September was a month full of technology-focused events in Japan.
The country’s police started to increasingly utilise artificial intelligence (AI) solutions to fight crime, and major train company JR East announced it will stop using the facial recognition system it had deployed to maintain order and reduce crime during the Olympics.
The Japanese government has also officially announced it will start issuing online vaccine certificates in December, and that a particular application of the technology may be used for commercial activities.
In other news, SoftBank Chief Executive Masayoshi Son said smart robots could be the key to revitalise Japan's growth and competitiveness.
Earlier this month, Japan also launched a new agency to speed up digitalization efforts
This issue of TÉKUNI is about these efforts, and more generally the state of digitalization in Japan.
👨💻 TÉKUNI Exclusive - Fuminori Gunji
Fuminori was born in Tokyo but raised in Germany. He lived in the country until he finished high school, for almost 20 years.
“So, mentally speaking I’m half German or half European,” Fuminori says.
The business expert then studied in the Netherlands at the University of Maastricht (International Economics and Business) and returned to Japan around 2008, where he started his career at a consulting firm.
“After four and half years there, I moved to Softbank, being part of the core team that launched and spearheaded Softbank Robotics’ domestic B2B businesses and overseas expansion efforts.”
In 2017, Fuminori joined MakeLeaps, a B2B SaaS startup, and successfully closed an M&A deal with Ricoh end of 2018. Today, he is the CEO of TokyoMate, a tech startup specializing in virtual office solutions.
“TokyoMate is a digital-first all-in-one Office-as-a-Service startup that allows business owners to run their business from anywhere in the world through our virtual office/address and virtual mail services,” Fuminori explains.
The firm also provide on-the-ground concierge business support via a English/Japanese bilingual virtual assistant service.
“Funnily enough, while talking with a friend, it dawned on me that the underlying theme of my career has had to do with getting people and institutions away from their reliance on paper.”
According to the CEO, traditional paperwork is the biggest enemy of modern firms, because that’s the main factor hindering digitization efforts.
“So every solution that enables us to get rid of paperwork is what enables Japan to move a step further toward digitalization.”
Fuminori believes then, once workflows and data are digitized and placed on the cloud and made shareable, they can be connected, visualised, and analysed with little time and effort, making it also easier to spot where bottlenecks are and thus improve the overall plan-do-check-act (PDCA) cycle of any operation.
“That’s the super basic minimal infrastructure you need. Technology can mean many things to different people. To me, it’s always about enabling us to do more with less, it’s about bringing down the cost of resources including the reduction of time and effort. And that’s what is at the heart of TokyoMate.”
Speaking about the digitization efforts of local and central government services in Japan in the last few years, Fuminori says it has been a slow process.
“There’s been very little progress from the central government until very very recently with the My Number card, which hasn’t really lived up to its expectations (yet), but it’s a move in the right direction.”
Moreover, Fuminori believes the central government has been generally slower to adopt digitization measures than certain other prefectural (local) governments.
“For example, Fukuoka City and Tokyo are two local governments that have been quite active and progressive in terms of instigating digital change, which has, I believe, triggered and pushed changes at the central government level.”
Different Types of Digital Technologies
According to Fuminori, there’s a distinction that needs to be made regarding ‘digital technologies,’ both privately and at a governmental level.
“Are Japanese companies using software? Yes, quite a lot. But there’s a huge difference between using cloud software and on-premise software (i.e. software that is not connected to the internet). And the number of companies using on-premise software is still relatively high in Japan (by international standards).”
Consequently, when it comes to digital technologies in the private sector, the divide between advanced companies and those that are lagging would usually depend on how much they are adopting cloud software.
Additionally, Fuminori explains, this divide is somewhat of a reflection of the generation gap.
“I’ve seen cases where, as soon as the reigns of a family business are handed over to the son or daughter - often in their 40s or 30s - things change really quickly because the next generation is used to newer technologies and are ready to embrace and implement them.”
The conversation then veered towards the launch of the Digital Agency in Japan.
“First of all, the most important thing is that they launched it. As anyone with a startup background will confirm, starting an endeavour is the hardest part. That alone deserves credit despite the criticism that the Digital Agency has received and its somewhat shaky start.”
Fuminori thinks it’s too early to tell whether this Digital Agency will deliver what it promises, but an interesting point to highlight is that the agency was given control of the IT budget of all central government agencies.
“I’m sure there were many people who weren’t happy with that, but it was the right move because without a budget you have no power. And that says something about the determination of the government to make this a success.”
Overall, the CEO is cautiously optimistic thinking about the Digital Agency.
