Fordism and Post-Fordism

It has been argued that the way in which work is structured and organised has changed over the last several decades. Hence, the type of labour process and mode of economic growth varied in accordance with this argument. As some sociologists and economists observe, the so-called Fordist way of organising work, whose principles tend to apply most extensively to conditions such as mass production and mass consumptions, has declined its effectiveness in terms of economic growth.

The characteristics of modern industrial society and organizations, according to some neo-Fordists view, are shifting towards to a new pattern that is clearly differentiated from the classic Fordist industrial structure: the post-Fordism. The term post-Fordism can be defined as: “A pattern of industrial organisation and employment policy in which skilled and trusted labour is used continuously to develop and customise products for small markets” (Watson, 1995, 343).

Under this assumption, a irreversible tendency of market fragmentation emerges in the major capitalist economy; the consequences of this have been: flexible production process based on flexible machines or systems has replaced mass production process based on assembly-line techniques; the use of a large number of semi-skilled or deskilled workers has been replaced by a combination of multi-skilled and unskilled workers during the labour process.

In fact, the concept of post-Fordism has already gone beyond the manufacturing field that is previously dominated by Fordism, to an even comprehensive field, which includes the tertiary employment sector: the many types of services production, such as education, retailing or hospitals. In this sense, the post-Fordism is likely to shape the dynamics of the capitalist economic system to a broader scope than the Fordist style of organisation and work could do. However, many commentators (e. g.

Kumar), argue that economies based on mass production are still common, while flexible firms, industries and economic systems are relatively few; manufacturing as a important means of sustaining a capacity to innovate and develop high-tech skills in an economy can not be replaced or overridden by service industry or any other industrial sectors. Therefore, the debate about post-Fordism and post-industrial society is continuing, but it reflects the possibilities of new technological revolution of qualitative development for contemporary capitalist economy.

Most post-Fordists argue the Fordist-way of organising work has been encountering more and more resistances from workers; the principles of mass production and standardized products are increasingly challenged by flexibility and customised products form of production, so a new model of industrial system emerged! And ‘flexible specialization’ has been regarded as the heart of this new system: the post-Fordist analysis of economy.

This determines that: the production would be based on ‘flexible’ basis, in order to suit the shifting and differentiated markets that containing a diversity of consumer groups, each of who pursues different products; ‘reinvestment in more flexible production equipment and techniques and new sets of products’ (Jessop, 1988, 22), more general purposes machines are replacing special purposes ones, as a correspondence of increasing demand for differentiated goods and services; increasing productivity by implementing both ‘functional flexibility’ and ‘numerical flexibility’, i. . through employing a core part of work force, which is made up of highly-skilled or qualified, adaptable workers, to perform the ‘functional flexibility’, switching them between jobs and work tasks as necessary, and combined with a periphery part of work force, which mainly comprises of deskilled or semi-skilled workers, to perform the ‘numerical flexibility’, adjusting their number to the changing volume of work .

The former has relatively higher job security and job satisfaction, whereas the latter is likely to be under casually employed status; the former have stronger ‘bargaining’ power with their employers because they are ‘knowledgeable’ and not ‘dispensable’, they are better able to make negotiations with employers regarding salaries or working conditions, but the latter remains relative ‘weak’ positions and less powerful; the former has strong incentives to put commitment to jobs as in return, they get income rises, this makes them even enthusiastic and eventually put more commitment to their work.

This is vital in improving quality and performance for individual products! The post-Fordist mode of economic regulation involves such an emphasis on quality competing. Quality-competitive production is the new predominant form of competition under post-Fordism; competition creates pressures to firms and encourages a market-led ‘increasing profit’ based on continuous innovation of technological process and products.

In a word, ‘versatile labour and universal equipment can reduce the cost of customisation through economies of scope, extending the market for differentiated goods and facilitating new investments in flexible technologies, which narrow the price premium for customized products, extend the market and so on’ (Paul Hirst and Fonathan Zeitlin, 199? , 3). Meanwhile, the organization itself has been updating under the post-Fordism assumption, in terms of structures and patterns.

Decentralisation’ is a typical structure of post-Fordist industrial organization, this is especially the case where large corporations splitting up into two categories: one is the developed ‘decentralised’ small business or production units, the other remains ‘centralisation’ in certain parts of the business. According to Peters and Waterman (1982), this is ‘simultaneous loose-tight controls’, with a tendency to ‘chunk’ the big organization into ‘small is beautiful’ units (Watson, 1995, 350).

Firms disintegrating vertically and horizontally mainly represent this. ‘Decentralised’ units co-ordinate and co-operate with each other, and form ‘networks’ where they focus on or specialise small tasks, at the same time, they subcontract to one another and share some common services that are out of the individual units or firms’ capacity to provide for themselves, examples of this include training, price-control, market forecast and research. In another word, they co-operate through a ‘collective responsible system’ to achieve their common interests.

The remaining part of the ‘centralised’ units in large corporations would be used to deal with relatively ‘big’ production tasks, which ‘small’ units feel hard to cope with. Successful industrial organisation would be deeply benefited by, as Brusco says, the ‘productive decentralization and social integration’ (Brusco, 1982). Another aspect of the post-Fordist analysis has been dominated by the changing industrial structure: deindustrialization.

