Globalization:Globalization:

Lean productionLean production

Three industriesThree industries

Textile Textile

foodfood

CarsCars

Do you see any similarities in the way they Do you see any similarities in the way they have been shaped by globalization? have been shaped by globalization?

SimilaritiesSimilarities

Lean productionLean production

RelocationRelocation

Commodity chains (or value chains)Commodity chains (or value chains)

Growth of corporate power and profitabilityGrowth of corporate power and profitability

Loss of social powerLoss of social power

Central similarity Central similarity

Whether in Detroit or Dhaka or Toronto, Whether in Detroit or Dhaka or Toronto, there is a ‘restructuring’ is the samethere is a ‘restructuring’ is the same

In some places, this is a shift from mass In some places, this is a shift from mass production to lean/flexible/JIT productionproduction to lean/flexible/JIT production

In others, manufacturing production is being In others, manufacturing production is being established for the first time in a large established for the first time in a large scale, and it is the ‘flexible’ pattern scale, and it is the ‘flexible’ pattern

The declineThe decline

http://www.youtube.com/watch?http://www.youtube.com/watch?v=oxskbwkHN6U NY Times video requiem v=oxskbwkHN6U NY Times video requiem for detroitfor detroit

http://www.youtube.com/watch?http://www.youtube.com/watch?v=oxskbwkHN6U NY Times video v=oxskbwkHN6U NY Times video

The decline of GM The decline of GM

Why?Why?

““natural decline’natural decline’

‘‘innovations/technology’innovations/technology’

Agent? Agent?

Car industry then and nwowCar industry then and nwow

http://news.bbc.co.uk/2/shared/spl/hi/http://news.bbc.co.uk/2/shared/spl/hi/guides/457000/457029/html/guides/457000/457029/html/http://news.bbc.co.uk/2/shared/spl/hi/http://news.bbc.co.uk/2/shared/spl/hi/guides/457000/457029/html/guides/457000/457029/html/

ComparisonComparison

19551955Global monopoly of 3 Global monopoly of 3 carmakers, GM, Ford and carmakers, GM, Ford and ChryslerChrysler4 of 5 cars were made in 4 of 5 cars were made in the US, with about half by the US, with about half by GMGMIn 1955, Toyota made In 1955, Toyota made 23,000 cars and GM, 4 23,000 cars and GM, 4 millionmillion

http://news.bbc.co.uk/2/sharhttp://news.bbc.co.uk/2/shared/spl/hi/guides/457000/457ed/spl/hi/guides/457000/457029/html/default.stm029/html/default.stm

PresentPresentUS car makers only 43% US car makers only 43% of the US marketof the US marketLayoffsLayoffsLossesLossesToyota is worth 10 times Toyota is worth 10 times GM and Ford in the stock GM and Ford in the stock marketmarket

Toyota’s technology Toyota’s technology

Stockless productionStockless productionFlexibilityFlexibility““JIT eliminated the need for each stage in the production JIT eliminated the need for each stage in the production process to hold buffer stocks, which resulted in huge process to hold buffer stocks, which resulted in huge savings. JIT has other advantages too. It involves the savings. JIT has other advantages too. It involves the workforce much more directly in controlling their own workforce much more directly in controlling their own inventory needs, and it allows a variety of models to be inventory needs, and it allows a variety of models to be produced on the same assembly line simultaneously. produced on the same assembly line simultaneously. Before its introduction, assembly lines had been able to Before its introduction, assembly lines had been able to cope with only one model at a time. To produce another cope with only one model at a time. To produce another model required closure of the line and expensive model required closure of the line and expensive retooling”, The Economist. retooling”, The Economist.

““human” technologyhuman” technology

Tiering, temporary migrant workersTiering, temporary migrant workers

Monopoly employerMonopoly employer

‘‘The institutionalization of fear’The institutionalization of fear’

Wages not related to the cost of living of Wages not related to the cost of living of the worker, but profitability the worker, but profitability

Cartoon from CorpwatchCartoon from Corpwatch

Corpwatch report Corpwatch report

““Toyota’s clout was driven by its Toyota’s clout was driven by its increasing profitability and market share. increasing profitability and market share. In the first quarter of 2008, it passed In the first quarter of 2008, it passed General Motors to become the world’s General Motors to become the world’s largest auto company, selling 2.41 million largest auto company, selling 2.41 million vehicles compared to G.M.’s 2.25 million. vehicles compared to G.M.’s 2.25 million. In the U.S in the first six months of 2008, In the U.S in the first six months of 2008, Toyota sold 300,000 more vehicles than Toyota sold 300,000 more vehicles than G.M” G.M”

Growth of corporate powerGrowth of corporate power

““Even a depression is a place for opportunity if Even a depression is a place for opportunity if you have cash, scale and ambition”, begins the you have cash, scale and ambition”, begins the report. Between 2004 and 2008, total revenues report. Between 2004 and 2008, total revenues of the top 2000 companies have increased from of the top 2000 companies have increased from $19.4 trillion to $32 trillion, an increase of 65%; $19.4 trillion to $32 trillion, an increase of 65%; aggregate profits have increased by 114%, aggregate profits have increased by 114%, assets by 83%, and employment by about 17%. assets by 83%, and employment by about 17%. The aggregate sales of the top three companies, The aggregate sales of the top three companies, Royal Dutch Shell, Exxon Mobil and Wal-Mart Royal Dutch Shell, Exxon Mobil and Wal-Mart exceed the GDP of the entire African continent exceed the GDP of the entire African continent ($1.289 trillion and $1.281 trillion for 2008 ($1.289 trillion and $1.281 trillion for 2008 respectively)respectively)

Corporate power (2)Corporate power (2)

The aggregate sales of the top 50 corporations ($8 The aggregate sales of the top 50 corporations ($8 trillion approximately) is double the GDP of China and 8 trillion approximately) is double the GDP of China and 8 times the GDP of India. Wal-Mart’s revenues equal the times the GDP of India. Wal-Mart’s revenues equal the combined GDP of 73 poorest countries; Vodafone is combined GDP of 73 poorest countries; Vodafone is bigger than Ecuador; Exxon was almost 14 times the bigger than Ecuador; Exxon was almost 14 times the size of Kenya; and so on. size of Kenya; and so on. The combined sales of the Forbes Global 2000 ($29.78 The combined sales of the Forbes Global 2000 ($29.78 trillion)trillion) equal the GDP of the 5 richest countries: US, equal the GDP of the 5 richest countries: US, Japan, China, Germany, and France. Alternatively, it Japan, China, Germany, and France. Alternatively, it equals the GDP of 174 out of 179 countries (i.e. all equals the GDP of 174 out of 179 countries (i.e. all countries in the database minus the richest 5).countries in the database minus the richest 5).

Agency?Agency?

CorporationsCorporations

GovernmentsGovernments

Citizens? You? Citizens? You?

Is Wal-mart good for America?Is Wal-mart good for America?

Watch videoWatch video

http://www.pbs.org/wgbh/pages/frontline/http://www.pbs.org/wgbh/pages/frontline/shows/walmart/view/shows/walmart/view/