Work in Other Countries

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Work in Other Countries

• Alternative capitalist models
• Western European Nordic countries, Netherlands,
  Germany, and France
• Japanese
• Industrial districts
• Worker cooperatives
• Plywood manufacturers in the U.S.
• Kibbutzim
• Mondragon

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• Recent research (Carr 2005) finds
• More German public companies adapting aspects of
  American model

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• Western European
• Craft, union
• Welfare corporatist

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Japanese Management Internal Features

• Ideal type, 30 of employees work for firms with
  Japanese management
• Recruitment of employees from school

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Katsuaki Watanabe, Toyota President

• After a 41-year apprenticeship at Toyota Motor,
  Katsuaki Watanabe became its president in June
  2005. Best known for a cost-cutting initiative
  that squeezed suppliers and saved nearly 10
  billion over five years, Watanabe, 63, takes
  charge at a time when Toyota (2004 sales 7.4
  million vehicles) is on track to eclipse General
  Motors as the world's largest carmaker.

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Kunio NakamuraCEO Matsushita

• Graduated Economics Osaka University
• 1962 Joined Matsushita Electric Co
• 1989 President Panasonic
• 2002 President Matsushita

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• Seniority promotion and pay
• Company philosophy, ideology

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Matsushita

• " Recognizing our responsibilities as
  industrialists, we will devote ourselves to the
  progress and development of society and the
  well-being of people through our business
  activities, thereby enhancing the quality of life
  throughout the world."

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Toyotas mission statement

• Innovation into the Future A Passion to Create
  a Better Society
• Through monozukuri manufacturing of
  value-added products and technological
  innovations, Toyota is aiming to create a more
  prosperous society. To realize this, we are
  challenged to achieve the themes below

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• The activities of the Kikkoman Group are founded
  on three core business principles
• To pursue the fundamental principle,
  consumer-oriented
• To provide high quality products and services,
  and promote the international exchange of food
  culture
• To become a company whose existence is meaningful
  to the global society

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Pyramidal Structures
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• Prevalence of habatsu --
• Tall, fine grained hierarchy, short span of
  control

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• Community of Fate culture
• Equitable sharing of rewards and benefits of
  achieving organizational goals ---Bonus system

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• Quality circles worker input
• In manufacturing

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• Ringi group, consensus decision making
• Bottom up communication and decision structure

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External Features of Japanese Management

• Advice cartels
• Collaborations between private industry and
  government
• Enterprise groups

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Enterprise Group
Mkting and Trade
Manufacturer
Bank
Manufacturer
Insurance
Supplier
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Consequences
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Industry Productivity Average hours/vehicle
(Harbour Report 2006)
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Womack, Jones, Roos (1990)
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Globalization and the Mondragón Industrial
Cooperative SystemDoes Democracy Suffer?

• Jan L. Flora
• Iowa State University

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I. What is the Mondragón (Arrasate) Cooperative
System?

• Turnover (sales) in 2001 was over 8 billion euros

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Industrial production household appliances,
machine tools, automotive components, control and
regulation components, construction, machine
tools and capital goods
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• Financial services
• Caja Laboral (credit union),
• social security system (Lagun-Aro), insurance,
  leasing

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• Consumer services
• Supermarket chain
• travel agency chain,
• confinement livestock production,
• food services

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Cooperativism is the third way, Don
José María Arismendi
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Don José María Arismendis Vision

• A cooperative system based on Catholic Social
  Doctrine
• Social development of working classes

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Contrasts between cooperativism and multinational
capitalism

• Alternative Principle of intercooperation
• (networked multinationals)

Courtesy Anjel Mari Errasti Amozarrain
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Mondragón and Globalization

• Exportation to other parts of Europe beginning in
  the 1970s
• In response, Mondragón Cooperative Corporation
  (MCC) was established in 1993.

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Democracy and the Second-Generation Problem

• Strike in 1975 in FAGOR and subsequent
  negotiations strengthened shop-floor democracy.
• Overall process routinization of charisma vs.
  worker mobilization. Are they out of balance?

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Mondragón Cooperative Corporation (MCC)

• Aggressive and strategic expansion of industrial
  plants to other parts of the world joint
  ventures with capitalist firms.
• Strong movement into services, including
  wholesale/retail food marketing, tourism, and
  financial services (1/3 or more of total sales).

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Industrial cooperatives

• The multinationals are only 18 of 119 industrial
  coops, but
• They account for 65 of the turnover (sales) of
  the group

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New MCC industrial dual labor paradigm
I. Cooperative members (40)
Within the coops (and within Spain)
II. Temporary members (5)

• Temporary non-members
• (20)

Employees on contract (35) IV. Foreign
affiliated companies V. Local affiliated
companies
Outside the coops
Courtesy Anjel Mari Errasti Amozarrain
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Relations between parent coop and affiliated
company

• CEOs of affiliated companies are expatriates
  appointed by parent cooperative
• Working conditions and labor relations depend on
  conditions in country where offshoot business is
  located. Based on--
• Legal framework in that country
• Behavior of firms (esp. other multinationals) in
  that particular sector in that country

Courtesy Anjel Mari Errasti Amozarrain
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Modest advances in employee participation in
subsidiaries
Courtesy Anjel Mari Errasti Amozarrain
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Internationalization of industrial group since
MCC established (1993)
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Thesis of cooperative degeneration

• In these times of economic globalization and
  necessary internationalization, in a capitalist
  economy long-term economic success is not
  compatible with the maintenance of cooperative
  and democratic principles.
• Hence, the old Mondragón cooperative system is no
  longer valid, but no new model has been devised.

Courtesy Anjel Mari Errasti Amozarrain