Times Are Changing
Who would have thought it possible that the once mighty American automobile industry would turn to its most successful competitor for help in shoring up its waning fortunes? Yet this is exactly what is happening today in the form of joint ventures and alliances between the American and Japanese automakers, both in the United States and in Canada.
Because of such mergers, some auto plants are producing different models of cars with the same basic structure. For example, a plant near Detroit is producing a Mazda as well as a Ford model, which, though they look different, are essentially the same car. In these joint ventures, cars are built by U.S. workers using Japanese management and designs, a simple economic strategy that benefits both parties.
However, blending two very different approaches to work in these hybrid factories is creating managerial complications. In the old American style of managing there is a sharp and adversarial division between workers and managers; in the Japanese style there is a blending of people regardless of their position. For example, the Japanese workers and bosses wear identical uniforms, and there are no reserved parking spaces or separate dining rooms for executives.
Adopting Japanese methods has led to unexpected results. General Motors officials were shocked to learn that their highest quality car was the one produced at the New United Manufacturing Moto Inc. plant in Fremont, California, the GM-Toyota joint venture known by its acronym, NUMMI. This plant has a low level of automation and technology and had a longstanding reputation as a labour-relations disaster when it was managed by GM. Though still staffed by the same ex-GM workers, Toyota management has made the workers into an efficient, quality-conscious workforce. As a result, GM managers from the Fremont plant are now lecturing their colleagues at other plants about the benefits of worker involvement. "NUMMI changed the direction of the American automobile industry," according to industry analyst Maryann Keller.
Despite the success of the joint ventures to date, some believe the conflict between labour and management is inescapable and argue that the Japanese style of management is essentially manipulative and exploitive, For example, Harley Shaiken, formerly an autoworker but now a professor of economics at the University of California at San Diego, observes: "There are two faces to the Japanese system. One is the increased efficiency, better quality, consulting with workers. But the other is increased pressure, stress, tightly strung manufacturing. The question is which face will prevail" (Globe and Mail, June 13, 1988).
It cannot be denied that the American automobile industry was forced into making some very hard choices. It discovered that poor labour-management relations and a neglect of quality had become a sure recipe for disaster. The irony in all of this is that it turned to its competitors for a bailout. Though some will ascribe the changes in management to a cynical survival-at-any-cost mentality, corporations must be given some credit for learning from past mistakes and being flexible enough to make the adjustments needed to improve labour relations and so produce a superior product.Subscribe