Abenomics has broken the shrinking trend of the Japanese economy, which had continued for a long time. Now is the time for top management of the private sector to make utmost efforts in order to generate a positive impact in the "third arrow" of Abenomics, i.e., the Growth Strategy. We must create new values for customers by means of technological innovation under the leadership of the private sector. Specifically, we must not only ask the government for leadership, but also take up the challenge of innovation by taking risks and drive economic growth.

The key to innovation first requires us, as top management, to create the future vision of our own businesses. To achieve such a future, we need to develop a scenario for the future, as we constantly learn about leading-edge technologies of the world and anticipate future technological development. If we cannot find technologies in-house that will enable us to achieve our visions, we must look for them around the world. By getting out of the principle of self-sufficiency, we need to boldly turn for open innovation.

We at Komatsu introduced driverless dump trucks for autonomous haulage of minerals in overseas mines in 2008. To successfully develop and operate them, we proactively incorporated technologies of venture businesses especially in the United States. It has been difficult for mining companies to secure drivers, because of the strenuous conditions of mines. Our dump trucks have helped them reduce their operating costs, while we have been able to develop high value-added products. In this way, we have successfully established a win-win relationship.

In Japan, private sector companies donate only JPY90 billion to universities, i.e., only 0.7% of JPY12 trillion of their R&D expenses. In Germany, by comparison, private sector companies donate JPY240 billion, i.e., 3.8% of JPY6 trillion of their R&D expenses. Compared to Germany, where Fraunhofer-Gesellschaft plays the role of bridging universities and public research institutes for the commercialization of their technological seeds, Japan doesn't have sufficient bridging functions. Furthermore, human resource mobility among industries, academia and government organizations is far less in Japan.

Now is the time for top management of the private sector to have proactive attitudes to challenge new innovation and actively spend more funds for collaboration with academia and government organizations, expand human resource exchanges with them, and promote M&A or collaboration with venture partners having cutting-edge technologies.