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4 Questions for a Smarter Society in Japan

December 14, 2017

The economic strains of Japan's aging workforce are requiring bold new policies. Japan's Society 5.0 promises a utopian future where innovation has created a smarter community capable of finding solutions to the most pressing societal and economic problems. However, amongst all of the cheerleading for this effort, there has been a lack of critical analysis of Society 5.0's potential to create new risks and negative impacts. In any transformation, there will be winners and there will be losers. Much of the world will be watching with great interest as Japan attempts to manage their transition toward a smarter society.

Society 5.0 is Japan's policy touse the same types of innovation and technology used to improve industry for anation-wide transformation of society. This transformation is divided into five major areas; Ministries & Agencies, Legal, Technologies, Human Resources, & Social Acceptance. Every previous transformation of society has been accompanied by friction and resistance by reluctant citizens. This is especially true for older members of society and established businesses that are comfortable with the current system. This is concerning since Japan's average age is the among the oldest in the world and also hosts some of the world's most risk-averse corporations.

Japan's Society 5.0 is largely driven by the need to address the nation's shrinking workforce, which poses a serious economic threat that could cause massive strain on public spending and industry productivity.This demographic problem is also a global concern, with the number of people aged 60 or above is expected to double by 2050 and more than triple by 2100. Japan needs to find ways that technology can help all citizens including women, the elderly, and international workers to participate actively in this new type of society.

Key challenges for Society 5.0 will be:

  1. How will Japan train displaced workers for a new type of society?
  2. How will Society 5.0 provide care for an aging population?
  3. How will Japan get people to completely rethink the meaning of work?
  4. How will Japan create a framework for Big Data sharing and security?

Society 5.0 seeks to answer these questions and limit negative effects by seeking participation byall members of society. Policymakers want everyone to feel like they have a voice in this transformation in order to gain greater society-wide acceptance.

1. How will Japan train displaced workers for a new type of society?

A large challenge to Japan's Society 5.0 plan is how retraining will be accomplished for workers who lose their jobs because of innovation, most of whom will be older and with few technologicalskills. What happens if innovation is too effective, and an efficient self-driving car network puts tens of thousands of older cab drivers out of work overnight.We have already seen the legendary New York taxi market brought down by car sharing services like Uber & Lyft, with Tokyo likely to follow suit.

2. How will Society 5.0 provide care for an aging population?

Serving the country's growing aging population will continue to be a major challenge as boththe number of seniors and deficit of caretakers increase. In a smarter society, advanced technology like robots can work 24 hours a day, never get tired or impatient, and never call in sick. However, can they ever replace the sincerity or improvisation of a human caretaker or the healing power of a human's touch? The type of innovation used in industrial applications may lead to a negative impact in a healthcare setting. On the other hand,if automation can complete routine tasks and free up caregivers to spend more time connecting with their patients, it could provide a better overall healthcare experience.

3. How will Japan get people to completely rethink the meaning of work?

Society 5.0 is a drastic rethinking of what work means to the Japanese household.It promotes the possibility to choose when, where and how to work in ways that support the natural flows of life. This flexibility would allownew mothers to return to work, and for fathers to spend more time with their families. However, it will be very difficult to change societal values overnight. For example, solving other issues like rampant "service overtime" with governmental and business association mandates has largely been a failure.

4. How will Japan create a framework for Big Data sharing and security?

Companies and Japanese ministries currently have no motivationto share what they see as highly valuable datawith others because they feel it helps them maintain a competitive advantage. Ironically, the economic potential of tapping this ”Big Data” could be potentially massive. The government and its partners will need to create an atmosphere of mutual trust and financial incentive to get more parties on board. There would be little interest for a company to share valuable data if there was a reasonable chance that the data could be exploited by a domestic or foreign competitor.

If Society 5.0 is implemented well, this policy has the potential to improve the lives of millions and create a smarter society that unleashes the creative energy and productivity of all its citizens. However, while Society 5.0 has the potential to greatly enhance lifestyle convenience, it will also likely increase social complexity. This major transformation may not go sosmoothly since as many are forced to adapt to new & untested systems. How Japan navigates this important yet fragile transformation will be of great interest to leaders and decision makers across the globe, who will themselves soon be dealing with many of the same economic and demographic issues.

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