Exploring the Socio-Technical Impacts of Lean Production

As published in the Spring 2002 issue of Impact, Emerging Work from the Center for Technology, Policy, and Industrial Development.

How did you become interested in the study of work?
Working summers in a paper mill near my home in Maine, I got interested in the intricate social system that was critical to how the mill operated.

While at Harvard as a freshman, I took a course with Professor David Riesman that encouraged students to gather first-hand data. I was delivering papers in Harvard Yard and had gotten friendly with the maintenance and cleaning staff at the various buildings. I decided to write a paper about the meaning of work in the lives of these people, whose situation in life contrasted so greatly with that of the students occupying the dorms. This was my first fieldwork experience and I loved it.

How did you put that interest to work?
My first real job after college pursued my interests in community organization. I worked as the head of outreach programs for the Coastal Economic Development in Bath, Maine. I found myself eventually more intrigued by the dynamics of managing people than by the policy issues.

This experience solidified my resolve to return to the study of work. I moved back to the Cambridge area. My first job at Harvard Business School, working with Professors Robert Hayes, William Abernathy, and Kim Clark, was working on a study of manufacturing productivity. The specific focus was to understand why wide differentials in performance existed at plants within the same company. From our interviews, we learned how much management policies at a given plant affected its performance, both on the technical side and on the social system side.

This experience introduced me to the complexities of performance measurement and solidified my belief that a socio-technical perspective was needed to understand the dynamics of learning and change in a production setting.

How did you get involved with IMVP?
As a graduate student at Sloan, I worked as an RA for a visiting professor, Haruo Shimada from Keio University. He was beginning a study of the Japanese automotive assembly plants being opened in the U.S. to understand how well they were able to transfer the Japanese human resource system and production approach. As a result, I was one of the first American researchers allowed to visit and conduct interviews at the new transplants of Honda, Nissan, Mazda, and the GM-Toyota joint venture NUMMI (New United Motor Manufacturing Inc.) I found the topic to be endlessly fascinating and that's how I the first came in contact with IMVP.

Under the leadership of John Krafcik, a Sloan MBA student who had worked as a quality engineer for NUMMI, IMVP had begun an international benchmarking study of assembly plants, beginning with comparisons between traditional Big Three plants and the new Japanese transplants. John developed a sophisticated new methodology for measuring assembly plant productivity. When I joined IMVP, John had already released the startling first results from this research, showing that NUMMI, within its first year of operation, had achieved productivity at least 50 percent higher than that of a technologically similar GM plant and achieved the best quality within GM's entire US operation. All this with an old plant, which had been closed, with the former workforce and union officials, and without any fancy new technology. These findings spotlighted the most important change that Toyota made at NUMMI -- the introduction of its now-famous Toyota Production System, which IMVP came to identify more generally as lean production.

John and I joined forces to study what explained these performance differentials. I focused primarily on the organizational and human resource policies making up the social system. We eventually gathered data from 70 assembly plants worldwide through onsite visits, interviews, and often provided comparative feedback to the plants. These became hallmarks of the International Assembly Plant Study. The Round 1 results from our joint work provided the basis for Chapter 4 in the IMVP book The Machine That Changed the World and also provided the underpinning for my Ph.D. After I took my job at Wharton in 1990, I continued the assembly plant research, with Frits Pil who now teaches at the University of Pittsburgh. We are just beginning to release the results of Round 3.

What are the threads of your current research?
I continue to study the organizational logic of lean production vs. mass production from a socio-technical perspective. Lean production reduces inventory levels and other buffers, increasing interdependence in the production process and highlighting production problems. Dealing effectively with these problems requires motivated, skilled, and adaptable workers. I have argued that innovative HR practices and work systems can contribute to effective collaborative problem-solving processes -- and thereby support simultaneous improvements in productivity and quality.

