Fordism


            The Fordist paradigm flourished in the context of particular market, technological, organizational and employment characteristics (Sabel 1982; Piore and Sabel 1984; Wood 1989). In order to sustain mass production, companies bestowed large investments in dedicated plant and equipment. In order for the mass produced goods to be profitable, the markets for mass produced products had to be both large and have a stable pattern of demand which allowed them to absorb high volumes of standardized products over time. The large-scale organization, utilizing Fordist methods of work design and managed through an adversarial industrial relations system, was the dominant organizational form. Technology was used as a means to enable the management to closely control the organization Information and Communications Technologies (ICTs) were used as a means to extend the management’s control to up till then unreachable areas of organizational activity and over organizational members who, in the past had exercised skill and enjoyed a degree of autonomy in the execution of their work tasks.


 


The Fall of the Fordist Approach


            Theorists such as Piore and Sabel (1984); Lash and Urry (1987) and Hall and Jaques (1989); and Harvey (1989), believed that Fordist approach to production and consumption started to crumble in the 1970s. It has been argued that as large organizations competed, the demand mass produced consumer goods declined. The home market failed to absorb further increases in output. As a solution to this problem, organizations explored markets outside their homeland. Organizations from industrialized countries sought markets in both developed and developing countries. However, these efforts to engage in global competition failed to restore productive efficiency. During those times, small and medium sized organizations gained prominence. These organizations did not follow the Fordist approached. Rather they took advantage of the flexible capabilities and characteristics of ICTs to cut cost of producing customized – as opposed to mass market – goods and services.


            A new phenomenon occurred. Organizations started to respond to a new set of new global product and technological conditions. Product markets increasingly became unstable, pushing organizations to seek new technological opportunities to generate product and process innovations which will meet the new fragmented pattern of demand. he organisational forms associated with the pursuit of this objective are typically small-scale producers linked to each other and to larger producers who they supply in tightly knit industrial networks. Such networks embody what has been termed the principle of ‘flexible specialization’.


 


            Flexible Specialization is defined as a strategy of permanent innovation: accommodation to ceaseless change, rather than an effort to control it. This strategy is based on flexible equipment; skilled workers; and the creation, through politics, of an industrial community that restricts the forms of competition to those favoring innovation (Piore and Sabel 1984 cited in Mcloughlin 1999).


As large organizations started to be confronted with the changes in technology and demands, they began to exploit new technological innovations following the lead of small and medium sized organizations. As a result, similar organizational forms to those of their smaller counterparts have been adopted. Increasingly, large ‘Fordist Bureaucracies’ are being transformed through downsizing and deleyaring of managerial structures; the re-skilling of workers through team-based systems which increase autonomy and empowerment; the ‘democratization’ of work through involvement and participation; and the development of networked forms of intra-and inter-organizational relationships. The outcome is a new Post-Fordist model of organization based, not on the principle of control, but rather that of ‘flexibility’. Clegg (1989), compared the characteristics of Fordist and Post-Fordist organizations:



  • Fordist organizations were rigid while Post-Fordist flexible

  • Fordist organizations were premised on technological determinism while Post-Fordist on the technological choices made possible through ‘de-dedicated’ microelectronic equipment

  • Fordist organiztaions have jobs that were highly differentiated, demarcated and de-skilled while Post-Fordist ones have jobs that are highly de-differentiated, de-demarcated and multi-skilled (cited in Mcloughlin 1999 p. 54)


 


 


 


Post Fordism


            The phenomenon labeled either post-industrial or post-Fordist can be divided into three groups. The first comprises technological advances and changes in economic structure – these include the shift from manufacturing to services, the emergence of a global economy and the information technology/hyper-automation in industry. The second embraces wider social and cultural shifts; these include the intensification of consumers, the ambiguous rise of so-called post materialism and the replacement of class-determined life chances by individualized lifestyles as the primary source of social identity. The third group includes intermediate phenomena, such as changes in the structure of organizations and the pattern of employment, which link work, or the economy, and life or society (Jucapec and Garrick 2000).


