It's not an "upgrade" or an "evolution" or "progress". Many modern states aren't nation-states at all, including arguably a few pretty significant ones.
The difference between a nation-state and any other sovereign state is that the nation-state is that the nation-state define itself on the basis of a specific group of people (a nation), which shares common geographic, historical, cultural and ESPECIALLY linguistic ties. The nation-state will claim to be THE state for that group of people, and subsequently will generally claim the right to rule any and all areas associated with that group (and anyone who live within them, even if they're from a different group).
Other, non-nation states, instead, define themselves by their territory. They don't claim a right to rule over territory on the basis of "historical association" or over the presence of a certain group in that region, but (in earlier times) because of dynastic inheritance or simple right of conquest, or (today) largely on the basis of treaties and legal documents that define their territories to begin with. Much more importantly, they claim to be the union or assembly of many historico-cultural groups that all happens to live within the state.
France, for example, portrays itself as the nation of one single people, who speak a common language (the Bretons...have some slight recriminations on the issue). It doesn't make much claim on anyone else's territory anymore (although there is a certain movement that seems to think Belgian Wallonia should become French), because World Wars happened, but in theory, it still defines itself along national lines. That doesn't mean that they refuse to let anyone else move in; but they tend to think that people who move in should Frenchify themselves. France is thus both a sovereign state and a nation-state.
Japan, as others noted above, is decidedly a nation-state.
Canada, on the other hand, has a long tradition of NOT defining itself along national lines. The constitution established a level of bilingualism at the federal government, implicitly admitting that there were (at least!) two distinct nations that were equally part of Canada (since linguistic distinction are some of the most important ones in determining what is and is not a nation). The addition of official bilingualism at the federal level strenghtened that, and the recognition of the Québécois nation "as part of a united Canada" in the last few years made it explicit (there's also the whole First Nations angle to possibly consider). Canada is thus very much NOT a nation-state (but it is a sovereign state).
(The Québec independence movement, on the other hand, is rooted in the idea of the nation-state).