As lean production diffuses to many different settings, I try to understand what helps this collaborative problem-solving get established, and what are the obstacles. Along with IMVP colleague Susan Helper, I've also studied collaborative problem-solving between firms -- specifically between automakers and their suppliers as they try to implement lean production.

I'm also deeply interested in the impacts of lean production on individual managers, engineers, and auto workers and I co-edited a book with the Sloan School's Thomas Kochan on country-level analyses of lean production on employment.

My most recent work examines the applicability of a build-to-order business model to the auto industry, as a possible post-lean production paradigm. Along with IMVP colleagues, I'm exploring how build-to-order may be facilitated by e-business initiatives (both B2B and B2C) and by experiments with modular design and production involving automakers and first-tier suppliers worldwide.

Which IMVP strengths are you drawing on for Phase IV, NextAuto?
For twenty years, IMVP has been the largest and most influential international automotive industry research consortium. IMVP's early research changed the automotive industry by providing the keys to lean production to industry worldwide. Today the global auto industry is facing critical decisions about its future. Challenges include tightening profit margins and rising customer demands. Global operations and technological options from telematics to green drive trains call for new value propositions. Competitive dynamics and the ground rules for collaboration are changing as automakers consolidate and form alliances and as new mega-suppliers emerge. To make the strategic decisions that will drive a new paradigm for success, each company needs industry-wide knowledge and insight. And that's where we can help.

What's your vision of a healthy auto industry for the 21st century?
In recent years, automotive was portrayed as the quintessential Old Economy industry unable to respond quickly to the promise of the New Economy. Yet the next step for this industry will result from combining Old with New -- for example, by combining deep knowledge about core processes with new Internet-based tools and by combining pull production with pull distribution. This isn't the only strategic challenge ahead, however. Auto's next economy will bring incredibly complex social and technological forces to bear. Automakers and suppliers who can preserve strong capabilities in the basics and enduring collaborative relationships while fostering innovations in business models, services wrapped around products, and solutions for overburdened consumers will flourish - others will not. We believe IMVP's 20 years of research experience, proven track record of strategic insight, and international network of researchers equip us well to guide the industry towards success in auto's next economy. We'd like to be partners in that effort.

MacDuffie In Profile

"I grew up in Maine in a paper mill town and my first exposure to an industrial setting was working summers at the mill in high school," said John Paul MacDuffie, co-director of CTPID's International Motor Vehicle Program and Associate Professor of Management at University of Pennsylvania's Wharton School. "It fascinated me. I drove a clamp truck delivering rolls of paper from one stage of the process to the next. In addition to the dominating production technology, I found an intricate social system critical to how the mill operated. Since I covered the whole plant, I had ample chance to observe relationships between supervisors and workers, among workers on the same paper machine, and between management and labor broadly. All these relationships were heavily influenced by history and custom and the actions of individual leaders, both official and unofficial."

This early fascination with work became an academic interest as he studied sociology at Harvard University and earned a AB magna cum laude in 1977. MacDuffie began his PhD work at the Sloan School in 1985 after testing his research interests in several Harvard Business School projects. He received a PhD in Industrial Relations/Organization Studies in 1991 shortly after he began teaching at Wharton. "I've taught a course of Managing People at Work in the MBA core for the past 11 years and I've been course head since 1995. I bring my research into the classroom whenever I can and this gives me a lot of credibility with the students."

Involved with IMVP since his Sloan days, MacDuffie now co-directs the program with CTPID Director Fred Moavenzadeh. MacDuffie has published more than 40 articles on his IMVP research and CO-edited After Lean Production: Evolving Employment Practices in the World Auto Industry. He is an expert on the economic implications of lean production systems, strategies and mechanisms of knowledge transfer, and high performance work systems.

As an extension of his IMVP work, he CO-directs Wharton's Reginald H. Jones Center for Management Policy, Strategy, and Organization. He lives in Philadelphia with his wife, Jane, a psychotherapist, and two children, Kate, 15, and Peter, 12. And, after years of auto industry research, he usually walks to work.

top