The digital transformation of small and medium-sized enterprises (SMEs) is critical to Japan’s ability to reshape its economy. However, a key question is whether Japanese SMEs are ready.

As labor shortages intensify and artificial intelligence transitions from hype to practical implementation, how are companies modernizing the systems that power everyday commerce? To help answer these questions, we’re joined by a resident expert.

Who is he?

Real Gaijin was joined by Tiby Kuruvila, the Chief Technology Officer of POS+ (Postas). POS+ is one of Japan’s leading cloud-based point-of-sale platforms, serving the restaurant, retail, beauty, and healthcare sectors. With more than 25 years of experience in enterprise software, AI, cloud architecture, and entrepreneurship in Japan and India, Tiby has started companies, mentored startups, and helped thousands of businesses embrace digital transformation.

On the agenda

We discussed AI adoption, Japan’s unique technology landscape, and how to build successful products and teams across two distinct business cultures.

Key Takeaways

Today’s discussion flew by. It is difficult to select only a few key takeaways, but these were mine:

* AI is transforming point-of-sale systems from mere record keepers into intelligent business advisors: Traditional point-of-sale (POS) systems tell owners what happened yesterday. The next generation will predict what will likely happen tomorrow. Instead of merely tracking sales, AI-powered systems will forecast demand, optimize staffing, recommend inventory purchases, identify profitable customer behavior, and communicate recommendations in natural language. The long-term vision is for the POS system to become the “secondary brain” — and eventually the operating system — for an entire business, rather than merely processing transactions.

* Japan’s greatest obstacle to digital transformation is not technology—it is trust: Throughout the interview, Tiby emphasizes that Japanese businesses rarely adopt new technology solely because it offers a better return on investment. Instead, adoption depends on building long-term trust. Sales cycles may last a year or more, but once a relationship is established, customers often remain loyal for many years. For foreign technology companies entering Japan, demonstrating reliability, cultural understanding, and long-term commitment is often more important than showcasing technical superiority.

* Labor shortages are making digital transformation a business necessity rather than a luxury: Japan’s aging population and shrinking workforce are forcing businesses, particularly restaurants and SMEs, to automate routine operations. Technologies such as QR code ordering, AI-assisted forecasting, CRM systems, and workflow automation allow companies to serve more customers with fewer employees while improving customer service. Many technologies evolve from being “nice to have” to becoming essential when labor shortages threaten business survival.

* The future belongs to organizations that combine human judgment with AI execution: Rather than replacing people outright, AI will perform more repetitive, administrative, and analytical tasks, allowing humans to focus on strategy, creativity, and decision-making. Tiby argues that developers, managers, and business leaders will spend less time producing work themselves and more time designing systems, defining objectives, and directing AI agents. This shift enables dramatically smaller teams to accomplish work that previously required many more employees.

* Success in Japan requires localization, patience, and solving uniquely Japanese problems: Tiby advises entrepreneurs that simply translating an overseas product into Japanese is not enough. They must design products specifically for the Japanese market, address challenges such as an aging society and labor shortages, build local relationships, respect Japanese business processes, and maintain exceptional customer support. Those willing to invest the necessary time to earn trust are rewarded with exceptionally loyal customers and long-lasting relationships.

Timeline

Substack does not yet have the functionality to allow you to use a link to jump to a specific section like YouTube’s “chapters.” Please refer to the times listed below to navigate through our hour-long conversation. Thank you for your understanding.

Links

* POS+: https://www.postas.co.jp/

* LinkedIn: https://www.linkedin.com/in/tibyk/

#JapanBusiness #DigitalTransformation #EnterpriseAI #RealGaijin #リアル外人

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