Global Operations of Japanese MNEs’ Hybrid Factories: Management Geography Framework

Abstract

In this work, we try to illuminate and analyze the global overall situation of the different types of “hybrid factories” of Japanese firms, the mixture between Japanese and local management and production systems, in the major regions of the world, using our management geography approach. We, the Japanese Multinational Enterprise Study Group (JMNESG), have developed the concept of hybrid factory and undertaken large-scale field studies since the early 1980s in North and South America, East and South Asia, and Western and Central — Eastern Europe. This research focuses on five main issues. First, we give a brief explanation on the theoretical framework of our management geography approach. We suggest that various business/management models based on socio-cultural differences are closely connected to those of geographical locations along with historical contexts, and such differences are one of the essential factors determining the comparative or competitive advantage of industries or nations. Second, we look at typologies of different patterns of the “hybrid factory” (mixture of parent factory and local factory) by region. Third, we discuss the dynamic directions of various locational patterns of hybrid factories from one region to another. We examine whether there is divergence or convergence. Fourth, we analyze the strategic implication of different patterns of hybrid factories for the global management of Japanese or foreign firms in terms of performance such as efficiency, quality, and profitability. Lastly, we give our concluding remarks regarding what type of Japanese hybrid factory is appropriate for a specific local condition of management environment and market.