Engineers in Japan and Britain: Education, Training and Employment (Nissan Institute Routledge Japanese Studies Series)

Engineers in Japan and Britain

Engineers are a key occupational group in the transformation of the modern world. Contrasts between Japan’s ‘economic miracle’ and Britain’s relative economic decline have often been linked to differences in the education, training and employment of engineers. Yet, such views have often rested on little more than colourful anecdotes and selective statistics. Using careful and systematic comparison, Kevin McCormick examines the approaches to the training and education of engineers in Britain and Japan. He highlights the importance of several foreign engineering traditions and postwar industrial reforms as well as analysing the education, training and employment of R&D workers. Drawing on a wide range of literature and direct involvement in several comparative and collaborative projects, the author presents accounts of past, present and future developments in the engineering professions of Japan and Britain. Professional engineers, engineering managers, industrial policy makers as well as students and researchers in human resource management, business studies and Asian studies will find this book an invaluable source of data and analysis which is not available elsewhere in the English language. Kevin McCormick is Senior Lecturer in Sociology at the University of Sussex. He is the co-author of Japanese Companies: British Factories.

The Nissan Institute/Routledge Japanese Studies Series Editorial Board J.A.A.Stockwin, Nissan Professor of Modern Japanese Studies, University of Oxford and Director, Nissan Institute of Japanese Studies; Teigo Yoshida, formerly Professor of the University of Tokyo; now Professor, Obirin University; Frank Langdon, Professor, Institute of International Relations, University of British Columbia, Canada; Alan Rix, Executive Dean, Faculty of Arts, The University of Queensland; Junji Banno, Chiba University; Leonard Schoppa, University of Virginia Other titles in the series: The Myth of Japanese Uniqueness Peter Dale The Emperor’s Adviser: Saionji Kinmochi and Pre-war Japanese Politics Lesley Connors A History of Japanese Economic Thought Tessa Morris-Suzuki The Establishment of the Japanese Constitutional System Junji Banno, translated by J.A.A.Stockwin

Japan and Protection: The Growth of Protectionist Sentiment and the Japanese Response Syed Jawed Maswood The Soil, by Nagastsuka Takashi: A Portrait of Rural Life in Meiji Japan translated and with an introduction by Ann Waswo Biotechnology in Japan Malcolm Brock Britain’s Educational Reform: A Comparison with Japan Michael Howarth

Industrial Relations in Japan: The Peripheral Workforce Norma Chalmers

Language and the Modern State: The Reform of Written Japanese Nanette Twine

Banking Policy in Japan: American Efforts at Reform During the Occupation William M.Tsutsui

Industrial Harmony in Modern Japan: The Intervention of a Tradition W.Dean Kinzley

Educational Reform in Japan Leonard Schoppa

Japanese Science Fiction: A View of a Changing Society Robert Matthew

How the Japanese Learn to Work: Second Edition Ronald P.Dore and Mari Sako Japanese Economic Development and Industrial Practice: Second Edition Penelope Francks

The Japanese Numbers Game: The Use and Understanding of Numbers in Modern Japan Thomas Crump

Ideology and Practice in Modern Japan Edited by Roger Goodman and Kirsten Refsing Technology and Industrial Development in pre-War Japan Yukiko Fukasaku Japan’s Early Parliaments 1890– 1905 Andrew Fraser, R.H.P.Mason and Philip Mitchell Japan’s Foreign Aid Challenge Alan Rix Emperor Hirohito and Showa Japan Stephen S.Large Japan: Beyond the End of History David Williams Ceremony and Ritual in Japan: Religious Practices in an Industrialized Society Edited by Jan van Bremen and D.P.Martinez Understanding Japanese Society: Second Edition Joy Hendry The Fantastic in Modern Japanese Literature: The Subversion of Modernity Susan J.Napier Militarization and Demilitarization in Contemporary Japan Glenn D.Hook Growing a Japanese Science City: Communication in Scientific Research James W.Dearing Architecture and Authority in Japan William H.Coaldrake

Women’s Gidayu and the Japanese Theatre Tradition A.Kimi Coaldrake Democracy in Post-war Japan Rikki Kersten Treacherous Women of Imperial Japan Hélène Bowen Raddeker Japanese-German Business Relations Akira Kudo Japan, Race and Equality Naoko Shimazu Japan, Internationalism and the UN Ronald Dore Life in a Japanese Women’s College Brian J.McVeigh On the Margins of Japanese Society Carolyn S.Stevens The Dynamics of Japan’s Relations with Africa weku Ampiah The Right to Life in Japan Noel Williams The Nature of the Japanese State Brian J.McVeigh Society and the State in Inter-war Japan Elise K.Tipton Japanese-Soviet/Russian Relations since 1945 Kimie Hara Green Politics in Japan Lam Peng-Er The Japanese High School: Silence and Resistance Shoko Yoneyama

Engineers in Japan and Britain Education, Training and Employment

Kevin McCormick

London and New York

First published 2000 by Routledge 11 New Fetter Lane, London EC4P 4EE Simultaneously published in the USA and Canada by Routledge 29 West 35th Street, New York, NY 10001 Routledge is an imprint of the Taylor & Francis Group This edition published in the Taylor & Francis e-Library, 2002. © 2000 Kevin McCormick All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data McCormick, Kevin, 1944– Engineers in Japan and Britain: education, training and employment/Kevin McCormick. p. cm. —(Nissan Institute/Routledge Japanese studies series) Includes bibliographical references and index. 1. Engineering—Study and teaching—Japan. 2. Engineering— Study and teaching—Great Britain. 3. Engineers—Training of— Japan. 4. Engineers—Training of—Great Britain. I. Title. II. Series. T155.M37 1998 99–14505 620’.0071’052–dc21 CIP ISBN 0-415-16181-9 (Print edition) ISBN 0-203-01401-4 Master e-book ISBN ISBN 0-203-20514-6 (Glassbook Format)

In Memoriam Brian McCormick (1931–1998)

Contents

List of figures List of tables List of abbreviations Acknowledgements Series editor’s preface

1

Introduction

1

Historical legacies for engineers

9

Introduction 9 Debates on Henry Dyer 11 Developments before 1914 13 The inter-war years 22 After 1945 25 Institutional histories: UMIST and TIT Conclusions 40 Notes 45 2

xii xiii xvi xix xxi

32

International rankings of engineers Introduction 46 Controversial numbers 48 Outlines of the two educational systems 54 The implicit qualitative dimensions of comparison 62 The social standing of engineers 72 Conclusions 79 Notes 80

46

x

3

Contents

Engineers and the lifetime employment system

81

Introduction 81 The lifetime employment system 83 Recruitment and selection 85 Training and assignments 90 Pay and careers 94 Lifetime employment, business strategy and in-company training The changing context of the lifetime employment system 106 Conclusions 108 4

Engineering innovation: from ‘national systems’ to corporate laboratories and projects Introduction 112 National systems of innovation 114 Comparing engineers in the innovation process 119 The International Research Group on R&D Management Corporate R&D 130 Project organisation 145 R&D outputs: patents and papers 148 Conclusions 151 Note 153

5

102

112

126

Building skills and careers in research and development

154

Introduction: skill formation and career development 154 Employment systems: ‘market-oriented’ versus ‘organisationoriented’ 155 Career timetables 157 Building the R&D workforce: company policies and practices 162 Knowledge and skill formation 167 Reforming education and training: industrial perspectives 173 Discussion 176 6

Research and development work: its contents and discontents Introduction 180 Engineers and scientists as professionals in industry 181 The paradoxical professionalism of Japan’s R&D workers 188 R&D inputs: working hours 191 Managing project work 194 Reward systems 197

180

Contents

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Contents and discontents 198 The scope for collective voice: professional institutions and unions 204 Conclusions 209 Note 215 7

Engineering transplants

216

Introduction 216 The supply side of Japanese foreign direct investment 218 The demand for Japanese foreign direct investment 219 Debates on ‘Japanisation’ and technology transfer 222 Transplants and the employment of engineers: a survey 225 The organisation of engineering work 228 R&D: the ‘attached’ and the ‘independent’ R&D units 249 Conclusions 252 Notes 257 8

Conclusions: comparisons and contrasts between engineers

258

Introduction 258 Becoming professional engineers 260 Models of the organisation and production of technical labour 263 Conclusions: diverse comparisons and diverse engineers 269 Note 275 Bibliography Index

276 297

Figures

2.1 Progression routes in the Japanese educational system (1994) 4.1 Number of research institutions established by Japanese companies 5.1 The organisation of skill formation 6.1 Wage composition under the seniority-oriented system 6.2 Salary composition under shokunoshikaku system 7.1 A checklist of ‘Japanisation’ 7.2 Colour television manufacturing processes 7.3 Career paths in Terebi TV Company

55 133 163 198 199 223 231 233

Tables

1.1

A comparison of the careers and salaries of engineering and business graduates in Mitsubishi Zaibatsu (1886–1916) 20 2.1 Number of higher-education students by subject 50 2.2 Engineering graduates in the UK, France, Germany, Japan and USA 53 2.3 A-level points scores for British entrants to university engineering and history (1995) 64 2.4a Hensachi scores for engineering entry to public universities (1988) 66 2.4b Hensachi scores for engineering entry to private universities (1988) 66 2.5 Hensachi scores for entry to science and engineering (1997) 67 3.1 Financial structures, company performance and labour force data for a sample of Japanese companies 84 3.2 Differences in monthly contractual earnings by age group 97 3.3 Differences in annual cash earnings (bonus included) by sector, education and age group (males) 98–9 3.4 Differences in regular monthly salary by job cluster 100 3.5 Wage differences by job cluster: male white-collar workers (university or college graduates) in manufacturing industry 101 3.6 Wage differences by job cluster: male white-collar workers (university or college graduates) in manufacturing industry 101 4.1 Educational backgrounds of senior officials at the Ministry of International Trade and Industry (MITI) (1988) 128 4.2 Basic data on sample survey companies in Japan and Britain 129 4.3 Employment mobility (percentage changing company) 131 4.4 Percentage of the company respondents who joined the company after graduation and the percentage who were mid-career recruits 131 4.5 Percentage of R&D staff applying for patents by area of work and country 148 4.6 Percentage of R&D staff with published papers by area of work and country 148 4.7 Percentage of Japanese R&D staff applying for patents by company 149 4.8 Percentage of British R&D staff applying for patents

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4.9 4.10 4.11 4.12 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12

List of tables

by company Percentage of Japanese R&D staff publishing papers by company Percentage of British R&D staff publishing papers by company Reward levels by patent application and publication A comparison of the world rankings in basic research and industrial R&D Preferred future (type of organisation) by current work location Proportion of each age group preferring a company move by age group Career timetables Actual age on reaching career milestones Ideal age to reach career milestones Preferred future types of work by current work location The relation between age and effectiveness as a front-line R&D worker Job search channels after graduation in four countries Job search channels after graduation in Japan Effective methods of knowledge and skill development Forms of work experienced since entering the current company Self-initiated versus directed participation in off-the-job training Reasons given for participation in off-the-job training courses Reasons for the need to further develop knowledge and skills Areas needing curriculum reform in university and company education Personal goals of R&D workers in four countries R&D workers’ membership in professional organisations in four countries Importance attached to work goals by R&D workers in Britain and Japan Importance attached to work goals by ‘research’ or ‘development’ function in Japan and Britain R&D staff reporting out-of-work social contacts with colleagues R&D staff reporting out-of-work social contacts with supervisors Number of projects for which an R&D staff member is responsible by position Reward level by age cohort Reward level by stage of career development Degree of satisfaction with aspects of work in Japan Degree of satisfaction with aspects of work in Britain Sources of dissatisfactions among Japanese R&D staff

149 150 150 150 152 157 157 158 160 161 161 162 164 165 169 172 172 173 173 175 189 190 192 193 194 195 196 197 198 200 200 201

List of tables

6.13 Sources of dissatisfactions among British R&D staff 6.14 Japanese membership of collective organisations (unions and professional institutions) 6.15 British membership of collective organisations (unions and professional institutions) 6.16 The significance of professional institution membership in Japan 6.17 The significance of professional institution membership in Britain 6.18 Benefits of professional organisation membership in Japan 6.19 Benefits of professional organisation membership in Britain 6.20 Benefits of union membership in Japan 6.21 Benefits of union membership in Britain 7.1 Manufacturing plants and the R&D intensity of Japanese manufacturing in Europe 7.2 Number of R&D units established by Japanese companies in Europe 7.3 Plant size and number of Japanese graduate engineers 7.4 Plant size and number of UK graduate engineers 7.5 UK engineers compared to expatriate Japanese engineers 7.6 Characteristics of Japanese R&D units in Europe 7.7 Parent company industries of principal independent R&D centres in the UK 8.1 Models for the production and organisation of technical labour 8.2 Dimensions of the production and organisation of engineers

xv

202 206 206 207 207 210 211 212 213 220 221 227 227 242 251 251 265 269

Abbreviations

A level AFE BEng BER BTEC BTech CATs CGLE CNAA CRL CRNS CRT CTV D&D DES

DTI EEC EIAJ ESRC EPA GCE GDP GEM GNVQ

HMSO HNC HND IDS IFO IMS ISCED JETRO

Advanced level Advanced Further Education Bachelor of Engineering Board of Engineering Registration Business and Technical Education Council Bachelor of Technology Colleges of Advanced Technology City and Guilds of London Institute Council of National Academic Awards Central Research Laboratory Centre National de Recherche Scientifique Cathode ray tube Colour television Design and development Department of Education and Science. Having taken over some of the functions of the employment department, it has become the Department for Education and Employment (DfEE) Department of Trade and Industry European Economic Community Electronic Industries Association of Japan Economic and Social Research Council Economic Planning Agency General Certificate of Education Gross Domestic Product Graduate Research Institute of Economics and Management General National Vocational Qualifications overseen by the National Council for Vocational Qualification (NCVQ) Her Majesty’s Stationery Office Higher National Certificate Higher National Diploma Institute for Development Studies Institut für Wirtschaftsforschung e.V., Munich. One of the major economic ‘think tanks’ in Germany Institute of Manpower Studies (now renamed to Institute for Employment Studies) at the University of Sussex International Standard Classification of Education Japan External Trade Organisation

List of abbreviations JIL JPC JSME JSPS LEST LSE MEng MIT MITI MSC NAFE NCTA (CNTA) NCUEE NEDC NEDO NIER NISTEP NTSC

OECD o-j-t OTA PAL

PhD QC QSEs

QSETs R&D RE RE(Assoc) REng(Dip) SARTOR SCAP SECAM

SERC SPRU STA STC TIT TUC UGC UK UKAEA

Japan Institute of Labour Japan Productivity Centre Japanese Society of Mechanical Engineers Japan Society for the Promotion of Science Laboratoire d’Economie et de Sociologie du Travail London School of Economics Master of Engineering Massachusetts Institute of Technology Ministry of International Trade and Industry Manpower Services Commission Non-Advanced Further Education National Council (or Council of National) Technological Awards National Centre for University Entrance Examination National Economic Development Council National Economic Development Organisation National Institute for Educational Research National Institute of Science and Technology Policy One of the three systems used for encoding colour picture information for transmission, the US National Television System Commission (NTSC) system has been adopted across Canada, Mexico and Japan Organisation for Economic Co-operation and Development On-the-job training Office of Technology Assessment The ‘Phase Alteration Line’ system is the encoding system adopted in the UK and most other West European countries Doctor of Philosophy Quality control Qualified scientists and engineers. This classification was used by official advisory bodies on scientific and technological manpower reports and surveys in the 1950s and 1960s Qualified scientists, engineers and technologists Research and development Registered Engineer Registered Engineer Associate Registered Engineer Diplomate Standards and Routes to Registration Supreme Commander Allied Powers The ‘Système Electronique Couleur Avec Memoire’ (SECAM) is the colour encoding system originally developed in France, and later adopted in Eastern Europe and the former Soviet Union Science and Engineering Research Council Science Policy Research Institute Science and Technology Agency Standard Telephones and Cables Tokyo Institute of Technology Trade Union Congress University Grants Committee United Kingdom United Kingdom Atomic Energy Authority

xvii

xviii

List of abbreviations

UMIST UNESCO US USA USSR v. VTR

University of Manchester Institute of Science and Technology United Nations Educational, Scientific and Cultural Organisation United States United States of America Union of Socialist Soviet Republics Versus Video-tape recorder

Acknowledgements

A stimulus to pull together some of the threads of a body of research on the education, training and employment of graduate-level engineers in Britain and Japan came with an invitation to join the Graduate Research Institute of Economics and Management (GEM) in the Faculty of Economics of Gakushuin University and the generous support of a Japan Society for the Promotion of Science (JSPS) Short Term Fellowship in 1996. Professor Imano Koichiro, my host at Gakushuin University, was one of my collaborators in a comparison of careers in industrial research and development (R&D) in Britain and Japan. My past research had enjoyed a number of valuable collaborative ventures with Japanese scholars. My early studies of the lifetime employment system and its consequences for large and small firms owed much to Umetani Shun’ichiro (Tokyo Gakugei University). Later studies of R&D careers were carried out in Japan and Britain with the generous aid of Imano Koichiro (Gakushuin University), Sato Hiroki (Tokyo University), Yahata Shigemi (Japan Institute of Labour), Fukutani Masanobu (Japan Productivity Centre), and Scott Davis (Reitekku University). This project was then enriched and extended to the United States (US) and to Germany with the support of more collaborators: Philip Shapira (Georgia Institute of Technology), Angelika Ernst and the late Gerhard Wiesner (IFO, Munich). Studies of the role of engineers in transplant operations benefited from research collaboration with Iwauchi Ryochi and Kimoto Shin’ichiro (Meiji University) and Muta Hiromitsu (Tokyo Institute of Technology). Among UK researchers, I have valued working with Peter Senker from the Science Policy Research Institute (SPRU) on small firms in Japan and Britain. A quartet of researchers drawn across three universities—David Cairncross (Imperial College), Brian McCormick (Sheffield University), Alan Turner (Sussex University), and Yumi Hanstock (Sussex University)—joined me in a fruitful study of engineers in transplant operations. I am grateful to several publishers for permission to incorporate revised material from these earlier studies appearing in previously published papers: Routledge for material in Chapter 1 from the volume edited by Howard Gospel (Industiral Training and Technological Innovation: a Comparative and Historical Approach); Falmer Press (now part of International Thomson

xx

Acknowledgements

Publishing) for sections of Chapter 3 drawn from the volume edited by Paul Ryan, (International Comparisons of Vocational Education and Training for Intermediate Skills 1991); Blackwell for material in Chapter 5 (from R&D Management 1995) Chapter 7 (Technology, Work and Employment 1996); Carfax Publishing for material in Chapter 5 (Studies in Higher Education 1993). Financial support for projects was appreciated from a number of sources, including the Unit for Comparative Research on Industrial Relations (Sussex University), Great Britain-Sasakawa Foundation, the Japan Foundation Endowment Committee, the Joint Committee of the Science and Engineering Research Council and the Economic and Social Research Council (SERCESRC), and the ESRC. Ron Dore’s lectures to Sussex undergraduates had whetted an appetite for study of Japanese industrial relations, which was later encouraged and sustained by his writings and wise counsel. The School of Social Sciences in the University of Sussex, nestled between research institutes—such as the Science Policy Research Unit (SPRU), the Institute for Development Studies (IDS), and the Institute for Manpower Studies (re-named as the Institute for Employment Studies)—has provided a congenial research environment. The School of Engineering has provided many cohorts of students and constructive criticism. Specific aid in survey work came from Helen Connor and her colleagues in the Survey Unit of the Institute for Employment Studies and from David Hitchin and his colleagues in the University Computing Centre. Substantive and stylistic improvements have been much appreciated from Nick Von Tunzelmann (SPRU, University of Sussex) on Chapter 1, and from Ozaki Ritsuko (University of Sussex) who did much to enhance the first full draft. Victoria Smith and an anonymous reader provided patient support and guidance from Routledge. It is custom and practice for researchers to acknowledge the support of their contemporary family and this volume provides no exception. My wife and children have borne my absences and distraction with considerable stoicism and followed my travels with tolerant indulgence. However, the seeds of this book were sown and nurtured in family relationships in a more distant past. The conversations of my father, a craftsman engineer, and my older brother, Brian, stimulated my curiosity about the world of work and industrial relations as a schoolboy and led on to my study of industrial relations from the perspectives of economics and sociology. After our mother’s death in April 1995, Brian and I dedicated our co-authored book to the memory of our parents and sister. Following Brian’s sudden death in March 1998, this book acknowledges that rich vein of family indebtedness with a dedication to the brother whose challenging wit, humour and enthusiasm enlivened our journeys through life and the social sciences.

Series editor’s preface

Japan, as the new century begins, has been experiencing a turbulent period in which some of her most cherished institutions and practices are placed under critical scrutiny. The financial crisis that began in the latter half of 1997—but whose origins go back several years earlier—gravely affected Japan as well as other Asian countries. Quite apart from the economic and political implications of recession, including bankruptcies and increased unemployment, the crisis had a marked impact on the psychology of ordinary people. They had been accustomed to steadily increasing proseprity and the international respect generated by the successes of their politico-economic model. Now, however, they were coming to wonder whether attitudes and ways of doing things that had been central to their lives and outlook over several decades were still appropriate to the disturbingly unstable world in which they now found themselves. One straw in the wind was a hugely popular soap opera on Fuji Television in the spring of 1998, entitled Shomu 2 (General Affairs Section 2), in which a group of women office workers egotistically assert their rights as individuals and challenge time-honoured working practices. By challenging the prevailing atmosphere of inefficiency, refusal to face up to responsibilities, conformism, sexual harassment of women and mindless deference to hierarchy, this feisty group of ‘office ladies’ succeed in saving the company from bankruptcy. However much of a caricature the Fuji TV soap opera may be, it is symptomatic of a sense that not all is right in what used to be seen as an unbeatable set of methods for running society. Grave though the crisis being faced by Japan was, the impressive human and material resources that the country was still able to command were advantageous in the struggle to overcome the crisis. Whatever might be the outcome at the economic level, however, a troubling intellectual problem remained. Few could doubt that radical reform was needed, but if this reform were simply to be a case of conformity with the norms of an America-centred global economy (following the principles of the free market and egotistical individualism), where did that leave the status of Japanese values? History suggested that simple acceptance of foreign models was an unlikely outcome, and that ultimately a creative solution might emerge,

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Series editor’s preface

mixing external with indigenous elements. To follow this process over the coming years should be an intriguing task. The Nissan Institute/Routledge Japanese Studies Series seeks to foster an informed and balanced, but not uncritical, understanding of Japan. One aim of the series is to show the depth and variety of Japanese institutions, practices and ideas. Another is, by using comparisons, to see what lessons, positive or negative, may be drawn for other countries. The tendency in commentary on Japan to resort to outdated, ill-informed or sensational stereotypes still remains, and needs to be combated. The role of engineers in industrial development is self-evidently crucial, but different societies undergoing modernisation since the nineteenth century have trained and used engineers in surprisingly different ways and to different extents. Kevin McCormick, in this thorough and penetrating comparison of engineers in Japan and the United Kingdom, is able to demonstrate graphically just how contrasting the patterns in the two countries have been. He is rightly impressed by the effectiveness of the utilisation of engineers in Japan by contrast with Britain, and argues that Japanese companies appear to have got substantially more engineering work out of their engineers, and to have done so without paying premium rates. He relates this to different practices in training, systems of incentives and employment practices, including the ‘lifetime employment’ enjoyed in Japan by core members of the workforce, including many engineers. On the other hand, he sees Japan increasingly adapting innovative best practice in Britain towards the creation of new forms of organisation in a Japanese cultural environment. In so many aspects of Japanese life creative adaptation is the key to understanding new trends, and McCormick’s book constitutes a definitive guide to such trends in the employment of engineers. J.A.A.Stockwin

Introduction

My first meeting with some Japanese engineers was fortuitous (but timely), helpful and instructive. I had slipped from under the protective embrace of my hotel and conference group for a solo saunter into Tokyo. It was easy enough to enter the subway and find my way to a bar in the Shimbashi district. Retracing my steps might have proved beyond my rudimentary map-reading of the subway system without the aid of some drinking companions, who had introduced themselves as ‘Toshiba men’. They were working as engineers in Tokyo and had had a brief (but mixed) experience of England. It was their self-identification by company first, and only secondarily by occupational title that gave that extra thrill of recognition and the feeling that I was in familiar territory. They could have stepped out of the pages of Ronald Dore’s British Factory-Japanese Factory, allowing for their substitution of ‘Toshiba’ for Dore’s ‘Hitachi’. Whatever else might have seemed exotic on my first-time visit to a Tokyo bar, my new-found companions and guides were substantial enough confirmation that my sociology books had some relevance as a starting point for a closer look at the education, training and employment of engineers in contemporary Japan, and for comparisons with Britain. My trip to Japan in 1983 included participation in the Japan Institute of Labour seminar on ‘Japanese industrial relations in action’ and the International Industrial Relations Association Conference in Kyoto. However, the underlying purpose was to discuss the potential for collaborative and comparative studies of engineers in Japan and Britain. All the aims were achieved. Not only were the organised events very informative and stimulating in themselves, but the contacts made and the very positive responses from Japanese researchers have sustained a programme of comparative studies of engineers in Japan and Britain over several years. During the 1980s, Japanese companies and schools became a source of much-discussed models and exemplary lessons-to-be-learned, not only in Britain, but more widely in Europe and America. Japan was no longer of interest simply as a model for third-world aspirants to join the list of industrialised nations. Japan appeared to have ‘lessons’ for the regeneration of flagging industrialised economies. For both the first and third worlds, Japan appeared to offer exemplary models of economic growth and a seemingly boundless capacity to bounce back from adversity.

2

Engineers in Japan and Britain

Interpretations of Japan have been undergoing revision in the 1990s. The failure to develop a sustained period of economic growth after the collapse of the ‘bubble economy’ in the 1991 recession has made it difficult to dismiss problems as a short-term performance blip on the general trend. There are strong grounds for believing that Japan has been facing severe structural changes too. The combined difficulties of a cyclical downturn on top of serious structural change have been exacerbated by the failure to cope with financial reform. The ‘bad debts’ which stemmed from the risky loans in the euphoric lending of the bubble economy have still been haunting the economy and undermining confidence in the financial and political systems eight years later. The evidence that financial institutions were colluding with sokaiya groups to cover their losses added to public outrage about the financial institutions and put constraints on the government’s room for manoeuvre. Government could hardly risk being seen to use taxpayers’ funds to ease the lot of criminal groups, particularly after the deep political divisions which followed government attempts to bail out financial institutions mired with the taint of financial impropriety in the jusen housing loan scandal. The very financial system which was praised for underpinning the long-term view of manufacturers by providing ‘patient capital’ is now criticised for its lack of transparency and potential corruption. What were once praised as virtues are seen on the reverse side of the coin as vices. If financial reform includes more deregulation in the sense of freer access to international capital markets but more stringent and effective operation of the remaining regulatory mechanisms, then Japanese manufacturers may lose ready access to that patient capital and may be required to operate with more regard to shareholders and the shorter term. Considerations such as these suggest that the continuing success of Japan’s manufacturers is neither ‘inevitable’ nor ‘inexorable’. Japanese manufacturers will have to learn how to achieve success in a new context, one in which the ‘east Asian miracle’ is becoming unbundled for a variety of reasons. After years of struggling with the high value of the yen, companies have had some relief with currency depreciation. This may prove to be only a temporary respite as the value of the Korean won collapsed by 40 percent in autumn 1997 and made Korean products very competitive in price. Yet just as it was unwise to over-exaggerate the virtues of Japanese engineers and engineering in the 1980s, so it would be foolish to exaggerate the vices of the system in which they operate in the late 1990s. The competitive strengths of Japanese manufacturing companies cannot be dismissed lightly and written off. Companies in the leading industries—automobile, electronics and machine tools—have some of the best applied engineering in the world, with great strengths in product development and manufacture. Companies have been putting increased effort into cost reduction, quality improvement and technological advances (Berggren and Nomura 1997). Some companies are using their vast resources of skilled engineers and proprietary technology to refocus themselves: for example, Toshiba is realigning its activities from abroad-based electronics company to an information technology company. One of the outcomes of the difficult trading situation in Japan and the intensified international competition from a resurgent

Introduction

3

US and a desperate Korea might be increasing polarisation within Japanese industries as the leaders within industries become stronger and the weaker companies struggle deeper in their difficulties. While the shine of the Japanese model has been somewhat dimmed, even tarnished, by the long recession of the early 1990s, the workings of Japanese institutions are still much debated. As in many debates, views become polarised. Japan seems to excite some unusually inflamed passions in international comparisons, from its staunch advocates to its fierce detractors. Often, views about the way that institutions are supposed to work or sheer wishful thinking have become closely enmeshed with purportedly straightforward description and explanation. This book addresses many of the themes in those debates and it is intended to provide a systematic overview of the subsequent research, taking a closer look at the institutions which regulate the education, training and employment of engineers in the two countries. By looking at the institutional arrangements for the education, training and employment of engineers, their progressive development and the people who pass through them, we can find a convenient point of entry to some of the debates about the wider picture of economic and social development in Japan and Britain over the course of industrialisation. It is hardly surprising that engineers should attract attention in discussions of industrialism and industrialisation. Indeed, the surprise might be that they do not attract more attention. As an occupational group, engineers were put at the centre of the very conception of an ‘industrial society’ by the man who coined the term, Henri St Simon, a French aristocrat who perceived the collapse of the ancien régime in eighteenth-century France and the emergence of a new moral and material order. St Simon saw the need for a new national elite, to include engineers, to build national wealth through productive effort and to replace the aristocracy whose skills lay in war and diplomacy. St Simon’s ideas had their tangible impact on French industrialisation in the 1850s when engineers groomed in the grandes écoles reached positions of influence. The creation of specialist institutions for the education of high-level engineers was one of the central features of continental Europe’s drive for industrialisation. In 1868, when Japan brought to an end over 260 years of semi-centralised feudalism under the control of the Tokugawa clan, the newly restored emperor took the title of Meiji (Enlightenment). The Meiji government put building Japan’s industrial strength high on their agenda in order to escape from the feudal order and to avoid the risk of foreign encroachment. They sent emissaries to England in the 1870s, then the ‘workshop of the world’, to recruit an English engineer to develop a government-sponsored engineering college that would develop a corps of engineers to handle imported technology and to build an indigenous capability for industrial development. They returned with a Scot, and a century later, Japan itself had become a respected source of engineering ‘best practice’ in manufacturing industry. In the 1970s, the British government, disappointed by the levels of national economic performance, especially in the manufacturing industry, sent its own mission under the chairmanship of Sir Monty Finniston to

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Engineers in Japan and Britain

learn about the education, training and employment of engineers in Japan and to report on any potential lessons to guide the reform of the engineering profession in Britain. We might have expected that the recognition of the centrality of engineers to industrial progress, the workings of competitive pressures in capitalist industrialism and all the efforts to study rivals and to ‘learn from abroad’ would lead to a greater convergence in the ways that engineers are educated, trained and employed in industrial societies. Yet, considerable variety remains. Moreover, although there is wide agreement that engineers are important, it is much less clear who engineers are, what they do, and just how important they are. The term ‘engineer’ is quite elastic within most industrial societies and there is considerable variety internationally in the ways that engineers are formed. Because of their importance, both historically and in contemporary societies, there has been a growing interest in international comparisons, of which my own studies are just one example. The approach adopted here for the comparative study of the education, training and employment of engineers is familiar among sociologists conducting comparative studies of social institutions and the processes of institutionalisation. Social institutions are important in social structures since they socialise new members, regulate clusters of roles and order social conduct through norms and sanctions. While educational institutions, such as universities, take their place among cultural and socialisation institutions regulating the development of science and the scientific labour force, economic institutions, such as business corporations, regulate the production of goods and services. Meanwhile the concept of ‘institutionalisation’ serves as a reminder that social institutions have to be built and social practices become sufficiently constant and persistent that they carry the stamp of legitimacy. Nevertheless, while social institutions become established, they can suffer crises, become subjects of national debate and undergo reform or replacement. In trying to compare institutions across societies, sociologists have immediately faced questions about whether like is being compared with like and just what counts as an ‘engineer’ in either country. There are no simple answers. Very broadly, I shall take a pragmatic solution to put the focus on those people employed in industry as ‘engineers’ with university-level (or equivalent) education. In other words, I shall take the employers’ definitions. However, this can be contested in many ways. The ‘equivalence’ might admit those with sub-university education or those with science education. Such issues provide rich material for ‘occupational politics’ and for educational and occupational pressure groups keen to achieve the closure of labour markets and establish a particular preserve. In Britain, this is evident in pressures for an all-graduate profession and sharp boundaries between ‘professional engineers’ and ‘technicians’ or between ‘engineers’ and ‘scientists’. Employers, however, have preferred to retain their freedom of action to appoint those whom they have deemed would meet their functional requirements. In workplaces where occupational titles are contested, sociologists have responded by attempting to devise generic titles such as ‘technologists’ or ‘technical workers’ or ‘R&D workers’. None is wholly satisfactory. Technological advances and

Introduction

5

increasing economic and organisational complexity undermine efforts to freeze universally valid definitions or to sustain professional licensing. Differences in national engineering formation prompt a number of questions about the relative strength of those pressures (such as competitive pressures) which might encourage growing similarity against those other pressures (such as culture or history) which might sustain continuing differences. The Japanese term for ‘engineer’, gijutsusha, has considerable elasticity and can be used to cover both ‘engineer’ and ‘technician’. To speak of ‘university-level engineers’ raises questions about whether ‘university’ has the same meaning across countries. Setting out with a pragmatic definition of ‘engineer’ and a brief to investigate how engineers are educated, trained and employed in two advanced capitalist countries, leads inevitably to some of the wider debates among social scientists about the varieties of capitalist industrialism and to contemporary debates about the impact of global forces and the prospects for increasing convergence among capitalist economies. For this volume, I have set the following agenda of questions: • • • • • • • •

How important are the historical legacies for today’s engineers? Do international rankings of the numbers of engineers produced matter? Does lifetime employment make any difference to the training of engineers? What part do engineers play in the organisation of innovation? How do engineers and scientists develop their skills and careers in R&D? What is R&D work and what are its satisfactions and dissatisfactions? Can engineers transplant ‘best practice’ methods across countries? What have we learned about engineers through comparative study?

The apparent failure of the British government to promote advanced technological education in the late nineteenth century has been contrasted with the apparent readiness of the Japanese government to establish a College of Engineering has a resonance with wider economic and social history debates in Britain and Japan. In looking at the evident success of the Japanese economy from the 1950s, some writers have been tempted to advance historical explanations and to see deep roots into the nineteenth century to explain the post-war success. This line of explanation has its parallel in historical accounts of the deep roots for Britain’s relative economic decline. Thus, there is a strong temptation to run the story of Japan’s rise and Britain’s decline in tandem, posing the question: did the Japanese government lay the foundations for subsequent success just as British governments lost their way, particularly in relation to engineers? Chapter 1 shows the close involvement of British engineers in the early Japanese efforts to industrialise and some of the ironies in the subsequent development of engineering formation and the perceptions of economic performance in the two countries. The story of Henry Dyer, a young Scots engineer appointed by the Meiji government to found an engineering college in 1877, provides a starting point for the view that Japan was doing something right (and Britain was failing to do something) in the late nineteenth century. Dyer’s own comments on his experiences can be picked up in two ways— on the one hand, as historical support for the later debate about ‘the late development

6

Engineers in Japan and Britain

effect’ in Japan, and on the other hand, as a comment about the ‘cultural malaise’ which some argue exacerbated Britain’s relative economic decline from the late nineteenth century. My own argument is that there is a ‘grain of truth’ in the argument—Japan did begin to establish higher-level institutions for the formal education of engineers in the late nineteenth century while Britain relied much more on informal methods for longer for a larger proportion of its elite engineers. However, I shall argue further that seeing contemporary arrangements in Japan (the relatively large number of engineers produced, the relatively high share of the more able students who study engineering and the propensity of university engineers to reach senior levels in the manufacturing industry) compared with Britain as largely the outcome of decisions of great-great-grandfathers is simplistic and neglects much that is historically contentious in the experiences of both countries. One of the key charges laid against British institutions is that they failed to adapt to the needs of modern industrialism—for example, failing to produce the numbers of engineers demanded by employers. International rankings of the numbers of engineers produced have been one of the more widely quoted summary statistics of international comparison. The rankings were the labour-force corollary of the widespread interest in rankings of economic growth. The ‘failure’ to match Japan’s alleged numerical superiority became one of the sticks to beat government in Britain and the US. It seemed a self-evident symbol of government failure to get a grip on the educational system and use it to support industry and promote economic growth. However, Chapter 2 shows that many influential Anglo-Japanese comparisons were wildly inaccurate. Part of the process of refinement in the comparisons, and making sure that like is compared with like, lies in getting a better understanding of terms like ‘engineer’, ‘graduate’ and ‘university’. Therefore this chapter will involve going behind the numbers to look at the structure of the two educational systems and how they operate. The relative standing of engineers has often been assumed to be high in Japan in contrast to the allegedly lowly position of engineers in Britain. However, closer examination of the available evidence suggests that these comparisons have been wildly overdrawn too. Even if Japan does produce two-and-a-half times as many engineers as the UK (per head of population), what does Japan do with them? This means moving from the education system to employment. To many observers it seemed intuitively obvious that with the lifetime employment system Japanese companies would be much more generous investors in the training of their employees than foreign counterparts. However, attempts to document training costs have suggested that Japanese companies spend less on training. Chapter 3 argues that the level of training effort cannot properly be gauged from financial measures or training budgets alone since the context of lifetime employment makes a good deal of difference to the nature of training itself. Much of Japan’s economic success has been widely attributed to a pronounced capacity for taking in ideas or designs, improving them and adapting them to local purposes or even re-exporting them. Time and again, examples are produced of such phenomena in popular accounts of Japan’s success. Echoes of this theme of ‘borrowing’ and ‘adaptation’ can be seen in more scholarly accounts, whether it is

Introduction

7

of Henry Dyer and the Engineering College in the late nineteenth century or phenomena as varied as the writing system introduced from China in the sixth century or cameras from Germany in the twentieth century. However, Japan’s arrival at the leading edge of many technologies has prompted concern about the need to design new institutional patterns which promote more original design and new products in Japan. This theme has been taken up in reform debates at the national and company level. Chapter 4 takes up both these levels of R&D organisation. Recent comparative research has emphasised the importance of setting companies in their national pattern of institutional development through debates about the significance of ‘national system of innovation’. While there has been considerable agreement about the main elements of the ‘Japanese national system of innovation’, there has been controversy about their relative importance historically. There is some agreement that the role of the Ministry of International Trade and Industry (MITI) was critical down to the 1970s, particularly in relation to imported technology from the West, but that it has been undergoing change to a less directive role vis-à-vis companies. If the onus of innovation is to rest with companies, how will companies reshape the role of engineers in innovation? Much of the discussion has focused on MITI and less attention has been given to companies. Survey data on R&D careers reveals the challenges to many taken-for-granted assumptions in human resource management involved in the changing role of company R&D. There is no doubt that Japanese companies have been investing more in the longer-term research component of R&D. Chapter 5 takes the discussion of changing human resource management further with an examination of skill formation. Much of the strength of Japanese engineering education is alleged to stem from the lifetime employment system and the patient building of skills. But is this system appropriate for producing R&D staff? Does the system need further development or change—for example, mid-career recruitment for R&D staff? How do R&D organisations in more external-market oriented systems promote the education and training of R&D staff? Much of the discussion of Japanese R&D deals with companies either as units of analysis or as national aggregates. There is little which tells us about the content of R&D—what scientists and engineers actually do. Still less is there any discussion of the aspirations and experiences of engineers and scientists themselves, or what produces content or discontent. Chapter 6 takes discussion to the heart of professionalism and professional organisation with a close look at the potential for conflict between professional aspirations on work goals, rewards and careers and the potential for collective organisation to ameliorate the lives of R&D workers. While the picture emerging from research agendas on national systems of innovation sets companies firmly in their national context, the activities of companies in foreign direct investment and the debates about ‘globalisation’ direct attention to questions about the ability of engineers to engineer transplants. Chapter 7 asks whether Japanese engineers are limited to simply producing screwdriver plants in overseas locations. Some critics argue that, first, Japanese engineers cannot introduce the important features of Japanese technology and Japanese work organisation elsewhere because these elements are too dependent on Japanese

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Engineers in Japan and Britain

culture and social organisation, and, second, that Japanese companies will have little interest in bringing high value-added work, involving R&D and high skill work, leaving only low value-added, low skill, lowly paid types of employment for the transplants. While it has not been too difficult to establish assembly plants using a good deal of semi-skilled labour, developing the full factory with a sophisticated technological capability, such as R&D or design and development, is a good deal more difficult. This chapter will examine the extent to which Japanese companies in the UK are employing UK engineers and developing the working relations between Japanese and British engineers. Already there are over 200 Japanese companies with manufacturing facilities in the UK and there are over 100 Japanese companies with some R&D facilities. A major motive for comparative research is to know ourselves better, and often to indulge in some self-improvement. Thus constructing a particular image of a foreign land in order to promote some favoured cause at home is one of the pitfalls of international comparison. Chapter 8 summarises what we have learned about engineers through comparative study and the interpretative frameworks in which they have been studied.

1 Historical legacies for engineers

‘Britain created its first modern engineering college in Japan.’ (Henry Dyer, cited in Oshima 1983:20).

Introduction At the beginning of the 1990s, summary comparisons of Japanese and British economic statistics played up the sharp contrasts in the economic fortunes of the two countries since the 1950s. No matter how one looked at the growth of the Japanese economy—whether at the whole economy, the manufacturing sector, the share of manufactures in world trade, the size of banks, or the strength of the yen as an international currency—Japan had made remarkable progress since the 1950s. The figures could still stimulate the admiration of British observers. Despite the more bullish claims about the revival of the economy under the Thatcher governments, there was still a strong preoccupation with long-term economic decline in Britain. Comparisons with Japan over a hundred years of industrialisation provoked even sharper contrasts. So where did the British start to go wrong and where did the Japan start to get it right? It was understandable that questions about economic development were put in these terms, even if they are very contentious. The sense of gloom about Britain’s economic position was often overdrawn (Brown 1998:3). Moreover, the more recent headlines on Japan and protracted recession through much of the 1990s suggest that economic fortunes (or perceptions of them) can change quite quickly in fickle fashion. Yet, despite the many problems in selecting appropriate economic indicators, the crude question provides a convenient starting point for unravelling the picture over the course of the twentieth century. This chapter explores one popular line of answers to the question, namely that the source of Japanese success and British failure lay in the capacity to design and establish viable social institutions which could promote economic development. The processes of institutionalisation, or institution-building, have long attracted social scientists. Although many different institutional areas might be cited, this chapter examines those institutions concerned with the education, training and employment of engineers. There is a strong interest in examining

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Engineers in Japan and Britain

the conditions for the institutionalisation of the science-technology system, that is, processes of innovation in social institutions which not only enhanced the scale and scope of the new science-based technologies, but rapidly diffused their application more effectively through the economy. Freeman has picked out the establishment of the Technische Hochschule in Germany for the education and training of higher-level engineers as one of the two most important institutional innovations paving the way for the modern network of scientific and technological institutions, alongside the development of the inhouse company R&D laboratory in the US (Freeman 1992:170). The comment at the head of the chapter, attributed to Henry Dyer, suggests that Japan began to set out on a virtuous spiral of economic growth in the late nineteenth century with the creation of a modern engineering college, while Britain still was caught in the vicious spiral and failed to develop new institutions. Two broad lines of answer to the question of why institutional developments were promoted or inhibited have lain with the ‘late development effect’ and ‘cultural constraint’. The ‘late development effect’ was coined by Dore (1973) in the context of explaining differences in the institutional structure of employment relations in Britain and Japan, and he suggested that these differences rested on the timing of industrialisation. The ‘late developer’, Japan, established new institutions appropriate for industrialisation on two grounds: ‘modernity factors’ and ‘underdevelopment factors’ (Dore 1990:447). ‘Modernity factors’ implied that Japan could select the latest models for institutional development from the tried and tested models observable in the current advanced nations, while the ‘underdevelopment factors’ suggested that factors in the social structure would mean that Japan had little option to undertake institution-building in the same manner achieved in the pioneer nation because it lacked appropriate elements in its own social structure. Applied to the issue of an advanced engineering college and Dyer, the argument would be that Japan could look across to Europe and select an appropriate model for training high-level engineers (the ‘modernity factor’) and that it was not free to use traditional methods of apprenticeship-training for craftsmen because the teachers would not be able to cope with imported technology from the advanced nations (the ‘underdevelopment factors’). Therefore Japan was able and obliged to deploy the latest techniques of social organisation for the education and training of engineers. The other side of the coin is that Britain had too much invested in existing institutions to set about widespread reform— in essence, the ‘liability of being first’. While this line of explanation emphasises the timing of industrialisation, another line of explanation has emphasised cultural factors, particularly the mix of social attitudes and socially approved conventions on conduct from the pre-industrial era which inhibited Britain’s wholehearted acceptance of industrialisation. In the following sections of this chapter, I will approach the central issue of the significance of institutional innovation in Japan and the more modest adaptation in Britain by outlining some of the questions which emerge on closer examination of the contribution of Henry Dyer and his colleagues to institution-

Historical legacies for engineers

11

building in Japan. Then I will compare developments in the respective patterns of engineering education and training in Japan and Britain in three time periods —the period up to 1914; the inter-war period; and the period from 1946 to the present. While any attempt to chop time into bite-size portions runs the risk of arbitrary decisions, particularly when covering two countries, these periods cover, first, the period of British economic leadership up to the watershed of the First World War and the take-off into industrialisation in Japan; second, the inter-war period of depression, recovery and structural change in Britain and the period of Japan’s initial gains from the dislocation of world trade during the 1914–18 war, followed by Japan’s experience of economic fragility and depression with recovery under the stimulus of militarisation; and, third, the period of mixed fortunes from the end of the Second World War, as both countries enjoyed growing prosperity in absolute terms, albeit at very different rates of growth and with marked changes in respective shares in world trade. So much gloom and despond has covered writing on Britain’s economic performance that ‘relative economic decline’ has often been contracted simply to ‘decline’ and sight lost of the growth enjoyed in absolute terms over the postwar period (Edgerton 1996). Debates on Henry Dyer The story of Henry Dyer’s encounter with Japan has become a popular starting point for British and Japanese writers on the historical development of Japan’s engineering workforce (Lorriman and Kenjo 1994:1). It is certainly an interesting tale in its own right. It has the smack of adventure as the story of a young engineer sought by Japanese emissaries shortly after the Meiji restoration in 1868, and subsequently appointed to establish an engineering college in 1873. Dyer’s own forthright expression and writings give colour to the tale. His account of his experiences, titled Dai Nippon (Great Japan), a play on the idea of the ‘Great Britain of the East’, has a prophetic ring (Dyer 1904). His comment quoted at the beginning of the chapter, has an appealing irony about an apparent case of the British doing for others in the late nineteenth century what they failed to do for themselves. However there is a broader reason, beyond the story’s intrinsic merits, for taking a close interest in the establishment of a new kind of engineering college in nineteenth-century Japan. Although starting out from the Dyer story, I want to emphasise the lengthy and uneven processes of institution building in Japan and to caution against the oversimplifications which can come from encapsulating over a century of comparative economic development in one brief episode and embellishing it with layers of moral certitude about where Japan started to build the institutional framework for subsequent economic success and where Britain failed to perceive or anticipate the needs of modern industrialism. Dyer’s story has been used in some of the big debates on the respective economic histories of Japan and Britain. On the one hand, there are the debates about the explanation for Japan’s ‘economic miracle’, that remarkable economic

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Engineers in Japan and Britain

rise from the ashes of defeat in 1945. Dyer’s comment has its attractions both to those who argue that the roots of post-war success lie in the pre-war periods and to those who emphasise the importance of the ‘late development effect’, where it has been argued that a country setting out late on the path to industrialisation can select judiciously from the experience of the predecessors to shorten the process of trial-and-error learning and to avoid some of their mistakes. In other words, the ‘late developer’ can start industrialisation with ‘state of the art’ technology and might even leapfrog ‘the pioneer’, whether technology is used in its narrow sense (the machinery or ‘hardware’), or in the broader sense (including the ‘software’ of social institutions and techniques of organisation). The establishment of the College of Engineering is often portrayed as an illustration of the learning process in one of its critical phases. By the same token, Dyer’s story has been cited to argue that Britain’s relative economic decline began long ago with a trail of missed opportunities in the late nineteenth century. In a sense, this is to argue the reverse side of the Japanese coin, that Britain suffered the ‘liability of being first’ where Japan had the advantage of being a ‘late developer’. In essence, it has been argued that Britain was either unable or unwilling to reform social institutions formed in earlier times, although there has been argument over whether the constraints should be interpreted either as aspects of a ‘cultural malaise’ or as the product of institutional rigidities. From either perspective, Britain’s economic difficulties in the post-war period can be traced to the governments of Victorian Britain and their alleged failures to oversee the adaptation of British institutions to cope with the requirements of the emerging ‘second industrial revolution’ and to build the institutional framework for continuing economic success. There is a long history of debate about the role of ‘culture’, ‘the state’ and ‘the Victorian businessman’ in explanations of the ‘relative decline of the British economy’, whether that decline was more precipitous than it need have been, and whether the alleged British failure to develop a technical and vocational education system to meet modern industrial needs was a major factor (Child et al 1983; McCormick 1985; Child et al 1986; McCormick 1986b). Britain has been alleged to suffer from a number of constraining cultural influences. Hierarchical conceptions were held to have buttressed retained elitist elements in higher education, for example, by setting limits to the extension of educational opportunity and to the development of non-traditional elements in the curriculum (Banks 1968:38). Similarly, it was held that the remnants of an aristocratic tradition of liberal education impeded but could not block the response of higher education to industrialisation (Clark 1962:57). Renewed interest in cultural impediments to industry, technological education and economic growth was boosted with the publication of Wiener’s highly readable argument that literary intellectuals captured England’s educational system to foster an anti-industrial culture in the formative stages of a national educational system (Wiener 1981). Although Wiener’s discussion of engineers is limited, the general tenor of his argument was supported by Barnett’s critique of an anti-industrial culture thesis (Barnett 1977; Barnett 1986). However, more recent

Historical legacies for engineers

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writing from a variety of historical perspectives from business history to cultural history have severely damaged the Wiener/Barnett thesis as facile ‘in its monocausal simplicity’ (Robbins 1990:21). While the popular rendering of Dyer’s role in Tokyo provides a neat prologue to some big themes, there are two immediate questions prompted by Dyer’s comment about the Tokyo College of Engineering: first, what was meant by a ‘modern college of engineering’, and second, to what extent was it a ‘British creation’. Here we run into contentious matters. Some see Dyer taking a British interpretation of the German Technische Hochshule into Japan, whereas others argue that there is no evidence for such a claim. Although important, some argue that the focus on Dyer and his British colleagues is to miss the eclectic nature of Japan’s borrowing and the shrewd learning by the Japanese hosts. Moreover, putting the stress on the Meiji period can result in a distorted reading of the historical legacies for today’s engineers, one in which much of the subsequent history is air-brushed out of the picture. The post-war occupation reforms were important in giving greater scope for engineers to influence the development of the mass-production industries which have been at the forefront of Japan’s industrial success. In other words, I shall argue that the seeds of the College of Engineering legacies only fully ripened with the post-war reforms when Japanese engineers entered the shop-floor areas of the mass-production industries in a changed relationship with blue-collar labour. Developments before 1914 Although the bases of laissez faire policies were crumbling for Britain by the 1860s and 1870s, business opinion and government policy adjusted slowly. The main tasks of government remained to set the scene for entrepreneurial talent to flourish. Therefore the late Victorian state was ‘a regulatory state’, but one still committed to minimal regulation; it was little involved with the direction of business enterprise or the production of engineering manpower. By contrast the central task of the Meiji modernisers was to transform a peasant economy into a modern economy with the technological capacity to stem any western political threat. Thus the Meiji state took the lead in industrialisation to introduce technologies from the West, to provide examples in model factories, and to direct the educational system to national purpose. Meiji Japan created a Ministry of Education in 1872 and Japanese enrolments in primary and tertiary education matched those in Britain by 1910 (Dore 1976:35–6). Although around the turn of the century some British engineers advocated reform of British engineering education along continental European lines, Britain continued to put much reliance on informal methods to produce even high-level engineers. This meant, for example, the assignment of a young school-leaver as an apprentice to a professional or senior engineer to receive a mix of on-the-job experience and off-the-job instruction and become recognised as a ‘professional engineer’ by becoming a member of a professional institution, often by taking examinations. Although there were changes in the nature of

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Engineers in Japan and Britain

instruction, with an increasing amount being provided through part-time education, often evening classes, the part-time route of part-time evening or day-release education mixed with employment remained the main route to professional standing for British engineers through much of the early twentieth century. The full-time route through university or college followed by employment and training did not draw level in providing new entrants until the 1960s. Now well over 90 percent of new engineers come through the full-time route and the part-time route has been virtually closed. By contrast, Japan was putting an emphasis on university-level education for the high-level engineers in the nineteenth century. The first ‘chair’ in electrical engineering in the world could be claimed to have been established in Tokyo, and the laboratory furnished for its first incumbent, the Englishman, Ayrton, attracted much international admiration (Checkland 1989:85). During the late nineteenth century British engineers were very much aware of the development of a more theoretical and scientific engineering and the educational developments in Germany. In the early 1900s, a debate broke out within the professional institutions which threatened the status quo of a division of labour which left universities and colleges responsible for an education in engineering principles and industry responsible for training with both elements overseen by the professional institutions. Yet, the offers of the ‘educationists’ to provide a complete professional education within the universities, were outvoted by the ‘practitioners’, who insisted on the retention of pupilage and apprenticeship as the means of providing practical training—and maintaining a source of income for themselves (Watson 1976). Thus universities settled into a pattern where the curriculum was organised around a relatively specialised three-year degree course based in departments organised around a discipline such as civil, electrical or mechanical engineering. Once this settlement had been established Divall notes that there was relatively little change in the structure of the curriculum at either Manchester University or Technical College between 1905–39 (Divall 1987). Dyer’s position, as the first Principal of the College of Engineering (Kobu Daigakko), owed much to the priority which the Meiji government put upon technology in the drive for modernisation and acquiring the technological means to avoid Western colonisation (Dyer 1904).1 Aged just 25 and paid a salary 20 percent higher than that of a contemporary Japanese cabinet minister, Dyer has been seen as doing for Tokyo what he could not do for Glasgow (Tsuru 1983). With import levies limited to no more than 5 percent ad valorem under the Unequal Treaties imposed on Japan by the Western powers and a government fearful of the entanglements of foreign loans, the surplus for modernisation was essentially squeezed from peasant agriculture. Despite these meagre resources and the financial pressures generated by coping with internal rebellions and threats from external Russian incursion into the northern island of Hokkaido, the Meiji government initially spent almost 40 percent of its total budget on salary payments to foreign experts in 1868–72, dropping to 2.42 percent in 1873–77, and 1.2 percent in 1878–82 (Inoue 1984). Engineers formed

Historical legacies for engineers

15

the largest group of foreign experts, and among them British engineers were prominent with responsibilities to give ‘on-the-job’ training to Japanese craftsmen assigned to them. The costs of the ‘hired foreigners’ prompted other programmes including sending students abroad and determined efforts to grow home talent to replace foreign experts with Japanese engineers. ‘Modern’ in Dyer’s comment is open to variety of interpretations. In the ultimate irony, Japan was importing the Technische Hochschule via Scotland— that is, the ‘continental European’ style of engineering college was being developed in late nineteenth-century Japan, in order to introduce formal methods of teaching and research in engineering higher education and to provide the bulk of the new supply of high-level engineers. However, Morikawa, author of one of the central histories of engineers in Japan, protests that there is no evidence to support tracing Dyer’s ideas to either Glasgow or Zurich (Morikawa 1991:146). The more common view is that Dyer was attempting a hybrid institution, ‘combining the best in British and continental systems’ (Fox 1969: 464). For this view there is a strong body of circumstantial evidence. Dyer put stress on the blend of ideas on which he drew, declaring that he made a special study of all the chief methods of scientific and engineering study in the different countries of world and of the organisation of some of the most important institutions, with the intention of devoting myself to the advancement of engineering education, so that I had fairly definite ideas both as to what was desirable and what was feasible. (Dyer 1904:2) In a careful commentary on the influences on Dyer, including his apprenticeship prior to undergraduate study at Glasgow University, Brock notes that Dyer had access to the syllabus of Zurich Polytechnic from either John Scott Russell, the engineer and naval architect, or from the 1870 Report of the Institute of Civil Engineers (Brock 1981:232). Using Japanese sources, the archives of the College of Engineering, Nakayama traced an even more direct link between Dyer, Zurich and Tokyo (Nakayama 1965:345).2 On balance, there seem reasonable grounds for thinking that Dyer was trying to adapt a blend of British emphasis on practical training and the emerging continental European emphasis on theoretical understanding in the new college. However, it would be unwise to neglect either the influence of his Japanese hosts or the Japanese context. Much attention has focused on the College six-year curriculum (based on two years in academic classes, two years of half-time study and half-time practical and two years at a work-site) and the comment of Dyer that in the newly industrialising Japan the Japanese engineer would find himself alone in the workplace and need to be self-sufficient. However, Morikawa gives credit for the curriculum initiative to Yamao, noting both Yamao’s own experience and the Ministry of Public Works’ (Kobusho) 1871 plans for a college which included practical training at the worksite, but acknowledging that the eventual

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Engineers in Japan and Britain

programme was agreed with Dyer and his British colleagues (Morikawa 1991: 140). Yamao Yozo, who was appointed Vice-Minister of Public Works in 1872 and host on Dyer’s arrival as Principal at the Ministry’s new college in 1873, had been one of the five Choshu samurai officials who had been chosen to visit England in 1863, still in the Edo era and before all the drive for industrialisation launched with the Meiji Restoration. This select band included Ito Hirobumi (later Prime Minister in Meiji), Inoue Kaoru (later Finance Minister), Inoue Masaru (later Railway Minister), and Ito Kinsuki (later Director of the Mint) (Morikawa 1991). During his visit, Yamao worked as an apprentice in the Napier shipyard and studied in the evenings at Anderson College in Glasgow. Thus Morikawa credits Yamao with much of the responsibility for recognising the importance of engineering practice in the curriculum and a shared outlook with Dyer. Dyer acknowledged the importance of Yamao in securing the development of the College, noting that he had been aware of him at Anderson’s College in Glasgow, although they had not met when they were both students there (Dyer 1904:2–3). Wherever we put the emphasis for the curriculum initiative, the link with the Ministry of Public Works meant that there was little difficulty in securing training placements in the governmentsponsored industries. The early students at the College of Engineering came from the former samurai class, often sons of military officers or government officials, who had received the classical education for the samurai class. This background provided some tensions as they met their Western tutors in English-language teaching on engineering. However, their tutors were well-pleased with the diligence and eagerness for learning evident among students (Checkland 1989:86–90). Just as Yamao had studied overseas, other Japanese engineers studied in Europe and the US and became important in the eventual replacement of the expensive expatriate engineering teachers. Graduates of the College of Engineering became important in Japan’s industrialisation. For example, Hunter traces the career of one example, Kikuchi Kyozo, who used a wealthy family background to finance his study at the College and then enter the textile industry (Hunter 1991:140–5). In early Meiji Japan there were two strands to the training of high-level engineers through formal education. One route lay through Dyer’s College of Engineering, administered under the Ministry of Public Works, and the other lay through the Faculty of Science of the University of Tokyo, which had been under the control of the Ministry of Education since 1877. Eventually these two institutions became respectively the Faculties of Technology and of Science when the new Imperial University of Tokyo was created in 1886 out of the amalgamation of several institutions, and the responsibilities of the Ministry of Public Works were shared between several ministries. The changeover brought curriculum changes as the new Imperial University shortened the engineering course from the College’s six years to three years (with three years now assigned to the high-school stage and three years to university-level studies) and the two years of practical training were shortened. This reduction of the

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practical element reflected some feeling that students had been overemphasising practical matters and a desire to bolster their mathematics skills to match students in the Science Faculty. Behind these educational changes lay some deeper influences which reflected the different factions making up the Meiji leadership and the wider international links and sympathies of those factions. While the Ministry of Public Works and the Engineering College reflected the sympathies and links of the Choshu faction of the Meiji government with Britain, other factions had different orientations and connections. The Science Faculty in Tokyo University had reflected other links with a larger proportion of German teachers and a greater emphasis on theory in teaching. In the new Imperial University, these influences were brought together in a new synthesis. For a decade, Tokyo had a monopoly of the supply of engineering graduates (indeed of all graduates) until the second Imperial University was created in Kyoto (in 1896), stimulated in part by the Sino-Japanese War of 1894–95. By 1900 over 1,000 engineers had graduated from the Tokyo Imperial University, with a similar number from the other higher technological institutions (UNESCO 1971). Further Imperial Universities were established—Tohoku (in Sendai in 1907), Kyushu (in Fukuoka in 1910), and Hokkaido (in Sapporo in 1910). Meanwhile private universities and schools had been started by intellectuals and figures associated with political opposition: for example, Keio and Waseda Universities. Although the Government would not employ private university graduates initially, employment opportunities grew with the gathering pace of industrialisation after the mid-1880s. Of the 20 higher education institutions in 1914 (universities, higher technical and higher commercial schools), 11 were regular suppliers to industry and these included the four prominent institutions—the Imperial University (later Tokyo University), Keio University, Tokyo Higher Commercial School (later Hitotsubashi University), and Tokyo Technical School (later Tokyo Institute of Technology) (Yonekawa 1984:194). The shift in initiative to private industry in industrialisation and the significance of industrial employment in stimulating engineering education can be seen in the changing proportion of technology graduates in industrial employment. In 1883 only 3.5 percent of the technology graduates of the forerunner of the Tokyo Imperial University entered employment in private industry compared with 42.9 percent by 1900 (UNESCO 1971:128). Ingenious inventors were an important source of engineering skill in industrialising Japan (Takeuchi 1985). Odagiri and Goto point to the importance of adaptations in indigenous technology and the contributions of the master craftsmen skilled in mechanisms (karakuri), who could turn their hands to steam engines, electrical equipment and looms and other aspects of Western technology (Odagiri and Goto 1996:14–15). Although Japan did not have many scientists, an understanding of scientific developments in the West had been possible even in the relatively closed world of the late eighteenth-century Edo period via China, and then through translations from Dutch learning (Rangaku), particularly as Rangaku spread beyond Nagasaki to provide an important nationwide cultural resource and precondition for development which marked

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Japan out from other late developer societies. For Lehmann, the existence of a network of Rangaku-sha (students of Dutch learning) across Japan was an important factor in the rapid speed with which Japan could assimilate science and technology from the advanced countries of the West (Lehmann 1982:128). For the take-off into sustainable economic development it was important to build on the proto-industrialism of karakuri and the scientific intellectuals with the graduates from more formal courses from the Kobu Daigakko (and later the Imperial University)—and the graduates needed employment opportunities. While many of the early jobs were found in government posts, the private sector opportunities began to emerge, particularly after the successful war against China in 1895. One of the more significant promotional efforts for private-sector development was that of the joint-stock company system (Nakagawa 1977). In a span of 40 years after its introduction the joint-stock company system had penetrated all the main sectors of the Japanese economy at a much faster rate than that achieved in England (Nakagawa 1977:21). One factor in this rapid diffusion was the close association between the introduction of the newest Western industrial technology with the newest social technology of business organisation. Nakagawa cites a further factor in the preferences of the educated sons of ex-samurai for employment in joint-stock enterprises rather than traditional family businesses (Nakagawa 1977:22). At this stage, the role of engineers was still ill-defined, and as Hunter noted in her essay on Kikuchi Kyozo (1859–1942), they tended to be ‘hired as independent professionals rather than “company men”’ (Hunter 1991:146). The entry of the graduate engineers into management was not smooth, and they sometimes faced hostility from owners because they lacked capital and from workers because they were relatively highly paid (Hunter 1991:142–3). Large joint-stock enterprises became prominent in the growth of the cotton industry in the late 1890s, but these companies remained single-product and single-function enterprises for they were dependent on the general trading companies (sogo shosa) for their marketing functions. While the trading companies focused on the creation of a world-wide efficient marketing system and the development of links with highquality supplier companies, the industrial companies concentrated on production. Management in the industrial companies became the management of the (imported) technology rather than the management of marketing or finance (Iwata 1977; Yonekawa 1984). The Osaka Boseki-sho Kabushi Kaisha (Osaka Cotton Textile Company Limited) was one of the leading joint-stock companies and provided a model for the ascent of an engineer to become President in 1897. Yamanobe Takeo had entered London University to study economics and insurance. However, when the eminent businessman, Shibusawa Eiichi, invited him to join his cotton textile project, Yamanobe moved first to King’s College to study mechanical engineering and then to a Lancashire cotton mill as an apprentice in 1878 (Yasumura 1993: 91). Within the Osaka company, Yamanobe gradually assumed managerial control because the senior directors were businessmen untutored in plant operations. By 1897, Yamanobe had become a stock holder. After a boardroom battle over dividend policy, in which

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he championed higher plant investment at the expense of dividends, Yamanobe became President (Yasumuro 1993:94). In surveying the development of higher technical professions in Japan, Levine and Kawada stressed two features: firstly, that up to the end of the nineteenth century the numbers of engineers and scientists per 10,000 population were quite small by comparison with more advanced nations, but secondly, that the proportion of the educational elite trained in science and engineering was very high—for example over 50 percent of Japanese graduates graduated in science and engineering in the late nineteenth century (Levine and Kawada 1980). However, care is needed in thinking about engineering education as a route to elite positions. By taking matched pairs of the careers of engineers and business managers across different generations in Mitsubishi Zaibatsu, Morikawa demonstrated that the economics or law graduates who entered business careers rose faster and further in salary than their counterparts in engineering (Morikawa 1975:56). Table 1.1 shows that among the 1886 entrants, Mimura (a business graduate in the banking division) started ahead of Nakamura (an engineer in the mining division) and was well ahead by 1909. Although the differentials were not so marked, similar patterns emerged in the later entry cohorts (1892, 1894 and 1905). Thus, although engineers were important and accorded prestige, those commentators who painted pictures of engineers enjoying accelerated career paths to the top, ahead of law or economic graduates, run ahead of the available evidence. In Japan, engineers could be defined in terms of either the education which they received or the work that they performed. In Britain, this picture has been further complicated by a third definition in terms of their membership of one of the professional engineering associations. British engineering education qualifications have been indicators only of a readiness to practice; recognition of professional competence has been given through membership of a professional institution. In the absence of state sponsorship for engineering qualifications, the British professional institutions in engineering have served as both ‘study associations’ and ‘qualifying bodies’ (Millerson 1964). A British education ministry was not created until 1899 and its remit did not include universities, since the ad hoc grants in aid of British universities had already started to be routed through the Treasury and the Treasury Grants Committee. Although for a brief period the buffer body reported to the Board of Education, when government support for universities was regularised in 1918 the University Grants Committee reported to the Treasury rather than the Board of Education. Membership of a professional institution could be gained either through an ‘academic route’ (typically a university degree plus approved training in employment plus a period of responsible professional practice) or through a ‘practical route’ (combining part-time education, employment and professional institution examinations). These possibilities have resulted in a much more heterogeneous variety among British engineers compared to their counterparts in other countries. The history of British engineering education has been the story of the extension of full-time degree-level education in universities and

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Table 1.1 A. comparison of the careers and salaries of engineering and business graduates in Mitsubishi Zaibatsu (1886–1916) (yen)

1 Kimura was an economics graduate from the Law Department of the Tokyo Imperial University and employed in the General Affairs department of the Mining Division. Source: Morikawa 1975:56

technical colleges from its very narrow and exclusive nineteenth-century base: for example, in 1945 only 35 percent of engineers came through the academic route, compared to 50 percent in the mid-1960s and over 90 percent in the 1980s. Presently between a half and two thirds of engineering graduates join their relevant professional institution, and professional institutions are steadily becoming all-graduate organisations through their new members, yet there have been long-standing arguments about the efficacy of the relations between

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universities and colleges, professional institutions and employers in securing high levels of competence among British engineers. Buchanan has complained that the critics have underestimated the value of the ‘practical route’ and have been too much impressed by contintental European developments, although he conceded that the proliferation of the institutions and their disputes inhibited the presentation of a coherent voice for engineers (Buchanan 1985a). By 1910 Japan was hardly ‘modern’ or ‘industrial’: agricultural labour constituted almost 60 percent of the labour force, agricultural output made up 40 percent and manufacturing less than 10 percent of net national product (Rosovsky 1972:230). Male factory workers did not outnumber female factory workers until the 1920s, reflecting the character of rural industrialisation in small workshops (Allen 1981:252). Yet Japan was attempting to adapt traditional social hierarchies to modern purpose. The early managers tended to be lower samurai who had lost their stipends but gained a little technological knowledge (Sumiya 1974:30). Often they made mistakes and the heavily bureaucratic structure of the government ‘model factories’ was a hindrance. Yet after the financial crises of 1881 and the sale of the model factories the way was clear in the 1880s and 1890s for the recruitment of graduates in engineering, commerce and social studies for management posts. Graduates from the Kobu Daigakko were prominent among the new engineering entrepreneurs and managers in the nascent industrialism (Odagiri and Goto 1996: 260). In 1914, Britain remained one of the three largest industrial and manufacturing nations in the world. It is true that the 1914–18 war severely disrupted Britain’s trade and the staple industries but the products of Britain’s informal system of producing engineers were still capable of many notable achievements and their technology bore the brunt of a gruelling war. The cliometricians exonerated Britain’s late Victorian entrepreneurs for succumbing to the problems presented by deteriorating factor costs compared to rivals and to the tariff barriers erected by rivals, and for moving from a ‘number one’ to ‘number three’ economy, on the grounds that responding to given conditions is all that may be legitimately asked of entrepreneurs (McCloskey & Sandberg 1971; Temin 1966). On the grounds that a legitimate expectation of entrepreneurs is that they should ‘confront institutional constraints innovatively’, however, Elbaum and Lazonick find fault with the nineteenthcentury British businessman (Elbaum & Lazonick 1986). In particular, they argue that British businessmen became trapped in a matrix of ‘rigid institutional structures that obstructed individualistic as well as collective efforts at renovation in industrial relations, enterprise and market organisation, education, finance, international trade, and state-enterprise relations’ (Elbaum & Lazonick 1986:2). The solution which the British businessmen failed to see and secure was to replace the atomistic, competitive organisation of British industry with a Chandlerian allocative mechanism based on a corporate, concentrated managerial structure. Whether or not a more rapid development of managerial hierarchies could have staved off relative economic decline, there are examples of vicious circles hampering developments in the new more science-based

