The Journal The Authority on Global Business in Japan

After decades of urban migration, the outlook for rural Japan is bleak. In the coming years, thinning populations outside major cities may impact the country as a whole. Concentration of business and education in Tokyo and Osaka has created a digital divide. For Japan to remain competitive on a global scale, this divide must be bridged.

On July 29 at Tokyo American Club, Oracle Japan Senior Vice President Hiroshige Sugihara presented his plan to remedy the problem through digital aid. With a video of Oracle Team USA’s first-place finish in the 34th America’s Cup, Sugihara eased the crowd of 153 into the core of his vision: Big Data. The use of 300 sensors on the boat and its crew, he explained, was key to victory. The same concept can be used to solve Japan’s migration problem.

The roots of Sugihara’s vision go back to a meeting with Oracle co-founder Larry Ellison. Recounting his visit to the latter’s California home in October 2013, Sugihara explained how his journey with Oracle Japan began. “It is hard to understand what the Japanese are thinking, so I wanted to make sense of that.” Ellison and Oracle set him on the right path.

Today, Sugihara sees the cloud and Big Data as the key to revitalizing rural Japan. Oracle’s Enterprise Resource Planning (ERP) Cloud allows businesses to increase productivity, lower costs, and improve controls. But on a more personal level, the power of cloud-based processing and resources enables those living outside urban centers to achieve success that previously would have required migration. Through these tools, the world becomes more accessible regardless of one’s location, and the cost of doing business or maintaining a career is vastly reduced.

“Digital is everywhere,” he said, pointing out that the world is changing rapidly and we must adapt. “We are living in a VUCA world,” he continued, a reference to the volatility, uncertainty, complexity, and ambiguity of the 21st century.

One thing that’s certain is that the pace of technology adoption by the masses is accelerating all the time. Sugihara demonstrated this through a chart showing the time required for inventions to reach 50 million users. Whereas the telephone took 75 years and the television took 13, the Internet took four and Japan’s ubiquitous messaging platform LINE took only a year and three months. As for current sensation Pokémon Go? Just seven days.

This shows that the time is right for Oracle and others to apply technology to improve the lives of those in rural Japan—and to set the country as a whole on the path to a brighter future. ERP Cloud expands markets, business, user bases, finance, business intelligence, and talent management. And cloud-based technology is now a part of daily life for most people in Japan—even if they don’t realize it.

The challenge is a big one. By 2020, those aged over 65 will make up 29 percent of Japan’s population. The country’s population will also decrease by 2.5 million people. “Just doing what was successful in the past will not work anymore,” Sugihara pointed out. “[But] if our approach to IT changes, we can achieve a lot of new things.”

How quickly and in which direction technology takes us depends on the public, he explained. With Japan’s aging population, “we’re going to have to approach the pieces of the puzzle of Japan differently.” Sugihara calls his approach to bringing technology to rural areas “digital aid.” This comprises four areas: mobile, social, Big Data, and the Internet of Things.

The road map seems clear now, but when Sugihara was sent by Ellison three years ago to help guide Oracle Japan, the company lacked a vision. So he created one: to become the number-one cloud company and most admired company in the industry by 2020.

But it isn’t just about Oracle. Sugihara’s vision aims to make Japan a country to be admired. For despite a declining population and a growing digital divide, technology and Big Data can lead us to victory—just as it did Oracle Team USA.

Christopher Bryan Jones is Editor-in-chief of The Journal. Originally from Birmingham, Alabama, he has lived in Japan since 1997.
We're going to have to approach the pieces of the puzzle of Japan differently