Productivity Improvement Strategy Using DX for Japanese Small and Medium Manufacturing Companies

Abstract

Purpose: Digital technologies, which have played a major role in driving the era of the Fourth Industrial Revolution, are now not only a means of maximizing their competitiveness to small and medium manufacturing companies, but also use them to deepen their ties with related parties such as producers, suppliers, and consumers. Therefore, these digital technologies make it possible to create new values and higher values for small and medium manufacturing companies in Japan today. The purpose of this paper is to focus on what is the fundamental purpose of promoting digital transformation by small and medium Japanese manufacturing companies in recent years, and what are the effects of promoting such digital transformation. In addition, the characteristic that appears in the process of developing digital transformation by introducing such digital technology to its management activities is to analyze cases using the operation model of digital transformation. Research design, data, and methodology: Based on previous studies so far, this study presents a DX operation analysis model of Japanese small and medium manufacturing companies to identify and analyze the characteristics of Japanese small and medium manufacturing companies’ introduction and operation of DX in their production activities, and focuses on the cases of small and medium manufacturing companies corresponding to the three types in such models. Results: In order to enable Japanese small and medium manufacturing companies to develop production activities suitable for the new digital era amid rapidly changing environmental changes in the era of the 4th industrial revolution, above all, a change in the business model is required to maximize the productivity and added value of their products. Through the DX operation cases of small and medium manufacturing companies in Japan, we were able to see how effectively and efficiently they are coping with the challenges related to productivity improvement and technology succession, which were their ultimate problems, by using digital technologies such as IoT, AI, big data, and cloud. Implications: Since the problem of low birth rate and aging population is emerging as a serious social problem in Korea, the technology succession problem related to the manufacture of molds by skilled engineers in Japanese small and medium manufacturing companies is thought to be a phenomenon that may soon occur in Korea. Therefore, the various DX operation cases of small and medium manufacturing industries in Japan have great implications for small and medium manufacturing companies in Korea.