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industries of the second industrial revolution. Britain had been a leading centre in the emerging electrical industry, but began to lag in technological innovation. Despite initial delays caused by legal tangles and the relatively strong competitive position of the gas industry vis-à-vis electricity compared to other countries, Britain was technologically well placed in the 1880s. Yet companies relied on the market and consulting engineers rather than in-house engineers for design. The manufacturing companies began to lose their competitive edge during the 1890s, and in the bitter internal squabbles within companies the engineers lost out to the businessmen (Sakamoto 1980). The effects did not go unnoticed in Japan. In the 1870s, the Japanese government had recruited British engineers, craftsmen and machinery operators to superintend the first telegraph lines and early telecommunications industry (Levine & Kawada 1980:268–71). By the 1880s, the pattern was changing as an indigenous capability was being established and Japanese teachers were replacing the expensive British teachers. Furthermore Japan was now sending Japanese abroad for training and had sent electrical machinery engineers to Britain for training and attachment to British companies (Checkland 1989:134–47). By the 1890s, the pattern was changing again for now they were being attached to the new progressive companies in the electrical industries in the US and Germany instead of Britain, and these countries were replacing Britain as the primary sources of electrical goods imported into Japan (Uchida 1980:158–60; Imazu 1980:135–7). The inter-war years By 1914, Japan had renegotiated the irksome ‘unequal treaties’, was becoming an imperial power, and had developed the distinctive characteristics of ‘industrial dualism’ with some large modern establishments in a few industries and a vast penumbra of small to tiny firms and traditional technology in others (Broadbridge 1966). The textile trades were the meeting point of the ‘traditional peasant economy and the new capitalistic economy’, for after the sale of ‘model factories’ most of the initiative came from private entrepreneurship in cotton, silk and other textiles (Allen 1981:80). In the heavy industries, government stimulus and support remained critical, for as Allen observed: ‘political necessity rather than economic advantage supplied the impulse’ (Allen 1981:82). Expansionist policies in financing military ambition, territorial acquisition and investment, and the industrial base were straining national finances however. While Japan had seen economic progress since the 1870s, its financial position was still precarious. Development had brought imports and the trade balance was often in the red up to 1914. The outbreak of the 1914–18 war in the West provided an unexpected bonus with a large boost in demand for Japanese munitions and the opportunities to penetrate foreign markets deprived of their usual suppliers. This respite was temporary for as competitors began to establish themselves in the 1920s the weaknesses became apparent again. In this setting American economists advised that Japan should

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abandon any ambition to be the ‘Britain of the East’ and concentrate on ‘village industry’ (Scott et al 1980: 61–8). Instead, the military ambition prevailed and Japan sought to extend its economic base through further imperial acquisition. With direct and indirect support the zaibatsu extended their dominance of the major industrial enterprises. In the 1920s, they extended their recruitment of graduates for managerial careers, built on intra-firm skill training and developed those measures to encourage employee loyalty—long-term employment, seniority wages and enterprise unionism—which have come to be termed the ‘Japanese employment system’ in the post-war period (Okayama 1983). Although the zaibatsu were based on family interests, were organised around the ‘ie’ (household principle), and fostered a paternalistic management style, they were not run as directly controlled family businesses because executive activities were devolved to university graduates recruited for professional management. Morikawa, tracing the gradual acquisition of decision-making powers by salaried managers, pointed to variations across zaibatsu—for example, Mitsui with interests in copper recruited more engineers than Mitsubishi (Morikawa 1989). Meanwhile the technological levels in cotton textiles and in the zaibatsu-controlled companies were changing from the 1920s to the 1930s such that Chokki can depict the passage of an era from that of the ‘old engineer’ without formal technological education to that of the ‘new engineer’ graduated from the university (Chokki 1977:173–4). On the education front, the first four decades of the twentieth century were largely occupied by a filling out of the pattern laid down in the 1891 Imperial Rescript on Education. Beneath the Imperial Universities were the private universities and a variety of other institutions. The private universities even enjoyed some official encouragement and reorganisation after the First World War had stimulated the Japanese economy. In an educational pattern of six years’ elementary school, five years of middle school, three years of high school, and possibly three years of university (i.e. 6–5–3–3), there was a complex multi-track system. After the six years of compulsory and co-educational elementary schooling, the tracks became highly differentiated between boys and girls, and then further between the tracks for those leaving at the end of middle school, those going further on vocational tracks and those entering the academic tracks. In total, there were five recognised tracks for boys and three tracks for girls. The route to university for boys lay along an academic track through middle and high school, but with university provision well below levels of demand there was fierce competition, often termed ‘examination hell’ (shiken jigoku) (Passin 1965). For those who failed the academic route a variety of colleges (senmon gakko) or higher technical schools (koto senmon gakko) could lead to qualification as a doctor, dentist, architect or engineer at a lower professional level than the university. In the next main phase in the development of the education system (1936– 45), nationalism, militarism and wartime mobilisation gave a renewed vigour to the development of engineering education. Since the cohorts who entered advanced engineering education in this period were arriving at responsible

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positions in the 1950s–60s, the years of the nationalist education system must be given some due recognition for creating the springboard of human resources from which Japan could launch the dramatic recovery of the post-war period. In both absolute numbers and relative proportions the contrasts between engineering education in 1931–35 and 1940–45 were dramatic. The educational expansion of the ‘Taisho era’ (a period of more experimenting in liberal democracy under Emperor Taisho and sometimes termed the ‘Taisho democracy’) had been led mainly by law and liberal arts students, so that the 30,000 science and engineering graduates over the period 1931–35 accounted for only 15 percent of all graduates. By contrast, after mobilisation for an anticipated war with Russia in 1937 and the outbreak of real wars with China in 1937 and the US in 1941, the 100,000 science and engineering graduates from 1940–45 accounted for 23 percent of all graduates in those years (Aso and Amano 1972: 53). The extent to which the inter-war years represented another era of lost opportunity in Britain remains a matter of contention among business historians. Chandler suggests that the multi-divisional firm did not emerge in Britain until the 1950s (Chandler 1984). Hannah, on the other hand, suggests that many of the characteristics of that form of organisation for large-scale firms were already becoming evident in the 1930s (Hannah 1980). Although Chandler cited a range of obstacles (including Britain’s educational system and its industrial geography and history), he gave prominence to two factors—the lack of anti-trust legislation and the continuing commitment to family-controlled business. For example, he noted that even ‘holding companies’, born out of mergers, tended to be organised as federations of family firms (Chandler 1984:495–8). However, as Hannah observed, proof of family connection is not necessarily proof of family dominance in direction and management (Hannah 1980:53). Pending more case studies the picture appears mixed and generalisation tentative. Although Payne saw evidence of British companies grappling with managerial innovation and the problems of large-scale innovation in the growing numbers of ‘accountants, lawyers and technicians in the boardroom’, in commenting on entrepreneurial performance in the inter-war period he noted increasing lags behind the major international competitors in the adoption of new technology and he identified a major restraint in ‘the paucity of technical expertise in the boardroom’ (Payne 1978:213, 217). International comparisons show how the emergence of the large-scale enterprises sent different signals to the educational system in different countries. Where American large-scale enterprises were evident in all sectors of the economy, the British large-scale companies tended to be disproportionately in the consumer sector whereas the Japanese tended to be in the production sector (Chandler 1984:479). At the beginning of the twentieth century, Oxford and Cambridge had been joined by London University, a federal institution composed of London colleges, and several civic universities which had been colleges in the major provincial cities. Unlike the German universities these English universities had not prevented the entry of engineering as a course for university study in the

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nineteenth century (Ashby 1958; Armytage 1955; Sanderson 1972). Therefore England did not develop alternative institutions in the manner of the German Technische Hochschulen, but university studies in engineering made slow progress—for example the total enrolment in science and technology of 13,000 in 1938–39 was only 7 percent higher than in 1920 (Poole & Andrews 1972: 258). The annual output of 5,000 scientists and technologists was approximately evenly divided between scientists and technologists. Yet the engineers were remarkably concentrated even in the 1940s. While 10 universities and two university colleges provided degree courses in engineering, over 50 percent of the university graduates came from Cambridge University and the Imperial College of Science and Technology, a constituent college of London University. In other words, the majority of engineers who came through the ‘academic route’ did so through highly prestigious segments of the university system. However, the bulk of the new supply of engineers continued to come through the ‘practical route’ rather the ‘academic route’. The Technische Hochschule theme was sometimes taken up by champions of the technical colleges when they tried to promote their cause vis-à-vis universities. The central differences between universities and technical colleges lay in the forms of government, sources of finance, and the title of final qualifications. Universities were formally independent institutions with their governance based on their Royal Charters or Act of Parliament, receiving their income from fees, endowments, and grants in aid from central government. Technical colleges were largely managed and financed by local authorities under regulations drafted by the central government’s Board of Education. Where the universities had powers to grant degrees, graduates on advanced engineering courses in technical colleges took national certificates or diplomas on syllabi devised by the colleges, the boards and the professional institutions. These broad distinctions between the two routes to professional engineering were blurred in practice however. Such areas of overlap fanned the aspirations of technical colleges for the greater autonomy, prestige, and powers of universities and have provided a dynamic to debates in educational policy for over 40 years (McCormick 1986a). For the technical college lobby a central failure of national technology strategy was the reluctance of central government to promote technical colleges to a parity of prestige with the universities, as the German state did for Technische Hochschulen when they were given degree-granting powers at the end of the nineteenth century. After 1945 In view of the more recent history of American trade friction with Japan, the early post-war years provided some ironic twists. On the day that war ended with Japan’s unconditional surrender, the United States announced the end of the ‘lend-lease’ arrangement with Britain. In preparation for business as usual in the aftermath of year, Britain and its Empire was regarded within the United States as the main commercial rival. However jubilant about the ultimate military

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victory of the Allies, the British were nearer to economic exhaustion. Within five years, the intervention of the Western powers in the Korean peninsula under the United Nations flag meant that Britain was called upon to halt the transition to a peacetime economy and re-arm, knocking the Labour government and its economic plans off course. While British hopes that the United States would help fund some of the re-armament costs were dashed, the Japanese economy was rescued from a parlous state by US military procurement for the Korean War, and Japan became the ultimate beneficiary of that conflict. By 1945, the Japanese economy was in ruins. Now shorn of empire, it had a further six million repatriate mouths to feed. The defeat was a profound shock to Japanese society. While Japanese industry could be proud of the technological journey made in such a short time (for example, in its brief history the aircraft industry had developed the Zero fighter as a formidable fighter aircraft), by the end of the war, it was clear that there was a ‘technology gap’, and one which widened during the course of the war. The Americans and the British had been able to make significant increases in the power of their aircraft, whereas the Japanese had not. Moreover, Japanese industry had not been able to achieve consistency in quality and reliability compared to their opponents (Odagiri and Goto 1996). The arrival of the Allied occupation ushered in a determined effort to reshape Japanese institutions into the American mould of democracy involving reforms in the constitution and political institutions, land reform, business organisation, industrial relations, and education—providing a major stimulus and wherewithal for technology transfer. The negotiation of reform was in some senses more complex and other senses more simple than that in occupied Germany. On the one hand, it was complex process since the Japanese administration was kept relatively intact and reforms were negotiated with and through it, whereas the administration had collapsed in Germany. On the other hand, reform was largely directed by the American Supreme Commander Allied Powers (SCAP), and not the political football of four allies as in Germany. Relations between the occupying forces and the Japanese administration were much influenced by changing perceptions of developments in the ‘Cold War’. The outbreak of the Korean war with the boost of ‘special procurements’ coupled with rising exports to south east Asia from 1950 were very important factors in boosting industrial production up to pre-war levels. However, the stimulus was not just in volume terms, since Japanese industry had to improve standards to meet American military procurement requirements. By 1952, independence had been granted and the Japanese administration had more freedom to shape its own economic and industrial policy. Instead of continuing the logic of comparative advantage in ‘low quality textiles’ and ‘gadgetry’ based on abundant supplies of cheap labour, the Ministry of International Trade and Industry (MITI) determined that Japan needed capital and technology intensive industries if it was to raise living standards for a population of 85 million people on a limited land space with few natural resources (Scott et al 1980). In the 1950s, most of these industries—steel, automobiles, petrochemicals, industrial machinery, electronics—were under

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protection as ‘infant industries’ but emerged as vigorous competitors for their share of growing world markets in the 1960s. The growth of Japan’s domestic market after the Korean war boost meant that advantage could be taken of massed production and increased mechanisation. The astute adaptation of Western technology and production methods in Japanese industry developed apace under the watchful eye and ‘administrative guidance’ of MITI (Johnson 1982). The enthusiasm in Japan for American production engineers who appeared to be lost prophets in their own country has become the stuff of legend (Schonberger 1982; Halberstam 1986). The company groupings based around the reconstituted zaibatsu remained a significant element in the export efforts of Japanese companies given the elaborate communication networks for co-ordinating intelligence, marketing and distribution in the trading companies. However with the increased importance of product-specific skills, services and facilities associated with high-technology industries and growing markets, the manufacturers of automobiles and electrical goods began to develop extensive marketing operations and the more extensive managerial hierarchies of managerial capitalism (Chandler 1984:502). In turn, the growth of these companies in the 1960s stimulated the further expansion of engineering education in the universities and colleges in order to supply the managerial cadre of the companies. During the 1950s and 1960s, the Japanese companies in steel, autos and electrical goods reaped the benefits of mass production through policies of technology licensing, reverse engineering and continuous product and process engineering (Hull, Hage & Azumi 1984). The success of the innovation-based strategies rested on the ability of the companies to recruit employees with the general knowledge and learning skills to cope with changing technologies and tasks, on their ability to combine them in systems of work organisation which maximised productivity gains and flexibility, and on their ability to develop systems of developing necessary knowledge and skills through the employees’ working careers (Wersky 1987). Aoki has emphasised the importance of horizontal communication flows in the Japanese work organisation: …the developing Japanese system is the one which relies more on semiautonomous problem-solving capability (information processing capacity) of workers, thus making the intra-firm demarcation between control and operating tasks rather ambiguous. In contrast, the prevalent Western system seems to aim at the pursuit of economic efficiencies realisable through professional control and operational tasks. (Aoki 1988:4) This system of work organisation rested on aspects of the ‘Japanese Employment System’ in the large corporations, including long-term employment for regular workers, rotation and a commitment to systematic ‘learning by doing’ by employees who have high standards of formal schooling. In addition it depended

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on a high concentrations of engineers in the production areas with relatively low social distance between the engineers and blue-collar operators (Okuda 1983). Where Meiji Japan had been remarkable for the creation of a small technologically-literate educational elite, occupied Japan began the transition from an elite to a mass higher-education system in which engineering education retained a prominent part. By 1945 education had virtually ceased under the twin impacts of the mobilisation of students and allied bombing. The reconstructed system managed to combine the US occupation aims of democratisation through widening access to education with a continuation of the fierce competition of a certification system. The main aim of university reform was to reduce the sharp differentiation of the pre-war system and this was attempted by regrouping institutions into two types—the four-year universities and the two-year junior colleges from 1949. Major distinctions remained through the 1980s however—for example 80 percent of the students in 4 year universities were male while 90 percent of the students in two-year junior colleges are female. Although the ratio of female students in higher education has reached parity with males across higher education in the 1990s, males remain in the majority in the four-year universities. Within the university system, there are national universities (which include the former Imperial universities and the universities of the 47 prefectures), the public universities (financed by municipal authorities), and the private universities. Most of the growth in university and student numbers in the post-war period occurred in the private sector. The total number of universities more than doubled from 199 in 1950 to 446 in 1980, but there was only a 33 percent increase in the number of national universities compared to the 207 percent increase in the number of private universities. There was a sixfold increase in engineering student numbers from 1949 to 1982. The government’s income doubling plan of 1960 stimulated the most significant leap in the early 1960s with a near doubling of the new intake from 26,000 in 1960 to 50,000 in 1965. The strong emphasis given to engineering studies in the Imperial universities of Meiji Japan has had a continuing legacy in the relatively greater commitment to engineering studies in the national universities. Not all of the 461 four-year universities in the 1980s had engineering faculties, yet they existed in well over half of the national universities compared to only 11 percent in the smaller public universities and less than 20 percent in the private universities. This pattern was confirmed by student numbers—in 1984 the 3,375 new entrants to engineering faculties represented only 18.0 percent of all new entrants to private universities, compared to 24,494 new engineers or 28.3 percent of all new enrolments in the national universities. Given that only 55 percent of the national universities had engineering faculties, it seemed likely that engineering students made up over 30 percent of student numbers in those universities. The example of 38.4 percent at Tohoku University supported the view that in Britain these former Imperial Universities might well be called ‘technological universities’.

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The hierarchy of academic prestige in Japanese higher education has its origins in Meiji Japan and was evident in the competition for university entry in the 1920s and 1930s. Amano classified universities based on degree-granting powers (from doctoral level to bachelor-degree only universities) and date of establishment (Amano 1984). This hierarchy of prestige based on academic powers correlates well with the average age of the institutions and with the more familiar classification into national, public and private universities; the more prestigious universities tended to have earlier foundations and national universities tend to figure disproportionately among the more prestigious institutions. There is a clear association of prestigious institutions with engineering studies. Against the national average of 28.4 percent of undergraduate enrolments in engineering and science, the ‘research universities’ had 35.6 percent of their undergraduates in engineering and science and the ‘bachelor-only universities’ only 22.1 percent. At the postgraduate stage the strong commitment to engineering and science in the prestigious universities is even more pronounced, for over 60 percent of all postgraduate students are studying engineering and science in the ‘research universities’. The advertising literature of the cram schools and test organisations has tended to confirm the longstanding prestige hierarchy of university engineering schools along the lines suggested by Amano’s approach—only three private schools but all seven former Imperial universities were included in the top twelve ranking of engineering schools in 1984 (Westney & Sakakibara 1985). The Percy Committee’s 1945 report foresaw Britain’s need for more engineers, new types of engineer and for a new settlement on the division of labour between universities and technical colleges in the production of those engineers. They prefaced their remarks by a vision of Britain’s role in the world to assist in the rehabilitation of devastated Europe and the development of poorer countries (Percy 1945). One mark of the heavy introspection which descended on Britain over the intervening forty years lay in the report ‘Competence and Competition’, a widely-read report to government on vocational education and training systems, and its vision of ‘joining the club’ as a national goal for the future (IMS 1984). The ‘club’ consisted of the three major capitalist industrial nations—the United States, West Germany and Japan. Although the post-war years have seen rising living standards and a national economic performance which compared favourably with its own past, in relative terms the British economy did not perform as well as its continental neighbours or the new comparator, Japan. A chapter on the Japanese economy was included in the second edition of a text on the British economy (Boltho & Hardie 1985). Despite its apparent incongruity, the authors could justify its inclusion by pointing to some past similarities and the recent sharp divergence in economic experience: …while in the early 1950s Britain accounted for nearly 8 percent of the OECD area’s GDP and Japan barely 2.5 percent thirty years later these shares had changed to 6.5 percent and 14.5 percent respectively. Japan’s

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per capita income, from being some 20 percent of Britain’s level in 1950– 51 had edged ahead by 1980–81. (Boltho & Hardie 1985:527) Yet further echoes of the Technische Hochschule debates re-emerged in the post-war discussions of educational reform. From 1947–64, there were two main sets of innovations in the higher educational system. In the university sector, six provincial university colleges were granted independent charters and powers to award their own degrees rather than London University external degrees. In the technical college sector, central government promoted a set of colleges as direct-grant institutions with independent governing bodies and termed Colleges of Advanced Technology (CATs). These changes were presented in the context of a formalisation of the pyramid of powers and prestige in the technical college sector—at the apex were the CATs identified as national institutions on a par with the universities, below them were regional and area colleges of technology, and local technical colleges were at the base. To some observers, these CATs were Britain’s long overdue Technische Hochschulen. However, the die had been long cast for engineering education and the main source in the growth of graduate-level engineers came through the expansion of the existing universities, particularly the large civic universities. After 1964, there was a considerable change in the face of British higher education: the existing universities were increased in size and the number of universities almost doubled as new universities were created and as the exCATs were transferred to the university sector. Having denuded the technical college sector of its flagships, the government determined on the promotion of 28 colleges of technology as polytechnics and made degree-level studies and degree awards available in them through the Council of National Academic Awards (CNAA). In this much larger higher education system there was still considerable concentration—for example, the 18 largest engineering schools (i.e. those graduating over 200 students) were responsible for over 70 percent of the total output in 1979 (Finniston 1980:82). Now, however, different institutions were involved—for example, the nine technological universities, most of which have at least 30 percent of their students in engineering studies, were responsible for over a third of the university output of engineers. By contrast with the former Imperial universities in Japan, Britain’s ‘technological universities’ have had a relatively lowly position in the prestige hierarchy of British universities (Berthoud and Smith 1980:60). By the 1990s, the polytechnics had been removed from local government control and had the opportunity to apply for charters as universities. Where the Chandler thesis had held that structure followed strategy, that structure provided managerial hierarchies and that these hierarchies provided the stimulus to education supply, some observers have argued that British companies have turned the thesis on its head. They argued that British companies seem to demonstrate that ‘strategy is dictated by structure’ both in the late nineteenth century and for much of the twentieth century (Marshall and

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McCormick 1986:86). However, insulation from change for British companies began to break down in the 1960s with the ending of resale price maintenance, the loss of Imperial Preference, entry to the EEC, and the 1966 Kennedy round of tariff reductions (Marshall and McCormick 1986:86–7). Yet many British companies showed a disappointingly poor response to the new challenges, seeking defensive mergers to stabilise markets without pursuing the opportunities for the rationalisation of production. If the previous crises of war and recession had done little to disturb the economic and social fabric of Britain and provoke more effort to adjust to the new international order, the shocks came in abundance through the 1960s and 1970s (Walker 1980). These changes provoked both the accelerated move towards multi-divisional structures and a re-examination of the education and employment of engineers. Disappointed by the relatively poor economic performance in the manufacturing industry, the Labour government appointed a Committee of Inquiry into the Engineering Profession under the chairmanship of a distinguished Scots engineer and industrialist, Sir Monty Finniston. When the Finniston Committee set out in 1977 to examine manufacturing industry’s needs for professional engineers they broke new ground in a long line of official inquiries by including Japan in their itinerary (Finniston 1980:209–14). Clearly the wheel appeared to have come full circle since the Iwakura Mission had set out from Japan for England to learn the prerequisites of modern industrialism and had been moved to appoint another Scot, Henry Dyer, as Principal of the College of Engineering (Kobu Daigakko) just over a hundred years earlier. There were two further ironic echoes of the earlier Japanese institutional innovation. The Finniston Committee was a creation of an industry ministry. As such, its terms of reference excluded a direct focus on educational reform and the report had to work within the existing structure of educational institutions. However, much the longest chapter of the report dwelt on education, and a curriculum design drawn from continental European practice, the Eindhoven Technical University, was appended (Finniston 1980:236–7). However, while the Finniston Committee urged the better integration of theory, practice and application evident in German-style education, they reaffirmed a belief in a British tradition of putting the weight of industrial training into the workplace: …it is our belief that in the British context the work covered in the last one or two years of continental engineering courses is, of its nature, better undertaken within the working environment…We believe that provided industry accepts this challenge and participates to the full in the new formation packages these will produce even better, more capable young engineers than the continental system. (Finniston 1980:103)

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Having neither the institutional framework of continental European legislation nor Japanese lifetime employment, the Finniston Committee hoped that the mix of putting some more training into the curriculum, rational employer self-interest and exhortation would produce a new social order in engineering formation. The Finniston Committee proposed a new body, an Engineering Authority, as a major focal body for engineering, acting as a major lobby and taking responsibility for supervising a register of engineers. The corollary would have been the restriction of the professional institutions to their role as study institutions, while the state-sponsored body took over the qualifying role. However, the new Conservative government introduced an Engineering Council. While the Council has undertaken some of the proposed roles in acting as a lead body for the profession, it has not undercut the role of the professional by taking over qualifying functions and the register. In several respects, the role of the major professional associations has been strengthened and subsequent developments in education and training have taken place within the continuities of the triumvirate of universities, employers and professional associations. Institutional histories: UMIST and TIT Some of the earlier broad strands in the historical development of engineering education in Britain and Japan can be illustrated through a brief account of the historical development of two institutions, the University of Manchester Institute of Science and Technology (UMIST) and the Tokyo Institute of Technology (TIT). These two institutions signed an academic co-operation agreement in 1979, the first of TIT’s agreements with five UK universities. Although UMIST is located in a provincial city, rather than the nation’s capital, there are clear parallels in the development of both institutions from concerns with artisan education to institutions of university rank. However, Manchester was an important centre for industrial and scientific development in Britain’s industrialisation from the textile industry to the development of chemistry. Moreover, while TIT illustrates the key role of the state in the creation of the institutional infrastructure, UMIST demonstrates the importance of private endowment and voluntary effort in the pioneer industrial nation. UMIST was started as a Mechanics’ Institute in 1824, with a mission to spread popular science education among workers through part-time study. Yet it had largely failed in this role by mid-century and it had become little more than a social club used by the middle class, since the weaknesses in elementary education meant that workers usually lacked the rudimentary basis on which to build further study (Cruickshank 1974:137). The successful redirection of the Institute came with the appointment of J.H.Reynolds in 1879 as secretary, a self-educated bootmaker but gifted as an ‘artisan intellectual’. He had a vision of the Institute as a technical school and he took advantage of the new City and Guilds of London Institute courses and examinations to reorganise classes and instruction. This Institute, started by London livery companies, became part of the later Imperial College of Science and Technology. By 1882, the Manchester

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Mechanics Institute was redesignated as the Manchester Technical School and acquired a new governing body with representation from the local authorities (the councils and school boards of Manchester and Salford), the Chamber of Commerce and Owen’s University (then part of the Victoria University of the North of England, and later to be the University of Manchester). Against the background of growing concern among Lancashire industrialists about trade rivalry with Germany and the relative strength of technical education in continental Europe, parliament passed the Technical Instruction Act in 1889. The new powers permitting local authority support for technical education gained substance with the ‘whisky money’ in the following year. The nonconformist conscience, with prominent Manchester businessmen closely involved, had pressed on parliament the passage of the Local Taxation (Customs and Excise) Act, which provided funds from an alcohol tax which could be used for technical education. By the early 1990s, the Manchester Technical School was firmly under the control of the City of Manchester. Meanwhile, the Victoria University had been dissolved in 1904, Owen’s College became the University of Manchester, and a division of labour was worked out with the university in 1905. Instead of the Manchester University establishing its own Faculty of Technology, the Faculty was located in the Technical School. This intimate relation between University and School endured for almost ninety years. Promotion to the status of Manchester Municipal College of Technology in 1918 was eventually followed in 1956 by recognition of independent university status, under its own Royal Charter and with independent funding from the University Grants Committee (UGC). In the eyes of the Principal, Lord Bowden, ‘the Faculty of Technology of the University of Manchester, established within the Municipal Technical School in 1905, had, in effect, expanded to take over the whole institution’ (Bowden 1974:248). While the Faculty of Technology arrangement continued with Manchester University, all non-degree study was moved in 1966 to the Manchester Polytechnic (now the Manchester Metropolitan University) and the institution took its present title of the University of Manchester Institute of Science and Technology (UMIST). The latest step has followed from the Education Reform Act (1988) and the Further and Higher Education Act (1992) to amend the Charters and Statutes to recognise full academic and financial autonomy for UMIST from the University of Manchester and a new Agreement on areas of mutual interest (UMIST 1994). UMIST now occupies part of a huge campus area in the centre of Manchester, sitting cheek by jowl with the University of Manchester and the Manchester Metropolitan University. The growth of this city-centre campus was achieved from the 1960s with the knocking down of slum dwellings, which had its own ironic twist. In the 1820s, there had been considerable disquiet among the upper and middle classes about Mechanics’ Institutes and their potential as centres for political radicalism among the working class. The area eventually cleared in later twentieth-century slum clearances had been central to Engels’ account of the condition of the English working class in the 1840s and material

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inspiration for his later economic and political collaboration with Marx. By the mid-1990s, nearly 4,700 undergraduates and 1,570 graduate students occupied the UMIST section of the campus, supported by 478 academic staff (UMIST 1997). Whether UMIST was as influential in building human capital in British industry as it ought to have been is a moot point. Yonekawa contrasted UMIST and TIT to suggest that while TIT graduates were prominent in Japanese industry, it is the paucity rather than the plenty of UMIST graduates which is more striking in Britain (Yonekawa 1984:215). However, Kikuchi (seen earlier as one of the Japanese textile engineers who had studied in Britain) was a graduate from the Manchester Technical School (Yonekawa 1984). Efforts to develop Manchester’s technical institution were long hampered by lack of employer demand (Guagnini 1991:86). Although employer complaints about engineering education have emerged in the post-war period, Divall, basing much of his discussion on provision in Manchester’s University and College of Technology, demonstrated how the engineering curricula had a large measure of approval from employers (Divall 1990). Thus, insofar as industrialists wanted engineering graduates, they were reasonably content with those recruited. Although the Tokyo Institute of Technology is highly regarded both inside and outside Japan, its very self-conscious mimicry of America’s most prestigious technological university, the Massachusetts Institute of Technology (or more commonly, MIT) was largely for external image and causes some confusion between Japanese and foreign visitors. In Japan, its name, Tokyo Kogyo Daigaku (or Toko-Dai), more readily translates as the ‘Tokyo Industrial University’. Even this contemporary name is the product of several changes over a lengthy process of historical development and institutional upgrading since the Meiji era. Originally founded as the Tokyo Vocational School (Tokyo Shokko Gakko) in 1881, it was retitled as the Tokyo Technical School (Tokyo Koto Kogyo Gakko) in 1890. By 1901, it had been elevated to the Tokyo Higher Technical School and achieved university status and degree-conferring powers in 1929 as the Tokyo Kogyo Daigaku. The parallels with MIT came with the post-war reorganisation during the occupation period under the National School Establishment Law in 1949, when the Faculty of Engineering was established and the three-year course was extended to four years. Tracing TIT’s historical development under various presidents shows the variety of efforts to weave an institutional fabric appropriate for Japan from many diverse strands of foreign influence, with clear attempts to draw from Britain, Germany and the US. The first president, Masaki Taizo (1881–90), had been sent to England to study at University College under the chemist, Professor Williamson in 1871. Despite the Meiji government enthusiasm for foreign technology, there were still places to acquire either relevant technological skills or employment in Japan. Therefore, Japan was heavily reliant on the ‘imported foreigners’ and the Japanese who went abroad and returned as champions of technological development. Williamson’s assistant, R.W.Atkinson was invited to Japan in 1874 and taught at Tokyo Kasei Gakko, later part of Tokyo University. Masaki,

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who had returned to England in 1876, was recalled to Japan by the Education Ministry in 1881. After a year of planning and preparation, Masaki welcomed the first intake of 60 students to the new trade school in 1882. The experiences of the second president, Tejima Seiichi (1849–1918), illustrate the vicissitudes of life in the social reorganisation from the feudal to Meiji periods and the importance of America as a source of examples for the modernising elite in Japan. Tejima was one of the pioneer advocates of technical education in Japan and his zeal was a major influence in piloting the transformation from vocational school to higher technical school. Born in the late Tokugawa period, the son of a samurai retainer in the service of a feudal clan, Tejima set out in 1871 for study in the US on money borrowed from the clan on mortgaged family property. However, his science studies at Lafayette University were cut short when the feudal class structure was abolished and his funding disappeared. Instead he took employment with the Iwakura Mission, as an interpreter to Iwakura’s secretary, and travelled with the Mission to England and the United States. Subsequent employment in educational administration and official trips to the international expositions in Philadelphia (1876) and Paris (1878) reinforced his resolve to campaign successfully for technical education and the creation of the Tokyo Vocational School in 1881 (Tokyo Shokko Gakko). However, these were still times of transition with difficulties in both budgetary constraints and limited employment opportunities for graduates. Yet Tejima was able to steer his college through two promotions, first to Technical School and then to Tokyo Higher Technical School in his second period as President. Moreover, the efforts to secure full enrolment despite uncertain employment was aided by government measures to adopt premium wages for specified technically trained workers and to exempt students from conscription (Toyoda 1987:10). Professor Dr Gottfried Wagener brought a continental European perspective to the trade school in the 1880s. My own first impressions of Wagener’s significant contribution to Meiji Japan were gathered from the monumental character of his gravestone in the Gaijin corner of Aoyama Cemetery, that tranquil corner of modern Tokyo that ought to attract any visitor accustomed to musing in English churchyards or simply keen to find some respite from Tokyo’s city bustle. Wagener had been among the very first foreigners to arrive in Japan as a technological adviser in 1868, the first year of Meiji. Over the next two decades, he drew on a wealth of academic knowledge and practical experience to promote the two-way relationship between Japan and the West in technology. Originally recruited to advise on pottery in Kyushu, Wagener cautioned against the wholesale adoption of Western techniques and bent his efforts to the modernisation of traditional industry. He helped to make Japan and Japanese traditional products better known at international expositions, such as Vienna (1873) and Philadelphia (1876). His own scientific preparation had been in prestigious company, having studied mathematics under Gauss and taken a PhD at the age of 21 in 1852. But Wagener combined his academic distinction with much practical industrial experience, for he had been involved

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in the establishment of a new iron works in Germany and a new chemical plant in France. In 1871, Wagener was teaching physics and chemistry at Daigaku Nanko, an institution which was later to be part of the University of Tokyo. Wagener’s strong belief that Japan should replace the traditional apprenticeship system with a continental European-style technical education can be seen in his letter of advice written in December 1888 to the Meiji government on a dyeing and weaving school: 14. Besides the training of the school workshop there ought to be evening lectures for the pupils, in mathematics, drawing and designing of machinery, elements of natural philosophy and chemistry etc. This can be done by outside people. In Europe such lectures are easily available in any town, and it would be a good thing if similar lectures were initiated in all the large towns of Japan. Foreign language would also form a subject of outside teaching. 15. As to the financial management of the school it may be observed that in Europe all the pupils pay some fees. This system ought to be adopted in Japan too. It is much better to have only a small number of assiduous pupils who value instruction enough to pay for it, than to have a large number of non-paying pupils. This does not prevent establishing free scholarships in exceptional cases. The above is meant only to explain the main features and the objects of such a school. Further details must be the object of minute deliberation when such an institution will have been decided upon. It is much to be desired that that such a plan will find favour with the manufacturers and weavers of some of the great textile centres. If properly managed the influence of such a school workshop will extend far beyond its limits, not only as a place of teaching and the centre of a lively progressive movement, through the combine efforts of all those interested in the same industry. Such an association of similar interests is the most powerful engine of progress. (Wagener, Tokyo, 16th December 1888) After the progressive elevation of the Meiji trade school through higher technical school to university status by the 1920s, the next turning point for TIT came during the occupation period. The tranisition through the precarious post-war reforms to the contemporary Tokyo Institute of Technology was overseen by Wada Koruko, who became president in 1944 and stayed through seven years of post-war reconstruction. He had graduated from the Tokyo Imperial University in naval architecture to become a leading aeronautical engineer in the 1920s and 1930s. Prior to his appointment to TIT, he had been in government service as deputy director of the Bureau of Technology. Through September 1945 to January 1946, Wada led the faculty and administrators in a series of conferences, championing the reform and restructuring of higher

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education, especially in science and technology, to achieve a better balance between purely technical studies (the previous focus) and broader studies in the humanities. Wada’s ambition to put TIT among the premier technological universities of the world might be guessed from his involvement in aeronautical technology, the ko-ken-ki (KoKu-KenKyujo) machine and the quest for world speed records. It is also evident in his notebooks with their details of MIT and London’s Imperial College of Science and Technology in the late 1940s. Yet, his notebooks indicate the magnitude of the task ahead. In addition to curriculum, teaching and research activity details, Wada calculated MIT expenditure on its 5,172 students at 1,196,000 yen per head in 1946/7 against 153,000 per head in TIT. While MIT’s 5,172 students were divided 74:26 between undergraduates and graduates, TIT’s quota of 1,200 student places were concentrated in undergraduate studies, until the graduate school of engineering was created in 1953. The present eel-like strip of the main campus marks out the great strides made at TIT since the 1920s. From the gleaming aluminium, steel and glass of the eye-catching and controversial Centennial Memorial Hall by the Ohokayama gate, an avenue of cherry trees leads to the main building. Here, the core Faculties of Engineering and Science are housed beneath the light tiles of the sturdy clock tower. This structure marked a new beginning for an institution which had been ravaged by the 1923 earthquake. The Higher Technical School moved in 1924 from the severely damaged Kuramae area, in company with many small businesses, shops and residents. The small lane which runs alongside the campus from Oh-okayama to Ishikawadai provides a more traditional backcloth of small businesses and shops (such as a rice shop, a biscuit shop, a tofu-maker, tailor, and so on) for the towering blocks of science and engineering departments. The 1987 Centennial Hall was designed by the architect Shinohara Kazuo, with bold, simple shapes to reflect the historic character of the centenary and to provide a striking contrast with the more traditionally, densely packed, low-storied buildings of the surrounding streets. However, tradition was respected with the orientation of the massive semi-circular tube at the top of the building to give fine views of Mount Fuji from the lounge and restaurant on clear days. While there is a functional air and grubbiness to many of these large concrete block buildings of science and engineering departments in the middle of the campus, the tail of the campus is being filled with the new ‘intelligent buildings’ of the contemporary era. The space, comfort and grandeur of these buildings, coupled with the speed at which they are being built in the 1990s, is testimony to the support which the educational bureaucracy and a strong economy have been able to provide for leading national universities. On the other hand, the recent reorganisation of university departments into a new faculty to occupy some of the new space provided an insight into the problems of close linkages to central controls, the bureaucratic constraints on a national university and the ramifications of the strife of Japan’s financial and economic difficulties in the 1990s.

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The creation of a new School of Decision-Making Science and Technology in 1996 became caught up in the jusen controversy and the blockage of the March budget. TIT had been keenly supported by Monbusho when it applied to regroup three departments into a new school, to reflect the changing role of these departments and build a stronger critical mass of researchers linking technology and social sciences. Yet approval and financing for the new school was dependent on the passage of the March budget which became blocked by the Diet sit-in opposition politicians. The opposition objected to the budget’s proposed use of public funds to rescue jusen, the housing loan organisations which were in severe difficulties with bad debts acquired by risky loans in the ‘bubble’ period of the late 1980s. Opposition politicians reflected much public anger about the use of public funds not merely because the companies were judged culpable but because of their alleged links with criminal gangs. After being caught up in the knock-on effects of the budget process and the political controversies, the net effect for TIT was a period of uncertainty and the administrative inconvenience of admitting April’s new student entry to the old school structures with the understanding that they would be transferred to the new school if and when the budget was approved, as it was by the political compromise later in April. By 1994, 5,552 students were taught on this main campus (and a Biological Sciences Faculty in Yokohama) together with 2,366 master’s course students and 953 doctoral course students. Thus graduate students made up 37.4 percent of the total of 8,871 students. The faculty:student ratio was 1:15.1 (based on regular faculty staff only and including the cumulative total of all students from bachelor’s, and doctoral courses), or 1:8.7 (if associates are added to the faculty strength). The total of 619 foreign students were only a small proportion of the total (7.0 percent). While there is strong encouragement for a national university to increase its intake of foreign students to complement Japan’s economic role and overseas aid programmes, particularly in east Asia, the foreign student issue has some complications and underscores the problems in taking faculty:student ratios at face value. Within the Japanese academic hierarchy, the pattern of responsibility has been extended downwards like a series of overlapping fish scales as the full professor has been responsible for the associate professor, who is in turn responsible for the assistant professor, who is in turn responsible for the doctoral course, and so on, through the master’s course to each year of bachelor’s students. Extensive support for this pattern of expectations and responsibilities in the academic hierarchy can be found in Japanese culture, and the readily understood relations of senpai-kohai (leader-follower). In this dyadic role structure, the leader has the duty to show the way, and the follower to follow. Simply looking at faculty:student ratios does not tap this dimension of support in student learning. However, overseas students do not readily fit into this structure by either skill or inclination. Therefore any large-scale efforts to boost their numbers are likely to involve a somewhat different approach to teaching and supervision for them, and knockon effects for the pattern of supervision in a department.

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We can see another revealing insight into the workings of the Japanese education system and the nature of technical education by looking at the links of the university with the Technical High School, attached to TIT in 1951. This school performs the role of a flagship school in the vocational senior high school system, playing host to teachers and administrators from Hokkaido to Kyushu. With a good deal of splendour and ceremony, the school, university and Monbusho combine as hosts for exhibitions and demonstrations at the Senior High School to disseminate ‘best practice’ developments through the vocational school sector. The strong emphasis on project work in the curriculum is evident in lively student demonstrations, expositions and in-service events and underlines the strong claims of a sound practical approach to technological education. Yet, few of the Technical High School students who look at the league table of hensachi scores on the Recruit magazine poster are likely to achieve those required for TIT. Despite the formal attachment of school and university, the school’s graduates are more likely to go to a lower ranked university. One plausible explanation for the low transition rate to the university could lie in the amount of project work whose absorbing character distracted pupils from the serious business of honing entrance exam skills.3 Of the 1,154 students who graduated at the bachelor’s stage in 1993, only a minority (23 percent) went into employment, while 77 percent went on to farther study. Whilst, at the bachelor’s level, the proportion entering ‘business’ (12 percent) was higher than that entering ‘manufacturing’ (7 percent), at the master’s stage, the largest slice of the 1993 cohort went into manufacturing industry (52 percent), with 20 percent entering ‘business’ and 11 percent going into ‘further study’. Nevertheless, the proportions of graduates from such a leading technological university entering the business sector rather than manufacturing industry were sufficient to trigger MITI to convene the committee on promoting the attractions of manufacturing industry. Just as graduate students have become an increasing proportion of the student body, so doctoral courses and research have become targets for reform. The long-standing view of the engineering doctorate as a slow track to academia rather than industry has been modified by the availability of shortcuts by which the path through the fourth year of the bachelor’s course can be accelerated into the master’s course, and the master’s course partially incorporated into the doctoral course. Thus while the master’s course has typically lasted two years and the doctoral course typically lasted five years (including the two years of the master’s course), Monbusho sets minimum requirements of only one year for the master’s course and three years for the doctoral course which permit the accelerated path. There is increasing financial support for master’s course, previously wholly dependent on parents. The looser grip of Monbusho on the credit system has enabled the extension of professional studies into the first two years. Meanwhile, TIT has regrouped many of its social scientists and some related engineering disciplines into a School of Decision Science and Technology. Together with the informal discussions with Hitotsubashi University (the commercial school counterpart to TIT’s technical school

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forerunner in the Meiji era) these developments might enable the complementary strengths of these two universities in technology and social science to challenge the pre-eminence of Tokyo University. Conclusions In this chapter, I have examined institutional innovation in advanced engineering education, attempting to explain its origins, to account for the forms which it has taken and to assess its subsequent impact. On the one hand, I have been looking at why and how it occurred in Meiji Japan and how it was subsequently modified. On the other hand, I have examined why institutional innovation did not occur in such dramatic form in Britain. However, the main interest has been in the legacy for present-day engineers of these institutional developments at formative stages in each country’s economic development. To some extent explaining why a new form of engineering educational institution was developed in Japanese was relatively straightforward. If Japan was to avoid Western encroachment, there was little choice but to acquire Western technology and to create the social infrastructure which could enable it to produce the cohorts of elite engineers to direct technological development. Of course, while the issue was clear, the process of acquiring a technological capability required considerable skill and effort. In explaining the form that the new college took, I suggested that it reflected a mix of original design, offthe-peg borrowing and institutional adaptation carried out by British advisers and Japanese hosts, and subsequently meshed with other similarly eclectic institutional developments in the creation of the first Imperial University.4 Posing the counterfactual question of whether the College of Engineering would have been created in Tokyo without Dyer is a challenging way of attempting to assess Dyer’s contribution. However, answers do not seem clear-cut. While it might seem reasonable to argue that the Japanese hosts had a clear view of what they wanted, it is more doubtful that the vision could have been implemented without the engineering and administrative ability to lead the other teachers and deliver the curriculum. For Britain, the pattern of opportunity, incentive and constraint was more complicated. Britain did not face so dramatic a challenge as Meiji Japan and its economy appeared to build on a successful institutional framework. Although some distinguished British contemporaries, such as Norman Lockyer in Nature, looked in admiration at the establishment of the Kobu Daigakko in Japan and urged a similar institutional innovation for Britain, there were a variety of well-established interests ready to argue for alternative paths of development which ranged all the way from maintenance of the status quo of apprenticeship to adoption of the European model, with a host of intermediary compromises (Lockyer 1877).5 The College of Engineering (Kobu Daigakko) established by the Ministry of Public Works was certainly important in marking the determination of the Japanese state’s bid to cope with technological development. It should not be seen simply as either a wholly British creation, or as a British translation of a

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Technische Hochschule. It was the outcome of the negotiations between the Japanese hosts, including a minister who had experienced engineering education in Glasgow, and their hired advisors. Subsequently it was incorporated into the university system with the creation of the first Imperial University, and the subsequent Imperial Universities continued to hold engineering education in high esteem. However, to compare Tokyo, Kyoto or Tohoku with ‘Oxbridge’ has been misleading. Oxford and Cambridge have been very different institutions, with Cambridge attaching high priority to engineering education and providing a refutation to the notion that Britain’s elite educational institutions were hostile to engineering. However, it is clear that the critical mass of elite institutions accommodating engineering has been greater in Japan. Low prestige and diffidence about education for industry in Britain have been more evident in the status of the technical education sector and provision for intermediate technical qualifications, rather than in the engineering education sector. The closer look at two institutional histories—two of the leading engineering universities in each country, UMIST and TIT—served three useful purposes. First, it offered a useful counterweight to our many references to Henry Dyer and his arrival in Tokyo. These references tend, among a British readership, to cultivate a one-dimensional view of international influences on engineering education in Meiji Japan. Tracing the development of the university of over the course of a century, it is clear that a variety of formative influences—from the German trade school to the American technological university—was mixed with the determined vision of Japanese engineers and scientists. Moreover, the development of UMIST was marked by international influences from Scotland, France and Germany. Many of the same reflections on continental Europe could be seen in both institutions, but UMIST appears to have been more constrained in educational developments by the lack of employer demand for its technical graduates or (at later stages) employer contentment with the curriculum. Secondly, it provided a microcosm of the issues seen at the level of the Japanese system, where some of the strengths and weaknesses in the close links to the national bureaucracy were evident. Thirdly, it provided illustrations of contemporary change and development and a reminder of the institutional dynamics underlying the statistics used in the snapshots of international ranking comparisons. One of the most important legacies alleged to flow from the College of Engineering for present-day engineers in Japan—and a feature which allegedly differentiated them from British engineers—has been attributed to the College curriculum. Morikawa cites a stronger emphasis on genba (the workplace), on the importance of workplace knowledge and learning through ‘on-the-job’ training, and a greater readiness to work in closer collaboration with bluecollar workers among Japanese engineers compared to British engineers and relates them all to the practical emphasis in the College curriculum (Morikawa 1991). Basing his Anglo-Japanese comparison on Dore’s account of engineers in the English Electric v. Hitachi case study in the early 1970s, Morikawa

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argues that the British engineers appear anxious to escape the shopfloor and shopfloor work (Morikawa 1991:136). Yet this interpretation blurs the distinction between workplace knowledge and skills and the context of their application and it overlooks the historical continuities in Britain and the changes in Japan. Whether or not engineers ‘work smoothly’ with blue-collar workers is not simply the result of acquiring relevant knowledge and skills, but rests critically on the industrial relations context. Although the College of Engineering lent much to the tradition of workplace learning for higher-level engineers, the important changes in industrial relations which facilitated a more harmonious relationship between engineers and blue-collar workers came between 1945– 53. The pre-war Japanese workplace was very hierarchical, with a sharp distinction between white-collar staff and blue-collar workers. The industrial relations reforms came after bitter conflict and compromise, not as the simple dawning of sweetness and light (Gordon 1993). The labour unions which flexed their muscles in the late 1940s were broken in the early 1950s and parallel unions created by companies. In exchange for co-operation through the new unions, the employers softened staff-worker distinctions through extending the lifetime employment expectation to the regular blue-collar employees. In return, blue-collar workers undertook flexible working practices. Engineers, such as Ohno at Toyota, were able to design the production systems which bore fruit through the 1980s and they were able to enter the workplace and secure the incremental innovations for which Japanese companies became famous. State interests have been important ingredients in both the Japanese and British accounts of engineering education. War, and fear of war, have been an important factors in state support for engineering education. A popular view in the post-war period has been that Britain misdirected its scientific and technological manpower too heavily in the defence industries, while Japan wisely concentrated on the civil sectors. Whether Britain could, and should, have shed its historic legacy as an imperial power with defence obligation to allies more readily are moot points. However, Edgerton has argued that the defence needs underpinned the support of the British state for the aircraft industry and promoted its significant technological feats and achievements in the inter-war years (Edgerton 1996). In any event, there is a curious paradox about the impact of defence expenditure on technological development. On the one hand, Japan is alleged to have benefited from the stimulus of defence needs through the Japanese imperial navy in the early years of industrialisation. Yet, on the other hand, Japan is also alleged to have benefited from its occupation-enforced ban on military expenditures and later self-imposed curbs. Japan’s aeronautical engineers, denied employment in an aircraft industry, moved into other industries. Halberstam cites the case of Tanaka Minoru, one of the most able graduates of Tokyo University in 1935 and one of the designers of the Zero fighter, who moved into Nissan in 1956 (Halberstam 1986:279– 85).

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If defence imperatives were a powerful stimulus to economic development in the earlier period, why was their suppression beneficial in the later period? The answers may lie in the respective stages of technological development and the economic context. In the earlier period, state imperatives might have been important in building Japan’s industrial infrastructure, but in the later ‘Cold War’ era, when defence was supplied by the US umbrella and military hardware for Japan Self Defence Forces could be purchased overseas, Japan’s talented engineers went into those civilian productive industries oriented to competitive markets. Around the same time, comparable industries and companies were struggling to recruit scientists and engineers in Britain. Edgerton might be correct to argue that British military R&D in the 1950s and 1960s did not reduce the volume of civil R&D (Edgerton 1996). And he might be correct in arguing that higher levels of civil R&D would have improved industrial performance. However, the argument overlooks the quality of the respective inputs to military R&D and other prestigious state ventures such as the nuclear industry and civil aircraft. The feeling that the United Kingdom Atomic Energy Authority (UKAEA) siphoned off the pick of Britain’s able scientists and engineers by involvement in the screening process for national service conscription prompted several companies to form the Industrial Fund for the Advancement of Scientific Education (1955–63). Sensing that they could not compete with the UKAEA, these science-based companies determined to enlarge the potential by promoting scientific education in the independent schools, on the assumption that the state should put matching capital expenditure on laboratories and equipment in the maintained sector of education (McCormick 1989). As British companies struggled to compete with a large and prestigious public sector for a fair share of national scientific and engineering talent, Japanese companies were able to take a large share of ‘the cream’. The central features of Japanese engineering education usually picked out in recent international comparisons have been: the relatively large numbers produced; their recruitment from able students with high-status social backgrounds, the general satisfaction with their pattern of education and training, and their entry to high-status positions in employment. Yet these features of the contemporary Japanese engineering workforce should not be simply imputed to nineteenth-century legacies: • While Japan produces many more graduates per head of population than Britain from institutions which are called universities, this is very much a product of the post-1945 period when Japan’s economy expanded and Japan moved more swiftly towards a mass higher education system. Moreover, the statistical comparisons have always been complicated by Japan’s relatively small (and Britain’s relatively large) output of science graduates. • The tradition of taking a larger slice of the higher ability male students from high-status social backgrounds into formal engineering studies has a much longer tradition in Japan, traceable back to the late nineteenth century Kobu Daigakko.

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It reflects the ‘late development effect’, the need to build the capacity to absorb foreign technology for industrialisation, and the nature of job opportunities for the displaced samurai.6 • The mix of education and training and the importance of genba (the factory floor) in training for high-level engineers in Japan has deep roots too. It reflected the need for graduate engineers to handle the imported Western technology, the scarcity of trained supervisory personnel in Japan’s early industrialisation, and the traditions established in the curriculum of Kobu Daigakko (Morikawa 1991:138). However, the impact of Japan’s emphasis on practical training for graduate engineers owed much to the post-war industrial relations reforms and should not be seen as part of a simple direct lineage without reference to the changing employment context. For much of the period considered here, Britain relied largely on engineers trained in the workplace through a mix of on-thejob training and evening classes and a smaller group recruited after full-time academic education followed by industrial training. In Japan, the division of labour in education and training has not aroused much recent controversy because the division of labour between educators and employers reflected a better established consensus on respective roles and leaves a relatively academic curriculum to be complemented by employer training (McCormick 1988b). Such a consensus rests on the corporate strategies of employers and what they seek from education and training for engineers. • The creation of the College of Engineering and state support for engineering education have been seen as symbolic reflections of the relatively greater rewards heaped on engineers in Japan and the relatively greater ease with which Japanese engineers have penetrated elite levels of decision-making in industry and government. However, the evidence is by no means clear-cut that Japanese engineers could—and British engineers could not—enjoy high social status. Morikawa’s data for a zaibatsu illustrates that engineers were hardly advantaged over economics or law graduates. However, Morikawa argues that the development of the lifetime employment system provided a route to the board for engineers which in other countries would probably have gone to an external finance director (Morikawa 1989). While they might have been part of the elite education, it seems that engineers did not begin to reach the policy-making levels of bureaucratic hierarchies in significant numbers until the Second World War (Sumiya and Taira 1979: 229; Nakaoka 1981:12). Increased opportunities came after 1945 with the dissolution of the zaibatsu, the purges of managers, and the emergence of new industries and companies which opened the way for entrepreneurs such as Ibuka, Morita and Honda and for engineers as managers. Contrary to the those who argued that the lingering grip of pre-industrial culture held back engineers, Watson argued that the Victorian engineer had relatively high status and that the problem to be explained was a ‘fall from grace’ (Watson 1976). While conceding the uneven pattern across different branches of engineering, Edgerton has ventured a spirited case that the entry of engineers (and chemists) to leadership positions in British industry has been understated in the past (Edgerton 1996:25–8).

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One of the main implications of this chapter has been the need to look more closely at the links between enterprise strategy and structure and the development of education and training systems. Here a continuing contrast between Japan and Britain has been the market orientation of British companies, whether in buying engineering skills through the market from consultants or research associations or in pressing the state and students to bear the costs of skill training in a more vocationally relevant educational system. Japanese companies have striven for a more enterprise specific system of training to complement formal education. How far increasing product market difficulties and more open labour markets will move the Japanese manufacturing companies to emphasise different skills and modes of training remain matters of future speculation. In subsequent chapters I will continue to use cross-sectoral and cross-cultural comparisons in order to explore the dynamics of employmenteducation linkages. As Von Tunzelmann argued, there have been a number of different national institutional patterns of engineering knowledge development and use in the course of industrialisation. While it is clear that the Japanese pattern proved particularly effective for manufacturing industry through the 1950s to the 1980s, at a time when Britain had difficulties in establishing a nation consensus on institutional arrangements, it is an open question which national pattern might prove most effective in the future (Von Tunzelmann 1997:76). Notes 1 The new college was initially established with the title Kogaku Ryo (Technical School), but renamed Kobu Daigakko (College of Engineering) in 1877. Some writers translate this latter title as ‘College of Technology’, although Dyer himself used a grander title of ‘Imperial College of Engineering’. The sponsoring ministry, Kobusho, is sometimes translated as the ‘Ministry of Industry’, but here I will follow Dyer’s usage of the ‘Ministry of Public Works’. 2 Nakayama was using the College of Engineering archives, Kyu-Kobu-Daigakko Shiryo (Materials of the Former College of Engineering). 3 However, if it were simply a matter of a high-level of efforts being put into project work, then it seems that TIT could establish a quota for these pupils. For example, Japanese children educated abroad (returnees or kikokushijo) have been thought to have suffered ‘unfair’ disadvantage in the traditional entrance exam competition, but powerful lobbies and an acceptance that they had gained other valued knowledge and skills in the course of a different educational path led to the creation of quota places at national universities (Goodman 1990:42–3). The reluctance to create such a parallel quota appears to reflect the depth of attachment to entrance exams and the belief that the more academically able have gone through the academic rather than vocational streams. 4 For a broader discussion of the processes through which Western models were introduced and adapted in novel forms see Westney (1987). 5 Lockyer was also a keen promoter of Germany as a model for scientific and engineering reform in Britain, until rivalry with Germany prompted his rejection of an unacceptable exemplar (see MacLeod 1969). 6 See Dore’s much older discussion of a similar mix of factors in the origins of industrial relations institutions in Japan (Dore 1973:375–6).

2 International rankings of engineers

‘…Britain has only half the number of engineering graduates of West Germany, and our yearly output of qualified engineers is only one tenth of the yearly output of engineers from Japan’s universities.’ (TUC 1985:12)

Introduction Does Japan produce many more engineers than Britain? Has a large output of engineers been a significant factor in Japan’s post-war economic success? Very emphatic answers of ‘yes’ to both of these questions united captains of industry and labour unions in Britain in the mid-1980s and put pressure on the government to take policy initiatives to boost the number of engineers in Britain. League tables of the numbers of engineers produced have been used like totems of national prowess, both as indicators of national effort and manifestations of success. In the early post-war years, as the ‘Cold War’ began to take shape, many of the comparisons were between Soviet efforts and those of the Western capitalist countries. Numbers of engineers could be counted like missiles, tanks or troops as ‘divisions in the factory’ to make the big push in extending national industrial capacity. As ‘peaceful coexistence’ took shape and note was taken of the economic growth in neighbouring European economies, more attention was paid to comparisons of the numbers of engineers and other technical workers in Germany and other countries of the EC. Comparisons with Japan marked a new phase of concern about British manufacturing industry from the late 1970s and a new awareness of Japan as a major economic power. This chapter provides a critique of how that awareness came to be expressed in the construction of league tables of numbers of engineers, the ready exaggeration of the numbers of Japanese engineers, the relative neglect of qualitative dimensions of comparison, and an account of the way in which the institutional framework for the education and training of engineers is changing in both countries, with some elements of convergence and divergence. Questions about how many engineers a government should aim to produce became important issues for many governments and their committees of advisers

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in the post-war heyday of manpower forecasting and educational planning. Having seen the contribution of science and technology to national survival and believing that they were going to be central to peacetime economic growth, governments were obliged to act. Governments, which had assumed more central direction of their wartime economies, accepted wider responsibilities for economic prosperity, full employment, social welfare and their education systems. To judge their needs for engineers and scientists, they adopted a battery of varied techniques to forecast future employer demand, to estimate likely student numbers and to guide educational planning. International comparisons provided another spur to the production of engineers and scientists, particularly when the spectacular success of the Russian Sputnik launch in 1957 set a challenge for the capitalist camp of nations, for example, capturing the public imagination and stimulating discussion about national needs for engineers in both Japan and Britain. In Britain, there were still further echoes of national aspirations to be counted among the superpowers. Further into the 1960s, the comparisons began to reflect more strictly economic and industrial concerns. Yet a key problem remained that, despite all the plausible cases that could be built for manpower forecasting, the concepts and tools remained inadequate and the advisory bodies were vulnerable to takeover and the special pleading of vested interests. For Britain, this hiatus between the apparent need for effective manpower forecasting and the capacity of manpower forecasters to deliver effective guides seemed most disappointing and led to some of the sharpest debates over the advantages and disadvantages of using manpower forecasting to guide educational planning (McCormick 1977). On the one hand, Britain appeared to need forecasts because the strong emphasis on early specialisation in the British educational system meant a lengthy gestation period for educational investments and meant that ‘shortages’ could prove extremely damaging. On the other hand, the problematic nature of the tools for manpower forecasting (from short-run employer surveys to long-term input-output projections, and even rate-of-return analyses) had been subject to much criticism. Moreover, the problems were compounded by the structure of the forecasting bodies, their liability to be captured by vested interests, and a propensity to advocate overproduction of engineers and scientists. One obvious remedy to the ‘manpower problem’, that could be agreed by manpower forecasters and their economist critics alike, was to reduce the degree of educational specialisation, which could be justified on educational grounds alone, but which had the further merits of delaying occupational choices and shortening the gestation period. Put in these terms, educational reform reinforced the case for international comparisons because now the purpose became a comparison of notes on institutional structures, interinstitutional relations, course design and flexibility, and so on. By the 1980s, Japan had joined the list of favoured destinations for education missions determined to unravel the educational contribution to its economic success. Many of the American and European observers were immediately drawn to the construction of league tables of numbers of engineers with dramatic claims for the relatively large numbers of engineers enrolled or graduating from Japanese

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universities. However, many of these numerical comparisons have proved wildly exaggerated. The claim that Japanese universities graduated ten times as many engineers as Britain quoted at the beginning of this chapter proves, on closer inspection, to have been widely popular and highly erroneous. Often comparisons were built on very shaky knowledge and a poor understanding of the basic institutions and descriptive data—for example, using the very broad Japanese notion of ‘gijutsusha’ compared to the narrower British conception of an ‘engineer’ or contrasting very general Japanese definitions of ‘higher education’ with the narrower British definition of a university. In the next section, I will take a closer and more critical look at the comparisons of numbers of engineers drawn by Japanese and British observers. In order to set these comparisons in context, I will devote our third section of this chapter to a sketch of the institutional framework of the two educational systems, and the way in which it has been changing. In our fourth section, I will probe further behind the numbers and underneath the labels to explore some of the more implicit qualitative dimensions tucked away in the quantitative comparisons. Controversial numbers Many of the early British attempts at manpower forecasting for educational planning reflected both the ‘Cold War’ context and lingering British aspirations to ‘superpower status’ with many references to the US and USSR and their numbers of ‘qualified scientists and engineers’ (QSEs). As economic recovery progressed in Europe and as Britain’s lofty international aspirations proved unsustainable, new league tables of educational outputs and labour force numbers were constructed around the ‘middle ranking powers’ with more European comparisons. In the 1970s, more attention was paid to Japan and its seeming massive numbers of engineers. Often, parallels were drawn between the league tables of economic performance and league tables of numbers of engineers by those with vested interests in pressing the British government for increased public support for science and technology. The science and engineering lobbies could combine in demanding an increased supply of engineers and scientists and increased public support for science and technology programmes in the public and private sectors. Despite the dubiousness of some of the sources, interpretations and statistical exercises, league tables lent all the air of scientific and quantitative certitude to weapons to beat government. The pity was that more modest and ‘realistic’ statistical comparisons were quite impressive in themselves and could have generated a more fruitful discussion. Over-egging the pudding risked generating scepticism, disbelief and a refusal to take comparison seriously. One exaggeration which gained some adherents was the notion of a tenfold Japanese superiority in numbers of engineers. A prominent platform for this idea was provided by the publication of an article by Oshima Keiichi, a very distinguished emeritus professor and engineering representative to the Japanese government and international bodies, in the Journal of Trade and Industry, an English-language publication edited by the Japan External Trade Organisation

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(JETRO), which was an arm of the very influential Japanese Ministry of International Trade and Industry (MITI). Oshima compared student enrolments in Japan and several European countries and his figures suggested a tenfold Japanese advantage over Britain in enrolments (368,770 v. 35,817) by the early 1980s (see Table 2.1). However, a closer reading of the table notes in the original article reveals problems of overestimate of the Japanese figures (and underestimate of the British figures) through the types of institution covered, the types of discipline included in ‘engineering’, and the length of course. The Japanese figures included the junior colleges and the technical colleges alongside universities, whereas the polytechnics and other institutions providing degree-level studies were excluded from the British side. The Japanese figures included architecture with engineering, whereas architecture was put in the ‘other’ column in British figures. Looking at enrolment figures produces a distortion when the typical Japanese university bachelor’s course lasted four years, while the typical British bachelor-level degree course lasted only three years. If we restrict ourselves to compare bachelor-level degree courses and if we put them on a common basis of annual outputs then we should knock out the Japanese junior colleges and technical colleges, but include British polytechnic and other institution degreecourse outputs, and we should exclude architecture in both countries from engineering. The result of these adjustments is to reduce a tenfold advantage to a fivefold advantage. Once we adjust for the larger population of Japan and divide by a factor of two, we find that the annual output of Japanese bachelor-level degrees was roughly two-and-a-half times that in Britain. Many British engineering employers might well have settled for a doubling of the supply of British engineers, if we leave to one side the question of the relative industrial competence of new graduates in Japan and the implications for Britain’s creaking industrial training system of such an expansion of new entrants. The mindnumbing exaggeration was unnecessary. However, throwing caution to the winds (and without any source reference), we have seen that the tenfold enrolment advantage of Oshima was represented as a tenfold annual (!) output by the British labour movement in the Trade Union Congress (TUC) document on the state of R&D in Britain (TUC 1985: 12). To demonstrate that exaggeration was not a monopoly of labour, a distinguished captain of British industry concurred with the tenfold output comparison. Sir Kenneth Corfield, as Chairman and Chief Executive of Standard Telephones and Cables (STC), had written a well-received (NEDO) Report on ‘Product Design’ and had given the Finniston Committee of Inquiry into the Engineering Profession a good impression as a clear-sighted industrialist with cogent evidence (Corfield 1979). Subsequently, he was appointed by the government to be the first Chairman of the Engineering Council, set up following the recommendations of the Finniston Committee. Setting out a position paper for the Engineering Council, Corfield observed of Japan: ‘between the years 1965 and 1977 Japan doubled the ratio of engineers to its total workforce and by 1978 was turning out ten times as many graduate engineers as Britain’ (Corfield 1984:245). Again, there were no sources or bases given for the figures

Source: Oshima 1983

Table 2.1 Number of higher-education students by subject

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of 6,897 British engineering graduates and 71,167 Japanese engineering graduates in 1978. Yet Corfield’s position at the head of the Engineering Council, the body appointed by the government to serve as the lead national organisation to lobby on behalf of engineering, gave him the ear of government and influence on policy. The Engineering Council pressed for a shift in the ratios of science and engineering students to arts and social studies students from 50:50 to 55:45. Within a year, the government launched the Engineering and Technology Programme to increase engineering student numbers. Since it was launched in a period of severe restraints on other areas of education, it became nicknamed the ‘switch programme’, although it had little success in changing proportions and led to empty places in polytechnics. Britain was not alone in having debates about the numbers of scientists and engineers in the national labour force. A parallel process could be observed in the US where disappointment about American relative economic decline had prompted a similar interest in the Japanese educational system. Analysts drew attention to an apparent numerical superiority in the output of engineers in Japan and claimed that this was a significant factor in the success of Japanese manufacturing industry in world trade and capturing American market share (Grayson 1983, 1984a, 1984b, 1987a, 1987b). In several trenchant critiques, Kinmonth has challenged the ostensible numerical superiority at bachelor’s and master’s degree levels, and associated arguments that Japanese engineers enjoyed relatively higher social rewards, such as higher incomes and higher status, which were further causally related to superior economic performance. (Kinmonth 1986, 1987). Meanwhile, the British government’s Department of Education became stung by the volume of criticism directed against its bailiwick and began to co-ordinate a more critical look at comparative statistics. Some of the critical commentary came from bodies close to government itself. The Manpower Services Commission (MSC) (created by the government to promote vocational education and training and to bypass any obstructions by vested educational interest groups and the education bureaucracy) had combined with the National Economic Development Council (a tripartite body linking employers, trade unions and government) to issue a much-publicised report, Competence and Competition, which listed shortcomings in British vocational education and training compared to the inputs, systems and outputs in Germany, the United States and Japan (IMS 1984). The direct comparison of the output of graduate engineers was tucked away in the statistical appendices, but the figures of 74,000 bachelor graduate engineers in Japan in 1982 (or 630 per million of population) against 15,000 bachelor graduate engineers in Britain in 1982 (or 270 per million of population) put the Japanese advantage nearer twofold than the tenfold of the Engineering Council and TUC, even without the footnote caution that the Japanese total included architects (who would have added 9,000 if included in the British total). The thrust of the NEDO/MSC critique lay, not so much in the numerical comparisons, but in the more qualitative comparisons relating to the broader character of Japanese degree studies, the readiness of employers to support

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training and the Japanese superiority in numbers of intermediate skill ranges. However, the MSC appreciated that their 6,000 word limit for the country reports had constrained them to deliver accounts in the style of bullet point headlines. Therefore the MSC commissioned a fuller study designed to ‘give a feel for the way in which the Japanese vocational and education system worked’ from specialists on the Japanese employment system and its interaction with the education system (Dore and Sako 1987, 1989). Meanwhile, the DES went on the offensive against the Engineering Council and the ‘Competence and Competition’ report through the Interdepartmental Working Group of departmental statisticians, emboldened by the new ‘switch’ programme and a feeling that critical comparisons had put Britain in a poor light by focusing on first-degree engineers. They felt that this focus neglected the large sub-degree element in the British system, a sector which was all the more important in view of the UK selective policy on entry to degree courses and the relatively short specialised character of first degree courses. Using the International Standard Classification of Education (ISCED) of three levels of 5, 6 and 7 corresponding to sub-degree, first-degree and postgraduate qualifications and UNESCO sources, the Interdepartmental Working Group drew up a variety of comparisons, including ‘engineers/population in the relevant age group’, ‘engineers/population employed’ and ‘engineers/population employed in industry’ (DES 1987, 1990). The statisticians conceded that when the focus was put on degrees alone (level 6) then Britain lagged behind Japan, Germany and the US, but matched France. However, when the levels of sub-degree, first-degree and postgraduate qualifications (i.e. levels 5 plus 6 plus 7) were added together, the UK emerged as second only to Japan in numbers of engineers per relevant age group. Using the cumulative totals against ‘population employed’ or ‘population employed in industry’ put Britain in an even better light, outshining all the other countries, even Japan. Britain could appear as ‘number one’ in the engineering league tables. Having seen the recession of the early 1980s wipe out a quarter of Britain’s manufacturing industrial capacity, it seemed ironic that Britain had finally solved years of alleged post-war engineering shortage—not so much by boosting supply as by reducing industrial demand. The Engineering Council responded swiftly and vigorously, commissioning the Research Unit of the Engineering Professors’ Conference to undertake its own statistical comparisons and charging that the civil servants were complacent. The Engineering Council urged that Japan, as the new world centre of ‘best practice’ manufacturing, should be the target for comparisons. Drawing on several studies in progress, the Engineering Council commissioned its own study through the Engineering Professors’ Conference (McCormick 1988b; Dore and Sako 1989; Prais 1987). On the basis of their new study, the Engineering Council argued that the Working Group had seriously underestimated the output of sub-degree engineers (level 5) in Japan (Blears and Bonnet 1988; Engineering Council 1988b). The problem lay in the convention that the Japanese Ministry of Education, Science and Culture (Monbusho) did not include the private sector Miscellaneous Schools (Senshu Gakko) in its returns to UNESCO, thus

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understating the Japanese side of comparisons equivalent to the British Business and Technician Higher National Certificate by a factor of three. The Engineering Council went on to some further comparisons of specific Japan/UK ratios which told against the British output: for example, in engineering graduate disciplines associated with the manufacturing industry (for electrical and mechanical engineering in 1983 the ratio was 3:1, for chemical engineering it was 5:1 and for production engineering 9:1); in applications to places for university study in engineering (4.7:1 for Japan compared to 1.7:1 in the UK); and in the apparently much larger pool of eighteen-year-olds with mathematical qualifications in Japan than the UK. Prais, who had done a great many meticulous comparisons of productivity and vocational education and training across different industrial sectors, particularly exploring the intermediate qualifications in Europe, added some further refinements to the Anglo-Japanese comparisons to suggest another aspect of Japanese advantage in advanced engineering skills (Prais 1988). While his previous work had underlined British shortcomings against German craft and technician levels, Prais argued that a gap was emerging between Britain and several other advanced industrial nations, especially Japan and Germany, at the equivalent of master’s level courses. Although, per head of population, Britain was still producing double the number of engineering doctorate-level graduates of Japan, the situation was reversed at the master’s level (see Table 2.2). In this comparison, the figures for Japan at the technician level appeared more modest, with a range of figures reflecting different assumptions about comparators. However, by the late 1980s, there was broad agreement about the orders of magnitude of the Japanese superiority in numbers of bachelor’s level engineers compared to Britain.

