Japanese Team-Based Work Systems in North America: Explaining the Diversity

New York Stock Exchange, People and Productivity: A Challenge to Corporate America (New York, NY: New York Stock Exchange Office of Economic Research, 1982).

Hill S. , “Why Quality Circles Failed but Total Quality Management Might Succeed,” British Journal of Industrial Relations (December 1991), pp. 541–566.

Osterman Paul , “How Common is Workplace Transformation and Who Adopts It?” Industrial and Labor Relations Review, 47/2 (January 1994).

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Womack J.P. Jones D.T. Roos D. , The Machine that Changed the World (New York, NY: Macmillan Publishing Company, 1990).

Akoff R. , “Beyond Total Quality Management: Much of TQM Is Neither Total Quality Nor Is It Management,” The Journal for Quality and Participation (1993); Ashkenas R. Schaffer R. , “The Lemmings Who Love Total Quality Management, (Implementation of Total Quality Management Techniques Can Have Major Pitfalls),” The New York Times, May 3, 1992; Milkman R. , Japan's California Factories: Labor Relations and Economic Globalization (Los Angeles, CA: Institute of Industrial Relations, University of California, 1991); Danjin D. Cutcher-Gershenfeld J. , “Here We Go Again: Will TQM go the Way of QWL?” Journal for Quality and Participation (July/August 1992); and European Industrial Relations Review, “Lean Production—More Of The Same or Revolution?” European Industrial Relations Review (August 1992), p. 223; Naj A. Kumar , “Shifting Gears: Some Manufacturers Drop Efforts to Adopt Japanese Techniques,” Wall Street Journal, May 7, 1993, p. 1.

There is, of course, an extensive literature on workplace teams. See, for example, Tjosvold Dean , Team Organization: An Enduring Competitive Advantage (Chichester: John Wiley & Sons, 1991); Katzenback Jon R. Smith Douglas K. , The Wisdom of Teams: Creating the High-Performance Organization (Boston, MA: Harvard Business School Press, 1993); Lawler Edward E. III , High Involvement Management (San Francisco, CA: Jossey-Bass, 1986). Most of this literature has not focused on the cross-cultural transfer of team-based work systems and does not directly address the core issue here, which is the variation across Japanese facilities.

See, for example, Womack James P. , The Machine that Changed the World (New York, NY: Macmillan Publishing Company, 1990).

The two lead authors have conducted research (separately) in over a dozen additional Japanese joint ventures in North America as part of other projects. Additionally, nearly half of the co-authors have direct experience in the implementation or operation of team activities in U.S. workplaces. Finally, the full research team recently traveled to Japan to visit the parent companies and the sister factories of many of our research sites. The lessons learned in this study are informed and further confirmed by these additional experiences.

As noted earlier, a book tentatively titled The Seeds of Change: The Cross-Cultural Diffusion of Work Practices is currently being drafted to capture the lull range of findings from this research.

Note that I/N TEK and I/N KOTE are two distinct factories, with the I/N TEK facility feeding steel to the I/N KOTE operation. They are distinct operations, they both draw on the same team system model, operate under the same collective bargaining language, and share a common higher management structure. Hence, we will refer to them jointly in this paper.

Eight sites were initially approached, but one asked that its involvement be postponed (AAI/Mazda-Ford) for business reasons and later joined the project. Another (National Steel) asked to postpone involvement and we have not returned to request access.

The level of access provided by the research sites was exceptional—far exceeding the usual levels of access to outside visitors in nearly all of the organizations. In some cases access was facilitated by past contacts with key individuals at the sites—either by the course instructors (in the course of prior research projects) or others at MSU for other reasons. For example, the secretary of one of the professors (Annette Bacon) used to work for the personnel director at one of the sites (Hitachi) years ago when that individual worked for General Motors. Also, in all cases, there was a strong interest on the part of the sites in supporting graduate education. Finally, the level of access increased over time, as project members established a measure of trust with site representatives and as U.S. and Japanese officials in the sites became increasingly interested in what we were learning. As a result we have been able to develop extensive case descriptions of work practices and we have extended our learning into a number of unanticipated areas—including the present findings about alternative forms of team-based work systems.

From the outset the students were informed that we would be organizing ourselves as a research team with grades based on contributions to the team effort (rather than papers, exams, and other performance measures). In fact, the students were told that it was anticipated that they would each get a 4.0 grade for the course and that even this grade would understate the amount of work that everyone would be undertaking. Despite warnings of a challenging workload, the course attracted twelve students, four of whom were Ph.D. students (Barrett, Lin, and Belhedi in the field of labor and industrial relations, and Ramanand in the field of Resource Development Urban Studies), four of whom were alumni from the School of Labor and Industrial Relations with professional responsibilities relevant to the course subject matter (Coutchie, Inaba, Mothersell, and Wheaton), and four of whom were masters students with interests in cross-cultural issues and a research orientation (Lee, Bullard, Rabine, and Small). Eight nations were represented among the students—Canada, India, Japan, Laos, South Africa, Taiwan, Tunisia, and the United States. The course was co-taught by a U.S. and Japanese instructor (Cutcher-Gershenfeld and Nitta). It noteworthy that four or the masters students and masters alumni have recently been admitted to the MSU Ph.D. program and one of the Ph.D. students transferred into the program.