This term, according to Tony Watson, is understood ‘when figures are produced in western industrialised societies to show falling numbers of people employed in organisations identified with manufacturing’ (Watson, 1995, 361). Over the last twenty years, a proportion of people have entered the ‘service industrial employment’ as we can see greater numbers of people are working for shops, restaurants, banks, and insurance. Some post-Fordists argue this proportion has been increasing, whereas the number of workers employed by the manufacturing industry is diminishing, sharing a proportion that is much less than twenty years ago.

This is analysed by ‘Labour Market Trends September 1998’: the proportion of people in service industries is 75%, while the figure of total production and construction industries is only 23%. In the last several decades, many large corporations, especially transnational companies, have shifted their strategies. They see the systems of flexibility as a way to reorganize the production, and begin to move towards that direction. Japanese, Italian and German firms have achieved the rapidest progress. This is typically represented in the car industry, where flexible strategies such as ‘just in time’ are very frequently used.

But American firms have been historically the slowest in pursuing flexible strategies, as most American firms had been receiving profits under the ‘old fashion’, the mass production, for quite a long period, and are not so much motivated by the new method. But recently, they are moving faster as they realised arising profits under flexible production. Another example is where the Information Technology intensively used in the production process, as an important means of flexible control throughout entire business, such as designating, producing, delivery and after-sell services.

Sometimes, Information Technology replaces workers in certain part of the process, making a distinctive feature of the contemporary economic society. Post-Fordists attribute the emergence of ‘flexible method’ largely to the disadvantages of ‘mass production’ system. They pointed out the ‘golden period’ for ‘mass production and mass consumption’ has gone, given the characteristic of more and more fragmented market and differentiated demand in the economy; ‘Mass production’ can’t generate an attractive amount of profits to the firms and exploit the resources and labour force to ‘perfect’ extent.

For example, mass production under new economy system inevitably lead to goods overproduced, the surplus goods require stock space and administration, which cost firms extra money and reduce firms profit; by substituting some ‘human’ workforce to ‘machine’ ones, IT skills help the production system running more efficient and accurate. It would further reduce the ‘bargaining’ power of deskilled workers, as these are the group most likely to be substituted. Despite those arguments, many other theorists provide different views.

Kumar comments: ‘flexible specialisation and flexible firms are not very common’ while ‘mass production has not declined in global perspective’ (Kumar, 1997, 56-59). Some arguments say this is because the method of ‘flexibility’ is theoretical and lack of practicability. For instance, the installation of IT throughout the production process is complicate and extremely expensive. Not quite a lot firms have the ability to practice, few could be able to afford such a costly technology.

Mass production remains a common phenomenon in modern economic society. Japan is a country whose economy based on mass production. A typical example is the Japanese car industry, from where we see the existing mass production of all kinds. However, what makes it distinctive is this industry’s production process has combined with flexible specialization, e. g. just in time method. It implies that the existence of flexible specialization does not necessarily mean the extinction of mass production.

Another important argument relates to the term post-Fordism is associated with ‘deindustrialization’. Explanations for this phenomenon hold by the post-Fordists are pluralistic. Some argue that the declining demand of manufacture products is the major cause. The most typical case is Britain, who once called ‘the workshop’ of the world. Its famous industries such as shipbuilding and steel manufacturing have contracted outlets considerably. In order to maintain profit, they have to reduce the labour force in those areas by a large amount.

Another explanation has been the ‘replacement of the human workforce by machines’. This is represented in the production process highly automated industries, such as car or TV industries. It’s also been argued that the lower wages of labour force in the Third World countries is a factor which influence this issue, as the manufacturing industry tends to be labour-intensive, wages cost is a large proportion of the total cost, so moving the production process to these countries would have an apparent effect on reducing costs.

But, as mentioned before, they all agree that, a growth in employment in the service industry has partially compensated the job losses in the manufacture industry. Nevertheless, some theorists argue that ‘service requirements will often be met by increased production by manufacturing industry’ (Gershuny, 1978). Examples include: the increased demand of laundries would push up the demand of washing machines by laundries, hence putting demand on the manufacturing sector.

The same principle applies other employment sector, like Internet cafe and Computer Company or cinemas and film industry. ‘Family Expenditure Survey’ (1978) shows a shift in household expenditure on transport: the purchase and maintenance of vehicles comparing with bus fares, has a larger and increasing percentage of total household expenditure from year 1953 to 1991, implies consumers buying goods rather than services.

The effect of ‘deindustrialization’ and an increasing number of people involved in the ‘service’ sector would be, as Daniel Bell argues, ‘generally improve the quality of life and work’ as he anticipates that ‘unpleasant, dirty and routine jobs in factories would be eliminated as greater proportion of workers would be dealing with people, doing more rewarding work and in better surroundings’ (Abercrombie and Warde, 1988, 85). However, the reality seems to be somewhat different.

Some service occupations bring people satisfaction less than expected. Such as clerical jobs or telephone operators, create numerous boredom that is second to none, cleaners’ job is never more attractive than working in a factory. In conclusion, many comment argue that post-Fordism theory have developed on the basis of Fordism. Given the inherent nature of capitalist economy, they evaluate the capitalist economy as a constantly evolving one. Fordist style economy is perhaps outmoded nowadays, but post-Fordism isn’t likely to be the ultimate.

Generally speaking, post-Fordism has generated sufficient evidences to prove its existence and rationality in a wide range of context. However, it undergoes criticism and scrutinise. The debates about post-Fordism mainly focus on ‘flexible’ principle and ‘deindustrialization’ perspective. Post-Fordism as a new method of organising work and production is still evolving, extending its theories and principles to a more comprehensive social and economic sphere.