Employee Involvement Under Rising Competitive Pressure: Evidence from Two Manufacturing Firms in Japan
Employee Ownership and Employee Involvement at Work: Case Studies
ISBN: 978-1-78714-520-7, eISBN: 978-1-78714-519-1
Publication date: 8 May 2018
Abstract
The purpose of this chapter is to provide fresh evidence and insights on a causal link from product market competition to the nature and scope of employee involvement using a case study of two Japanese manufacturing firms.
The firm’s investment decision on two kinds of innovation activities, discrete innovation and continuous improvement, is likely to be a key driver for the adoption (or lack thereof) of the high-performance work system (HPWS) and employee involvement programs. As product market competitionintensifies (e.g., rising international competition and weakening exclusivesupplier–manufacturer relationships), the firm is likely to shift its innovation strategy from bottom-up continuous improvement activities, which almost always accompany employee involvement, to top-down discrete innovation activities, which downplays employee involvement. Such a shift of the firm’s innovation strategy results in declining employee involvement.
This study will inform policymakers, practitioners of management, and the public about the importance of paying particular attention to the firm’s innovation strategy in understanding the interplay between product market competition and the HPWS and employee involvement.
In spite of the rich body of evidence on the effects of HPWS, there are at least two relatively unexplored yet potentially important questions: (i) The conditions under which the HPWS is best introduced and best sustained; and (ii) in what way the HPWS will need to evolve when external environments change. Our findings fill this important gap in the literature by providing novel evidence and insight on the causal link from product market competition to employee involvement.
Keywords
Acknowledgements
Acknowledgments
We wish to thank Richard Arnott, Lorne Carmichael, Jean-Etienne de Bettignies, Malgorzata Knauff, Hideo Owan, Michael Raith, Michael Waldman, and seminar participants at Colgate University, Hitotsubashi University, University of Queensland, UNSW, University of Tokyo, University of Western Australia, Waseda University, 7th International Industrial Organization Conference, and 2008 Japan Economic Association Conference for valuable comments and discussions, and Tomohiro Ara, Jonathan Lim, and Cheng-Tao Tang for excellent research assistance. Special thanks go to all the interviewees who generously gave up their time to answer our questions.
Citation
Ghosh, A., Kato, T. and Morita, H. (2018), "Employee Involvement Under Rising Competitive Pressure: Evidence from Two Manufacturing Firms in Japan", Berry, D. and Kato, T. (Ed.) Employee Ownership and Employee Involvement at Work: Case Studies (Advances in the Economic Analysis of Participatory & Labor-Managed Firms, Vol. 18), Emerald Publishing Limited, Leeds, pp. 105-119. https://doi.org/10.1108/S0885-333920180000018003
Publisher
:Emerald Publishing Limited
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