Inter-Firm Innovations Can Solve the Wage Differentials in the Supply Chain: Collaborations Motivated by Negotiated Transfer Pricing

The following sections are included:Theme of This ChapterJapanese Causes of Poverty and How We Should Cope with Wage DifferentialsWhy Can the Inter-Firm Network Reduce the Costs?: Negative AspectDemand for Higher Wages by the Japanese Government to the Industrial World: The First Phase MovementIncrease of the Parts-Price Facing the Yen Currency Depreciation: The Second Phase MovementProblems to be Considered in the Pay Rise by the Government LeadershipCollaborations During the Yen Currency Depreciation PeriodsCollaborations During the Yen Currency Appreciation PeriodsNegotiation between Auto-Maker and Parts-Supplier for Determining the Parts-Price in the Product-Development Phase: Application of VE or Target CostingHow to Adapt to the Parts-Price Reduction Requested by the Auto-Maker Twice a Year: VA or Kaizen Costing Applied to Achieve the Newly Reduced Target Cost for the Part in the Manufacturing Phase of the Existing ModelTo Assure a Sustainable Supply Chain: Incentives to Motivate the Members’ ContributionsConcluding Summary for Continuous EvolutionsEndnotesAppendix 1 to Chapter 6: On the Moral Sentiments of Adam Smith Compared to Soseki NatsumeAppendix 2 to Chapter 6: Case Study of Global Risk-Spreading for Continuous Innovation: How Kikuchi Gear Has Developed Their “Economy of Scope”