research

Product innovation/ Process innovation Technology innovation and growing productivity

National innovation system to adjust the national and regional environment to cope with technology innovation

Open innovationto introduce inter-firm technology stimulation

Innovation ecosystemSustainable growth of entire social value

8http://www.meti.go.jp/policy/economy/gijutsu_kakushin/kenkyu_kaihatu/20fy-

pj/kyouka.pdf

Started from Loom

• Kiichiro Toyoda was the founder of Toyota Motor Corporation and its group.

• His father, SakichiToyoda, engaged in developing loom, expanded into the automotive business.

• The patent application for this wooden hand loom was awarded patent No. 1195, "Loom", in 1891.

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• The Great Kanto Earthquake of September 1, 1923

• Ten years later, on September 1, 1933, the Automotive Production was established within Toyoda Automatic Loom Works, Ltd.

After the Koromo Plant was built in 1938, the following measures were implemented;

-incorporating quality within processes-controlling through statistical techniques-quality checking on respective production lines.

https://www.toyota-global.com/company/history_of_toyota/75years/text/taking_on_the_automotive_business/chapter2/section7/images/l01_02_07_06_img01.jpg

First car line-off at Motomachi Plant (1959）

• Toyota's production capacity doubled overnight, an important first step for the mass production of passenger car.

• Anew conveyor system linking the three processes of body assembly, painting, and final assembly.

• Construction of the plant was a big gamble that would either payoff handsomely or ruin us.

• Toyota suddenly became the top among its domestic competitors.

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The Origins of “Just-in-Time”

• There is no waste and there is no excess.

• Just make what is needed in time, but don't make too much.

• ‘Kanban system’, having subsequent processes take what they need from the earlier processes.

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Body Assembly Line at Koromo Plant

Financial Data (2014-2018)

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Net Income and ROE (Return on Equity)•Net Revenues

Organizational Capability

• Capability that organizations possess

• Collective knowledge constitutes a source of organizational capability.

• Collective knowledge is:

• Stored in rules, procedures, routines, and shared norms, as either a ”stockpile” of knowledge as a form of data or a “flow” emerging from interaction.

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Lam.A CH.5 of Fagerberg, Mowery and Nelson (2005)

Japanese-style Management

• “Portable shrine management,” middle management supports top management• Lifetime employment

• Seniority system

• Recruitment of new graduates

• Preset job training

• Respect for human harmony/integrity

• “Ringi”: proposals prepared by staff; approval by management

• Group responsibility system

• Authoritarian, as well as democratic

• Paternalistic management

• However, this management style does not function as effectively as before

Odaka, K (1984)

“Genba-ryoku”

• Genba means manufacturing site and/or branches where employees are interacting with the customers

• Genba-ryoku means:

• Knowledge shared at site, transferred at site

• Accumulated knowledge through activities and human relationship at site

• Includes know-how and/or capability which can only be observed by a third party

• Great Genba-ryoku was observed immediately after the East Japan Earthquake and Fukushima Nuclear Plant accident

http://www.cscd.osaka-u.ac.jp/user/rosaldo/060518genba.html

Myths and reality

• Myths generated fictions and exaggeration, deviated from the reality• Lifetime employment existed in other countries, and is not the only

factor of the myths

• Employment system, not only supported economic growth; so did industrial policies, shareholding structures, etc., but it is a huge social issue

• Reputation overseas produced excessive Japanese-pride• Generated undue admiration for Japanese-style management

• Japanese traditionally suffered from an inferiority complex, but changed into superior attitude

Odaka, K (1984)

Alliance between TOYOTA and SOFTBANK

• Toyota declared in January 2018, that it aims to shift from "a company building a car" to "mobility company.

• Investment ratio of MONET Technologies, their J/V is Toyota 49.75%, Softbank 50.25%.

• President Son who has emphasized that the car of the future will be "a lump of semiconductors."

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Case study- Softbank

https://www.softbank.jp/mobile/products/

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https://www.nikkei.com/markets/ranking/page/?bd=caphigh

Enterprise value as of October, 19, 2018

(EURO mil.)1 Toyota 165,0832 NTT Docomo 84,7383 Softbank 80,6874 NTT 74,9405 Mitsubishi UFJ 73,0316 SONY 61,9437 KDDI 58,0808 Keyence 52,888

9Mitsui Sumitomo

47,903

10 Japan Postal 47,042

Softbank (1981-)

• Founded in 1981, envisioned to be a global company with an enterprise value of over 1 trillion Yen in 2011 (10 trillion Yen in 2018)

• Established US branch in 1994 to enter into internet business

• Acquired COMDEX and Giff Davis (IT publishing company) for a combined over 300 billion Yen

• Soon after, started “Yahoo! Japan” whole enterprise value fell to 1/100 due to the crash of the IT bubble

Softbank (2010)

Softbank (2001-)

• Started Yahoo! BB in 2001; 1 million people called to reserve the new service

• Acquired Japan Telecom in 2004 for the 340 billion Yen

• Suffered from many claims and a huge deficit, accumulating debt in the amount of 300 billion Yen