Table 2.2 Engineering graduates in the UK, France, Germany, Japan and USA (units: ’000s)1

1 The table includes the numbers qualifying in engineering and technology, with the original numbers for Japan and US reduced in proportion to UK population for 1985. 2 Note that Doctorates and Master’s degrees should not be added to Bachelor’s degrees to avoid double-counting. 3 These figures and those directly below include computing and data processing. 4 Mechanical and electrical qualifications only (that is, excluding building); the comparable UK total is 24,000. Source: S.J.Prais 1988:81

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Having seen the shift from the wilder hyperbole of Anglo-Japanese comparisons of tenfold to twofold numbers of first-degree level engineers over the decade, it is now time to look at the institutions from which engineers graduate and how they are being reformed in the 1990s. Outlines of the two educational systems The most obvious contrasts between the two systems for producing engineers lie in the role of the state and the way in which reforms are changing that role. The Meiji state created a Ministry of Education ahead of industrialisation, as we have seen in Chapter 1, and used the educational system as a direct instrument of economic and political development. Reform in Japan in the 1990s has been marked by some relaxation of that central grip on the educational system and efforts to introduce more variety in educational provision. Britain was until recently quite remarkable in the extent to which the central government left education matters to local authorities or relatively autonomous bodies and left training matters to employers and trade unions. The result was a scattering of remarkably creative initiatives and worthy endeavours set as islands in a very troubled sea. As those trembles grew more tempestuous the state began to assume more responsibility for building more secure bridges between schooling, training and work. Early signs of that growing state responsibility came with the passage of the Industrial Training Act in 1964 and the creation of the industrial training boards, using a payroll tax to encourage employer training. Increasing concern about economic performance has stimulated both central government and employer involvement in the educational system. During the 1980s and 1990s, the pace of Government initiatives has quickened sharply, with much stronger central control exercised over universities through state agencies. By comparison with the English attempts to reintroduce distinctively vocational schools, or stimulate new experiments in vocational curricula on top of fairly extensive examination work in vocational subjects, the compulsory education system in Japan up to the age of 15 seems remarkably free of vocational elements. Of the 1,015 school hours to be filled in each of the three years of junior secondary school, only 70 (less than 7 percent) are devoted to ‘industrial arts and home making’ in each of the first two years, rising to 105 hours (10 percent) in the third year (NIER 1988). Vocational education proper begins after the end of compulsory education. Given that over 90 percent of Japanese youth proceed into some form of full-time education beyond 15 there is a large potential exposure to the vocational courses in the senior secondary schools offering both general and vocational courses, or in vocational courses in schools offering only vocational courses, or in technical colleges, or in special training schools or miscellaneous schools in the private sector. Figure 2.1 gives an outline structure of the Japanese education system and the progression rates between different types of institution. In 1994, at age 15 and the end of compulsory schooling, the majority of Japanese students, over

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two thirds, proceeded to the more academic general courses of upper secondary schools (70.7 percent). About one quarter of the students proceeded to vocational courses in the upper secondary schools (24.9 percent). A tiny proportion (0.7 percent) entered on the five-year course offered by the technical colleges, which are operated mainly by national government. A somewhat larger proportion proceeded to a course in one of the Senshu Gakko ‘special training schools’ (1.2 percent). Only 2.5 percent of the age group were seeking employment at this stage (1.7 percent actually finding employment and 0.8 percent recorded as unemployed). At the age of 18, over 30 percent of the age group proceeded to study at one of the four-year universities or two-year junior colleges, while a tiny proportion continued into the more advanced stages of their colleges of technology. Over one quarter (28.6 percent) proceeded to shorter courses in the private-sector ‘special training schools’. Thus, by comparison with British practice, the Japanese system has been remarkable for the high participation rates beyond compulsory schooling and for the full-time nature of study. Vocational courses at the upper secondary stage can be found in either wholly vocational schools or schools offering both academic and vocational courses. The 16 percent of upper secondary schools which offer only vocational courses

Figure 2.1 Progression routes in the Japanese educational system (1994)1 1 The statistics present a cross-section of age groups and are not strictly the progression of one cohort. Source: H.Muta (personal communication)—based on Ministry of Education Monbu Tokei Yoran (summary of statistics on education) 1995

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tend to be very specialised, either as industrial, commercial or agricultural high schools. Some of these schools are trying to adapt to the very different economy in which they now find themselves—for example, fishery colleges mount courses in water sports and leisure to cater for the changing employment opportunities. These schools and the 31 percent which offer some vocational courses are outnumbered by the 53 percent of schools which offer only academic courses. The academic character of much of this education, carried out beyond compulsory schooling and at parental expense, is further emphasised by comparing pupil numbers and noting the increasing proportion in academic courses, from 63 percent in 1975 to 68.2 percent in 1980. This trend towards more academic provision has been partially offset by developments in the private sector, for in 1976 the creation of higher standards permitted the promotion of some special training schools (Senshu Gakko) from among the Miscellaneous Schools (Kakushu Gakko). This means that graduates from academic streams can proceed to acquire more vocationally oriented education after 18. At the tertiary stages there is a mix of institutions from the universities offering four-year undergraduate courses, junior colleges offering two-year courses, and the five-year colleges of technology (Koto Senmon Gakko), which span the equivalent of three years of upper secondary school and two years of junior college. There is a very high degree of sex-typing in these institutions and their courses. The majority of students (almost 90 percent) enrolled in junior colleges (Tanki Daigaku) are female on courses in humanities, social sciences, and home economics, with only 5 percent studying engineering. In the 1960s, there was concern of a vocational kind that the then planned higher education would not satisfy industrial requirements. This prompted the development of two-year institutions for engineering equivalent to junior colleges. However, in order to escape the female home economics image of junior colleges, they were created as five-year technical colleges and tend to have male students (almost 100 percent) studying engineering (Asahi 1987). In the four-year universities (Daigaku), engineering has a prominent place in the more prestigious universities. Compared to the overall proportion of 20 percent enrolled in engineering across the university system, this proportion rises to over 30 percent in the former imperial universities. Most educational investment has been undertaken by parents and children in the belief that it will lead to better employment opportunities. As employment opportunities expand and contract with labour market evidence of under- and over-supply, it is to be expected that students and their families will weigh more carefully the balance of extrinsic and intrinsic merits of particular fields of studies. In Japan, it is the long-term perspective which seems to pervade pupil and parent perspectives; for example, in his human capital model of educational expansion Kaneko found an income-elasticity of demand consistently greater than unity through the 1960s and early 1970s, suggesting that Japanese parents and children were not sensitive to short-term fluctuations in employer demand for graduates (Kaneko 1987).

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Japan has been unusual in the extent to which central government regulation defined breadth in curriculum, even into universities. In the 1980s, the core curriculum in the junior and secondary school system emphasised a spread across Japanese, mathematics, science, social studies, and a foreign language (typically English). In 1989, these curricula were revised for implementation in 1994. Again in the 1980s, the entrance examinations to the national universities assessed competence across the broad spread of subjects, although applicants to private universities could specialise more narrowly in three subjects. In higher education, the Ministry of Education, Science and Culture credit requirements of 124 credits for graduation used to make explicit requirement for breadth in undergraduate education, with the specification for 36 credits in general education, eight credits in foreign languages and four credits in physical education. Although there had been some controversies about the quality and relevance of some of the general education for engineers and scientists, this breadth was striking in comparison to the narrowness and technical specialism of British engineers. In studying a foreign language, Japanese engineers gained some sense of cultures beyond their own. However, various reports from the University Council, established in 1987, have proposed reforms to make qualitative improvements in higher education, including more diversity across university curricula. Therefore, since 1994, the overall 124 credit requirement has remained but each university has gained discretion over subject requirements. Inevitably, universities have been moving at different speeds to take advantage of the new opportunities (Monbusho 1993; Monbusho 1995). In principle and practice Britain has three education systems, but I shall deal largely with that covering England and Wales. Historically the English educational system was conceived as a ‘national service administered locally’ and it tended to be portrayed as a partnership between central and local government. The basic structure derived from the 1944 Education Act, subsequently amended by the 1988 Act, and distinguished primary (age 5– 11), secondary (11–16) and further education. In the post-war years, the state system followed the European tradition of selective secondary education, providing ‘grammar schools’ with an academic education for the ‘academically able’, about 20 percent of the age group in the system. For the majority, ‘modern schools’ were available, while a tiny technical school sector catered for an intermediate 5 percent of the ability range. By the 1970s, these streams were drawn together in the development of comprehensive schools on American lines to cater for 90 percent of the school population in the state system. Thus the specifically technical schools tended to be submerged from view, although it must conceded that they were never very prominent. Outside the state system, the ‘public schools’ operate as private institutions open to state inspection and cover about 7 percent of the age group, now preferring the term ‘independent schools’ to ‘public schools’ to capture a whiff of rugged entrepreneurship rather than privilege.

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During the early 1980s, less than 20 percent of the 16–19 year old age group stayed within the school system. Outside the school system the routes lay through either a college of further education, or employment (with or without further part-time study) or unemployment. At the post-secondary stage institutions have been distinguished into ‘higher education’ (essentially the universities), with the remainder (a mixture of colleges of further education, technical colleges, polytechnics, and institutes of further education), termed ‘further education’. However, the availability of degree studies in polytechnics and selected colleges blurred this distinction from the 1960s. Within ‘further education’ there was a further distinction between ‘Advanced Further Education’ (AFE) and ‘Non-Advanced Further Education’ (NAFE). The academic route through schools or further education college typically led to the Advanced Level ‘General Certificate of Education’ (GCE A level), which has been the main qualifying examinations for entry to higher education. The routes through technical and vocational have been much more complex. Courses up to and including A level or its equivalent have been designated NAFE, while courses above that level have been termed AFE. The NAFE sector has been the main provider to industry and business of vocational education for recent school-leavers, usually via part-time day or block release. The NAFE sector for operator, craft and technician levels of education and training is overseen by a large number of examining and validating bodies. These bodies provide some co-ordination over a very varied sector. In the industrial field, two bodies are particularly prominent: the Business and Technical Education Council (BTEC) covers the technician level and the City and Guilds of London Institute (CGLI) covers the craft level. The apprenticeship system in Britain had its roots in the pre-industrial guild system, as in Germany. However, there have been a number of marked differences in the manner in which apprenticeship developed in the industrial period in Britain compared to Germany (Lane 1989:71). In Britain, there has been much less regulation of employers by either the state (for example, of apprentice release for education) or other outside bodies (for example, by chambers of commerce of training plans). The terms of training were largely the outcome of negotiations between employers and trade unions and, until the 1970s, apprenticeships were based on time served rather than competence standards. From the late 1970s to the early 1980s the apprenticeship system suffered a dramatic collapse in manufacturing industry, with the number of apprentices falling from the high point of 236,000 in 1968 to barely 100,000 in the early 1980s. Several factors contributed to this collapse, including the misfortunes of British manufacturing industry in the 1979–81 recession, employer discomfort with the inflexibility and narrowness of most schemes, and the relatively high levels of youth wages as a proportion of the adult wage. Since the 1980s, apprenticeship has not been revived on a wider scale. While there have been some encouraging signs in the ‘Modern Apprenticeship’ scheme, initiated by the Government in 1993, there are continuing weaknesses too. On the positive side, Gospel identifies the extension of apprenticeship to

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occupations not previously covered, the development of apprenticeship agreements, and the potential for greater transparency and transferability (Gospel 1998:451). However, he notes also continuing frailties in the weakness of demand (leading to lack of provision of places) and the lack of state involvement through a legal framework. Rather than a full revival of a labour market route to training for ‘intermediate skills’, Britain seems more determined on moving towards the French pattern of vocational education and training (Lane 1989:71). Even as late as the 1960s, half the new entry to professional engineering had come through a non-degree route of part-time study and professional institution examinations. Yet by the 1980s, the bachelor’s-level degree had become the mainstay route to professional engineering in Britain. Bachelor’s degrees were offered through 48 universities, 28 polytechnics and 12 other institutions. The scale of activity varied widely, with the 18 biggest schools (those graduating over 200 students a year) responsible for about 70 percent of the output (Finniston 1980:82). There was some variety in course structure too. The ‘technological universities’ had developed ‘sandwich courses’ which attempted to integrate periods of academic study and industrial practice, while the ‘new universities’ of the 1960s and some CNAA institutions had developed broad-based engineering courses with later specialisation. However, most courses have been specialised with courses organised around one of the main branches of engineering over the three years. Taking stock of the situation, the Finniston Committee concluded that: employers had not accommodated to the changing supply routes to professional engineering and failed to provide appropriate continuing education and training; university courses had become overly academic and lacked sufficient application; graduates had uneven quality in their entry skills in maths and physics and gained insufficient coverage of generic engineering skills; professional institutions had been ineffectual in overseeing education and training and should lose responsibilities for professional regulation in order to concentrate on their role as learned societies. Therefore the Finniston Committee borrowed the French term ‘formation’ as a comprehensive term to cover the complete process of producing engineers and to avoid the awkward philosophical and practical hiatus in the English terms of ‘education’ and ‘training’. The aim was to blend theory, application and experience. The Committee was particularly concerned to refashion the old degree: HNC ratio of potential elite and mainstream entrants to the professional ranks in a new idiom, and conceived of a system of registration for engineers with matching educational courses and qualifications. Registration level

Course and qualification

•

•

Registered Engineer Diplomate (REng[Dip]) for those with leadership potential and ability to develop new technologies

A four-year course leading to a Master of Engineering (MEng), recommended for up to 25 percent of the cohort, but with entry determined

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•

Registered Engineer (RE) for the main body of the profession

•

•

Registered Engineer Associate (RE[Assoc]) for support engineers

•

after the first-year performance on the Bachelor of Engineering (BEng) A three-year course leading to BEng, with an emphasis on engineering practice and distinct from science degree courses Educational requirements Higher National Certificate (HNC) or Higher National Diploma (HND)

The Engineering Council was established as the main government response to the Finniston Report. It became the body responsible for the twin functions of ‘professional regulation’ (operating through professional institutions as ‘nominated’ bodies) and acting as the central co-ordinating lobbying body for the profession (what the Finniston Committee had termed the ‘engine for change’). Far from a weakening of their powers in professional regulation, the professional institutions were put in a stronger position. The Engineering Council undertook a review of professional regulation and published a review in 1984, ‘Standards and Routes to Registration’ (SARTOR), with proposals for full implementation in 1992. The Council adopted different terminology and did not follow the proposed Finniston link between education and registration status. The BEng degree became the mainstream route to Chartered Engineer, while the MEng came to be seen as a ‘better’ route, but without any distinct advantage in formal status. Registration level

Course and qualification

•

•

A four-year course leading to MEng, recommended for up to 25 percent of the cohort, but with entry determined the after the first-year performance on the BEng

•

A three-year course leading to BEng or through other pathways, for example HND plus further specialist learning

•

Educational requirements from GNVQ to HNC/HND

•

•

Chartered Engineer is for those engineers whose work is predominantly intellectual and varied, requiring original thought and judgement, ability to supervise and be responsible for the profitable management of industrial and commercial enterprises Incorporated Engineer is for those who perform technical duties of an established or novel character either independently or under the direction of more senior engineers Engineering technician is for those involved in applying proven methods to the solution of practical problems with an element of personal responsibility, usually under guidance

The cumulative impact of changes in course and qualifications in school and further education sectors, coupled with the great expansion of university education, triggered deep controversies about standards in the profession and led to contested proposals for revision in the SARTOR documents in the 1990s. Critics charged that there was a drop in entry standards to higher education and a parallel drop in output standards from university. There are a number of strands

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within the charges about entry standards, including the following arguments: first, that universities have a more varied intake; second, that students from the more vocational BTECH courses do not have as much maths (or as high a standard of achievement in maths) as A level students; and, third, that the old ‘gold standard’ of A levels has been adulterated by changes in content and lower standards in the A-levels themselves. Alongside the argument that ‘more has meant worse’ in entry, critics have argued that there has been a drift in degree classification standards, with the virtual death of the old ‘ordinary degree’ and a massive increase in the proportions included in the higher classifications of the ‘honours degree’.1 From a review initiated in 1991 and a report in 1993, the Board of Engineering Registration (BER) of the Engineering Council has drafted recommendations for a new pattern of registration and educational qualifications which awaits adoption by the ‘nominated institutions’ (that is, by the various professional associations such as the Institution of Mechanical Engineers or the Institution of Electrical Engineers responsible for qualifications in their branch of engineering). Apart from recognising the greater variety in university entry qualifications, the main innovation is the specification of entry standards to courses and qualifications leading to registration. Proposed registration level for implementation in 1999

Proposed Course and Qualification

•

Chartered Engineer

•

•

Incorporated Engineer

•

•

Engineering Technician

•

The study period should increase from three to four years in the educational base. The requirement will be met by either a three-year accredited BEng honour’s degree plus a year of further learning (described as a ‘matching section’) or by a four-year accredited MEng degree. The other change is the specification of minimum entry standards to cover at least 80 percent of the entry cohort: 24 A-level points for the MEng and 18 A-level points for the BEng courses.2 Study will increase from two to three years, involving either a two-year HND and year of further approved study or by a three-year ordinary accredited degree. The entry requirement for degrees is 10 A-level points Advanced GNVQ or equivalent

The specification of entry requirements is something of an interim measure in the move to raise standards, pending more robust accreditation procedures through which the professional institutions approve educational courses. In addition to these more stringent requirements affecting the educational component of eligibility for professional qualifications, the Engineering Council plans to strengthen the review process which covers the second stage of

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formation (termed Initial Professional Development [IPD]). This includes the acquisition of specialist knowledge and skills and the competence to practise in a specific area of engineering and covers training and employment in responsible experience and is judged by a Professional Review. The implicit qualitative dimensions of comparison Implicit in the comparisons of numbers of engineers, there are a number of issues relating to the abilities of the students who enter engineering, the types of institutions which cater for their studies, and the types of abilities with which they emerge. While we have learned not to take numbers at face value, the value which we assign to the numbers of graduate engineers rests crucially on the assumptions we make about the nature of abilities, universities, curricula and assessment. Therefore, we need to turn back to our outline of institutions to see how they work in terms of our three questions. ‘Fair shares’ of the most able students? In both Japan and Britain, university studies in engineering are largely a male preserve. Therefore any comment about the ability levels of student entrants to engineering must be qualified by the caveat that we are speaking almost wholly of shares of the ability distribution among male students. One of the historical legacies of Japan’s determined bid for modernisation in the Meiji period was the creation of universities in which engineering had a prominent place. Since the former Imperial universities have retained a prominent place at the head of a pyramid of institutional prestige and have continued to have a high proportion of their places in engineering faculties, engineering has been able to attract a high proportion of the more able students. Another historical legacy in the Japanese educational system has been the emphasis on examinations to regulate passage from one stage to another. Severe competition for entry to university has been a major factor in shaping the educational system for many years. Some parents have opted for privatesector secondary schooling to secure an easier passage to higher education, particularly where a private secondary school has links to private university. Even parents opting to stay within the public-sector schools are likely to invest in supplementary ‘cram’ schooling (yobiko) which polish core skills for entrance examinations. In the 1980s, applicants to the national and public universities took a common preliminary test (the Joint First Stage Achievement Test) followed by the university’s own test. The First Stage required a competence across five subject areas of Japanese, mathematics, science, social studies and English. Thus applicants, parents and schools could devise a strategy of university applicants to include one or two national universities, a public university and several private universities.

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In addition to cram school support, applicants could improve their aim by taking ‘mock tests’ provided by private testing agencies. These agencies follow up the subsequent destinations of clients and provide a guide to university intake quality. Not only is the public sector of national and public universities judged in a common scale, but the students attempting both national and private universities provide comparators across the university system. Some private universities used the Joint First Stage Achievement Test too. With scores on the examination system standardised, the applicants could learn their personal ‘standard deviation score’ (hensachi). Through the follow-up of past candidates’ destinations they can learn of successes and failures and of the hensachi which would give an 80-percent guarantee of entry to a particular department. While comparisons across the similar departments of different universities can give a guide to ability levels of different universities’ entrants (and of their relative prestige if we assume that the less constrained choices of the more able reflect more general preferences), comparisons of hensachi across different departments within the same university can throw some light on the question of whether engineering gets its fair share of the more able students. While medicine ranks clearly at the top by virtue of the highest scores, the hensachi scores for physics and engineering at the two most prestigious former Imperial universities of Tokyo and Kyoto were virtually identical, and physics was only marginally higher at one of the most prestigious private universities, Waseda. However, the proportion of students studying natural science has been only tiny (3.2 percent) compared to engineering (19.4 percent) in Japanese universities, therefore we can suppose that engineering takes a relatively high proportion of the most able male students. There have been long-standing concerns voiced in Britain that engineering has failed to secure its ‘fair’ share of the more able students. In the early postwar years, engineering was thought to suffer compared to arts subjects, particularly compared to the prestige attached to classical studies in independent schools. Later, engineering was compared adversely to natural science. Comparisons of ability and performance across the full spectrum of discipline in an age cohort are not particularly useful in Britain since subject specialisation in Britain has meant that students have not necessarily carried a common core of exams and grades across the arts v. science range and therefore have been noncomparable. Comparisons in the early 1970s showed that students in degree-level engineering and technology subjects tended to have lower A-level GCE grades compared to those in physics and chemistry subjects (Berthoud and Smith 1980:59). Yet comparisons in the 1980s did not reveal such strong contrasts (McCormick 1988b). However, in contrast to Japan, the proportions studying natural science in Britain have outnumbered those studying engineering lending some substance to the notion that natural science subjects have provided formidable rivalry to engineering studies for able students.

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More recent comparisons have contrasted the 1995 entrants to university study in 96 engineering departments with entrants to 98 history departments (Barry, Bosworth and Wilson 1997:64–7). The 9,605 history students with an average A-level points score of 20.3 clearly outscored the engineering students with an average score of 17.5. However, Barry, Bosworth and Wilson showed the wide spread of A-level academic ability among engineers where the highest A-level requirements were in two of the engineering departments, but many of the engineering departments had students with very low scores (see Table 2.3). The long tail of 37 institutions with an average intake of less than 10 A-level points is consistent with the Engineering Council reports discussion cited earlier and lies behind their attempts to limit the number of institutions offering courses leading to Chartered Engineer status. Is engineering education associated with prestigious institutions? While some might argue that the prestige of a university lies in the eye of the beholder and is a matter of idiosyncratic preference, others try to ground judgements in more systematic evaluations. If we track the institutional preferences of the more able students, on the assumption that they have the least constrained choices, the institution with the highest proportion of able students would come top of the prestige ranking and the pyramid of prestige would be traced through descending levels of measured ability. Despite many caveats about the manner in which ability might be measured or about how students choose universities, or even whether universities might earn prestige along dimensions other than student choices, this approach has a good deal of robustness and common sense about it. Using it, we find that the universities most closely linked with engineering studies in Japan tend to be near the top of the prestige rankings whereas those universities most closely associated with engineering in Britain have tended to be low in the prestige hierarchy.

Table 2.3 A-level points scores for British entrants to university engineering and history (1995)

Source: Barry, Bosworth and Wilson 1997:65

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The emphasis on engineering in the formative period of creating the imperial universities in Meiji Japan has had an enduring legacy. Not all of the 461 four-year universities had engineering faculties, yet they existed in well over half the national universities compared to only 11 percent in the smaller public universities and less than 20 percent in private universities. This pattern was confirmed by student numbers in 1984: the 43,375 newly enrolled engineers in private universities formed only 18 percent of all new entrants to private universities whereas the 24,494 new engineers in national universities represented 28.3 percent of all newly enrolled national university students. Given that only 55 percent of the national universities have engineering faculties, it is likely that engineering students make up over 30 percent of all students in those universities—for example, 38.4 percent at Tohoku University, the third of the Meiji-created former Imperial universities (Kerr 1986:307). Indeed the former imperial universities might well have been called ‘technological universities’ for the prominence of engineering in their programmes. Tables 2.4a and 2.4b show the hensachi scores for public and private universities in 1988 and the clear pre-eminence of the former imperial universities and national universities, together with a sprinkling of some very long-established universities. Updating these tables for the 1990s has become more complicated with the reform measures. The Joint Achievement Test has been replaced by the National Centre for University Entrance Examination (NCUEE) and with some universities offering two test opportunities in the year with different quotas of places on offer at each sitting, we would have to take a weighted average of two scores to establish a mean test score. Moreover, there is a more differentiated curriculum so that we have a further range of scores. However, Table 2.5 gives the hensachi scores identified by one of the major test agencies, the Benesse Corporation. These hensachi scores were established from Benesse Corporation July 1996 mock tests for the 1997 applicants. After statistical examination of the test results, each candidate was given a deviation value. The Benesse Corporation followed up the performance of their test clients in the actual NCUEE entrance exam. These hensachi scores represent the 60 percent pass deviation value. For example, 60 percent of the candidates of the Benesse mock test who had the deviation value of 81 or more had actually passed in the second round of the Tokyo University I (S & E) Faculty in 1997. The pattern of hensachi scores suggests that the broad character of the university prestige hierarchy based on test scores has remained fairly stable since the early 1980s. The top ten ranked universities are still dominated by national universities and include only three private universities. However, a hensachi score of 46, even down to 37, would still secure a university place— but only in one of the lower ranked universities, dominated entirely by private universities.

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Table 2.4a Hensachi scores for engineering entry to public universities (1988)

Source: Fukutake Shoten (1989)3

Table 2.4b Hensachi scores for engineering entry to private universities (1988)

Source: Fukutake Shoten (1989)3

The distinguished educationist, Amano Ikuo, took a rather different approach to the creation of a rank order of prestige, basing it on the degreegranting powers of the universities from doctoral-level to bachelor’s-only universities. Nevertheless, engineering emerged again in a strong association with the more prestigious institutions (Amano 1984). Amano’s fivefold classification of universities into ‘research’, ‘doctorate granting 1’ (granting doctorates in more than one faculty), ‘doctorate granting 2’ (granting doctorates in only one faculty), ‘master granting’ (granting up to master’s level degrees) and ‘bachelor-level only’ correlated closely with the age of the institutions and the more familiar classification by ownership into national, public and private universities; the more prestigious universities tended to have earlier foundations and national universities tended to feature disproportionately among the more prestigious institutions. Engineering was strongly associated with the more prestigious institutions; against the national average of 28.4 percent of undergraduate enrolments in engineering and science,

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Table 2.5 Hensachi scores for entry to science and engineering (1997)

1 Tokyo I, 2 refers to the University of Tokyo, the faculty, and the first or second round of the exam where the university used two entrance exam opportunities. S, E and B refer to Science, Engineering and Biology. 2 The university names in italics refer to private universities. Source: ‘Zenkoku Shuyo 252 Daigaku 465 Gakubu Hensachi (Rikei-hen)’, Sandei Mainichi, 16 November 1997 (List of Hensachi Value Rankings of 465 Faculties in 252 Universities in Science and Engineering)

the research universities had 35.6 percent of their undergraduates in engineering and science and the bachelor-only universities had only 22.1 percent. Using the student qualification approach, Berthoud and Smith, in supporting papers for the Finniston Committee of Inquiry into the Engineering Profession, fashioned a prestige hierarchy for England and Wale which put Oxford and Cambridge at the top and the polytechnics at the base (Berthoud and Smith 1980:60). The relatively large jumps in mean A-level scores from polytechnics to former Colleges of Advanced Technology (ex-CATs) to other universities, to London University, and to Oxford and Cambridge suggested a five-fold classification. My own approach grouped the 36 English universities (responsible for over 80 percent of the UK’s engineers in 1982) into seven types based on their date of foundation and structure (McCormick 1988b). Yet the picture which emerged when the mean A-level scores for engineering students were related to each type was broadly consistent with that of the Finniston surveys. With the exceptions of Cambridge and London University, those universities with the larger concentrations of engineering students tended to be lower in the hierarchy of prestige which ran from ‘collegiate universities’ (Oxford, Cambridge and Durham) through ‘civic universities’ (both the large nineteenth-century universities associated with the large industrial cities and the more mediumsized early twentieth-century universities associated with cities) to ‘new

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universities’ (largely the creation of 1960s expansion) and technological universities (the former Colleges of Advanced Technology). However, there were some interesting differences between the Finniston surveys and my own results. First, the improvement in A-level scores among new entrants noted in the Finniston Report continued so that 1980s students in the samples were on average better qualified than those in the 1973–76 samples. Secondly, the improvement was most marked among the less prestigious institutions so that the gulfs between institutions were becoming narrower, save between the collegiate universities and the rest. Thus the charge that the universities with the largest commitments to technology (the technological universities) had the least prestige appeared to be becoming less true. The elevation of polytechnics to university status has been associated with the debates about standards in university engineering and entry to the profession. The implications of the Engineering Council discussion of revision of the Standards and Routes to Registration (SARTOR) and the prescription of entry levels in terms of A-level points are likely to mean the restriction of MEng and BEng honours degrees to fewer institutions and the likelihood that some institutions will be restricted to courses of study leading only to ‘Incorporated Engineer’ status (Brown 1998). However, after surveying the reported average A-level intake scores among mechanical engineering departments for recent cohorts of engineering entrants, Brown argues that the shakeout among departments of engineering is likely to include some of the larger and older civic universities as well as former polytechnic departments (Brown 1998: 47). It is possible that some employers will ignore Engineering Council prescriptions about engineering definitions and qualifications or that some prospective students will form a market for non-accredited degree courses. However, the likely scenarios are that engineering studies will become more concentrated in fewer universities. Proponents of the proposed reforms are confident that the 6,000-plus numbers applying for the elite-level entry to Chartered Status will be sustained, and reflect a better balance between the elite Chartered Engineers and the main body of Incorporated Engineers. A ‘fitting’ engineering curriculum? Changing our question from ‘does Japan produce more engineers?’ to ‘does Japan produce better engineers?’ would prove difficult to answer, since we would have to judge abilities against expectations in employment. Since employers’ expectations have differed in each country, we would be back with some measure of ‘goodness of fit’. So, although there have been long-standing employer complaints about excessive specialisation in British education and praise for the breadth of Japanese education, these comments have to be set against the kind of occupational roles found in employment. In Britain occupational roles are often much narrower than in Japan. If British employers sum up their hopes for graduates in colourful epithets such as ‘self-starters’ or ‘people who can hit the ground running’, it is hardly surprising that students

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want to focus their efforts narrowly or that educationists will be at pains to introduce more vocationally relevant elements into the curriculum. Another way to answer the question might be to look at the way in which university engineering courses facilitate later professional development. We have seen that Japan’s Ministry of Education, Science and Culture (Monbusho) formerly insisted on breadth in the curriculum, and that this breadth was not confined to the school system but continued into university study. However, the curriculum reforms initiated in 1989 were intended to remove criticisms that general education was simply repetitious of the secondary school curriculum, that student subject choice was restricted by central patterns of required and elective subjects, that new comprehensive subjects were needed, and that more small-group activities were needed in the form of laboratories, practical work and seminars. Calls for much needed reform in Japanese higher education have been predicated on a picture of an ‘uncompetitive university system’ (Sugiura 1995). Behind this image, Sugiura identified three contributory factors: the poor faculty structure, an inadequate infrastructure and an unproductive classroom atmosphere. The structure of the Japanese professoriate has been based on a strong hierarchical career structure which involved much internal recruitment and little cross-fertilisation across institutions, strong control over subordinates’ research by the full professors, and little incentive to try independent paths, given easy tenure once invited. Innovative research has been further cramped by poor physical facilities which ranged from libraries to laboratories and computer equipment. Most of the concern with quality control in Japanese universities has been concentrated on the entrance examination, and there has been little output control comparable to the classification system of British degree results. Thus course assessment has often been left to individual faculty initiative and few tests have been required. Students have been little encouraged to participate in class, nor have they been expected to demonstrate much initiative in project work in their early academic careers. In addition to the curriculum reforms addressed to these problems, another strand of reform has been the encouragement of self-monitoring and self-evaluation in universities (Monbusho 1993:78). Other proposals under consideration include encouragement to foster open recruitment and graduates from other universities or with work experience. However, these changes will occur at the margins of existing university staff and take time to work through the existing stock of university teaching staff. Some of the problems are less acute in engineering departments compared to humanities or social sciences. For example, in many engineering departments promotion has been based on publications in refereed English-language journals, reflecting the concern especially in elite institutions with international standards. Two questions which follow after graduation from engineering courses are: first, do engineering graduates take up engineering employment, and secondly, how does the university study of engineering influence subsequent training and career development?

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It tends to be assumed that engineering studies are (and should be) vocationally relevant and lead to professional employment in ways that the study of, say history, is not necessarily expected to lead to employment as a professional historian. Thus, if engineers do not take up engineering employment then it is assumed that something is amiss. The growing number of graduate engineers in Japan who took employment in the financial services sector, rather than the industrial sector, prompted much debate in industry, universities and government (MITI1989; Muta 1990b). Particular concern was expressed about the employment patterns among master’s-course graduates from the engineering and science departments of prestigious universities in Tokyo (MITI 1989:9). On the one hand, some industrialists reacted with alarm to the claim that if industry did not get its fair share of the able engineers then the future strength and prosperity of Japan’s manufacturing industry might be threatened. On the other hand, some observers argued that the new trend simply reflected a maturing economy, where the growth and diversity of employment opportunities beyond traditional outlets was coupled with technological change as the financial services sector made increasing use of computers and needed engineers. Events after 1990 notably the Japanese stock market crash, the trail of financial scandals involving major Japanese financial institutions and the smoothing of the ripples of financial regulation—moderated the trend (Greenlees 1993). However, the underlying trends appear to favour the increasing attraction of a reformed financial sector in the longer run. For those who reach employment at professional levels as engineers, there is the second question of how well that education equipped them with the knowledge and skills to cope and develop their careers in engineering. One of the main benefits claimed for university education is the encouragement of the higher order skills of learning how to learn. Thus criticisms have often been made that Japanese university engineering education has been heavily lecturebased, involving excessive ‘book-learning’, prompting little active engagement until the third year of ‘professional study’ or the fourth-year graduation thesis (Rawle 1983; Deiters 1992). However, reforms have been directed towards tackling these problems, particularly those concerned with the development of graduate schools, in a system where graduate education has been widely developed only in the engineering field. Engineering and science have been singled out for priority treatment (Monbusho 1995:123). Reform of the regulations covering the passage from undergraduate to master’s and doctorate courses will speed the arrival of an engineering doctoral graduate into a company laboratory. The standard timescale of the four-year bachelor’s, twoyear master’s, and three-year doctoral course student has meant entry to employment at age 27 for a typical graduate. It has tended to mean that the doctoral course has been largely the reserve of intending academics. While another route to a doctorate for industrially based engineers has existed (sometimes attracting praise for the industrially relevant character of work submitted for the doctorate) it does little to add young researchers with research skills and fresh perspectives to industrial R&D. Monbusho has tried to increase

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the appeal of doctoral research for graduates and the attractions of doctorate graduates to industry by introducing ‘fast tracks’ to graduation—for example, permitting able third-year bachelor’s students to transfer to master’s courses and by permitting master’s course students to transfer to a doctoral course after one year. After pilot schemes had been introduced at the University of Tokyo, the University Council has recommended that these schemes should be extended to able students in other universities (Monbusho 1995:123–4). However, there is concern that any extension of the ‘fast track’ system should be accompanied by more rigorous and more scrupulous application of course tests to curb the student search for easy passages (Clark 1998). Other proposed reforms have been aimed at the inertia of university organisation by recommending that external bodies conduct objective appraisal. Such proposals from the University Council are intended for the national universities in the first instance, with the hope that they would be adopted subsequently in private universities. Meanwhile the current distinctions between national and private universities might become blurred if proposals for the transformation of national universities into autonomous corporations are adopted for 2005 (Atoda 1997). These proposals have been driven more by wider political and financial considerations, to streamline ministries and reduce public debt, than academic considerations. However, they might facilitate the other efforts to break down institutional rigidities in the universities and enable them to develop more stimulating and competitive academic environments. Meanwhile critiques of the narrowness of British engineering education have been associated with admiration for the breadth of Japanese engineering education. The Finniston Committee found deficiencies in both the education and employment of engineers in Britain: the education system tended to produce too many introspective and narrowly educated engineers who had poor communication skills and narrow conceptions of their role who subsequently found a narrowly circumscribed employment. Similar comments on the narrowness of engineering curricula and the failure to encourage communication skills by either oral discussion or essay work have been repeated in other studies (Barry, Bosworth and Wilson 1997:70–4). The Committee’s solution was to advocate a conception of the ‘engineering dimension’ at both the national and company levels. At the national level this entailed a new body to act as an ‘engine for change’ in engineering and to give a more effective voice for engineering interests than that possible with the existing professional institutions. It meant an attempt to give an enhanced role for employers and a somewhat diminished role for professional institutions in the accreditation of engineering courses. At the company level the Committee relied on enlightened self-interest guiding companies towards the design of more closely integrated operations in which engineering considerations would permeate the company. The government’s response to the Finniston Report itself in 1980, and the failure to shift from professional self-regulation to state intervention through the establishment of a statutory body and national register for professional engineers, has been interpreted

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as an indicator of the British political system’s poor capacity for radical innovation (Jordan & Richardson 1984). However, these outcomes were not necessary features of the British political system but reflect a number of contingent factors (McCormick 1985). To some extent the employer complaints can be interpreted as complaints about the change in their labour markets and their inability, after the expansion of degree-level studies, to buy in their semi-trained staff with practical skills from the old ‘practical route’ to engineering. In this particular case it has been argued that the expansion of degree study opportunities meant that students switched away from HNC study towards courses leading to a degree; meanwhile the use of traditional universities as models of excellence by the Council for National Technological Awards (NCTA) from 1955 to 1964 and the Council for National Academic Awards (CNAA) since 1964 has pulled these institutions into the traditional mould and failed to compensate for the loss of engineers who previously came through the ‘practical route’. The university-based Conference of Engineering Professors accepted much of this criticism; ‘many students are pursuing engineering degree courses for which they are intellectually unsuited. These give them only an uncertain grasp of the theoretical aspects of engineering science, while failing to equip them with skills which would be more valuable in professional engineering practice’ (CEPC 1978:23). The extent to which British engineering graduates are lost to industrial careers has been the subject of much speculation. One large-sample survey of recently graduated engineers in Britain found that although 70 percent of the respondents planned to enter industry, only 35 percent intended to pursue careers as professional engineers, and that the factors impeding the choice of engineering careers were largely based on direct observation and experience of industry, including disenchantment with assignments and rewards (Industry Ventures 1989). Similar reports of mal-utilisation among young engineers have been found in other surveys too (Barry, Bosworth and Wilson 1997:92–5). The social standing of engineers Curiosity about the relative ‘social standing’ of engineers has been another prominent theme of comparative studies of engineers. However, the term ‘social standing’ is something of a generic umbrella term covering a variety of social rewards (from relative monetary rewards to social prestige) and contexts (from within companies to the wider society beyond the workplace). Not surprisingly, social scientists have taken a variety of approaches to study the social standing of engineers. Yet a common underlying notion is how much power and influence engineers wield in a company or society. Thus, if engineers are highly rewarded, whether in terms of pay or social prestige, then it is assumed that their views hold sway in boardrooms and debating chambers. Moreover, high rewards will attract the more able of a nation’s talent into their ranks. In the context of debates about relative economic rise or decline and the widely acknowledged

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role of engineers in those processes, the ‘social standing’ of engineers has been taken up as one of those key indices. Thus, comparisons of where engineers fit into the reward systems of industrial societies have been prompted by both the intellectual curiosity of sociologists involved in their discipline’s core tradition of studies of social stratification and by more policy-oriented research on the recruitment and retention of engineering staff. Substantively, it has been widely assumed that Japanese engineers enjoy high social standing and often asserted that British engineers suffer low social standing. The alleged low social standing has been pictured as both the cause and consequence of Britain’s long-standing relative economic decline: low rewards reflect the poor regard for British engineers by industry and society, the more able tend to be attracted to the better rewarded professions, engineering fails to secure its fair share of talent and a less talented profession fails to secure a more successful industry and its just rewards. This portrayal of lowly esteem has become almost axiomatic in accounts of British engineers. It is often matched by wistful glances at engineers in other countries and coupled with some wishful thinking. In the 1980s, earlier comparisons with engineers in Western Europe gave way to comparisons with Japan. Thus against the low salary, status and career prospects of British engineers, we were offered images of the high salary, status and career prospects of Japanese engineers. Coupled with the alleged prominence of engineering studies in the Japanese educational system, the picture was one of Japanese engineers rising on a virtuous circle in Japan contrasted to British engineers trapped in a vicious circle. A further Government policy is education. Japan places a heavy emphasis on all aspects of applied science and engineering. Over half of her 601 universities are dedicated to science and engineering. This is matched by correspondingly high salary, status and career prospects for engineering graduates. In Britain there have been some moves in this direction but they are at best, half-hearted. (Lawrence and Lee 1984:184) However, these bold images of both countries begin to fade when subjected to precise scrutiny. The examination of Japanese higher education did not reveal 600 universities, nor was there much evidence that half of the 465 identifiable universities were in any sense ‘dedicated’ to science and engineering. In the examinations of pay, prestige and careers, Japanese engineers did not appear to have enjoyed historically higher relative rewards compared to graduates with educational backgrounds in law or economics. Even in more recent pay comparability surveys in Japan (Chapter 5), private-sector engineers were not distinguished by relatively high rewards. Whether the focus is put on starting salaries or life-time earnings, surveys fail to support the notion of engineering as a particularly favoured promotion path or route to high earnings differentials in Japan (Kinmonth 1986:400–3). Attitude surveys among engineers reveal that, while the Japanese engineers are almost unanimous in feeling that they

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have made a significant contribution to the development of Japanese society, the majority of engineers feel that their rewards are not commensurate with their contribution (Okubayashi 1989:30–1). Using a large survey of graduates from a university engineering department, Okubayashi found that over half of his sample of engineers perceived that ‘chartered accountants’ enjoyed a higher social status than engineers and only a small minority thought that engineers had a higher social status (Okubayashi 1989:32–3). When the focus was put on rewards within companies, a quarter of the engineers saw their rate of remuneration and career progress as lower than that of non-engineering graduates in white-collar company roles, while over half of the engineers thought that they had similar rates of remuneration and career progress. Only a tiny percentage of the engineers felt that they had higher rates of pay and progress. Discussions of the social status of British engineers are often treated to much anecdote and little precision regarding both ‘engineer’ and ‘society’. However, Okubayashi’s survey gave a clue to a more precise target for British engineers’ complaints when he distinguished between social status in the wider society and social status within the company. In the company, he found that Japanese engineers tended to feel that their opinions were taken seriously in top management, and that engineers in production departments were even more positive in their responses than those in R&D departments. Moreover, Japanese engineers tended to have close contact with blue-collar workers in terms of frequency of communications, but, more importantly, they held very positive views of blue-collar workers as co-workers, and he concluded that this close relationship had facilitated the design of flexible working systems in Japanese industry. However, if Japanese engineers have not enjoyed all of the high rewards and social standing which some British observers have supposed, have Britain’s engineers suffered the low rewards and social status? In Chapter 1, there was evidence of a long history of commentaries on the low social status of British engineers, attributing it variously to the persistence of pre-industrial culture, the timing of industrialisation, the successful capture of the educational system by anti-industrial literary intellectuals, the opposition of craft unions, and so on (Landes 1966; Weiner 1981; Barnett 1977, 1986; Glover and Kelly 1987). However, these observers have not had it all their own way. Other observers have argued that far from a uniformly low social status throughout Britain’s industrialisation, we have to explain the rise and subsequent fall of engineers. Two rather different versions of this approach both implicate engineers in their own downfall. In one version, engineers oversold their wares—particularly electricity in the late nineteenth century—and suffered public disenchantment, while in the other version, engineers proliferated their representative institutions and their divided house fell (Cardwell 1972; Watson 1976). Even the argument that British engineers have lacked championship by the state has been sharply rebuked by Edgerton’s account of the Ministry of Supply and the aircraft industry (Edgerton 1991, 1996). Whatever the validity of the earlier images of

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the engineer as the Cinderella of British industry, there was evidence of a more upbeat situation emerging in the early 1980s, continued in the 1990s. Although there had been a lengthy litany of surveys reciting the low social standing of British engineers (Gerstl and Hutton 1966; Fores 1971, 1973), there was evidence of improving career prospects and rewards in the late 1970s. Two central problems in the surveys—the extent to which pay surveys used matched properly matched samples and their interpretation—have been vigorously debated (Child, Fores, Glover, and Lawrence 1983, 1986; McCormick 1985, 1986b). My own view is that some observers had become too deeply attached to the traditional images and unmindful of change among engineers, changes affecting even those engineers working in the production areas alleged to be the most maligned by a hostile British culture. Salary surveys commissioned by the Committee of Inquiry into the Engineering Profession under the chairmanship of Sir Monty Finniston showed clear evidence of an improving situation for engineers in production, while further corroboration came in the salary surveys of the Council of Engineering Institutions (McCormick 1986b: 615–17). More recent surveys have added further challenging evidence for the ‘low status thesis’. The 1997 Engineering Council survey shows an engineering profession very much at ease with the image and substance of the engineering profession, with engineers ready to recommend engineering careers to their children (Engineering Council 1997). The notion that ‘accountants run British industry’ and that engineers are blocked from access to top management has been doubly challenged by economists’ analyses of industrial careers and economic performance (Barry, Bosworth, and Wilson 1997). In their survey of British manufacturing industry, Barry, Bosworth and Wilson distinguished between the ‘unqualified’ and ‘qualified’ managers. While half of the managers proved to be unqualified, that half of the managers who were ‘qualified’ were further distinguished into ‘qualified scientists, engineers and technologists’, ‘qualified accountants’ and ‘other’ (or non-technical graduates). The QSETs (‘qualified scientists, engineers or technologists’) outnumbered the accountants among the 43,000 top executives by a ratio of approximately three to one. However, two stings in the tail of the report were: first, there has been a more rapid increase in the proportion of qualified executives who were accountants, and second, that companies headed by accountants outperformed companies headed by scientists, engineers, and technologists, not just on financial indictors but on operational indicators too. Such findings do not give succour to those who argue that more engineers are needed to transform British industry. Insofar as companies are beginning to favour accountants, the performance evidence suggests that rational argument is on their side. The capacity of engineers to transform capitalist industrialism has been a long-standing interest of sociologists, back to Veblen’s critique of profligate waste in capitalism (Veblen 1921). The issue has been approached through studies of the location of engineers in the class structures of industrial societies. Emphasis has usually been put on the ambiguities of the engineers’ position

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between capital and labour. On balance, studies have tended to portray engineers as identifying themselves with managers, the agents of capital. The investigations and debates on the class location of engineers in Japan have largely been conducted within a classical Marxian framework document. These accounts of social stratification in Japan demonstrate the striking changes in Japanese society and the rapid nature of those developments since 1955. The ‘peasantry’ (47 percent) was more than double the size of the ‘working class’ (23 percent) in the labour force in 1935 (Ohashi 1971:23). Despite the large movements of labour into factory production during the war and the changes in agricultural production following land reform under the occupation, the peasantry still outnumbered the working class in 1950 (Morioka 1989: 142). Yet with the burgeoning economic growth after 1955 the peasantry’s share in the labour force fell from 37.7 percent in 1955 to 8.3 percent in 1985. On the other hand the share of the working class climbed up from 43.6 percent in 1955 to 69.4 percent in 1985 (Morioka 1989). In very broad terms, Ohashi’s social statistics illustrate the transformation of Japan in the post-war period into an industrial economy with a waged labour force. However Ohashi’s treatment of engineers proved controversial because he put engineers along with other professional and technical workers into the ‘working class’ as part of the ‘labour aristocracy’. The numbers of professional and technical workers in the employed labour force grew from 1,906,000 (4.8 percent) in 1955 to 6,097,000 in 1985 (10.5 percent). Although the absolute numbers of craftsmen and production workers increased over the same period (from 9,488,000 to 18,127,000), they fell over the 1970 to 1985 period as a proportion of the labour force from 32.2 to 31.2 percent of the labour force. Projections of the labour force to 2000 suggest that the professional and technical labour force will continue to grow markedly. Within the census category of ‘professional and technical workers’, the engineers were the second largest group, after the medical and health workers. Over the years between 1970 and 1985 the number of engineers increased from 701,040 to 1,444,900. In contrast to Ohashi, but still within the Marxian tradition of class analysis, Steven re-worked the census data using a ‘middle class’ of those in contradictory class locations. In Steven’s analysis, the hallmarks of ‘technocrat’s’ involvement in the capitalist production process are their possession of above-average skills which enable them to gain more control of their own work situation and to participate in the control of the work situation of others (Steven 1983:124–5). Drawing on his own fieldwork survey Steven noted the problems in assigning the graduate-level technocrats to class locations when the majority held supervisory responsibilities by the age of 30 (Steven 1983:135). Thus Steven concluded that it was ‘almost impossible to separate technocratic control over the means of production from the managerial hierarchy’ (Steven 1983:136). Using a battery of questions about the control of labour power, participation in decision-making, and abilities required of their rank Steven determined that all those at or above the rank of supervisor (shunin) should be assigned to the

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bourgeoisie or capitalist class, a long way down the managerial hierarchy (Steven 1979:8). Where Steven was critical of Ohashi’s over-generous assignment of engineers to an over-large ‘working class’, Morioka was critical of Steven’s over-generous assignment of engineers to the ‘capitalist class’ (Morioka 1989:157–8). Morioka argued for a significant break-point at section manager (kacho) since below that level engineers in the managerial hierarchy would have little discretion in entertainment allowances or participation in capital accumulation. Using survey data on compensation in private industry by occupation, Morioka sees the division manager (kakaricho) and supervisor (shunin) as much closer to the labour aristocracy of the working class than Steven. Despite their inclusion of information on authority relations, on decisionmaking and on rewards which shed light on class relations at the point of production, the Steven and Morioka analyses are essentially static and neglect the dynamic element introduced by considerations of context and career. Thus anticipation of career promotion and ascent in the managerial hierarchy conditions the conduct and aspirations of graduate engineers on entry to the corporation. Graduate engineers emerge from an educational system which emphasises theoretical knowledge and de-emphasises practical problems and specialist identifications. They pass through engineering assignments in employment on their way to the managerial ranks in an employment system which has cultivated continuous training and the exchange of benevolence for loyalty. The career line provides the temporal thread of continuity between engineers’ and managers’ interests which is overlooked in more static analyses. Of course, there may be occasions and contexts in which feelings of ‘them’ versus ‘us’ might be expressed in the language of a ‘class’ or an occupational group, for example in the heady excitement of the annual wage round bargaining (shunto). However, the prospects for a serious and sustained critique of the capitalist organisation of production are distinctly limited. Other studies of engineers in the stratification systems of industrial societies have owed more to Weber than Marx. The Columbia University team of researchers focused on two kinds of industry (‘low technology’ and ‘high technology’) and three countries (France, Britain and the US) (Silver, Zussman, Whalley and Crawford 1979). Their inquiry was stimulated by the contrast between two different approaches to the new technical stratum. On the one hand, the functionalist or liberal ‘professional model’ viewed the engineeremployer conflict in terms of the professionals’ stress on autonomy for technical judgement versus the employers’ stress on bureaucratic authority. On the other hand, the ‘new working-class model’ viewed conflict in terms of the cosmopolitan commitments of technical workers versus the bureaucratic demands of capitalist enterprise, and saw engineers as a new potential challenge to capitalism. Within each country, the Columbia researchers put a strong emphasis on authority at the point of production to explore the different perspectives, selecting one company in the older metal-working industry (typified by small ratios of engineers to other employees and low levels of

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R&D) and another in the electronics industry (with high ratios of engineers and high levels of R&D). At each site, the researchers interviewed approximately 40 engineers, conducted field observation and gathered contextual information on the companies. In the British study, Whalley found that engineers in Computagraph, the high technology site, characteristically were often recruited from the external labour market, worked in teams, enjoyed high status and pay, were involved in their work, and watched the external labour market for nature career opportunities. By contrast, engineers in Metalco, the low technology site, could be drawn through an internal labour market that permitted skilled manual workers to advance into more advanced technical roles and management and, characteristically, they had less autonomy, lower pay and status. However, engineers in both sites identified with companies and had little solidarity with manual workers (Whalley 1986:148–50). Whalley concluded that engineers were part of the ‘service class’, although he preferred his own terminology of ‘trusted workers’ for those who exercised a high level of discretion, were paid monthly salaries, and enjoyed relatively secure positions with the prospects of careers. In looking at the contrasts between the British engineers with their American and French counterparts, Whalley emphasised the strength of employer control over the system of recruitment and training of British engineers, whether the new entrants come as school-leavers and enter the mix of employment and part-time education or as graduates into low-level technical job (ibid.: 187). The uncertain public image of engineers in Britain was attributed to the low differentiation from other technical workers, while engineers were seen as belonging to the same labour market as managers. By contrast, French engineers were more sharply distinguished by their education in elite engineering schools and their entry to a career in the cadre. Thus French engineers began their careers higher up the ladder, typically supervising technicians, and with better long-term prospects than British engineers (Whalley 1986:188–90; Crawford 1989). The American system was mid-way between the French and British, for although positions were more strictly bounded than in Britain, mobility could be achieved through education courses and qualifications (Whalley 1986: 190–1; Zussman 1985). Whalley traced these differences in the organisation of engineering recruitment and careers to the historical context and terms on which employers in the three countries had been able to recruit their engineers as ‘trusted employees’. In France, early state support for elite engineering institutions with their theoretically oriented curricula encouraged recruits from the middle class, whose background meant that they could be trusted. In the US, employer influence over the professional engineering school produced curricula infused with business values and practical orientations. Unable to secure broad middle-class support, Whalley argues that British employers used in-house education and training schemes to secure their ‘trusted’ engineers, and so retained an emphasis on the ‘craft’ model. However, Whalley conceded that the expansion of the educational route into engineering was producing change and an erosion of this craft tradition (Whalley 1986:197–8).

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Conclusions Three problems can follow from the exaggerated quantitative comparisons in building national league tables of engineers. First, alarmist comparisons can lead to precipitate and ill-considered policies. Secondly, setting Japan up as a quarry for stones to throw in domestic arguments can lead to neglect of reform debates in Japan and likely changes in the role model. Thirdly, in the longer run, the exposure of inflated claims can discredit all comparison with Japan and, in throwing out the baby with the bath water, risk losing some of the more interesting comparisons. When Japan’s economic growth first provoked the attention of interest groups in the Western economies, the results were akin to ‘moral panic’ with exaggerated claims for the education system’s output of engineers. Japan was rapidly put to the top of the international league tables of engineers and used as a stick to beat governments and education systems for industrial and economic failings. Despite their dubious basis, some of the early and wild comparisons appear to have been used to dramatic effect to influence education policy—for example, in the ‘switch policy’ to boost engineering places in universities and polytechnics in Britain. However, over time, Japan appears to have been treated to more careful scrutiny, partly because the early claims were easy to deflate and partly because government statisticians had interests to defend. The result has been to move attention to a range of questions about more qualitative aspects of comparing the output of engineers from education systems. Nevertheless, before leaving the narrow numerical comparisons, it is worth reaffirming the awesome aspects of growth in Japan’s post-war education system. Producing double the number of British engineers per head of population has been an impressive achievement. It was not done at the expense of squeezing arts and social studies numbers. It was done by moving to a mass higher education system and carrying ever larger proportions of the age group on to higher stages of education. The large absolute numbers of engineers are the outcome (and modest proportion) of a very large system. Moreover, despite quibbles about the maintenance of quality in universities and junior colleges, there has been little doubt about the quality of students performance when judged in international comparisons of school-age students. However, there are two related aspects to note in the qualitative comparisons. Engineering education has been strongly associated with the more prestigious institutions in Japan and it has attracted a relatively high proportion of the more able male students. This combination should not lead us to assume that engineering per se attracts the more able students. It might just mean that studying engineering simply maximises one’s chances of entering a more prestigious university. One of the most striking contrasts between the two different national systems for producing engineers is evident in the British concern with social prestige, reflected in the concern with standards in university education, and the role of

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the professional associations in pressing reform. In Japan, the prestige of universities and departments is left to the workings of the education and labour markets. The professional associations hold no role in course accreditation and no sanction over individual engineers in registration. Ultimately, while there is a discussion of elite and mainstream engineers in terms of educational standards of master’s and bachelor’s degrees, the determination of an occupational elite rests with employers. One attractive feature of the Japanese system to overseas observers has been the apparent broad agreement on the division of labour between academics and employers on respective responsibilities for education and training. Allowing educators to concentrate on cognitive skills permitted a broad curriculum which laid a base for subsequent industrial training. However, Japan has been changing. The University Council, established in 1987, has several reports urging reform at both undergraduate and graduate levels. The main reforms at undergraduate level have been the attempts to generate more plural admissions criteria for university entry and the abolition of the regulations on subject areas. The removal of the requirements for general education, foreign languages and physical education will leave universities free to devise their own curricula. How they will exercise their new discretion will be matters for future research. At graduate level, reforms have been aimed at achieving greater degrees of flexibility in graduate schools—for example, in the purpose, admission criteria and duration of study. It remains to be seen whether the possibilities to expand ‘professional studies’ and to develop ‘fast track’ routes to postgraduate degrees will be readily taken up across Japan’s universities and whether they will have the result that a greater proportion of Japan’s engineers will have a pattern of engineering education more similar to that in Britain than in the past. Notes 1 ‘Honours’ degrees in British universities are often contrasted with ‘pass’, ‘ordinary’ or ‘general’ degrees, where these three latter terms are treated as synonymous. The main feature of the ‘honours’ degree is the higher level of specialisation than in the pass degree. The award does not reflect high marks but a distinctive course with a high level of specialisation, usually entered at the outset or at the end of the first year. Candidates for honours degrees are graded into classes of degree on the basis of marks, while no grading is put on the pass degree. Thus the aim of the Engineering Council is to counteract the alleged ‘grade inflation’ by setting intake quality standards in addition to a requirement for a specified level of honours degree for membership. 2 The ‘points’ are a numerical conversion of the grades awarded on the Advanced level of the General Certificate of Education (GCE A-level). The points scores for the letter grades are: A= 10; B=8; C=6; D=4; E=2. Thus a score of 24 could be achieved by three grade-B passes or another combination. 3 Fukutake Shoten is a distinguished publisher of educational materials and organiser of educational projects, including prepatory seminars and classes for university entrance examinations. The full table of university hensachi scores is included in company publications as a guide for potential clients.

3 Engineers and the lifetime employment system

‘…the evidence indicates that the price paid by the Japanese for OJT and the great commitment they make to communication requires them to employ at least twice as many development engineers, for any particular purpose, compared to a British company.’ (Lorriman 1986:576)

Introduction Do Japanese companies invest more in training their engineers than British companies? What difference does the lifetime employment system make to the education and training of engineers? Interest in answers to these questions grew rapidly in Britain in the 1980s as part of attempts to address the complaints that British companies invested too little in training their labour force and that poor levels of knowledge and skills were important factors in the relatively disappointing economic performance of the British economy. It was widely expected that Japanese companies would be found to invest more in training, and the ready explanation was that Japanese companies would invest more in their employees since they would recoup the benefits from lifetime employees. On closer inspection, however, many of these discussions turned out to be circular re-statements of what were largely assumed to be self-evident truths. It was largely an article of faith that Japanese companies would spend more on training their employees than their British counterparts (Gregory 1984:53; Coopers and Lybrand 1985). This air of plausibility was logically consistent with the success of Japanese companies in world markets for manufactured goods and what was known of the ‘lifetime employment’ system (IMS 1984; Handy 1987). It seemed intuitively obvious that employers would invest more in employee skill development if they could be confident that they would harvest the fruits of their investment. Yet attempts to test the proposition of greater investment and to document these international differences found that Japanese companies recorded smaller training budgets and lower expenditures than their British counterparts (Dore and Sako 1987; Wersky 1986). So, if the intuitively obvious answer is not borne out by the available evidence, where does one turn for an explanation of the links between company training and employment systems?

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One pointer, quoted above, from John Lorriman, is to look beyond the training budget at the payroll. There, Lorriman contended that, for any given task, the Japanese companies would have to simply employ more people in order to cover their favoured ‘on-the-job training’ (o-j-t). Unfortunately, Lorriman did not give us any detailed comparative examples of tasks or analyses of labour budgets. In the fuller report of his visit to Japan, he only referred to conversations with Japanese engineers and managers. The matter is just left as one of impressions, albeit those of an experienced British engineer and training manager from one of Britain’s largest electronics companies. However, although Lorriman did not give tangible evidence of employment effects, his comments were useful hints at likely answers to the opening questions about relative investment in training. One needs to go back a step and re-think the nature and purpose of training in the context of a different employment system. If much of the training provision comes in the form of on-the-job training where it is difficult to distinguish training from job instruction and to assign costs, then one must examine the more qualitative indicators and examine the interaction between training and several other aspects of business and employment strategy. Once the differences in employment systems are acknowledged, we can see why differences in training effort will not be revealed by differences in training budgets (Dore and Sako 1987:60–1). In arguing that the lifetime employment system has had a significant influence on the way in which Japanese corporations develop their graduate-level engineering manpower resources, I want to advance the following propositions: • The lifetime employment system has had a major impact on the recruitment and selection policies of companies. In particular, I shall argue that the system encourages the concentration on entry ports to the companies immediately after graduation, a preoccupation with potential for development rather than readily applicable skills, the use of the educational system as a filter to identify such potential, and attempts to develop long-running relations with universities as part of the recruitment process. • The lifetime employment system has shaped the locus, content, mode, and agencies of training and employee development. Here I shall argue that the system emphasises a preoccupation with company-specific knowledge and skills and hence a preoccupation with in-house training, that it lays stress on the importance of making new recruits into company members and hence it lays stress on organisational skills, that it uses on-the-job training as the main mode of training and that it uses line managers as major agents in human resource management. • The lifetime employment system has deeply influenced the pay and promotion system in the large Japanese corporation. Here I shall point up the links between the lifetime employment system and the weight attached to seniority in the pay system and the links with the rank promotion system. • The lifetime employment system has reinforced the business strategies of the large Japanese corporations. In particular I shall argue that the commitment to

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the principle provided a very strong stimulus to the strategies of organic growth and innovation.

The lifetime employment system Most attention to the impact of the lifetime employment system on skill development has tended to assume that its main impact has been to generate a larger volume of training and skill development without looking closely at its impact on the nature of training philosophy and practice. Before taking up these issues the character of the lifetime employment system must be clarified. Lifetime employment has not meant ‘employment for life’ nor did ‘system’ mean that all Japanese workers operated within its terms. The concept has caused such confusion that some have preferred ‘long-term employment’ rather than ‘lifetime employment’ (Trevor 1983:37). The terms are not specified in any contract for that would offend against earlier rejections of feudalism, rather they exist as a moral expectation of loyalty in exchange for benevolence. The terms and coverage have not been static but have changed over time (Fruin 1978:273). Currently we can say that the lifetime employment system means entry to employment directly on graduation from school or college, a strong moral expectation of employment from that sole employer until retirement, continual training, and mandatory retirement at 60, after the increase of mandatory company retirement from 55 to 60 (Inagami 1983). In the 1980s, lifetime employment covered about 85 percent of the labour force in a large corporation and at most 30 percent of the total national labour force. While some British company recruitment brochures have advertised opportunities for long-term careers, in Japan a sufficient proportion of the labour force has enjoyed the expectation of lifetime employment to justify speaking of a ‘Japanese Employment System’. Moreover the small firms, which have found the practice difficult, have recognised lifetime employment as a norm to which they aspired. The argument about the impact of the lifetime employment system on training can be illustrated by material drawn from literature surveys and interviews with personnel, training and engineering managers in 15 Japanese companies and interviews with researchers in universities and government departments concerned with education, training and employment in the autumn of 1984. This material was compared and contrasted with a parallel set of interviews with personnel, training and engineering managers in nine British companies in the summer of 1984. These interviews in companies ranging across the electronics, process and engineering industries focused on how the company human-resource strategies interacted with company business strategies in a dynamic situation (see Table 3.1). Table 3.1 illustrates the variety of Japanese companies in terms of industry, scale of activity and R&D intensity (from the research-intensive electronics to the public utilities), and recent financial experience (from the successful electronics companies to the ailing chemical companies in the process sector).

Sources: Shinposha (1984); Annual Reports; Company Interviews

1 Graduate engineers. 2 Financial data for A, G and H are for 1983.

Table 3.1 Financial structures, company performance and labour force data for a sample of Japanese companies

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Already by the 1980s, there were strong pressures which were undermining the capacity of companies to sustain the expectations associated with the lifetime employment system. These pressures have become more pronounced in the 1990s. On the one hand the ageing of the labour force makes seniority-based wages more expensive to bear, and on the other hand trade friction constrains the possibilities for continuing growth and promotion. As Japan has reached the technological frontiers in some areas and expanded the base there are pressures for a different pattern of career development, closer in style to that available in the large British companies. These are issues to which we shall return after outlining the links between lifetime employment and the training of engineers in the recent past. Recruitment and selection The main implications of the lifetime employment system for the regular employees of large corporations have been to: • heighten the importance of recruitment at the entry posts to the company from the educational system • encourage a long-term perspective on recruits so that they are selected on the basis of their potential contribution rather than their currently employable knowledge and skills • favour the use of educational qualifications as important indices of the capacity for learning and skill development • facilitate the development of long-term relations between the recruiters (the companies) and the providers of graduate manpower (the university professors). A further consequence of the lifetime employment and the heightened importance of recruitment, selection, and training has been to make the personnel department into ‘one of the most powerful and prestigious departments in a typical Japanese corporation’ (Pucik 1985:16). In a system which has emphasised the immobility of regular employees, recruitment to the large corporations came to focus on the graduation points from the educational system. With the enormous expansion of the participation rates in the 1960s and 1970s only 5–6 percent of the age group became available at the end of compulsory school-leaving at 15; as a result recruitment is concentrated on the upper secondary school, the five-year technical college, and the four-year university. The scale of this regular annual activity is illustrated by the figures for the electronics company E (Table 3.1). This company recruited 850 male graduates mainly from the national universities and leading private universities and 80 percent of these recruits came from engineering and science backgrounds. In addition they recruited a further 200 female graduates from the four-year universities and two-year junior colleges, mainly from scientific and engineering backgrounds, for work in software engineering. They recruited

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a further 150 male engineering and science graduates from the five-year technical colleges—that is, students who had completed the equivalent of the three years of secondary schooling and two years of junior college within a technical college. At the most junior level, that is among 18-year-olds, 500 male graduates were recruited mainly from the technical streams of upper secondary school. This scale of recruitment among 18-year-olds was unusual for a large company since it was more usually delegated to affiliates which undertake more of the production activities. Another unusual feature of this company’s recruitment was the additional 100 experienced recruits for graduatelevel posts. This aspect was attributed to business pressure in the electronics sector and the company’s success and growth. However it was regarded very much as a second-best option and the main disadvantage of mid-career recruitment was alleged to be the lack of control over quality compared to the recruitment of a fairly standard product among new graduates. This diffidence about external recruitment was illustrated in company J, a glassmaker, which had 200 engineers and scientists working in two R&D laboratories and which has an annual recruitment of 50 engineers and scientists (30 for R&D, 10 for product development, and 10 for production engineering in the production divisions). Despite the anxiety of this long-established company to develop its R&D capacity, it had to be done in a manner consistent with company traditions. One important change in the last few years has been the recruitment of experienced people. We expect 10 people in R&D this year and 20 more next year. The aim is to minimise the time it takes to develop new R&D. Among the new university graduates the pattern is changing, in the past it used to be non-organic chemists with few electrical engineers and physicists whereas now we want organic chemists, electronics engineers, physicists and some other scientists. It might be possible to recruit from the aluminium company in the Group, since they are in difficulties. Recruitment from external sources or outside the Group is very sensitive. The people coming must bring no problems for us in relation with other companies. I do not think that the company would engage in aggressive marketing for staff. (Personnel Manager, Company J) External recruitment brings not only the internal problems of kitting the recruit with local knowledge in a system organised around internal labour markets and a seniority pay system, but also fears of the acrimony between companies which would flow from head-hunting. Nevertheless, the needs to build R&D capabilities, to undertake diversification programmes, and to recruit in shortage areas are prompting companies, such as the ceramics company (K in Table 3.1), to declare their new external recruitment policies in their annual reports.