 


From Mass Production to Mass Customization


            The Fordist era was characterized by mass production of goods and services. The mass production model of the industrial economy according to Davis (1996) held that an organization can achieve either low-cost, standardized goods or services or high-quality, customized ones, but not both simultaneously (p. 15).


 


            In the Post-Fordist era, mass customization became popular. Unlike mass production that focused on mass producing goods and services but failed to give emphasis on quality, mass customization has demonstrated that an organization can simultaneously mass produce, distribute, and deliver customized goods and services. According to Duray (2002) the practice of mass customization does not fit the mindset associated with conventional production and manufacturing methods. Historically, companies chose to produce either customized, crafted products or mass produced, standardized products. This traditional practice means that customized products are made using low volume production processes that cope well with a high variety of products. Similarly, mass production process is chosen for making standardized products in a high volume, low cost environment. Davis (1987) defines mass customization as a one-of-a-kind product manufactured on a large scale. Customers are able to purchase a customized product for the cost of a mass produced item. Mass customization combines customization and mass production offering unique products in a mass produced, low cost, high volume production environment.


 


            Mass customization according to Pine (1993) is the mass production of individually customized goods and services. Mass production systems declined in usage and popularity because it failed to satisfy both the manufacturer and the consumers in the light of the changing demands and intense competition. Mass customization systems may achieve both manufacturer and consumer satisfaction, providing a low-cost customized product. In order for a mass customization system to succeed it is important that advanced technology is applied such as the flexible manufacturing system, computer- integrated manufacturing, computer-aided design, and advanced computer technology. Using these technologies in the practice of mass customization will shorten product-life and development cycles as well as allowing manufacturers to respond more quickly and flexibly to changing consumptive drives. Finally, consumers will have access to a variety of relatively low cost, high-quality, customized products while manufacturers can reduce excess inventory and markdowns.


 


The Apparel Industry in the Post-Fordist Era


            Labor-intensive apparel industries require workers for every process. Traditionally, apparel manufacturers have used the bundle system, a method of passing the pieces of the partially finished garments form one set of laborers to the next, restricted by rigid hierarchical divisions. However, rapid dynamics of consumer desires in the fashion market coupled with the global competitiveness of low-wage-rate countries has diminished the effectiveness of this system. By focusing on producing the maximum number of units in a given period of time, the bundle system has caused problems that include excess inventory, a long lead time, and low quality (Black and Chen 1995). Thus, apparel manufacturers have started to try Just-in-Time (JIT), Quick Response (QR) and other concepts in marketing and production that aim to eliminate excess inventory, long lead time, and low quality in traditional marketing systems such as mass production (Black and Chen 1995).


            Organizations today aim to balance quantity and quality. Organizations are looking for different strategies to produce high quality goods and services in a timely and efficient manner. Mass customization, together with other manufacturing strategies are being employed by organizations around the world in order to reach more markets and to ensure that their products are of superior quality.


            In the previous decades, several manufacturing and production strategies and techniques have emerged. In this section, some of these techniques will be discussed.


 


1. Just-in-Time (JIT)


            JIT can be considered as a philosophy for waste reduction and continuous improvement, a method which to control and reduce inventory, a way of increasing throughput, and a production scheduling system (Lowson 2002).


In manufacturing, JIT is essentially a management philosophy where the primary objective is to achieve zero or minimum levels of inventory. The advantages of JIT include elimination of waste, enhanced product quality, improved employee morale and increased customer satisfaction (Reddy, 1994).


            JIT is a shop floor-control tool that allows the scheduling of inventory movement through the shop floor with the use of a Kanban, a materials movement tracking device. The Kanban can take the form of a card, a box, or a marked off area on the floor. These Kanbans are used as an authorization to move materials or to produce new product. JIT also focuses on the basic principle of receiving production parts as neede, rather than building up inventories of these components. Using the JIT production planning approach, managers reduce inventory to a minimum level, keeping on hand only the amount needed in production until the next order arrives. One of the most important aspects of the JIT process is cooperation. Just-in-Time thrives on open, honest communication and trust among all people involved in the process. Employees must work together to improve the product and the process and they must he given incentives to do so. Management must be open minded and willing to help in the change. Just-in-time is a philosophy that stresses training, cooperation and preparedness to eliminate waste. When undertaking this philosophy, companies need to look internally to improve themselves (Epps, 1995).


