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From Individual Skills to Organizational Capability in Japan

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  • Sako, Mari

Abstract

Two contrasting conceptualizations of skills lead one to attribute different roles to inter-firm networks. If skills are regarded as a public good, then inter-firm networks are like clubs that police the scope for firms to benefit from skills without paying for their acquisition. By contrast, if skills are regarded as a distinct and hard-to-imitate asset, then inter-firm networks provide an essential non-market mechanism for spreading it. The problem in the former conceptualization is market failure due to the ease of spill-over of knowledge, while the counterpart problem in the latter conceptualization is the difficulty of diffusing tacit knowledge by market mechanisms. This paper describes Toyota Motor Corporation's supplier development programmes in the wider industrial context of Japan. It concludes that of the two perspectives, the knowledge-as-a-distinctive-asset perspective is more appropriate in understanding the rationale behind the elaborate mechanisms for developing suppliers in the long term. Copyright 1999 by Oxford University Press.

Suggested Citation

  • Sako, Mari, 1999. "From Individual Skills to Organizational Capability in Japan," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 15(1), pages 114-126, Spring.
    • Handle: RePEc:oup:oxford:v:15:y:1999:i:1:p:114-26
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    Cited by:

    1. Wagner, Stephan M., 2006. "A firm's responses to deficient suppliers and competitive advantage," Journal of Business Research, Elsevier, vol. 59(6), pages 686-695, June.
    2. Mark Rogers, 2000. "Understanding Innovative Firms: An Empirical Analysis of the GAPS," Melbourne Institute Working Paper Series wp2000n08, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    3. Tomas Fernandez-de-Sevilla, 2011. "Responses to a crisis: FASA-Renault in Spain during the 1970s," Working Papers in Economics 261, Universitat de Barcelona. Espai de Recerca en Economia.
    4. Meagher, Kieron & Rogers, Mark, 2004. "Network density and R&D spillovers," Journal of Economic Behavior & Organization, Elsevier, vol. 53(2), pages 237-260, February.
    5. Naoki Ando & Dong Kee Rhee & Namgyoo Park, 2008. "Parent country nationals or local nationals for executive positions in foreign affiliates: An empirical study of Japanese affiliates in Korea," Asia Pacific Journal of Management, Springer, vol. 25(1), pages 113-134, January.
    6. Belderbos René A. & Heijltjes Mariëlle G., 2003. "The Determinants Of Expatriation In Japanese Multinationals: Vertical Business Groups And Executive Staffing Policies In Asia," Research Memorandum 055, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    7. Phan, Anh Chi & Abdallah, Ayman Bahjat & Matsui, Yoshiki, 2011. "Quality management practices and competitive performance: Empirical evidence from Japanese manufacturing companies," International Journal of Production Economics, Elsevier, vol. 133(2), pages 518-529, October.

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