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"The 4th Industrial Revolution and Economies of System”

The need for industrial system innovation in Japan from the perspective of paradigm shift

Nov. 20, 2020

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The 4th Industrial Revolution (I4.0) and Digital Transformation (DX) require concurrent transformation in various aspects of the industrial system and its surrounding social systems. These various aspects are business models, the architecture and coordination mechanisms of the industrial system, the methods of product and solution development, the competitive environment, industrial and science/technology policy, adult education, approaches to work, etc. These transformations are being driven by a paradigm shift.
In many cases, Japanese companies' approaches to I4.0 and DX have been based on functional silos, produced changes that are too slow and small, and have rarely led to full-scale investment. The reason is that it is not easy for Japanese companies to adapt to the new paradigm, because the new paradigm is different from the paradigm that has supported the past success of Japanese manufacturing companies. It is essential that Japanese companies and the government work from a comprehensive and long-term perspective to design systemic transformations under a change management methodology for industrial and social systems based on “economies of system”.


  1. Introduction
  2. Obstructed State of Japanese Corporations vis a vis I4.0 and DX
  3. Understanding I4.0 and DX from the Perspective of Systematization
  4. The 4th Industrial Revolution Reconsidered
  5. The Various Phases of the Paradigm Shift Demanded by Systematization
  6. Study of the Required Systemic Reforms and Reform Methodologies
  7. Conclusion

Author's Profile

  • Naoaki Fujino

    Chief Researcher

    Industrial Solution Business Development Division & Consulting Division & Systems Consulting Division

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Nomura Research Institute, Ltd.
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