 


            Quality is the most important part of any product. If a product is of poor quality, it will have a short life cycle. There is a cost involved. The cost of poor quality can be defined as the sum of all costs that would disappear if there were no quality problems. Examples of poor quality costs include scrap and rework, supplier corrective action, downgraded end product, warranty costs, loss of future sales, recall costs, and returned costs. JIT often is wrongly thought of as a way to decrease inventories alone. While the reduction of inventories is a major benefit of the JIT process, the increased product quality is the major benefit. This occurs as the result of the philosophy of JIT (Epps, 1995).


2. Agile Manufacturing


            Agile manufacturing was initially an apparel industry concept, but essential in any responsive operations system. Agile operations strategies grew out of the inability of Japanese manufacturing techniques to cope with a movement beyond variety to mass customization and personalization. The agile manufacturer aims to produce highly customized products at a cost comparable with mass production and within short lead times. Combined with QR, the resultant tailoring of products to demand includes a higher element of service and thus greater added value. A flexible workforce, structure and production technologies are all contained within a learning culture. Externally, the concepts of vertical integration and long-term partnerships are replaced with short-term, flexible contracts and horizontal outsourcing. These allow rapid response through an expansive system of communication networks (Lowson 2002).


3. Quick Response


            Quick Response (QR), a program developed by textile and apparel manufacturers and retailers around 1985 as a way to cope with problems challenging the apparel industry, uses a combination of strategies to reduce inventory levels, improve merchandise quality, increase worker productivity, increase stock turnover, and reduce merchandise markdowns and inventory costs. Fundamentally, QR is a way to gather information about consumer preferences and to reflect them in production decisions in a timely manner. To comply with consumers’ needs, QR relies on sales data. Through computerized information systems, sales data are transmitted and transformed as useful information that reveals consumers’ preferences and reactions, and decisions are then made promptly to respond to what consumers want (Kang and Sullivan, 1999).


            The QR strategy links all activity to real time demand. It is customized by the individual retailer or manufacturer and is particularly suited to small and medium-sized firms. It is designed to be context specific and to be contingent upon the setting. Quick Response as an operations strategy is designed to overcome the impact of seasonality in operations.


4. Strategic Postponement


            Postponement is an operations strategy that aims at delaying activities until the exact attributes of demand can be identified. Postponement can take three forms:


Time – delaying activities until orders are received


Place – delaying the movement of goods until orders are received


Form – delaying activities that determine final form of a good until demand is known.


 


 


Case Studies


            In this section, some examples of organizations that employ different Post-Fordist approaches to productions and manufacturing will be presented.


1. United Colors of Benetton


            United Colors of Benetton is a popular Italian fashion retailer that is present in 120 countries around the world (Benetton, Annual Report 2007).


            The goal of Benetton is to expand its sales network while at the same time minimize the cost and increase the sales of its products. In order to achieve this goal, the company needs to achieve a higher degree of flexibility. In order to achieve the company’s goals and to make sure that the products that the company produced are what the customers needed, Benetton employs a Quick Response strategy. Quick Response entails a high degree of flexibility in production and decision making. The company also employs Strategic Postponement and the products that they produced are Standardized. Strategic postponement enables Benetton to start the manufacturing process and then delay the process until customer demands and requirements (such as color, style and fit) are determined.


2. Zara


            Zara is one of the most notable fashion stores in the world. Notable for its products and notable for its excellent supply chain management. The first Zara clothing store opened in 1975 in Spain as a small retailer selling men’s and women’s clothing. Since then Zara chains have grown into retailing giants with almost 1000 stores worldwide and an impressive sales record. The success of Zara is partly to do with the appeal of its men’s and women’s and children’s fashions and accessories that display unique style but at real world prices. But it is also partly as a result of their collaborative, digital networks that link Zara with its suppliers and customers. These advances have enabled Zara to deliver tailored products quickly and reliably, creating what the company terms a ‘value net’ for all the firms in the supply network (Zara, Annual Report 2007).


