Both Japanese and American firms have capitalized upon the use of innovative forms of technology and have changed the way the world does business. This is embodied in the creation of the wildly popular Toyota Prius as well as the ubiquity of Microsoft Windows on almost every computer screen around the world. However, although examples of successful American and Japanese firms are easy to find, both countries have radically different corporate cultures. America has a business culture of entrepreneurship and individually-generated innovation, while Japanese stresses the value of having stable corporate institutions that hone talent in a collaborative fashion.
             America's core innovative advantage is in deploying entrepreneurship funded through the strategic use of venture capital. Entrepreneurs profit by taking risks like Bill Gates, who made the decision to drop out of Harvard and begin a company in his garage, the company that became Microsoft. But Japanese companies, like Toyota, stress continuous improvement-creating a bureaucratic system that sets benchmarks, and then tries to improve upon those benchmarks and eliminate defects. The American dream is to start one's own business, and to be independent of a corporate clock and a boss in a grey flannel suit. The Japanese dream to get into an elite university, and to use that degree to become part of a great company for the duration of one's working life.
             American companies, to "make things better," stress radical innovation, redefining the market, and developing new technology to create efficiency. In contrast, Japanese companies emphasize evolution, and using teams and workgroups to create innovative solutions that generate value for the company and the consumer. Rather than creating completely new technology, Japan has often radically improved upon existing technology, such as Japan's improvement of the American automobile industry's manufactur...