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In addition to yearly scheduled recruitment of college graduates, the company intends to welcome capable technical minds from other corporations and research laboratories in order to enrich the company’s research and development capability. (Annual reports, Company K) Lifetime employment means that the potential for development among recruits is of far more importance than evidence of readily applicable skills. This implies acceptance by companies of a much sharper division of labour between companies and universities, with universities concentrating on the fundamentals of engineering in the context of general education and the provision of training by the companies. The pattern of engineering education in the four-year universities has borne a strong resemblance to the American pattern. Such similarities are not surprising given the determination of the US occupation to democratise education through opening access and emphasising general education for citizenship and the subsequent visits of American engineering educators as advisers (Hazen 1952; Dees 1997). However, the academic streams were becoming more general in the pre-war school system. There was some employer concern about vocationalism in Japan in the 1960s and this prompted the creation of over 60 five-year technical colleges; subsequently the state created two more vocationally biased universities to provide more peak institutions for the technical stream. In the 1980s, Toyota created an industrial college to take only students with work experience. The point of these examples lies mainly in their claims to be unique in swimming against the overwhelming tide of Japanese higher education. The difficulties were so formidable that Toyota Technical Institute subsequently modified its recruitment policy to admit senior high-school leavers without industrial experience. For most of these companies the main purpose of graduate recruitment even of engineers and scientists has been to fill the ranks of company management. Graduate scientists and engineers were expected to transfer into management posts in R&D or other functions during their forties. Although this pattern may be changing in the electronics and chemical companies the traditional pattern was still evident in the gas utility, company O (Table 3.1). The graduates are considered essential for the responsible positions in the company—they are the cadre of the company. They are promoted to management and therefore very few are going to be specialists in R&D for life. They spend their time going back and forth between operations. (Personnel Manager, Company O) The importance of potential rather than actual skills is further underlined by the stress in recruitment criteria on social acceptability and the ability to work in teams and by the delay of allocations to first work assignments until completion of a substantial part of the training programme. For example, in company B, with an annual recruitment of 700 to 800 graduate engineers and scientists, there was little

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expectation of links between courses and projects at the bachelor’s level and early work assignments. At the Bachelor level what is learned is very basic and carries very little implication for early assignments. We do not allocate them to specific job assignments until after six months and they are still within the two-year training programme. The Master’s level people enter the same training programme but we would expect more of their experience to be directly useful, perhaps a 30 percent connection. The Doctor Engineer is different where research is much more important and we will recruit from 20 to 30 at Doctor level each year. (Engineering Manager, Company B) The use of educational qualifications as a means of occupational selection meant that a fiercely competitive approach developed in the highly selective educational system of the 1920s and 1930s (Passin 1965). The democratisation of access to higher education advanced by the US occupation in the 1940s and the educational expansion of the 1960s did not reduce the competition but translated the competition on to a much larger scale in a mass higher education system. The glittering prize of entry to the lifetime employment system remains the driving force of an educational system which produces between two and two-and-a-half times as many graduate engineers per head of population as Britain and which appears to draw on a higher proportion of the more academically able male students than Britain. Companies have traditionally conceived the role of Japanese universities as essentially suppliers of manpower and rather than as suppliers of research. With democratisation after 1945 there has been a widespread belief that the examination system has been meritocratic (Rohlen 1983). Confidence in the efficacy of the educational system as a talent sorting system has reinforced the tradition of the most prestigious companies recruiting at the most prestigious universities with second-rank companies recruiting at second-rank universities, and so on. In a system where the universities have operated as talent filters, complaints are not straightforward complaints about shortages by discipline or specialism but shortages by university since the university has been the guide to skill level. We know the relative difficulty of getting into a particular university because there is a uniform entry qualification to get into a national university. For X university we know that they need an 80 percent score in mathematics and that is one kind of assurance. We know that if they have a good academic performance they have some ability. (Engineering Manager, Company M) Thus in company L, a company manufacturing components for the auto industry (Table 3.1), there was a strong reluctance to move down the university quality ranking in order to recruit shortage disciplines. Companies are trying various kinds

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of substitution within the given ability band, for example substituting women for men in software engineering. We do not specify the numbers rigidly by specialism because the supply is fixed. There are about 70,000 engineers each year and all the other companies are competing for them. The Japanese universities are ranked into five groups. We try to recruit from the top two groups which produce about 12,000 of the total output of engineers. Sometimes we go down the universities but not much. In the software area the shortage is most acute so we try to increase the number of women, both engineers and nonengineers. They are mostly at Bachelor level, for example there are 60 this year (1984) of whom 40 are in software. (Engineering Manager, Company L) The sense in which supply is fixed stems in part from the inertia of the traditional pecking order of universities, the better funding, facilities and staff-student ratios of the national universities, and the difficulties in moving resources within the system from declining to growth areas. In addition, inelasticities in supply stem from the peculiarities of the long-term supply relationships which companies seek with universities and the pivotal role of professors in allocating students to companies (Azumi 1969). These large companies used to operate a system of ‘designated universities’ but this roused objections from the private universities and the Ministry of Labour on the grounds of equality of opportunity. Formally at least anyone can now apply to any company. However, invitations or ‘bids’ are sent to the university engineering professors who allocate students to companies: the professors will restrict the number of introductory letters that they write and such letters are accepted without question in the case of the prestigious universities. In essence the professors share out their graduates to known companies. The advantages are clear for ‘top’ companies and ‘top’ universities for the universities supply a standard product from a known source. There are some disadvantages however. The homogeneous background of recruits might have served well for product innovation but may be less appropriate for invention and the new direction in R&D in Japanese companies (Sakakibara and Westney 1985). The system is difficult for companies which seek to move into new technologies or seek to expand their intake of particular disciplines. For example, the chemical companies had well-established recruitment channels for chemical engineers but had few contacts with the electronics professors and so felt very restricted in their efforts to recruit electronics engineers to aid their application of electronics to their existing chemical technology and to aid their business diversification programme. Such constraints are part of the stimulus to the growth of the external recruitment of experienced engineers from other companies. Of course companies have a range of strategies to establish new relations, for example through the provision of research grants, equipment or contacts for advice. Once contacts are made and once some recruits trickle to the company then alumni groups are used to make further direct contact with students directly and recruitment patterns

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reinforced. For keiretsu companies, there has been another channel to secure new technologies and engineering skills through group companies wellestablished in their technologies either by loan or transfers agreed between companies. Large British companies also attach importance to their regular recruitment from universities and colleges for it constitutes a regular and reliable concentration of buyers and sellers of labour in the market. There is certainly a hierarchy of prestige in British universities and it is clear that the high academic abilities of Cambridge and Imperial College intakes, as measured by A-level exams, are attractive to company recruiters in the sense of an academic filtering system, but the hierarchies have been less clear-cut than in Japan. Moreover there are some notable differences in the way in which companies approach the graduate labour market. Although they offer the possibilities of a career with the company and recruitment brochures will spell out examples of careers within the company, there is much more emphasis in the British companies on identifying specific jobs to be filled at recruitment (‘direct entry’ is promoted both as offering the challenge of ‘real work’ after years of study and as the best means of learning). In contrast to a graduate apprenticeship where the new entrant would be on the training budget and the responsibility of the personnel department, the direct-entry graduate becomes the responsibility of an operating department and fills a vacancy in the departmental labour force. Here training (whether on or off the job) is at the discretion of the departmental managers and their interpretation of departmental needs. Sponsorship of undergraduate scientists and engineers during their period of study, unknown in Japan, has grown considerably in Britain and the advantage claimed for it is that it offers companies an extended scrutiny of potential recruits and it means that new recruits are already familiar with company operations on entry to full-time employment. In addition to these direct approaches by companies to the graduate labour market, companies have successfully lobbied for changes in undergraduate science and engineering education, in an attempt to make it more vocational and to equip graduates to make an effective contribution to companies at the commencement of their employment (Finniston 1980). Training and assignments The training programmes of the Japanese companies varied in their scale (given the variations in the scale of recruitment), in their length (from one to two years), in their content (given variations in industry and market sector), and in their degree of formality. Yet some common themes emerged in the emphasis on making ‘organisational members’, the use of on-the-job training, and the importance attached to line managers as trainers. Typically all recruits started on the same day with two to four weeks of induction. The contents and style of these induction programmes varied, but a typical pattern included: lectures by senior management on company history,

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‘company spirit’, and company operations; courses on communications, computer programming, and English conversation; and visits to establishments. The point about the senior management involvement was not the quality of the information imparted but their symbolic importance and visibility to the new recruits. The bulk of the subsequent training period was organised as ‘o-j-t’. In some cases this period of assignment to a senior engineer and supervisor was proceeded by rotation—for example the engineers might go to production establishments for a month while administrative recruits went to accounts. Another variation was to include some further elements of off-the-job training —for example, one of the process companies included a week of computer programming, quality control, and patent procedures. In each company, however, the core of training was seen in the relationships of the trainee, senior engineer and supervisor. Although companies could produce elaborate charts of training provision along the career lines of company employees (often in English) they were at pains to emphasise that the core of training was through o-j-t, that this was very informal and ad hoc, and that there was no ‘grand plan’ for its conduct. This is clearly seen in the comments of an engineering manpower development specialist in one of the chemical companies: Building group skills is very important. It is mainly done through o-j-t. The supervisors give the bits and pieces—there is no organised programme. The group leaders are not rewarded in any special way—it is just part of their obligation. In the Japanese working environment engineers seldom work alone—they are usually working in groups. Therefore leadership and the human skills are very necessary, and we tend to take it for granted that these skills will be passed from seniors to juniors. (Engineering Manager, Company G) Although there may have been no formal plan, these comments indicate three general principles which are crucial to the organisational socialisation of Japanese engineers through o-j-t: first, the senior-junior relationship; secondly, the obligations of management towards training their subordinates; and thirdly, the importance attached to group working. From his study of organisational socialisation in a bank in the early 1970s, Rohlen drew attention to the importance of ‘senpai-kohai’ (senior-junior) relations, a basic dyadic relation which carried the image of ‘“friends”, one ahead and the other behind, passing along the same path of endeavour’ (Rohlen 1974:197). As an image of an ideal working relation found in the general culture it forms a strong buttress to the beneficial support which older, senior and more experienced engineers can be expected to give to younger, junior and less experienced engineers. In a society which has retained a strong sense of hierarchy, juniors can be expected to listen. In addition to the support of senior engineers the new recruit can expect the close involvement of the supervisor. Misumi underscores the link between the

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lifetime employment system and the importance of managerial responsibilities for subordinate training: ‘Under the Japanese system of lifetime employment, the superior’s leadership includes not only performance-oriented leadership but also educational leadership in that the superior is supposed to provide his subordinates with training’ (Misumi 1984:531). Sakakibara and Westney went somewhat further in suggesting that the relative weights attached to technical and performance-oriented skills and those attached to interpersonal skills in Japanese R&D laboratories are the inverse of those in US R&D labs (Sakakibara and Westney 1985). Attempting to highlight the scope and importance of supervisor responsibilities for training, Lorriman and Wersky claim that supervisors in the large electronics corporations spend up to 30 percent of their time in training subordinates (Lorriman 1986: 575; Wersky 1987:71). Moreover, Lorriman expresses a British training manager’s belief that British line managers do not spend nearly so much effort on training activities (Lorriman 1985:88). The involvement of management in training is not exhausted at the completion of the two years’ training nor is this the end of training project assignments and report presentations, for these continue as a feature of ongoing up-dating and training. The large corporations cannot take it for granted that the building of group skills is a spontaneous process; it is an enormously time-consuming affair which extends far beyond what might be considered normal working hours. The new recruits live in the company dormitories. The patterns of socialising built around drinking parties and company recreation facilities are testimony to the efforts to build group solidarity (Rohlen 1974:190–1). Recalling his experiences as a visiting engineer attached to a Japanese company Bhasanavich noted how difficult it was to spend any time alone or away from work colleagues (Bhasanavich 1985:73). It is tempting to accept the explanation that this is simply Japanese culture, organising work patterns consistent with the culture of a ‘group oriented’ society (Nakane 1970). However, there is another aspect to this frantic socialising—the need to police conduct in a lifetime employment system. Under a lifetime employment system the company and workgroup must guard against the potential ‘shirker’ and ‘free rider’. Using the concept of ‘mutual monitoring’, Aoki suggests that effective policing is provided by the system of long-run evaluation, the payment system and ostracism for offenders (Aoki 1987:66–7). Thus an important aspect of initial training lies in providing both the cognitive skills of interpersonal relations and the internalisation of the norms of appropriate conduct, or ‘right attitudes’. Large Japanese companies are well aware of the problems of passivity, complacency and the ‘tepid environment’ which might be induced by the ‘lifetime employment system’ (Takagi 1985:2). Therefore Japanese companies and management have to work very hard at delivering the full terms of the quid pro quo. Gregory has commented that ‘in Japan corporate technical training has become a surrogate for the university graduate school of engineering’ (Gregory 1984:55). The context of comparison was Japan v. US and it underlines the

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relative paucity of graduate study in Japan. All of the large companies had schemes for sending staff to graduate programmes in the US, where the companies bought into the professionalism and high technology of American graduate schools and bought an international education which will be helpful to their internationalisation plans. As indices of company investments in training, Gregory’s statistics on company colleges or overseas postings can be misleading as to both the form and content of that training—they are better regarded as the tip of an iceberg of training. While the lifetime employment system carries the corollary of continuous training over the working life, the main forms of training in Japan are through on-the-job rather than off-the-job training and a good deal of the content consists of learning organisational skills and not just technical updating. Through providing courses equivalent to the final honours year of a British undergraduate engineering course the companies can provide an updating programme for existing staff (Gillan 1985). In addition, self-development programmes have provided an important avenue for training. For the most part, these programmes have not been the glamorous high tech of video-disc but have looked much more like the prosaic style of correspondence course texts (Dore and Sako 1987:69). Perhaps the most impressive aspect of the training system in Japan is the way in which companies manage to elicit a high commitment to skill formation and the manner in which self-improvement is pursued as a moral crusade. It is presented as the quid pro quo of the moral commitment made by companies to lifetime employment. Companies take on the responsibility for developing the careers of their employees and line managers bear heavy responsibility and involvement in the process of training their subordinates. While this aspect of management began to attract more attention from Western observers in recent years, Hirschmeier and Yui noted that it has a lengthy tradition dating back to the very beginning of the lifetime employment system in the period 1900–18 (Hirschmeier and Yui 1981:207). In Britain, there was a strong impression that the volume of training carried out by employers fell during the 1970s even for engineers in manufacturing industry. For example, the Finniston Report cited the demise of the great engineering companies which had been famed for their apprenticeship schemes (Finniston 1980:85). The Finniston Committee saw the professional institutions and the training board system as unable to stimulate effective training. On the other hand the electronics companies claimed that there had been a change towards a more effective form of training through the provision of ‘direct entry’ and training on the job. In addition they claimed that through vacation student work, sandwich course students, sponsored students, and training on the job for new recruits they carried a very considerable burden of training. Clearly one of the problems to disentangle is whether the differences between the British direct entry/training on the job mode and the Japanese o-j-t are semantic, perceived or real. Training by o-j-t attempts to provide structured learning experiences: it includes a progression of tasks from the relatively easy to the more difficult

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along with experience; it links progression to internal promotion; rotation is planned so that progression involves a broadening of the range of tasks as well as a deepening of task complexity; and it is expected that close supervision and support is given by supervisors and more experienced workers. This form of training is buttressed by the emphasis on group work such as ‘quality circles’ or ‘ability development’ circles. It is the lack of structural support which suggests that all too often ‘direct entry’ offers the shadow rather than the substance of o-j-t. Pay and careers It has often been asserted that the relatively better performance of Japanese manufacturing owes much to the higher rewards available for Japanese engineers in pay, careers and social status. These rewards were thought to enable engineering companies to attract able and highly motivated engineers. Plausible though the argument might sound, it is difficult to substantiate. The operation of the lifetime employment system has meant that all official wage statistics are collected in terms of size of firm, gender, education, age and length of service. It is extremely difficult to identify an occupational group to back up any bold claims about the existence of high rewards, still more so their effects as motivators. Such indirect evidence that we can find suggests that engineers are not particularly well rewarded by pay. More plausible is the argument that companies, having adopted lifetime employment policies for regular workers and having tried to blur the white/blue-collar distinction, try to operate with relatively low differentials in order to emphasise the image of the team in corporate life. In 1984 the major Japanese electronic companies were paying a common starting salary of ¥136,000 per month (see Table 3.1). Despite all the complaints of shortages of electronic engineers the companies did not compete on starting salary. The chemical companies showed more variety and paid a somewhat higher starting salary at ¥143,000 to ¥146,000 per month (see Table 3.1). Thus the companies tend to pay near the industry average and the common British variations by class of degree, subject degree or skilful impression management in interview are noticeably absent. Japanese engineering graduates do not claim any particular expertise—they are bright people available for company development over a working life. Even the master’s-level graduates, so eagerly sought for the R&D laboratories, tend to be paid only at the level of a bachelor with two further years of experience. If there is a small premium it tends to be justified on the grounds that they are bright people rather than that they have acquired research training, although some companies concede that the master’s course does offer further experience of project work. The ‘seniority wage system’ has been dubbed the economic basis of the lifetime employment system. Typically, recent graduates were given relatively small and undifferentiated starting salaries, followed by wage increases in line with their years of seniority or length of service. Employers were seen to be

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reluctant to recruit expensive, experienced recruits compared to relatively cheap new graduates, particularly if the much-prized organisational skills tended to be organisationally-specific, and employees were thought to be reluctant to abandon the prospects of enhanced rewards which came with continued service, particularly when increasing rewards were likely to be needed for the increasing family commitments. While seniority-based pay had an appeal to a culture which took age-grading seriously, there was a strong economic rationale while stable imported technology meant that seniority and experience were good proxies for increasing competence. More rapid technological change has weakened the economic rationale and the increase in job-related and performance elements have prompted speculation about the end of the seniority-based pay system (Magota 1979). Marsh and Mannari gave examples of how the introduction of job classification began to enhance the position of the 25-year-old graduate with three years’ service relative to the 25-year-old manual worker with 10 years’ experience (Marsh and Mannari 1976:129). Thus contemporary pay systems are a blend of ‘seniority wage’ (i.e. based on age or length of service and educational background) and ‘ability-based pay’ (i.e. an evaluated ability grade based on personnel appraisal of knowledge and ability) (Ishida 1986). Beyond basic pay a number of allowances for family or housing could add a further 10 percent to pay. A further incentive to skill acquisition comes in the form of the midsummer and year-end bonus which are additional to monthly pay and can account for 30 percent of annual earnings in the large corporations. Although the annual negotiations with the enterprise union are intended to tie workers into identification with overall company performance, there is an individual performance-related element. The supervisor rating of performance, which can include judgements about attitudes too, can count for plus or minus 20 percent of bonus pay in some companies. While there is some flexibility in this system for identifying potentially very able engineers through the ability element and their performance through the merit element of bonus, the magnitude of both are often tied closely to enterprise union agreements. Even in 1996, seniority could still count for 70 percent of an engineer’s contracted pay and the scale of bonus was regulated by union agreement. It is not until kacho level, perhaps after 10 to 15 years in the company, and leaving the union-regulated ranks, that the company has a freer hand in rewards. Getting a fix on engineers’ salaries in Japan is very difficult: official statistics seem designed to suppress occupational consciousness. The Ministry of Labour’s ‘Basic Survey of Wages’ records salaries in terms of education and age, but not occupations. However, a clue to the career-linked pattern and relative pay of engineers can be gleaned from surveys undertaken by the National Personnel Authority (Jinji ‘in), a body which carries out comparability surveys of pay in the private sector in order to guide public-sector pay determination. By looking at job clusters and sectors, we can get an indirect guide to engineers’ pay and the two issues which are of prime interest: first,

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confirmation of the age and seniority aspects of pay related to lifetime employment, and second, whether engineers stand out as a particularly wellpaid and highly regarded occupational group. Confirmation of the importance of age and seniority can be seen in Tables 3.2 and 3.3. Table 3.2 draws on the National Personnel Authority surveys and shows job clusters by four departments in the larger private-sector companies: research departments (typically employing university graduates in engineering and science), technical departments (typically employing university graduate engineers), office departments (with graduate white-collar workers), and mechanical departments (to illustrate typical blue-collar workers) (National Personnel Authority 1996). The table illustrates job clusters along the promotion path from basic grades (aged 32 to 35) to section manager (typically promoted around ages 44 to 47) and department head (typically occurring around ages 48 to 51); however, lifetime employment and seniority wages have meant some small pay increases even for non-promoted employees. Looking across the rows, we can see the pay profile from the mid-1970s to mid-1980s and the effect of age and seniority by taking the 20- to 23-year-olds as the index base of 100 in each cluster. Table 3.3 provides data on the significance of seniority from 1975 to 1995, by looking at blue-collar workers in manufacturing industry and two groups of university graduate white-collar workers, one group in manufacturing industry and the other in the finance and insurance industries. Taking the 20- to 24year-olds as the base index for each group, we can see that the university graduates have a much steeper age-wage profile and tend to peak at a later stage (50 to 54) compared to blue-collar workers. The relative standing of engineers in the manufacturing industry has to be approached indirectly through data drawn from the National Personnel Authority survey in Table 3.4. Here the job clusters are shown by age group with the university graduate office worker and career line serving as the index base in each age group. Engineers can be found in both the R&D departments and the technical departments, and their fortunes vary by department. The R&D department has topped the pay league in all age groups (except the youngest 20- to 23-year-olds) and in nearly all years across the two decades, 1975 to 1995. While the younger engineers (age groups 20 to 23 and 32 to 35) in technical departments might appear to have been ahead of their humanities and social science graduate peers in the office departments, the later career stages at section head (kacho) or department head (bucho) show a reversal of fortunes, where at section head they fall from 99 percent in 1975 to 95 percent by 1995. The image of engineering in Japan, sometimes held up in Britain, as a particularly well-rewarded occupation in Japan (especially close to production) does not appear consistent with this salary data (Rebick 1990). While we cannot isolate engineers as an occupational group in the Ministry of Labour ‘Basic Wage Survey’, we can examine some issues relevant to engineers. Tables 3.5 and 3.6 present indices of manufacturing industry’s male white-collar workers who are university or college graduates in comparison

Source: Based on National Personnel Authority Survey on Earnings in the Private Sector in Itoh et al. 1991:126

1 Indices based on 100 for the monthly contractual earnings of workers in all job clusters and in the 20–23 age group.

Table 3.2 Differences in monthly contractual earnings by age group

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Table 3.3 Differences in annual cash earnings (bonus included) by sector, education and age group (males)1

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Table 3.3 Differences in annual cash earnings (bonus included) by sector, education and age group (males)1 (continued)

1 Indices based on 100 for the annual cash earnings of workers in all job clusters and on the 20–24 age group. Source: Rodosho 1996

with two other groups; first, compared to manufacturing industry’s blue-collar workers (Table 3.5) and to the finance and insurance industry’s white-collar university or college graduate level labour force (Table 3.6). Since the twiceyearly bonus forms such a large proportion of annual income, the right side of the tables show a clearer picture of income differentials. Table 3.5 shows that bonus effects put blue-collar employees on relatively higher incomes at the earlier stages of working life (20- to 24-year age group), but thereafter the white-collar employees have much steeper profiles. However, we can see that the differentials have narrowed over the two decades when we compare the 25- to 29-year-olds and 50- to 54year-olds in 1975 and 1995, where the differential rose to over three times the blue-collar rate in the earlier period but dropped to two-and-a-quarter times by 1995. Perhaps the more interesting comparison lies with the graduate white-collar labour force in the finance sector. While the manufacturing workers have been below the finance group for most of the period, save among the 50-year-olds, the differential has moved even more strongly against the white-collar workers in the manufacturing sector across the whole 25- to 50-year-old groups in the late 1980s

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Table 3.4 Differences in regular monthly salary by job cluster1

1 Indices based on 100 for the regular monthly salaries of office workers/managers in each age group. Source: National Personnel Authority annual

and 1990s. This salary trend illustrates the relative salary issue underlying that concern and the debate about the tendency for increasing numbers of able engineers to join the finance sector discussed earlier in Chapter 2. Promotion has been not only an incentive to training—it has often been the occasion of training. Promotion comes through advances in job classification where the jobs are classified into ranks. The rank titles which derive from ‘nenko joretsu’ (ranking by years of service) have a widely understood currency in Japanese society (Trevor 1983:49). More recently the titles have become part of an ability-based management system which has been extended from blue-collar to white-collar staff (Inagami 1983:16). After arrival in the graduates’ entry grade, the new engineer becomes eligible to enter the next grade after three years in the Nippon Kokan steel company. Subsequent upgrading within a rank will depend on the collection of a target number of points in annual performance reviews. Promotion across ranks, however, depends on meeting the minimum preparation period for upgrading and passing a screening examination by management. In this system the existence of maximum preparation periods does guarantee some promotion for all up to the management levels, while the more ambitious can gauge their progress against the standard preparation periods. At section chief (kacho) and above the links between rank and office-holding become quite close, but below that level, that is for the first 10 to 15 years of the graduate engineer’s company career, the Japanese system of ranks permits promotion through the ranks without a necessary assumption of office. There is a system in many companies through which individuals can express

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Table 3.5 Wage differences by job cluster: male white-collar workers (university or college graduates) in manufacturing industry1

1 Using the earnings of male blue-collar workers in manufacturing industry as base 100 in all age groups. Source: National Personnel Authority annual

Table 3.6 Wage differences by job cluster: male white-collar workers (university or college graduates) in manufacturing industry1

1 Using the earnings of male white-collar workers, university or college graduates, in finance and insurance industry as base 100 in all age groups. Source: National Personnel Authority annual

their preferences about job assignments, rotation and off-the-job courses but the prime responsibility for career development rests with the company. Again there is a sharp contrast between career development in these large Japanese corporations and British policy and practice, although the contrasts tend

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to be at their sharpest in the decentralised British electronics companies rather than in the chemical companies. Through the British pay system there is constant checking that starting salaries and subsequent pay are competitive with rival bidders for graduate engineers. With job evaluation as the basis for the grading structure the newcomer is advised that individual salary progression is determined by job grade (an evaluation of the job being done) and performance rating (an annual assessment of performance by a supervisor). Company handbooks emphasise that salary is not related to age. Promotion involves a move to a new job and its associated salary, and again the emphasis throughout recruitment literature and interviews is on ‘the ability of the cream to rise to the top very quickly’. And the company literature emphasises that the onus for career development rests on the individual, albeit with the supportive interest of the company. Lifetime employment, business strategy and in-company training It has become conventional wisdom in the human-resource development literature to argue that firms must explore the implications for their human resources of their business strategies (Glinov et al 1983). Equally, it has become conventional wisdom in the technological innovation literature to argue that firms in the advanced industrial countries should adopt the business strategy of ‘moving upmarket’, adopting international best practice techniques and the promotion of industrial innovation, particularly as they lose earlier comparative advantages to follower nations (Pavitt 1980, 1981). In the case of British engineering and engineers, the Finniston Committee of Inquiry into the Engineering Profession tried to pull these two strands together, arguing that their advocated strategies of business and technological innovation implied new structures of engineering organisation and that these new patterns of organisation carried further implications for new skills and training among Britain’s engineers (Finniston 1980:17–39). In essence, the Committee argued that companies producing traditional products by traditional methods with traditional skills would meet increasingly severe international competition as their earlier comparative technical and commercial advantages were eroded. Therefore they argued that companies should move upmarket by paying attention to the ‘nonprice’ factors in competition—for example, performance, reliability and ‘general fitness for purpose’. These factors are the hallmarks of ‘design’ and the core of good engineering at the professional level. The Finniston arguments were not simply for more and better engineers, however, because they recognised that the engineers need to be organised in appropriate organisational structures. The emphasis was on the need to integrate and balance research, design, development and production and their linkage to the company’s market strategy. Avoiding the compartmentalisation of functions implies a market awareness and engineers equipped with a set of technical and organisational skills which enable them to cross organisational boundaries. Thus a narrow education and training might

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imply a narrow role conception and a failure to develop the appropriate organisational structures, whereas a broad education and training carries the possibilities of broader role conceptions and better integrated structures. There is the further issue of where engineers might learn these broader organisational and technical skills and develop the broad conceptions of the engineer’s role. For the Finniston Committee there was no doubt that they should be learned in the workplace and they would involve a strong commitment to continuing education: ‘…flexibility in the development of engineers requires that the engineers are equipped for wide “non-technical” responsibilities and most employers believed that these wider skills were generally acquired most effectively “on-the-job”’ (Finniston 1980:39). The steps in the argument are fairly clear, from business strategy to business organisation to skill requirements to a policy on engineering manpower resource development strategy and practice. It is a logical flow which is even charted with arrows in the Engineering Council Consultative Document on Education and Training (Engineering Council 1988a). Within the framework of capitalist economic activity it seems unexceptional that business strategy should determine human resource development strategy or that all undergraduate economists should learn that the demand for labour is a function of the demand for the product. In his account of the training of Japanese engineers within their companies, Wersky opened by ‘placing the engineering formation process within the context of Japanese industry’s commercial requirements and business policy’ (Wersky 1987:3). Titled Training for Innovation, Wersky’s account emphasised that the pattern of training followed from the innovation strategies of the large electronics companies. He shared with the Finniston Committee a common intellectual heritage in the work of the Science Policy Research Unit on technological innovation and a common didactic enthusiasm to urge British industry to adopt more technical-innovation-based business strategies, to undertake more R&D, and to put higher priorities on the recruitment, training and deployment of graduate engineers in the enterprise (Wersky 1987:3; Finniston 1980; Pavitt 1980). While this approach correctly draws attention to the influence which flows from business strategy to engineering manpower resource development strategy, it neglects the reciprocal influence of employment strategies on business strategies. For example, it neglects the structural peculiarities of Japanese capitalism, in particular the balance of interests and stakeholders in the large Japanese corporation, which give such a strong emphasis to employment practices, and hence impetus to business strategies. Without wishing to turn conventional wisdom completely on its head by arguing that Japanese firms determined their employment practices first and that the business strategies flowed from the earlier decisions, I want to emphasise the very powerful and positive feedback loop which employment practices have exerted on business strategies of growth and innovation. If we start from the proposition that business enterprises are coalitions of interest groups who act as stakeholders pressing a variety of goals on the enterprises, then we can see that the ownership and financial structure of the

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Japanese enterprise, together with the practice of lifetime employment, have given a distinctive cast to Japanese corporate capitalism (Dore 1987). Two points stand out about the ownership and financial structure of the large Japanese corporations: firstly the shares have tended to be held by other companies (often business affiliates or associated companies) or banks and insurance companies rather than individuals; and secondly, the companies have been ‘highly geared’, that is, they have had a high ratio of debt, typically bank loans, to equity (Table 3.1) (Clark 1979, Kiyonari and Nakamura 1980; Abegglen and Stalk 1986). The net effect of these features has been that Japanese corporations are more insulated from shareholders than their British counterparts, and that they have had more scope to consider the long-term view urged by advocates of the innovation strategy. Now if the ties between shareholder and corporation are weaker in the Japanese case than in British counterparts, the ties between regular employees and the corporation appear correspondingly closer because of the lifetime employment system. The lifetime employment practice has given a powerful stimulus to the growth objectives of Japanese corporations, to the strategies of innovation and organic growth, and the preoccupation with market share as the measure of success. Three mechanisms have linked lifetime employment to organic growth objectives: • Board members tend to come through the management ranks of the company as lifetime employees and strongly identify with the company (Shirai 1983:374). By organisational socialisation and current structural relations these board members are sensitive to the pressures of their middle management and regular employees (Kono 1984). • Under the lifetime employment system the middle management and regular employees are keenly interested in growth in order to satisfy their aspirations for career and salary advancement within their own company. • Growth by acquisition is both difficult and problematic with this distinctive pattern of ownership and employment system. Table 3.1 shows two aspects of the financial structure of the Japanese sample survey companies. Firstly, the equity or gearing ratio shows the relatively low reliance on equity compared to loan finance in Japanese companies. Secondly, the shares tend to be held by banks or dispersed among the companies which tend to be members of the same group. The pattern of share dispersion makes acquisition difficult, and while acquisition might increase earnings per share it does not necessarily increase the number of posts for employees. Moreover, there is not only the potential problem of harmonising another company’s lifetime employees with one’s own, there is a possibility that the enterprise union can be a rallying point for opposition to an attempted acquisition (Kono 1984; Abegglen and Stalk 1986). Japan provides many examples of companies which have grown by diversification based on technology—for example, Casio started as a manufacturer of calculators using integrated circuit technology, then used the

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same technology to enter the watch market with quartz digital watches and the music market with electronic musical instruments (Hara 1982; 21). Some contrasts could clearly be seen in the background to this research in the commitment of electronics companies in Britain and Japan to link computers and telecommunications. Fujitsu started as a telecommunications company in the 1930s, became famous in the post-war period as a computer manufacturer and now seeks to put these two aspects of its business together. While both NEC and OKI Electric were similar broad-based electronics companies seeking to promote the computer-communications link in their business strategies, the British telecommunications company STC was seeking to acquire a computer expertise through the purchase of the computer manufacturer ICL. At the same time the GEC company was seeking to add to its telecommunications business through the takeover of the Plessey company. Historically it appears that the lifetime employment system was first adopted as a solution to industrial relations problems in the 1920s (Dore 1973; Littler 1982). This pattern became more widespread and was reinforced as an employer response to the very difficult and turbulent industrial relations problems of the early post-war years. For some companies at least, resolving labour market strategies had priority over product market strategies, partly because product market problems were less pressing because of government support and partly because the flexed muscles of restored unionism made labour market problems particularly pressing. The synthesis of product market and labour market strategies which has come to be seen as the Japanese company model did not mature until the 1955–64 period (Okamoto 1982:41). Japan’s success in the period of post-war recovery and the later high growth period (1965–75) was largely noted for the success in advancing its share of world trade and the pattern of company-related, incremental innovation in the mass production industries (Hull, Hage and Azumi 1984a). To a considerable extent these innovations were developed in the process of buying in foreign (especially US) technology, reverse engineering it, and improving it. Given this context of technological development, the Japanese companies did not develop the specialised R&D laboratories separated from production departments with all the attendant problems of co-ordination described so clearly in the British case by Burns in the 1950s (Burns and Stalker 1966). Instead the Japanese companies put their talented engineers into production areas, whether in production R&D or in production roles either permanently or as part of rotation policy (Hull, Hage and Azumi 1984b). This pattern of emphasis on production, reverse engineering and incremental innovation is graphically described in Halberstam’s comparison of Nissan versus Ford (Halberstam 1986: 263–318). The contrasts between the Japanese and US automakers in the relative proportions of engineers and accountants employed and location of a greater proportion of the Japanese engineers in the production areas were supported in more quantitative studies too (Cole and Yakushiji 1984). While the absence of distractions such as aerospace or nuclear industries greatly aided the ability of mass-production industries to recruit talented engineers,

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the practice of lifetime employment was a crucial factor in enabling those engineers to promote incremental innovation successfully. For Aoki, these innovations and productivity improvements rested critically on an organisational model characterised by horizontally co-ordinated information flows and semi-autonomous and localised problem-solving. In other words, teams of talented generalists (engineers and operators) could take responsibility for the problems to hand and devise group solutions across departmental and functional boundaries (Aoki 1986). In a further development of this model Aoki spelt out the supporting role of the lifetime employment system and the pattern of incentives based on seniority wages in fostering the capacity of work groups to share information and achieve joint understandings on mutually relevant technology. The lifetime employment system has been a device to encourage ‘team oriented learning by doing’ and the seniority wage system has encouraged the acquisition of the knowledge and skills necessary for communicating effectively with others, in comparison with systems based on rewarding specific and narrowly defined job performance (Aoki 1987:63– 5). Japanese employment practices and human resource development strategies appear to have served large companies well while the main strength of Japanese industry has been in incremental innovation in the national quest to catch up on the US. However, doubts have emerged about how far contemporary organisational patterns and human resource development strategies will suffice as Japanese companies seek to pioneer new technologies and develop strategies for radical innovation. The changing context of the lifetime employment system Although we have seen that the lifetime employment system has underpinned some characteristic differences in the education, training and employment of Japanese engineers compared to their British counterparts and although we have seen that some differences have been plausibly linked to past business successes, there are a number of pressures which are leading to modifications in the system of lifetime employment. Moreover, these changes will carry implications for the systems of engineering manpower resource development operated by companies: • The ageing labour force, trade friction and slower growth in the world economy mean that the lifetime employment system is becoming both more expensive and more difficult to maintain. Therefore companies have been reducing the proportion of offered lifetime employment, flattening the rate of salary increase for older workers, and trying to devise alternative career routes to compensate for the reduced management promotion opportunities (Akaoka 1974; Kuwahara 1986). For example, in company B, new recruits could expect their first major promotion to assistant section chief after 10

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years in the high growth era, but by the 1980s it was expected to take 12 to 13 years. However, in the 1990s many more middle-aged workers in a range of companies are being told that there is no prospect of promotion within their company and that they should accept transfer to another company. Employers are trying to keep faith with the notion of secure employment by organising either temporary transfer to another company (shukko) or a permanent change of employment (tenseki). Typically, these changes are transfers organised among groups of companies which have trading or other business relations (Sato 1996). It seems clear that lifetime employment is increasingly being redefined in terms of long-term employment with a group of companies rather than a particular company. Much less clear are the implications for the moral quid pro quo between employers and employees, whether the weakening of employment security will weaken the commitment to education and training, and acceptance of technological and organisational change. • The threats to competitiveness posed by increasing protectionism and the emergence of low-cost competitors among the newly industrialising countries have encouraged the strong belief that Japanese corporations must redouble their innovative strategies with the aid of enhanced R&D facilities (Clark 1984). The concomitance of these efforts are evident in the competition of companies to recruit more master’s-course graduates, the attempts to promote the role of universities in continuing education, the evident concern about the capacity of the system to stimulate creativity among engineers, and efforts to improve the re-education of mid-career engineers (Oshima and Yamada 1985). The increase in the proportion of R&D workers is reducing the scope for rotation and flexible careers within the enterprise. In addition, the premium on developing research facilities and research workers may lead to increased labour mobility and the use of external labour markets. However, the orientation of existing systems of continuing education to in-house provision through o-j-t for lifetime employees has meant that it has neither encouraged nor supported the mobility of R&D staff. A fuller discussion of the implications of greater efforts to develop innovation and their implications for R&D careers are taken up in Chapter 4. One evident implication is that this will be an area in which there will be attempts to develop the collaboration of universities in continuing education (Oshima and Yamada 1985). • As part of their strategy to penetrate international markets despite growing protectionism, Japanese companies are becoming more overtly multinational companies. Trevor described them as ‘reluctant multinationals’ in the past, reluctant to leave the social environment of Japan with its stock of institutions so congenial to business operations (Trevor 1983). Now the companies are developing educational programmes for overseas personnel to encourage ‘international mindedness’ (Amaya 1983). (A fuller discussion of the character of Japan’s overseas investment and the nature of Japan’s transplants in the UK will be taken up in Chapter 7.)

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• Japanese manufacturing companies are said to be engineering companies run by engineers and this thread of technological literacy permeating the large corporations is said to be a significant factor in their innovative success. It has not been an unblemished record, however. Clark noted that some innovative efforts had been insensitive to markets, reflecting ‘a predisposition to innovate by extending technology rather than adapting to markets’ (Clark 1984:75). Therefore it is likely that in the more constrained market opportunities of the 1990s the companies will place a greater emphasis on marketing skills. • The motivation of the younger generation is a topic which has excited much concern among Japanese managers (Amaya 1983). Clearly the willingness to engage in the rigours of the competitive educational system, the readiness to be sensitive to organisational requirements and to acquire organisational skills, and the commitment to apply those skills across widely defined tasks for long hours over a working life for one employer have been hallmarks of the moral order of a Japanese corporation. Japanese managers have exercised themselves about ‘shin-jinrui’ (‘the new-age people’); they have been seen as a generation who do not know war or the struggles of the early post-war period, whose aspirations and values are thought alien, and whose loyalty is thought suspect. While it might be wondered whether such people would ever arrive as graduate engineers, surveys of R&D workers suggest that they have two main complaints against the present operation of the lifetime employment system: first, they complain that the pace at which engineers are promoted to responsibilities commensurate with their abilities is too slow in Japanese companies; and second, they claim that the weight attached to ability and performance is too small in Japanese companies (Nakajima 1985). Such complaints might be expected to grow as more American companies attempt to establish R&D facilities in Japan and as these companies and their personnel systems became reference points for Japanese engineers. (A fuller discussion of the factors which generate either content and discontent in R&D work is taken up Chapter 6.) At present all these factors do not appear to add up to a change of the lifetime employment system, rather they appear to be changes in scale and scope, and changes within the system. Nevertheless they indicate changes underway in the system of education and training, and they must underline the need for caution against those who would borrow ‘yesterday’s model’. Conclusions Not all the companies included in this account had glowing records of success, indeed it is evident from Table 3.1 that some of the chemical and steel companies were in difficulties in the mid-1980s, even leading to mergers among some of the keiretsu chemical companies by the 1990s. Yet all of the companies remained firmly committed to the concept of lifetime employment. This commitment has produced in the past some distinctive features in the company strategies for the development of engineering manpower resources:

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• A sharper division of labour between education and employers as academics concentrated on a broad general education and employers provided organised training. • A reliance on the educational system as a talent sorting system for the production of educated manpower. • Employers recognised the need for training if their ‘permanent’ labour force was going to cope with change in the business and technological environment, and employees accepted the obligation to train and cope with change as the quid pro quo of security. • The core of training has been through on-the-job training with close management involvement in training. • Considerable emphasis has been put on the acquisition of ‘organisational skills and knowledge’. • The pay system has supported training, but the data on pay do not support some of the assumptions of British observers that Japanese engineers ‘must’ be relatively well-rewarded in Japanese companies. These features are not in themselves unique to Japan. For example, Cambridge University has long concentrated on a broad engineering science course and British employers have tended to prefer the more academically able university graduate to the more vocationally equipped polytechnic sandwich-course student. Moreover some companies have been renowned for their training schemes. The point has been that these features have been so much more common in Japan that they have become a ‘norm’ in both the statistical and sociological senses among the large companies, and this greater critical mass of training and learning activity has been important in the innovative capacity of Japanese companies. The institutionalisation of the lifetime practices as part of a wider employment system with profound implications for training has largely occurred in the postwar period. While scholars differ in dating the origins of lifetime empoyment (Hirschmeier and Yui [1981] cited the period 1900–18 and Dore [1973] cited the 1920s), Gordon put his emphasis on the impact of the First World War as a watershed when the balance of power between capital and labour was changed and older forms of labour management were no longer sustainable (Gordon 1988:121). The wider extension of this pattern of employment relations to bluecollar workers after 1945 also reflected the further strengthening of the position of Labour. The consequences of the ‘Japanese employment system’ for graduate engineers can be seen in a number of beneficial effects: • The broad educational base implied a strong base on which to build subsequent learning. • The mutual commitment of employer and employee to training meant that the development of the concept of a ‘learning organisation’ in which mechanisms were developed to facilitate institutional training—for example,

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those sent on off-the-job training have returned with an obligation to share their learning with the work group (McCormick 1986c). • The homogeneity of training experiences has meant the building of a companywide technological culture which leads to a closer proximity in the relative status of functions such as ‘Research’, ‘Development’, and ‘Production’ and helps the integration of functions such as R&D. • The system of rotation and the lack of identification with specialisms has aided the movement of engineers to ease ‘bottlenecks’ and the development of new activities. • The emphasis on company identifications and the spread of features of the employment system beyond engineering and white-collar staff to blue-collar workers has reduced the social distance between engineers and blue-collar workers. I have cautioned against treating training simply as a set of off-the-job training courses in which doubling the amount spent might double the benefits in terms of knowledge and skills, or ultimately task performance. The purpose, content and methods of training must be seen in relation to an economic and social system. Yet once training is seen as embedded in a particular economic and social system, the scope for borrowing seems more limited. Thus, even if the innovative and higher value-added strategies of Japanese companies are similar to those advocated for British companies and even if more career development policies through internal labour markets echo lifetime employment policies, the scope for implementing these business and human resource strategies will be severely restricted if they are dependent on the peculiar financial structure of Japanese companies. Similarly, the emphasis on groupwork cannot be seen as simply the logical outcome of an internal labour market. Behind groupwork lies the support of Japanese language and culture where the language has encouraged heavy dependence on oral communication, and pre-industrial work—for example, rice cultivation—required co-operative patterns of working (Smith 1959:208–10; Hendry 1995:42–56). Quite apart from the difficulties of borrowing out of a particular cultural context, there are the problems of avoiding unwanted side effects. The costs of the o-j-t, which the British engineering manager, John Lorriman, saw in increasing numbers of engineers employed, may be seen in hours worked rather than headcount. The long working hours, the curbs on individual liberties and the restraints on initiative associated with lifetime employment and the company management of careers may appear too high a price to pay to attract increased company commitment to training. Moreover there are signs that Japanese companies may be moving in the direction of increased mobility. The principal lessons for British engineers from these international comparisons are the needs to clarify the purposes of training, to make judicious selections of the ‘good effects’ achieved by training in other places, and to attempt to replicate those ‘good effects’ by means consistent with one’s own culture. For the future the main needs for training discussions in Britain appear to be:

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• The funding of training and the need to achieve the functional equivalent incentive to training given by lifetime employment. If British companies are unlikely or unable to move in the direction of a ‘lifetime employment system’ then this may imply that alternative systems of funding ought to be sought by other means—for example, through tax concessions (either to companies or to individuals), through revised (or revived) levy grant schemes, or through training vouchers. • The individual’s stake in the organisation and the need to achieve the functional equivalent of ‘membership’ in the Japanese company. ‘Membership’ in the Japanese company has tended to imply the employees rather than the shareholders, in contrast to the British companies. If the reality and perception of a stake in the organisation underlie the training effort of companies and employees then it raises the issue of whether this might be stimulated in the British case by more formal provision for industrial democracy, or by less formal schemes of participation, or by the company management of nonfinancial rewards. • The commitment of line management to training, the need to apply a more critical intelligence to work organisation, and to stimulate the concept of a ‘learning organisation’. Involving British line managers and supervisors in training raises the possibility that the recent fashion for appraisal schemes might stimulate a commitment comparable to that achieved under Japanese conditions.

4 Engineering innovation From ‘national systems’ to corporate laboratories and projects

‘From the engineering ranks had risen not only half of all directors of Japanese industrial enterprises, and an even higher percentage of the upper management cadre, but also the elite civil servants—half of them hold engineering-related degrees.’ (Gregory 1984:51)

Introduction Many attempts to explain Japan’s emerging technological prowess and business success in the 1980s conjured up the image of ‘Japan Inc.’, a society where all the central institutions from government, civil service, schools, universities, and industrial corporations were orchestrated together in the concerted pursuit of industrial growth. It had many of the hallmarks of a ‘technocracy’, whether that was meant as a society run strictly on technical decision rules or one whose leading decision-makers were trained in technical disciplines. Gene Gregory, quoted above, underscored this second image of Japan as a technocratic society which drew heavily on engineers to man the important command posts of the economy and society. It is an image which has proved controversial in several respects, from the alleged numbers involved to the deeper implications about the ways in which institutions and organisations work. Two central issues for this chapter are: first, is it possible to identify a distinctive national approach to the organisation of engineers and scientists in the pursuit of innovation, whether at the macro level of the society or at the more micro levels of the company or the project team, and secondly, if there is a ‘national system of innovation’, what are the implications of attempts to change it? Gregory, a close observer of Japanese industry and government, was an important but often unattributed and misquoted source in British arguments about the relative numbers of engineers produced in Britain and Japan. His estimates of Japan’s output of engineers, which exaggerated Japan’s numerical advantage, became even more exaggerated in the hands of several British interest groups (as we saw in Chapter 2). They used them to press for change in Britain’s educational system. But Gregory’s thesis was about more than mere numbers

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of engineers. He argued that the large number of engineers helped sustain a wider and deeper technological literacy in Japanese society. Further, he argued that engineers greatly outnumbered scientists in Japanese universities, whereas in Britain and the US the respective proportions were either near parity or scientists outnumbered engineers (Gregory 1984:53). Gregory’s explanation that engineers were seen in Japan as the practical people needed to solve industry’s problems, whereas scientists were theorists, and something of a luxury, was music to the ears of those lobbyists for the engineering profession and who complained that British culture devalued engineers and that British industry suffered in consequence. His numbers supported their calls for a change in the proportions of engineers vis-à-vis science and arts students: …the lower number of physical science students has some rather compelling economic explanations…To meet their priority targets, neither Japanese industry nor government requires the theoretical training of these scientists. Engineers, not scientists provide the technological and managerial backbone of Japanese industry. (Gregory 1984:53) However, Gregory drew attention to another aspect of the utilisation of engineers, arguing that engineers not only solved practical problems but had careers reaching up to the command posts of industry—and to top levels of Japan’s civil service too. It was an argument adding colour to the image of the Ministry of International Trade and Industry (MITI) as the engineers’ and industrialists’ friend in government, sharing a common perspective, empathy and language with engineers and industrialists, able to champion their causes, and able to shape and support Japan’s industrial development. However, there are a number of problems with this account which need closer inspection. Although I shall examine some aspects of innovative efforts at the national level, the main focus for this chapter is on companies and the human resource management issues involved in the organisation of company R&D. My interest rests on the premise that Japanese companies have been putting a great deal of emphasis on the role of technology in their competitive strategies and taking much more responsibility for their own development of technology. As company initiatives have assumed greater importance and the state had less directive influence, the Japanese ‘national innovation system’ has been changing. Such changes have stimulated much discussion about the need to adapt institutions which have been part of past success. Those rather simplistic views of ‘engineers as practical’ and ‘scientists as theoretical’ do not sit too easily with the concerns about the need to develop more basic research in industry. Therefore I shall examine the debates about a changing system and go down from the macroscopic level of the debates on the ‘national systems of innovation’ to the more microscopic levels of engineers and scientists in their corporate laboratories and projects. My starting point in the next section will be an examination of the discussions of the respective ‘national systems of innovation’ in Japan and Britain. Much

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of the illustrative empirical material on corporate laboratories will be drawn from the surveys of the ‘International Research Group on R&D Management’ in which I was directly involved from 1988–89, a pathbreaking, collaborative and comparative study of engineers and scientists and their careers in corporate R&D Japan (and which will be described more fully later). Before presenting the microscopic level of the everyday working world of the individual engineer and scientist, I will summarise the intermediate level of the corporate laboratories, their organisation and their mission in corporate R&D. I will then move down to the micro level and the manner in which the lifetime employment system impinges on project organisation, leadership selection and patterns of communication. Finally, I shall come back to the problems for companies in trying to produce institutional innovations. National systems of innovation The way in which engineers and scientists are organised to promote innovation can be examined with the concept of a ‘national system of innovation’, a concept driven by the desire for much more systematic attempts to synthesise the cumulative body of innovation studies and to relate them to their different national contexts. While this concept has been used in different ways, Freeman, one of the central figures in the growth of the field, concentrated on the importance of social and economic organisational innovations associated with technological innovation (Freeman 1987a, 1987b, 1992). From insights into the support of social institutions for technological innovation, Freeman went on to stress the importance of the respective roles and relationships between a number of institutions such as industrial corporations, universities in their educational and research activities, government and financial institutions. It was perhaps inevitable in the 1980s that much of the British attention in AngloJapanese comparisons would focus on the government-industry axis of the Japanese national system of innovation. The desirability and feasibility of an ‘industry policy’ were often debated in Britain with reference to the very sharp contrasts which could be seen between the historic role of the Ministry of International Trade and Industry (MITI) in Japan’s technological development and the (then) British Conservative government’s apparent anathema for anything which smacked of ‘industry policy’. Mrs Thatcher and her colleagues in government branded such policies as ‘corporatist’, which was intended as both description and denunciation. Throughout the debate, the danger has been that British observers, anxious to debate the role of the state in Britain, have overplayed the role of the Japanese state (particularly MITI), underplayed the role of companies in Japan’s historical development and neglected the changing roles of both for the future. While the concept of a national system of innovation has been used in a number of different ways, all the writers on the subject reflect a strong belief in the importance of technological change in economic and social development and an assumption that national differences in markets and institutions shape

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technological innovation. Among these writers, Chris Freeman emphasised a distinction between ‘radical’ and ‘incremental’ innovation, the importance of the ‘goodness of fit’ between a radical technological innovation and social institutions in order to exploit the full benefits of the new technology, and he took a particular interest in Japan for its success in catching up and, in some technological fields, overtaking Western competitors. He defined a national system as ‘the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies’ (Freeman 1987b:1). Freeman offered a selective list of those institutional features which had distinguished and contributed to the success of Japan’s national system of innovation: …the exceptional Japanese progress in ‘catching up’ with the world’s technological leaders and drawing ahead in some areas was attributable to the development of an institutional and social framework—a ‘national system of innovation’, which differed in important respects from that prevailing in other OECD countries. Some of the main characteristics were …the role of MITI; the role of company research and development strategy in developing a new integrated approach to the design and development of production systems; the role and scale of education and training and controlling the labour force; and finally the development of an industrial structure particularly favourable to long-term strategic investment in marketing, training and technological activities. (Freeman 1987b:55) Over the earlier phases of technological development Freeman outlined the important lessons from ‘reverse engineering’—that is, dissembling, copying and adapting imported products. Through this technique, Japanese engineers learned to think through the whole production process, to ‘think of the laboratory as a factory’, to think comprehensively of assembler-supplier relations, and to put an emphasis on quality in products and processes since reverse engineering involved searching out systematic weakness. Although Freeman noted the strong impetus given to technological development in the Meiji era by the government promotion of modernisation policies, engineering education and training, the import of technology and industrial ‘best practice’ and co-operation with industry, he attributed much of the post-war success to the reforms in the Occupation era—for example, in industrial relations. Given that he stressed the emergence of Japan’s institutional framework over a long period and given that he noted a variety of factors precipitating these institutions (for example, he attributed the close relations of engineers with blue-collar workers to the outcome of a power struggle between labour and capital rather any technological forces), McKelvey’s charge of ‘technological determinism’ seems wholly misplaced (McKelvey 1991). Freeman does not appear to put the primacy on technological change shaping social institutions, even though he comments that the institutional framework of industrial relations had benefits

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for the diffusion and adoption of new technologies through engaging bluecollar workers in the innovation process. Although Freeman’s emphasis on the distinctiveness of Japan’s education and training infrastructure incorporates the exaggerated contrasts between numbers of engineers in Japan and Britain (discussed in Chapter 2), the underlying points about the qualities of school and university education and company training for engineers remain valid. The notion of ‘engineering’ as the key route to Japan’s decision-making elite can be readily challenged by totting up the numbers of senior administrators with legal backgrounds in the civil service (Campbell 1989:115). Even in the heartland of technology policy at MITI, law rather than engineering is more likely to be the educational passport to the top, while an economics education is just as likely as one in engineering to facilitate passage to the company boardroom, even in manufacturing industry (Kinmonth 1986). Table 4.1 shows the university and faculty background of the senior officials in MITI in 1988. Of 21 officials at director-general or deputy director general level, all were graduates of a former Imperial University, which certainly confirms the importance of the elite universities, but only three of these bureaucrats had an engineering background. Law was confirmed as the most advantageous route to a senior position. In 1997, between 30 and 40 percent of the new recruits (depending on first or second class of entry) to MITI came from a technical background. Yet, if future trends in recruitment and promotion follow the past, the advantage will continue to lie with the law graduates. Meanwhile, the discovery of a Nobel prizewinner in a Japanese university engineering department should encourage caution about the ready translation and isomorphism of labels such as ‘engineering’ and ‘science’ for graduates and university departments from a Japanese to a British context (Rawle 1983). Academic titles might reflect more on formative histories and the rigidities of academic bureaucracies than current activities—for example, the greater ease in establishing departments labelled engineering compared to other titles. Moreover, the notion of widespread satisfaction with the relative numbers of engineers and scientists was challenged in a provocatively titled paper, ‘Where will the Nobel prizes come from?’, which drew attention to criticism within Japan that the economy and society were facing a watershed which would need more attention to science and basic research (Dore 1986). The main controversies in accounts of Japan’s technological development tend to dwell on discussion of the role of the Ministry of International Trade and Industry (MITI). In many ways it is part of an older debate about the role of the state in Japan’s technological debate. Looking at the Meiji era, MorrisSuzuki contrasted those approaches which emphasised the significance of the state (for example, from model factories to educational institutions) against those perspectives which emphasised the role of markets and entrepreneurs (Morris-Suzuki 1994). Both perspectives, she argued, were overdrawn, failing to acknowledge the strengths in the counter views. Her emphasis on ‘social networks’ acknowledged the importance of state initiatives, but argued that for the diffusion of technologies, markets and networks were important too.

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Okimoto argues in similar vein on the MITI debate that contrasts between state and market have been overdrawn and that a flexible set of relationships were created and that they should be viewed through an integrated political economy (Okimoto 1989). Freeman contends that much of the controversy about MITI stemmed from confusions arising from the failure to distinguish changes in the scope and mode of MITI’s influence through different stages of development. In his study of Japan’s computer and communications industry, Fransman puts the 1970s as a turning point in government-industry relations (Freeman 1987b; Fransman 1995). Although admitting the importance of MITI in supporting the general technological development of the Japanese companies up to the 1970s, Fransman argues that the impact of MITI’s much publicised ‘visions’ of industrial development were limited. Moreover, he argues that the companies would have been successful without MITI’s efforts (Fransman 1995: 446–8). In their account of the ‘Japanese system of innovation’, Odagiri and Goto were at some pains to redress the stress on government in many accounts, depicting both the historically modest role of government in financing R&D and stressing the very important role of the private sector and Japanese entrepreneurs (Odagiri and Goto 1993, 1996). Looking to the future, they anticipate that market liberalisation and deregulation will mean that government ministries and agencies will have diminishing scope to influence and shape technological development. In his study of the computer industry, Cusumano suggests that government initiatives have not been a major influence, but argues that the companies’ determined persistence and their application of superior engineering and production processes to software paid dividends in business success (Cusumano 1991). Discussion of the British system of innovation has been largely caught up in explanations of long-term relative economic decline, charges of ‘system failure’ stemming from the alleged failure of the financial institutions (particularly those concentrated in the City of London) to support long-term technological development in industry, allegations that accountants and financial criteria held too much sway in senior management in industry, complaints of weaknesses in technical and vocational education and training attributable to cultural hostility, and debates about the potential for an appropriate state-led industrial policy to reverse decline (Freeman 1987b; Walker 1993; Patel and Pavitt 1993). Walker complained that Britain appeared set to become a ‘technology follower’, able and content to apply other countries’ technologies successfully in a number of areas, but no longer willing or able to act as one of the major generators of original technology, save in a few niche areas. Prospects for change in this posture appeared slim with the pronounced neo-liberal emphasis put on government policies and preoccupation with public expenditure reduction by Mrs Thatcher and her colleagues from the mid-1980s. In Britain, two major sources of concern have been that industry does not spend enough on industrial R&D and that government does not spend enough on academic science, the ‘science base’. In the mid-1980s, many of the concerns

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about Britain’s R&D performance were voiced before the House of Lords Select Committee on Science and Technology which was examining Civil Research and Development. Among the more prominent points which emerged from these debates about their report were the following: • Britain’s total R&D spending had been growing more slowly than that of other major industrial countries—for example, it increased at a rate of only 0.9 percent per annum over the period 1969 to 1982 compared with 9.8 percent per annum in Japan. • The contrasts were even more marked for civil R&D since a relatively high proportion of Britain’s R&D had been oriented to defence needs. Of the total UK R&D expenditure about half was funded by industry and half by government, and the government portion was further divided approximately 50:50 between civil and defence needs. In 1983, £3,637m was spent on R&D in private industry, of which £1,217m (33.5 percent) came from government and £2,099 (57.7 percent) from private industry. • Industrial R&D expenditure had been very heavily concentrated in aerospace, electronics and chemicals. This concentration had lengthy historic roots—for example, in 1955–56 the aircraft, chemicals and electrical engineering industries employed three quarters of the industrial R&D personnel and spent more than three quarters of industry’s R&D spending. In 1980, the Finniston Report noted the continuing dominance of the aerospace, chemicals and electronics industries in industrial R&D spending. However, they noted a concentration by company too, for 91 percent of private industry R&D was concentrated in 100 companies and 52 percent in only 10 companies, all of which were in the three industries of aerospace, chemicals and electronics. Government had an important influence on the R&D activities of the three sectors; it was an important source of funds in the aerospace and electronics industries and as a supporter of basic science and postgraduate research training for the chemical industry. • In addition to the long-standing evidence of concentration in industrial R&D spending there was further evidence of more recent variance between sectors and between firms. While noting the influence of the sluggish trend of overall technological activity in Britain, and the influence of unfavourable trends in profits and output, Patel and Pavitt lay considerable emphasis on the discretionary decisions of companies to increase or decrease R&D investment. • Where the House of Lords Select Committee emphasised a need for increased government support and encouragement for industrial R&D through a variety of measures, the government response emphasised the prime need for private industry to fund an increase in R&D expenditure, taking commercial decisions that reflected market forces. Noting the concern that Britain had one of the slowest growing economies in the 1960s and 1970s the Government pointed out that in the 1980s Britain had one of the fastest growing economies, that productivity in manufacturing industry was rising

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faster than in other countries, and that company profitability in 1985 was at its highest since 1964. Therefore the Government concluded that private industry could afford to fund more R&D: the arguments that slow growth, low productivity growth and low profitability were deterrents to industrial R&D were less valid than in the past. Charges that financial institutions have had a baleful influence on manufacturing industry in Britain have a long history, but have often suffered from poor specification (Moorhouse 1989). Some members of the Finniston Committee wanted to investigate the impact of the financial system on engineering, but the Committee was advised that this lay outside its terms of reference. The financial deregulation reforms after the ‘Big Bang’ in October 1986 injected some new interest in the arguments about the existence of ‘shorttermism’ and its alleged consequences for British industry (Ball 1991; Williams 1991; Moorhouse 1989). Some commentators have argued that the preoccupation with short-term time horizons has not been imposed by the terms of external finance but developed as an internal culture within companies (McKinsey 1988). There is a large measure of agreement that Britain has invested too little in innovation. Contrasting the involved and supportive role played by institutional shareholders in Japan and Germany, the Innovation Advisory Board, established by the Department of Trade and Industry, proposed a number of measures to make shareholders and stockholders more aware of R&D and, in effect, recommended that companies should consider trading some degree of management control for greater shareholder loyalty (Innovation Advisory Board 1990). Confirming the evidence of under-investment in the manufacturing industry in Britain, Barry, Bosworth and Wilson argue that this failure has stemmed from a lack of investment opportunities rather than a shortage of capital. Moreover, they pin culpability for failure to generate investment opportunities on the failure of company engineers and scientists to generate sufficient worthwhile projects, whilst conceding that the difficulties for companies in recruiting a fair share of able graduates may be part of a larger picture of education-industry relations in Britain (Barry, Bosworth and Wilson 1997). If the argument on Britain comes back to the notion that engineers are central to the innovation process, it is time to turn to examine their role in that process more closely through comparative studies and to start with a review of alternative approaches. Comparing engineers in the innovation process The success of Japanese companies in innovation prompted several studies of engineers from a variety of perspectives and using different methods, ranging from studies that compare the outflow of graduates from universities to studies which focus on the inflow of graduates into companies. Some comparative

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studies take the organisation as the unit of analysis, rather than the occupational group, but give analyses of engineers in organisations. Outflow studies One path to comparisons of engineering careers in Japan and the US has lain through surveys of engineering graduates from matched universities. In essence, this approach attempts to follow the outflow of engineering graduates from education into employment, to trace their career choices, employment and work experiences after graduation. Clearly the first step lies in matching institutions, given the variety of types of institution and the pyramids of institutional prestige in respective countries, and the second step lies in matching the graduates themselves. The study by Lynn and his colleagues tried to match reputable universities with strong traditions in technological education to secure comparable student intakes and comparable career destinations. Starting from their home base in Carnegie-Mellon in the US, the researchers selected Tohoku University in Sendai as a Japanese counterpart, a university with a similar strong regional identity and similar distance from the main manufacturing centres, and aimed for graduates in two disciplinary areas, electrical engineers and metallurgical engineering/materials science (Lynn, Piehler and Kieler 1993:58). This study was exemplary for the care taken to match data-gathering instruments with a translation of the questionnaire into Japanese and retranslation back into English to double-check interpretation. However, even the best laid plans can come unstuck on contingencies, and the collapse of the dollar against the yen undermined a planned reminder mailshot among the Japanese sample. Despite this setback, the researchers were able to secure respectable response rates (42.5 percent in the US and 24.1 percent in Japan) and well-matched samples in terms of age (mean age 41.47 in the US and 41.49 in Japan) and gender (97.0 percent male in the US and 99.5 percent in Japan). The ability to analyse responses in terms of age cohorts permitted comparisons against the background of changes in the respective national economies. The heavy preponderance of electrical engineers in the American sample (75 percent compared to only 43.0 percent in Japan) limited the scope for inter-industry comparisons. While this research confirmed some popular images of the more managed career of Japanese engineers, it generated some surprises too. For example, in communication patterns and professional associations, Japanese engineers appeared to use extra-company sources and to value professional bodies more highly than anticipated. Lynn and his colleagues laid stress on the role of ‘gatekeepers’ in knowledge and technology flows and showed that the significant differences between Japanese and American engineers and their experience of rotation lay in its continuing use among the more experienced Japanese engineers and its limitation largely to the early career stages of American engineers. While the authors cautioned that their findings were not typical of the population of engineers, since they were drawn from two high-

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ranking institutions and two disciplines, their respondents were drawn from companies across a number of industries and they shed further light and qualifications on some important areas of technology and human resource management. Another major example of an outflow study was initiated by Japanese researchers against the background of Japanese concern about the growing tendency for able Japanese engineering graduates to avoid careers in manufacturing industry (see Chapter 2) and reports that the American manufacturing industry had suffered because American engineers gave low priority to careers in production (Ishii, Yokoo and Hirano 1993). Therefore the National Institute of Science and Technology Policy (NISTEP) focused on leading engineering departments in both countries—at the University of Tokyo and the Tokyo Institute of Technology (TIT) in Japan and at the Massachusetts Institute of Technology (MIT) in the US. The target sample was all recipients of the Bachelor of Engineering degree in 1960, 1970, 1980 and 1985 in each institution. Again, response rates were much higher in the US than Japan, with a total of 1,162 (25 percent) responses in Tokyo and 925 (45.8 percent) in MIT. Again, male respondents predominated (99.4 percent in Tokyo and 87.3 percent in MIT). Although there was a wider spread of academic disciplines covered than in the Cairnegie-Mellon/Tohoku study, there was a heavy representation among electronics engineers (38.5 percent among the MIT sample and 22.6 percent among the Tokyo sample—the largest disciplinary cluster in each national sample). Given the focal research problem, the questionnaire survey was aimed to compare: first, the career distributions of the two samples, particularly the proportions of engineering graduates working in manufacturing industry and with technology-related jobs, and secondly, the factors which had influenced career choice. Under this second heading, the researchers wanted to explore ‘individual job consciousness’, the treatment of engineers in corporate management practice and the social status of engineers. The main findings on distribution were that a higher proportion of the Japanese engineers were concentrated on technical activities compared to their American counterparts (57 percent of the Japanese sample worked in the manufacturing industry and 68 percent were working on technology-related jobs compared to 42 percent of the American sample in manufacturing industry and 55 percent in technology-related jobs). In looking more closely at the career-choice factors for clues to explain the distribution of engineers, the researchers noted that American respondents paid more attention to monetary rewards and they had more scope to find those rewards outside the manufacturing industry. Moreover, they noted that Japanese rewards shared equal standing between engineers working in the production and R&D departments, whereas American engineers saw higher status in R&D work compared to production work. Despite being initiated in different countries, these outflow studies share some common characteristics. Both drew on elite engineering institutions, both heavily featured electrical engineers and computer scientists, and both were strongly oriented towards policy implications. While the two Tokyo institutions

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and MIT were at the respective peaks of the pyramids of prestige in engineering education in the two countries, Carnegie-Mellon and Tohoku were not far below. There is a lacuna in our knowledge of the career experiences of graduate engineers from the middle- and lower-ranked university institutions. While the Carnegie-Mellon/Tohoku study revealed some differences between electrical engineers and metallurgical engineers and the Tokyo/MIT study included mechanical and civil engineers, both studies shared a strong emphasis on electrical engineers and the electronics industry. By implication, both studies provoke some curiosity about the likely outcomes if chemical engineers and the chemical industry had been included. The Carnegie-Mellon/Tohoku study was initiated to check out many of the popular assertions in the US-Japan manufacturing debates which turned out to be based on little more than travellers’ tales and anecdote. The policy orientation of the Tokyo/MIT study was much more direct and explicit. The Director General of NISTEP took the opportunity to deliver a piece of advice to President Clinton: …the US needs to commit more manpower to instilling engineers with a sense of craftsmanship and a willingness to work in manufacturing industry…If the Clinton administration truly wants to build a secure future, it will work to devise policies that enhance the scientific and technological prowess upon which economic strength rests. (Sakauchi1993:3) If the implicit secondary message was to stop indulging in negative trade friction complaints and to put the American house in order, the emphasis on virtuous craftsmanship and well-motivated engineers is understandable. However, the step from findings to policy advice might be judged tendentious since the findings noted that there were different industry mixes in the American and Japanese samples. Thirty percent of the US engineering graduates worked in the aerospace, computer and medical technology industries where the US had a strong advantage compared to only 12 percent among Japanese engineers, while 47 percent of the Japanese respondents worked in electrical equipment, machinery, chemical and automotive industries compared to only 20 percent of the American respondents. Moreover, the ‘willingness’ of Japanese engineers might owe more to the constraints of the lifetime employment system than to any sense of vocation. On both of these outflow studies, the Japanese lower response rates were lower than those of their American counterparts. This contrasts with the more usual expectation based on inflow studies. However, the Japanese response rates in inflow studies are usually based on access to respondents via managers, and as Sakakibara and Westney noted, ‘a questionnaire permitted by management has real “authority” in the Japanese context that it does not have for US employees’ (Sakakibara and Westney 1985:3).

