Structured Impediments for Smaller Ventures in Creating New Emerging Industries in a service-Oriented Economy
In contrast to the notable achievements recorded up to the end of the 1980s, Japanís economy is now facing a structurally heterogeneous stage of development. This can largely be attributed to a paradigm shift from an industrial economy to a service-oriented economy that emerged in the 1990s. There is a need for a change in the business model used by industry. First, there needs to be a shift to creation of a functionality development focus. Second, such a shift can be expected to be initiated by smaller ventures since they are relatively free from the impediments of organizational inertia. Third, the removal of institutional impediments that are indigenous to traditional institutions is indispensable. This paper attempts to identify impediments that will hinder efforts of Japanese industry to shift in the direction described above. An empirical analysis is conducted using data for 3,108 smaller ventures in Japan active in twelve emerging new business fields in the manufacturing, service, commercial and construction sectors during 2001. On the basis of a questionnaire survey, structural impediments in creating new emerging industries in a service-oriented economy are identified depending on business activities, vintage of ventures and identities of CEOs. Noteworthy findings obtained include the following: There is a significant relationship between new start-up ventures and economic growth in Japan, The low level of recent entrepreneurial activity in Japan is chiefly due to institutional circumstances, business activities of smaller ventures in Japan biased toward certain fields, significant impediments are diverse and differ depending on venture nature, while existing public support is somewhat stereotyped, more sophisticated support corresponding to the diversity of impediments is necessary.