Technology transfer practice in Japanese corporations: meeting new service requirements

Japanese corporations are undergoing radical transition: they have begun to reassess the role, organization, and management of their internal R&D and technology commercialization activities in response to changing market, business, and technical conditions. From large consumer electronics firms such as Matsushita and Sony to the semiconductor and computing conglomerates such as Fujitsu and NEC, these organizations are under considerable pressure to both invent and innovate more rapidly and cheaply than ever before. As technologies become more complex and integrated-such as the convergence of electronics, computing, video, and broadcast television-it is no longer practical to assume that all of a firm's R&D needs can be met internally. This paper looks first at how major Japanese corporations have embraced technology transfer mechanisms such as licensing, joint collaboration, and the outsourcing of R&D to manage these changes dynamically and effectively. Secondly, this paper looks at why Japanese firms' record of managing collaboration and licensing, particularly on an international basis, has been disappointing because of a number of problems and barriers. These difficulties, which are compounded by the further externalization of research and technology and by increased licensing activity, have given rise to a need for new technology transfer services which, until recently, have not been available either within the organization or through local consulting firms in Japan. This paper concludes by outlining strategic and operational guidelines for managing licensing and collaboration arrangements between U.S. and Japanese firms which are also applicable in the general case. These insights are based on the experiences of managing licensing and collaboration programs between Japanese and U.S. organizations from the dual perspectives of two licensing firms-innovation Partners, kk. in Japan and Competitive Technologies, Inc. of the United States.