MIT Reports to the President 1994-95

MIT Industrial Performance Center

The MIT Industrial Performance Center is dedicated to the study of industries in the U.S. and in other advanced economies. Established in 1992 with the help of a major grant from the Alfred P. Sloan Foundation, the Center brings together the intellectual resources of the Institute in a search for fresh insights into the nature and origins of successful industrial performance, and seeks to develop practical new approaches for strengthening public policies, business strategies, and engineering practices concerning these important issues. With the participation of about 30 faculty and more than 50 students from all five Schools at MIT, the Center today serves as a listening post on industry, monitoring patterns of organizational and technological practice, interpreting them for our industrial partners, and feeding our observations back into the core disciplines and departments of the Institute. During the last four years, IPC-affiliated researchers have conducted research at almost 150 firms and 35 non-firm entities.


The 1994-95 academic year marked several important milestones in the development of the IPC. In April the Sloan Foundation awarded the Center a full renewal of its base grant for another three-year period. Also this spring the research programs of the Center were reorganized and consolidated around three major themes. The first group of Ph.D. theses was completed, with the graduating students taking up faculty appointments at Cornell, Harvard, and Dartmouth. Finally, the Center welcomed its first faculty visitor.

Also during this past year the Center continued to develop its role as a significant contributor to the interdisciplinary intellectual life of the Institute, and the group of faculty that regularly participates in its activities continues to grow. The center continues to sponsor the IPC Faculty Seminar. This seminar has played an effective role in strengthening the sense of community among a diverse group of faculty already working on industrial performance-related research, and has also attracted other faculty with a more general interest in these problems. Currently, thirty faculty from all five of the Institute's Schools are active participants in this series.

In April the Center hosted the second International Conference on the Future of Industry in Advanced Societies. The conference, co-chaired by Professors Richard Lester and Suzanne Berger, attracted 250 leading practitioners and researchers in the field of industrial performance, and was notable for the range and quality of the dialog between industry and government that took place. The 60 presenters at the Conference included 24 MIT faculty, drawn from a wide range of departments and laboratories.

In May the Center co-sponsored an ILP conference on Technology Supply Chains chaired by Professor Charlie Fine which attracted more than 500 industrial participants, the largest such event at MIT in a decade. The conference drew heavily on the results of a multi-year IPC research project on this topic led by Professor Fine, and will contribute significantly to the further development of this research.


In the Spring of 1995 the Center's research program was reorganized around three broad themes: (1) new approaches to organizational integration, (2) the international configuration of production, and (3) technology, skills and wages. Several research projects addressing specific topics under these themes are underway.

Professor Charlie Fine and his students continued their studies of technology supply chains in the automobile and microelectronics industries. Professors Richard Lester and Michael Piore and their students continued their research on alternative conceptual approaches to the organization of design and product development activities. During the past year their primary focus was on product development in the cellular telephone sector. Visiting Professor Maryellen Kelley continued her research on the introduction of programmable automation technologies and the impact of alternative approaches to employee participation on performance in the durable manufacturing goods industries. In related work, Doctoral Fellow Rose Batt studied the influence of self-managed teams as well as off-line problem-solving groups on the performance of a major regional Bell telecoms corporation. Professor Kelley also continued her research on the evolution of supplier relations and contracting practices in the defense industry. Professor Erik Brynjolfsson and his students made significant progress in their research on the productivity impacts of information technology. Professors Suzanne Berger and Ron Dore completed a major project on the nature and extent of convergence of national industrial policies and institutions caused by the globalization of capital markets and the expansion of world trade. As part of a larger investigation of the effects of new technologies on skill requirements and wages, Professor Frank Levy and Professor Richard Murnane began a study of changing occupational structures and skill requirements in a major local financial services institution. Finally, researchers at the Center are assembling a comprehensive database of industrial performance indicators covering the United States and other advanced industrial societies at a detailed industry level.


The Center continues to sponsor an interdisciplinary graduate seminar for doctoral students from around the Institute who are engaged in research on subjects related to industrial performance. In addition, in recent years faculty associated with the IPC have initiated five new graduate courses based substantially on the results of their research at the Center: Information Technology as an Integrating Force in Manufacturing (Prof. Brynjolfsson);Technology, Productivity, and Industrial Competition (Prof. Lester); Managing People and Organizations in a Changing World Economy (Prof. Locke); The Massachusetts Economy and Economic Development (Prof. Levy) and Domestic Politics of Trade and Integration (Prof. Berger, with Professor Peter Hall of Harvard).

The Center has instituted a Doctoral Fellowship program that provides opportunities for highly qualified doctoral students to pursue independent thesis research in fields related to the Center's mission. Candidates are selected on a competitive basis and are drawn from across the Institute. To date, 13 fellowships have been awarded. Altogether, the Center has provided financial support to 17 Ph.D. students and 17 SM students.


The Center continues to play an important role in helping to develop intellectual connections and research collaborations among the Sloan Foundation's national network of Industry Studies, now ten in number. The Center is responsible for the Sloan Human Resources Network, which was created to support research and to encourage communications among those doing human resources-related research with the Industry Studies. During the past year, the Network organized a conference jointly with the National Center for the Workplace on the results of the Industry Studies to date in this area. The HR Network also formed a working group on white collar employment issues. This group organized a conference in July 1994 and the resulting papers will be published by Oxford during the coming year. Finally, the Network also organized the first conference for Ph.D. students affiliated with the Industry Studies. This was held at MIT during the summer of 1994, and a second such conference was held in June of this year.


Professor Suzanne Berger was named to be the first holder of the Raphael Dorman and Helen Starbuck Chair. Professor Berger was also appointed director of the MIT International Science and Technology Initiative, and continues to serve on the German-American Academic Council.

Professor Tom Kochan completed his service as a member of the National Commission on the Future of Worker-Management Relations, and continues as President of the International Industrial Relations Association. In the latter capacity, Professor Kochan organized the 10th World Congress of the IIRA, held in Washington in June 1995 and attended by nearly 1000 people.

Professor Erik Brynjolfsson was named the Douglas Drane Career Development Associate Professor at the Sloan School, and, with his student Loren Hitt, received the Best Overall Paper Award at the 1994 International Conference on Information Systems.

The Center's first faculty visitor, Professor Maryellen Kelly of Carnegie Mellon University, played an active role in the Center's educational and research programs, and also participated in the Lean Aircraft Initiative.

During the past year, three books were published by IPC-affiliated faculty: Remaking the Italian Economy (Professor Richard Locke), Beyond Individualism (Professor Michael Piore), and Employment Relations in a Changing World Economy (edited by Professors Locke, Kochan and Piore).

Among the past year's Ph.D. graduates, Rose Batt has joined the faculty of Cornell University (School of Industrial and Labor Relations), David Hart was appointed to the faculty of the Kennedy School at Harvard (Center for Science and International Affairs), and Matt Slaughter is an Assistant Professor of Economics at Dartmouth College. This year's group of SM graduates included Rohit Sakhuja, who was awarded a Masterworks Prize for the best oral presentation of an SM thesis in the department of Electrical Engineering and Computer Science. Continuing SM student Joe Bambenek received the 1995 Karl Taylor Compton Prize for his outstanding contributions to the life of the Institute. IPC Doctoral Fellow Ann Frost received the Best Doctoral Student Paper award in the Management History division of the Academy of Management.

Richard K. Lester

MIT Reports to the President 1994-95