Summary of the Report
 

International Forum on Social Capital for Economic Revival

"How Social Capital Can Expand Business Opportunities"

March 25th, 2003
Kumi Fujisawa
Director, SophiaBank, Limited

   The collapse of keiretsu due to the effects of post-industrialization in Japan has resulted in a loss of business opportunities for small and medium-size companies that function as subcontractors. I would like to consider the relationship between social capital (SC) and the possible expansion of business opportunities for such small and medium-size subcontractors. As one approach to the revitalization of these subcontractors, I expect to see the birth of new keiretsu ? specifically, the formation of a virtual corporate group of such companies around a specific axis. I believe the most important axis in establishing this keiretsu is SC. I would point to certain"regional communities"established around industrial concentrations as representative examples of this phenomenon.


Case: Activities of small and medium-size companies in a regional community : Kyoto Youth Association of Small and Medium-size Companies in Machine and Metal Industries (Kiseiren)

   Kiseiren is a group of young presidents of small and medium-size companies in the metal processing industry in and around Kyoto; it is comprised of 72 companies. Through management discussions and an honest exchange of frank criticism based on factory visits, they aim to go beyond the strictures that can sometimes hamper family businesses and gain the qualities and qualifications necessary for effective managers.

   Kiseiren's web site: http://www.kiseiren.com


 
   Characteristics of the wisdom that lies dormant in local communities:
      1. Unspoken wisdom (this is invisible and cannot be expressed in words)
      2. Personal wisdom (acquired by the particular individual through his/her long years of experience)
 
   Steps to linking this wisdom to business opportunities:
      1. Uncover the wisdom and its whereabouts: the need for effective communication
      2. Borrow the wisdom (exchange the wisdom with others): the need for sympathy
      3. Put the wisdom to use: the need for a knowledge eco-system

   SC that produces businesses based on the regional community
   Knowledge capital (accumulation of wisdom in industrial concentration)
   Relationship capital (relationships strengthened based on community land)
   Trust capital (trust strengthened based on sympathy)

(End of summary)


   Personal history

   Kumi Fujisawa is currently the director at Sophia Bank, Limited (a think tank); visiting associate professor at Tama University; and broadcaster on 21st Century Business Class, an educational program on NHK.
   Graduated from Osaka City University in 1989.
   After working for Japanese and foreign investment fund management companies, founded the first investment trust evaluation company in Japan, in 1996. Sold the company to S&P in 1999.
   Has authored many introductory books on the topics of investment and economics.