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Learning the R&D System: Industrial R&D in Japan and the Uniter! States Prepared by the Office of Japan Affairs Office of International Affairs National Research Council NATIONAL ACADEMY PRESS Washington, D.C. 1990

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NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competencies and with regard for appropriate balance. lhis report has been reviewed by a group other than the authors according to procedures approved by a Report Review Committee consisting of members of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The National Academy of Sciences of the United States is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the fur- therance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Academy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Frank Press is president of the National Academy of Sciences. The National Academy of Engineering of the United States was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineering programs aimed at meeting national needs, encourages edu- cation and research, and recognizes the superior achievement of engineers. Dr. Robert M. White is president of the National Academy of Engineering. The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters per- taining to the health of the public. The Institute acts under the responsibility given lo the National Academy of Sciences by itS congressional charter to be an adviser to the federal government and, upon itS own initiative, to identify issues of medical care, research, and education. Dr. Samuel O. Thier is president of the Institute of Medicine. The National Research Council was organized by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy's purposes of furthering knowledge and advising the federal govemment. Functioning in accordance with general policies determined by the Academy, the Research Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the govemment, the public, and the scientific and engineering communities. The Research Council is administered jointly by both Academies and the Institute of Medicine. Dr. Frank Press and Dr. Robert M. White are chairman and vice-chairman, respectively, of the National Research Council. Available from: Office of Japan Affairs National Research Council 2101 Constitution Avenue, NW Washington, DC 20418 Printed in the United States of America

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OFFICE OF JAPAN AFFAIRS Since 1985 the National Academy of Sciences and the National Academy of Engineering have engaged in a series of high-level discussions on advanced technology and the international environment with a counterpart group of Japanese scientists, engineers, and industrialists. One outcome of these discussions was a deepened understanding of the importance of promot- ing a more balanced two-way flow of people and information between the research and development systems in the two countries. Another result was a broader recognition of the need to address the science and technology policy issues increasingly central to a changing U.S.-Japan relationship. In 1987 the National Research Council, the operating arm of both the National Academy of Sciences and the National Academy of Engineering, authorized first-year funding for a new Office of Japan Affairs (OJA). This newest program ele- ment of the Office of International Affairs was formally established in the spring of 1988. The primary objectives of OJA are to provide a resource to the Academy complex and the broader U.S. science and engineering communities for infor- mation on Japanese science and technology; to promote better working rela- tionships between the technical communities in the two countries by develop- ing a process of deepened dialog on issues of mutual concern; and to address policy issues surrounding a changing U.S.-Japan science and technology rela . . tlons. :llp. Stay Martha Caldwell Harris, Director Tom Arrison, Research Assistant Maki Fife, Program Assistant Consultant, Sabina Javits Eleanor Westney of MIT and Lois Peters of Rensselaer Polytechnic Institute participated in the discussions and contributed to the report. . . .

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COM]ViITTEE ON JAPAN The Committee on Japan has been established to advise the Office of Japan Affairs on its programs and to assist in defining the contribution that He Academies can make in enhancing U.S. interests through science and technology exchange with Japan. Harold Brown, Chairman Johns Hopkins Foreign Policy Institute Daniel Okimoto, Vice-Chairman Stanford University Justin Bloom Technology Intemational, Inc. Lewis Branscomb Harvard University Mac Destler University of Maryland Ellen Frost United Technologies Corporation Lester Krcgh 3hI Company James Merz University of Califomia, Santa Barbara Yoshio Nishi Hewlett-Packard Company Terutumo Ozawa Colorado State University Ex Officio Members: Gerald Dinneen, Foreign Secretary, National Academy of Engineering William Gordon, Foreign Secretary, National Academy of Sciences 1V Susan Pharr U.S.-Japan Relations Program, Reischauer Institute John D. Rockefeller IV U.S. Senate Richard Samuels MIT-Japan Science and Technology Program Roland Schmitt Rensselaer Polytechnic Institute Hubert J. P. Schoemaker Centecor, Inc. Ora Smith Conductus, Inc. Susumu Tonegawa Massachusetts Institute of Technology

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INDUSTRIAL R&D IN THE UNITED STATES AND JAPAN Beckman Center March 1-2, 1990 U.S. PARTICIPANTS Roland Schmitt (CoChairman) Rennselaer Polytechnic Institute Udo Axen Upjohn Company Harvey Berger Centocor, Inc. Justin Bloom Technology Intemational, Inc. F. Peter Boer W. R. Grace Mary L. Good Allied-Signal, ~c. Donald L. Hammond Hewlett-Packard Co. (retired) Robert J. Hermann United Technologies John P. McTague Ford Motor Company Michael J. Mintz Dow Chemical Japan, Ltd. Geoffrey Nicholson 3M Company Hubert J. P. Schoemaker Centocor, Inc. Barry Whalen MCC JAPANESE PARTICIPANTS Sogo Okamura (CoChairman) Tokyo Denki University Morio Ikehara Protein Engineering Research Institute Satoshi Irnai Honda of America Manufacturing Tokuta Inoue Toyota Motors Reichi Iokibe Protein Engineering Research Institute Tatsuya Kimura Nippon Steel Corporation Furnio Kodama National Institute for Science and Technology Policy Kiyoshi Nagai Toshiba Corporation Tsuneo Nakahara Surnitomo Electric Industries, Inc. Yoichi Ogawa Fuji Xerox Co., Ltd. Yasutsugu Takeda Hitachi Ltd. Michiyuki Uenohara NEC Corporation v

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Preface The Office of Japan Affairs of the National Research Council organized a series of workshops on the differences and similarities in the working envi- ronment for research in Japan and the United States with a grant from the U.S.-Japan Foundation. Understanding these differences is essential in order to expand U.S. scientists' and engineers' access to Japan's R&D system and to enhance mutually beneficial collaboration between the two countries. This report highlights major themes from the third workshop in the series from "Coexistence in a Technological World: Cooperation and Competition in R&D." Reports are available of the first two meetings, held in 1989, that dealt with universities and national laboratories. This report covers the third meeting, "Industrial R&D in Japan and the Unitecl States," held on March 1 and 2, 1990, at the Beckman Center the West Coast facility of the National Academies of Sciences and Engineering. The report was prepared by the staff of the Office of Japan Affairs to record insights gained from the meet- ing, including preparations and follow-up research. U.S. participants in the meeting, as well as the Japanese co-chairman, reviewed the draft and made useful suggestions, but the report does not represent a consensus of partici . . ~ . pants nor IS it a conference proceec legs. . . V11

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