"The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations: A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia"

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.

"Automobiles: Strategy-based Lean Production System"

The present situations and future prospects of the Japanese automobile industry are discussed. Selected topics in this paper include the following: analyses of the basic product-industry characteristics of the automobile (e.g., product architecture); the mature of the dynamic competition in the world auto industry; competitive performance (e.g., productivity) of the Japanese auto makers; organizational capabilities of better Japanese firms in production, development and procurement; overall environments in the 1990s; the concept of "balanced lean" system and its adaptation to environmental changes; new flexible production systems that cope with volume fluctuation; architectural strategies of the auto firms; modularization of parts; M&A and alliance; future of the automobile technologies and architectures; future of the capability-building competition.

Modularization in the Auto Industry: Interlinked Multiple Hierarchies of Product, Production, and Supplier Systems

This paper analyzes the modularization in the world auto industry. The modularization in the industry has involved architectural changes in product, production, and supplier systems with each region (Japan, Europe and the U.S.A.) emphasizing different purposes and aspects. As an attempt to understand such multi-faceted, complex processes coherently, this paper proposes a conceptual framework that sees development / production activities as interlinked, multiple hierarchies of products, processes, and inter-firm boundaries. With this framework, drawing on case studies and questionnaire survey data, the paper examines the on-going processes of modularization in the industry. It is argued that tensions exist among the three hierarchies, and such tensions may lead to further changes in product, production and supplier-system architectures in the auto industry, in a dynamic and path-dependent manner.Automotive industry, modularization, product architecture, production system, supplier system, hierarchies

Index theorem for topological heterostructure systems

We apply the Niemi-Semenoff index theorem to an s-wave superconductor junction system attached with a magnetic insulator on the surface of a three-dimensional topological insulator. We find that the total number of the Majorana zero energy bound states is governed not only by the gapless helical mode but also by the massive modes localized at the junction interface. The result implies that the topological protection for Majorana zero modes in class D heterostructure junctions may be broken down under a particular but realistic condition.Comment: 8 pages, 3 figure

"The Advance to Car Production and Globalization of the Chinese Munitions Enterprises"

This paper undertakes a practical analysis on the Chinese munitions enterprises' advance to the car production, their formation of the development strategies and the globalization process with foreign-ventured enterprises in order to formulate their mass production system. Along with the end of the cold war, the Chinese munitions enterprises began to transfer to the production of civilian goods. Automobile industry became the primary participation circle to each munitions enterprise. The most successful cases are Chang'an Automobile (Group) Liability Co., Ltd.(Chang'an Auto) to which Armament Industry Corporation(Armament Co.) affiliates, Changhe Aircraft Industry Co. and Harbin Aviation & Automobile Manufacture Corporation Ltd. to which Aviation Industry General Corporation affiliate. Their auto production were ranked the top forth, seventh and ninth in 1999. The background conditions and organization structure of munitions enterprises are quite different with civilian enterprises in their advance to car production. Different with civilian enterprises, the car production of successful munitions enterprises almost started from zero and rapidly increased within short duration. Their development are close related with the development strategy to China of the global enterprises in the Chinese automobile market. This paper will analyze on the development history of the munitions enterprises and their globalization development based on the actual conditions. From the historical view, the development of the Chinese munitions enterprises were affected by the relationship changes with Japan, the former Soviet and America, especially by the China-Japan War. Therefore the production bases of the Chinese munitions industry in the inner areas were set up during China-Japan War and were more enforced during the cold war between America and Soviet. The factories groups which were established in these production bases and produced military goods or machinery goods became the primary enterprises which shifted to the automobile production. The successful munitions enterprises possess rather better management resources and location conditions. Especially, many years' technological know-how of its machinery production, trial production of jeep, experience of small quantity production and the industrial foundation of Chongqing as the location of Chang'an Auto are important conditions which led to its success later. The strategies of "giving up big road, undertaking two-side roads" especially "Mainly Targeting Minis" formulated by Armament Corporation and Aviation Corporation in their initial development period of vehicle production played an important role in rapid increasing of Mini vehicle makers such as Chang'an Auto and the advance to compact car production. After the technological introduction of compact car production, Armament Corporation adopted serial strategies, such as the enforcement of its coordination with foreign makers speedily, structure reorganization and listed stock and mainly increased the car production capacity of Chang'an Auto. From now on, along with WTO participation and motorization, munitions enterprises' coordination with global enterprises such as Suzuki, Mitsubishi, Fuji Heavy Industry, GM and Daimler-Chrysler. will be more enforced and will plan more important role in compact car(around 1L) market.

Automobiles:Strategy-based Lean Production System

The present situations and future prospects of the Japanese automobile industry are discussed. Selected topics in this paper include the following: analyses of the basic product-industry characteristics of the automobile (e.g., product architecture); the mature of the dynamic competition in the world auto industry; competitive performance (e.g., productivity) of the Japanese auto makers; organizational capabilities of better Japanese firms in production, development and procurement; overall environments in the 1990s; the concept of ?balanced lean? system and its adaptation to environmental changes; new flexible production systems that cope with volume fluctuation; architectural strategies of the auto firms; modularization of parts; M&A and alliance; future of the automobile technologies and architectures; future of the capability-building competition

Product Development in the World Auto Industry

macroeconomics, auto industry, management efficiency, productivity

Organizational Capabilities of Product Development: International Competitiveness of Japanese Automakers (Japanese)

This paper reports the results of an international comparison of productivity in automotive product development in Japan, the U.S. and Europe. This comparative survey was commenced by Harvard University in 1985. The first survey analyzed data from the 1980s, and detailed results showing the superiority of Japanese manufacturers were published by Fujimoto and Clark (1993). Subsequently data for the 1990s was collected twice, in 1995 and 2000. This paper analyzes the data from the entire 20 year period and reports on key points. The conclusions show that Japan's superior development productivity noted in the 1980s - measured by person-hours and development lead-time - continued until 2000. European and U.S. automakers had difficulty imitating Japanese firms' integrated organizational abilities. One fundamental problem is that the typical project member in Europe and the U.S. is highly specialized, with a narrow range of responsibilities. Since this problem arises from labor market systems, individual firms can do little to change it. This high degree of specialization means larger numbers of people involved in each project, making coordination complicated. Since project managers in Europe and the U.S. are also highly specialized, it is difficult for them to take responsibility for both product development and marketing (product concept) in the way that Japan's heavyweight project managers do.

"The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations: A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia" (in Japanese)

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.