In Japan, it has been more common for new technical opportunities to be exploited by established companies moving into new fields. This chapter examines this phenomenon and tries to explain the factors on which the success or failure of such efforts have depended. It presents case studies for two types of companies: tethered spin-offs — spin-offs that the parent companies support by various means and over which the parents maintain partial ownership and control, and established newcomers — established companies that have moved into new field of technologies that are significantly different from their current core businesses. The case studies suggest that attempts to innovate in new fields of technology usually do not lead to internationally competitive operations. Some of the reasons may be unique to Japan, for example, the prevalence of lifetime employment that prevents established newcomers from hiring experienced researchers and managers, and the deference paid to the welfare of a corporate family that may prevent established newcomers and spin-offs from competing vigorously. However, other reasons are not unique to Japan. Thus, in other countries as well, established newcomers and tethered spin-offs may face similar difficulties.
Keywords: Japanese companies; spin-offs; venture companies; established newcomers; tethered spin-offs; lifetime employment
Chapter. 17014 words.
Subjects: International Business
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