1) Submarines - They should have been attacking civilian shipping, not just military.
2) ASW - The lack of investment is inexcusable. Yes Germany and Italy didn't invest much either, but they hardly needed it, unlike Japan.
3) Damage Control - Every member of a ship's crew should have at least some DC training.
4) Crew Transfer - If the IJN has accepted crew transfers, they could have had five carriers at Midway
These issues wouldn't have resulted in major additional expenditure to fix (aside perhaps better ASW technology).
I think it's Dr Mark Bailey of UNSW (ex Lt Cdr) at the Australian Defence Force Academy who studied some of this in detail partly for his PhD. He says that the "lack of investment" in ASW was logical, because the Japanese had already planned to invest in more escorts. However, like the USN and RN, they appreciated that being fairly quick to build, in the real world of limited resources it would be better to concentrate on larger ships until the war broke out.
Where the IJN differed was that for much of the early war, the USN submarines were so inneffective that the IJN decided that the submarine threat to Japanese trade was so small that their limited resources should be spent elsewhere. By the time the USN sub campaign really hit its stride, the IJN was too far behind.
It therefore appears that the IJN's lack of investment WAS excusable; in fact rather logical. No nation with limited resources can afford to throw vast sums at forces that don't seem to be required. Their "error" was that they didn't realise that the USN could fix its torpedoes and its approach and then ramp up sinkings so quickly, but they didn't have enough resources to make more investment in ASW just in case the USN got its act together.
As noted above, the Japanese submarines did attach merchant shipping. However, they were faced with an enemy which would eventually build up overwhelming strength and could afford heavy MV losses - just as they were suffering on the east coast of the USA. The Pacific also did not offer the wealth of targets that the Atlantic did, therefore the "tonnage war" could not be won.
Given that, the IJN's knowledge that they needed a swift "victory" meant that it was reasonable to attack naval vessels which were slower to replace. That meant that the US could find itself at such a miitary disadvantage that they would ask for peace. Yes, we know that was not going to happen, but the Japanese knew that they needed a swift military victory or would face defeat, and targeting naval vessels seemed to offer more chances for a swift victory.
As far as DC training goes,