Exploring Factors Behind the Weakening Competitiveness of Japan's Semiconductor Production System: from the viewpoint of meta-level integration capability

Author Name CHUMA Hiroyuki  (Faculty Fellow, RIETI / Professor, Hitotsubashi University Institute of Innovation Research)
Creation Date/NO. May 2006 06-J-043
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The competitiveness of Japan's semiconductor industry fell sharply in the latter half of the 1990s. This paper attempts to explore structural factors behind this by focusing particularly on production systems. In doing so, special attention is paid to the rapid increase in complexity of technologies and markets, a phenomenon brought about by the "self-propagating" evolution of information technologies of the semiconductor industry's own making. Such an increase in complexity calls for highly specialized knowledge/know-how. At the same time, it is necessary to create a mechanism for combining such knowledge/know-how so as to ensure its cumulative and agile generation in an integral form. Japan's semiconductor industry, however, has yet to create such a mechanism for its production system. This paper attempts to identify factors behind this and find clues toward solving the problem. Although this research is specifically focused on semiconductor production systems, the mechanism for the occurrence of the problem can be observed in various aspects of the industry as if it were fractal patterns. In this regard, the perception that the time for a production-oriented approach is over and now is the time for a design-oriented approach is, albeit generally correct, fraught with substantial danger. This is due to the high probability that the root cause of the stagnation of the Japanese semiconductor industry is identical to that of the weakening of the production system. That is, the reasons behind the Japanese semiconductor industry's inability to effectively produce a new post-DRAM technology driver that can lead the world's semiconductor industry are perceived to be identical to the factors limiting the speed of occurrence of the cumulative accumulation of integral knowledge/know-how (a new process that needs to take place at an abstract level, a rank above the conventional level).