“The very fact that this agency now exists, will create a ‘go-to guy’ within the government as well as for the public regarding matters that require legal reform and budget allocation changes that are needed to push digitization forward.”
Digitalization Efforts and the Pandemic
The lack of digitalization in government services for the public became a major problem during the pandemic in Japan.
When asked if, with vaccination programmes becoming more widespread, this necessity may gradually become less pressing, Fuminori says he doesn’t think so.
“Citizens have been waiting for the government to make this move. It’s not like COVID was the prompt that made people desire digitization. People have been wanting digital reform for some time now.”
In other words, according to Fuminori, even when the COVID threat becomes less pressing, it won’t change the fact that people want to get things done remotely.
“Now that work styles have shifted to remote capable in many companies, now that you can have meetings online, and now that you can open a bank account online, there will continue to be pressure for the public sector to provide the same online capabilities that citizens experience at their work and enjoy in their personal time.”
A Dualistic View of Technology
When asked about Japan’s dualistic approach to technology, Fuminori said the country is good at micro innovation but bad at instigating macro-level change.
“For instance, Japan is a world leader in developing and innovating smart toilets and robotics and other tech gadgets that operate in a standalone system. But we’ve often been bad at the kind of change that requires concerted, orchestrated, high-level thinking and planning.”
Moving forward, Fuminori believes the future of digital technologies in Japan will follow that of most industrialized countries, just with a 3-4 year delay.
“The good news is that because of collectivism in Japan, once the majority gets behind something, adoption and adaptation will be diligently and quickly implemented.”
A recent example of this is Japan’s vaccination progress. Even though Japan started vaccinating much later than the US, it has now caught up with the US and is set to surpass other countries that began vaccination efforts before Japan.
“I think the next 10~20 years of Japan will be quite interesting to observe, and the changes will create many opportunities not only for businesses but societal change in a broader sense.”
According to Fuminori, Japan’s ageing population and the retirement of baby boomers will also prompt a change of the guards at big and small organizations (in politics and business) and this should result in more progressive, bold decisions by key decision-makers.
“When I see Japan’s younger generations, how they think, what they care about, and how they are more outspoken than previous generations, I feel very hopeful about Japan’s future.”
This change in approach will also possibly lead the upcoming working class to different choices in their consumer behaviour or career plans, which will slowly but inevitably force companies and governments to adapt to this ‘new type’ of customers.
“Plus, Japan now has a thriving startup community that is slowly but surely starting to fan out in terms of business domain variety, thanks to a more diverse background of entrepreneurs than ten years ago, which means innovations not only in the IT industry but also in factory and field operations, medical, finance, legal, and real estate.”
❓ Want to find out more about the latest tech news in Japan?
🔗 Here is the newsletter’s link section:
Dai Nippon Printing plans to expand 5G coverage area - DNP
ANA, JAL plan drone services to boost remote areas - Kyodo
Japan’s police to increasingly use AI - The Asahi Shimbun
Amazon cloud service glitch resolved after disruptions - Kyodo
Shipping giant to start autonomous cargo ships by 2025 - Sora News
Japan to issue online vaccine certificates in December - Nikkei
KDDI and SpaceX team up on remote areas access tech - Kyodo
PayPal heats up buy now, pay later race with $2.7 bln deal - Reuters
Google launches News Showcase in Japan - Kyodo
Japan’s last double-decker shinkansen to be retired soon- TimeOut
Honda says domestic output at 40% of capacity in Aug-Sept - Reuters
Mizuho Bank suffers ATM system failure, 7th this year - Kyodo
Mizuho blames core system failure for outage - NHK
Science key to Fukushima plant water release - WSOC
Japan eyes tougher jail sentence for cyberbullying - Kyodo
Train operator scraps facial recognition plan - Sora News 24
Brain-science products raise ethical concerns - The Asahi Shimbun
Devs are making 4K games for Switch that doesn’t exist - Japan Times
VR photography exhibit held by Japan’s Virtual Rights - Sora News 24
Tokyo has a new electric moped sharing service - TimeOut
Company makes a robot to keep your cat entertained - Sora News 24
Tokyo startup creates system to provide free sanitary pads - TimeOut
Scientists to launch wooden satellite in 2023 - The Asahi Shimbun
Fukuoka is getting the biggest Gundam statue in Japan - TimeOut
Did Japan Just Invent Tech to Travel Into Deep Space? - Unveiled
Robots are coming to JR Tokyo and Yokohama stations - TimeOut
AI AirFriend: Make your own AI character - Grape
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