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Inflow studies Instead of locating a population and sample of engineers by university, a much more common approach has been to locate engineers by current employer, and in effect, to examine the inflow into employment from the education system. One of the earliest attempts to explore similarities and differences in the training, careers and research organisation between Japanese and US engineers was undertaken through the Harvard US-Japan relations and the MIT-Japan Science and Technology programmes. The reports of Westney and Sakakibara on the two foci of research organisation and engineering careers became pioneering templates for many subsequent cross-national studies in methodology and findings (Westney and Sakakibara 1985; Sakakibara and Westney 1985). Data collection was based on interviews and questionnaires aimed at the corporate central laboratories and at the product division-level laboratories of three Japanese and three American firms in the computer industry. Since companies undertook responsibility for the distribution of questionnaires to a stratified sample of their R&D employees, response rates were higher among the Japanese sample (90 to 100 percent), more accustomed to support a questionnaire permitted by management than their American counterparts (40 to 50 percent). While the 306 Japanese respondents could be clearly associated with central corporate laboratories (208) and product division laboratories (98), it was more difficult to sub-divide the 109 US engineers. The US companies tended to use relatively small ‘advanced technology groups’ in the early stages of projects (which were less critical in new product development than the Japanese central laboratories) and ‘design development groups’ (which were less closely linked to manufacturing than the Japanese parallels, whether in organisational structure, spatial location or personnel flows). Thus much of the subsequent statistical analysis of responses was based on the 98 Japanese division level engineers and the total of 109 American engineers. Although the participating companies were named in research reports, all of the analyses are conducted at the level of national rather than company samples. Through their analyses, the researchers demonstrated that differences between the Japanese companies and their engineers were ‘systematic, structural and institutional, rather than personal’ (Sakakibara and Westney 1985:2). The two central findings—that Japanese companies maintained a closer linkage between R&D and manufacturing than American counterparts in terms of the three levels of corporate structure, project team and individual engineer and that the Japanese company bore a much greater responsibility than the individual engineer for guiding engineering employees’ career development compared to American companies, have been supported by much other research. In trying to compare the process through which younger engineers entered industrial employment and set about complementing their academic knowledge and skills with organisational knowledge and skills, Thurley, Lam and Lorriman adopted an imaginative and innovative methodology (Thurley, Lam and

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Lorriman 1988). Putting their focus on the learning and problem solving of engineers in the context of employing organisations and their cultures, they gathered a sample of engineers from R&D departments in British and Japanese companies in the electronics and information technology industries. With their samples of Japanese and British engineers, they concentrated on a six-month period of training and learning experiences reported through monthly diaries, supplemented by interviews and questionnaires. Again, although participating companies were named, the researchers concentrated their analysis on national samples. The merits of the methodology lay in the rich database gathered and the engineers’ -eye view of the organisational context of engineering formation. Against these benefits, there were high costs on both respondents and researchers. Respondents had to be highly motivated (or at least, their motivation had to be sustained by the researchers) and there were heavy demands on the researchers in data collection and analysis. As the researchers recognised, the demands on respondents meant that respondents were self-selected as volunteers and the project risked producing an a-typical sample. Set against this potential difficulty, the research design has generated a rich data set and insights into the complexities of engineering task situations through a panel study. Unfortunately, the planned completion of this demanding project was handicapped by the untimely death of the principal investigator, Thurley. Nevertheless, Lam has continued to demonstrate the merits of a close and intensive panel study (Lam 1993). Organisational studies Although comparative studies of organisations take the organisation as the central unit of analysis, rather than the occupational group as in outflow or inflow studies, they have provided another source of insights into the crossnational variations in the utilisation of engineers, and often by implication into their education and training. The pioneering comparative studies of organisation and innovation in Japan and the US by Hull and Azumi using matched data sets provided early examples of the respective strengths in different areas of innovation of different forms of organisation (Hull, Hage and Azumi 1984a; Hull and Azumi 1989; Hull and Azumi 1991). Using data sets from the 1970s and 1980s, Hull and Azumi demonstrated the relative strengths of American companies in frontier research and of Japanese companies in the transfer of developed technologies within the company. In this process, Hull and Azumi drew attention to the role of Japanese engineers as ‘trained in-house generalists’ (Azumi and Hull 1990: 9). Assessing changes in organisational structures over the decade, Hull and Azumi suggested that there was evidence of convergence attributable to Japanese companies’ needs to cope with more radical innovation and adopt organisational structures more familiar in the US. However, they underlined continuing differences between the two nations too, particularly in the positive correlation between size and inventiveness in Japan. Here, the authors drew on

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contextual factors, particularly the big differences between the roles of large and small firms in the innovation system in Japan. Where Hull and Azumi’s organisational studies concentrated on hypothesistesting at the organisational level of analysis with large sample surveys (110 US companies and 36 Japanese companies in the 1970s and 164 Japanese and 36 US companies in the 1980s), some later Franco-Japanese studies conducted by two Government research institutes have relied on intensive case studies in four companies (one chemical and electronic company in each country). In these studies in the 1990s, researchers from the Japan Institute of Labour (JIL) collaborated with researchers based in the Aix-en-Provence Laboratoire d’Economie et de Sociologie du Travail (LEST) of the Centre National de Recherche Scientifique (CNRS) (Itoh et al 1991; Lanciano and Nohara 1993). The French team drew on the ambitious theoretical framework of ‘societal effects’ designed by Marc Maurice to explore cross-national and cross-cultural differences all the way from the macro (or societal) level down to the micro (or individual) level. While some cross-national differences are evident, the merit of including both electrical and chemical companies lies in the researchers’ attention to inter-industry differences too. Comparisons of the electrical companies reveal different market contexts for the respective French and Japanese companies. The higher level of profitability in the French company rested on an oligopolistic domestic market, compared to the Japanese company’s greater reliance on export markets. While both companies spend about the same level on R&D (about 5 to 6 percent of turnover), they differ on capital investment, with a much higher Japanese level. Different approaches to corporate growth (the Japanese company being much more dependent on internal growth and the French company more reliant on acquisitions and external growth) are matched by different technology strategies and human resource management strategies for respective engineering labour forces. The Japanese company put great emphasis on the role of the Central Research Laboratory in the generation of new technologies to spur innovation and diversification, whereas responsibilities for technology acquisition were more diffused in the French company. Although the French electrical company identified a higher proportion of its labour force (49 percent of the total of 8,000 employees) as technically qualified compared to the Japanese electrical company (42 percent of 13,900 employees), when the focus is put on those higher-level engineers with the equivalent of four years or more of higher education, then the Japanese company has the much higher proportion (21 percent compared to 11 percent). Moreover, the contrasts are even more dramatic when their distribution is examined, with 13 percent of the Japanese higher-level engineers working in the Central Research Laboratory compared to only 1.5 percent in the French Central Research Laboratory. The corollary of the different technological strategies was the contrast in the Japanese company’s attempted synchronisation of technology and human resource development compared to the devolved French technology strategy and the tensions in human resource management for the French engineering labour force.

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The comparisons in the chemical companies were less straightforward since the French chemical company was in the public sector whereas the Japanese chemical company was in the private sector. However, the research teams identified differences in business and technology strategies and linked differences in human resource management policies and practices. These contrasts in links to their environments are associated with different human resource strategies for Japanese and French engineers. The Japanese engineers’ professional skills and careers were built through sequential moves between closely connected technical areas managed by the companies whereas French engineers took more responsibility upon themselves across more discrete spheres. The merits of these organisational case studies lie in their attempts to link a range of company policies and practices in business and technology strategy to human resource management for engineers and to weave into the analysis both the quantitative and qualitative aspects. Yet compared to the inflow and outflow approaches with their foci on the occupational, these organisational analyses tend to draw on illustrative interview material but do not generate systematic data of engineers’ experiences and perspectives. The International Research Group on R&D Management Compared to the contrasting methodologies of the extensive survey in the Sakakibara/Westney study and the intensive diary study in the Thurley/ Lorriman/Lam study, the International Survey of R&D Workers by the International Research Group on R&D Management, in which I participated in 1988–89 and on which I have drawn heavily in this and the following two chapters, tried to extend the survey approach in two directions. 1 First, the International Group on R&D Management aimed to extend the sample companies beyond the electronics or computer industries which appeared to predominate in many earlier research reports, and secondly, it tried to go beyond the two-country studies to include four countries (Japan, Britain, Germany and the US). Although the electronics and computer companies are prime examples of high-technology companies, the International Research Group wanted to explore the more chemical-based industries and to illustrate some of the company variety within the same industry, since the tendency to read and discuss single-industry studies as typical of all ‘Japanese industry’ or ‘the Japanese company’ must be treated with circumspection. The tendency to discuss national samples as Japan versus ‘the West’ prompted our extension from the Anglo-Japanese comparisons to Germany and the US. The benefits from this extended study were to demonstrate examples of ‘British exceptionalism’, rather than the more usual ‘Japanese exceptionalism’ that emerges from the more usual two-country analyses.1 Thus the surveys of the International Research Group on R&D Management in 1998 broke new ground in comparative surveys of engineers and scientists

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in industrial R&D staff with a broader industrial coverage. The process of sampling involved three stages—industry, company and individual R&D staff member. Clearly there are a number of problems in matching industries and companies—for example, the British electronics industry is strongly developed in the defence field but relatively weakly represented in the consumer electronics sector, with the reverse situation in Japan. Starting from a broad agreement to find roughly comparable companies in the electronics and chemical industries, the British and Japanese research teams worked in parallel to contact companies. Making contacts in parallel rather than in sequence made for some problems in securing matches, yet it did mean that that data collection was closer in timing. Despite some hiccups in company negotiations the eventual samples were remarkably well matched in terms of broad sectors. The surveys were completed in six Japanese and six British companies spread across five finer industrial classifications—electronics, telecommunications, chemicals, textiles, food and drink. This range of companies meant that there was a spread of types of R&D undertaking and administration. The electronics and chemicals companies provided examples of relatively high-technology industries; R&D expenditure ran at 8 to 10 percent of sales in electronics and only a little lower across chemicals (although in the pharmaceuticals sector expenditure could run well above 10 percent per annum). The food and drink industry has been characterised by much lower relative R&D outlays, although diversification and the potential of biotechnology have increased interest in the role of R&D in competitiveness for some companies in this sector. Although R&D expenditure data were neither required nor freely volunteered in Britain in the 1980s, all six of the British companies (or their parent companies) were listed in the top 100 UK companies ranked by R&D expenditure spenders in the UK (Company Reporting 1992). In addition to the questionnaire survey of R&D staff, case studies were built through interviews with personnel and R&D managers on recruitment, work organisation and career development in each of the companies—electronics (two companies in Japan and one in Britain), telecommunications (one company in each country), chemicals (one company in Japan and two companies in Britain), textiles (one company in each country), food and drink (one company in each country). The sampling frame targeted graduate-level engineers or scientists, aged 25 to 45, and working in R&D. Further details of the companies and the sample response rates are given in Table 4.1. Negotiating access through the central personnel departments of some British companies meant that they were not always au fait with the size of the total potential population, particularly in companies which decentralised business operations. In most cases the companies became responsible for distributing the questionnaires to their R&D staff. Given the complexities of parallel negotiations conducted thousands of miles apart, the survey yielded some remarkable similarities among the respondents. The two national samples of R&D staff were broadly comparable in terms of

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Table 4.1 Educational backgrounds of senior officials at the Ministry of International Trade and Industry (MITI) (1988)

Source: MITI 1988

age, sex and position in the authority structures of their organisations. The average age of research workers in both countries was 32 and the sample was overwhelmingly male in both countries. Just over half of the samples in both countries were mainline engineers or scientists without managerial responsibilities (52 percent in Japan and 54 percent in Britain). Of those holding managerial responsibilities in Japan a slight majority were at section manager or above with the remainder at section leader. Although the majority of the British sample were without managerial responsibilities (54 percent), a large proportion of these mainline engineers or scientists might be assigned assistants. Of those with managerial responsibilities, the majority were in charge of a group of qualified staff, with only a relatively small proportion responsible for supervising other managers. The main differences in the two countries’ samples came in their educational backgrounds and their current areas of work. Over 68 percent of the Japanese sample had a postgraduate qualification, typically a two-year master’s degree (over 60 percent of the sample), with only a small percentage of doctorates (7.4 percent). In the British sample 49 percent had postgraduate qualifications; however, these qualifications were gained through a variety of routes, from

Source: International Survey of R&D Workers

1 Data for 1987, and exchange rate of ¥240=£1 used.

Table 4.2 Basic data on sample survey companies in Japan and Britain1

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one-year diplomas (4.5 percent) to one-year master’s degrees (13 percent) and doctorates (27 percent). The most significant differences in area of work lay in the much larger proportion of the Japanese sample engaged in research compared to development, whereas the reverse picture emerged in the British sample (see Table 4.1). Nearly two thirds of the Japanese sample reported that they were at the research end of the R&D spectrum whereas less than one third of the British sample were engaged in scientific or technological research. On the other hand less than one third of the Japanese sample were engaged in design or development whereas half the British sample worked in this area. However, there were large variations across the companies in proportions of our respondents along the R&D spectrum (see Table 4.2). The proportions in research in Japanese companies ranged from 37.5 percent in ‘J-elec1’ to 90.0 percent in ‘J-drink’. By contrast, the research contingent outnumbered the development group in only one British company, ‘B-chem1’, with 61.5 percent in research. One factor associated with the size of the research effort was the number of doctoratelevel staff employed in the British companies, where the two chemistry-based companies had the largest concentrations of PhD holders in our samples. A larger proportion of the British sample reported that their work lay outside the strict boundaries of R&D—for example in activities ranging from industrial engineering to information processing, or some seconded to sales or technical services. Some quirks and fuzzy edges were inevitable when sampling had to be handed over to busy company managers. Yet these seem slight issues when set against the broad match in the nature of the samples, while the response rates reflected the high degree of co-operation generated by busy managers, engineers and scientists. For our major interest in the conduct of innovation in Japan and Britain, the companies and their R&D staff confirm the significance of lifetime employment. Tables 4.3 and 4.4 show that the overwhelming majority of Japanese staff joined their company immediately after graduation from university, whereas the British companies had a much higher degree of mid-career recruits than the Japanese companies. It is worth noting that the level of retention was high among the British companies, for many surveys of graduate engineers and scientists tended to suggest higher levels of mobility in the early years in employment. If we look more closely at ‘company effects’, we can see in Table 4.4 that, despite variations across companies, no Japanese company had a higher degree of mid-career recruitment than any British company. Even when we compare ‘J-elec2’ —often cited as one of Japan’s most westernised companies and exhibiting a high degree of mid-career recruitment among the Japanese sample (16.7 percent) —with ‘Bchem1’ —a company often singled out for its traditions of long service—midcareer recruitment is higher in the British company (23.7 percent). Corporate R&D In published documents and interviews, the Japanese companies present a general image through the 1980s and 1990s of striking out into new areas of longer-term research with new investments and laboratory reorganisations,

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Table 4.3 Employment mobility (percentage changing company)

Source: International Survey of R&D Workers

Table 4.4 Percentage of the company respondents who joined the company after graduation and the percentage who were mid-career recruits

Source: International Survey of R&D Workers

whereas the main British companies appear to be more preoccupied with tying the R&D effort more closely and more effectively to overall business strategies. The rather different preoccupation with R&D and business strategies have tended to generate rather different concerns for human resource development. Japanese managers have been concerned with the need to develop long-term researchers, whereas the British managers have been keenly interested in how to develop the business and market awareness of R&D staff. Several researchers have commented on significant changes in Japanese company R&D in the 1980s (Imano 1990; Methe 1995). Not only did the companies continue to expand their R&D efforts, but the creation of many central R&D laboratories with the declared aim of undertaking basic research

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suggested a qualitative change (Wakasugi 1992). Japanese companies have organised their R&D activity into three types of corporate institution: the central R&D research laboratory, usually established with at least 50 percent of its funding guaranteed as core funding from central corporate funds; the applied R&D laboratory, usually funded largely by a business or product division; and the production laboratory, attached to factories with the aim of improving production or process technologies. Imano noted two waves of central laboratory creation in the 1960s and the 1980s (see Figure 4.1). The first wave coincided with changes in Japanese government policy, especially the withdrawal of general support for imported technology in favour of support for more selective programmes. This carried the implication that companies should establish their own central laboratory to manage their own acquisition and development of technology. The establishment of the basic research laboratories in the 1980s has been interpreted as a response to the arrival of Japanese companies at the technological frontiers after years of technological dependence on their Western rivals. All these events have stimulated much debate for a new generation of researchers, about the need for new patterns of human resource development for the basic research laboratories (McCormick 1991; JPC 1987). For example, it has been argued that companies will need to add more active mid-career recruits in contrast to their past emphasis on life-time employment, that they will need to consider more differentiated pay scales for specialists rather than the past all-embracing comprehensive scales, and to develop new dual-ladder promotion systems along professional and managerial ladders. In sum, the new directions for R&D prompted debates about the need for new institutional arrangements in education, training and employment in Japan. Electronics The vertical structure of the electronics industry can be distinguished into components, equipment, systems and applications. The basic components are incorporated into equipment. In turn, units of equipment are incorporated into systems. In similar fashion, systems are directed to applications. The general wisdom is that greater product diversity and greater added value comes with the move upwards from components towards applications. This carries the implication that an increasing proportion of R&D expenditure can be expected to be moved towards applications and the premium skills can be expected to lie in systems and applications skills. The British-owned electronics companies have followed this general trend. They have tended to move away from component and equipment manufacture and to rely on foreign supplies, and to move towards the design and supply of systems and applications. By contrast the major Japanese electronics companies have tried to maintain strengths as integrated suppliers across the chain from components to applications. With the rise of the yen exchange value in the 1980s many of the Japanese companies have been intensifying the location of their manufacturing overseas, including

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Figure 4.1 Number of research institutions established by Japanese companies Source: Imano (1990)

in Britain. Therefore one of the ironies of present trends is that Japanese companies manufacturing in Britain can become the suppliers of components and equipment needed by the British-owned companies who are concentrating on systems and applications. One further contrast between the electronics industries of the two countries is that the British electronics industry has had a larger relative share of its activity linked to government and defence requirements and a much lower proportion of its activity linked to mass consumer electronics. These differences in the development and activities of the electronics industries in Britain and Japan mean that exact matching of companies is impossible, and this is evident in the companies sampled for the ‘International R&D Workers’ Survey’, where industrial differences are reflected

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in the sample companies in the role of company R&D and the skills which companies are seeking to develop. ‘Electronics’ has become almost synonymous with ‘high technology’ because of the scale, speed and scope of its influence not only among producer companies but also among a wide range of applications in other industries. Therefore all three electronics companies in the survey boast proudly of their technological excellence as well as their economic performance and growth rate, and refer to the central role of company R&D in their company business strategy. Japan’s electronics industry reflects the twin aspects of technological development through imported technology and indigenous development. Although Japan was a ‘late developer’, the emergence of a Japanese electronics industry was aided by the craft tradition of manufacture in pre-industrial Japan and the fact that the early electrical companies in the late nineteenth century were not so late in establishment behind the technologies being developed in Europe and the US (Odagiri and Goto 1996). The two Japanese companies were examples of high-technology companies which spanned the range of electronics activities, although in different proportions. The main activities of company ‘J-elec1’ spanned the three main fields of communications equipment, computers and electronics devices, while consumer electronics accounted for only 5 percent of sales. By contrast company ‘J-elec2’ was a major producer in the world’s consumer electronics markets with video cassette recorders, TV’s and audio equipment responsible for over 84 percent of sales. Yet although they were engaged in different markets both companies are strongly committed to R&D expenditures as part of their business strategy. Over the 10 years between 1975 and 1985 in the two companies, ‘J-elec1’ and ‘J-elec2’, sales grew by 461 percent and 347 percent, R&D investments by 657 percent and 595 percent, and R&D as a percentage of sales averaged 11.5 percent and 7.8 percent respectively. Incorporated in the late nineteenth century as a joint venture to import and sell Western telephone equipment, ‘J-elec1’ was largely known as a communications company until the 1970s. During the 1930s, the Japanese shareholding increased and the foreign shareholding began to diminish. In the post-war years the zaibatsu stock was sold to the Japanese public, although other group companies retained a substantial holding. In the 1950s, the company began to diversify its business lines, adding first computers and then semiconductors to its original communications equipment interests. Communications systems were still the mainstay of the business until the late 1960s, however. By the end of the 1970s, semiconductors and computers became more significant in both R&D and business success. For much of 1970s, growth in profitability was hampered by slower investment in the national telecommunications system, the effects of the oil crisis, and the drain of increasing capital expenditures and R&D in computers and semiconductors where expansion had been inhibited by the oil shock. At the end of the 1970s, both computers and semiconductors were making significant contributions to enhanced profits and by the early 1980s the company

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reorganised itself to be a well-balanced manufacturer of electronic devices, computers and communications equipment with a strong market-share position in all three fields. In parallel it had reduced its dependence on sales to Japanese government agencies—for example from 24.8 percent of total sales in 1976 to 18.2 percent by 1981. The growth of the strong market shares in each of the areas was based on the superior R&D facilities. During the 1980s, a guiding theme has been the match between developments in computer and communications technologies —for example in the increasing closeness and similarity between the mechanisms of electronic switching systems and computers or the tendency to distribute the functions of computers using communications circuits and the company’s own strengths in each of these fields. Thus the company is presenting itself as a company focused on the generating, processing and relaying of information. Given that the company elected not to go down the path of plugin IBM compatibility it has had to commit itself heavily to the development of its own software. While this has been burdensome, it has opened the possibility that ‘J-elec1’ might be able to overtake IBM in some areas of fundamental technology. The parallels between convergent trends in technological developments and the philosophy of integrated manufacturing operations from elements to systems were seen as both quintessentially Japanese and consistent with Japan’s needs for a decentralised information network as it makes the transition from being an industrial to a post-industrial society. R&D in ‘J-elec1’ is spread across the three main technologies in semiconductors, computers and communications and across the spectrum from basic research to product development. Each year the image of a high technology company is promoted in the annual report with lists of ‘highlights of research and development’. The company’s ratio of R&D expenses rose from 3.4 percent in 1976 to 4.8 percent (1980), 10 percent (1984) and 16 percent (1988). In the years from 1976 to 1980 computers and industrial electronic systems were responsible for 47 percent of company R&D expenditures, semiconductors for 26 percent and communications systems for 24 percent. By the early 1980s, company ‘J-elec1’ employed over 6,000 engineers and scientists in R&D, about 9 percent of its total employees. They were located in two types of laboratories: corporate research laboratories and production engineering laboratories. The corporate research laboratories (the focus of this research and the source of company sample survey respondents) were divided into six groups: basic technology research laboratories; opto-electronic research laboratories; communication and computer laboratories; the software product laboratory; the resources and environmental protection laboratory; and the scientific computer centre. The production engineering laboratories in ‘J-elec1’ are responsible for design and improvement in its own production processes. For example, they have been responsible for the application of robot assembly systems for integrated circuits and communication equipment, laser welding equipment, and so on.

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Where company ‘J-elec1’ has been associated with Japan’s industrial development since its beginnings in the Meiji era (1868–1912), company ‘Jelec2’ is essentially a post-World War II creation. It was established by inventorentrepreneurs amid the rubble of Japan’s immediate post-war years. From these origins business analysts have often labelled the ‘J-elec2’ company as an ‘atypical Japanese company’ (even ‘un-Japanese’), differing from older Japanese companies along a number of dimensions in its financial structure, business strategy and personnel policies. Yet while it is tempting to ‘explain’ these inter-company differences in terms of entrepreneurial personalities, some of the differences can be attributed to the timing of its formation, the speed of its very rapid growth and its technology intensity. Thus it can argued that to achieve success any other Japanese company facing these three factors would have opted for similar policies and practices, and comments about unJapaneseness or explanations of strategy and structure in terms of colourful personalities seems to be a very partial interpretation. Technological strengths and astute marketing have been at the core of company success in bringing a stream of innovative products to world markets. Arguing that innovative products need institutional supports which foster variety and difference rather than consensus, ‘J-elec2’ has been more reliant on private backers and the stock exchange than the large company groups, or trading companies, or the banking system. Again, with rapid growth and its need for advanced technological skills, the company has recruited outside talents to a degree uncommon among the older large corporations. Although the ‘J-elec2’ company has been tightly focused on audio and video communications primarily for consumer markets and only secondarily for industrial markets, its innovative success has been attributed to its coverage and competence in the full range of technology necessary for its products, including semiconductor devices, magnetic tapes, magnetic recording heads and cores, colour picture tubes, electronic circuitry, audio components, and related production equipment. The record of technological achievement and lists of ‘firsts’ in innovative products is not an unalloyed record of success, however; there are instances where obdurate commitment to a technology in a proud company led to market failures in particular product lines. For the future, the company is emphasising its competence in integrating audio and video system capabilities for entertainment and educational markets and R&D expenditure was estimated to be over 7 percent of sales for 1989. In ‘J-elec2’, a corporate R&D laboratory was established in 1961 to examine basic physical properties and processes, followed by an audio technology laboratory in 1972. In the 1980s some additional R&D facilities were established overseas. Despite some criticisms that Japanese electronics companies have merely set up ‘screwdriver operations’ at their overseas sites, keeping core R&D plants and personnel firmly with Japan, the ‘J-elec2’ can point to a natural history of development for overseas operations from sales outlets to service support, to manufacturing facilities, and eventually to overseas R&D. It was one of the first Japanese companies to establish production facilities overseas

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close to its markets in industrial economies in the 1960s. The move of production overseas has accelerated in the 1980s with the search for low-cost production facilities in southeast Asia as well as for locations near markets. Of the total world employment figure of over 40,000 employees in 1988, approximately 15,000 were employed in Japan. During the mid-1980s, of these 15,000 employed in Japan, approximately 1,500 were engaged in R&D. These R&D staff were roughly distinguished into 350 engaged in research and the majority of 1,150 were engaged in development. The origins of the British company ‘B-elec’ lay in a two-man partnership in the early post-war years and it has echoes of the formation of the Japanese company ‘J-elec2’. From these modest beginnings in radio communications, ‘B-elec’ grew by organic growth and acquisition to be a diverse company with sales across security products (31 percent), data communications (22 percent), specialised business activities (14 percent), defence, radar and avionics (10 percent), radio communications (10 percent), marine and energy (8 percent), and telecommunications (5 percent). R&D activity in the company is strongly shaped by this diversity and the underlying ‘B-elec’ company business philosophy. For the most part R&D is essentially advanced design and development conducted within the autonomous companies geared to provide quick responses to customer requirements. Recognising its difficulties in competing against much larger competitors in the increasingly difficult defence industry during the 1980s, the company devised a strategy of investing heavily in high value-added services which could compensate for traditional products— for example, grafting more electronics on to the mechanical engineering base of its security companies. In reviewing their core competence some of the constituent companies were coming to define their companies as essentially ‘systems design companies’, as the manufacturing companies were being severely rationalised and upgraded. The British electronics company ‘B-elec’ is organised into a large number of relatively small and compact and relatively autonomous companies. There were over 80 in the British group with an average size of 300 employees. In these companies, the R&D activity was best described as advanced development. At the research end, however, there were three centres. One company acted as a research centre offering both commissioned research and undertaking corporate research for the whole group of companies. There were two smaller centres which offered specialist research for specialist technologies for particular companies in the group. The research centre employed 150 staff, of whom 100 were professional engineers and scientists. Two thirds of the budget came from sponsorship by other companies in the group and one third from corporate funding. The two thirds was negotiated between research centre technical management and the sponsoring company, not only in terms of cost but also for consistency with the research centre terms of reference; a potential trap is to avoid becoming ‘extra hands to a development effort’. The nature of development organisation can be illustrated by two companies. The first company produces navigation systems and the total staff of 750

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includes 160 in the development area, of whom about 50 are graduate-level engineering staff. The second company produces radio products and communications systems and the total staff of 350 includes 150 engineers in the development area. Design and development activity may be undertaken as private-venture work and some as contract work. When entering a new field the development company may commission some gap-filling research from the research company. Some of the most obvious contrasts between this British company and the two Japanese companies lies in the extent to which head office departments can provide a directing role in technological development and human resource management. In the British company, the centre’s controlling role is much weaker but advantages are claimed for the capacity to foster business and technological innovation through the very decentralised structures. Telecommunications The telecommunications companies of Britain and Japan, including the sample companies ‘B-com’ and ‘J-com’, have been deeply affected by profound technological, economic and political changes in recent years. Historically the R&D organisations of both companies have served as ‘national laboratories’, implying close links with government, other companies and universities. Neither company had a manufacturing arm which meant that they (and their R&D facilities) had a pivotal role in the development of the telecommunications industry in association with other manufacturing companies. Privatisation and the deregulation of telecommunications in both countries have brought a reassessment of the role of company R&D and a search for a more marketoriented R&D with new linkages between the respective R&D organisations and the other parts of the company and industry. The predecessors of the R&D organisation in ‘J-com’ can be traced back to the 1890s and the Meiji government’s determined bid to industrialise and modernise Japan. The laboratories became a vital component in the importation and diffusion of Western technology into Japan, and it played an important of role in the development of an indigenous telecommunications capability for Japan. The central mission of the research laboratories is focused on the development of telecommunications-related technologies and systems for the ‘J-com’ and its customers and on basic research for the long-term future. The increasingly closer synthesis of communications and information technologies has shaped a medium-term R&D strategy, promoting the construction of a full digital network; the implementation of intelligent machine-processing techniques; the application of nanometer and nano-second electronic technologies; and the introduction of advanced opto-electronic technologies. In the 1987 financial year approximately 2.8 percent of the operating revenues (¥149.3bn) was used to sustain over 5,000 researchers and support staff in the ‘Jcom’ laboratories (compared to ¥136.2bn or 2.7 percent of sales in 1986). A steady increase in the resources committed to R&D brought the figures to ¥181.7bn in

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1988 (3.2 percent of operating revenues 1988), ¥221.7bn in 1989 (3.8 percent of operating revenues), and¥248.0bn in 1990 (4.1 percent of operating revenues). By 1990 the manpower figures had risen to 7,300 researchers and support staff. Following privatisation there have been two major restructurings of the ‘Jcom’ R&D organisation, both intended to produce a more market-oriented laboratory system. In 1985 the four R&D locations, which reflected a regional structure, were regrouped into nine functionally-based technology laboratories. In 1987, reorganisation was carried further by regrouping the nine laboratories into 11 laboratories defined even more closely by individual areas of technology. This second reorganisation was intended to cut the lead time between basic R&D breakthroughs and product development. With the second reorganisation, basic research was separated from applied research by the creation of a separate laboratory, and staff were transferred to the department or service sector corresponding to their expertise with the aim of promoting participation in the commercialisation of technological developments. Thus by 1990 3,000 scientists, engineers and technologists were working in one of the 11 functionally grouped telecommunications laboratories, while the remaining 4,300 staff of the company’s total R&D staff were working in a development centre or an applied research section in one of the ‘J-com’ business divisions. Two further centres were established with the aim of developing practical network systems. Further steps were taken in the reorganisation to strengthen the co-ordination of R&D programmes. The ‘J-com’ R&D headquarters is located within head office and attempts to provide co-ordination for the group of laboratories to operate as a single, integrated research organisation. Consultation with the head office technical strategy office is intended to fashion long-term R&D plans to meet the needs of ‘J-com’ divisions. These plans provide guidelines for policies, strategies and resource allocation. About 20 percent of ‘B-com’s R&D is carried out within one of the four operating divisions, mainly on short-term work to update or enhance existing systems. The main part of the remaining 80 percent is accounted for by the central research laboratory. The central research laboratory received its funds from operating divisions (65 percent), corporate core funding (30 percent) and other organisations (5 percent). The latter includes funding through collaborative research schemes on a UK and EC basis and a small amount of contract research for other organisations. The central research laboratory spends about 60 percent of its funds internally and puts out the remainder as contracts to universities and industrial centres. A rough distinction between the time scales of ‘R’ and ‘D’ is that ‘R’ may be five years plus whereas development projects are two to five years. Beneath the laboratory director of the central laboratory there are six main groups. Grouped beneath these broad fields are the 30 divisions. These range from 460 to 49 employees while the average size is about 300. The management structure is rather like a ‘civil service’ type of grade structure while R&D project management is matrix-based research. Some divisions operate by ‘management by objectives’ whereas this would not work for other divisions where objectives are too diverse.

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In ‘B-com’, job assignments officially rest on project-leader nominations to the project. Within any project there will be a list of sub-themes which are not officially open to researchers, but which informally are open to negotiation. Staff engineers can declare their interests and the project leader will know what they have done in the past. Chemicals Both ‘J-chem’ and ‘B-chem1’ were formed out of the chemical activities of their petrochemical parent companies, ‘J-chem’ in the 1950s and ‘B-chem1’ in the 1960s. Therefore, although the two companies were relatively recent in a formal sense, their parent companies stem from the late 19th century and their involvement with scientific laboratories in the oil side of their business has a lengthy pedigree. From the optimistic formation of ‘B-chem1’ in the 1960s, the 1980s became a very bleak period with doubts about the continuing commitment of the parent company to its chemical offspring. With a depressed market and concern about over-capacity in the European chemical industry there were fears about possible divestment. However, the parent company decided on a determined commitment to areas of technological strength and divestment in areas in which it was relatively weak and in which it had little scope for growth. Therefore divestment and exchanges of productive facilities occurred, but in the restructured company R&D is seen as a central element in the concept of technological strength in its chosen fields of business activity. ‘B-chem2’ was the only company in the wider group to have its own R&D laboratories (of which there were seven) since the other group companies used the Central Laboratory of the petro-chemical parent company. Therefore ‘Bchem1’ had some discretion in assigning some projects to either one of its own seven laboratories or to the corporate Central Laboratory. In addition it could fund research in universities or other commercial bodies. The corporate group Central Laboratory employed 1,400 staff, of whom 450 were graduates. Two thirds of the Central Laboratory budget came from sponsorship by the operating companies and one third from corporate core funds for longer-term fundamental research in areas of current interest or potential for future diversification. ‘Bchem1’ originally established its own R&D laboratories to support the rapidly changing technology of petrochemicals at production sites. From this start on production- and applications-oriented R&D, an increasing amount of exploratory research was being undertaken by the 1980s. ‘B-chem1’ employed 800 staff in seven laboratories spread across the UK (three), continental Europe (three), and the US (one). The UK laboratories ranged in size from 120 to 170 staff. Funding for the laboratories was drawn from the businesses into which the company was streamed, with 80 percent of the funding sponsored by one of the businesses, and the remaining 20 percent coming from the corporate funds of the ‘B-chem1’.

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The other chemical company in the sample, the British company, ‘B-chem2’, had its roots outside petro-chemicals and it was in essence a cluster of speciality chemical companies. With a total UK employment of 2,500, ‘B-chem2’ organised around three divisions which covered the small companies which made up this chemical company in 1973; another 1500 employees are in the US. The R&D effort is closely linked to production sites. The company is increasing R&D investment in the speciality chemicals areas which have developed partly by organic growth and partly by acquisition and it was moving to distinguish the original technical support functions from the new R&D. However, it appeared unlikely to establish a central R&D facility and the speculation was ended when the parent company sold off ‘B-chem2’ to a continental European chemical company. The chemical industry in Japan grew rapidly in the ‘high growth era’ (1955 to 1973) but it encountered a range of severe problems by the mid-1970s. These problems included: the anti-pollution movements; a lack of cost-reducing innovations; the rising cost of borrowing; the increasing ability of developing countries to produce some of their own chemical products; and the deficiencies in resources and energy dramatically highlighted by the oil-price increases. The structure of the industry made for difficulties in adjustment. Of the 20,000 chemical companies in Japan, most were operating in processing a single product with fewer than 50 employees. However, the large companies began the business diversification from raw materials production to final products which is evident in the R&D programme of ‘J-chem’. The ‘J-chem’ company was created in the mid 1950s as one of the chemical companies in a keiretsu group, which in turn had been re-fashioned in the postwar world from one of the major zaibatsu. Now it operates as a comprehensive chemical company, with 20 percent of its sales coming from speciality chemicals. The initial response to the oil shocks had been to use R&D to seek process improvements, but later the emphasis changed to seek new products for diversification, particularly speciality chemicals. In 1988, it announced a 15-percent increase in R&D outlays for the coming year, with a view to increasing the share of its sales coming from speciality chemicals, particularly those related to electronic materials. From 1987 the company planned to maintain R&D expenditures at approximately 6 percent of net sales over the coming five years, with 85 percent of these funds being committed to work on the speciality chemicals. By the late 1980s, company literature was beginning to emphasise a research programme beyond petrochemicals into the biosciences and new materials fields. The textile companies The textile industry was almost synonymous with the Industrial Revolution in Britain, the pioneer industry in the pioneer country. As a child on the borders of industrial Lancashire, I saw much of that historical legacy from the 1840s cotton worker’s house in which I lived to the school trips and observation of

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ring spinning, even mule spinning and steam-engine power. The textile industry was important in the industrialisation of Japan too, and the sight of 1880s Mather & Platt machinery in the Kurabo Museum in Kurashiki is an eerie testimony to British involvement in Japan’s early industrialisation. Both the textile companies had long histories intimately associated with the formative years of their respective industries. For convenience, I have used the labels of textiles for these two companies, but the company activities covered a much broader range of activities than would normally have been understood from textiles and for whom R&D has been an important aspect of diversification. Indeed, much of the R&D activity engaging our sample of engineers and scientists has been outside the textile area. While Japan’s textile industry shows the mix of imported and indigenous technology evident in other industries in Japan, ‘J-fibre’ has been somewhat unusual in being strongly on the indigenous technology wing of the industry and seeking growth through organic means rather than acquisitions. It started as a manufacturer of synthetic fibres in the early decades of the twentieth century, and was among the first Japanese companies to develop independent manufacturing technologies. By the mid-1980s, the Japanese synthetic fibre industry had a number of ills from stagnant domestic demand to severe competition coming from Taiwan and South Korea. MITI was encouraging ‘Jfibre’ and other companies to find a remedy through mergers. However, ‘Jfibre’ and other fibre makers recoiled from the bitter pill of a merger and preferred the route to health through product diversification. Product diversification had been underway in ‘J-fibre’ for many years. In the early 1960s, the company had established a chemicals and plastics division, and later, a petro-chemical company. In the early 1970s, ‘J-fibre’ had tried a risky route to diversification through oil exploration, but a series of failures prompted an alternative path through pharmaceuticals. Thus in the late 1980s, the company operated through five divisions. Three divisions included the three core business activities in fibres, chemicals and plastics, and the medical and pharmaceutical division. The importance of R&D, the ‘key to “J-fibre’s” business strategy’ according to an annual report, was recognised by its organisation into a fourth division, while general administration accounted for the fifth division. The first R&D laboratory, created in the early 1950s, had become the production technology laboratory by the 1980s. Meanwhile, a new research laboratory, created in the 1960s, had become the corporate R&D centre. Each of the divisions had its own R&D centre. The plastics and the fibre and textile laboratories were created in the 1960s and the bio-medical research institute was created in the 1970s. Where ‘J-fibre’ had experienced organic growth, ‘B-fibre’ had grown from its origins in the early nineteenth century by a mix merger and acquisition, as well as organic growth. Determined efforts in the 1960s and 1970s had turned a collection of fibre and textile businesses into a huge, vertically integrated industrial group covering fibres, textiles, coatings, films and packaging, with

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additional activities in woodpulp, fine chemicals and advanced materials. In the 1980s, it was one of Britain’s largest companies, although much smaller in employment terms at the end of the decade than at the beginning after the job cutting in the 1980–83 recession. Yet annual reports in the late 1980s stressed the continuing search for acquisitions which fitted existing strengths and reinforced the cohesiveness of the group’s portfolio. Cohesiveness across the group proved too difficult to sustain. By the close of the decade, the textile side, which had been managed independently from the chemicals side, was demerged. The split created two companies: on one side, the textiles activities (clothing, fabrics and spinning) and on the other side, the more chemicalsbased activities (fibres and films, coatings, packaging and speciality chemicals). While the de-merger left two large companies, the chemicals company was small by international standards. The overall aims were to reduce the proportion of business in bulk chemicals and increase the proportion in speciality chemicals in order to gain the benefits of higher margins, greater insulation from cyclical factors and more international markets with less vulnerability to UK recessions. The diversity in the range of products and businesses had prompted the adoption of a very decentralised corporate structure. However, the company not only retained but continued to expand the central research and technology group which had been built up in the 1980s. ‘B-fibre’ operated three centres for R&D: a central R&D facility for the group and two further centres which specialised in particular technologies. The central laboratory had 700 staff and the two smaller laboratories a further 300 and 120 staff. About 80 percent of the CRL funds came from business divisions and 20 percent from corporate core funds. The size of the company shaped the R&D philosophy, expounded by the research director as operating in ‘shirt sleeves rolled-up style’ since it was always necessary to understand the fundamental processes rather than rely on empiricism, but impossible to carry a large portfolio of ‘blue-sky research’. The food and drink companies Both the food and drink companies in Britain and Japan have had several centuries’ of involvement with science and technology through the brewing industry. From the 1980s, however, R&D began to form an important part of the diversification programmes of both companies. In the short run, it was recognised that the companies could be profitable on beer sales without R&D and the R&D outlay appeared tiny as a proportion of total sales. On the other hand, both companies have perceived a problematic future for their beer sales. In Japan, the domestic beer market is seen as a relatively mature market in the face of slower economic growth and changing consumer tastes. ‘J-drink’ faced additional problems of declining market share in the face of more aggressive new product development by competitors. Although new products such as soft drinks and food products were being developed, the company was still dependent on beer for over 90 percent of sales in the late 1980s. Therefore

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future plans were developed for the expansion of overseas activities through bold marketing in the US and Europe and diversification through new products. Originally established on the company traditions in brewing science, the R&D department was set up in 1943, but by 1967 an applied bio-science laboratory was distinguished from the brewing-science laboratory. In 1986 a major reorganisation was undertaken to found the brewing-science laboratory, the pharmaceutical laboratory and the plant bioengineering laboratory. Meanwhile the head office involvement with R&D was consolidated with the formation of a life sciences group, a pharmaceuticals group and a seed-andplant business group. Using overseas representative offices, attachments to domestic and overseas universities and links with foreign companies, the company is actively seeking to promote its pharmaceutical and life science/ biotechnology activities. In both Britain and Japan, the beer companies are sensitive to public perceptions of their activities and the beer trade. ‘J-drink’ hitched itself to environmental concerns under the slogan ‘clean and green’, illustrating its role as a ‘corporate citizen’ in the design of its production facilities, sponsorship of sport (and hence health) and cultural activities. For its part, ‘B-drink’ is sensitive to public concern about a range of alcohol abuse and the potential for government legislation hostile to the brewers. Therefore it also projects a positive image of its relations with society, conceived synonymously as ‘community’ and ‘marketplace’, emphasising its sponsorship of community programmes, and sporting and cultural events. While these concerns might stimulate an interest in non-beer activities in themselves, it is the structure of markets which prompts the diversification efforts of the British food and drink company. The economic and social structures of both the distribution system and the leisure industries shape the direction of diversification and the form which it is taking —hence the role of R&D policy in support of the business strategy. By the late 1970s, the five major British brewers had achieved a 70 percent share of the British beer market. Given a relatively stable market for beer, the British brewers have taken on a twin-pronged diversification programme. British brewers have controlled many of their retail outlets, the pubs, as ‘tied-houses’. Therefore the first plank of diversification has been to expand the non-beer aspects of their pub trade by selling more soft drinks and food. The second plank of diversification has been to expand the non-pub business, typically into restaurants, hotels and holidays not only in Britain but in mainland Europe and North America too. The extent of diversification means that the shares of profits attributable to food and to beer are 8:5. R&D forms part of the diversification programme because new sections have been added to brewing science to enable R&D in the areas of nutrition and ventilation in order to develop new products—in particular the menus and environment of the new pub and restaurant business. With a total research budget of £4m set against total sales of £1,554m, ‘Bdrink’ company reflects the general pattern of low research intensity in the food and drink industry. The brewing companies would be profitable without R&D.

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However, ‘B-drink’ R&D managers had clear ideas on the ways in which R&D can enhance profitability. A total of 60 staff were engaged in R&D, divided evenly between research and development and located mainly in the central technical centre. Further company R&D was carried out by directly employed staff located on a university campus, collaborative research was funded on another university campus, and collaborative, pre-competitive research was funded through a research association with other companies. Funding for the technical centre came mainly from commissioned R&D for business divisions (90 percent) supplemented by a small budget (10 percent) from corporate core funding. Project organisation While heroic images of the solo efforts of independent inventors still have a powerful hold on public images of engineers and scientists, most contemporary R&D work is carried out in teams. Therefore organising and managing teams is one of the critical areas in the pursuit of innovation by large corporations. Yet closer examination of the more micro-level of exploring project organisation in companies in our two countries (for example, staff assignments to projects or the selection of project leaders) reveals the influence of the larger framework of national institutions. The importance of teams was borne out in the International Survey of R&D Workers where very few R&D staff members worked solo on their projects in either country (8.8 percent in Japan and 5.8 percent in Britain). Project teams of three to seven members were the most common size of project team in both countries, with very few respondents engaged in very large teams of over 50 members. Although ‘teamwork’ provided the main organising principle for the daily worklife of corporate R&D staff, there were a number of significant differences in the way that projects were organised and experienced among our national samples. Many of these differences were intimately bound up with the practice of the lifetime employment system in Japan. The process of assigning R&D staff to projects revealed marked differences in project organisation. Just over half the Japanese sample compared to a quarter of the British sample responded that they had been selected for the project by their immediate supervisor. Differences were again evident in the extent to which the R&D staff had personal influence over these allocations compared to assignment by the director or a senior administrator of R&D. Japanese respondents were much more likely to claim self-selection compared to their British counterparts (16.9 percent compared to only 8.9 percent). On the other hand, it was much more likely that the individual R&D staff member had been allocated to the project by more senior management in Britain than in Japan (29.8 percent compared to 17.7 percent). The general picture of greater consultation on staffing decisions in the Japanese R&D laboratories was further corroborated when we examined the extent to which personal R&D interests were considered in project planning. It was much more likely that individual interests were given considerable weight in Japanese laboratories compared to

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British laboratories (32.8 percent compared to 19.6 percent in Britain). On the other hand, a much larger proportion of the British respondents (41.2 percent) compared to the Japanese respondents (11.7 percent) claimed that their personal R&D interests were given negligible weight in planning projects. These features of project staffing are consistent with the characterisation of Japanese management as a ‘bottom-up’ (ringi seido) process compared to more authoritarian ‘top-down’ processes in Western countries. However, some caution is needed before simply contrasting the peculiarities of the Japanese with a homogenous ‘West’. Adding the data from the US and Germany on ‘selfselection’ to project themes yields the following pattern: 23.4 percent of US staff, 17.3 percent of German staff, 16.9 percent of Japanese staff and 8.9 percent of British staff. In this wider context of comparison, it seems more appropriate to note the ‘peculiarities of the British’ rather than those of the Japanese. The British laboratories exhibited a further idiosyncrasy in the narrower range of departments from which project team members were drawn compared, not only to Japan, but to Germany and the United States too (Yahata 1995:37–8). It suggests that both the British companies and their R&D staff were the deviant cases rather than their counterparts in other countries. There is an apparent paradox in the British responses when the surprisingly large proportion of the British R&D staff who claim direct responsibility for project planning (45.9 percent) is set alongside these earlier responses on project allocation and the consideration of interests. It seems that British R&D staff are assigned to their project tasks with relatively little consultation, but then are left relatively free in the day-to-day planning and execution for their work. Unfortunately our comparison of the two national samples on this dimension is complicated by differences in the wording of questions. Where the British questionnaire referred to ‘project planning’ the Japanese questionnaire referred to the ‘initiation of projects’, rendering the responses of the two samples not strictly comparable. The Japanese sample responses on project initiation responsibilities matched fairly closely their responses on the extent to which personal interests are reflected in project planning. Taking together other interview discussions and research material the general impression is that the Japanese sample have relatively more influence over project assignments and consideration of their personal interests than their British counterparts, but that they have much less discretion over how they carry out their day-to-day duties. Alternatively, the British R&D staff have relatively little say over the tasks to which they are assigned or the extent to which these tasks match their interests, but they are much more likely to be left to get on with their tasks in their own way on a day-to-day basis. In corporate laboratories world-wide, project leadership is acknowledged to be of critical importance and appointments are widely believed to reflect technological ability and experience. However, in practice the influence of the lifetime employment system again marks Japan out from other countries where it can be seen in the apparent importance attached to seniority in project leader assignments. Using the International Survey of R&D Workers data, Yahata

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showed that there was a close correlation between age and position among Japanese R&D staff. Moreover, there was a much greater difference between the average age of project leaders and team members in Japan (9 years) compared to Britain (4.1 years), or even compared to the United States (3.8 years) or Germany (4.5 years) (Yahata 1995:27). In exploring perceptions of the criteria important in selecting leaders, Yahata suggested that Japan is again markedly different from the three Western countries: Britain, Germany and the United States. Japanese R&D staff put a high premium on the ‘ability to organise team members’ and evidence of ‘project planning ability’ among those selected for leadership in higher positions, indicating the importance of developing junior team members and developing R&D themes. By contrast, British, German and American staff put emphasis on ‘trust and reputation among team members’, which was given little attention by Japanese respondents. For Yahata, the different national responses reflect different principles of organisation adopted in the four countries: Organisations based on individuality and personal initiative of researchers in the United States, Britain and Germany require leaders whom team members can trust. In Japan, on the other hand, even a project team must have a sense of community in which members are equal and complement each other in making progress (to optimise the multiplication effect through competition when there too few members). Authority is assigned to a leader who has been selected, based on ability, after a long period of competition, while a certain seniority order is maintained as well. Therefore the leader can display strong initiative in selecting themes and promoting research activities. For these reasons, project organisations in Japan rely heavily on their leadership, and the team leader is expected to display initiative in his or her research and development efforts as well as performing managerial tasks such as helping the abilities of junior researchers and co-ordinating with other departments. (Yahata 1995:35) Despite showing a more widespread feeling of autonomy and discretion carrying out their project work, British R&D staff seem more likely to be involved in shorterterm formal reviews than Japanese R&D staff. In both countries the majority of R&D staff were involved in formal reviews at least over three-monthly intervals (60.1 percent in Japan and 80.4 percent in Britain). However, a larger proportion of the Japanese sample (38.9 percent) compared to the British sample (16.7 percent) were involved in longer-term reviews at intervals of six months or longer. Communication patterns in work show areas of similarity and dissimilarity in the two national samples. In both countries the majority of R&D staff report regular consultations with other sections of their R&D centre (58.6 percent in Japan and 57.9 percent in Britain). However, the Japanese R&D staff are more likely to be involved in regular consultations with either other company R&D centres (24.1 percent) or company headquarters R&D staff (16.5 percent) than

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their British counterparts (17.4 percent and 10.9 percent respectively). On the other hand, the British R&D staff were more likely to be in regular contact with sales (23.1 percent) and manufacturing (35.9 percent) divisions than the Japanese R&D staff (12.5 percent and 19.8 percent). Moreover the British scientists and engineers were more likely to have frequent consultations or discussions with staff in other companies (24.7 percent) than the Japanese scientists and engineers (7.9 percent). This pattern of linkages seems at odds with popular perceptions of closely integrated departmental communications in Japanese companies. R&D outputs: patents and papers While innovative products and processes which contribute to corporate profits are the ultimate raison d’être of R&D funding, patents and papers are among the more important intermediate products of R&D (see Tables 4.5 and 4.6). Since patents provide a mechanism for companies to appropriate the returns to their R&D investment, technology management researchers have looked closely at patent statistics as indices of R&D activity and measures of productivity. The large increase in Japanese patenting has been noted as marking a significant intensification of Japanese corporate R&D efforts. At first glance, the comparative levels of application levels for patents and the numbers of papers produced suggest prodigious efforts on the part of Japanese R&D staff, where 78 percent of Japanese R&D staff have applied for a patent in the previous three years compared to only 31 percent of the British group (see Tables 4.5 and 4.6). Two institutional features lie behind this relative pattern of patenting activity: the Japanese patent system and the company reward systems. Table 4.5 Percentage of R&D staff applying for patents by area of work and country

Source: International Survey of R&D Workers

Table 4.6 Percentage of R&D staff with published papers by area of work and country

Source: International Survey of R&D Workers

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Table 4.7 Percentage of Japanese R&D staff applying for patents by company

Source: International Survey of R&D Workers

Table 4.8 Percentage of British R&D staff applying for patents by company

Source: International Survey of R&D Workers

The search for patents is widespread in Japanese companies, with a much lower level only in the ‘J-drink’ R&D laboratories. By contrast, interest in patenting is heavily concentrated in the two chemical-based company laboratories in the British sample (see Table 4.8). The relatively greater overall Japanese involvement in patents reflects different philosophies and practices underlying the domestic patent procedures in the two countries. Japanese patenting is based on the ‘first to apply’ principle (compared to the ‘first to invent’ principle adopted in the US), where the aims have been to offer a readily easy accessible procedure and a rapid diffusion of inventions in a society whose nineteenth-century and post-war modernisation were heavily based on imported technology and its adaptation (Fukutani 1995). Reflecting these origins and purposes, Fukutani calls the Japanese patent system a ‘utility model’ and points to several factors within it which foster high levels of patent application: first, the scope of a patent application is restricted which encourages additional protective fringe applications; second, small companies can readily enter and so prompt defensive applications by large companies; and, third, the rotation and career development systems often assign former front-line R&D staff into patent departments and their liaison activities stimulate further applications (Fukutani 1995:108–12). The historic traditions have bolstered the use of patent applications as pointers to the technological capabilities of companies and individual researchers. Westney suggests that, as Japanese companies engaged in boosting R&D activity after the oil shocks, many adopted patent applications as performance measures for engineers and scientists and also used patent statistics as indicators of technological competitiveness (Westney 1993a:42– 3). Linking salary reward and career progression to the production of patents and papers is not a peculiarity of the Japanese employment system. Salary appears related to patent applications in Britain too. In both countries, the International Survey of R&D Workers showed that staff involved in patent applications or in publications are more highly paid than those who have not (see Table 4.11). However, the Japanese companies appear to attach much

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Table 4.9 Percentage of Japanese R&D staff publishing papers by company

Source: International Survey of R&D Workers

Table 4.10 Percentage of British R&D staff publishing papers by company

Source: International Survey of R&D Workers

Table 4.11 Reward levels by patent application and publication1

1 The reward levels are based on the country average=100. Source: Davis 1995 (International Survey of R&D Workers)

greater weight to patenting. This becomes evident in the much wider salary differentials in Japan for patents (36.2 points) compared to Britain (13.3 points). A similar pattern of stronger emphasis on measured outputs to guide salary progress in Japanese companies is repeated in differentials evident among publishers and non-publishers among R&D staff, where the Japanese differential is 25.8 points and the British differential is only 15.5 points. (See Tables 4.9, 4.10 and 4.11.) The character and high level of Japanese patent applications have attracted some sceptical comments among British engineers and scientists, evident in some of the comments of respondents in the two higher patenting British chemical companies: [Japanese R&D] appears to be focused on producing a large number of patents. (‘B-fibre’) They have many patent applications the majority of which are not worth doing. To me, this suggests that status and progression within their research is related directly to the number of patent applications without regard to their content. (‘B-fibre’)

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I have no detailed knowledge. One marker of Japanese R&D is the number of patents granted. In numerical terms, the Japanese beat the UK by a huge margin but, in my own field, I know that many of the patents granted are of little significance or the smallest manipulation of basic ideas which will satisfy the examiner as to novelty. (‘B-chem1’) A more measured comment, noting the broad range of research effort in relevant research from the more long-term fundamental to the more applied development areas, came from the R&D department of the second chemicals-based British company: In the fluroaromatic field, [Japan Glass] are producing original work [patents] and are clearly devoting considerable R&D resources. There is generally high activity in organofluorome chemistry. Some patented work is not generally new and some chemical/technological work is longwinded rather than concise. The main impression is therefore great effort and research ranging from ‘blue sky’ to basic process development. (‘B-chem2’) Against scepticism that trivial patent claims are driven wholly by the salary system, a note of caution is necessary. The growth of patenting by Japanese companies is not simply measured by the growth of domestic patents, but by the growth of patents taken out in other countries such as the US and Germany. Analyses comparing the origins of patent applications taken out in the US confirm both absolute growth and growth relative to the activities of R&D staff in other countries. Conclusions Pavitt and Patel have welcomed the concept of ‘national innovation systems’ as a useful attempt to incorporate into economic analysis some of the ‘intangible’ investment in technological learning activities made in business firms, universities, public and private training institutions, government agencies and other institutions, and the links between these institutions (Patel and Pavitt 1993:10). In addition to these institutions, Pavitt and Patel noted the background influence of national differences in finance and management. By looking at institutions, incentives and competencies, they suggest that the different patterns and mixes of the different ‘national systems’ will foster or hinder technological innovation. Their measures of world rankings in basic research and industrial R&D show broad support for the old maxim about Britain’s relative strength in basic research and Japan’s relative strength in technology; Britain stands high in the league table of citations of scientific papers while Japan stands high in the resources put into applied research and development in industry (see Table 4.12). However, they caution that changes in indicators of national

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Table 4.12 A comparison of the world rankings in basic research and industrial R&D

Source: Patel and Pavitt 1993:20

research lagged compared to changes in technological performance and that Japanese scientists have achieved impressive standing in fields of basic science closely related to their areas of technological excellence, and have gone beyond the UK in highly cited papers in physics (Patel and Pavitt 1993:21). Lynn expressed scepticism about the emphasis on ‘the national innovation system’ and preferred to refer to ‘systems’, arguing that much of the work in this field has tended merely to catalogue components of a system rather than demonstrating their effective linkages. Moreover, he argued that the way in which such elements are linked will vary across industries (Lynn 1994). While Lynn proposed a research agenda to explore the generation and selection mechanisms for new technologies among innovation communities, I have focused on the human resource management aspects of the discussion of innovation systems. After reviewing some aspects of the debates about the contemporary Japanese and British national systems, I followed the recommendation of Odagiri and Goto (1996) that more attention should be paid to initiatives of companies in the private sector and the counsel of Lynn that companies should be viewed across a variety of different industrial settings. While all the companies featured in the International Survey of R&D Workers were high spenders on R&D in both absolute terms and relative to the pattern of expenditures in their own industries and countries, there were marked differences of emphasis in interviews and case studies. Japanese managers tended to emphasise company efforts to build long-term programmes in basic R&D, evident in the formation of new central laboratories and company annual

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reports. British managers tended to emphasise their priority in linking R&D more effectively to business streams and demonstrate more effective utilisation of R&D. Taking the examination of the ‘national system’ concept down to the level of corporate laboratories and project organisation illustrates some of the problems of change for Japanese companies. Although much of the speculation about change has dwelt on relations between MITI and the companies, it is clear that the institutionalisation of practices in human resource management in corporate laboratories, from assignment of members to teams, selection of team leaders and managers, to rewards for patenting, have been developed within the context of corporate concerns about promoting development. While the weight attached to seniority has had it strengths in building stable trust relations in teams and laboratories, the price has been paid in tendencies towards conservatism in outlook and a risk aversion in project selection (Yahata 1995). However, to propose changes in the criteria by which staff are promoted and rewarded is to challenge the rationale by which existing company hierarchies have been built. So long as companies appear to have been making some success, it is not surprising that reforms have been approached cautiously and that the debate about the need for change in Japan’s national system of innovation has run a long way ahead of the evidence of change among companies. Note 1 In Tables 4.2 to 4.10, data drawn from the surveys are listed as International Survey of R&D Workers. The basic surveys were published in three comparison sets of British Engineer-Japanese Engineer, American Engineer-Japanese Engineer, German Engineer-Japanese Engineer by JPC in Japanese (JPC 1991a, 1991b, JPC 1991c), while some of the participants published essays in journals. A set of essays by participants was edited by Shapira (1995).

5 Building skills and careers in research and development

Introduction: skill formation and career development This chapter puts the focus on the building of the repertoire of knowledge and skills and their use in the unfolding careers of engineers and scientists. Earlier chapters have provided relevant comparative discussions of the output of engineers and scientists from the Japanese education system (Chapter 2) and outputs from the company training systems (Chapter 3). Chapter 2 demonstrated how some British industrialists became animated when reading accounts of the Japanese higher educational system and its numbers of engineering graduates. They went on to ask how they could be expected to compete with Japanese industrialists until the British higher educational system began to deliver comparable numbers of engineers to support them. However, their preoccupation with numbers of engineers was not only simplistic, but it neglected the chicken-and-egg character of education-employment relations where expectations and experiences of education are very strongly influenced by the nature of the employment system itself. My aim in this chapter is to take the discussion forward with a focus on engineers and scientists working in R&D. Chapter 4 provided the background debate on respective ‘national innovation systems’ and their alleged strengths and weaknesses, especially the concern in Japan that the institutional frameworks outlined in Chapters 2 and 3 might not serve future knowledge and skill needs for innovation at the technological frontiers. In addition, Chapter 4 introduced ‘The International Survey of R&D Workers’ and the data set which gives an opportunity to draw on the views of engineers and scientists themselves about education, training and employment experiences. The central focus of the chapter lies in examining the impact of different employment systems on the kinds of knowledge and skills learned, on the manner in which they are learned, on the ways in which careers are developed, and on graduate employee perceptions of areas of university and company education and training in need of improvement. Using the concepts of an ‘organisation-oriented’ employment system (Japan) and a ‘market-oriented’ employment system (Britain), I will argue that Japanese employers have come to accept a division of labour between employers and higher-education institutions which provides a very academic education for

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university graduates and relies on a heavy employer responsibility for human resource development and training. By contrast, the British higher education and training system appears designed to move graduates very quickly into employment following a relatively specialised education in which the boundaries between academic and vocational elements are more overtly contested. Moreover, the employment system appears to encourage the movement of graduates out of their technical specialities as rapidly as possible. In Chapter 2, I pointed out how these differences in career development in the two countries generated rather different debates about educational reform. On the British side, I noted an increasing tendency to see a move towards more vocationally directed higher education system as the main target for reform. On the Japanese side, I indicated less concern with vocationalism, but more concern with issues of ‘creativity’ and educational variety. The concept of ‘career’ has been one of the fundamental building blocks in the study of work organisation, allowing observers to move back and forth between the individual and the structural. From the viewpoint of the individual, a career carries matters held dearly such as self-image and identity, while a more a structural interest takes in the sequence of related tasks and jobs, their arrangement in hierarchies of prestige and the pace at which individuals move through them. Using the concept of career to explore the responses from the International Survey of R&D Workers, British R&D staff views are best characterised as ‘short term’ in the sense that they are typically the product of a shorter period of full-time education, typically anticipate a shorter time on the road to a variety of ‘career milestones’, and they expect that education and training is more closely geared to preparation for the next stage of career development. By contrast, Japanese R&D staff take the long-term view, a typically longer period of full-time education, taking longer to reach career milestones, and eschewing a less narrowly and less immediately instrumental view of education and training. The central argument is that the relatively short career phase in technical positions anticipated by the British sample derives from an employment system which encourages and rewards moves out of the technical activities into management, and this conception of the unfolding career shapes views of education and training. In neither country can the problems in educating engineers and scientists for industrial R&D be tackled by acting on the educational system in isolation. Employment systems: ‘market-oriented’ versus ‘organisation-oriented’ The contrasts between institutions and practices in employment and industrial relations in Britain and Japan evident in Chapter 3 have been conceptualised as differences between a ‘market-oriented’ employment system and an ‘organisation-oriented’ employment system (Dore 1987:28–31). The marketoriented system is predicated on the assumption of relatively easy mobility between firms for employees (and the corollary of relatively easy hire and fire

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on the part of employers), the notion of a ‘going rate’ for occupational skills, and employee organisations (whether unions or professional institutions) which are based on the assumption of transferable occupational skills and which have an interest in defending or promoting that rate for the job. Dore did not argue that all British employment is wholly marked by ‘market-oriented’ relations— for example, the public sector and some large corporations were said to approximate the ‘organisation-oriented’ model—nor did he argue that all Japanese companies follow the ‘organisation-oriented’ model—for example, the small-firm sector (with the bulk of employment in Japan) resembles the ‘market-oriented’ model. The point at issue is that along a continuum of employment relations the main factors influencing the large-firm sector (the main labour market for graduate-level R&D skills) put the two countries at different ends of the continuum, and that this has important consequences for the way in which education, training and a range of other institutional correlates of employment systems are organised. For example, in these sample firms the contrasts can be seen in the greater emphasis on recruitment directly from graduation in the organisation-oriented system as compared to mid-career recruitment, the greater emphasis on recruiting for a pool of talent as compared to specific jobs, and the greater extent to which responsibility for managing the transition from education to employment is seen to rest with institutions as compared to individuals. The conceptual contrasts between the British ‘market-oriented’ and the Japanese ‘organisation-oriented’ systems are consistent with the employment mobility experiences of the respective national samples of R&D workers in the International Survey of R&D Workers (in Chapter 4). Further confirmation of differences is given in employee expectations about the timing of any anticipated future mobility. Another index of the persistence of the ‘organisation-oriented system’ lies in comparisons of preferences for future employment. One evident contrast between British and Japanese samples is the higher proportion of the Japanese sample which preferred to stay with its current employer compared to the British sample. Yet here caution is needed, for in breaking the samples down by functional area of current work, it is clear that the British researchers were much more likely to anticipate staying with their current employer than the British development staff, and the British researchers were closer to the Japanese patterns (see Table 5.1). On the other hand, looking at the organisations to which the ‘mobile’ might go in Japan, it is evident that they looked to university posts rather than to other companies, whereas the British ‘mobile’ staff anticipated moves to other companies or to establish themselves independently. One factor inhibiting preferences for moves to other companies in Japan was likely to be the sheer difficulty of effecting such moves in an ‘organisation-oriented’ employment system among large companies where premium scarce skills must be offset against lack of local organisational knowledge. If closer attention is given to those employees indicating a preference for a future move to another company, by distinguishing these respondents into age

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Table 5.1 Preferred future (type of organisation) by current work location (%)

Source: International Survey of R&D Workers

Table 5.2 Proportion of each age group preferring a company move by age group (%)

Source: International Survey of R&D Workers

groups in the 25–45 age range another interesting difference emerges between the two national samples. For the British sample, aspirations to move were more likely among the younger engineers and scientists, whereas such ambitions tended to be held (if at all) on a smaller scale and among older R&D staff in Japan (see Table 5.2). In the ‘organisation-oriented employment’ system, employers and employees accept that it is the employers’ responsibility to train and develop their employees, whereas in the ‘market-oriented employment’ system there is a greater onus on employees to undertake responsibility for their own careers and, for some, this implies moves between employers in search of experience and career development in the early career. Career timetables Movement through a sequence of related jobs arranged in a hierarchy of prestige implies both pace and direction in career development, while the concepts of ‘technical’ or ‘managerial’ careers imply that moves are ordered and socially recognised. Drawing on Sato’s (1995) account of the typical moves and time intervals between career stages for the International Survey of R&D Workers, some sharp differences are evident between the patterns of career development in the four major industrial countries (Table 5.3).

Note The negative entries in column g reflect the higher levels of labour market mobility among the British, German and American R&D workers, where some gained their experience in other companies prior to their current employment. By contrast, Japanese R&D workers reached their ‘fully fledged’ status entirely with their sole employer.

Source: Adapted from Sato 1995:48–9

Table 5.3 Career timetables

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Japan stands out as the country in which companies and their R&D workers invest heavily in skill formation. From each point of graduation (whether from bachelor’s, master’s or doctorate level), the time taken to reach the stage of a ‘fully fledged engineer or scientist’ is much longer in each of the other three countries (see column f in Table 5.3). At the ‘fully fledged’ stage the young engineer or scientist has undergone the induction and early employment training and experience which equips him or her to take on R&D tasks with minimal supervision. It is a career milestone readily understood among engineers and scientists even though it is not marked out formally with examination or formal qualification. In Britain, Germany and the US, R&D workers typically estimated this stage took about two years from graduation at bachelor level. By contrast, this period was estimated at much nearer seven years by Japanese R&D workers. Moreover, responsibility for this early training period lies almost wholly with the company entered immediately after graduation for most Japanese R&D workers, whereas the consequences of job mobility mean that companies in the other countries often buy in experienced engineers trained in other companies (see column g in Table 5.3). There is a striking difference in the implication of graduate study in Japan compared to the other countries. In each of the three countries (Britain, Germany and the US), graduates with university postgraduate qualifications see themselves as ‘fully fledged’ on entry to industry (see column f in Table 5.3). However, Japanese master’s degree holders still tend to see the need for over four years of broadening training and experience, while doctorate-course graduates estimate a need of three years of broadening. The other career milestones selected were the ages on becoming a project leader and on becoming a manager. In each case the British sample tended to reach the identified stage at a younger age than their Japanese counterparts. Comparing industrial entrants with only a first degree, the British R&D staff reach project leader almost four-and-a-half years ahead of their Japanese counterparts (see column d in Table 5.3). For similarly qualified entrants, the gap is five years in comparing the ages on reaching managerial status. However, the variation within the British sample’s experience is much wider than the Japanese sample (standard deviation 6.5 compared to 3.28), and this variety in experience stands in contrast to the other ‘milestones’ where the standard deviations in the two samples are very similar. As we saw in Chapters 2 and 4, there has been a rapid growth in numbers enrolled on master’s courses, and this level has become the standard entry level for recruits to company R&D departments. Typically, Japanese graduates with master’s degrees reach management rank at a faster pace and younger age than their bachelor-level colleagues, although it is not clear whether this is attributable to the master’s course or to the higher ability levels of those who enter master’s courses compared to those who enter employment at the bachelor level (see columns e and i in Table 5.3). Some benefit from courses seems evident in the belief of master’s-degree holders that they become fully fledged at a faster pace than bachelor-only degree holders (4.5 versus 6.9 in column f in Table 5.3).

