manufacturing operations, looking in particular to beneWt from lower labor costs.
These MNCs have also had to contend with the emergence of manufacturing
companies from newly industrializing economies in South America, Eastern Eur-
ope, and South-East Asia. This has resulted in intense cost-based competition in
mature industrial and consumer product markets. The challenge of meeting low-
cost competition has contributed to an increasing emphasis on labor productivity
in manufacturing. The management of manufacturing operations has been heavily
inXuenced over the last twenty years by the advent of the ‘lean manufacturing’
model of organization, operations, and management, initially associated with the
successful emergence of JapaneseWrms into mature high-volume markets. This
chapter concerns itself primarily with developments in advanced mature econ-
omies but there is evidence that the model is increasingly inXuential in manufac-
turing throughout the world.^2 Thus, the model has been the ‘dominant system’
(Smith and Meiksins 1995 ) of manufacturing in recent times and is the start point
for this chapter.
Along with cost pressures, technological advances, an increasing sophistication
of consumer markets, product diVerentiation, and the proliferation of market
niches have placed an onus on innovation in terms of new product development
and ongoing product and process improvement. These have arisen as particularly
pressing concerns for the future of manufacturing organizations in advanced
economies which require greater levels of innovation and higher value added in
order to remain competitive against lower-cost rivals. These pressures have com-
bined to question the extent to which the lean manufacturing model, with its focus
on volume, standardization, eYciency, and incremental continuous improvement,
can meet the challenges facing manufacturers operating in mature economies.
Recognition of these shifts has prompted an increasingly holistic view of strategy
and organization, with implications for corporate governance, corporate business
unit links, and the nature of work and employment relations. In combination,
these features of the context of contemporary manufacturing have resulted in
a number of key developments in organization that have important implications
for human resource management: an emphasis on skill and creativity throughout
theWrm, the incorporation of learning and improvement into ongoing operational
activities, an emphasis on the creation and application of knowledge for product
and process improvement, and greater inter-organizational and network-level
participation in both operations and innovation.
(^2) See, for example, the overview of developments in the world auto industry in Kochan et al. 1997.
And evidence is not restricted to the motor industry; see the interesting case comparison of LG
Electronics and Samsung in South Korea provided by Kim and Bae 2005. There is also an increasing
body of research that documents the nature of ongoing reforms in HRM in China that is critical to
understanding the future in manufacturing but this lies outside the concerns of the current chapter
(for an overview see Warner 2004 andInternational Journal of Human Resource Management, 15 /4 5
( 2004 )).
406 rick delbridge