• Mobile phone license approved for three new companies (Softbank, eMobile, and IP Mobile), in addition to two large carriers (DoCoMo, au)

,Softbank (2010)

Softbank (2006-)

• Acquired Vodafone for 2 trillion Yen in 2006

• Largest M&A transaction ever in Japan

• Many believed that it would not rival DoCoMo, or au

• Needed overall transformation strategies, to cope with the quality conscious customers of Japan

• Strengthened 3G network, 3G machines, contents, and sales promotion/branding

• Survival game for sales activities

• Sold the phone in installments

,Softbank (2010)

Softbank (2008-)

• iPhone introduced in 2008• Provided no information on product specifications from Apple

before the alliance contract• New Slogan “Phone and internet in one ,” established

Softbank’s brand image• A smartphone without “Osaifu Keitai” and 1 SEG (Japanese

terrestrial digital broadcasting service for mobile devices)• Price decreased (from 60,000 Yen to less than half that)• Soon after, started iPhone 4

• iPad • Licensed only for Softbank in 2010• Reservations available only at the Softbank counter

(when there was no Apple Shop)• 13% increase in sales, 57.3% increase in profit in 2009

,Softbank (2010)

Softbank (2010-)

• New 30-year vision in 2010

• To share intelligence and knowledge through an IT digital revolution

• To be happy

• To see continuous growth for 300 years

• How Softbank will be in 30 years

• Importance of human emotion

• Comfort/Satisfying wants

• Intelligence/love

• Computers in 30 years

• Development of the cloud system

• Changes in education, medical, and work environments

,Softbank (2010)

Softbank (vision in 2010 ±300 years)

• The world 300 years before• The average span of life was 33 years• We co-existed with machines only after the industrial revolution,

and later, the information revolution• The world 300 years from now

• Calculation capability of computers will surpass that of humans• Capability of machines will exceed human brains, and machines will

be “intelligent”• Paradigm shift in human society• Human clones, gene therapy, artificial intelligence

• Importance of partnership strategies• Sharing objectives, cooperating, collaborating• Gaining deep insight into technology• Understanding finances• Having leadership

Softbank (2010)

Softbank from 2014

Jun. ’14Announced ‘Pepper’, the world's first personal robot that reads emotions, jointly developed with ALDEBARAN Robotics SAS. (currently SoftBank Robotics Europe)

Jun. ’15Pepper, the world's first robot that reads emotions, goes on sale in Japan.

Feb. ’16Began offering IBM Watson for Japan with IBM Japan, Ltd.

Apr. ‘16Established SB Drive Corp. to commercialize smart mobility services that utilize self-driving technologies.

Jul-16Began joint research project with Honda Motor Co., Ltd. in the area of AI.

Jul-17Established WeWork Japan, a joint venture with US-based WeWork and SoftBank Group Corp.

Nov. '17Began joint research with Honda R&D Co., Ltd. on connected car technologies that utilize 5G mobile communication system standards. 28

Financial Data (2014-2018)

Alibaba IPO on NY Stock Exchange in 2015• Softbank owns 32.4% of shares in Alibaba

• Its investment of 2 billion Yen in 2000, resulted in 500 billion Yen of capital gain

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Total sales

Total AssetNet Profit

Speech by Son Masayoshi at the annual shareholders’ meeting on Jun 21, 2013 “I was/am a boaster.”

VOL.2-2

WHAT IS THE RATIONAL FOR THE ALLIANCE

http://kaden.watch.impress.co.jp/docs/event/ms2011/20110420_440815.html

Alliance between TOYOTA and SOFTBANK

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• Young staffs at both companies constantly had discussion for the alliance for half a year.

• The two companies have a common vision for the future, "to make a traffic accident zero."

• Investment ratio of MONET Technologies, their J/V is Toyota 49.75%, Softbank 50.25%.

• President Son who has emphasized that the car of the future will be "a lump of semiconductors."

• Toyota declared in January 2018, that it aims to shift from "a company building a car" to "mobility company.

“A Car of Love” or “Mere commodity”?

• President of Softbank, Mr. Son says that a car is just one part, rather the platform has greater value, and the car will be "commodity (mere commodity)"

• President of Toyota, Mr. Toyoda, calls it "a car of love" and sticks to its value.

• Only car "is attached to" love “, being an emotional presence, among a number of industrial products even if any AI (artificial intelligence) is loaded.

• Two companies, regarded as "water and oil", entered into alliance, based on Mr. Toyoda’s risk awareness of changing automobile industry.

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Discussion

• Do you think that the will be “a car of love” or “a mere commodity”?

• Why?

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Investment and alliances

• Toyota invested in Uber in 2016, and in January this year, in collaboration with Uber, even in the development of e-pallets of commercial electric vehicles (EV)

• However, SOFTBANK is the largest shareholder of each affiliated company The reality that Toyota was unlikely to draw its own future map without compromise with Softbank was standing in front of Toyota.

• In May this year, Softbank invested in General Motors, finally holding about 20% of the shares.

• For Softbank, Toyota is just one of a number of partners in the service field, keeping the alliance with Honda in AI field.

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