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Japan is not the only country to show a deliberate pace on the path to industry and management rank. German R&D workers are the oldest on average on entry to employment compared to their counterparts in the Japan, Britain and the US. Even though they feel well-equipped to cope with work requirements, to judge by the relatively short time they feel fully fledged, they are the last to reach managerial ranks in the four countries (see column e). In Germany, time scales have been partly extended by the national requirements for military conscription. The longer periods spent in completing doctoral studies or on in-company training before reaching management ranks in Japan and Germany compared to Britain and the US do not necessarily imply more inefficient education and training systems, since our inquiries leave open exactly what knowledge and skills make up the armoury of the fully fledged R&D worker. Japanese companies have tended to employ much broader definitions of organisational roles compared to British companies. However, in both Japan and Germany reforms have been directed to getting graduates to posts of responsibility at a faster pace. The concept of ‘timetable’ has a rich imagery and linkages not only to pace and direction, but junctions, destinations and travel. While looking at the past experiences gives a sense of the career structure and at what has been possible, R&D workers can develop their dreams and aspirations for preferred career routes. Tables 5.4 and 5.5 provide some insight into the remarkable congruity of actual ages and preferred ages in Britain and Japanese samples to reach the career landmarks of ‘fully fledged engineer or scientist’ and ‘project leader’. Only in the case of ‘manager’ is there some discrepancy, where the modal response in Britain suggests a desire to reach manager earlier than the typical age whereas the Japanese modal response suggests that ‘manager’ ought to be reached later than achieved by the managers in the sample. Some aspirations may be the stuff of dreams when career aspirations are contrasted with career structures, in the sense of comparing preferences against the probabilities of their achievement based on past evidence. Japanese R&D workers show a keen desire to remain in active, front-line R&D work in the future compared to their British counterparts (Table 5.6). The British R&D Table 5.4 Actual age on reaching career milestones

Key: s.d.=standard deviation Source: International Survey of R&D Workers

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Table 5.5 Ideal age to reach career milestones

Key: d.n.a. = does not apply Source: International Survey of R&D Workers

Table 5.6 Preferred future types of work by current work location

Source: International Survey of R&D Workers

workers are more likely to express a desire to be in a managerial post. These contrasts hold across current locations in both research and development departments, albeit less strongly in development departments. Yet the Japanese R&D workers are a good deal less sanguine about their prospects when asked about the likelihood of remaining an effective front-line R&D worker regardless of age (Table 5.7). Approximately half the Japanese sample see little prospect of being effective beyond the age of 40, whereas the British sample

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Table 5.7 The relation between age and effectiveness as a front-line R&D worker

Source: International Survey of R&D Workers

overwhelmingly reject the relevance of age as a constraint. Given the similarity of the sample age distributions (see the mean and standard deviations in Chapter 4), it is a striking contrast. However, it is consistent with the strong probabilities for Japanese R&D workers where long-term research is relatively recent in company histories and R&D departments have been recruiting grounds for future managers in the lifetime employment system. However, it raises the prospect of future conflict over aspirations and prospects for careers as companies have invested in central research laboratories (and it is an issue to which I return in the next chapter on the contents and discontents of R&D work). Building the R&D workforce: company policies and practices Having established the basic characteristics of two ideal types of employment system and their relevance to the samples of company R&D staff in Britain and Japan, the next main task is to examine their implications for the development of higher education and for the strategies which companies use to acquire and develop skilled R&D labour. Companies can develop the needed knowledge and skills in their workforce either internally or by relying on external sources, and they can either use the more formal methods of off-the-job training in classrooms and laboratories or the more informal methods of on-the-job training and experience (Koike 1988: 181–2). Using these two dimensions gives us the two-by-two contingency table of Figure 5.1. As we have seen in the previous section, Japanese companies put much emphasis on the first and fourth quadrants. There is little expectation that graduates come with readily applicable knowledge and skills even at doctorate level, whereas the British, German and American PhD holders and their

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Figure 5.1 The organisation of skill formation Source: Derived from Koike 1988

employers see relatively little time needed for development into ‘fully fledged’ engineers and scientists. Companies in the three Western countries expect to draw, not only on graduates with more vocationally relevant skills, but also on mid-career recruits who have gained some of their employment training and experience in other companies. For subsequent training, the Western companies can use a variety of external centres from universities to commercial training companies, while Japanese companies, when they have perceived a need for off-the-job training, have tended to develop their own facilities (quadrant 3). In Japan, the passage from university to first job is more like the managed passage of graduates between groups and institutions than in the other three countries (see Table 5.8). In science and engineering, companies contact university professors to send invitations to their prospective graduates to join them. The allocation of these invitations among students resembles a shareout of the able students among prestigious companies at the professors’ discretion. While contact through professors tends to be more important for postgraduate holders in all countries, it is clearly more important at all levels in Japan than in the other countries, and nearly three quarters of the Japanese doctorate graduates used the professor invitation channel in reaching their first job after graduation, while over half of mainstream master’s-course graduates used it. University career offices are more important in the mass higher education systems of Japan and the US compared to Britain and Germany. In Britain and Germany, the most important single channel is the direct approach by the students on their own initiative. Japanese companies are also more active in organising their alumni contacts to spread news about the company among the bachelor’s- and master’s-course students. Of course, Japanese companies vary in their markets and technologies and these are reflected in the different weights that they attach to the different recruitment channels. Since recruits have tended to stay with them since graduation, we can

D=doctorate graduates. Source: Imano 1995:19

Key: B=bachelor’s-degree graduates; M=master’s-degree graduates;

Table 5.8 Job search channels after graduation in four countries (%)

Source: International Survey of R&D Workers

Table 5.9 Job search channels after graduation in Japan (%)

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look at the Japanese respondents to gain some further insight into these variations (Table 5.9). ‘J-elec2’, which has become a very high profile company, partly by its consumer products and partly by a self-styled innovative approach to recruitment, attracts far more direct approaches from student applicants and places less weight on formal university connection through university faculty. However, it is very active in using alumni groups and careers offices. By contrast, ‘J-drink’, whose products are no doubt well-known among students, is trying to recruit for its diversification programmes in pharmaceuticals and biotechnology and trying to recruit chemistry and biology graduates with postgraduate qualifications. Therefore, ‘J-drink’ has put a great deal of effort into building contacts with university professors. With little track record in these fields, ‘J-drink’ has little scope for using alumni contacts to reach potential recruits. In some respects, the Japanese educational system delivers a more ‘standard product’ to the graduate labour market than the British system. As we saw in Chapter 2, homogeneity has been underpinned by Monbusho (the Japanese Ministry of Education, Science and Culture) through several mechanisms including Ministry control over school and university curricula, control of the secondary school syllabus through a textbook approval system, and the standardisation of routes from school to university through a joint standard achievement test as part of the entrance examination for entry to the national universities. It is a tradition of central direction which stretches back to the beginnings of the determined bid to modernise Japan from the late nineteenth century in the Meiji era, and which was dented but not broken during the democratisation of the post-1945 Occupation period (Amano 1992). In Britain there was scant provision for a national school curriculum until the 1988 Education Reform Act. As yet there is no provision for similar formal centralised control over university curricula. Monbusho issues guidelines on study credits necessary for graduation which underpins a broad common curriculum in the Japanese four-year universities. Of course the universities vary in their interpretation of these guidelines, both in their weighting and timing of professional and general studies across the four-year degree and in their syllabuses. However, the point remains that the guidelines operate to produce a more standard engineering educational experience than that obtaining in Britain. The requirements of professional institutions for course accreditation in Britain have exercised a much weaker constraint on university variety in the areas of engineering and the modes of teaching covered in the university curricula and syllabuses. A further dimension of variety in the British system lies in the routes to university since there is wider provision for transfer from a greater diversity of types of educational establishments such as schools and further education colleges, and there is relatively more provision for mature-student entry after employment experience. The British educational system has tried to provide a system of ‘ladders and bridges’ whereas the Japanese system has been accurately described as a ‘one-shot’ system, catering almost exclusively for the entry of school-leavers to higher education. However, there is another sense in which the Japanese higher educational system has provided a less standard graduate product than the British system since there has been greater variety in the equivalent of the ‘unit of resource’

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(the expenditure per student head) across national and private education, greater variety in faculty-student ratios, greater variety in the entry qualifications of entrants, and no attempt to control the quality of output by measures such as a system of external examiners on university examinations. Yet while there are marked differences between the elite national universities and the less prestigious and smaller private universities, science and engineering studies are relatively concentrated at the larger universities and the larger industrial corporations concentrate their recruitment at the larger, more prestigious universities. Moreover, although there are no standard final examinations, entry to graduate school and the master’s courses are competitive on student performance in grade-point averages. At first sight there are many similarities in the career recruitment literature of the sample companies in the two countries. However, closer examination reveals significant differences. The Japanese companies do not advertise competition on starting salaries. There is much more emphasis on the technological competence of the companies, their prospects for growth, and the prospects for long-term careers. The British companies advertised the possibilities and prospects of long-term careers too. Yet there is much more reference to ‘direct entry’ and the competitiveness of starting salaries. In that sense the graduates were recruited and assigned to specific jobs; the process of annual recruitment from higher education by companies in Britain is much more tightly geared to the identification of ‘vacancies’ than the annual recruitment process in Japan. By contrast with the British graduates, the Japanese graduates were recruited to companies which assumed long-term employment. Therefore Japanese recruits were initially assigned to broad-based training programmes to round out their organisational learning and the practical skills needed by very academically educated recruits. Knowledge and skill formation Given their commitment to long-term employment for regular employees, Japanese companies have been determined that their labour force should be able to cope with business, technological and organisational change. Japanese head-office personnel departments exert a stronger central influence over the recruitment process and Japanese line managers are more directly involved in the provision of on-the-job training than their British counterparts. Beyond induction and the phases of ‘initial training’, the methods of knowledge and skill development used by graduates in ‘mid-career training’ appear broadly similar. In both countries there is a strong reliance on self-development programmes, where new recruits are responsible for reading up documentation and technical papers. The R&D staff members rely heavily on on-the-job training under the guidance of supervisors and senior colleagues and on exposure to a variety of R&D topics which extend their experiences. However, there are some qualitative differences in the organisation of ‘on-thejob’ training in the two countries. Japanese companies have cultivated the concept

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of ‘the learning organisation’ (McCormick 1986b). Cole has demonstrated that whereas American companies tend to see learning in individual terms, Japanese companies build individual efforts into collective efforts so that knowledge and skill is more systematically acquired and diffused through the organisation (Cole 1995). While engineers and scientists in the industrial laboratories in the two countries relied a great deal on supervisors and more experienced colleagues, there is evidence that there are significant differences between the two countries in these two sources of help and guidance. Using a panel study with respondent training diaries and interviews, the LSE research team noted that their samples of British engineers in R&D laboratories tended to rely to a greater extent on more senior colleagues rather than supervisors in contrast to their Japanese respondents who relied more heavily on supervisors than senior colleagues (Lam & Thurley 1989). Moreover, the LSE researchers identified different approaches in the orientation to on-the-job learning adopted by their British and Japanese samples: the British engineers were much more closely focused on learning technical skills to solve short-term or immediate problems whereas the Japanese engineers were more likely to be learning general technical knowledge and skills related to possible projects and tasks in the longer term. Another corollary of the ‘organisation-oriented’ employment system is a different pattern and locus of in-company training compared to that adopted by companies in the ‘market-oriented’ employee system. The British sample of R&D staff was much more likely to include participation in off-the-job courses as one of their effective methods of developing knowledge and skill compared to their Japanese counterparts (Table 5.10), whether these were held inside the company (43.0 v. 18.0 percent) or outside the company (40.8 v. 6.3 percent). Although some of the British companies had invested heavily in training centres, they had not developed company technical institutes comparable to those of some of the Japanese sample companies. To some extent the greater use of in-company facilities in Japan reflects weaknesses in Japanese higher education as much as strengths in company provision since British companies have been both more willing and more able to negotiate customised courses with universities and polytechnics for their staff. In that sense, the Japanese company colleges are compensation for deficiencies in Japanese graduate education. Historically, the mission of Japanese universities has been largely to supply graduate manpower at the first-degree level rather than to function as research institutions or suppliers of postgraduate researchers. To the chagrin of many Japanese universities, large companies send their technical and managerial staff to US graduate schools rather than to domestic universities since they can buy into advanced technical and professional courses and provide international experience in one package. Within the companies, by far the most important means of knowledge and skill development are the trilogy of the work tasks themselves, the guidance of supervisors and senior colleagues and independent study (Table 5.10). Exposure to a variety of different R&D topics enables the build-up of knowledge and skills and the development of a well-rounded capability. While this means was

Source: International Survey of R&D Workers

Table 5.10 Effective methods of knowledge and skill development (%)

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prominent for the majority of R&D workers in most laboratories and countries, it was emphasised particularly by the British respondents in both research and development departments. Among the research laboratory staff in Japan, the researchers emphasise the importance of exposure to advanced topics. By contrast, advanced topics were not given prominence by British R&D workers in either research or development departments. The support and guidance of supervisors and senior colleagues was important across all departments and across both countries, but with a marked tendency to be more widely noted in the development departments compared to the research departments. In addition to the informal coaching of supervisors and the structured experience provided by work tasks, formal courses away from the job are widely valued in Britain—but not in Japan. In Britain, a variety of courses, organised outside the company and inside the company, appear to be widely valued. By contrast to the R&D workers in Britain, the Japanese engineers and scientists set little value on courses off-the-job whether organised inside or outside the companies. The relatively weak references to formal courses among the Japanese sample are not altogether surprising since an emphasis on in-house and on-the-job modes of skill formation has been a distinctive feature of the lifetime employment system. Rather more surprising is the lack of strong emphasis on rotation as part of the one of the particularly effective modes of skill formation experiences among Japanese R&D workers. Despite the oft-cited literature references to planned rotation as one of the key elements Japanese company human resource development strategies, it is no more cited by Japanese engineers and scientists than by engineers and scientists from the other countries. The most prominent citations of benefits from rotation occur not in Japanese laboratories, but in the British research laboratories. It is possible that our samples understood quite different things by rotations. On the other hand, it is possible that the commitment of central research laboratory staff to longer-term projects may mean that rotation is more difficult to organise for these samples than samples largely concerned with advanced product development. Therefore, it is less likely that these departmental samples would exhibit the usual hallmarks which have distinguished Japanese engineers from others. In their studies of Japanese and American engineers, Lynn and his colleagues noted that one difference in rotation practices was the greater likelihood of continuing rotation throughout the Japanese engineering career compared to the American engineering career (Lynn, Piehler and Zahray 1989). The researchers attributed this finding to the greater influence which American engineers enjoyed in task assignments and the likelihood that they settled into preferred niches at an earlier stage of their career than the Japanese engineer. Consistent with this notion, we found that Japanese R&D workers were more likely to anticipate the possibility of rotation in the future than the British R&D workers. Research and development are so frequently coupled together in the shorthand of ‘R&D’ that the nuances of difference between these activities and their organisation are overlooked. The passage from research to

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development can be likened to a translation process as ideas are translated into designs and eventually into artefacts. The ‘products’ of the different stages in the translation process are different. Researchers are much more likely than developers to be producing research papers, while developers are much more likely to be involved in the production of designs or artefacts. Therefore we might expect differences in the significant learning experiences of the engineers and scientists drawn from research as distinct from development departments, and our surveys confirm that researchers are much more likely to claim that their skill development has been enhanced by presenting papers to groups or conferences outside the companies. While this contrast is evident across all countries, the level of activity is much lower in Britain compared to Japan. On the other hand, the British researchers are much more likely to report benefits from formally reporting research results inside their companies than their counterparts in the research departments of other countries. Links with universities for study purposes can provide another source for skill formation among R&D staff. The research project inquired into contacts with both domestic and foreign universities. Contacts with foreign universities for study purposes are significant only for the Japanese researchers, and involving less than one in 10 researchers. Such links can be significant at the company and individual level, for Japanese companies can sponsor employees in their late twenties or thirties to gain advanced technical knowledge from the American graduate schools and to gain an international dimension for the lifetime employee and company. Study in domestic universities is little more frequently cited by Japanese R&D workers than study overseas, while Japanese and British researchers outnumber the development specialists claiming benefits from study in domestic universities. Given the importance of work tasks in shaping skill formation, it is important to examine the kinds of work experienced by the respective national samples of R&D staff. If rotation has been an important arm of the Japanese personnel strategy in shaping the skill formation of lifetime employees, then we expect Japanese R&D workers to have had a broader range of functional experiences. Yet the types of work situation experiences reported in Table 5.11 confound this impression. They suggest that rotation is less practised in Japanese R&D laboratories than is often supposed on the basis of extrapolation from studies of blue collar workers. It is much more likely that the British researchers have had experience of development work compared to the Japanese researchers. While the Japanese development workers are more likely to have experience of research than the development workers in British companies, they are less likely to have had experience of production or a range of other departments. However, this leaves open the possibility that British R&D worker experiences have been acquired in a more haphazard fashion than those of the Japanese R&D workers (Storey, Edwards and Sisson 1997:92). Although the Japanese scientists and engineers did not cite formal courses as a widespread source of skill formation, rather similar overall proportions of them appear to have been course participants compared to their counterparts

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Table 5.11 Forms of work experienced since entering the current company (%)

N= 312 138 149 156 Source: International Survey of R&D Workers

Table 5.12 Self-initiated versus directed participation in off-the-job training (%)

Source: International Survey of R&D Workers

in the other countries, although British researchers are particularly heavily engaged in course participation (Table 5.12). The most striking contrasts in course participation emerge in the reasons advanced for participation. The Japanese engineers and scientists are more likely to note that they were directed to courses by their employing companies rather than taking the initiative in course selection. By contrast, in Britain, R&D staff were more likely to claim that they took the initiative in securing course participation. The much greater sense of ‘ownership’ among the British R&D workers compared to their Japanese counterparts is consistent with general patterns of career development across samples of managers in several sectors of the two economies from engineering to banking, retail and telecommunications (Storey, Edwards and Sisson 1997). For the most part, improving technical skills is the main reason advanced for participation in off-the-job courses (Table 5.13). It is well in advance of all other purposes in all countries, except in Britain where the improvement of

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Table 5.13 Reasons given for participation in off-the-job training courses (%)

Source: International Survey of R&D Workers

Table 5.14 Reasons for the need to further develop knowledge and skills (%)

Source: International Survey of R&D Workers

managerial skills takes first place among cited reasons for course participation. Again, promotion reasons are more keenly felt in Britain. Only in Japan, among the expected long-term employees does training appear to be taken with no specific reason in mind save potential relevance. Behind the strong emphasis on technical courses, scientists and engineers in R&D have a strong sense of the pace of technological change, the move into more advanced work and the need for updating (Table 5.14). Reforming education and training: industrial perspectives The contrasting patterns of current educational and training provision and the differing career aspirations outlined in the two previous sections are important factors shaping employee perceptions of the areas of needed improvement in university and company education and training. In both countries there are striking parallels between the patterns of survey response and the main national debates on education and training.

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During the 1980s in both Britain and Japan, there have been debates and proposals for reforms designed to gear higher education more closely to anticipated industrial need. The national contexts have been rather different, the earlier decades of the 1960s and 1970s providing a background of disappointment about manufacturing performance in Britain, with Japan enjoying outstanding high growth up to 1973 and even recovering from the ‘oil shock’ of 1974 in very creditable fashion by international comparisons. Japanese unease and interest in reform stemmed from changing perceptions of the Japanese economy and some doubts about whether the institutional arrangements which had underpinned past economic growth could sustain future economic needs; in essence, Japan was widely perceived to be abandoning its past strategy of ‘catching up on the West’ and poised to become a leader rather than a follower in many technological fields. The new role has been thought to imply a need for a strengthening of the supply of scientific and technological labour related to more innovative R&D (Dore 1986). In Britain, reform debates have tended to assume no lack of creative talent. Rather, the problem has been perceived to be a weakness in harnessing innovative R&D effectively to manufacturing effort. Chapter 2 noted one of the more comprehensive reviews and sets of reform proposals undertaken by the Finniston Committee, with a remit for engineers in manufacturing industry (Finniston 1980). The Committee argued the case for a broader-based British engineer in terms of education, training and role conception, someone capable of making the crossfunctional links necessary to promote and co-ordinate industry’s innovative effort. In looking at the balance in the division of labour between education and industry in the education and training of engineers, it proposed that higher education should undertake to provide a greater proportion of the ‘general skills’ training, so that industry would be prepared to invest in ‘specific skills’ training. In other words, the Finniston Committee acknowledged the inhibition to investment in training generated by well-developed external labour markets and urged that the educational system should be made to undertake a larger share of the investment in vocational education and training. During the 1980s, many universities and polytechnics were developing programmes of study incorporating elements of ‘engineering applications’ in the areas of fabrication and industrial organisation laid down by the Finniston Committee. Thus although debates about future industrial needs have inspired controversy in Britain and Japan, these similar notions have had quite different implications for curriculum reform. The British reform process has concentrated on making graduate engineers more readily employable on graduation, more immediately useful and knowledgeable, in the hope that if the state funded general training then employers would be stimulated to invest in specific training. The Japanese pattern of higher education, which looked very academic at the outset, appears to have been confirmed in its academic preoccupation. Given the ‘organisation-oriented’ employment system, there has been little fear about any possible decline in employer readiness to invest in relevant company training. Reform proposals for higher education in science and engineering have concentrated on efforts to support the promotion of longer-term basic research in industrial laboratories through increasing

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the proportions studying science relative to engineering, promoting creativity through efforts to reduce the dominance of the university entrance exams and through efforts to encourage more diverse types of university and greater variety in curricula. The echoes of these national debates can be seen in the views of our samples of industrial R&D staff, for there are very striking differences in the R&D respondents’ views of university curricula (Table 5.15). The British sample wished to see improved provision for the development of ‘practical skills’ (59.2 percent). This goal found much lower resonance among the Japanese respondents (32.1 percent) (see Table 5.9). Second priority among the British R&D staff was a need for improved teaching of ‘business and administrative skills’ (39.6 percent) which had minimal support for reform in the Japanese system (2.0 percent). By contrast, the Japanese sample emphasised the need for improved provision in ‘basic science’ and ‘engineering principles’ in university curricula. In essence, the British sample called for a more direct vocationalism in university curricula, while the Japanese sample concentrated on the more general and academic aspects of the curriculum as areas for future reform. This Japanese view is not devoid of a vocational element, since it is likely to reflect national debates about the need for greater creativity and criticism of the influence of dull, rote learning in the examination-dominated school system. However, in discussions of the balance of vocational and academic content the Japanese samples reform suggestions appear more readily consistent with academic aims and purposes.

Table 5.15 Areas needing curriculum reform in university and company education (%)

Source: International Survey of R&D Workers

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Discussion To summarise the findings so far, we can see that compared to their Japanese counterparts the British R&D staff have been: • largely the products of a shorter education—the typical British R&D staff member leaves university after the three-year bachelor’s degree and enters employment at 21 or 22 (although Britain has a higher proportion of doctorate holders), whereas the Japanese counterpart leaves university after the two-year master’s course and enters employment at 24; • the products of a narrower and more technical curriculum since the Monbusho curriculum credit guidelines have prescribed the continuation of breadth and general education, not only in secondary education but in higher education too (although in Chapter 2 we noted that this may change following the 1994 education reforms in Japan); • largely seeing themselves as competent, well-rounded researchers (‘fully fledged’) at a much younger age (23.6) compared to their Japanese counterparts (28.7); • much more likely to see needed educational reforms in terms of needs for ‘practical skills’ and ‘business and administrative skills’ than their Japanese counterparts (who emphasised ‘basic science’ and ‘engineering principles’); • more likely to see their career development in terms of moves into managerial posts than their Japanese counterparts; and • more mobile than their Japanese counterparts—in the sense that a higher proportion have changed employer since graduation and that a somewhat higher proportion preferred further change. The links between these points can be taken in reverse order in order to build an explanation of the impact of the two different employment systems on higher provision and graduate perceptions of it. Although the majority of this British sample remained with their first employer from graduation and although the majority of this sample anticipated staying with their current employer, there has been significantly more mobility among the British sample than among their Japanese counterparts. Moreover, beyond the large British companies sampled in this study there was likely to be even more mobility (Connor 1988: 63). The significance of external labour markets was reflected in the way in which British graduates tended to claim that they take the initiative as individuals on a range of decisions from their search for initial employment to their requests for training. The perception of available career routes and rewards which was evident in the British responses indicated the desirability of moves out of wholly technical roles into managerial roles. The pattern and the timing of career moves were directly related to the perceptions of needed educational reform. The ultimate goal was not only to arrive in managerial posts but to do so on a time scale which was far more rapid than any envisaged by the Japanese sample. The career milestones which marked out a

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shorter degree course, a speedier path to the status of a ‘fully fledged’ R&D worker, and earlier arrival at posts of managerial responsibility implied that the educational provision must be both narrower and more vocational in orientation and in content. It was these perceptions of the structure of career opportunities and rewards which shaped respondent perceptions of desirable educational reform. In sum, ‘shorttermism’ abounded in the career thinking of British R&D staff and it was this kind of thinking which has been underlying many of the recommendations for improvement in British higher education voiced by industrialists. ‘Short-termism’ has been used to characterise British industry in several other respects, notably in debates about the time horizons for investment planning and payback horizons. While there is little doubt that British industry might be described as ‘short term’ in these respects, there is a great of controversy over the origins and implications of such thinking. While some relate short-term perspectives to the financial structures of British companies and the conduct of the banks and the ‘City of London’ financial institutions (Williams 1991; Eltis, Fraser & Ricketts 1992:13–14), others contend that the perspectives are internally generated within industry itself rather than externally imposed (McKinsey 1988; Ball 1991). However, the more immediate issue for this chapter is to trace the link between the relative ‘short-termism’ of R&D staff in their career and educational thinking and the alleged ‘short-termism’ of industrial investment. Perceptions of companies’ central problems and company reward systems provide the links between the two dimensions of short-term thinking, since the reward systems reward and guide employees towards tackling and resolving significant problems. The central importance of capital markets and the differences in their structures in the two countries have meant that British managers have been encouraged to watch much more closely their share prices and earnings in the short term in order to avoid predatory takeovers than Japanese managers. This important constraint on senior managers has a cascade effect on the nature of tasks, reporting periods and the structure of rewards through the British companies. Since the completion of the fieldwork, the British companies have had several examples of restructuring: ‘B-elec’ fought off a hostile takeover attempt and restructured the company; ‘B-chem1’ became the subject of much speculation about a divestment; ‘B-chem2’ was divested by the parent company and sold to a foreign-based multinational company; and ‘B-fibre’, after many years of growth through merger and acquisition, was restructured into two companies. This British pattern of buying and selling companies has been more difficult in Japan because of the Japanese pattern of cross-company shareholding among bankers, insurers, suppliers, distributors, and so on. Insulation from takeover has been further aided by greater reliance on debt compared to equity for company finance and the long-term relationship with banks. Among the Japanese sample companies, only ‘J-chem’ has been involved in significant restructuring through a merger with another company in its keiretsu group. The traditional pattern of growth in the Japanese companies has been through organic growth rather than acquisition; it has been a pattern in which market share has been the index of company performance and product innovation based on R&D has been the route to achieve

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it. Staff compensation schemes in Japan still have uniformity across the functional areas within companies and still carry a significant seniority element to encourage long-term career commitment. In Britain, promotion and salaries are widely perceived to reward moves out of wholly technical fields towards taking managerial responsibilities and to be weighted towards rewarding contributions which deal with price/earnings ratios in the short rather than the long term. One large sample survey of recently graduated engineers found that although 70 percent of respondents intended to enter industry, only 35 percent intended to pursue careers as professional engineers, and that the factors impeding the choice of engineering careers were largely based on direct observation and experience of industry including disenchantment with assignments and rewards (Industry Ventures 1989). In recent years, some Japanese industrialists have expressed concern at the small but increasing proportion of the more able bachelor-level engineering graduates who were seeking and finding employment in the financial services rather than the manufacturing sector (Muta 1990b). Industrialists voiced fears about the possible extrapolation of these trends, of the ‘leakage’ of talent from their pool of potential recruits and the possible damage to Japanese manufacturing industry. However, since 1990, the Japanese stock market crash, the trail of financial scandals involving major Japanese financial institutions, and the smoothing of the ripples from financial deregulation have moderated the trend towards the financial services sector employment of able graduate engineers from the prestigious universities. No country will be without social critiques of its higher education-industry relations, although Japan’s debates have been much more muted than those in Britain and, until recently, signalled unease about an uncertain future rather than gloom about relative economic performance. Given this background, it has been tempting for British observers to concentrate on the successes of other national higher-education systems, particularly where there is the added temptation to indulge in some relatively simplistic ‘cause and effect’ reasoning to link education and economic success and to provide a scapegoat in one’s own national education system for economic failures. Closer examination reveals that other systems have their own problems and weaknesses too. Many of the past comparisons rest on comparing statistical aggregates which simply assumed that like was being compared with like. The purpose of this chapter has been to scrutinise some of the terms more closely, particularly by looking at samples of graduate scientists and engineers working in industrial R&D in order to show how the nature of employment and careers, the sequences of tasks performed and progression through them, shape perceptions of desirable educational reform. It is evident that the term ‘university’ has been applied to a wider variety of institutions in Japan and it is clear that the term ‘manager’ has a looser usage in Britain. The British R&D laboratories appear to have been able to build their labour forces with a spectrum of educational qualifications from doctorates to bachelor’s degrees and they have been able to move their staff into responsible posts at relatively youthful ages. The companies have been able to recruit very high doctorate-level R&D staff who have had a large element of research training in university laboratories. However, this British pattern appears to have

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carried two kinds of cost: first, there has been a high degree of specialisation in education courses and work tasks; second, there are debates about the mis-match between graduates specialisms and task requirements evident in comments about ‘too many chiefs and not enough indians’ (that is, many over-qualified senior staff overseeing activities and too few staff with intermediate qualifications to execute tasks); third, the extent of the specialisms and the inflexibility mean that there are high costs in converting people and tasks to mitigate the problems. It is further apparent from this closer examination of British and Japanese companies and their R&D staffs that the greater variety of British employment practices among large companies makes for a more perplexing set of signals to the British higher-education system, ranging from those which reflect the pressures to equip graduates for their first job, or those which want the strengthening of business studies in science and engineering degrees, to those which want a more general education as a basis for a longer-term career. On balance the shorter-term pressures appear to have had a major influence in recent debates on higher education and appear to reflect the career pre-occupations of employees. Present attempts to move towards a mass higher-education system and to provide a broader-based curriculum appear to add to the dilemmas of the educational system because they attempt to make the adjustments within traditional time scales of undergraduate and postgraduate study. International comparisons help throw into sharper relief what is often taken for granted within national debates; in so doing the research might generate as many questions as answers. Looking at the career paths experienced and preferred in the two country samples, it does seem puzzling that so much British effort is put into channelling people into relatively narrow specialist education in order to enter relatively specific occupational roles as technical specialists from which they seek a relatively early escape. The contrasts raise two further questions: firstly, do British companies need as much specialist science and engineering as they get from the graduates that they recruit; and secondly, do British companies get sufficient science and engineering from these R&D recruits over their company careers?

6 Research and development work Its contents and discontents

Introduction What do engineers and scientists working in industrial R&D want from their work? What do they find in it? Is there any mismatch between aspirations and achievements? Are there invariant universals in the hopes and joys of R&D workers or are there important national variations? Equally, is there manifold variety in the organisational arrangements regulating R&D work or do the demands of effective and efficient performance set severe constraints? The reference to ‘contents’ in this chapter heading is deliberately ambiguous and intended to herald our attention to both the ‘constituent parts that make up the detail of R&D work’ and to the ‘satisfactions’ (and dissatisfactions) which can be found in such work. In this chapter, my interest lies in the potential for conflict between engineering and scientific professionals and their large corporate employers as generic features of industrial capitalism. However, capitalist industrialism has had different starting points and trajectories in Japan and Britain, therefore I will point up the rather different ways in which such conflicts are patterned and handled in the respective institutional structures of Japanese and British industry. Following a closer look at the literature on professional scientists and engineers in industry, my next step will be an examination of the work goals of the R&D staff sampled in the International Survey of R&D Workers. In both countries, R&D staff emerge as keenly committed to the development of their knowledge and skills and to opportunities to use them, yet concern about autonomy was most acutely felt by the Japanese R&D staff. By this reckoning, Japanese engineers might appear more committed to professional values than their British counterparts. However, these responses must be put in the context of a world where the Japanese R&D employees’ waking hours are very deeply wrapped up in work-related activities. Having looked at the time inputs of R&D staff to their work, I shall examine the way in which R&D projects are managed. The nature of the rewards for R&D staff will be examined in two sections: first, dealing with issues of pay and promotion, and second, dealing with factors generating satisfaction and dissatisfaction. Finally, I shall turn to the issue of collective voice and the extent to which engineers and scientists in

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Japanese and British industry can improve their lot through membership of collective organisations such as professional institutions or labour unions. Engineers and scientists as professionals in industry For many years after Edison’s invention of the industrial laboratory, many of the early American industrial R&D laboratories followed his pattern of surrounding an able director with talented and like-minded people. As Funk observed, organisation and management in such laboratories rested largely on the dynamism and co-ordination of their director, and the total employment of 33,000 engineers and scientists across America’s 1,600 industrial laboratories implied an average labour force of only 20 staff per laboratory in the 1930s (Funk 1992:82–3). However, problems associated with professionalism and larger-scale administration began to attract attention after 1945. R&D work had twin boosts from the two worlds wars in this century. While the First World War has sometimes been termed ‘the chemists’ war’, the Second World War was undoubtedly the ‘physicists’ war’. Both wars demonstrated the awesome power of science when used to fashion destructive technologies in modern warfare. Attempts to harness some of the new knowledge and skill to more constructive peacetime activities ushered into existence whole new industries in the post-war era. While the atomic bomb and radar were readily associated with the nuclear and electronics industries and continued to be important in large defence industries, particularly as the Cold War took shape in the late 1940s and early 1950s, there was a wider search for applications from the host of scientific discoveries and technological inventions bred in the hot-house of war. As increasing numbers of scientists and engineers were recruited into the laboratories of large corporations, social scientists began to examine the terms and conditions on which this new kind of scientific and engineering labour was being employed. It was not surprising that many of the pioneering studies were initiated in the US, the new superpower with great investments in military, economic and political leadership, whose industrial corporations led the way in enlisting huge numbers of scientists and engineers for its industrial R&D laboratories in the 1950s and 1960s. Two factors encouraged a focus on the potential for mismatches on values, work goals, work organisation and rewards between engineers and scientists as professional employees and their corporate employers. On the one hand, the main theoretical framework influential in the nascent field of the sociology of science and technology derived from ‘structural functionalism’, a perspective which focused on the normative structure of social institutions as the key to the structured social relations and social institutions needed to carry out society’s functions. It generated an interest in the propensity for scientists and engineers to emerge from universities imbued with the values and norms of academic science and to chafe against the constraints imposed by managerial controls in public and private sector bureaucracies. Robert Merton’s studies of the seventeenth-century revolutionary and heroic age of science were often taken

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as a source for the academic values of science, with engineers pictured in some half-way house between academe and business. On the other hand, much of the literature on professions held out models of the liberal professions, such as the medical doctor or the lawyer working largely in independent practice. Again there were images of the potential for irritation over the issues of power and control, career ladders, and rewards. Neither tradition envisaged open and unmitigated warfare between the professional engineers and scientists and their employers; both suggested scope for conflict and adaptation, as William Kornhauser indicated in the subtitle of his study of scientists in American industry (Kornhauser 1963). Indeed much of the prescriptive literature was aimed at accommodation and conflict resolution with designs for new social institutions, particularly new organisational forms to reconcile the need for working conditions, career structures and rewards which both fostered creativity among scientists and engineers and yet respected the managerial need for control. Despite different origins and different research strategies, three studies formed something of an ‘orthodoxy’ with accounts of engineers and scientists as professionals in American industry (Kornhauser 1963; Marcson 1960; Strauss and Rainwater 1963). On the one hand, they saw a normative order as functionally necessary to ensure the integrity of contributions to science, but, on the other hand, they charged that such an order was continually challenged by employers driven by the criteria for business success in their enterprise. While each of the authors put the term ‘scientist’ in the title, they included ‘engineers’ in their samples and justified their inclusion on the grounds that they claimed to be ‘professionals’ and shared much in common in terms of aspirations and experiences with the ‘scientists’. Marcson, based in an industrial relations department, closely observed a Pacific Coast electronics laboratory and came to the pessimistic conclusion that any adjustments in values largely reflected concessions by the scientists and engineers. Strauss and Rainwater, commissioned by the American Chemical Society to survey members, drew on questionnaires from seven categories of ‘member’ from academic chemist to industrial chemical engineer. Kornhauser submerged the details of his empirical studies in government, industrial and academic laboratories, but produced a synthesis portraying the importance of structures to ensure expertise, autonomy, commitment and responsibility to safeguard standards of excellence in scientific performance ‘against pressures for quick and easy solutions’ (Kornhauser 1963: 1). Citing from both studies that did, and those that did not, distinguish scientists from engineers, he concluded that differences were of degree only, rather than those of kind. He concluded on an optimistic note that recognition of mutual dependence on the part of both scientists (and engineers) and industrial employers would prompt efforts to devise new hybrid structures to secure the effective scientific contributions necessary for organisational goals and yet grant the autonomy necessary for creative scientists. Some examples lay in new definitions of ‘professional goals’ to broaden the scope of professional activity, new ‘professional controls’ to accommodate professional and organisational

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controls, new ‘professional careers’ such as ‘dual career ladders’ to permit promotion for both the ‘technically’ and the ‘managerially’ oriented scientists or engineers and a broadening of professional responsibilities. Against this orthodoxy, some pointed up the great variety of educational backgrounds, occupational locations and the limited nature of value clashes. Kaplan doubted the usefulness of a ‘profession of science’, questioned the validity that all scientists want to work in basic research, queried the simplistic assumption of links between autonomy and creativity, and pointed to the lack of specification of levels of supervision in the discussion of hierarchical and collegial control (Kaplan 1964, 1965). For Kaplan, it seemed that employers, swallowing the ‘orthodox view’, might conduct an unnecessary double brainwashing exercise on their scientists and engineers, attracting them with promises of basic research which they did not necessarily want, and then launching induction and counselling programmes to persuade them into the attractions of applied research and development. As the employment of scientists and engineers in large bureaucratic organisations grew in Britain, the issues of new forms of employment were explored from a variety of standpoints. C.P.Snow’s novels portrayed the ‘new men’ and contrasted the different outlooks of scientists and engineers with those of administrators in government service and drew from his experience as a scientist and civil service commissioner (Snow 1954). Snow’s term, the ‘two cultures’, contrasting ‘science’ and ‘arts’, animated much popular debate on education, politics and culture (Snow 1959). A journalist, Anthony Sampson, located scientists, engineers, administrators and industrialists and their conflicts in an ‘anatomy of Britain’ which became a widely read guide to Britain’s efforts to come to terms with the post-war world (Sampson 1961). Meanwhile, British social scientists often borrowed from the conceptual toolkit of the American sociologists to explore value conflicts between scientists and industry. Cotgrove and Box (1970:26) set out to test the relevance of the Mertonian norms of science, particularly ‘autonomy’ and ‘communality’ (which implied a commitment to publication), and commitment to a scientific career through two studies. First, a questionnaire to final-year chemistry students identified ‘public scientists’ (to whom all three aspects of autonomy, publication and scientific career were important), ‘private scientists’ (to whom autonomy and scientific careers were important, but not publication) and ‘instrumental scientists’ (for whom scientific skills might be used for career advancement, but who would be ready to abandon a scientific career). A second parallel study of company recruitment and industrial scientists suggested that through a combination of student choice and company selection most of the ‘public scientists’ would go to public-sector employment (universities or government laboratories) and companies would recruit their immediate scientific needs and the future managers among the ‘private scientists’ and ‘instrumental scientists’. In other words, the frustrated ‘public scientist’ in industry was a recruitment/ selection ‘mistake’. Barnes added to the doubts about the depth of commitment to scientific values among final-year students through a panel study of final

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year students which demonstrated the readiness of graduates to adjust their orientations to the perceived needs of their situation on entry to industrial employment (Barnes 1971). Methodologically, Barnes’ use of an interactionist framework cast doubt on the value of the structural-functionalist approach. 1 Ellis (1969a, 1969b) initially followed the Box and Cotgrove framework in his study of industrial scientists, but was influenced by the Kaplan critiques of the structural-functionalist approach in America and Britain. He rejected the image of science as ‘a socially integrated occupation’ in favour of ‘an amalgam of many diverse elements’ (Ellis 1969a, 1969b). His image of the industrial scientist became that of the ‘scientific worker’, often becoming someone who had been lured into pure science in the educational system and thrust into the role of ‘frustrated technologist’ aspiring to management, acutely aware that engineers might have more readily relevant skills and better promotion prospects. Prandy set out much more explicitly with an interest in stratification to look directly at the position of the engineer and scientist in the authority and prestige structure of British industry (Prandy 1965). Working within a framework which owed much to Weberian rather than Marxian discussions of social stratification, his interest was in how engineers’ or scientists’ positions in the social structure of the industrial enterprise affected their ideology. For example, how did age, education or employment conditions affect espousal of a ‘class’ ideology (emphasising conflictual elements in their employment relations) or a ‘status’ ideology (emphasising harmonious aspects of the relations and acceptance of the authority structures). Postal surveys and interviews with members of a professional institution (the Institution of Metallurgists), a trade union (the Association of Scientific Workers) and a professional union (the Engineers’ Guild) confirmed his main hypothesis that where engineers and scientists shared directly in the exercise of authority, or where their work gave them a feeling of being close to management, they saw themselves as part of a graded hierarchy, espousing a status ideology, which tended to find concrete expression in membership of professional institutions. By contrast, those engineers and scientists who experienced work conditions which emphasised their subordination tended to hold an ideology closer to the class type, recognising conflicts of interest with their employer, and tended to be trade union members. Linking positions and ideologies, Prandy found that the status (or harmonious) ideology tended to be related to administrative functions, private industry, fulltime university education, and older respondents. By comparison, the class (or conflictual) ideology tended to be found among those in technical functions (particularly routine production rather than R&D), the public or government sector, part-time technical college education, and younger respondents. However, Prandy cautioned that, even where dissatisfactions were expressed, action along class lines among the young engineers and scientists was at best only half-hearted since these employees were very conscious that they could aspire to escape by individual career advancement rather than collective advance. By and large, collective efforts tended to be seen in terms of public-

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relations campaigns to convince management, government and the general public of the need for proper recognition and rewards for the special talents and vital work of engineers and scientists. In other words, engineers and scientists tended to argue for greater social differentiation and a special position in industry rather than press for class action and throw in their lot with labour in a struggle with capital. The revival of interest in Marxist scholarship in Western Europe stimulated two studies of the social position of engineers in British industry. Whereas most of the studies discussed so far put their emphasis on industrial society, these studies emphasised the capitalist setting for engineering work. Smith rejected the Weberian approach because it tended to ‘fragment class relations into an infinite variety of market properties, without capturing the contradictory movement of class consciousness and conflict within capitalist societies’ (Smith 1987:298). Starting from the ‘new working class’ theses of French neo-Marxist writers, he attempted to avoid their technological determinism by setting the central class relations in their particular historical social formation in Britain. Linking the conceptual discussion to empirical study through trade-union access to a group of workers in a number of technical occupations in British aerospace, Smith argued that there was a close association between technical and manual workers. This association had emerged through continuities in craft traditions in training and socialisation, although Smith concedes that it is being challenged at design engineer level through technological change and through the recruitment of university graduates which might generate a new barrier between technical workers and other members of the working class. By contrast, Whalley (a member of the Columbia research team discussed in Chapter 4) rejected the French neo-Marxist ‘new working class’ theses as overlong on logic and short on empirical study. Through interview investigations in two engineering plants, a traditional mechanical engineering plant and more high technology computer, Whalley conceptualised engineers as ‘trusted employees’ recruited, trained and rewarded to undertake the discretionary tasks delegated by employers in the complex industrial organisations of advanced capitalism (Whalley 1986:59). Locating these ‘trusted workers’ within the broader ‘service class’ enabled Whalley to link the micro-level of detailed plant studies to the more macro-level of occupational political and national variations in the organisation of work and occupations. Although the discussion of ‘trust’ and ‘discretion’ marked interesting conceptual innovation, there were echoes of earlier discussions. While the employers’ problem might be seen as the need to extract ‘surplus value’ discreetly, the engineers’ problem is how to maximise the area of discretion (Whalley 1986:196). This links back to those issues raised by Kaplan, namely that engineers and scientists in industry might ‘use the values of science and the desire for autonomy in order to increase their power within the organisation and not at all to become better basic scientists’ (Kaplan 1965:97). As Prandy demonstrated, ideologies of professionalism were more likely to be canvassed by engineers and scientists in R&D than in other functional areas of industry (Prandy 1965). Moreover, Burns confirmed that

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they might do so with some success in his classic pioneering text on engineers and scientists and the management of innovation: first, industrial scientists and engineers in R&D do make claims for a special status in industry; second, their familiarity with other settings in which scientific and engineering skills are employed gives scientists and engineers different perspectives and bargaining positions vis-à-vis their employers compared to other industrial employees; third, explanations of the relations between engineers and scientists and their employers in British industry must be set in the broader historical and cultural context of British industrial development (Burns and Stalker 1966:175). Far from sealing R&D workers away either linguistically or socially, for much of the post-war period Japanese employers have emphasised their common lot with other employees. Claims by or on behalf of R&D workers for special status are relatively recent in Japan and reflect the novelty of the 1980s wave of longer-term industrial R&D facilities. The modern university system which was fashioned in the Meiji period was initiated as an arm of the state to develop the cadre of engineers who could handle imported technology and the administrators who could administer the modernising state. The Japanese state controlled both the supply and the demand for their services. There was a premium on understanding and applying Western science and technology in the service of the state. This was not a disinterested state supporting the generation of knowledge for its own sake. The historical legacy of simultaneously importing science and technology for state purposes has had important ramifications for contemporary discussions of ‘science’, ‘technology’ and R&D in Japan and is reflected in linguistic differences in their treatment in English and Japanese, as Methe notes: …what in the West would be distinguished as scientific knowledge, as opposed to technological knowledge, was to the Japanese simply that knowledge needed to solve problems. The clear distinction between science and technology thus became blurred. As a result, the Japanese term kagaku-gijutsu appears as often as do kagaku and gijutsu in discussions of science and technology. Kagaku-gijutsu often is translated into English as ‘science and technology’ with the ‘and’ made explicit in English but absent in Japanese. (Methe 1995:21) The Imperial universities had a central preoccupation with the introduction of imported technology and the generation of Japanese technology was often undertaken in research institutes attached to universities. Private-sector R&D began to appear in the late Meiji period. The R&D laboratory of Mitsubishi Nagasaki shipyard had been started as a small chemical analysis laboratory in the foundry but, after expansion in 1916, influenced by impressions of the Krupps laboratory in Germany, its 12 engineers played an important role in facilitating the adoption and adaptation of imported technology (Fukusaku 1986:

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82). R&D reports suggest that the activity through the 1920s and 1930s was mainly related to manufacturing rather than independent research (Fukusaku 1986:84). The pre-war Japanese factory had many of the characteristics of a Western factory and there was a sharp demarcation in conditions and terms of employment between blue- and white-collar staff. Amid the post-war occupation reform period, Japanese labour unions pressed for the closing of that gap. The Association of Japanese Scientists (Minkan), a body linked to the Japan Communist Party, was active in pressing for the greater democratisation of hierarchical administration in laboratories and had some influence on personnel policies in established company laboratories, such as those at Toshiba (Nakayama 1991). An important theme in early post-war debates was the extent to which Japan should rely on imported technology or try to develop indigenous technology. Some companies had a strong reputation for fostering home-grown technology and Hitachi laboratories were highly regarded as favourable employment by those seeking scope for the more independent R&D (Nakayama 1991). Other post-war companies were concerned with the need to create organisations which attracted, retained and promoted creative talent. Although adopting the broad parameters of the lifetime employment system as it developed in post-war Japan, the Sony Corporation promoted itself as one of the new breed of postwar corporations in Japan, self-consciously concerned to be marked out as an innovative high technology company and sensitive to the need for organisational forms and personnel policies suited to the management of creative professionals. By the 1960s, the more technocratic opinion held greater sway among Japanese engineers and scientists. While there was a wave of R&D building in the 1960s, much of it was still concerned with adapting imported technology and the scale of R&D employment was still relatively small. It was the 1980s’ wave of building central laboratory facilities for longerterm R&D which prompted surveys of R&D workers and debate about the need for new patterns of human resource management (JPC 1987, 1988; Yamada 1991; Wakasugi 1992). The relative strength of alternative pulls on organisational design for industrial R&D have been usefully mapped by Westney (Westney 1993a:45– 9). On the one hand, companies have faced a strong set of interrelated pressures to match human resource management policies and practices in R&D functions closely to those in other functions in their organisations. Many of the pressures stem from the institutionalisation of a range of policies and practices in career and reward structures. Career structures rest on the recruitment of generalists to follow standard career paths, and transferring R&D specialists eventually into line or staff positions in operating divisions. Reward structures are standardised across functions and their use is buttressed by conventions to limit discriminatory rewards for ‘high flyers’ or to differentiate in favour of particular functions. Although the standard image of Japanese R&D staff held in the US is that of ‘company men’ locked into internal communication networks and relatively sealed off from external networks, Westney points to efforts by

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electronics and information technology companies to foster ‘organisational professionals’ whose external reputations enrich company standing. Thus Japanese electronics workers have been found to be more likely to participate in professional societies, more likely to attend professional meetings, and more likely to believe that their employers supported publication than their American counterparts (Westney 1993a:48). On the other hand, Japanese companies have not been strongly pulled towards the design of organisations to accommodate ‘academic professionals’ in the sense that American or British companies did from the 1950s and 1960s. Japanese universities have not provided many PhDlevel researchers for industry. Japanese universities have not provided a strong alternative model of the professional researcher since they have not been prominent in the national research system. They have tended to be valued for their contributions of manpower and for their contributions to improving science through a focus on external information gathering and dissemination rather than to fundamental breakthroughs in scientific knowledge. Thus the definitions of scientific ‘professionalism’ with which Japanese scientists and engineers enter industry are less likely to serve to differentiate them from other organisational members and less likely to provide points of conflict with their employers compared to those available to their American counterparts. This debate, and the impression that Japanese corporations might learn from the experience of Western corporations’ involvement in R&D, lay behind the interest of Japanese social scientists and companies in the International Survey of R&D Workers from which we can gain further insight into the aspirations and experiences of R&D workers in the next section. The paradoxical professionalism of Japan’s R&D workers Given our account of the development of corporate R&D in Japan and the Western industrial countries and the models of professionalism available to corporate R&D workers, the International R&D Worker Surveys across four countries suggest a surprisingly more intensive and more pervasive level of professionalism among Japanese R&D workers than their Western counterparts by attitudinal and behavioural measures on each of the standard dimensions of specialist knowledge, autonomy, career commitment, reward, professional organisation membership and publication. Specialist knowledge While R&D workers in all four countries attached a high importance to developing their specialist knowledge and skills, the Japanese R&D workers attached much more importance to increasing their knowledge development than the R&D workers in either the British, German or US samples (see Table 6.1).

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Table 6.1 Personal goals of R&D workers in four countries

1 One answer only. 2 1=very important; 2=important; 3=not so important; 4=unimportant. 3 Multiple answers possible. Source: Ernst 1995 (based on respondents to the International Survey of R&D Workers from the electrical and electronics sectors only)

Autonomy Again, while all R&D workers attached importance to freedom in the conduct of their work, the Japanese R&D workers attached much more importance to increasing their freedom in R&D work than those in the other three countries (Table 6.1). The sharp contrast between the Japanese emphasis on freedom in research and the lower priority in Britain was still confirmed when Japanese and British R&D workers were compared, controlling for their location in either research or development (Table 6.4). Career commitment The desire to continue in front-line technical work was much more widely held among the Japanese R&D workers than among the R&D workers in the other three countries (Tables 6.1 and 6.3). Professional rewards Looking at preferred rewards in the future, the Japanese R&D workers attached much more importance to increased autonomy in their R&D work than the R&D

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workers in either the British, German or US samples and attached least importance to promotion (Tables 6.1 and 6.3). Professional organisations The Japanese R&D workers were the least likely to remain outside some organised group related to their technical speciality. While this might fit popular stereotypes of the group-oriented Japanese, the more surprising point was that they were much more likely than their Western counterparts to join an extra-company professional association (Table 6.2). Moreover, they were much more likely to see the benefit of their membership in opportunities to present their research work outside their company (Table 6.2). However, greater importance was attached to maintaining contacts with professionals outside the company by the both Japanese ‘Research’ and ‘Development’ workers compared to the British respondents (Table 6.4). Publication The relatively high propensity for external communication evident in professional association membership was further confirmed by the higher level of publication when Japanese and British samples are compared on the importance attached to presentations and publications while controlling for functional location (line 11 in Table 6.4). Not only was a higher aspiration expressed in the attitude survey, but it was matched by consistent behaviour as more of the Japanese R&D workers reported published papers (see Chapter 4) and this difference was consistent across the companies (Tables 4.9 and 4.10).

Table 6.2 R&D workers’ membership in professional organisations in four countries (%)

Source: Ernst 1995 (based on respondents to the International Survey of R&D Workers from the electrical and electronics sectors only)

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R&D inputs: working hours The life of a Japanese R&D worker has been much more intimately wrapped up in the world of the company than that of the British R&D worker. Put in more quantitative terms, Japanese engineers and scientists in industrial R&D typically worked over a day a week longer than the comparable employee in a British corporate laboratory—for example, Japanese respondents averaged 53.12 hours per week compared to only 41.37 hours among the British respondents. In practice, the hours worked in Japan were spread unevenly with the longest working week being put into the development laboratories compared to the research laboratories. In Britain, there was little difference between research and development laboratory settings. Among British R&D staff, the main noticeable variations could be found between managers and rank-and-file R&D staff, with the managers working longer hours. The context of the ‘bubble economy’ in the late 1980s and the associated labour shortages exacerbated the problems of working hours, particularly for R&D workers in the development departments. One third of the additional comments freely volunteered by Japanese R&D staff were concerned with ‘working hours’, whether as complaints that long working hours weakened staff freshness and creativity or suggestions that more discretion ought to be granted in flexi-time. I have to do overtime work for one or two hours every day, although we cannot get enough pay. I hope for the management of working time (36). Overtime work is considered as natural, and business results are evaluated by the hours of overtime work. They always have tendency to take the overtime work of different departments, but that is not what we are looking for (184). Researchers need flex-time to work more efficiently (486). We need the shortening of working time to the 5 day week, flex-time and the system of long vacations (522). Greater discretion over research time features in many of the debates on reforms needed in Japanese corporate R&D. It has often been discussed as ‘free time’ or time for ‘under-the-counter’ R&D work. The argument runs that more scope in time and resources for independent curiosity-oriented research will be necessary if Japanese laboratories are to secure the more radical innovations needed in a society which is at the research frontier and no longer content to rely on just improving imported technology. The case for ‘free time’ has been put not only in terms of the need for individual space for fresh and creative thinking, but it has been seen as a powerful incentive and reward which R&D management could offer to induce and reward good performance. ‘Free time’

Source: International Research Survey of R&D Workers

Table 6.3 Importance attached to work goals by R&D workers in Britain and Japan (%)

Source: International Research Survey of R&D Workers

1 Respondents marked goals on a four point scale from ‘very important’ (1) to ‘very unimportant’ (4).

Table 6.4 Importance attached to work goals by ‘research’ or ‘development’ function in Japan and Britain1

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was more readily apparent among Japanese R&D staff (13 percent) than among their British counterparts (6 percent). However, the greater availability of ‘free time’ in Japanese laboratories has to be set against the average length of the working week as reported by our respondents. Returning a few hours back to Japanese R&D staff in the form of ‘free time’ makes small inroads into the discrepancy, compensating for up to only 40 percent of the difference in working time. The depth to which the lives of Japanese R&D staff were wrapped up in layers of corporate fabric was impressive not only by formal hours of work (including compulsory overtime); it became even more enveloping when out-of-work socialising was added to the picture of the everyday life. Japanese R&D staff were much more likely to number colleagues from their company among social life then their British counterparts who tended to nominate comparable professionals from other companies among social contacts. Certainly the percentage suggesting that socialising always included company colleagues was much higher (30.1 percent) than among the British respondents (5.3 percent) (see Table 6.5). The penetration of corporate life into out of work hours was even more striking when we note the extent to which supervisors and managers were included as ‘ever present’ (12.5 percent) or frequently (25.5 percent) in Japanese social contacts compared to their relative invisibility in the out-of-work hours social life of British R&D staff (see Table 6.6). Managing project work Many of the differences emerging in comparisons and contrasts at the micro level of R&D project management fit into the more general systemic differences which have been evident in the organisation and management of R&D work in Japan and Britain. For example, the distribution of projects among R&D staff, the manner in which they are monitored and the factors which R&D engineers and scientists feel are important for project success are all strongly related to the technology strategies adopted by Japanese companies and the practice of lifetime employment.

Table 6.5 R&D staff reporting out-of-work social contacts with colleagues (%)1

1 These percentages record those answering that social contacts ‘always’ included colleagues. The percentages in brackets record report ‘frequent’ contact. Source: International Survey of R&D Workers

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Table 6.6 R&D staff reporting out-of-work social contacts with supervisors (%)1

1 These percentages record those answering that social contacts ‘always’ included supervisors. The percentages in brackets record report ‘frequent’ contact. Source: International Survey of R&D Workers

Airport bookstalls carry many books on Japanese business etiquette, designed to equip foreign readers with charts, diagrams and explanations of the physical layout and symbolic significance of the Japanese open-plan office. Typically, they tell a visitor that the layout will reveal the office status hierarchy by presenting the most junior by the entrance to greet the visitor and the most senior manager furthest from the entrance. But, whilst this layout reveals hierarchical differences, it is claimed to show a strong dose of egalitarianism by demonstrating that the manager is to be found in the rectangle, living ‘cheek by jowl’ with and always available to subordinate staff. Often the foreign reader is gently reminded that this physical layout can be contrasted with the more traditional picture of life in the Western companies, with Western managers tucked away in separate offices, physically and socially remote from their subordinates. R&D laboratories and offices reflected some of these characteristic differences. Although, on average, British R&D staff appeared to carry only slightly more projects than their Japanese counterparts in the International Survey of R&D workers, the way in which projects were distributed across grade levels was more suggestive of the deeper, more systematic and significant differences between the Japanese and British laboratories. Striking difference emerged in the project responsibilities of R&D staff in Japan and Britain when these workers were distinguished into three grade levels —‘the fully fledged’ engineer or scientist (that is, those beyond the training experience of early careers and forming the mainstay of project work), the project leaders and the R&D managers. In Japan, there was a steady increase with experience in the number of projects for which an engineer or scientist was responsible (see Table 6.7). However, in Britain, while project responsibilities increased with experience, there was a much sharper increase in project responsibilities for the managers (compare Table 6.5). Where the JPC account portrayed the Japanese manager as the ‘player manager’, the most fitting counterpart to this would be the characterisation of the British manager as the ‘non-playing captain’ (JPC 1991a:42– 3). The relatively lower project loading for Japanese managers is consistent with the impression of the Japanese career as a gradual unfolding of deepening responsibilities and the expectation that the Japanese R&D manager should maintain a ‘hands-on’ involvement in R&D projects. In contrast, the larger number of projects carried by British R&D managers was consistent with the notion of a career step

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Table 6.7 Number of projects for which an R&D staff member is responsible by position

Source: JPC (1991a)

change and much sharper disjuncture in responsibilities in moving to managerial levels and the expectation that the British manager would become much more heavily engaged in paperwork and administrative duties to the relative exclusion of a ‘hands-on’ technical involvement in projects. While some caution is necessary with the use of the general term of kanrisha for manager in the Japanese questionnaire and the possibility that it does not distinguish sufficiently between the rank and the position of manager in the Japanese system, the context of questions on graded levels of responsibility makes it safe to interpret as a question comparing like Japanese managers with like British managers in terms of position and associated duties. Projects employing the Japanese R&D staff tended to be longer (2.8 years) on average than those employing the British R&D staff (2.2 years). Differences in the character of R&D careers and technology management were evident when considering the respective time intervals for project progress monitoring in the two national samples. While British engineers and scientists had periodical project monitoring reviews every three months or so, irrespective of rank, the time intervals for project reviews among the Japanese R&D staff varied according to rank, with more frequent reviews reported among the lower rank and less experienced R&D staff. Again, this was consistent with the Japanese conception of a more graduated path of career development with increasing responsibility being extended with growing experience. British R&D staff, on the other hand, saw themselves as ‘fully fledged’ relatively soon after graduation and entry to the world of R&D work, were more likely to be expected to fill a particular post—and perform at a level appropriate to post—rather than according to a set of expectations shaped by age and seniority. Given that the Japanese respondents were more likely than the British respondents to be working on the research end of the R&D spectrum, we might expect that there would have been some differences between the national samples, other things being equal, in the responses to questions about project management. For example, project lengths in research tended to be longer than those in development and this difference, plus the differences in sample compositions, underlies the differences in average project lengths on which the respective national samples worked. However, Japanese and British R&D staff shared some common perceptions of R&D activity, notably that a paramount factor making for successful R&D projects is the setting of ‘clearly established research goals’ (Japan 62 percent and Britain 74 percent). However, in a question permitting multiple responses, the secondary and tertiary responses showed some national differences. Japanese

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respondents gave more prominence to ‘an organisational culture which accepts risk’ and ‘the administrative ability of managers and project leaders’ than the British respondents who were more likely to draw attention to ‘R&D facilities’ and to ‘smooth communication among research, manufacturing and marketing departments’. Concern about risk-taking does not necessarily mean that Japanese R&D staff were more adventuresome in R&D than the British engineers and scientists, rather that in the context of the considerable uniformity in the managed careers of Japanese R&D, rather more Japanese engineers and scientists felt that innovation would need increased readiness to experiment. Conversely, given the enormous effort put into enhancing communication flows and co-ordination in Japanese R&D, it is not surprising that this appears to be almost taken for granted, whereas it attracted more attention among British R&D staff. Reward systems The salary patterns observable among R&D staff in Japan and Britain reflect the broad character of ‘organisation-oriented’ and ‘market-oriented’ career systems. Thus while seniority plays a part in both systems, it is more evident in Japan than Britain (see Tables 6.8 and 6.9). However, both systems have been changing, with the British companies increasingly conscious of the need to design salary remuneration in line with external comparisons and Japanese companies keen to press the importance of merit in salary decisions. While salary is the main source of reward and index of performance, it is not the sole factor. The availability of intrinsically interesting work and the ‘free time’ to undertake interesting projects were among the additional compensations available for management discretion, and seemed to be more prized in the Japanese rather than British laboratories. Writing in the early 1970s, Dore noted that both Japanese and British pay systems had complexity in common, albeit their own peculiar and characteristic complexities. Yet, apart from complexity, he concluded that ‘the two systems have almost nothing in common’ (Dore 1973:74). Perhaps curiously, viewed from the 1990s, the various waves of reform since the 1970s appear to have yet more layers of complexity. For example, the graphical picture of Figure 6.1 showing the pay system of the 1970s, look simple when contrasted with the pay system of the 1990s in Figure 6.2.

Table 6.8 Reward level by age cohort1

1 The reward levels are based on the country average=100. Source: Davis 1995 (International Survey of R&D Workers)

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Table 6.9 Reward level by stage of career development1

1 The reward levels are based on the country average = 100. Source: Davis 1995 (International Survey of R&D Workers)

In the early 1970s, the Japanese economy was still experiencing double-digit growth and there was a relatively youthful labour force enjoying expanding employment and promotion opportunities. The strong weight to seniority in the pay system had a recognised economic rationale at the individual level in giving due regard to growing proficiency and at the level of companies and the economy in encouraging stability in the labour force. Contents and discontents R&D staff in both Japan and Britain seem a fairly contented lot, whether thinking of work in general or the content of their current work (Tables 6.10 and 6.11). Satisfaction with the content of their current work was widely reported in Japan (88.6 percent) and Britain (85.1 percent), while the more holistic question about job satisfaction prompted widespread levels of satisfaction too—Japan 77.0 percent

Figure 6.1 Wage composition under the seniority-oriented system Source: Davis 1988

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Figure 6.2 Salary composition under the shokunoshikaku system Source: Davis 1988

and Britain 79.7 percent. Contentment with the intrinsic rewards of R&D work was further corroborated by the accounts of dissatisfaction where few of the national samples reported mismatches between their interests and the work which had been allocated to them (Tables 6.12 and 6.13). While R&D staff appear broadly satisfied with their status in their companies in both countries, this aspect is more pronounced in Japan (81.4 percent) than in Britain (65.6 percent). While the extrinsic rewards of salary and promotion are generally positive in both countries, much the lowest level of satisfaction with income is evident in the Japanese electronics company.

Source: International Survey of R&D Workers

1 Percentage reporting either very satisfied or satisfied

Table 6.11 Degree of satisfaction with aspects of work in Britain1

1 Percentage reporting either very satisfied or satisfied Source: International Survey of R&D Workers

Table 6.10 Degree of satisfaction with aspects of work in Japan1

Source: International Survey of R&D Workers

Table 6.12 Sources of dissatisfactions among Japanese R&D staff (%)

Source: International Survey of R&D Workers

Table 6.13 Sources of dissatisfactions among British R&D staff (%)

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Overall, the British respondents seem more likely to express higher level of satisfaction with pay (Tables 6.10 and 6.11). Issues connected with working time furnished much of the reported dissatisfaction among the Japanese R&D engineers and scientists and made for contrasts with the British R&D engineers and scientists (Tables 6.12 and 6.13). Although the overall numbers expressing dissatisfaction with long working hours did not appear pronounced among the Japanese sample (24.3 percent), their incidence appeared more significant when broken into the development end of R&D, with a greater concentration of dissatisfaction (46.0 percent), and research (only 14.3 percent). By contrast, complaints against the length of working hours were negligible among the British sample, although those expressing some complaint followed the same pattern across development (6.9 percent) and research (1.9 percent). Again, concerns about the tightness of research schedules were more marked among Japanese R&D staff (27.9 percent) than their British counterparts (14.5 percent), and a similar breakdown into research and development showed again the more acute sense of time pressure among the Japanese development sample (39.8 percent) compared to research (24.2 percent). Although showing the similar distinctive pattern across departments, the numbers reporting concern in the British development (15.0 percent) and research (13.2 percent) laboratories suggested less intense pressure. Further aspects of the Japanese engineers’ and scientists’ perceived lack of control over their working lives was evident in their higher levels of reported discontent over the lack of holidays and the lack of ‘free time’ for ‘under-thecounter’ research time. Nearly a quarter of the Japanese R&D sample (23.4 percent) expressed dissatisfaction with the lack of opportunities for paid leave, although one Japanese company, ‘J-drink’, approached the much lower levels of concern with holidays in the British companies, where overall concern was very tiny (3.9 percent). Within company working time, complaints about the adequacy of opportunities for independent research time formed the second most common source of discontent among the Japanese R&D staff (44.9 percent) but roused much less widespread concern among the British sample of R&D staff (15 percent). Although the incidence of concern varied across the British companies, in no companies did the numbers expressing concern reach the levels expressed among the Japanese samples (Tables 6.12 and 6.13). Although a 1994 survey of R&D workers does not record the acute levels of concern about working hours registered in the 1988 survey, it has strong similarities in noting the discrepancy between the reward systems favoured by companies and by R&D staff (Ishida 1998). While companies put the emphasis on managerial promotion and pay, the R&D workers stressed their desire for greater autonomy in working time and research themes. Perhaps surprisingly, in view of the relative volumes of national debate on education and training issues, complaints over the adequacy of opportunities for education and training were less common in Britain compared to Japan. Yet on this topic we can see the importance of simply aggregating responses to assume national effects, for concerns about educational opportunities vary

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widely across companies in both country samples. There is nearly a threefold increase in ‘J-drink’ over ‘J-comm’ in complaints on education, while the variation is nearer tenfold in Britain between the most concerned group of R&D employees in ‘B-elec’ over the least concerned group in ‘B-drink’. Although we have noted that the highest levels of discontent expressed in both countries dwelt on perceived personnel shortages in R&D, a distinctive feature of the British complaints compared to those of the Japanese sample lay in the clustering round promotion issues. Lack of clarity and poor definition about personnel policies were voiced by many of the British engineers and scientists (40.8 percent), while another cluster of dissatisfactions centred on the lack of prospects for promotion and salary increase (31.4 percent). Adverse comments about the adequacy of budgets and facilities were more common in Britain (37.9 percent) compared to Japan (27.7 percent), but levels of concern varied greatly across companies in both countries. For example, the level of dissatisfaction were nearly six times higher in ‘J-elec2’ (44.0 percent) compared to ‘J-comm’ (7.6 percent) among the Japanese companies. In Britain, although the disparity between companies with the most and least widespread dissatisfaction over facilities was greater, it occurred in a similar pairing of an electronics company (55.4 percent) and a communications company (14.8 percent), (see Tables 6.12 and 6.13). The scope for collective voice: professional institutions and unions Faced by some areas of dissatisfaction, to what extent can professional-level engineers and scientists aggregate their concerns and find collective voice to advance their common interests? The two main types of occupational organisation available for occupation groups to further their collective representation with employers in capitalist industrialism have been the professional institution and the labour union. Each type has had rather different rationales and modus operandi, although in practice professional institutions and craft unions might appear to achieve similar effects through restricting the supply of labour. In Britain, professional institutions have largely expressed interests in operating as ‘learned societies’ and acting as ‘qualifying bodies’. The first function can be achieved by advancing knowledge and skills in a technical field by facilitating communication such as publications and conferences, while the second function can be achieved by setting standards of competence through the design of syllabuses and examinations. Historically, the qualifying function has been important in Britain as occupational interest groups began in the latter half of the nineteenth century through ‘self regulation’ to define education and training levels before the state began to play a major role in education and training. By contrast, with the state playing a leading role in Japanese industrialisation and taking the leading role in the establishment of advanced engineering education and training, the professional institutions (gakkai) in

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Japan have confined themselves to the role of learned societies. Of course, in both Japan and Britain, the professional institutions have tried to promote the public image and perception of the occupation and their members through public relations activities, particularly directed at schoolchildren. For example, the Japanese Society of Mechanical Engineers (JSME), founded in 1897 to ‘advance science and technology, and thereby contribute to the development of industries’, has launched campaigns to promote the image of engineering and industry amid fears that increasing number of Japanese youth perceive industry as ‘dirty, dangerous and difficult’. The balance of ‘learned society’ and ‘qualifying body’ roles in professional institutions has varied over time and across sectors. As the state has taken more responsibility for the provision of higher education in Britain, the significance of qualifying functions and professional institution examinations has waned. Their significance has generally been less in science than engineering since a larger proportion of professional scientists have emerged through full-time study in universities rather than the part-time educational route supplementing employment and on-the-job training which dominated engineering until the 1960s. The more prestigious institutions have operated under Royal Charter and have claimed that their Charters and charitable status (carrying tax benefits) have limited them to act in the interests of engineering and science rather than for the direct self-interest of engineers and scientists. Thus while they might publish salary surveys and campaign about general salary levels, they have not attempted to engage in collective bargaining on behalf of members. Collective bargaining and the more direct intervention on behalf of their members has been the stock in trade of labour unions, although a variety of unions have contested the appropriate character, strategy and tactics for ‘professional unionism’. Prandy suggested that professional engineers would tend to opt for either professional institution membership or trade union membership depending on their position in the labour market and authority structure of an enterprise and their perception of social hierarchy and social advancement (Prandy 1965). Comparing memberships of professional institutions and labour unions, we can see that both kinds were much more common among Japanese R&D workers than among their British counterparts (Tables 6.14 and 6.15). Again, however, union membership is one of those dimensions of comparison which is best pursued by disaggregation of the national samples to take a closer look at the company context, for there are some significant variations by company in both memberships and the claimed benefits of membership. Over two thirds of the Japanese sample of R&D workers were members of professional institutions (67.7 percent) compared to over half of the British sample (54.0 percent). The highest level of membership was found in the telecommunications company ‘J-comm’ (98.9 percent). The strong publicservice ethos and tradition of regulation associated with the telecommunications industry have probably encouraged membership, and the ‘B-com’ showed a relatively high level of membership (62.3 percent) among British R&D staff.

Source: International Survey of R&D Workers

Table 6.15 British membership of collective organisations (unions and professional institutions) (%)

Source: International Survey of R&D Workers

Table 6.14 Japanese membership of collective organisations (unions and professional institutions) (%)

Source: International Survey of R&D Workers

1 The percentages noting the professional institution as the most important of the professional organisations to which they belonged.

Table 6.17 The significance of professional institution membership in Britain (%)1

Source: International Survey of R&D Workers

1 The percentages noting the professional institution as the most important of the professional organisations to which they belonged.

