The Internationalization of Corporate R&D

THE INTERNATIONALIZATION OF CORPORATE R&DR&D Cooperation with Overseas External OrganizationsAnother important practice is research cooperation with external organizations. Accordingto the MEXT survey, 87 percent of companies have conducted research anddevelopment in collaboration with external organizations (both domestic and overseas)during the last five years (MEXT 2004a). The percentage is almost the same in manufacturingand non-manufacturing industries. This trend is even more salient for largecompanies with capital of 467 million dollars or more; almost all large companies arecollaborating with domestic and overseas external organizations in their research anddevelopment activities.Figure 9-6 shows different types of external R&D cooperation conducted by Japanesecompanies. The strongest trend is increasing cooperation with domestic universities,companies and public organizations. This might be the result of the recently implementeduniversity reform in Japan giving universities more financial independence.Japanese Corporate R&D Activities in SwedenMany examples of Japanese corporate R&D activities in Sweden are in the area ofbiomedicine (see Figure 9-7). There are also some ongoing clinical trials and the expectationof extending the activities in the near future.It should also be noted that some Japanese high-tech companies plan to initiate R&Dactivities in the area of bio-nano technology in 2006.9.2.4 R&D Activities by Foreign Companies in JapanJapanese CompetitivenessAs discussed earlier, Japan ranked third in the world with regard to R&D investmentsin absolute terms, and fourth in the world by percentage of GDP. However, Japan holdsonly the 30th position in IMD’s overall competitiveness ranking. Furthermore, a studyby the Mitsubishi Research Institute indicates that approximately 80 percent of theinterviewed Japanese companies had technologies yet to be commercialized, and thatapproximately half of these companies consider the lag in commercialization a seriousproblem (JETRO 2004a). This demonstrates how many private companies fail to commercializetechnologies despite the high, overall R&D spending seen in their annualbalance sheets. It is believed that the recent lack of Japanese industrial competitivenessis primarily due to poor technology-management (JETRO 2004a). Consequently, establishingR&D in Japan by attracting overseas businesses could be one method ofhelping bolster the nation’s product development capabilities.214