The Evolution of Japan's Industrial Research and Development

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Abstract
This chapter is a survey of both macro data on national trends and micro data on organizational structures of Japanese R&D. The macro part makes the point that high R&D expenditure by Japanese firms has been a trend that started long before the first Oil Shock. The micro part, on firm organization, starts with useful history concerning changes in the pattern of division of labour between central, divisional, and factory research labs. The chapter then reviews the accumulated body of information presented in the chapter on research careers, reward structures, professional self-images, the role of Ph.D. research and qualifications, corporate university links, and the relation of all these to research productivity. The chapter finds a strong isomorphic pattern of career and incentive structure between the Japanese manufacturing and R&D organizations. The chapter also discusses trends for major corporations to hive more and more work off to subsidiaries, one of the purposes of which is to introduce salary and security differentials between different functions, and it examines the nature of the links between R&D workers in core firm and those in subsidiaries. The chapter closes by pointing out that research managers of Japanese firms are concerned increasingly with the challenge of building more creative organizations with greater capabilities in basic research and radical product innovations. For that purpose, they are trying to draw on their Western counterparts for organizational technology.

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