Understanding and Producing
In language there are two sides to your knowledge - your understanding of the language and your ability to produce the language. Your understanding of a language is always larger than your ability to produce in that language - even in your native tongue. To put it simply:
There are many words and phrases that you would not use yourself, but that if someone else used them you could still understand.
This all sounds a bit too lofty, so to put it into terms that fit our purposes:
You can understand more Japanese than you can produce.
So what this means is that you can listen to a conversation in Japanese and understand more parts than you would be able to say for yourself. The same goes for the written word - you can read more than you can write. So why is this important?
In any language that you use, this trend will hold true. You'll always understand more than you produce. Now, what is important to realize is that the size of the gap can change. So in your native language your understanding and production are both quite high, but a professional writer would have an ever higher level of production. In learning Japanese, the gap between your understanding and production could be huge - and that is where problems arise.
In learning Japanese on your own it's very, very easy to neglect producing. Your understanding of Japanese will continue to grow and grow as you study and engage in Japanese media, but you might not have the chance to speak/write if you aren't in a class or in Japan. This means that eventually when you want to speak Japanese, you'll find that you have no idea what to do. Your mind has nothing ready for you to use, because you've simply never done this before.
I've experienced this firsthand. If you read the "About Living Japanese" page, then you know that I went in for an interview in Japanese without having ever spoken it before. I could understand everything said to me, but struggled to form even basic sentences. I hadn't practiced forming sentences before.
It's a lot like the stereotypical guy that spends all of his time bench pressing and working on upper body muscles, but completely neglects leg training. My knowledge of Japanese was like that. Big, bulky understanding, but puny little pencil legs of production. That interview for me was like working on my arms and torso for a year and then trying to enter a marathon.
Yeah, okay... so what is your point?
The point is that you need to begin producing. Now obviously producing at the very beginning isn't going to do you much good. You need a firm base of knowledge to start producing your own sentences. But once you have that foundation, you need to remember to take some time out for working on production.
How do I get started?
I would recommend Lang-8 for the very beginning. Go in and write a few basic sentences about your day or something that interests you. Try to stick to ideas that you already know the words for. See the Tips for Writing Japanese page for some more advice.
If you have never written Japanese before, then keep it very basic. Maybe write five new sentences every couple of days. See what people say about your grammar. You'll most likely get things wrong at first, which is why you want to start simple. Learn from your corrections and try again next time. You can even try revising the old sentences based on corrections and then posting them once more.
For practice in speaking you can try to make a Skype friend on Lang-8. The Japanese people on there would like help with their English, so set up a language exchange! Alternatively, audio tapes can be a big help. If you actually know Japanese and can understand the words being used, then repeating audio tape phrases can help you get a feel for speaking Japanese on your own. They won't be a true replacement for forming your own sentences, but it's a start.
Alternatively, you can start reading sentences aloud from texts that you read. Get a feel for each sentence and actively think about what you are saying. Think about a situation where you would say that sentence, and then try making some changes to fit a new situation. If you don't have someone you can speak the sentences to, then try writing them down and posting on Lang-8 for checking.
When should I start producing?
If you can read the first Yotsubato! volume, then you are probably ready to start producing some sentences. Again, you'll need to start off simple, but Yotsubato! is chock-full of examples. You might even be able to flip through and find a good template for writing your own sentence.
You can also try reading Yotsubato! aloud. As mentioned above, using manga as a template for your own life can help you get a better understanding of the language used. It also serves to "prime" certain parts of Japanese in your mind, making it easier to recall them when you try to speak or write.
Use it or lose it
Production is one of those things that you will always need to work at if you want to maintain your ability. Now that I'm back in the states my ability to speak and write Japanese has begun to wither, and I'm having to get back into it.
If you're taking classes, use them as your time to focus on producing. If you're not taking classes, use the methods listed above to start working on it. You might not care about speaking or writing at all, in which case it's not something you need to worry about a whole lot. But if you DO want to be able to speak and write Japanese, then putting in a little time each week will lead to big benefits down the road.