The Existence of SMEs That Surpass Large Corporations🏭 The Importance of Productivity Improvement Strategies That Embrace Change Without Fear of Risk🏆: 2026 White Paper on Small and Medium Enterprises No. 12

A lecture series that breaks down the 2026 White Paper on Small and Medium Enterprises as
simply as possible!
This time, the theme is
a 'shift in management mindset' and 'concrete actions' to boost labor productivity🔥

So far, we have used data from the White Paper on Small and Medium Enterprises to confirm
the severity of the labor supply constraints facing our country and
the disparities in productivity across industries📉.
Some may have the stereotype that
'SMEs have lower productivity than large corporations,
so wage increases are difficult.'
However, the data in the White Paper gives the impression that it
comfortably overturns that image!
Once again, using data from the White Paper on Small and Medium Enterprises,
I would like to organize together the potential hidden within SMEs
and the two major approaches effective for improving productivity🧐

The 'Potential of SMEs' Seen in the Distribution of Labor Productivity

First, let's check the 'distribution of labor productivity' by company size
(Figure 1 below)🔍.
This graph divides groups of companies of each size
into layers (percentiles) based on their level of productivity
and shows long-term trends.

If you pay attention to the red dotted line (the median for large corporations) drawn
on the SME graph (right side),
a very interesting fact becomes apparent🔖

✅① Top-tier companies that are on par with large corporations

• Among SMEs, the group of companies located in the top tier of labor productivity (75-90th percentile, etc.) is at a level that clearly exceeds the median for large corporations (solid red line)👍

This is irrefutable evidence that 'even small companies,
depending on how they are managed, can achieve labor productivity
as high as that of large corporations'!
In other words, the reason the average value for SMEs as a whole looks low is
because of the large variance in the lower tiers,
and individual companies possess sufficient potential
to surpass large corporations📈

'Two Approaches' Effective for Improving Labor Productivity

So, to achieve high productivity that surpasses large corporations,
what kind of management strategy should be taken specifically?
The White Paper points out the importance of not chasing short-term profits,
but taking risks to restructure business and organizational structures
from a long-term perspective💎

✅Strategy for 'Increasing' Value-Added Amount (Output: OUTPUT)
This is an aggressive investment to grow the overall pie.
The following five items are listed as concrete initiatives.

• Growth investment(Capital investment for growth)

• Research and development

• Human resource development

• Promotion of price pass-through

• Business succession/M&A(Restructuring of business structure triggered by these)

✅Strategy for 'Optimizing' Labor Input (Input: INPUT)
This is a defensive and structural investment to allocate
limited resources most efficiently.
The following two items are listed as concrete initiatives.

• Labor-saving investment

  1. AI utilization/Digitalization

The summary of this lecture is as follows✨

• The top tier of SMEs has already achieved high labor productivity that exceeds the median of large corporations, and there is sufficient potential for even small-scale businesses to achieve high productivity.

• To improve productivity, two axes are necessary: "increasing value-added" through growth investment and price pass-through, and "optimizing labor input" through labor-saving and AI utilization.

• The greatest key is the "strategy" of the manager who challenges transformation from a long-term perspective without fearing risk, rather than pursuing short-term profits.

It is not that "it cannot be done because it is an SME,"
but rather a positive message that "precisely because it is an SME,
it can transform speedily through a single decision by the manager"
comes through from this data.

With this, we will conclude the
analysis part regarding the current state of labor productivity🙏

From next time, we will change our perspective slightly
"Trends and Business Conditions of SMEs and Small Businesses"and
while taking up macro data such as
the 2026 White Paper on Small and Medium Enterprises
we would like to continue reading through it🔥

Thank you for watching until the end👍
If you found this article helpful, it would be encouraging if you could support us with a like or
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Reference links and recommended texts📚

✅Small and Medium Enterprise Agency
What is a Small and Medium Enterprise Management Consultant

White Paper on Small and Medium Enterprises - Small and Medium Enterprise Agency - Ministry of Economy, Trade and Industry

2026Full text of the "White Paper on Small and Medium Enterprises"

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