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We hope the ideas presented here are useful for managers, union leaders, workers, and scholars seeking to better understand team-based work systems. We caution that our findings be seen as preliminary—subject to further confirmation with additional case study and survey research. Also, our presentation of the findings is somewhat informal. In our writing, we have sought to share the spirit of learning and discovery that is guiding us. Incidentally, our telling of the story reflects a unique writing process where much of this article was written as a large group with one person sitting at a keyboard and the rest observing the screen while we discussed each major point in sequence.

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The term “nemawashi” is often used to capture the process for achieving consensus during decision-making in Japan, but we use the term cautiously since we are aware that this process has many subtle meanings (negative and positive) that vary across companies in Japan and in the United States.

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Note that Tomen bought out Kasle's shares after this article was complete, so Coil Center's classification as a joint venture is historically accurate, but no longer true.

Note that these levels of inventory were not necessarily considered as optimal by the sites. For example, the retired general manager for the Coil Center commented that the Coil Center “did not as a strategy chose to maintain one to two week inventories.” He pointed out, instead, that the Coil Center lacked close enough ties with its customers/vendors to achieve lean production levels. Our research would suggest, however, that their team structure will be a constraint on seeking these close ties and on taking advantage of the opportunity if such close ties were forged.

In making the distinction between on-line and off-line team systems, we draw on the analysis of Saul Rubinstein in a personal conversation with Joel Cutcher-Gershenfeld (1992). On-line teams function as teams all the time in the same way that an on-line computer terminal is always hooked up to a main-frame computer. Off-line teams may meet on a regular basis (weekly, bi-weekly, monthly), but the work is organized around individual jobs rather than a cluster of jobs under the auspices of a team.

In reaching this finding we are echoing Stinchcombe's 1965 analysis of the time of company formation helps explain variation in organizational structure.

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In fact, recent conversations with Greg Bamber from Australia's Queensland University of Technology point to a similar pattern with two waves of Japanese investment in Australia—the first of which featured plants that adopted local work practices and the second of which involved the adaptation of Japanese production methods.

Under this keiretsu system, there is not only common stock ownership and common ties to investment banks, there are also high levels of information sharing and joint engineering activities aimed at mutual prosperity.

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Note that Joanne Woodward [Management and Technology (London: HMSO, 1958): 4–21] linked together assembly and mass production, but we separate the two given the rise of lean production as an alternative mode of assembly production. Also, we distinguish assembly from batch based on typical lengths of production runs for a given product (with batch production involving many shorter runs), but the distinction does blur in the case of lean production where variations in product attributes are run in small lots to be responsive to customer requirements.

Womack J.P. Jones D.T. Roos D. , The Machine that Changed the World (New York, NY: Macmillan Publishing Company, 1990).

It is possible that some of the current tensions in the Saturn operations arise from the prominence given to group autonomy and input in the Saturn structure, which is overlaid on certain lean production concepts such as reduced in-process inventory and just-in-time delivery—an issue revisited in the conclusion to this article.

Walton R. , “Establishing and Maintaining High Commitment Work Systems,” in Kimberly Miles , eds., The Organizational Life Cycle (San Francisco, CA: Jossey-Bass, 1980); Rankin T.D. , New Forms of Work Organization: The Challenge for North American Unions (Toronto: University of Toronto Press, 1990).

New York Stock Exchange, People and Productivity: A Challenge to Corporate America (New York, NY: New York Stock Exchange Office of Economic Research, 1982).

In reaching this finding we are echoing Woodward's findings linking organizational structure to production technology.

Naj A.K. , “Shifting Gears: Some Manufacturers Drop Efforts to Adopt Japanese Techniques,” Wall Street Journal, May 7, 1993, p. A I.

Rubinstein Saul Bennett Michael Kochan Thomas , “The Saturn Partnership: Co-Management and the Reinvention of the Local Union” in Kaufman Bruce Kleiner Morris , eds., Employee Representation: Alternatives and Future Directions, 1993 IRRA Annual Research Volume (Madison, WI: Industrial Relations Research Association, 1993).

Our own field research and benchmarking activities in North America points to a number of General Motors, Ford, Chrysler, and other plants facing the same dilemma.

It is interesting to note that none of our joint venture cases had a fully reciprocal exchange regarding work practices. One party or the other was in the lead in each case.