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Japan just isn't taking digital transformation seriously enough

It’s a bad sign when the digital minister chuckles about the prominence of floppy disks at an overseas tech conference

A digital matrix overlaid on the Japan flag

Japan is known around the world for its technology – in high-speed rail, robotics and even toilets. Even watching the recent Bullet Train offers a glimpse into how Japan is perceived, with the film set on arguably the country’s most famous technological landmarks. The story is very different at home, however, with businesses and the public sector alike struggling to modernise. This struggle to digitally transform, which puts Japan at risk of restricting its future growth, is down to the government’s fragmented leadership, businesses in thrall to an archaic working culture, as well as a shortage of tech talent. 

Given these challenges, it was shocking to witness Japan’s digital minister Taro Kono treating the subject so lightly at Singapore’s STACK 2022 Developer Conference. In a short video message, with his head beaming high above the stage, Kono smiled while telling the audience they might have heard about Japan’s war against the floppy disk and fax machine. “We are so fed up with analogue technology,” he quipped, adding he thinks Japan is lagging behind on digital transformation. “We hope we can catch up with you soon.”

Japan isn’t just “lagging behind”, but suffered a full-on “digital defeat” during COVID-19. The nation struggled to implement an online vaccine booking system and had to resort to physical tickets. It was so slow that prime minister Yoshihide Suga called in the armed forces to help and, after several more digital embarrassments, led to the creation of the digital agency, which Kono spearheads. As its head, it might have been worth Kono giving the impression he takes his job more seriously, especially when failing to evolve led to a logistical catastrophe during a global pandemic.

Japan’s time to digitise is running out

Kono “war” on the floppy disk made for a great soundbite, and even raised his profile internationally. Based on his appearance in Singapore, and, it seems he only sought to repeat his material and give further oxygen to this talking point. It might, though, be time to get serious about digital transformation and face up to the potential consequences. 

In Singapore, there couldn’t be a greater contrast between two countries – one sailing ahead and one struggling to stay afloat. Kono’s digital transformation agency, established on 1 September 2022, is understaffed. While Singapore’s GovTech employs more than 2,000, Kono’s agency employes just 700. This is despite Singapore’s much smaller population. Indeed, Japan’s leaders might do well to take inspiration from what Singapore is aiming to achieve. Its various agencies are working on a number of exciting projects, with a helping hand from GovTech, from digitising food production to preserving natural greenery. 

Instead of concrete ideas, Kono talked about “warm hearted” digital transformation, which means technology that can reach people across the country, including marginalised groups, to create a more inclusive society. There’s nothing wrong with that, but if you can’t implement any kind of meaningful digital transformation to begin with, technology won’t reach anyone.

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This is against a backdrop of the country shedding population fast, with half a million “disappearing” each year. This is mirrored in the number of people dropping out of the workforce. With depopulation and an ageing society to contend with, Kono pits technology – in a nebulous way – as the answer to these challenges. This is despite many previous efforts running into problems, with no strategy to overcome them in future.

The city of Maebashi, where the government is connecting its national My Number ID card – kick started in 2016 – with a payment system for transportation, is a good example of how even new projects are faltering. Despite being live for a number of years, the government has struggled to attract citizens to register for the ID card. Soon, it’s set to be linked with driving licences and, by 2024, citizens need to sign up or potentially lose access to public health insurance. Despite its growing significance, though, people can only register for one by filling out a form and sending it through the post – another analogue process for the pile.

Digital ambitions should begin at home

Kono was keen to point out Japan is hosting the G7 Summit next year, where it hopes to take the lead on all things digital. During the summit, he wants to lead talks on data free flow with trust (DFFT), which looks to govern data flows through international cooperation. Yes – the country still using floppy disks hopes to push for better international frameworks.

The digital minister even analysed the data strategies employed by other countries. He says China, an authoritarian government, has a monopoly over personal data. Europe on the other hand, has GDPR where privacy comes first and last, and with which it’s hard to move data across borders. Lastly, he mentioned the US – a “wild west” when it comes to data

As for Japan’s model? It’s looking to hit the “right balance” between Europe and the US. By appearing to analyse these rules without offering an original model for Japan, though, Kono is merely giving the impression he can talk the talk on the world stage. Meanwhile, everyday services, in Japan, continue to suffer. It’s almost as if the government is leapfrogging the issue, focusing on abstract ideas international treaties, while unable to bring the change he advocates for at home, where he has the opportunity.

There could be more at play here than meets the eye. Under the current prime minister, Fumio Kishida, three cabinet members have left within a month. His approval ratings are also sinking. Although Kono is part of the same party, he could be lining himself up for the top job if Kishida does decide to go, especially since he was seen as the frontrunner in the previous leadership election – which he lost.

Leading his agency might signal he advocates for change, but Japan still has a mountain to climb. Meanwhile, If Kono did depart his current role, it further underlines just how fractured digital leadership is, with three ministers leading the agency in just over a year.

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Kono appears to be weaponising digital transformation to engage with his counterparts overseas while neglecting the core issues domestically. Regardless of his own ambitions, the need for concrete digital transformation in Japan continues to grow, with the economic consequences worsening the longer this remains unaddressed. 

Japan s in serious trouble, with political leaders who are neglecting to implement genuine change and public services crying out for streamlining. COVID-19 already exposed major cracks in Japan, leading to a devastating effect on citizens. Instead of cracking wise about floppy disks, it might be time to get serious and recognise the desperate position Japan is in.

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