Innovation Policy Challenges

particular countries. Many companies shy away from collaboration 
with companies in emerging countries such as China for fear of 
leaking technologies. However, a paradigm shift is now required, in 
which the focus is on extracting value not so much from individual 
elemental technologies, but from constructing a whole business 
system that includes the designing and packaging of products and 
services. In some cases, a strategic mindset of “small sacrifice for 
greater gain” may be necessary. Furthermore, a business system is 
not comprised of just one firm, but should be an organic ecosystem in 
which many firms collaborate. As we examine the international 
competitiveness of Japanese firms in the future, a pressing issue is 
creating a technology management strategy that focuses on building 
such a global ecosystem.
At a difficult time for private companies following the Tohoku 
earthquake, government interventions in the Japanese innovation 
system are important. METI and other relevant ministries are 
introducing policies to support the network-based innovation model. 
However, most policies are inward-looking, and the Japanese 
government still shows limited commitment to the globalization of 
R&D activities. Multinationals in Japan are competing with their peers 
in the US, Europe, etc, for emerging international markets such as 
China. In this situation, the shift of R&D activities overseas is 
inevitable. This may facilitate technological leakages outside of Japan 
and provoke public concern about the hollowing-out of high value-
added activities. However, the world is changing dramatically, and the 
government must respond to rapidly altering policy needs and support 
the innovation activities of companies in an open and global era. 

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References
Chesbrough, H. (2003), Open Innovation: The New Imperative for 
Creating and Profiting from Technology, Harvard Business School 
Press.
Henderson, R., Jaffe, A. B. and Trajtenberg, M. (1998), “Universities 
as a source of commercial technology: A detailed analysis of 
university patenting, 1965-1988”, 
The Review of Economics and 
Statistics
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Immelt, J. R., Govindarajan, V. and Trimble, C. (2009), “How GE is 
disrupting itself”, 
Harvard Business Review
, September 2009. 
Motohashi, K. (2010), “Management of Offshore R&D in China: Cross 
Country Differences of its Motivation and Performance”, 
8th 
GLOBELICS International Conference
in Malaysia in November 2010. 
Motohashi, K. (2005), “University-industry collaborations in Japan: 
The role of new technology-based firms in transforming the National 
Innovation System”, 
Research Policy
34, 583-594. 
Motohashi, K. and Muramatsu, S. (2011), “Examining the University 
Industry Collaboration Policy in Japan: Patent analysis”, 
RIETI 
Discussion Paper Series 
11-E-008, 2011/02. 
Mowery, D. C. and Sampat, B. N. (2005), “The Bayh-Dole act of 1980 
and university-industry technology transfer: A Model for other OECD 
governments?”, 
Journal of Technology Transfer
, 40(1/2), 115-127. 
RIETI (2004), The 2003 Report of the R&D External Collaboration 
Survey, June 2004 (in Japanese). 

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