Hybrid Management of Technology Toward a Service-Oriented Economy : Co-Evolutionary Domestication by Fusing East and West

Japan's high-technology miracle in the industrial society up until the end of the 1980s prompts the postulate that co-evolutionary dynamism between innovation and institutional systems is decisive for an innovation-driven economy and also that Japan indigenously incorporates an explicit function in such dynamism. However, Japan's contrasting economic stagnation in an information society resulting from a "lost decade" in the 1990s prompts another postulate that such stagnation can be attributed to a system conflict between a new paradigm in an information society and traditional business model moulded by organizational inertia and also that an innovation-driven economy may stagnate if institutional systems cannot adapt to innovations. These postulates provide a reasonable explanation for the noteworthy surge in Japan's new innovation in recent years in its high-technology firms. This reactivation can be attributed to the co-evolution between indigenous strength developed in an industrial society and the effects of cumulative learning from competitors in an information society, with co-evolution facilitating the emergence of hybrid management of technology by fusing "east" (indigenous strength) and "west" (learning from and corresponding to a digital economy).This paper attempts to demonstrate the foregoing hypothetical views and extract lessons from Japan's success and failure over the last three decades by means of an empirical analysis focusing on the self-propagating dynamism typically observed in a mobile phone-driven innovation and also the co-evolutionary domestication initiated by Canon.