7 Managing resources operations management Learning objectives understand

7. Managing resources: operations management

Learning objectives • understand the origin of the main production models • explain the main differences between different operations systems • critically assess the advantages and disadvantages of these models • reflect on the societal effect of production systems and production management • link human resource management and corporate governance to modes of production • understand the concept of fit in the context of production models and operations management • assess the possibilities of applying different production models within divergent societal contexts

Chapter Outline (1) 7. 1 Introduction 7. 2 Characteristics and types of production system Taylorism, or scientific management (1890– 1911) Fordism, or mass production Flexible production Lean production 7. 3 Operations systems and the societal environment Mass standardized societal systems of production Societal systems of flexible production The societal system of lean production The German societal system of diversified quality production Short-termism and institutional inertia: The difficult transition in the USA

Chapter Outline (2) 7. 4 Comparative work organization characteristics 7. 5 Conclusions Study questions Further reading Case: Manufacturing machine tools in Germany and France Notes References

Figure 7. 1 Categorization of work systems Adapted from Sorge (1995)

Table 7. 1 Lean and mass production systems compared

Table 7. 2 A typology of societal systems of production

Table 7. 3 Models of flexible production organization

Table 7. 4 National differences in forms of work organization

Study questions 1. 2. 3. 4. 5. 6. 7. 8. 9. Which societal features could help to explain why Taylorism and Fordism developed in the USA? Why do you think Toyotism, or lean production, developed in Japan long before flexible production was recognized in the West? Explain how lean supply chain management fits the societal features of Japan and of Germany. Explain the links between human resource management systems and corporate governance modes to mass production, and to the lean and flexible modes of production. Explain why lean production could be more difficult to implement in the USA. Explain the main differences between mass and flexible production systems, and link these differences in features to the differences in the societal institutions that are needed to develop these models. Explain which type of operations systems we would have to expect in China, a country which combined state domination with new capitalism and has become a major international competitor in final consumption goods, mass markets and notably consumer electronics. Australia is a leading exporter of uranium, coal and other ‘extracted’ commodities. Russia is also a major exporter of extracted commodities (notably gas and oil). In some ways they will therefore have comparable operations. But what about the expected design of operations systems in comparison? Explain whether, in your opinion, convergence can occur in the areas of production systems and production management. Consider the role of the international division of labour as you do, i. e. the tendency for societies to specialize in industries and market segments.