Table 6.16 The significance of professional institution membership in Japan (%)1

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The lowest level of membership in Japan was found in the electronics company, ‘J-elec2’ (40.5 percent). Professional institution memberships showed marked variations across the British companies, ranging from the high of 68.4 percent in the small central laboratory of ‘B-drink’ to the low of 43.7 percent in ‘Bfibre’. Of the variety of professional organisations to which R&D staff can belong from the more formal professional institutions to the less formal in-house R&D seminar, professional institutions emerged as by far the most important for R&D engineers and scientists in both Japan (84.2 percent) and Britain (70.3 percent) (Tables 6.16 and 6.17). While small numbers of professional institution members in both countries saw little benefit from membership, the overwhelming majority in both countries emphasised the personal gains from the ‘learned society’ function of gaining technical information in relevant fields of work, Japan (66.9 percent) and Britain (64.8 percent) (Tables 6.18 and 6.19). In the light of the importance attached to publication by the Japanese R&D engineers and scientists seen earlier, it is perhaps not surprising that opportunities to present research results through the professional institutions are the second most important benefit in Japan (50.0 percent) and far outdo its importance in Britain (5.6 percent). Not only do the Japanese companies set high store by publication in gauging career progress, they concede that internal labour markets limit the opportunities for technology transfer and the stimulation of R&D by mobile engineers and scientists. Therefore Japanese companies encourage the presentation of R&D results as part of professional development. Contacts with professional staff outside the confines of one’s own employer serve as compensatory mechanisms for the relative lack of developed external labour markets and are appreciated by the Japanese R&D staff. In addition to the prevailing importance of the learned society function, over one third of the British engineers saw important benefits in the social contacts (38.5 percent) and the educational opportunities (38.5 percent) made available by professional institutions. Reflecting their historic qualifying role in Britain, the British respondents (28.5 percent) were much more likely to appreciate the statusconferring benefits of institutional membership than their Japanese counterparts (6.7 percent). Campaigning to improve working conditions has been the historic mission of labour unions under industrial capitalism so that it is hardly surprising that this is the most frequently cited benefit from union membership in the two countries, Japan (38.1 percent) and Britain (37.2 percent), (see Tables 6.20 and 6.21). Yet this similarity needs some caution, for it must be remembered that the bases of unionism are different in the two countries and that over half the union members in both countries find no specific benefits from union membership. Union organisation is far from central to the lives of most R&D workers and is not seen as a focus for their personal advancement, which is largely going to be achieved by individual career advance rather than collective organisation. While the overall level of unionism among the Japanese sample of R&D staff (60.6 percent) is twice that in the British sample (29.6 percent), there are large variations across the companies. The main axis of union membership in Japan is

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the enterprise union (rather than the occupation or industry) to which all regular employees belong up to managerial levels (typically up to kacho or section manager). The surprisingly low level of union membership in the ‘J-comm’ sample is a product of sampling since 92 percent of the respondents were in the managerial grades and ineligible for union membership. In many Japanese companies, the enterprise unions were reshaped in the early 1950s when company managers were aggressively determined to rout radical unionism by outflanking devices, including the fostering of alternative union structures. ‘J-elec2’ is somewhat unusual in having two unions from these more turbulent times, the rump of the original radical enterprise union and the reformed and company-supported ‘new’ enterprise union, largely quiescent and co-operative in character. The relatively low level of unionisation among the ‘J-elec2’ sample (40.5 percent) cannot be explained by a high number in managerial grades (only 10.5 percent of the sample) and an explanation is more likely to be found in company style and the character of industrial relations in the company. The level of unionisation was significant in only two British companies, ‘B-comm’ (70.5 percent) and ‘B-fibre’ (59.0 percent), and low (21.4 percent) in a third, ‘B-drink’, and negligible in the remaining three companies (see Table 6.15). Only in one company in the two countries, ‘B-comm’, were respondents sanguine about the prospects for union members to mobilise shopfloor opinion to influence management policy. Conclusions At first sight, the arrival of Japanese debates about the employment conditions of R&D workers some two decades after debates on some similar issues in the US and Europe might appear like a latter-day vindication of the ‘convergence thesis’ of the 1960s, that societies would face technological imperatives propelling them towards increasing similarities in social structures. However, this would be a simplistic conclusion. First, I have argued that much of original debate on the professionalism of scientists and engineers in American and European industry was misconceived. Industrial R&D staff rarely wanted to espouse professionalism in the manner of academic scientists. Secondly, the Japanese debate has had a different starting point and different contexts, has been couched in different terms and has been viewed within different theoretical frameworks; what is more, the historical patterns of institutional development still carry considerable weight in contemporary arrangements. One path to the resolution of the paradox of greater and more widespread professionalism among the Japanese R&D scientists and engineers compared to their Western counterparts lies in recognising that the paradox is more apparent than real. The behavioural measures of professional organisation membership and publication have been dimensions along which ‘professionalism’ has been measured and along which lines of conflict between ‘professionals’ and ‘business bureaucracies’ have been discussed by social scientists in the context of the greater application of science and technology to industry in Europe and the US. It was widely assumed that business would find tensions with the value commitments of

Source: International Survey of R&D Workers

1 Respondents were asked to answer in terms the most important professional organisation to which they belonged.

Table 6.18 Benefits of professional organisation membership in Japan (%)1

1 Respondents were asked to answer in terms the most important professional organisation to which they belonged. Source: International Survey of R&D Workers

Table 6.19 Benefits of professional organisation membership in Britain (%)1

Source: International Survey of R&D Workers

Table 6.20 Benefits of union membership in Japan (%)

Source: International Survey of R&D Workers

Table 6.21 Benefits of union membership in Britain (%)

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scientists and engineers to public communication and with their loyalty to professional associations. However, far from being antithetical to business, we find that these institutions serve distinctive purposes in the context of the Japanese employment system. Far from being in conflict with their employers, Japanese R&D workers appear more likely to be rewarded for their participation in associations and for their output of publications. However, when we turn to the comparative attitudinal measures, there is a another path to the resolution of our apparent paradox. Here, we find evidence among the Japanese R&D workers of ‘a latent need for individual professional profiling’ (Ernst 1995:90). Ernst argues that we should not take the survey results simply at face value; rather, we should interpret them as clues to subjective perceptions held by R&D workers of their work and employment context. Thus, the strong emphases put by Japanese R&D workers on ‘more freedom’ should not be interpreted as some free-floating and absolute commitment to a universal value but seen as an indicator of a ‘deficit’ in their current experience (Ernst 1995:89). Meanwhile, the more ready emphasis on career advancement opportunities expressed by British R&D workers can be taken as evidence of ‘deficits’ which they see in employment. If Japanese R&D workers perceive deficits and some dissatisfaction, we might speculate on how far such ‘latent’ professionalism might be manifest in conflict with employers—for example, in collective voice. The two main types of occupational organisation available for occupation groups to further their collective representation with employers in capitalist industrialism have been the professional association and the labour union. Each type has had rather different rationales and modus operandi, although in practice professional associations and craft unions might appear to achieve similar effects through restricting the supply of labour. With the state playing a leading role in Japanese industrialisation and taking the leading role in the establishment of advanced engineering education and training, the professional associations (gakkai) in Japan have confined themselves to the role of learned societies. Of course, in both Japan and Britain, the professional associations have tried to promote the public image and perception of the occupation and their members through public relations activities, particularly directed at schoolchildren. However, they have not appeared likely bodies to mobilise as lobbies on employers for the enhancement of working conditions for engineers and scientists. The standard rationale of labour unions has lain in collective bargaining and a more direct intervention on behalf of their members’ interests. Japanese R&D workers were much more likely to be union members than British R&D workers since it was an expectation of all regular workers up to management levels. However, the Japanese enterprise unions, representing the broad span of company employees, have often been seen as part of the problem of R&D workers rather than part of the solution. Union agreements with companies have inhibited company efforts to have separate scales for R&D workers or to single out high performance. In one interview, an R&D manager pointed to the union agreement as a major constraint on company freedom to reward very able R&D workers but hoped that the promise of much greater freedom in rewards in the equivalent of managerial grades would

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retain the loyalty of patient R&D workers. However, he conceded that they would need the virtue of patience in the meantime. If collective remedies appear limited, the other prospects for change in the employment conditions might come through foreign example and pressures in the labour market. The increasing presence of foreign R&D laboratories established in Japan will present foreign companies with the dilemmas of adapting their home patterns of human resource management to local conditions, while Japanese companies face similar dilemmas in their attempts to move overseas (Westney 1993b). Some Japanese companies have recruited foreign nationals to their laboratories in Japan, partly to ease labour shortage and partly to introduce ‘creative refreshment’. However, some small-scale research suggests that far from reorienting the Japanese laboratories, the foreign researchers experience considerable frustration (Kurata 1990). Meanwhile, beyond the industrial laboratories, the Japanese service sector has been able to offer terms and conditions of employment for increasing numbers of the able science and engineering graduates of the elite universities. Thus, the widening scope of employment opportunities may hasten the urge to learn about alternative patterns of organisation and employment, and in this comparative studies play their part. Note 1 Functionalism was an influential paradigm within sociology in the 1950s and 1960s, emphasising the role of social institutions (or social structures) in ensuring the satisfactory performance of important processes (or functions) for the survival of a society. By the 1970s, interactionism was seen a major alternative paradigm to structural functionalism. Where functionalism started from the macro level of the needs of society, interactionism focused on the more micro level of the way that social actors took up their roles in society through the processes of symbolic communication.

7 Engineering transplants

‘…It may be that the “obstacles to Japanisation”…are more deep-seated, perhaps more “culturally embedded”, than we originally believed.’ (Oliver and Wilkinson, second edition, 1992:321).

Introduction Tanaka-san,1 the Managing Director of a Japanese electronics company in the west of Scotland and an engineer by training, liked to tell his Scottish employees about Henry Dyer, the Scottish engineer who had gone from this local area to found the Imperial College of Engineering in Tokyo in the 1870s. The twinkle in his eye and the wry smile were ample evidence of the irony he felt in teaching local history (and its international impact) to his staff, but Tanaka drew a deeper comfort from his personal feeling of repaying a debt to those British engineers. Now his factory could play a part in generating jobs in the manufacturing sector. He confessed his surprise that some skills and technologies appeared to him to have been lost in recent years in the UK, apparent in the difficulties in securing supplies of consistent quality steel and other supplies. But he hoped that the stimulus to suppliers from the factory would play its part in the region’s industrial regeneration. In many ways, the arrival of the Japanese engineers in the UK to set up and operate the transplants seems like turning the wheel full circle from our starting point in Chapter 1, and Henry Dyer and the ‘hired foreigners’ (many of them engineers) who took British technology and engineering knowledge and skill to Japan in the Meiji era. Then, Britain was regarded as the ‘workshop of the world’ and the source of industrial bestpractice’. By the 1980s, Japan had become the source of models of ‘best practice’ in industrial technology, organisation and management, with foreign missions beating a path to Japan in search of ‘lessons to be learned’ and practices to be imported. After several chapters in which the emphasis has been on the contrasts between engineers working in their home environments in Japan and Britain, this chapter returns to cross-cultural and cross-national themes. The central questions are about the arrival and impact of Japanese engineers on the transplant operations of their parent companies, and the crossing of cultures in

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their working relations with British engineers and scientists in the transplant factories and R&D units. The rapid growth in the numbers of Japanese-owned manufacturing plants in the UK in the second half of the 1980s provoked much debate. Although the pace of Japanese investment in Europe has slowed with the burst of the ‘bubble economy’ in Japan and recession in the 1990s, the slower growth of the European economy in the 1990s and the pull of alternative investment opportunities in east Asia in the early 1990s, there has been continued growth in the number of plants opened and a deepening of earlier investments with increases in the numbers of R&D units established. While the UK has attracted the major share of the Japanese investment in Europe, it has witnessed some of the sharpest debates about the strategies of the inward investment and its impact. Can Japanese engineers successfully transplant Japan’s manufacturing operations overseas? Are Japanese transplants in the UK little more than warehouses serving the needs of screwdriver activities in the assembly of imported parts? Can Japanese technology play a part in the regeneration of British manufacturing industry? What employment and career opportunities are open with the recruitment of British engineers and scientists to work with Japanese counterparts in overseas R&D units? The arrival of the transplants has not been without criticism. Some critics have doubted either the feasibility of transfer or the desirability of transfer or even both aspects. Even enthusiasts, such as Oliver and Wilkinson who introduced ‘Japanisation’ into British discussions of Japanese inward investment, have become more circumspect about the feasibility of effective transplants, as shown in the passage quoted above. Some critics argue, first, that Japanese companies will have little interest in transferring R&D, leaving only low value-added, low-skill, lowly paid types of employment and, second, that even if they had the desire, their Japanese engineers would not be able to introduce the key element of Japanese technology and Japanese work organisation to the UK because these features are too dependent on Japanese culture and social organisation. And even if the transplant process were feasible, then some critics question whether it would be desirable from the host country’s perspective because the price paid would be to transform many institutional features of British industry into forms and practices more closely Japanese, for example in industrial relations. Most of the attention given to transplants has concentrated on either the economic implications for the economy or the job opportunities and industrial relations implications for blue-collar workers. Engineers have been largely overlooked. However, technology transfer is a complex process in which engineers are critical agents. To be effective, Japanese companies need Japanese engineers as expatriates who can introduce new processes and products. But if companies are to fully globalise their activities, they will need to employ British engineers who can liaise effectively with the Japanese engineers on company sites in Japan, particularly if they seek to upgrade their technological capability in the overseas plants. In exploring the roles of Japanese and British engineers in

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transplants, I shall start with the broad picture of the supply side of inward investment—that is with the purposes and modes of inward of investment. The supply side will be followed by an examination of the demand for Japanese inward investment, particularly the sometimes heady and optimistic expectations generated for Japanese inward investment. These mixtures of motive and expectation set the context for considering the ‘Japanisation debate’ and the arguments about the prospective impact of the transplants. Turning from these very broad-brush debates on the Japanese transplants to a more finely detailed examination of the relations between Japanese and British engineers, it is important to bear in mind the very different career paths through which they have arrived at the transplants. Examination of the development of R&D units will cover both those ‘attached’ to manufacturing plants and the ‘independent’ units too. The final section will draw some threads together on the activities of engineers and scientists in transplant operations. The supply side of Japanese foreign direct investment The first Japanese transplant in the UK was established in by the zip-maker YKK as part of the company’s strategy to locate close to its customers in the fashion industry. YKK rapidly set up manufacturing plants across Europe. However, this conduct stood out in marked contrast to the vast bulk of Japanese manufacturers who were content to remain in Japan and sell abroad. Even in the early 1980s, Trevor had dubbed Japanese companies as ‘reluctant multinationals’ for their fear of leaving their very familiar and supportive domestic environment (Trevor 1983). By contrast the service sector had a much longer history of overseas operations stretching back into the Meiji era, often designed to support the overseas sales of manufacturers. However, two factors prodded the manufacturers to establish plants in Europe from the mid-1980s: first, the rise in value of the yen (endaka) following the 1985 Plaza Accord of the G7 countries, and second, the plans in Europe for the ‘single market’ (Dicken, Tickell and Yeung 1997). The overall growth of investment in Europe had much to do with perceptions and fears that the institutions of the single market would be a ‘Fortress Europe’ in the EC with exclusion of Japanese goods by tariff barriers. The relative novelty of this rise in Japanese manufacturing investment in Europe must be set in the context of the relatively recent increase in total overseas manufacturing investment—for example, the total for 1984 to 1989 matched that for the whole of the period 1950 to 1983 (Fitzpatrick Associates 1991:1). The main destination over this period was the US, with its share rising from 33.1 percent in 1984 to 48.2 percent in 1989. Meanwhile, the European share increased more modestly from 19.1 percent to 21.9 percent in 1989. By the end of 1996, the manufacturing investment in Europe had become heavily concentrated in three countries—the UK (223 firms), France (114 firms) and Germany (101 firms). Britain has not only secured the largest proportion of manufacturing plants, but the largest proportion of plants with R&D bases and

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the largest share of ‘independent’ R&D units (see Tables 7.1 and 7.2). Overall Britain had secured the largest share of Japanese-owned employment in the 12 EC countries in 1993. It must be remembered that the Japanese presence in Europe is still relatively small whether it is considered in terms of its proportion of Japanese investment abroad or total foreign investments in Europe (Micossi & Viesti 1991). Britain has had the largest proportion of total investment with several reasons cited for this prominence: the role of the English language as an international language for business, science and technology together with the greater familiarity of Japanese businessmen with English compared to other languages; the very consistent and positive attitude adopted by the Thatcher government towards foreign investment; strongly pro-business policies from investment incentives to favourable taxation policies; cost advantages, particularly labour cost, and large pools of relatively cheap labour available in several development regions; and relative stability in terms of politics and industrial relations. If they were to secure their proprietary advantage in manufacturing, we might expect that Japanese manufacturers would opt for 100 percent wholly owned direct investment rather than joint ventures. This preference has been clear in their UK operations, although capital participation has been more prominent in some other EU countries where foreign entrants faced less congenial political and legal conditions (JETRO 1997). Electronics and electrical equipment manufacturers have been the largest single sector (28 percent) of manufacturing investment and the typical form of investment has been similar to that in one manufacturing plant on a ‘greenfield site’, employing 346 people and with capital of $ 11 m. Definitions of ‘greenfield sites’ vary, but have typically included reference to a new physical site and buildings, a new labour force, and new production technology. It is often contrasted to a ‘brownfield site’ where a company takes over one or more of these elements from physical plant to labour force. The combination of 100 percent ownership and a ‘greenfield site’ should give a foreign investor considerable authority and scope to introduce new methods of working—for example, methods familiar in home country plants. The industrial relations problems of introducing change in joint ventures and ‘brownfield sites’ were vividly portrayed in some of the television plants in Britain, and after the break-up of the joint ventures the Japanese partners took on the task of trying to convert ‘brownfield sites’ into quasi-‘greenfield sites’ (Bassett 1986). The demand for Japanese foreign direct investment The demand for inward investment can be distinguished into two components at the national and local level. For the Thatcher governments of the 1980s, Japanese manufacturing investment offered solutions to some of Britain’s shortrun economic problems: investment in car plants and electronics plants offered not only jobs to mitigate high unemployment levels, but also goods to substitute for imports and to ameliorate the balance of trade problems of the British

Source: Adapted from JETRO 1994 and JETRO 1995

1 Percentage of ‘attached R&D units’ in brackets.

Table 7.1 Manufacturing plants and the R&D intensity of Japanese manufacturing in Europe

Source: Adapted from JETRO 1996.

1 Figures in parentheses indicate the number of ‘independent’ R&D laboratories.

Table 7.2 Number of R&D units established by Japanese companies in Europe

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economy. In the longer run, there were hopes that inward investors might bring solutions to long-run decline in manufacturing competitiveness in the physicsbased industries. Japanese direct investment in particular offered the prospect of technology transfer and the spread of ‘best practice’ in work organisation and management. If Britain’s oil bonanza were to end and the British economy were to need a revived manufacturing industry, Mrs Thatcher’s government placed little faith in the prospects for the familiar industrial practices of the 1970s. Japanese inward investors were seen as part of the longer-term drive to reinvigorate British manufacturing industry. At a more local or regional level, there was strong competition for inward investment between Britain’s depressed regions to stimulate industrial regeneration. Aided at the national level by ministers of cabinet rank and backed by substantial budgets, the Scottish and Welsh development agencies were powerful suitors for Japanese investment. The English regions could match neither the political nor the economic strength of the Scots and the Welsh, but the northeast region in England and the new town corporations in Milton Keynes and Telford made spirited bids for Japanese investment. Images of car assembly plants and their tiers of suppliers located nearby for just-in-time production conjured up images of a primary round of investment followed by secondary rounds of investment and multiplier effects through the local economy. Local authority representatives joined missions to Japan to persuade companies of the advantages of their region in presentations which ranged across geographical advantage to local labour markets and educational provision. Using land-use regulations and their planning consent powers, the local authorities had the power to put together parcels of land for inward investors. In the case of Toyota’s site for its assembly plant near Derby, the European Commission judged that excessive enthusiasm had been used through the provision of land below market price, and Toyota was required to pay back £4.2m to the Derbyshire County Council to avoid charges of unfair competitive advantage (Palmer 1991). The less prosperous regions (Scotland, Wales and the north) secured significant shares of the Japanese plants compared to the more prosperous and populous regions (south-east and west Midlands). However, as Darby noted, they have been less successful in attracting technological upgrading in the share of R&D units, whether attached to or independent of manufacturing plants (Darby 1996). Debates on ‘Japanisation’ and technology transfer One approach to gauging the success of Japanese engineers and managers in carrying ‘best practice’ manufacturing technology has been to draw up a list of features of Japanese manufacturing organisation in Japan and use them as a checklist against which overseas operations could be measured. In some accounts, these features are seen as theoretically and empirically linked to generate the much-acclaimed ‘best practice’ manufacturing of Japanese industry. Figure 7.1 provides one example of this approach (Oliver and Wilkinson 1992). The issues raised here are the relations between the main elements of

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manufacturing methods’, ‘organisational structures and systems’, ‘personnel practices’ and the ‘wider social, political and economic conditions’. Tight interdependence would imply that engineers would not be able to introduce kaizen (continuous improvement) without changes in associated organisational, personnel and wider societal institutions. However, a looser ‘fit’ between institutional elements would imply more scope for the creation of ‘hybrid’ institutions, for example by grafting ‘Japanese features’ of manufacturing methods on to ‘British personnel practices’. Although Oliver and Wilkinson were confident in their first survey (1988) that such features were being transferred, their second survey (1992—quoted above) was much more guarded about the prospects for transfer. However, other writers have doubted the alleged benefits of Japanese manufacturing transplants in the US and Europe for the host countries. Terms such as ‘screwdriver plants’ or ‘warehouse’ operations deny any worthwhile technology transfer to the host country and conjure up the image of low-skilled, low-paid employment. Using data from the US Department of Commerce and the UK Census of Production, Williams and his colleagues portray the transplants as essentially ‘warehouses’, assembling

Figure 7.1 A checklist of ‘Japanisation’ Source: Adapted from Oliver and Wilkinson 1992

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imported components, rather than ‘factories’ engaged in full manufacture (Williams et al 1992). Claiming that the alleged benefits have been subject to much exaggeration, they rest their case on four broad points: first, that the total scale of the Japanese manufacturing investment is still relatively small and economically insignificant; second, that the typical establishment is a small standalone operation, marginal to the parent operation and weakly linked to the host economy; third, that their poor economic performance (measured by profitability, productivity, and stock turnover) provides an unlikely base for ‘best practice’ models in the host economy; and four, that the retention of high value-added activities in Japan and the high import content of the transplant operations limits host country employment to low-skill, poorly paid assembly jobs. Engineers are most clearly relevant to the second proposition (the marginal character of transplants) and the fourth proposition (the scope for higher skill and better rewarded jobs in the transplants). Although, when set in the context of the whole economy, the Japanese transplants appear small and responsible for little more than one percent of UK employment in manufacturing, their contribution to employment and economic performance in specific industries and regions is far from insignificant. Taking an industrial perspective, Japanese company investments in the UK have been particularly important in two industries, the colour television and motor car industries, and acted as significant catalysts in several others (Eltis and Fraser 1992). By 1987, 18 of the 32 Japanese plants making colour televisions and other consumer electronic products in the EC were based in the UK. In a similar way, the continuing weaknesses of the British volume car producers through the 1970s, paved the way for the direct entry of the three leading Japanese car producers, Nissan, Honda and Toyota. In both industries, Eltis and Fraser concluded that the Japanese companies have had a significant effect on the UK economy through the direct investment, through joint ventures, through the competitive examples, and through the development of the respective industrial infrastructures of component suppliers. Taking a regional perspective on the UK, Munday and his colleagues underlined the importance of the Japanese manufacturing investment in Wales and directly challenged the thesis of Williams and his colleagues (Munday et al 1992). From seven enterprises with 2,500 employees in 1980, the scale of investment has grown to 29 firms with 13,000 employees in 1991. By the early 1990s, the scale of employment ranged from an enterprise with only 15 employees to another with 2,500 employees. Much of the growth in employment has come, not from the addition of more companies and investments, but from the deepening investment of earlier arrivals. Only 11 of the 29 companies could be classed as assembly plants, mainly the recently arrived companies, while 9 of the 29 companies had local R&D units. Munday and his colleagues queried the interpretation of profitability, productivity and stock turnover data, and using measures of local plant autonomy, employment stability, and employment quality, they argued that the Japanese plants can be properly regarded as factories rather than simply warehouses. Pointing to the application of

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‘Japanese-style work organisation’ and to increased local sourcing, Munday and his colleagues emphasised the contribution of Japanese transplants to the Welsh regional economy. Yet these Cardiff-based researchers conceded that university graduate employment remains relatively low among the Japanese transplants in Wales (‘with 21 out of 25 transplants employing less than 25 graduates’), although they did not indicate what proportion of these graduates are engineers (Munday et al 1992:10). The debate between the two sets of researchers is as much an argument about methodology as a debate about substantive findings. Williams and his colleagues were wary of reliance on a few celebrated case studies of Japanese transplants and drew heavily on official statistics to give an ‘X-ray view of the firms’. Munday and his colleagues are sceptical about the interpretation of the statistics on profitability and argue that there is no substitute for direct surveys and visits to companies. Therefore, in the following sections, I will try to give a picture of engineers in transplants drawn from both the broad brush of a survey perspective and the finer detail from case studies. Transplants and the employment of engineers: a survey After a promising start, academic surveys of Japanese manufacturing companies in the UK have a relatively recent history and a relatively disappointing response rate. Kidd and Teramoto’s 1980 survey of the (then) 17 production subsidiaries in the UK yielded a 100 percent response rate, yet their 1990 survey yielded only 23 ‘usable responses’ (a response rate of only 23 percent). The researchers concluded that this was a ‘reasonable’ response rate with the targeting of Japanese production companies by many other researchers (Kidd 1994). Despite a modest improvement between their two surveys, the tendency for low response rates was experienced by Oliver and Wilkinson in their survey of Japanese manufacturing companies in the UK (Oliver & Wilkinson 1992). For example, they found only a 28 percent response rate in their 1987 survey of manufacturing companies, 14 firms from the 49 approached. However, there was a modest increase to a response rate of 34 percent for their 1991 survey, 53 completions from 155 manufacturing companies approached. The 1994 ‘Engineering Careers Survey’ was sent to 207 companies listed by the Department of Trade and Industry (DTI) as Japanese companies with manufacturing establishments in the UK and yielded 88 responses (42.5 percent) of which we have used 56 full responses (27.1 percent).2 The ‘partial response’ questionnaires (7.2 percent) were largely made up of those companies which were relatively recent arrivals and pointed to the absence of engineers (British or Japanese graduate engineers). Some respondents pointed out that ownership had changed or that manufacture had stopped. The ‘refusals’ (8.2 percent) were largely made up of older-established companies who felt that they were ‘overexposed’ to researchers. In addition to the questionnaire, a closer grained view of working relations between British and Japanese engineers was gained through interviews in six

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case-study companies—a television maker, a car assembler, a heavy engineering company, and three office equipment companies. This study echoed the International Research Group on R&D Management study (discussed in Chapters 4, 5 and 6) by adopting the pragmatic definition of an ‘engineer’ as a ‘graduate engineer or equivalent’ and accepting company definitions of equivalence from among the staff they classified as professional-level engineers. The Japanese expatriate engineering staff formed part of the core staff and their employment relations were conducted from the head office personnel department. In effect, there was a dual-track personnel management system for the Japanese and British staff. Typically, Japanese engineers had been recruited directly after graduation from university in Japan. During their stay of three to five years in the UK, they remained the direct responsibility of the parent company’s personnel department. In addition to these despatched engineers, there were some engineers assigned for short-term stays over a few weeks or months to oversee the introduction of new product models or the installation of new production processes. The recruitment of Japanese engineers already living or studying in the UK has been relatively rare. Not all of the companies had Japanese engineers assigned to them on a regular basis, particularly among the acquisition companies. Japanese engineers were found in 36 of the 56 responding companies. They tended to be located in small groups, with 31 of the companies employing between one and five engineers, and 19 companies having no Japanese engineers on regular assignment to them (see Table 7.3). Already, in looking at the employment patterns of Japanese engineers in Japanese companies, we can see considerable variety among the companies, from those with no engineers on a regular basis to those with a regular core who remain after the initial start-up phase of a greenfield site. While 14 companies employed no UK-recruited graduate-level engineers, 41 companies were responsible for the employment of 1129 UK graduate engineers. However, these engineers were spread in very uneven clusters, for 24 companies typically employed from one to five engineers while only seven companies employed groups of 20 or more engineers (see Table 7.4). Only one company, an acquisition rather than a ‘greenfield site’, had a concentration of over 50 engineers. The largest disciplinary concentration lay among the software engineers (465), followed by the electronic engineers (233), mechanical (86) and production engineers (63). The recruitment of British engineers was typically conducted through the occasional recruitment of limited numbers of experienced graduate engineers rather than large-scale regular recruitment from university campuses. Only 10 companies had added to their stock of engineering manpower during 1993. These companies were largely companies which had been established for at least two years in the UK. Only five companies were involved in the sponsorship of undergraduate engineers. Only two companies were involved in securing engineering manpower through contract engineers. Again, we can see great variation across the companies in numbers employed, disciplines recruited and employment policies and practices followed among

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Table 7.3 Plant size and number of Japanese graduate engineers

Source: Engineering Careers’ Survey

Table 7.4 Plant size and number of UK graduate engineers

Source: Engineering Careers’ Survey

engineers and these reflect the industries and modes of entry from greenfield sites to acquisitions. Although many of the survey companies are large multinationals, employing thousands of staff and hundreds of engineers in Japan, the relatively small scale of their operations in the UK makes their recruitment practices more like those of the medium-sized company. Among the case-study companies, the ratio of mid-career recruits to fresh graduates was 2:1 and over half of these engineers, as recognised by companies, gained their educational qualifications outside universities, usually at Higher National Diploma (HND) or Higher National Certificate (HNC) levels. These latter qualifications are awarded on courses with a less academic and a more practical orientation than university courses. Many of the engineers in our case-study companies had been attracted by the prospects of gaining experience of Japanese engineering management methods. However, companies conceded that their scope for attracting and retaining engineers with varied career paths was limited by the current size of their operations. Twelve of the survey companies had experienced some turnover of engineering manpower, but two thirds of them noted that this was typically only one or two engineers per company leaving mainly to join other manufacturing companies. Providing alternative definitions of success for engineers was seen as a key managerial challenge for management in transplants. As one training manager put it:

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Retention within a leaner, flatter organisation (is the most important management problem that the company faces in the mid-1990s in relation to engineering and technician manpower). The management challenge is to redefine success, status and personal achievement toward avenues other than hierarchical promotion. (Training Manager, Japanese transplant company) Those UK engineers who had had extensive one- or two-year assignments to Japan were particularly valuable losses. One company lost four out of the cohort of five engineers sent to Japan to learn about the new production technologies to be introduced from Japan. On their return to the UK, they were recruited by an American rival company opening up a new facility close to the Japanese company’s UK plant. Having organised expensive training and work experience, the company had failed to monitor the career progression of its UK staff. Chastened by the experience, the company introduced a new appraisal scheme (attempting to match career development with identifiable responsibilities) and a new higher pay scale. Together, these reforms appeared to help retain all of the second cohort of engineers assigned for training in Japan. For some companies, the apparent lack of longer-term career prospects in a relatively small plant has been offset by the growth of the scale of operations, and the progressive upgrading of the plant and the labour force. Responding to their own business plans and the encouragement of EC local content regulations, companies had added to their local manufacturing facilities and tried to increase the ‘local content’ of their production. The manpower implications of these developments can be traced in one of the semi-conductor manufacturing plants where, as total employment increased, the proportion of engineering manpower increased. For example, operations started in 1982 with 40 engineers (13.6 percent) out of a total labour force of 294 employees, but the engineering staff had risen more than proportionately to 199 (26.5 percent) of the 750 total employment by 1991. By this time, the ‘engineers’ were divided evenly between the half largely holding Higher National Diploma qualifications and largely employed in maintenance operations (often termed ‘technicians’ in other companies) and the half who were graduates holding a university degree or an equivalent qualification. The organisation of engineering work Having looked at the broad picture of the employment of engineers in a sample of transplant operations in the UK, we can now turn to some case studies to examine, firstly, the development of engineering functions at the level of the whole organisation in the transplants, that is, the cumulative additions of departments from sales to R&D, and secondly, the development of engineering roles, that is, the development of engineering activities at the level of the individual engineer.

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The development of engineering functions in transplant operations Japanese companies in the UK now have varied histories and exhibit a wide variety of policies and practices in engineering management. Acquisitions have enabled some medium-sized Japanese companies to start with a ready-made full range of manufacturing operations, while plants established by large companies on a ‘greenfield site’ may take years of patient investment to graft a fuller range of operations on to the initial stock of ‘assembly-only’. Thus, it has been argued that transplants will follow a natural history of developments from initial sales outposts, later supplemented by service and repair operations, until eventually fuller manufacturing operations are established with design and development following the initial start-up period of assembling imported knock-down kits. The JETRO annual surveys have attempted to capture some of these developments by surveying the extent of R&D unit growth, including both units ‘attached’ to a factory site and ‘stand-alone’ (or ‘independent’) units. The total number of Japanese R&D bases in the UK has risen from 24 in 1990 to 118 in 1996 (JETRO 1997). While some companies have located their R&D on a separate site from their UK manufacturing operations, hence the term ‘independent’, some of the ‘independent’ units represent investments by companies without any manufacturing in the UK. In this sense, they are a novel phenomenon and show a different path to R&D than the ‘natural history’ view. ‘Independent’ refers only to a separate location from manufacturing and carries no implication of financial and budgetary autonomy. In fact, 75 percent of the R&D units were owned by the parent company in Japan in 1994 and show that there has been relatively little localisation of ownership in R&D activities (Hasegawa 1998:53). In this section, I will draw on four of the case studies to demonstrate how companies have been cautiously building up their operations in both scale and complexity. These case studies of a television maker (Terebi), a car assembler (Kuruma), a heavy engineering company (Jukogyo), and an office equipment company (Denki) reflect important sectors and illustrate significant themes in other sectors too. The TV makers Companies manufacturing electronics products from business equipment to consumer products such as colour-television (CTV) makers form one of the biggest segments of Japanese inward investments to the UK. CTV production is hailed as one of the success stories in regenerating an ailing industry and ailing regions through Japanese direct investment (Eltis and Fraser 1992:6– 8). The electrical and electronics industries have been a major source of Japanese comparative advantage in international trade. The European adoption of the PAL transmission technology (pace the French adoption of the SECAM system) gave some temporary shelter for UK CTV-makers’ imports. Fears about the

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rapidly increasing import penetration of the UK market by Japanese CTV manufacturers led to a ‘voluntary agreement’ between the British and Japanese manufacturers’ associations, limiting Japanese imports to 10 percent of the UK market. Therefore, Sony (1974) and Matsushita (1976) set up manufacturing facilities in the UK to produce the large-screen models excluded by the agreement. However, Hitachi’s plans for CTV manufacture in the UK provoked fierce opposition from UK producers and trade unions. The National Economic Development Office (NEDO) responded with a plan to restructure the UK CTV industry around existing manufacturers, but encouraged the queuing Japanese entrants either to enter joint ventures with the European companies or to take over their unwanted plants (Ughanwa and Baker 1989:21–31; Strange 1993:196–9). The distribution and character of the later Japanese CTV entrants reflects this rather curious history. Only Sony and Matsushita were able to start from ‘greenfield sites’ in south Wales (that is, from the popular image of a new site with new plant and equipment, a new labour force and new patterns of work organisation and management). Of the other CTV makers, Hitachi formed a joint venture with GEC (Hirwaun in south Wales in 1978); Toshiba entered a joint venture with Rank (Plymouth in 1978); Mitsubishi took over the Norwegian Tandberg company plant (Haddington, east of Edinburgh in 1978); and Sanyo took over the Pye factory (Lowestoft in 1978). However, the joint ventures foundered on the lack of UK partner expertise and managerial conflicts. Then the Japanese partners were left to develop wholly owned sites as the British partners pulled out. Thus, there were two ‘greenfield sites’ and the remainder are more properly called ‘reconstituted sites’. A pragmatic and incrementalist approach to the development of transplant engineering functions can be illustrated through a case study of one of these TV makers, the Terebi company. Through the 1970s, Terebi set up overseas manufacturing operations in non-Japanese Asia, largely for access to lower labour market costs, and the US and the UK, largely to secure product market access. Company managers conceive of these overseas moves as part of a threestage development from ‘the international company’ (where overseas sales operations were established) to ‘the transnational company’ (where overseas manufacturing activities were developed), and eventually to ‘the global company’ (where the co-ordination of products and processes across national boundaries will be much more closely integrated). Currently, operations are judged to be at the transnational stage. Although the US is a very large market and both the US and non-Japanese Asian facilities were established before the 1979 UK activities, the UK plant had emerged as the company’s most advanced overseas manufacturing facility. It included the full range of operations of CTV (colour television) assembly, from the auto insertion of small components to the manual insertion of large components as the chassis is built, and later combined with the CRT (cathode ray tube) and cabinet as the line moved towards final assembly. Moreover, the UK plant added design and applications engineering to broaden the range of

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engineering functions. Two factors underlay contrasts between the company’s US plant operations and the other locations outside Japan. First, the US and non-Japanese Asia wage differential made production of components in Asia and assembly only in the US more attractive. Secondly, the European local component requirements encouraged attention to manufacture in the European Union. In terms of Figure 7.2, the US plant concentrated on the ‘back end’ only of CTV assembly whereas the UK plant undertook both the fuller manufacturing involved in both ‘front end’ and ‘back end’ activities. The complexity of ‘front end’ operations meant that the UK plant needed much more engineering activity, and hence more engineers, in the production area. However, technological changes have been eroding the differentials over time. In 1979, the ratio of total manufacturing staff in ‘front end’ to ‘back end’ operations was 2:1. However, the progressive introduction of more autoinsertion of components, for example 80 percent of components are now autoinserted, has brought the ratio nearer to 1:1 in the 1990s. The propensity of consumers to regard the CTV as an item of living-room furniture and evident variations in national furniture tastes and styles is one factor prompting the desire to set up design and development units close to the overseas manufacturing plants. Yet when the Terebi company wanted to add applications engineering to its small UK plant in 1981, there was a lack of interest in advertised posts. After consultation with the company President, the incentive of one or two years’ study in Japan was added to advertisements and 20 applicants sought the two posts. Since then, a stream of engineers has made the trip to Japan, at the rate one per year, and a capacity for applications engineering has been developed. Now the UK engineers can take basic ideas from the Japanese design centre and develop applications for the complex and highly differentiated European market. In 1994, the design activity for Europe was reorganised into a UK-based group and a Japan-based group under a Japanese manager based in the UK. While the two groups were of similar size,

Figure 7.2 Colour television manufacturing processes Source: Terebi Television Company

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the UK-based team was largely made up of British engineers supplemented by only a few Japanese engineers. Over the 15 years from its establishment, the range of engineering functions has been extended in the UK plant so that gradually more responsibility has been taken there. Basic research in CTV is unlikely to be established in the UK, for it seems set to remain concentrated in the central research laboratories in Japan. However, more longer-term research in multimedia is a possibility for the UK. Nor is it likely that video-tape recorder (VTR) manufacture will foster local engineering competencies to the same degree since the VTR is seen as a product for a less differentiated international market and it can be serviced more readily from Japan than the CTV. The implications for engineering recruitment from the addition of more engineering functions can be traced in Figure 7.3 and the career paths in the Terebi plant. With the focus on production, the company relied on operators, technicians and the Japanese engineers. Technicians could be recruited as mid-career recruits with (sub-degree) HNC/OND qualifications or from college at E, or taken on as a technical apprentice at C.3 Over the longer run, the company could make internal promotions from operators (recruited at C) or the assembly line ‘troubleshooters’ (recruited at B). However, when the company wanted to establish the design and development functions, they wanted to develop the engineering/ technical career path with graduate engineers recruited at F. While Britain had a relatively low age-participation rate in higher education, there were able school-leavers who could make their way through employment and part-time study to reach engineering management, as one engineering manager explained: I suppose I have come a long way from ‘TV repair man’ to ‘Engineering Manager’. I did a five-year apprenticeship which I regret now. I should have gone to college or university full-time, but few did in my community. If I were starting again now, I probably would go to university. When I was working in TV repair, I saw jobs advertised here (at Terebi) in inspection. I have moved through ‘incoming inspection’ (two years) to ‘development’ (two years), then into the ‘automatic test department’ (two years) and finally into ‘production engineering management’ (two years). (Engineering Manager—Terebi Company) Although Terebi has been satisfied with the quality of university graduate engineers recruited, they have been disappointed by the small pool of applicants. To some extent this has reflected the history of plant location (where the Japanese TV makers were encouraged to take over the plants of failing European TV makers in the UK, typically in depressed regions with high unemployment, rather than being given a free hand to establish ‘greenfield sites’ in new locations). However, recruitment problems have also reflected the image of analogue electronics as a poor cousin of digital electronics among aspiring engineers. Here technological change, and the development of multimedia products, is bringing some cheer for the personnel department as the increasing

Engineering transplants

Figure 7.3 Career paths in Terebi TV Company 1 ⇑ Denotes entry to the structure. Source: Terebi Television Company

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importance of digital electronics skills adds new dimensions and more positive images for the CTV manufacturer. The net effect of these technological changes is an anticipated upturn among engineer applicants and an amelioration of some of the engineering recruitment labour market problems for the CTV companies. While the Japanese companies as a group transformed the British TV industry, business success has not been evenly shared among them. Europe in the 1990s has not yet lived up to all the heady hopes of prosperity which appeared as the plans were pressed for the completion of the single market, and the Japanese companies were pressed to manufacture on the inside. In 1998, Mitsubishi Electric announced the closure of its Haddington plant, prompting union criticism that they were moving in search of lower labour costs on the European periphery. The car assemblers The auto industry illustrates very well the interaction of those supply-anddemand factors which brought about the growth of Japanese auto assembly transplants in the UK. On the one hand, by the 1980s, Japanese manufacturers were seeking to manufacture overseas in order to get round real or anticipated trade barriers, while many foreign governments were building hopes on auto industry restructuring as a potential source of inward investment to promote industrial regeneration in declining industrial areas. As a major industry requiring large capital investment and carrying dynamic spillover effects into the automotive component suppliers, an investment for car assembly looked an attractive proposition for local and central governments. Japanese car assembly looked even more attractive. The prospect of dense networks of suppliers clustered round the assembly plant were stimulated by the images of tight spatial location for suppliers around Toyota City, the reliance of Japanese assemblers on a greater degree of out-sourcing for components, and the prospects of host companies joining the ranks of suppliers. The Thatcher government after 1979 was particularly attracted to the idea of inward investment bringing ‘best practice’ manufacturing. The British government’s attitude stood in contrast to that adopted in several other European capitals since the European car industry had been marked by segmented markets, often dominated by ‘national champions’. Britain became a ‘bridgehead into Europe’ for the Japanese manufacturers baulked by restricted access to European markets. Honda, the first entrant, came via a joint venture and crossshareholding with British Leyland (later Rover) in 1979. Nissan and Toyota followed later in the 1980s on to wholly owned ‘greenfield sites’. The order in which these companies arrived in the UK reflected their shares in the Japanese domestic market and relative dependence on exports. Honda, with a smaller share of the Japanese market, came first, followed by the number two Japanese producer (Nissan), while the market leader in Japan (Toyota) came third. Honda, which had added a greenfield site to support its joint venture, was taken aback

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by the British government’s readiness to approve the sale of Rover by British Aerospace to the German automaker, BMW. Britain’s retention and revival of an auto industry has owed much to the arrival of the Japanese car transplants, partly through their direct contributions and partly through their stimulus to the other UK-based producers (GM, Ford and Peugeot) and the component industry. Eltis and Fraser observed that the British car industry had largely been written off by financial journalists and others at the start of the 1980s (Eltis and Fraser 1992:8). Efforts to prop up a national champion through the mergers leading to British Leyland had failed to create a viable volume producer and the UK-based multinationals (GM, Ford and Peugeot) were tending to see the UK as increasingly an assembler with top ups from their other mainland European plants: ‘…from 1972 to 1982, United Kingdom production of passenger cars dropped by 54 percent and a small trade surplus became a deficit of £2 billion’ (Eltis and Fraser 1992:8). The future growth of the Japanese transplant operations is uncertain. The 1991 accord reached between the European Commission and the Japanese auto industry deferred full opening of the EU car market to Japanese imports until after 1999 and quotas were roughly set in line with existing market shares. However, the transplants were explicitly excluded from the accord, which means that any increased market share must come via the transplant activities, with obvious benefits for the British balance of trade and payments. The European Commission’s local-content rules have had a significant impact on the development of assembler-supplier relations in Europe. Nissan established ‘synchronous production’ (an ambitious form of ‘just-in-time’ production), and invited other suppliers (including Japanese suppliers) to join them in the north-east region. While the vast bulk of operator-level employees have been recruited from the local region, recruitment of managerial and professional level staff has been conducted at national level. Thus Japanese auto companies recruited engineers from the established auto assemblers in the UK, particularly Ford and British Leyland (Rover), or companies linked to the auto industry as suppliers of materials such as steel or paint. Although industrial experience of auto-assembly and auto-supplier companies was valuable, UK engineers found that they had to adapt to different patterns of work organisation and take on new responsibilities. At the Kuruma auto assembly plant, one of the three Japanese auto assembly plants, Japanese technical staff had been heavily engaged at several levels of the technical hierarchy from manager to group leader in the early years of the plant’s life. After three years, however, most of the Japanese group leaders had returned to Japan. Japanese engineers were mostly found occupying advisory roles, either shadowing a British manager or acting as an intermediary in the structure. The British engineers encountered in interviews were drawn from the assembly and quality assurance areas. Since a new model was in production, working hours were long with six to 17 hours of overtime worked, although at ‘senior engineer’ level there was no overtime pay. All the British had extensive

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experience in British car-assembly plants or auto-industry supplier companies. Nevertheless, the British engineers saw themselves in a learning role in Kuruma in relation to the products, to the different production philosophies and methods and to their Japanese supervisors. For example, quality assurance responsibilities were organised to give broader responsibilities to the quality assurance engineer as a British quality assurance engineer explained: I get much more variety at Kuruma than at [my British car company] because I am given much more responsibility, both in the way the work is organised and in the way that instructions are given. At [the British company] supplier quality work was part of purchasing and plant quality, internal quality was part of manufacturing quality and a division of process engineering. It meant that when we had a problem to solve on a vehicle, it wasn’t clear whose responsibility it was. Here, we have total responsibility for an area of the vehicle, for example total responsibility for the front end —responsibility for supplier and in-plant quality systems and problem solving. It’s quite clear who is responsible because of the organisation. Your expertise in an area becomes far higher. (British senior QA engineer, Kuruma car company) In addition to the structure of work organisation, the supervisory style was aimed to encourage initiative and a sense of responsibility by giving scope to the individual engineer to develop their own approach and to expand the task. At [my British company], the senior would give you a lot of detailed instructions—what to do—that’s the British way. But it takes all the initiative —you can’t contribute, you can’t learn. Here [at Kuruma], a good performer is someone who does all that’s needed to achieve the target—the report. If you do that you are a good performer. The Japanese way is to give you a goal. If you’ve got time and you’ve achieved your goal, you can use your own initiative. If you give all the detail, you’ve failed. My supervisor calls it genchi kenbutsu—go, see and make an on-thespot investigation. (British QA engineer, Kuruma car company) This supervisory style was interpreted by another British engineer with a different Japanese supervisor in the quality assurance department as an aspect of the Japanese ‘bottom-up’ management philosophy. In similar fashion, he confirmed the importance of clear direction on target tasks and ample scope for initiative and the development of engineering skills. Again, he contrasted the approach in Kuruma with his previous experience in a British materials company: They never tell me what to do. It’s left to me to think how to do it. If I report on the status of a problem on metallic paint, he will ask why and

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give me an idea to follow. It’s very rare for him to say this is how to solve it. He’ll say have you done this. It’s done indirectly. I try to follow the same approach with other people. It’s a big change because at [my materials company] managers told you what to do. I much prefer to do it the ‘bottom up’ way. It’s daunting at the start. It can be very frustrating. There’s a lot to learn. But if we are told what to do we stay at the same level—we’ll never learn. (British materials engineer, Kuruma car company) These engineers valued the scope for learning and skill development which came through different patterns of work organisation and supervisory styles. However, they noted that career opportunities in the relatively small-volume production of current transplant operations offered fewer career opportunities within the company than the much larger British operations which they had left. The heavy engineering company The Jukogyo manufacturing company is a multinational company with a worldwide reputation for its products. Its origins can be traced back into the Meiji era and the establishment of a manufacturing factory to manufacture mining equipment and machine tools for its parent company. In World War II the firm supplied the navy with heavy equipment and munitions. In the post-war period, it received a boost from the Korean War orders of the US for a range of military vehicles. In the 1980s, it developed production and sales plants in the United States, Canada, the United Kingdom, Mexico and Indonesia, and joint ventures in a number of other countries. The company has earned international recognition and prestigious accolades for its manufacturing—for example, the company was awarded the Deming Prize for quality control. Production was transferred to the UK when the EC began to impose heavy duties on the company’s imported goods. The company earned a good deal of local goodwill when it moved into a relatively depressed region and declared its commitment to both the long-term investment and strenuous efforts to recruit among unemployed people. The early optimism was bolstered by the heavy symbolism attached to the company’s move into the factory space vacated by an American heavy-equipment maker which had closed down its UK manufacturing operation. The transfer of design and development came later with the recognition that the German market, with its more stringent environmental sensitivities and regulatory regimes, required equipment that was only a minor slice of production in Japan. Therefore the company decided that it needed local design input with a closer appreciation of both the European product market and production using local suppliers. Recognising the value of UK engineers who could readily cross engineering cultures, the company recruited a group of newly graduated UK engineers for despatch to Japan to experience directly company design and manufacturing processes. Yet the scheme came unstuck when the majority of the recruits left the company after returning to the UK, as

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it was found that these highly trained engineers returned to the UK as ‘marginal men’. Their only experience of factory work was in Japan since they had had no prior experience of UK design or factory work. Frustrated in work but highly market-able, most of the cohort moved on to other companies. In the revised scheme, the company has been more accommodating to mid-career recruits and now sends the UK engineers to Japan only after a period of employment (and probation) in the UK. This new scheme appears to work well, producing ‘technological gatekeepers’ who are familiar with the design process in Japan, can bring new models to the UK, and can advise Japanese designers of UK manufacturing conditions. With 10 percent of its workforce engaged in design and development (D&D), the company has proudly announced both the successful transfer of development projects from Japan and the development of a new model wholly designed in the UK. One major setback to the process of localisation occurred with the move of the British head of D&D to a UK engineering company. It took a further two years to recover the localisation policy through the internal promotion of a British engineer. During the interregnum, the Japanese departmental adviser had held the manager position and delayed his return to Japan by two years. After much internal debate, the company has concluded that such losses are an inevitable feature of UK labour markets, although they hope that astute human resource management might mitigate their future losses. The company has also had to come to terms with more depressed markets and the problems of redundancies as the German economy moved into recession after the reunification boom. The office equipment companies The three parent office equipment companies represented different generations of a Japanese company with foundations in the Meiji era, inter-war and postwar era respectively. Yet all three office equipment plants were established in the UK in the late 1980s in response to European Commission moves to impose anti-dumping duties of 17 to 35 percent on several products after complaints and proceedings launched by European manufacturers (Strange 1993). This context put a lot of pressures on the companies to ramp up their operations very quickly. Given that they had proven products, existing designs and components from Japan, the main concern was staff recruitment. However, the EC subsequently moved against ‘screwdriver operations’, those operations that were largely assembling kit operations, and the companies were obliged to build relations with local suppliers, although some of the local suppliers turned out to be Japanese companies invited to establish manufacturing plants in Europe. At the Denki office equipment company, two kinds of problems emerged in the early years. At the operator level, they found that company insistence on the recruitment of young workers brought problems of industrial discipline and high turnover rates. In addition to familiar problems in recruiting a young female labour force who might leave on marriage and family-building, there

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were problems which came from the ability to cream the higher ability levels among school-leavers who could leave easily for other employment despite relatively high levels of unemployment. The company then extended the age range for recruitment to try to reduce operator turnover below 16 percent per annum. The technical base of the company—the engineers, the purchasing and materials staff—were recruited from a half dozen other major companies in the region. Similarly, managers came from a variety of companies and posed some problems in absorption and cohesion since some had trained in British companies, and others in American or other European companies. They had to train together to work as a group, to understand their business and to understand the character of the Japanese company. Some of these problems were seen as closely linked to differences in methods of working among British compared to Japanese engineers. As the personnel director explained: At the initial phase, there was a great deal of excitement and motivation about new products, new cultures, new faces. But then we gradually ran into problems—some of understanding, some of structure, some were about the way that engineers relate to production in Japan compared to the way British engineers relate to production. In the UK engineers become engineers by becoming graduates. Then the engineer becomes a senior engineer. At that stage they forget what they learned as an engineer. They get their own office. But in a Japanese company like Denki there is more of a continuum. Engineering is much more of a hands-on approach than either in a British or American company. It caused many shocks, many arguments after the honeymoon period. (Personnel Director, Denki equipment company) Three years later, the production engineering group, intended to liaise with company plants in Japan, became the base for establishing a design and development department. Where the priority for rapid entry to production prompted the midcareer recruitment of experienced engineers in production, the priority for design and development was the recruitment of recently graduated engineers who could be socialised under the tutelage of the Japanese director of engineering and two engineering colleagues from Japan. When I first came I had a surprise. The person who went to Japan, to learn the technology, left. But we need continuity for engineering and freshmen from university in the industrial field. The basic knowledge and design is more complex, they need on-the-job training to learn. We are not looking for experienced engineers. They would always compare things to their previous company on pay, conditions, ways of working, and so on. We want them to learn Japanese-style, the need to be more flexible about technology, knowledge and approach. (Japanese Design and Development Manager, Denki equipment company)

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Senior engineers from Japan were expected to groom the young British engineers to cope with differences in approach between British and Japanese engineers. For example, the engineering director drew attention to differences in report presentation: For example, when I say I want a report, the British engineer will produce a four- or five-page report. British engineers are less trained in visual approaches. All I really want is one sheet, a diagram and a short sentence or a flow chart. (Japanese Engineering Director, Denki equipment company) Given that the main product lines in office equipment were established technologies with little scope for original design or development, the company had introduced some development work from another product division in Japan for the automotive industry, partly to expand into the UK’s resurgent auto industry and partly to offer some greater scope for challenging work for the design and development department. All of the case-study companies were large corporations in Japan. Each of the UK plants was wholly owned by the Japanese parent company and employed several hundred people in the UK and were above the average size of Japanese transplants in the UK. Four of the six plants were ‘greenfield sites’ in the sense of new sites, new labour forces and new working methods. The two other sites were ‘greenfield sites’ in all significant respects. The only exception was that the sites and buildings had had previous owners who had vacated the sites, but they had left some years before the Japanese acquisitions of the sites. Therefore each company had considerable scope to introduce new methods to their new labour forces. They can be contrasted with the acquired companies which often retained their British identity and which were left with considerable autonomy. For example, one of the computer company acquisitions defined itself as a British company with joint ventures rather than a Japanese company: ‘we do not perceive ourselves as a Japanese company—We have Japanese shareholders, we have some joint activities but we are not managed by Japanese managers.’ In another electronics acquisition in the south-east of England, something of the joint character of the new identity was reflected in the adoption of a doublebarrelled Japanese-English name. The Japanese company had been a customer and noted that the English company was in the hands of a holding company and being readied for sale. The main concern of the new owners was mainly to stabilise the future for its acquisition by building its market through its own contacts. The two Japanese staff, including an engineer, were assigned to the British plant in an advisory role. Thus it is clear that there are a variety of company relations between parent and UK plant and a variety of interpretations of roles within plants.

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Developing engineering roles in transplant operations There have been broad differences in the extent to which Japanese engineers were called upon to introduce new methods in the ‘greenfield sites’ compared to the acquired companies. In some of the celebrated case studies the distinctions are blurred because the new operation was acquired after the dramatic collapse of a joint venture and the need to mark out a new beginning and new order for a new beginning, rather in the manner of a ‘greenfield site’ (Bassett 1986). Both of the TV plants run by Hitachi in South Wales and Toshiba in Devon followed this pattern, and might be more properly termed (following David Guest 1987) ‘reconstituted plants’. Four of our case-study plants were ‘greenfield sites’ and two were ‘reconstituted sites’. For the most part, acquisitions have been less dramatic and the Japanese head office has seen its role as to advise, guide and assist rather than directly intervening in the acquired plant. We can look further into the problems of technology transfer by examining how companies develop and fill ‘gatekeeper roles’, that is, engineers who can facilitate the flow of technological information between the parent company and its overseas plant. For these roles, the companies need to recruit both Japanese and British engineers. Japanese engineers will be more critical in the early phases of introducing manufacturing activities. For many companies, the much-criticised ‘screwdriver plants’ were an inevitable demonstration phase as Japanese engineers trained local staff in the assembly of knock-down kit parts. As the companies try to add R&D or D&D competencies in Europe, the recruitment of British engineers becomes more important and their ability to liaise with Japanese units becomes more critical. In earlier chapters, we have seen that studies of the recruitment, training and deployment of engineers in Britain and Japan in large companies have revealed significantly different approaches in the two countries (Chapters 3, 5 and 6). • Differences in recruitment were associated with the division of labour between universities and companies in education and training. • The company training system with its in-house and on-the-job training has encouraged a preoccupation with company-specific knowledge and skills and hence on making company engineers. • The lifetime employment system had a significant influence on pay and promotion systems in the large Japanese corporation, with more companymanaged career paths and strong weights attached to seniority in the pay and promotion system. • We saw that the two above factors were linked in their implications for the induction of Japanese engineers into dense ‘engineering networks’. Therefore, Japanese engineers who come as expatriate engineers to the British plants of their employer are products of a different system with different orientations, expectations and experiences from those generated among the British engineers with whom they work. British engineers, without direct

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experience, stand on the outside of these company networks. These differences provide some of the potential for either mismatch or fruitful complementary collaboration. The Japanese engineers despatched by the large companies to the establishment of their plants in the UK in the 1980s were part of the companies’ elite cadre of engineers. We saw (Chapters 2 and 3) that these engineering graduates had been recruited from elite universities and their careers managed by the company personnel departments. Very favourable impressions of the Japanese expatriate engineers were noted by the British personnel departments who were invited to compare their British engineers to the Japanese staff (Table 7.5). A similar comparative profile was evident in the British engineer responses to the same question put in our interviews in the six casestudy companies. In his mapping of dimensions of cultural differences, Hofstede drew attention to the greater propensity of the Japanese to stress ‘uncertainty avoidance’, whereas the British were quite tolerant of uncertain and ambiguous situations (Hofstede 1994:139–58). These cultural traits had echoes in the comments of British engineers who felt that their Japanese counterparts were more limited in novel situations. The Japanese engineers are very good at retaining knowledge. They are not so good in new situations. The British engineers are much better with new problems; they are quicker at learning. The UK engineers are largely satisfied if they have got 90 percent of a problem right. The Japanese go for 100 percent, but it’s not necessary to get that 10 percent for the effort involved. (British mechanical engineer, Jukogyo company)

Table 7.5 UK engineers compared to expatriate Japanese engineers

Source: Engineering Careers’ Survey Note: Respondents were invited to rate their UK engineers against the Japanese engineers working in their company in the UK on a scale from 5 (much better) to 1 (much worse).

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Authority and autonomy Japanese organisations are both strongly hierarchical and participative (Lincoln and Kalleberg 1990:235–47). Resolving this apparent paradox is one of the central tasks of managers. On one hand, elaborate hierarchies are highly visible in company uniforms, badges, age-grading and so on, and they are highly formalised with extensive procedures. On the other hand, companies have the wide range of measures to promote participation from institutionalised small group activities, such as quality control (QC) circles on the shop floor or ‘ability development’ groups in offices, to the relatively informal preparatory stages of decision-making, such as nemawashi or ‘binding the roots’, and the more formal consultation procedures of decision-making, such as ringi-seido (a group-oriented, bottom-up consensus-seeking procedure by the circulation of documents among middle managers requiring signed approvals). Japanese managers, deeply socialised in occupying positions in formal hierarchies and eliciting commitment from their subordinates, find considerable difficulty in coming to terms with the local staff in the transplants (Smith and Misumi 1989). Japanese expatriate engineers can occupy several different statuses from line manager to adviser and the advisory roles can be long term (from three to five years) or short term (from weeks to months) as particular technologies in products or processes are transferred. Japanese staff as managers were usually at very senior levels in the plant and it was usually added that this was a temporary position prior to the development of local managers. Some managers find the sharper boundaries drawn between work and non-work spheres of life in the UK disconcerting—for example, a Japanese engineering manager was taken aback when his design team declined to yield their home telephone numbers to his secretary, even though they could have been readily found in a telephone book. Technological upgrading and the later addition of an R&D unit to a manufacturing plant can mean that the Japanese R&D unit manager faces a struggle to establish his department’s standing within the transplant organisation after leaving the relative comfort and security of a stable hierarchy in the parent company. Engineering came late into this plant. A lot of relations between departments were already established before I came to set up the design function. In (the parent company) you can see the engineers by their blue badge. Indirects are grey, operators in assembly are yellow, and administration are green. You can tell the freshmen by their circular badges, but in the second year they are oval. The engineers are responsible for the drawings and the engineering drawing is a most powerful tool, giving great status to engineers. However, when this plant was largely assembly other groups had more power. We have to try make our way into this situation. (Japanese engineering director, Denki equipment company)

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More common were the ‘shadow roles’, known by various terms in the different companies—for example, ‘adviser’ or ‘co-ordinator’. It is a role which was seen as particularly problematic by the Japanese engineers, who spoke of their lack of authority and contrasted their role with the more familiar positions which they held in Japan. But there were some qualifications to these simple and starkly drawn contrasts. For example, some advisers noted that the scope of their work in the UK was much broader and it did not involve them in the complexities of consultation across factions and departments inside a Japanese plant. Although advisory roles might not carry much overt authority, age and experience tended to lend support to their position. On the relatively youthful ‘greenfield site’, Japanese advisers tended to be older than the British engineers with whom they worked. However, this situation is changing over time on the longer established plants. Where it was once unknown for a Japanese engineer to report to a British engineer, such relations are now emerging. Similarly, Japanese engineers were highly respected for their product knowledge as long service with their sole employer has give them an unrivalled knowledge of company products and processes (see line c, Table 7.4). However, as the British plants develop over time, British engineers are developing a greater sense of the product histories. British engineers tended to accept that they were in a junior role in learning from their Japanese counterparts. However, some British engineers found an irksome lack of authority with their assumed responsibilities. For example, in some plants, fax messages to Japan had to be checked by a Japanese adviser or manager and could be altered without reference back, even though they carried the original signature. Again, the pattern of double-checking associated with the search for consensus management was sometimes found to be time-consuming and frustrating. However, in some cases, these same engineers would concede that their earlier British employers might have remained in business had they followed similar scrupulous procedures in confirming communications. Roles and responsibilities All of the Japanese managers commented on the narrower definition of roles and responsibilities which they found among the UK staff compared to what they would find in their companies’ plants in Japan. This apparent narrowness of job definitions in Britain compared to those Japan echoed the earlier contrasts on authority among Japanese engineers. In Japan, the broader definition of roles facilitated overlapping responsibilities and a Japanese engineer saw the pitfalls of narrower British roles in design offices where problems in products and components could arise because of gaps in design responsibilities and poorly integrated design: We can have some communication problems. Among British engineers job definitions are narrow. They tend to say it’s not my job. If we are thinking

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about pins, pipes or brackets, we can have a gap in design in the UK. In Japan, responsibilities are more vague and overlap. Of course, both can cause problems—but they are different types of problem. (Japanese design manager, Jukogyo company) These comments need to be interpreted with care since Japanese engineers in the UK tended to have a much broader remit and sense of responsibility than they carried in Japan. For example, the Japanese engineers in production were associated with the development of all aspects of manufacturing and building the relationships with approved supplier companies. For the Japanese advisory staff concerned with design, their involvement in the role of translating designs from Japan rather than in carrying out original design work in Japan meant less challenging (and hence less interesting) work and carried some career risks. However, a design engineer was quite sanguine about the unfolding pattern of career opportunities with the commitment of companies to globalisation strategies: I didn’t learn much on the technical side in the UK. I learned something about acceptable standards. But I learned a lot about management in a different culture. We have created a design centre now in the UK, so if I went now perhaps I could continue to learn more about design. But if you want to build a career to be number one in design, we have so many design centres in Japan. There should be a maximum length overseas for a designer because you begin to lose your touch. But I learned a lot about building good relations with vendors. That’s very useful because we are going to have more global operations. (Japanese design manager, Jukogyo company) For the Japanese engineers and managers, what is happening in the Japanese plants and head office is a constant reference point, not only for their work in the UK but also for their eventual return to Japan (Hamada 1992). However, engineers had an extra strand of communication in the enterprise union compared to the managers since engineers were still union members, and in some companies the unions took their responsibilities for overseas members quite seriously and made direct contact and efforts to keep members updated. Training and skill formation Just as the survey revealed a variety of employment and training contexts for the engineering staff in Japanese companies in the UK, so there are a variety of training contexts in which learning occurs. The case studies were drawn from companies which had significant numbers of British and Japanese engineers and tended to be in the larger plants in terms of capital and labour employed. Among these case-study companies, the main medium of skill formation for the UK engineers is on-the-job training through

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structured experience under the guidance of supervisors, often those in adviser or co-ordinator roles. Visits to Japan or other overseas plants provided another source of intensive learning. Visits to car plants in the US eased language problems and offered a work context and problems closer to those of the UK transplant than those in the ‘mother plant’. For example, a Kuruma quality assurance engineer saw more relevance for the British transplant in the American assembly plant’s inspection of supplier components compared to the confidence exhibited towards long-term suppliers in Japan: In Japan, I had a month and did a lot of technical training. Quite a lot of things I had done at university so it was like revision. A lot of things were related to problems of Kuruma in Japan. I had a week in [the US] plant. That was very similar to what we do here and things didn’t lose in translation. Here we test every coil that comes in from the suppliers. In Japan, they don’t test coils. So we couldn’t learn about that in Japan. In [the US plant] they are still testing coils. (British design engineer, Jukogyo company) Among engineers, off-the-job courses had a rather limited role in training. Some engineers commented that the menu of courses were broadly directed to all staff (for example, courses on problem-solving or assertiveness training) and that technical courses were rather limited. Communications and gatekeepers At the more interpersonal level, some of the mutual irritations and frustrations of American and Japanese engineers working in joint ventures in the United States have been traced to cultural factors (Lynn 1992). American engineers entered the relationships with popular images of Japanese engineers and their organisations as efficient and became puzzled and irritated when Japanese engineers repeatedly asked for information which appeared to be irrelevant information. Ultimately, some American engineers concluded that ‘the efficiency of Japanese engineers’ had been largely mythology. On their side, Japanese engineers were frustrated by apparent American unwillingness to help. Lynn set these reactions in the areas of communication and decision-making in their respective cultural contexts (Lynn 1992). For example, Japanese engineers emerged from a ‘high context culture’ where the external environment, situation and non-verbal behaviour are crucial in creating and interpreting communications, and the practice of life-time employment reinforced the richness of interpretative cues in company communication. However, these Japanese engineers were faced by American engineers from a ‘low context culture’, with the opposite characteristics, who did not appreciate the desperation with which the Japanese engineers were seeking further information as cues to interpret communications and relationships. Lynn suggested that more sensitive cultural training would clarify expectations about communication

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and decision-making. In a study of an Anglo-Japanese technology partnership, Lam put more weight on structural rather than cultural factors, demonstrating how differences in British and Japanese management systems and work practices in product development, communication and co-ordination, and skill formation undermined the adaptive strategies of the two companies and their efforts to form integrated work teams (Lam 1995). In product development, the Japanese partner practised a more integrated approach compared to the more sequential approach of the British partner. Communication and coordination rested more on the human network developed among long-serving employees whereas the British partner relied more heavily on formal written documentation. Finally, Lam emphasised the different national patterns of skill formation and labour market structures from which the two partners drew their engineers. If Japanese companies work hard at communications in Japan, they must work doubly hard at them in their transplant operations. Different national languages add a further complexity to the technological translation process. However, a head office personnel manager responsible for overseas assignments in Jukogyo, the heavy equipment company, noted that views about personal qualities necessary for a successful overseas assignment had been changing, with most weight now attached to cross-cultural skills: We think that the most important elements are: first, character; second, high skills; third, language. We used to think that language was first, but now we stress character. We mean having an open mind, someone who can accept dealing with other people. Someone who doesn’t lose confidence overseas. (Japanese personnel manager, Jukogyo company) While ‘openness’ in cross-cultural communication might be seen in head office as the main priority, language issues remain important sources of difficulty between some Japanese and British engineers. Some British engineers develop their personal strategies to ease communication—for example, by relying heavily on written communication: ‘I prefer to write things down and that gives Japanese engineers time to mull it over. Telephones calls can be a nightmare with Japanese engineers’ (British design engineer, Terebi). While the transplantation of proven production technologies and work organisation from one environment to another is complex in itself, attempts to add an indigenous creative facility to the transplant adds further levels of complexity. A great deal of effort has to be put into the creation of ‘gatekeeper roles’, people who monitor and facilitate information flows. Programmes for the development of ‘gatekeepers’ among engineers recruited in Britain involve longer assignments in Japan, typically one or two years and include language programmes. Two aspects often mentioned by the British engineers were: first, the importance of understanding design histories in the parent company and making contacts with company networks of engineers;

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and second, the importance of the process of adapting design for a UK context, particularly to the different working relations with suppliers. British engineers referred to puzzles and problems which they had with company designs in the UK plant. Often they and their colleagues would wonder why the Japanese engineers had not taken another solution. As one engineer put it, on arrival in the company’s R&D centre he learned about the variety of alternative routes tried and the way that much of this knowledge remained within the company as an oral history that could be readily tapped among the lifetime employees. They began to appreciate the painstaking and systematic background to current designs and could reassure UK staff that many potential solutions will have been tried. Moreover, learning the key figures in the R&D centre provided the British returnee with a stock of e-mail and fax numbers whom he could contact directly on behalf of UK colleagues. One of the significant issues in design was an appreciation of the differences in relationships between assemblers and suppliers. Japanese designs had to be adapted so that they could be made with high levels of European content—in other words, so that they could be made from components that European suppliers would be able and willing to supply. As a UK engineer in a business equipment company explained: Engineering drawings can be a terrible source of problems. Engineering drawings are a guide to what should be done. We consider them to be a master plan. In Japan, they have a relationship with vendors that we don’t have. The vendor might be financially dependent on their company, either because they have financial links or because they do so much business with them. We just don’t have that kind of power in the UK. In the UK, we might only do 10 percent of the vendor’s business. Vendors in Japan will be willing to spend much more on equipment or take changes in products, specifications and tolerances. Often, because of the close relations, they will make changes without changing the drawing. We have got design authority in this UK plant, and we can change drawings so long as we let the parent company know, but we don’t have their kind of relation with vendors. (British design engineer, Denki company) A British mechanical engineer working in the design and development department of a television company in Japan echoed the earlier comments of the British engineer in Kuruma about the importance of understanding the indirect and implicit character of a Japanese supervisor’s instructions: You learn that if you are asked to go to look at a problem, then it means go and solve it. It doesn’t just mean look at it. It means go, investigate and gather a team to solve it. (British engineer, Terebi company)

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When the Japanese companies were transplanting the manufacturing process, they frequently had a template in a ‘mother plant’ in Japan which served as a reference point and source of continuing communication and support. There is a growing folklore on the human resource aspects of the transplant process for manufacturing activity, from the role of the Japanese expatriate engineers to the despatch of UK production supervisors to Japan for intensive training in the production techniques in the ‘mother plant’ and affiliated companies. The car assembly companies and the electronics companies can often supplement this process with visits to other overseas plants in English-speaking environments in the US or Singapore. While some engineers found these trips beneficial, others noted a preference for learning from the ‘mother’ (Japan) rather than the ‘daughter’ plants. Facilitating communication flows will be critical to the further deepening of inward investments in the transplants. Some companies had established ‘social budgets’ to facilitate social activities outside working hours. However, patterns of social contacts outside formal working hours did not match those levels of socialising reported among the Japanese R&D workers in Chapter 6. This meant that one traditional channel of supervisory feedback on an engineer’s performance and career progress was not readily available in the UK plant. Japanese managers did not find that more direct and explicit feedback came easily, as a Japanese Design and Development manager explained: Japanese managers don’t say ‘Great!’ We should make better use of the appraisal system. Managers should know what motivates UK staff. In Japan, people are motivated by salary, bonuses, rotation, their interest in the projects, and so on. We have a lot of informal meetings so that managers and engineers get a lot of information about what is going on. We can talk about things without risk. We tend to use ishin-denshin (telepathy or tacit understanding) and we don’t give explicit approval. (Japanese Design and Development Manager, Denki equipment company)

R&D: the ‘attached’ and the ‘independent’ R&D units The establishment of Japanese overseas R&D has coincided with interest in the globalisation strategies of multinational corporations and prompted some speculation that Japanese companies might better integrate their R&D operations than American and European counterparts who established their overseas R&D operations in an earlier era of internationalisation (Papanastassiou and Pearce 1994, 1995). In looking at this overseas R&D, it is important to distinguish inter-industry differences and differences between ‘research’ and ‘development’. The electrical industry is responsible for the overwhelming bulk of the overseas R&D expenditure and employment of researchers (Kiba 1996). There are inter-industry differences in location with

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the bulk of this electrical industry overseas R&D located in north America, followed by Europe, with a relatively small proportion going to Asia (Kiba 1996). There is a similar pattern in pharmaceuticals. However, the bulk of the vehicle-industry overseas R&D goes into Asia, followed by north America and Europe. In very impressionistic responses by head office to an evaluation question, there is a clear tendency to see strong advantages in conducting ‘research’ overseas, but overseas ‘development’ is seen as weaker than that conducted in Japan, reflecting views seen in Chapter 4 about the relative strengths and weaknesses of foreign and Japanese universities in fundamental science (Kiba 1996). On the other hand, R&D managers are confident about the strength of the tightly integrated networks, both internal and external to companies, which support innovative development in Japan. Sensitive to the charges about screwdriver plants, JETRO has gathered information on the development of R&D activities by Japanese companies, including both those R&D units established on factory sites (the ‘attached’ units) and the independent units (the ‘independent’ units). The 1996 JETRO Survey noted that 28 R&D units in the UK have been established separately from any manufacturing activity and function as ‘independent’ units (JETRO 1996). In his survey of 10 of the more prominent ‘independent’ R&D units, Cairncross noted not merely the deliberate organisational and physical separation of R&D from manufacturing activities in the UK, but that several of the companies had no manufacturing in the UK (Cairncross 1994). On the other hand, some companies planned for their ‘independent’ unit to become a key R&D element in an integrated European business strategy involving the full complement of inter-linked business operations from R&D to manufacture and sales. One company used its UK-based R&D unit as a base for exploring British industry for a potential partner to establish a joint activity combining their own production-engineering expertise and British high-technology expertise. The chequered experience of the joint venture appears to have persuaded the Japanese partner to stay closer to core company skills and incremental innovation rather than try the large leap of radical innovation envisaged through the joint venture. By 1994, the ‘independent’ units were relatively small in size, typically with 15–20 staff. However, they were still recruiting and growing in size. They had few British staff, but half had a Japanese director. Eight of the 10 companies in the Cairncross study had located their R&D unit close to a British university campus (see Tables 7.6 and 7.7). Among several advantages this gave good access to internationally recognised researchers as collaborators in the university laboratory and potential help in recruiting researchers to their own laboratory activity. For example, the Toshiba laboratory was quite explicitly set in the Cavendish Laboratory at Cambridge University in order to associate with the renowned semi-conductor research in the host laboratory (Williams 1990, 244– 5). The British Embassy noted that supporting a confidential collaborative research programme at a British university or national institute is ‘a very cheap and cost-effective method of doing research’ (Salusbury 1995). For example,

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Table 7.6 Characteristics of Japanese R&D units in Europe

Source: Adapted from JETRO 1997

Table 7.7 Parent company industries of principal independent R&D centres in the UK

Source: Adapted from JETRO 1997

it was estimated that a relatively modest outlay of 150,000 yen could secure a post-doctoral research assistant, supervision from a professor, and maintenance of equipment and purchase of materials.

