We have developed a method for use in drawing up a research and development strategy that incorporates a panoramic view of the industrial structure of and is based on the following two features: An "Umbrella industry" wherein the innovations essential to guaranteeing the economic growth of the next generation are realized and an "element industry" that is a constituent of the umbrella industry.

An umbrella industry is defined as an industry that produces socially, economically, and industrially valuable products by configuring an extremely value-adding system in combination with the system that is made up of the parts and materials or hard technology and software technology needed in optimizing the functionality of the overall system.

An element product is defined as the parts and materials or constituents that get integrated into the umbrella industry and the relatively independent software and the industry that produces the actual products is defined as the element industry.

Japan is very internationally competitive with the parts, material, and special material industries that make up an element industry. These products are then integrated into the many umbrella systems throughout the world such as with automobiles, slim TVs, portable music players, mobile phones, etc and support umbrella industries in other countries. Japan has a large share of the high performance steel used in automobiles and home electric appliances as a material and still retains excellent international competitiveness in the field of machine parts and materials, including those for use in the transport machinery, and chemical materials for use in functional chemical products.

The problem is that Japan has lost or did not have the advantage of umbrella industries except with some products such as those for automobiles and machinery. Japan did have the advantage in producing slim TVs, but now products from South Korea and Taiwan have higher international competitiveness. Japan still has the largest share in electronic parts such as middle-size and small LCDs and lithium ion batteries that are integrated into mobile terminals while foreign manufacturers such as Nokia of Finland, Samsung of South Korea, and Motorola of the U.S. have the lions share in mobile phones as a system. In this field Japan has no power within the system whatsoever.

The total profit of the Japanese products that are integrated into a fifth generation iPod of is far less than that of Apple's. In addition to that Apple also further profit from their after-sales service.

Many Japanese element products are integrated into systems globally in the water business. However, the company that enjoys the most profit from it is not Japan and instead France and the U.S. The global water business market will be worth 111 trillion yen in 2025; however, Japan has no powerful as umbrella industry and will only be competitive with element products such as films, of which the market size is relatively small, if the situation remains the same. An umbrella industry approach is currently being promoted in the form of a joint organization at the national level in attempting to rectify that situation.

In meeting the request to enhance the international competitiveness of the industry we took an industrial overhead view consisting of the two pillars of the umbrella industry being the system and the element industry that supports the umbrella industry in identifying a research and development promotion guideline to use in solving the issue of the realization of an umbrella system. We also set the following four conditions for the umbrella system in fulfilling that: In aiming at settling the global issue the necessary technical development will require technological innovations, the realization of those innovations, or that is the umbrella product must have both large social and economic values, and the creation of the umbrella product by Japan should bestow a global advantage and therefore have global potential.

This was then used in proposing 37 umbrella industries through workshops and interviews with intellectuals at the Center for Research and Development Strategy (CRDS) of JST. We will be able to mobilize all the available resources of Japan in concentrating on the issue, reducing any waste, and addressing strategic research and development if industry and the Japanese government both share a common goal of realizing an umbrella industry.

In realizing an umbrella industry that satisfies the condition of the aforementioned technology innovation being necessary we determined to draw up a demand-pull and seeds-forward type research and development strategy which seeks seeds through demand-pulling and then improves them towards the realization of innovations being made. However, in order for this to happen it will be necessary to break down the demand in eventually applying it to the performance and goals that science technology must achieve and the pertinent research theme. The element product that is required for the realization of innovations and a science technology research and development theme that then leads that element product to commercialization will be applied within the matrix consisting of these two pillars.

An example of this is shown as in the overhead view, although incomplete yet(Note). The product and science technology research and development theme required in the realization of an umbrella product can be understood as a package deal when seen from the point of view of an umbrella product, while a core research and development theme that requires a common breakthrough for many umbrella products exists when seen from the point of view of an element product.

The thing that I would like to emphasize here is that there are large, social and systematic technology issues that cannot be covered alone by respective element products in the realization of an umbrella industry. They cannot be attributed to a specific element industry and are often specific to the realization of an actual umbrella industry. The matrix used in applying them has also been prepared in the overhead view. I also provide some examples in that view. The science technology theme that is being reviewed here is merely one that will be necessary in the optimal application to science technology of an innovation policy.

Chinese / French / Japanese