The study of organisational networking has suggested that a joint effort applied to some task is often to the advantage of both parties. Recent studies have indicated that many strategic networks of Japanese firms have been both strategic and also permeable – to the extent that each firm takes on some of the characteristics of the other in order to fulfil a task. However the emergent characteristic of ‘downsizing’, which hit the Western firms a decade ago, has now moved to Japan where their reluctant human resource managers have begun to ‘hollow out’ their workforce – and much of the effect falls upon the middle management cadre. In turn we are seeing in Europe, across the Japanese production subsidiaries, that they have embraced the precepts of Enterprise Resource Planning (ERP) in the form of applications programmes promoted by SAP, Oracle, Baan, PeopleSoft and others – so as to be better informed of the data in their pan-European enterprise. Our thesis is that the effects of the hollowing out needs to be very carefully managed in both the single enterprise and between multi-enterprises. And the implementation of ERP needs precise management in multi-national firms in general, and Japanese firms in particular, if they are to engage in strategic networking with any degree of permeability – since they will have little resultant organisational slack to generate new organisational learning.
Measuring network rewiring over time