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Various rationales for the location of these R&D units have been offered. Where companies are producing in the UK, they can portray their R&D unit as a further dimension of localisation, with locally designed products to satisfy local consumer need. Even without local production, companies can point to the need for information about local markets to enable speedy responses to competition for technological superiority or to the role of the local R&D unit in shortening lead times from R&D to commercialisation of products for European markets. Most companies report little difficulty in attracting applicants for their ‘independent’ R&D units, indeed interviews suggest that they have been surprised by the large numbers of applicants relative to places. However, one laboratory determined to be the main R&D laboratory for the company’s European operations regretted the relative paucity of applicants from outside the UK. Another concern for some of the laboratories is that the small size and limited links with other company operations in Europe mean limited career prospects. Here lies a central dilemma for the companies expressed in interviews in the Tokyo head office—how far should they introduce foreign researchers to core company technologies when they might leave for careers in rival companies? It is an anxiety felt quite sharply by Japanese senior managers accustomed to the long-term employment system. Conclusions Using a variety of research methods, including surveys and case studies, I have illustrated the complex processes for Japanese companies in building their R&D operations in the context of a different ‘national innovation system’, particularly in coming to terms with human resource management issues for high-level scientific and engineering staff. There are several problems in upgrading technological capabilities, particularly problems in recruiting and retaining UK engineers with different experiences and expectations in careers, work organisation and engineering management. My starting point was the characterisation of the recent growth in the numbers of overseas Japanese corporate R&D establishments. As yet, the scale of Japanese R&D conducted overseas appears small compared to the R&D efforts of US or European corporations. This raised the question of whether this difference was simply a matter of timing or more properly a consequence of the structural features of the Japanese system of innovation. Using MITI data to analyse the determinants of overseas R&D, Belderbos has concluded that the evidence of a Japanese lag can be attributed largely to the relatively recent timing of internationalisation strategies among Japanese firms, but this data does not support the argument that Japanese companies have a greater propensity to centralise R&D in Japan (Belderbos 1996). My own question was somewhat different. I did not examine the determinants of overseas R&D investment, the factors which shape the motivation to build overseas laboratories. I asked whether the social organisation of R&D in home

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and host countries was different. Having identified some significant differences in the organisation of the labour market for scientists and engineers, notably the operation of the lifetime employment system in Japanese companies and the greater use of external labour markets by British companies, I argued that Japanese companies would face some particular difficulties in coming to terms with different labour markets and social institutions in host countries in which they invested. Thus, even if Japanese companies were prompted to overseas investment by the same factors as multinationals from the US or Europe, institutional features of home and host countries set problems which could at worst inhibit and at best slow down the rate of moves overseas. While the survey illustrated the relatively small numbers of scientists and engineers in most manufacturing establishments, the case studies demonstrated the way companies grappled with problems stemming from differences in labour markets and in the ‘taken-for-granted’ assumptions of Japanese and British engineers. Faced by problems ranging from labour turnover to salary determination, the case-study-companies through trial-and-error learning adopted pragmatic policies and practices to resolve problems and develop their R&D activities. With hindsight, companies have made mistakes in policy and practice but have endeavoured to learn from the process and make institutional adaptations. The case-study companies included: a company, determined to recruit fresh graduates uncontaminated by British industry and train them in Japan, which abandoned the scheme when it found that these recruits were marginal in both settings and soon left; another company which organised effective training only to lose staff to a competitor and which changed appraisal and pay policy; a company, keen to speed up localisation, which was chastened by the penalties for excessive speed. Surveys based on official statistics generally produce a freeze-frame of the dynamic processes in a sample of transplants where some companies may be expanding and some contracting operations. When Toshiba ended its joint venture with Rank and took sole responsibility for TV assembly in Plymouth, the company was transformed. In place of Rank-Toshiba, with four factories producing 62 models with 2,600 people represented by seven unions, Toshiba relaunched the TV plant as a single company operation with one factory producing eight models with 300 people represented by one union. Such bald accounts of the new company underlie images of the ‘screwdriver plant’. Accounts of the new plant contrast sharply with Fruin’s description of ‘knowledge works’ in his portrayal of Toshiba’s Yanagicho plant (Fruin 1997). Such factories are marked by their formidable range of products and product innovations resting on high levels of knowledge and skill in the workforce which Fruin describes as very site- and person-specific, nurtured by the lifetime employment system, quality circles and rotation policies. These institutionalised features of human resource development in Japan, Fruin suggests, lie behind the difficulties in making successful transplants. However, Toshiba has since groomed two plants in Plymouth, by adding design and development to the TV plant and by adding an air-conditioning plant, to employ over 1,000 people.

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The focus on the role of engineers in transplants has shed some further light on the debates about the scale of investment, character of the manufacturing and skill levels in transplants (Williams et al 1992; Oliver and Wilkinson 1992; Munday et al 1992). The ‘Engineering Careers’ survey demonstrates that many Japanese companies are actively engaged in upgrading their operations despite the background of difficult trading conditions in European markets in the 1990s, the problems of recession facing their parent companies in domestic markets and the fluctuations of the yen. Although the parent company, Nissan, has been the subject of much anxious debate in Japan, the transplant, Nissan Manufacturing (UK), continues to earn high praise for its efficiency. While the high yen of the early 1990s caused problems in markets and accelerated moves to offshore production, the fall of the yen in recent years has led to reassessments of overseas compared to domestic manufacture and squeezed company resources available for overseas investment. However, it is more likely that these currency and resource effects will have greater impact on Japanese investment in east Asia than in Europe. It is the investment in east Asia which is more likely to appear marginal than the investment in Europe, particularly following the autumn 1997 financial turmoil in east Asia and loss of markets. Despite the sanguine views of the Cardiff-based researchers about Japanese investment in Wales, some surveys of the TV-company transplants emphasise the limited skill levels of the assembly operations (Danford 1998). However, this is partly a constraint set by the education and labour markets which supply insufficient volumes of potential recruits and inhibit the development of high technical skills in the workplace (Sako 1994; Delbridge et al 1998). The investigation of human resource management issues in R&D demonstrates that the issues in technological upgrading are complex and that successful solutions to the early phases of setting up overseas assembly operations can leave a legacy of complications for later technological upgrading. For example, the location of assembly plants in areas with plentiful supplies of unskilled labour can inhibit the recruitment of engineers and scientists. The location of ‘independent’ research laboratories on university campuses illustrates a quite different path of investment and solution to problems of attracting high-calibre technical staff. Even when localisation policies are pursued in development laboratories, the operation of the more open labour market can set the programme back by two years through the loss of key personnel. The snapshot of investment available through surveys can understate the problems and solutions in the strategic evolution of Japanese investment, which are better explored through case studies and repeat visits. Going beyond the checklist of Japanese features used in surveys of ‘Japanisation’, the case studies and interviews with British and Japanese engineers revealed that not just cultural factors can impede the processes of technological upgrading. Studies of manufacturing operations and industrial relations suggest that the policies and practices adopted in transplants are far from the closely integrated forms identified in Figure 7.1 (McCormick and

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McCormick 1996). It has proved relatively easy to establish assembly production using local labour under the guidance of Japanese engineers. However, fuller manufacture under local management requires the building of trust between engineers and the development of a local engineering capacity. Broadening role responsibilities, sharing and disseminating technical information and decision-making were all areas governed by different cultural patterns which required negotiation and accommodation. Fujino has likened globalisation in Japanese overseas operations to a two-track process, where production has proceeded quite rapidly but administration has lagged behind (Fujino 1998). The main difficulties in the administration area lie in the socialisation of Japanese managers into three principles underlying decisionmaking—‘hokoku’ (to inform), ‘renkaku’ (to report), and ‘sodan’ (to consult)— and the difficulties in establishing working relations with local managers operating on different principles. Within the lifetime employment system and the domestic environment, ‘ho-ren-so’ becomes second nature to Japanese managers but taxes British colleagues in transplants. While of doubtful value in the analysis of manufacturing, the term ‘Japanisation’ has even less relevance to the examination of R&D operations. The couplet of ‘R&D’ should be treated with considerable caution and the diverse range of activities covered should be unpacked. The bulk of R&D activity in the UK is ‘downstream’, that is more akin to development work directed to applications and local adaptations, rather than ‘upstream’, in the sense of basic or fundamental research. While Japanese companies might have confidence in the competitive strength of development work in Japan, it is clear that the types of R&D undertaken in Japan are changing, that companies are investing in more longer-term research, that there is much debate about the need for new institutional relationships in Japan, and there is much less sense of a Japanese model of ‘best practice’ ready for export in R&D compared to manufacturing. It is apparent that Japanese companies are using overseas R&D, not only to tap into scarce knowledge and skill, but also to gain closer experience of other national systems of innovation and to learn more about the conduct and organisation of fundamental research. With echoes of earlier discussions of ‘late development effects’ for Japanese companies, Papanastassiou and Pearce have speculated that the coincidence of the relatively late entry of Japanese companies to overseas R&D and the increased attention world-wide to the globalisation of business could mean that Japanese companies will develop a pattern of overseas policies and practices more closely attuned to the requirements of global business than companies from other countries which set up overseas R&D in earlier phases of international trade and manufacture (Papanastassiou and Pearce 1994, 1994). Given the age of the R&D facilities, this must remain a hypothesis for further examination. As yet, the development laboratories rarely practise among their UK staff anything akin to the rotation of Japanese personnel. While there might be short business trips to other European facilities or longer-term assignments in Japan, there are few attempts to build the integration of activities through flows of people which the companies practise for their Japanese staff in Japan

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and for their expatriates in the UK. The available evidence of control systems and linkages to the UK science and technology infrastructure suggest limited contacts. While interviews with engineers raised many of the difficulties in working across different engineering and national cultures, the engineers encountered were broadly positive about their employment in Japanese-owned R&D facilities. Whatever the variations of plant size within the UK samples, whether by industry, by mode of entry into the UK (acquisition or ‘greenfield site’), or by date of establishment in the UK, the scale of operations are typically small by comparison with parent company operations in Japan. In consequence, the patterns of recruitment for the British and Japanese engineers are very different. Very few of the transplants are engaged in regular recruitment of scientists or engineers from British universities or in the employment of large numbers of scientists or engineers. Plant size and anticipated career opportunities might depress the pool of job applicants. Yet two factors behind several of the positive comments from UK engineers were the fact of employment, given the shrinkage in the scale of UK manufacturing industry, and the reputation of Japanese manufacturing technology. Both were viewed as very positive benefits for the British scientists and engineers met in our case studies. Parallel to the debate about the host country benefits of inward investment in manufacturing industry, there has been some debate about the establishment of R&D units by inward investors. Some researchers have identified the recruitment of skilled scientists and engineers by overseas-based multinational companies in Britain with an internal ‘brain drain’. Noting that the multinationals are attracted to the UK by a strong university system, relatively low pay rates for scientists and engineers, and the international character of the English language, these researchers fear the overseas companies exploit under-priced UK technological resources and take the results of research overseas (Turney 1989). Much of this critique has been directed at American rather than Japanese companies and at the fundamental rather than applied R&D units. A more positive view of the recruitment of UK engineers by Japanese companies is voiced understandably by spokespersons for Japanese industry. Minato Shungo, on behalf of the UK branch of the Electronics Industries Association of Japan (EIAJ), drew attention to the ease with which engineers could be recruited in the UK, largely because the contraction of the UK manufacturing industry (Large 1990). He noted that although Germany produced more professional engineers, it had a large manufacturing sector competing more vigorously for their services. In addition to our survey confirmation that companies had been able to recruit unemployed engineers, we interviewed several engineers in the case-study companies who been recruited out of unemployment. Clearly there is a strong political impulse intertwined with the economic strand to the location of R&D, evident in the prompting of the UK government to persuade Japanese electronics companies manufacturing in Britain to set up local R&D activities (Skapinker 1990).

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Two related points which should not be underestimated in looking at Japanese R&D in the UK are the need for scientific and engineering success and the length of time needed to build a viable R&D establishment. Official surveys do not give much data on the scale of investments or numbers of R&D staff. Even where the function of an establishment is claimed to be ‘basic research’, a staff of only two or three engineers could indicate little more than a ‘listening post’ or ‘window on the West’. A British Embassy report on Japanese R&D in the UK noted a median staffing figure of 28, including support staff. The evident strengths of institutional relations identified in analyses of the Japanese national system will add weight to any tendencies to rely on R&D in Japan and restrict the overseas laboratory role to that of a listening post. Transcending this role will require strong championship from corporate head office and central laboratories and the ability to attract able R&D staff within the UK. Yet attracting high-calibre R&D staff and giving them scope is likely to depend on a proven track record of success. There is something of a chicken-and-egg relationship about the need for success and the development of overseas R&D, particularly for Japanese companies. Twenty companies claim specific successes from UKbased R&D already, but the strongest proof of their ability to cope with the human resource management issues and enter the virtuous circle of building viable R&D activities will come with the design and development of major businesses based on their UK R&D (Lynch and Sims-Williams 1996). Notes 1 Tanaka is not a real name. 2 The Engineering Careers Survey was undertaken in collaboration with David Cairncross, Brian McCormick, Alan Turner and Yumi Hanstock. 3 Qualifications were outlined in Chapter 2.

8 Conclusions Comparisons and contrasts between engineers

‘Japan’s continuing success is both inevitable and inexorable unless her competitors can learn the simple lessons explained in this book…. What is so extraordinary is that the West has made such little real effort to understand the reasons for Japan’s success.’ (Lorriman and Kenjo 1994:6–7)

Introduction The aim of this final chapter is to pull together some to the threads of what we have learned about Japanese and British engineers through comparative study, highlighting both the diversity of approaches to comparisons of Japanese engineers with those in other industrial countries and the evidence of considerable diversity among engineers in both countries. Two important benefits from the accumulated attempts by social scientists to undertake serious and systematic comparative research on engineers in Japan and other industrial societies have been: first, a greater appreciation that the way in which engineers are educated, trained and employed in one society can provide a critical mirror in which to view social arrangements in another society; and second, that a realisation that one should treat populist accounts of engineers and their societies with a good deal of scepticism. Often, we have seen attractive images of Japanese engineers and engineering conjured out of secondary sources rather than from direct research or matched samples of engineers. All too often, these images have turned out to be little more than wishful thinking, projecting on to Japanese engineers and engineering those characteristics, achievements and rewards which reformers believe are necessary to bring about a British economic renaissance in manufacturing industry. It was a curious kind of thinking backwards from effects to supposed causes which ran along the following lines: here are the kinds of engineers, their rewards and social standing necessary to bring about manufacturing success in Britain; Japan is successful in manufacturing; therefore, Japanese engineers must have these characteristics and social rewards. The proposed reforms for the education, training and employment of engineers might well have been plausible and effective on their own terms in a British context. But they could not be legitimated by reference

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to Japan. Moreover, this process was likely to obscure who engineers are and how they work in Japan. If there are attractive strengths in Japanese engineers and engineering, they are more likely to be found by more direct observation and by close comparison of engineers, and by setting education, training and employment of engineers in their wider national context. We can readily understand why authors, such as Lorriman and Kenjo quoted above, whose prime focus is on policy matters and who believe that they have a singular insight into Japanese economic success, are scornful of past efforts to understand Japan and add a dash of hyperbole to their own recipe for economic success. However, there have been numerous missions and schemes from Britain to learn about Japanese engineers and engineering, ranging from the efforts of individual companies (such as those of the auto component maker Lucas) to schemes organised by trade associations and government departments, and the Engineers to Japan Scheme operated by the Royal Fellowship of Engineering on behalf of the Department of Industry (DTI). Yet, however laudable the insights garnered in the 1980s, the notion of Japan’s ‘inevitable and inexorable’ success was wearing more than a little thin by 1994. The end of the ‘bubble economy’, followed by the deepest and most traumatic recession of the post-war years which had started in 1991, had shaken such simple faith. The diverse purposes underlying research have generated considerable variety in the types of inquiry and comparisons undertaken. The purposes have been varied (from academic curiosity to policy guidance), the methods have been varied (from interview to mailed questionnaire), the sampling of respondents has been varied (from educational outflows to employment inflows) and the industrial sectors have been varied (although electronics companies and electronic engineers have been prominent in most of the Japan-related comparisons). Usually, two-country comparisons have formed the base of most studies. The theoretical focus in the studies has varied, but much of the attention has been focused on contrasts drawn between the different types of labour markets—internal labour markets and external labour markets—and the degree to which industrial companies in Japan and another country rely on either predominantly external or internal labour markets and the correlates or consequences of these types of markets for education, training, careers, and so on. These attempts to outline the contrasts between two types of labour market are but one example of a more general process of typology construction in science, and are like the classification preoccupation of natural history. However, good classificatory schemes should not be ends in themselves, but should be judged for their fruitfulness and we shall examine typologies of engineers for their adequacy in description and generation of explanation. The following sections summarise what we have learned through comparative study about: the processes through which Japanese and British engineers join the ranks of professional engineers; attempts to construct models of the production and organisation of engineers; the diversity of methods for comparing engineers; and the diversity revealed among both engineers and the contexts in which they work.

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Becoming professional engineers The acquisition of ‘professionalism’, the mark and qualities of a professional, is a lengthy process, but one which varies across company and nation depending on the organisation of recruitment, the development of competence and the management of careers. In this section, we can summarise some of the significant similarities and differences which have emerged in comparisons of Japan and Britain. Recruitment In Japan and Britain, the employment of professional-level engineers has been dominated by large companies and new entrants are typically recruited after university study (Chapters 3 and 5). However, the operation of the long-term employment pattern in Japan has meant that the large Japanese companies have tried to maintain a regular annual recruitment, irrespective of short-term or specific requirements, because the employment system has put a premium on new graduates for internal grooming to management posts. The new graduates come to define their career progress in terms relative to the experience of other members of their year group of entry. The new graduates are subject to the same starting date of employment, the same procedures, the same starting salary. Unlike their British counterparts, they have little scope to negotiate individual conditions. There is no direct relation between initial training and the first task assignment. The broad consensus about the respective roles of university and employer has meant that universities have concentrated on a very academic curriculum while companies have put a strong emphasis on the practical training which starts with employment. In Britain, there have been many more varied pathways into engineering, but the large shift to concentrate entry through universities which ended the traditional ratio of HNC to degree engineers led to pressures for curriculum reform to incorporate more training elements into the university curriculum and efforts to restructure a new ratio of elite to mainstream engineers around the M.Eng/B.Eng degrees. Although the large British companies have developed internal labour markets, their ready access to the labour market for mid-career recruits has meant that long-term needs have been strongly influenced by the need to fill defined jobs in the short run. These differences in employment principles have meant that the central personnel department has a much more influential role in the Japanese company and its recruitment of engineers. Our surveys of entry to industrial R&D (Chapters 4, 5 and 6) confirmed that Japanese companies have been moving to make the master’s degree the main professional entry-level qualification to R&D functions, while British companies maintain a wide variety of entry points and a wider spectrum of qualification levels, including a much higher proportion of university-trained doctorate-level entrants.

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Entry into working life In neither Japan nor Britain are engineers considered ‘finished products’ on leaving the educational system. However, the larger element of practical work in the British first degree and the large element of research training in the British science or engineering education means that British employers expect a quicker return on their investment and British engineers consider themselves ‘fully fledged’ sooner after graduation than Japanese employers and engineers do. Beyond induction, on-the-job training provides the main channel of skill formation. In the Japanese companies, these early work experiences are more clearly programmed with the support and monitoring of the central personnel department, whereas responsibilities for British engineers are typically devolved to their employing department. For many Japanese manufacturing companies, those new entrants destined for manufacturing or development departments took assignments bringing close contact with manual workers and technical support staff. In addition to developing technical skills, there is considerable emphasis on building shared corporate identities and minimising internal differentiation between engineers and the blue-collar staff, using a number of devices which range from common company uniforms to narrow salary differentials. Tasks are progressively enlarged in line with developing professional competence. Career progression and mobility The main reference points for Japanese engineers to check career progress have been comparisons with other members of their entry cohort to a company. They have had relatively little incentive or scope to check the external labour market, although the large directories of the Recruit Company invite engineers in a career ‘flat spot’ to test the external labour market. For the most part they will know that they will travel more or less in step through the early years of their company careers until the 35 to 40 age range, whereas British engineers are more rapidly tried and tested and channelled into different career paths. Typically, the first phase of the Japanese engineer’s career has emphasised the engineer’s role in a learning organisation and the contributions which engineers make to the stock of corporate knowledge and skill. The second phase has been concerned with the passage into and through the layers of the managerial hierarchy. Historically, the pool of engineering graduates has been an important source from which the future incumbents of the management hierarchy have been drawn in manufacturing companies. This traditional pattern is being challenged. Two blades have been cutting away at the relative prospects for managerial promotion. On the one hand, the massive recruitment of engineers in the late 1980s increased the number of rivals while slower economic growth at home and abroad in the 1990s has reduced the rate of growth of managerial openings. On the other hand, the growth of R&D expenditure and the demand

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for specialists has opened the possibilities for careers as specialists such as technical ladders in R&D, and companies have been exploring the implications of more diversified professional career paths for engineers. Organisational competence and skills The marked contrasts between Japanese and British R&D staff estimates of the age at which they became ‘fully fledged’ provided vivid evidence of the view that skills and recognition for the Japanese engineer are built patiently over a lengthy period of time. Taking up the role of a learner, the Japanese engineers become immersed in training in the proficiencies and tasks covered collectively by the work groups to which they belong. The main priorities for their contribution to their groups, and the main criteria by which they will be judged, lie in guaranteeing collective succession rather than pushing out on bold strokes of creativity or technical risk. Lanciano and Nohara emphasise the acquisition of ‘production intelligence’ and the ‘building of complementary social relations with other categories of workers’ as two major ingredients of the organisational socialisation of Japanese engineers (Lanciano and Nohara 1993:4). Earlier chapters have demonstrated that much of the learning experience has been concerned within the organisational context of engineering, with becoming ‘corporate salarymen’. ‘Production intelligence’ was developed by adding empirical and tacit knowledge to the engineers’ theoretical knowledge gained at university. From the company president’s address to the annual graduate intake at induction to the assignments on rotation, there is a great deal of emphasis on how the company works and on how the successful product lines have been developed and taken into the market. The strength of this tradition in engineering formation was evident in British engineers’ admiration of the product knowledge of their Japanese mentors in the transplants in the UK and in the comments of those British engineers who had extended placements in their own company’s laboratories and plants in Japan (Chapter 7). The complementarity of the different categories of technical labour are evident in the company emphases on common company membership, the overlapping of skills, and the comments of Japanese engineers about the narrowness of conceptions of engineering which they found among British engineers. The traditional patterns of professional development for engineers in Japan have been associated with clear proficiencies for individual engineers—for example, the facility with which engineers can take products from prototype to market— and for companies—for example, in the industrial strength built on mechanical, electrical and electronic engineering in the mass production industries. However, fears that the traditional approach to the education and training of engineers in Japan will impede effectively meeting future company needs are readily apparent, evident in discussions of science education (Chapter 2), debates on personnel management for R&D staff and in survey responses of R&D staff themselves (Chapters 5 and 6). The thread of emphasis on conformity which runs through the educational system and professional socialisation has

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come to be increasingly seen as a possible impediment to that originality and creativity judged necessary for more radical innovation in new industries. Models of the organisation and production of technical labour Collaborative and comparative research based on extensive data collection with matched samples is time-consuming and expensive. However, summary reviews based on a common agenda can provide an alternative route for studies concerned more with analytical frameworks and the development of typologies of national systems for the organisation and production of technical labour. Meiksins and Smith took this route to one of the most ambitious attempts to provide a comprehensive conceptual framework for the comparative study of engineers and engineering work. Drawing on their own empirical studies of engineers in the US and Britain and secondary source material on engineers in several other industrial societies (France, Germany, Sweden and Japan), these sociologists developed a typology of the production and organisation of technical work in industrial capitalism. Their ultimate aim was to use their classification of national differences among engineers to examine the prospects for the transfer of ‘best practice’ engineering across national boundaries (Meiksins and Smith 1996). For example, if Japan is widely seen as the source of ‘best practice’ manufacturing, will the principles and practices of manufacturing technology developed in Japan become adopted world-wide, despite those national differences? The first step in their approach was to construct some ideal types of the organisation of technical work, based on four central dimensions covering: • the principal mode of recruitment to technical work, in particular the relative importance of formal educational qualifications in engineering formation; • the status of technical workers, in particular where technical workers fit in the division of labour between management and manual labour; the character of the labour market for technical labour, in particular whether the employing organisations tend to rely on a restricted number of entry points to the organisation after formal education and subsequent recruitment through an internal labour market or whether employers use both internal and external labour markets to meet their requirements for technical labour; and • the organisational forms typically chosen by engineers to represent their interests, in particular whether they form professional institutions with study and qualification functions or whether they join labour unions to bargain with employers. Meiksins and Smith then identified four principal ways of combining these dimensions: in effect, four distinctive types or models for producing and organising technical labour (the four types are summarised in Table 8.1, adapted from Meiksins and Smith):

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• The craft type, where recruitment rests largely on entry to an apprenticeship and pupillage by school-leavers, where the status of technical workers is close to that of manual workers, where employers will use both internal and external labour markets, and where technical workers will form labour unions with a character similar to those of other craft workers. • The managerial type, where formal education at university level assumes more importance in recruitment, where technical workers take up a status among the managerial grades of employee, where employers again use both internal and external labour markets to secure staff, and where technical workers form professional institutions, albeit with weak attachments. • The estate type, where recruitment to a graded hierarchy of technical occupations is based on performance in a matching hierarchy of technical qualifications, where the fine grading in these hierarchies makes for a less dichotomous set of identifications found in the ‘craft’ or ‘managerial types’ and gives some credence to the notion of a ‘third force’ in the professions, where employers’ use of either internal or external labour markets depends on the positions in the hierarchy under consideration, and where representative bodies run the full gamut with higher-level technical workers more prominent in professional institutions and manual workers more prominent in labour unions. • The company-centred type, where recruitment is heavily shaped by formal education, especially university-level study, where there is no sharp differentiation from either management or manual workers, where employers rely predominantly on internal labour markets, and where representative organisations tend to be built around common interests in the employing organisation and are of an enterprise union type. Meiksins and Smith are careful to underline the strengths and weaknesses of this ‘ideal type’ analysis. The types are abstractions, drawn as characterisations from historical experience but unlikely to be found in this pure form in any country. Their prime purpose is to serve as analytical tools to sharpen discussion of particular countries, and ‘ideal’ derives from the idealisation in a pure form rather than any sense of the desirable. Each of the types can reveal similarities on some dimensions and differences on others, for example, the ‘craft’ and the ‘managerial’ types emphasise the sharp differentiation between management and labour, whereas the ‘estate’ and ‘company-centred’ types soften these distinctions. On the other hand, for Meiksins and Smith, the ‘craft’ and the ‘company-centred’ types share a common emphasis on unionism as a form of representation for technical workers, whereas the ‘managerial’ and ‘estate’ types are more likely to generate professional institutions among the engineering grades of technical workers. Although any given country might exhibit a mixed type, the merits of the approach should lie in highlighting central features and in illustrating the correlates of social and technological change with shifts between types.

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Table 8.1 Models for the production and organisation of technical labour

Source: Adapted from Meiksins and Smith 1996:237

While this bold approach by Meiksins and Smith provides a useful framework for comparison, the typologies could benefit from more refinement—for example, ambiguities and problems emerge in the ‘status’ and ‘organisational form’ dimensions. Inevitably summary tables risk some oversimplification, but Table 8.1 is inconsistent in the use of ‘status’ across the four types. The ‘status’ dimension appears to bundle together relative economic reward, social prestige and authority at the organisational level, to incorporate both the observer’s and the technical workers’ view of their social position, and to aim for a notion of central tendency in a sample of engineers. Yet this heroic compression is given uneven treatment across the four typologies of the production and organisation of technical labour. While the ‘status’ of ‘technical labour’ is judged to be close to manual labour in the ‘craft’ type and close to management in the ‘managerial’ type, ‘technical labour’ is only shown to have contact with both management and manual labour in the ‘company-oriented’ type. It is a truism that technical workers have some kind of interaction with both management and manual labour in each of the models if an enterprise is to function at all, but the purpose of this dimension was presumably to facilitate a qualitative measure of the character of those interactions in terms of the tensions inherent in capital-labour relations in industrial capitalism. Thus while Meiksins and Smith indicate how they think that tension is usually resolved in the ‘craft’ and ‘managerial’ models, they leave unclear the likely outcomes in the companycentred model. The ‘organisational form’ dimension has another problem in an unduly ethnocentric interpretation of the available forms of organisation which

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technical labour might adopt. The polarisation which Meiksins and Smith see between the adoption of either labour unions or professional institutions to represent the interests of engineers seems to be derived too strongly from British experience to provide general categories for international comparison. In Britain, professional institutions have had an important impact on the control of numbers through their role in granting qualifications and this can be likened to the role of craft unions in controlling entry numbers through apprenticeships. On the other hand, while craft unions have engaged in collective bargaining with employers, professional institutions have emphasised individual mobility, leaving their members to gauge their own progress against salary surveys. This tends to leave British engineers with the dilemma of whether to conceive of their material advance in collective terms and join a labour union or in individual terms and join a professional association. Thus, the polarisation between unions and professional institutions in the ‘organisational form’ dimension might reflect fairly on the ‘craft’ model and earlier British experience (save in the 1970s when increasing numbers of public-sector engineers added union membership to their professional association membership), yet it does not necessarily reflect either the logical possibilities in other models or the historical experience in other countries. Where professional institutions have no qualification function and confine themselves to promoting study functions, there can be a clearer division of labour between professional institutions and labour unions and they need not pose mutually exclusive choices or dilemmas for engineers. In the ‘company-centred’ type, where employers promote a co-operative form of enterprise unionism, there is an even greater likelihood of dual memberships for technical workers in professional institutions and labour unions. Meiksins and Smith illustrate the value of their ideal types or models of the production and organisation of technical workers by linking them to several national accounts of engineering formation. Again emphasising that any particular country is unlikely to be a straightforward manifestation of one of the models, Meiksins and Smith demonstrate the importance of the ‘craft’ model in Britain’s pioneering stages of industrialisation, the significance of the ‘managerial’ model in the US, the influence of ‘estate’ models in continental European countries, such as Germany and France, and the emphasis on the ‘company-centred’ model in Japan. For Meiksins and Smith, these evident differences in national patterns should be understood historically and reflect the timing of industrialisation in each of the countries. They reject the notion that the different modes of engineering formation might be simply quixotic choices from a menu of equally viable options for different ways of producing engineers. With the emergence of the different types reflecting the different timing of industrialisation in each country, Britain, the pioneer industrialiser, adopted the ‘craft’ model, whereas the later industrialisers in continental Europe and the US adopted ‘estate’ and the ‘managerial’ models. Japan, an even later industrialiser in the era of increasingly important large corporations, adopted the ‘company-centred’ model. While emphasising that factors operating in the formative stage of industrialisation have enduring effects on the production

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and organisation of engineers, Meiksins and Smith briefly sketched some of the dynamics of change in the various contemporary national systems. However, it was the dead weight of history rather than any dynamic for change which Smith and Whalley stressed in looking at Britain: …British engineering remains weakly structured, highly contested, and unlikely to be radically transformed in the near future. A conclusion that would not have been radically different had it been made at any time during the previous century. (Smith and Whalley 1996:56) This conclusion has drawn sharp rebuke from some reviewers who have seen positive developments in the moves towards an all-graduate profession led by an increasingly effective Engineering Council (Glover and Tracey 1997: 765–6). In the more comparative essay, Meiksins and Smith conceded that Britain’s ‘craft’ model has become anachronistic with the increasing complexity of technological development, and they noted the efforts of professional engineering institutions ‘to construct estate-type hierarchies for technical labour, with the creation of chartered engineer, technician engineer and engineering technician categories’ (Meiksins and Smith 1996:250). Thus a developmental path from the ‘craft’ model towards an ‘estate’ model provides one scenario for Britain. Although the more recent proposals from British professional institutions (outlined in Chapter 2) for redrawing the lines around degree studies and entry to professional institution membership would be consistent with this trend, my own expectation is that capitalist enterprises will continue to provide the main dynamic for future developments, suggesting that the future is more likely to lie with moves towards the ‘managerial’ model. Support for this trend lies in two kinds of evidence: first, there is the extent to which management in manufacturing industry is dominated by engineers; second, there is the evidence that increasing numbers of Britain’s professional engineers report themselves in managerial positions, while decreasing numbers are members of trade unions (Barry, Bosworth and Wilson 1997; Engineering Council 1997). This does not mean convergence with American patterns, for the historical legacy of narrowly technical conceptions of engineering fostered within Britain’s professional engineering institutions have inhibited the incorporation of managerial elements into engineering education and a more expansive role for engineers in management beyond manufacturing industry. In 1996, Meiksins and Smith concluded that the ‘company-centred’ model of Japan seemed to be the most stable and harmonious of the four models, enjoying hegemony too, despite the considerable challenges of short-term recession and long-term structural change (Meiksins and Smith 1996:280). My own argument has been that Japan will take only modest steps towards the ‘managerial’ model in their domestic operations. Insofar as the financial underpinnings can be secured, companies are committed to the maintenance of the broad outlines of long-term

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employment for a core of regular workers and increases in mid-career recruitment are more likely to be at the margins. In addition to exploring the dynamics of change in systems, Meiksins and Smith use their typology to explore the role of engineers in the production and dissemination of engineering ideas, especially ideas of ‘best practice’ production. On the one hand, they argue that the different national contexts will prove congenial to distinctive national preoccupations for engineers. For example, the sharp differentiation of French engineers from the world of bluecollar workers engenders an enthusiasm for design while the intimate links of Japanese engineers with production encourages attention to production processes. Thus, the nature of engineering ideas are specific to the particular problems and contexts in which engineers are produced and in the ways in which they are organised. On the other side, these national contexts pose barriers for the dissemination of engineering ideas from one country to another. The prescriptions for production processes generated by the American engineer, F.W.Taylor, designer of Scientific Management around the turn of the century, have been contrasted with the Japanese engineer, Taichi Ohno, designer of the Toyota Production System in the 1950s. The characterisation of their ideas and their impact have been hotly contested. Meiksins and Smith pick their way through these controversies to argue that since engineers produce solutions to specific problems their ideas are always likely to be considerably modified when applied to production problems in a different context. Thus, they argue against the notions ‘of cultural-free production systems’ which can be universal solutions to production in different countries and against ‘technological imperatives’ which are driving increasing convergence in the social organisation of production across societies (Meiksins and Smith 1996:269–72). The Meiksins and Smith typology will provide a useful starting point for future comparative studies. Moreover, they have demonstrated that it is not simply an exercise in typology construction for its own sake but can be used to generate hypotheses for investigation. In Table 8.2, I have recast the original Meiksins and Smith models in order to distinguish in recruitment between the two aspects of formal education and in-company training, since in some countries emphasis is put on one rather than the other, whereas in other countries both may be important. This issue recalls Chapter 1 and the historical debates in Britain about the reform of the craft model, and whether its replacement should take the form of incorporating ‘training’ into formal education on the continental European model. In Chapter 1, we saw that this issue was present around the turn of the century, with some envious eyes on Japan, and that it reappeared in the 1980s. Similarly, I have distinguished between two aspects of the status dimension of the original Meiksins-Smith model into social differentiation from management and from blue-collar manual workers. This enables a clearer delineation of the managerial and company-centred models and the panoply of devices which have been used by Japanese companies to try to bridge the status divide between engineers and blue-collar workers in the latter model. Finally, career mobility is added as another dimension to the

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Table 8.2 Dimensions of the production and organisation of engineers

Source: Developed from Meiksins and Smith 1996:237

labour market dimension of recruitment in Table 8.2, since there has been such strong emphasis on retention as well as recruitment in the company-centred model. Many features of the employment system in Japan have flowed from company commitment to the lifetime employment system (Chapter 3). Conclusions: diverse comparisons and diverse engineers The policy orientation of comparative studies has been a constant thread running through this account of the production and organisation of engineers. The belief that adequate supplies of well-educated, well-trained and well-motivated engineers are deployed and utilised effectively in manufacturing industry has underlain the curiosity of social scientists, the sponsorship of projects by government departments and the co-operation of companies with researchers. Of course, the projects on which I have drawn range widely across the spectrum which runs from the theoretical and curiosity-driven research to those projects more explicitly designed to answer questions posed by issues of public or corporate policy. Yet even studies sharing a common policy focus can differ significantly in their links to the policy process and the uses to which the research is subsequently put. The International Research Group on R&D Management study provided striking contrasts in the location of support for and subsequent uses of research reports in Japan and the US. The Japanese team gained support for the Japanese surveys from the Japan Productivity Centre (JPC) and enlisted additional team members from the research departments of JPC and the Japan Institute of Labour, a research arm

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of the Japanese Ministry of Labour. JPC was established in the 1950s as a tripartite body of government, companies and labour established in the aftermath of the defeat of the Left unions and the reconstruction of a labour movement to accommodate the push for productivity improvements. By the mid-1980s, JPC had supported several surveys of R&D workers and documented their growing importance to innovative strategies of Japanese corporations. When the International Research Group on R&D Management planned to extend its coverage to the US, the Japanese team took the initiative and contacted the Office of Technology Assessment (OTA) in Washington DC. The request to OTA, a body which provided advice and research support to Congress on science and technology policy matters, coincided fortuitously with a period of political ferment in the US over trade and technology issues with Japan. The opportunity to gain some systematic insight into human resource management in Japanese R&D was readily seized and support secured for a university-based researcher to undertake matching surveys in Japanese corporate R&D laboratories. However, the JPC/JIL axis, the research departments of a tripartite body and a ministry, provided a very different point of contact with the policy process from OTA, an advisory body for the legislature. The Japanese research context provided a link to the bureaucracy, whereas the American context provided a link to the politicians. However much scholars might debate the historic role of MITI in Japan’s technological development, there is a wide acknowledgement that the Japanese bureaucracy plays a much greater role in the devising of policy and drafting of legislation than their counterparts in other liberal democracies. Findings from the draft research report of the Japanese team (JPC 1991 a) were incorporated into the Japanese government’s 1990 Economic White Paper in the chapter on technological development (EPA 1990:133–5). By contrast, the American report penetrated less deeply into the American policy process since the political agenda and preoccupation of the politicians had moved on swiftly between grant approval and report (Shapira 1990). Despite these different points of contact with the political process, concern with organisational survival has been a feature in both systems. In Japan, JPC has had to cope with changing circumstances, the curbs on public expenditure and the belt-tightening of the corporate sector in the post-bubble economy. Underlying these short-term changes, JPC sought a new name to reflect a new mission since it has long-outlived the original concerns to lift Japanese productivity levels to match the more advanced levels of the West.1 However, in the US, OTA disappeared completely by the mid-1990s, a victim of the tussles of Congress and the Administration over public expenditure. Institutional survival in the corporate sector has proved mixed too. Of the original six British companies and six American companies in the International Research Group on R&D Management study, one British and one American have disappeared completely into takeovers and two other British companies have been significantly restructured to fight off takeover bids. On the other hand, all the Japanese companies remain largely intact, but attempting to cope with the changed circumstances of the long-running recession.

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Over the course of these chapters, I have traced a growing interest since the 1980s in comparative studies of Japanese engineers and engineering by social scientists, attempting to match Japanese engineers with those in other advanced industrial countries. These studies were stimulated in large part by speculation about the role of engineers in the relative national economic performance. As Japan’s manufacturing companies appeared to set the pace in international competition, more attention was paid to their employment and human resource management policies and practices. From the British side, this growing interest emerged against the background of a long-standing sense of disappointment about Britain’s relative economic decline and a good deal of curiosity and awe about the economic performance of Japanese industry. In the US and in some of the major continental European countries, concern about relative economic decline did not have such long roots as in Britain, yet there has been growing interest in comparisons with Japan in the 1980s. For their part, Japanese researchers were often more circumspect about Japan’s economic performance than their potential collaborators. From the Japanese side, interest in more systematic comparative study reflected the recognition that the Japanese economic performance was not uniformly excellent, that the institutional features underlying past success were changing and that the preconditions for continuing success might be changing too. Insofar as innovation and creativity were perceived to be stimulated by the flow of people, bringing fresh perspectives and varied experience to organisations, Japanese researchers were interested in how ‘Western companies’ promoted innovation and coped with more open labour markets. While British, American, German and French researchers might be interested in the alleged virtues of the lifetime employment system for the development and application of engineering knowledge and skills, Japanese researchers could hold that the lifetime employment might be becoming both less desirable and less feasible and might need to cede greater scope to mid-career recruitment. Thus from rather different starting points and orientations, researchers from Japan and other industrial countries could collaborate on a common theme—the implications of different employment systems and their potential for their future development. The fruits of more systematic collaborative and comparative research studies have done much to counter some of the wilder claims of commentaries on Japanese engineers by business pundits, who often used erroneous data, worked backwards from Japanese national economic success to infer a whole string of virtuous connections in Japan to be set against domestic vices, and then conjured up their pet nostrum for reform. Japanese engineers have not had particularly high social rewards in Japanese society, either in salary or social prestige, when compared to other graduates, whether we look back historically or in contemporary surveys. Within manufacturing companies, they do not appear to have enjoyed more favoured career tracks either. However, they do feel that their views have carried weight. Viewed in comparison with their British counterparts, what does appear impressive is the amount of engineering which companies have secured from their engineering workforce. Japanese engineers

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have worked a long working week. They have spent longer in the ranks of engineers before moving off into the ranks of management. They have spent longer learning the ropes over a wider range of tasks before considering themselves fully proficient in their professional roles. Japanese companies appear to have got a lot more engineering work out of their engineering workforce, and to have done so without paying premium rates. Moreover, they have been able to harness the efforts of these engineers to those of technicians and blue-collar employees in co-operative enterprises. The big questions for the future will be whether companies can elicit those high levels of effort and contribution in changed circumstances. Japanese engineers are finding a wider range of career opportunities opening as the finance sector needs more technological sophistication and offers higher pay than the manufacturing sector. The kinds of engineering knowledge and skill needed within manufacturing are changing too, and with the establishment of more long-term R&D there are pressures for more differentiated career structures. Meanwhile, the financial system which has underpinned the long-term perspectives of companies and the patient building of skills through in-house training is changing under internal and external pressures for reform. If the social structures supporting the moral order, often seen as an exchange of loyalty for beneficence, are changing, then it is far from clear what the new structures will look like. Even the most ‘Westernised’ of our Japanese R&D company sample was a good way off the most ‘Japanised’ of the British sample in terms of employee duration of employment. Far from a simple abandonment of lifetime employment and all its correlates and a move towards ‘Western’ practice, we are more likely to see Japanese companies and their engineering workforce adapting employment practices and policies to fashion new forms of organisation within a Japanese milieu. Although I have been at some pains to challenge many popular assertions and nostrums produced under the banner of ‘learning from Japan’, there are some points from earlier chapters which ought to be put before British engineers and industrialists. • Despite all the concerns about ‘hollowing out’, Japan’s manufacturing sector has remained much larger than Britain’s in terms of size in GDP and employment. In a sensitive analysis of the deep problems facing small manufacturing companies in Tokyo and Birmingham. Whittaker is more sanguine about the future for Japanese owner-managers than that likely for their British counterparts (Whittaker 1997). Among the large corporations, it seems that some curbs are being put on the increase in the longer-term research end of the R&D spectrum evident in the early 1990s, and that renewed emphasis is being put on the more immediate needs for advanced development. However, this is the area of traditional strength in corporate engineering in Japan. • In both the large and small firm sectors, enterprise initiatives have always been important, even when government ministries were in their heyday of

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‘administrative guidance’. For the future, companies will be even more reliant on their own resources to make their way in a competitive world. Therefore, attention should be focused on companies, particularly their management of human resources. • The mobilisation of human resources in Japanese companies has not been the product of ‘diligence’ or some other cultural virtue, but deliberately contrived efforts. In conducting comparative research, I have an abiding image of Japanese personnel managers arriving at interviews with thick files and folders, ready to answer factual questions from the massive detailed databases on their labour force. While labour-force audits have been canvassed among British companies, their practice is a long way short of that undertaken in Japan. Some instances are particularly colourful, such as the engineer (of Chapter 7) plucked from one division of the company, drafted to another division, and despatched to establish an air-conditioning plant in the UK. All this completed after the personnel department had combed the records for relevant engineering and language skills. Yet it is the routine nature of assembling and acting on such deep knowledge about the labour force that is outstanding. • While British engineers and industrialists share with Japanese engineers and industrialists a central belief in the importance of the workplace as the site for the most significant professional learning experiences of engineers, Japanese companies put impressive efforts into translating the rhetoric of terms such as the ‘learning organisation’ into reality. The manner in which Japanese supervisors are responsible for the development of their subordinates, the discriminating use of ‘rotation’ which translates a variety of experiences into a developmental sequence throughout the career, and the cultivation of small group activities are built into organisational structures and the routines of everyday organisational life. • Although it is often argued that the structure of British labour markets and British culture would militate against the application of any ‘learning from Japan’, this view seems excessively simplistic and defeatist. The point of learning is not necessarily the direct importation of foreign institutions so much as the observation of ‘good effects’ and the attempt to mimic effects through appropriate institutional means (Dore 1987). It must be remembered that Japanese companies learned much from the West and adapted Western institutions to local circumstance. Sometimes institutional innovations were legitimated by appeals to consistency with traditional culture. These appeals could include subtle sleights of hand such that it is fair to say that culture was being adapted to organisational needs rather than organisational innovations being adapted to culture (Tsutusi 1998:241). There is a growing literature which shows a more subtle interplay between learning, application and adaptation to a new context. Against the popular images of Taylor’s ‘scientific management’, largely rejected in Japan in favour of more indigenous and humane approaches to work design, and of Deming’s gospel on ‘quality’ being uncritically accepted, Tsutsui shows a much more nuanced

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picture of the strength of Taylor’s influence and the limits of Deming’s contribution through careful historical research (Tsutsui 1998, 1996). • Japanese companies are not devoid of conflicts over rewards and resources. However, Japanese engineers do not appear to be engaged in anything like the long pursuit of social status, buttressed by professional institutions, that has so occupied so many British engineers and inhibited the emphasis on co-operative relations pursued in Japanese companies. Co-operative relations are not the products of culture but of deliberate and sustained effort. • While British engineers put effort into self-development, comparative studies generate questions for British companies on how to generate—and coordinate—such efforts in more open labour markets. Interest in comparative studies of Japanese engineers grew in many industrial countries in the 1980s. It was prompted, partly by intellectual concerns in debates about the future development of industrial societies, and partly by more policy-oriented concerns and debates on the role of engineers in national economic performance. Japanese scholars had similar interests in comparative studies too. For some Japanese social scientists, Japan’s emergence as an economic superpower prompted a more critical appraisal of modernisation theory and an emphasis on a distinctive Japanese brand of capitalism which might serve as a more congenial model for development in Asia. Among other Japanese social scientists, there has been more scepticism about the scope of Japanese success and a continuing concern that Japan still had much to learn from the West, particularly in the management of R&D and radical technological innovation. Images of engineers and engineering have undergone profound changes since Henry Dyer and his young colleagues set off for Japan, developed an Engineering College and helped produce the early cohorts of Japanese engineers for Japan’s industrial take-off. Then, many of the mass production industries now most closely identified with Japanese engineers, such as automobiles, were barely visible above the technological horizon. Electronics had to wait over a half century later. Software, now such an important tool of engineers and such an important ingredient in competitiveness when blended with hardware, was not a part of the engineer’s armoury. Since the late nineteenth century, engineers have spread through many industries and many functions. Engineering is made up of a great variety of sub-disciplines and levels of qualification. Many writers on engineers echo the cry of some engineers that the public image of engineers is often confused and bewildered by this variety. If only, they lament, there was a clear consensus on educational curricula and qualifications and some system of registration or licensing which could regulate who was who in engineering. Yet it is not at all clear that, even with a system of one-to-one mapping between educational courses, qualifications and employment, anyone would be better off. It is far more likely that the bureaucratic ramifications of any such system would become a frustrating brake on that ingenuity and innovation which is the stuff of engineering. Thus, claims, counterclaims and

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ambiguity about who is, and who is not, an engineer look likely to continue. They will provide ample scope for continuing debate—and provide much of the intriguing challenge for comparative research. Note 1 In 1994, the ‘Japan Productivity Centre’ became the ‘Japan Productivity Centre for SocioEconomic Development’.

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Index

Abegglen, J. and Stalk, G. 97 age: and effectiveness in R&D 161–2; and fully-fledged engineer/scientist 159– 61; and graduation 158; and manager 159–61; and project leader 159–61 Akaoka, I. 106 Allen, G.C. 21, 22 Amano, I. 29, 66, 166 Amaya, T. 107–8 anti-industrial culture: and student career choice in Britain 62; in Japan 64–5; in late Victorian Britain 4–5 Aoki, M. 27, 92, 106 apprenticeship 58–9 Armytage, W.H.G. 25 Asahi, J. 56 Ashby, E. 25 Aso, M. and Amano, M. 24 Atoda, N. 71 Ayrton, W.E. 14 Azumi, K. 89 Azumi, K. and Hull, F. 124 Ball, Sir James 117, 119, 177 Banks, O. 12 Barnes, S.B. 183–4 Barnett, C. 12, 74 Barry, R., Bosworth, D. and Wilson, R. 64, 71, 72, 75, 119, 267 Bassett, P. 219, 241 Belderbos, R. 250 Berggren, C. and Nomura, M. 2 Berthoud, R. and Smith, D.J. 30, 64, 67 Bhasanavitch, D. 92 Big Bang 119 Blears, J. and Bonnet, B.J. 53 Boltho, A. and Hardie, C.J. 29 bonus, in Japanese pay system 95, 98–101 Bowden, Lord 33

Britain: educational system 5, 57–9; employment system 156–7; Japanese investment in the UK 218–22; labour market 90, 197–8; ‘Learning from Japan’ 216–18, 222–5, 247–8, 272–4; national system of innovation 114, 117–19; origins of engineering education 13–4, 19–21; professional institutions 204–5; unions 208–9 Broadbridge, S. 22 Brock, W.H. 15 Brown, K. 68 Brown, K.D. 9 brownfield sites 219 bubble economy 2 Buchanan, R.A. 21 Burns, T. and Stalker, J. 105, 186 Cairncross, D. 250 Campbell, J.C. 116 Cardwell, D.S.L. 74 career(s): 94–102; milestones 159–62; paths 161–2, 189; progress and mobility 261–2; timetables 157–62 CEPC (Committee of the Engineering Professors’ Conference) 72 Chandler, A.D. 16, 22–3 Chartered Engineer 59–62, 68 Checkland, O. 14, 16, 22 Child, J., Fores, M., Glover, I. and Lawrence, P.A. 12, 75 Chokki, T. 23 Chosu 16, 17 Clark, B. 12 Clark, G. 71 Clark, R. 104, 108 Cole, R. 168 Cole, R. and Yakushiji, T. 105

298

Index

collective voice 180, 204–9; see also professional institutions, unions. colleges of advanced technology (CATs) 30 communication: cross-cultural 246–9; in R&D work 147 company reporting 127 Connor, H. 176 Cooper & Lybrand Associates 81 Corfield, Sir Kenneth 49–51 Cotgrove, S. and Box, S. 183 Council for National Academic Awards (CNAA) 30, 72 cram schools: see juku, yobiko Crawford, S. 78 Cruickshank, M.J. 32 Cusumano, M. 117 Danford, A. 254 Darby, J. 222 Davis, S.T. 197–8 decision-making 138–9 Dees, B.C. 87 Deiters, R.M. 70 Delbridge, R., Kenny, M. and Lowe, J. 254 Department of Education and Science (DES) 51 Dicken, P., Tickell, A. and Yeung, H. 218 Divall, C. 14, 34 Dore, R.P. 10, 13, 104, 105, 109, 116, 155–6, 174, 197, 273 Dore, R.P. and Sako, M. 52, 81, 82, 93 Dyer, H. 5–6, 10–13, 14, 216, 274 Economic Planning Agency (EPA) 270 Edgerton, D. 42, 43, 44, 75 education system: outlined in Britain 54, 57–9; outlined in Japan 54–6 education: curriculum reform in Britain 71–2; curriculum reform in Japan 69– 71; engineering curriculum in Meiji Japan 15–17; industrial perspectives on reform 174–5; in Victorian Britain 14; vocational elements 54–8 Eindhoven Technical University 31 Elbaum, B. and Lazonick, W.O. 21 Ellis, N.D. 184 Eltis, W. and Fraser, D. 229, 235 Eltis, W., Fraser, D. and Ricketts, M. 177 employment: mobility 155; marketoriented and organisation-oriented systems 154–7

endaka (yen appreciation) 218 engineer(s): and service class 185; definitions 4, 19; expatriate 226; in France 124–32; national outputs 6, 46– 54, 79; prestige of study 64–8; registration 59–64; relations with managers 262–8; relations with blue collar workers 262–8; social standing 72–8; student ability 62–4 Engineering Careers’ Survey 225–8, 254 Engineering Council 32, 51, 60–2, 64, 75 103, 267 engineering dimension 71 Engineering Professors’ Conference (EPC) 44, 64 Engineers to Japan Scheme (EJS) 259 Ernst, A. 214 examinations 64–8, 69 Finniston: Committee of Inquiry into the Engineering Profession 49, 67; Report 30, 71, 75, 90, 93, 102–3, 174 Fitzpatrick Associates 218 foreign direct investment (fdi): and technology transfer 222–5; Japanese auto assemblers in the UK 234–7; Japanese investment in UK 217–25; Japanese office equipment makers in the UK 238–41; Japanese-owned heavy engineering in the UK 237–8; Japanese TV makers in the UK 229–34 Fores, M. 75 Fransman, M. 117 Freeman, C. 10, 114–15, 117 Fruin, M. 83, 253 Fujino, T. 255 Fukatake Shoten 66, 80 Fukusaku, Y. 186–7 Fukutani, M. 148–9 Funk, G. 181 gakkai (professional institutions); 214; see also professional institutions. genba (workplace) 43–4 Gerstl, J. and Hutton, S.P. 75 gijutsusha (engineer) 5, 48 Gillan, W.J. 93 Glinov, M. von, Driver, M.J., Brousseau, K. and Prince, J.B. 102 Glover, I. and Kelly, M.P. 74 Glover, I. and Tracey, M.P. 267 Gordon, A. 42, 109 Gospel, H. 59

Index

Grayson, L.P. 51 greenfield sites 219, 230, 241 Greenlees, J. 76 Gregory, G. 81, 92–3, 112–13 Guagnini, A. 34 Guest, D. 241 Halberstam, D. 27, 42, 105 Hamada, T. 245 Handy, C. 81 Hannah, L. 24 Hara, R. 105 Hasegawa, H. 229 Hazen, H.L. 87 Hendry, J. 110 hensachi (standard deviation test score) 39, 63, 65 hired foreigners 15, 31, 35 Hirschmeier, J. and Yui, T. 93, 109 Hitachi 1, 187, 230 Hofstede, G. 247 Honda 234 House of Lords Select Committee on Science and Technology 118–19 Hull, F.M. and Azumi, K. 124 Hull, F.M, Hage, J. and Azumi, K. 27, 105, 124 Hunter, J. 16 Imano, K. 131 Imazu, K. 22 Imperial College of Engineering (Tokyo) 2, 5, 12–13, 216 Imperial College of Science and Technology (London) 24, 29 IMS 51, 81 Inagami, T. 83, 100 Industrial Training Act (1964) 54 Industry Ventures 72, 178 Innovation Advisory Board (Department of Trade and Industry) 119 Inoue, K. 14 institutional rigidities 21 institutionalisation 4, 9–10 International Research Group on R&D Management 114, 126–30 Ishida, H. 203 Ishida, M. 95 Ishii, M., Yokoo, Y. and Hirano, Y. 121 Ito Hirobumi 16 Itoh, M., Kameyama, N., Lanciano, C., Maurice, M., Nohara, H. and Silvestre, J.J. 125

299

Iwakura mission 3, 35 Iwata, R. 18 Japan: educational system 54–7; employment system 156–7; Japanese investment in the UK 218–22; labour market 82–102, 106–8, 197–9; ‘Learning from Britain’ 11–13, 15–16, 253; national system of innovation 115–17; origins of engineering education 11–13, 15–19, 22; professional institutions 205–8; unions 208–9 Japan Inc. 112 Japan Institute of Labor (JIL) 270 Japanese employment system 19 Japanisation debate 216–18 JETRO (Japan External Trade Relations Organisation) 49, 219, 229, 250 Jinji’in Kyuuyo Kyoku (National Personnel Authority) 95–102 job satisfaction 198–204 Johnson, C. 27 joint-stock enterprise 18 Jordan, A.G. and Richardson, J.T. 72 JPC (Japan Productivity Centre) 132, 187, 269–70 juku (cram schools) 29, 62–3 jusen (housing loan companies): delay for the education budget 37–8; rescue controversy 2 Kakusho Gakko (miscellaneous schools) 56 Kaneko, M. 56 Kaplan, N. 183–4, 185 karakuri (craftsmen) 17–18 keiretsu 90, 108, 141 Kerr, I.H.F. 65 Kiba, T. 249–250 Kidd, J. 225 Kikuchi Kyozo 16 Kinmonth, E.H. 51, 74, 116 Kiyonari, T. and Nakamura, H. 103 Kobu Daigakko (Imperial College of Engineering) 14, 18, 21, 31, 40, 43 Kobusho (Ministry of Public Works) 15 Koike, K. 162–3 Kono, T. 104 Kornhauser, W. 182, 185 Koto Senmon Gakko: post-war technical colleges 56; pre-war higher technical schools 23

300

Index

Kurata, Y. 215 Kuwahara, Y. 106 Laciano, C. and Nohara, H. 125, 262 Lam, A. 124, 247 Lam, A. and Thurley, K. 168 Landes, D. 74 Lane, C. 59 Large, P. 256 late development effect 10 Lawrence, P.A. and Lee, R. 73 Lehmann, J.-P. 17–18 Levine, S.B. and Kawada, H. 19, 22 lifetime employment system 76–104 Lincoln, J.R. and Kalleberg, A.L. 243 Littler, C.R. 105 Lockyer, N. 40 Lorriman, J. 82, 92, 258–9 Lorriman, J. and Kenjo, T. 11, 258 Lynch, P. and Sims-Williams, M. 257 Lynn, L.H. 151, 246 Lynn, L.H., Piehler, H.R. and Kieler, M. 120 Lynn, L.H., Piehler, H.R. and Zahray, W.P. 170 Magota, R. 95 manpower forecasting 47 Manpower Services Commission (MSC) 51–2 Marcson, S. 182 Marsh, R. and Mannari, H. 95 Masaki Taizo 35 Massachusetts Institute of Technology (MIT) 34, 120 Matsushita 230 McCloskey, D. and Sandberg, L. 21 McCormick, B.J. and McCormick, K.J. 254 McKelvey, M. 115 McKinsey consultants 119, 177 Mechanics’ Institutes 32 Meiji: era 13, 28, 40, 62, 66, 115, 135, 166, 186, 216, 238; government 3, 13, 54, 138; restoration 3 Meiksins, P. and Smith, C. 263–9 Methe, D. 131, 186 Micossi, S. and Viesti, G. 219 Millerson, G. 19 Minkan 187 Misumi, J. 91–2 MITI (Ministry of International Trade and Industry) 26–7, 49, 70, 113–17

Mitsubishi Electric 230, 234 Mitsubishi Zaibatsu 19 mock test 65 Monbusho (Ministry of Education, Science and Culture) 39, 53, 69, 70, 71 Moorhouse, H.F. 119 Morikawa, H. 15–16, 19, 20, 23, 41, 44 Morioka, K. 76–7 Morris-Suzuki, T. 116 multi-divisional firm 24 Munday, M., Morris, J. and Wilkinson, B. 224–5, 254 Muta, H. 70, 178 Nakagawa K. 18 Nakajima, A. 108 Nakane, C. 92 Nakaoka, T. 44 Nakayama, S. 15, 187 National Economic Development Council (NEDC) 52 national innovation system 113, 114–19, 151, 154 National Institute of Science and Technology Policy (NISTEP) 121 National Personnel Authority (Jinji’in Kyuuyo Kyoku) 95–101 nemawashi (securing informal support) 243 nenko joretsu (seniority pay) 94–101 NIER (National Institute for Educational Research) 54 Nissan 234–5 Occupation of Japan 26 Odagiri, H. and Goto, A. 21, 26, 117, 134, 152 Ohashi, R. 76 Ohno, T. 268 Okamoto, Y. 105 Okayama, R. 23 Okimoto, D.I. 117 Okubayashi, K. 74 Okuda, K. 28 Oliver, N. and Wilkinson, B. 216, 217, 22–3, 225, 254 Osaka Boseki-sho Kabush Kaisha (Osaka Cotton Textile Company Limited) 18 Oshima, K. 49 Oshima, K. and Yamada, K. 107 OTA (Office of Technology Assessment) 270

Index

Palmer, J. 222 Papaanastassiou, M. and Pearce, R. 249, 255 Passin, H. 88 Patel, P. and Pavitt, K. 117, 118, 151 patents: among R&D workers 148–51 Pavitt, K. 102–3 pay: corporate pay systems 94–102; changing pay systems 197–8; Meiji engineers 19–20 Payne, P.L. 24 Percy, Lord Eustace 29 Plaza Accord (1985) 218 Poole, J.B. and Andrews, K. 25 Prais, S.J. 52–3 Prandy, K. 184–5, 205 professional institutions 19, 204–15; as learned societies 19; as qualifying bodies 19 professionalism 188–90 project organisation: in R&D 145–7, 194– 7; project responsibilities 195–6 publications: among R&D workers 190 Pucik, V. 85 R&D: at the corporate level 130–44; national level 114–19, 150–3; overseas 249–52 Rangaku (Dutch learning) 17–18 Rawle, P.R. 70, 116 Rebick, M. 96 recruitment: engineers 85–90, 260; R&D workers 155–62; in transplants in the UK 225–8 relative economic decline in Britain 1–3 reward systems 197–8 ringi-seido 243 Robbins, K. 13 Rodosho (Ministry of Labour) 98–9 Rohlen, T.P. 88, 91 Rosovsky, H. 21 Royal Fellowship of Engineering 259 Sakakibara K. and Westney, D.E. 89, 92, 122, 123 Sakamoto, T. 22 Sakauchi, F. 122 Sako, M. 254 salaries: surveys: Britain 75; Japan 73; and R&D productivity 149–50 Salusbury, T. 250 Sampson, A. 183 samurai 16, 18, 21, 35, 43

301

Sanderson, M. 25 Sanyo 230 SARTOR (Standards and Routes to Registration) 60–1, 68 Sato, H. 107, 157 SCAP (Supreme Commander Allied Powers) 26 Schonberger, R.J. 27 Scott, B.R., Rosenblum, J.W. and Sproat, A.T. 23 screwdriver plants 8, 17 seniority wage system 94–101 senpai-kohai 38, 91 Senshu Gakko 55–6 Shapira, P. 270 Shibusawa Eiichi 18 shiken jigoku (examination hell) 23 shin-jinrui (new age people) 108 Shirai, T. 103 Shiro, Y. 43 short-termism: and career planning 177; and corporate culture and finance 155 shukko (temporary job transfer) 107 Silver, A., Zussman, R., Whalley, P. and Crawford, S. 77 Sino—Japanese War (1894–95) 17 Skapinker, M. 256 Smith, C. 185 Smith, C. and Whalley, P. 260 Smith, P.B. and Misumi, J. 243 Snow, C.P. 183 sogo shosa (trading companies) 18 sokaiya (general meeting mongers) 2 Sony 187, 230 Sputnik 47 St. Simon, Henri, Comte de 3 Steven, R. 76–7 Storey, J., Edwards, P. and Sisson, K. 171–2 Strange, R. 230, 238 Strauss, A. and Rainwater, L. 182 Sugiura, T. 69 Sumiya, M. 21 Sumiya, M. and Taira, K. 43 Taisho era 24 Takagi, H. 92 Takeuchi, H. 17 tanki daigaku (junior colleges) 56 Technical Instruction Act (1889) 33 technical work: organisation and production 263–9

302

Index

Technische Hochschule 10, 13, 25, 30; influence in Britain 13, 31; influence in Japan 13 technocracy 112 technological gatekeepers 247–8 technology transfer 217–18 Tejima Seiichi 35 Temin, P. 21 tenseki (job transfer) 107 Thurley, K., Lam, A. and Lorriman, J. 123 TIT (Tokyo Institute of Technology) 26– 32 Toshiba 1, 2 Toyoda, T. 35 Toyota 234 Toyota Technical Institute 87 training: and job rotation 120, 170–1; initial training 167; mid-career training 167; off-the-job 162, 168, 171–3; onthe-job 162, 167–8; supervisor coaching 170; training reform 175; university attachment 171 transplants: auto assembly 234–37; companies in the UK 216–57; Japanese manufacturing TV plants 229–34; heavy engineering 237–8; office equipment 238–40 Trevor, M. 83, 107, 218 Tsuru, S. 14 Tsutsui, W.M. 273–4 TUC (Trades Union Congress) 49 Turney, J. 256 Uchida, H. 22 Ughanwa, D.O. and Baker, M.J. 230 UMIST (University of Manchester Institute of Science and Technology) Unequal Treaties 14, 22 UNESCO 52 unions 205–15 United Kingdom Atomic Energy Authority (UKAEA) 43 universities: development of the Imperial universities in Meiji Japan 17; universities in Japan—Tokyo 8; Tohoku 28, 114; Cambridge 24, 25, 67; universities in Britain—Imperial College of Science and Technology (University of London) 16, 17; Oxford

16; American-Japan comparative studies Cairnegie-Mellon 120; MIT 121 university reform: Occupation reform 26; University Council (Japan) reports 57, 71, 80 Veblen, T. 75 Von Tunzelmann, G.N. 45 Wada Koruko 36–7 Wagener, Gottfried 35–7 Wakasugi, R. 131, 187 Walker, W. 31, 117 War(s): 42; ‘Cold War’ (1948–89) 26, 43, 46, 48; First World War (1914–18) 22; Korean War (1951–53) 26; Second World War (1939–45) 25–6, 44, 47; Sino-Japanese War (1894–95) 17 Watson, H. 14, 44, 74 Wersky, G. 27, 81, 92, 103 Westney, D.E. and Sakakibara, K. 29, 123 Westney, D.E. 149, 187, 188, 215 Whalley, P. 78, 185 Whittaker, H. 272 Wiener, M. 12, 74 Williams, K., Haslem, C., Williams, J., Adcroft, A. and Sukdev, J. 224, 254 Williams, N. 250 Williams, P. 119, 177 work goals in R&D work 181–5, 188–90 working hours among R&D workers 191– 4 Yahata, S. 146–7, 153 Yamada, H. 187 Yamanobe Takeo 18 Yamao Yozo 15–16 Yasumura, K. 18–9 YKK 218 yobiko 63 Yonekawa, S. 18, 34 zaibatsu 15, 19, 36 Zussman, R. 23, 27, 44, 134, 141