            Zara, a Spanish fashion retailer is famous for its efficient and effective supply chain. Zara employs Agile Manufacturing. The manufacturing at Zara starts at its retail stores which acts as the eyes and ears of the company. Instead of relying solely on electronically collected data, Zara utilizes word of mouth information to understand its customers and to determined their needs, wants and requirements. The manufacturing process of Zara is so agile it can produce high end fashionable clothes in just two weeks. Products that re not selling well are quickly pulled and popular items are quickly replenished. Zara hires young designers and empowers them to make quick decisions.


            The supply chain starts from the retail stores and customers, the use and flow of information enables Zara to convert the high degree of information into opportunity. Agile manufacturing is present from the acquirement of customer feedbacks. Customer feedbacks that are gathered in the stores are sent to the company’s Design Team. The design team sends the information to the cutting department and fabric department to ensure the right pattern in produced. Zara uses lean manufacturing in specialized factories while processes such as cutting, stitching, and dying are standardized.


 


Conclusion


            From the discussion above, I can say that the Fordist era of production and manufacturing is over and that the Apparel or Fashion industry is in the Post-Fordist era. The Fordist paradigm lost its popularity because of different factors and changes in demands, competition, and in technology. The concept of mass production is now replaced with mass customization and other concepts that aim to achieve flexibility, specialization, and quality. Mass customization became popular because it offered companies with the capabilities to mass produce customized and high quality products in a timely manner. Moreover, other manufacturing and production concepts have emerged. Notable among these are Just-in-Time manufacturing and Agile manufacturing.


 


 


 


References


 


Annual Report 2007, Inditex, viewed 29 October, 2008, <http://www.inditex.com/en/shareholders_and_investors/investor_relations/annual_reports>


 


Annual Report 2007, United Colors of Benetton, viewed 29 October, 2008,  <http://media.corporate-ir.net/media_files/irol/11/114079/reports/AnnualReport07_080331.pdf>


 


Black, J T and Chen, J C 1995, ‘The Role of Decouplers in JIT Pull Apparel Cells’, International Journal of Clothing and Technology, vol. 7, no. 1, pp. 17-35


 


Clegg, S R 1989, Frameworks of Power, Sage, London.


 


Davis, S 1996, Future Perfect, Addison Wesley, Reading MA.


 


Duray, R 2002, ‘Mass Customization’, in P M Swamidass (ed.), Innovations in Competitive Manufacturing (pp.275-282), AMACOM, New York.


 


Epps, R 1995, ‘Just-in-Time Inventory Management: Implementation of a Successful Program’, Review of Business, vol. 17, no. 1, pp. 40+.


 


Hall, S and Jaques, M 1989, New Times: The Changing Face of Politics in the 1990s, Lawrence & Wishart, London.


 


Harvey, D 1989, The Condition of Post-Modernity, Blackwell, Oxford.


 


Jakupec, V and Garrick J (eds.) 2000, Flexible Learning, Human Resource, and Organisational Development: Putting Theory to Work, Routledge, London.


 


Kang, J K & P Sullivan 1999, ‘Quick Response Adoption in the Apparel Manufacturing Industry: Competitive Advantage of Innovation’, Journal of Small Business Management, vol. 37, no. 1, p. 1.


 


Lowson, R 2002, Strategic Operations Management: The New Competitive Advantage, Routledge, New York.


 


Mcloughlin, I 1999, Creative Technological Change: The Shaping of Technology and Organisations, Routledge, London.


 


Piore, M J and Sabel, C F 1984, The Second Industrial Divide: Possibilities for Prosperity, Basic Books, New York.


 


Lash, S and Urry J 1987, The End of Organized Capitalism, Polity Press, Cambridge.


 


Reddy, A 1994, Total Quality Marketing: The Key to Regaining Market Shares, Quorum Books, Westport CT.


Sabel, C F 1982, Work and Politics: The Division of Labour in Industry, Cambridge University Press, Cambridge.


 


Wood, S 1989, The Transformation of Work?, Unwin Hyman, London.


 



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