Abstract

This paper is a contribution to the body of literature on the Japanese management techniques known as kaizen, or continuous improvement technologies. The topic is introduced with a brief review of the findings of several studies on kaizen and the experience of Japanese firms in transferring the kaizen technologies abroad, followed by an analysis of the process of endogenous technological change within the context of continuous improvement. It is argued that global versions of the CIF are subject to unique systemic problems, including: (1) a persistent increment to the cost of maintaining standardized processes; (2) a reduction in the rate of improvement creation due to a loss of synergism; (3) an increase in the time required to implement improvements, and reduced effectiveness of installed improvements; and (4) a likelihood that some improvements will fail to enhance customer value in markets other than the ones in which they originate. The widely varying experiences of the Japanese CIFs in transferring the continuous improvement technologies abroad are attributed, at least in part, to these internal systemic weaknesses of the global CIF. Furthermore, it is concluded that the strategic advantage of a globally dispersed CIF is reduced below that of a geographically concentrated CIF.

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