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Fordism and Post-Fordism
Transcript of Fordism and Post-Fordism
Born July 30, 1863, near Dearborn, Michigan.
Created the Ford Model T car in 1908 and went on to develop the assembly line mode of production
Hired as an engineer for Edison Illuminating Company and was promoted to chief engineer
Constructed many models of cars; in 1903, he created the Ford Company
Sponsored the development of the moving assembly line technique of mass production.
Introduced the $5-per-day wage as a method of keeping the best workers loyal to his company.
Ardent pacifist and established the Ford Foundation to provide ongoing grants for research, education, and development
Died April 7, 1947
What is Fordism?
Fordism is a highly organized and specialized system for organizing industrial production and labor. Fordist production features assembly-line production of standardized components for mass consumption.
Allowed for the inexpensive production of consumer goods at a single site on a previously unknown scale
What is Post-Fordism?
Post-fordism is now a world economic system characterized by a more flexible set of production practices in which goods are not mass-produced, but instead, production has been accelerated and dispersed around the globe by multinational companies that shift production, outsourcing it around the world and bringing places together in time and space than would have been imaginable at the beginning of the twentieth-century.
Explain how Fordism affected the economy industry during the 19th and 20th century; and how Post-Fordism is affecting the industry today.
1. Serves as an industrial example: involves mass production of standardized goods on a moving assembly line
2. As a national accumulation (or growth) regime: involves a virtuous cycle of mass production and mass consumption
3. Mode of Regulation: comprises an institutionalized compromise between organized labor and big business; monopolistic competition between large firms; centralized financial capital, deficit finance, and credit-based mass consumption; state intervention to secure full employment and establish a welfare state, and the embedding of national economies in a liberal international economic order
4. Form of social life: characterized by mass media, mass transport, and mass politics. Fordist mode of growth became dominant in advanced capitalism during postwar reconstruction and is often credited with facilitating the long postwar boom
Economies of scale produced by spreading fixed expenses, over larger volumes of output, thereby reducing unit costs. (WALMART)
Economies of scope produced by exploiting the division of labor by combining specialized functional units, especially overheads such as reporting, accounting, personnel, purchasing, or quality assurance so that it is less costly to produce several products than a single specialized one. (MCDONALDS)
Engendered a variety of public policies, institutions, and governance mechanisms intended to mitigate the failures of the market, and to reform modern industrial arrangements and practices
Automobile Industries in the 19th to the 20th century: The Ford Motor Company was one of several hundred small automobile manufacturers that emerged between 1890 and 1910. After five years of producing automobiles, Ford introduced the Model T, which was simple and light, yet sturdy enough to drive on the country's primitive roads. The mass production of this automobile lowered its unit price, making it affordable for the average person. Furthermore, Ford substantially increased its workers' wages. These factors led to massive consumption. In fact, the Model T surpassed all expectations, because it attained a peak of 60% of the automobile output within the United States.
Example of Fordism
Japan: Post-World War II changes in production in Japan that caused post-Fordist conditions to develop.there were changes to company structure, including the replacement of independent trade unions with pro-management, company-based unions; the development of a core of permanent male multi-skilled workers; and the development of a periphery of untrained temporary and part-time employees, who were mostly female.
Example of Post Fordism
New information technologies are important
Products are marketed to niche markets rather than in mass consumption patterns based on social class
Service industries predominate over manufacturing
Work force is feminized
Financial markets are globalized
A practical Application that is still being used today such as a factory assembly line for bottling of ketchup, mustard, and salsa.
A practical application would be the manufacturing of cars in which the different components are made in different places but eventually come together for the finished project.
helped produce many goods at a single site--known as mass consumption--by a technique called assembly line very inexpensively
helped set a political-economical structure that supported mass production by corporations
Post fordism allows different parts of a whole to be produced in different places around the world and then brought together to meet market demand.
Production Cycle Time
Product Life Cycle
Regional / National
Vertical or horizontal integration
Monthly / Weekly
Weeks / Months
Outsourcing and offshoring
Daily / Real-Time
Innovation / Knowledge / Network
In a Fordist production system, parts are produced, built, and made into a whole in one vicinity and then shipped to some place else to be used. he transport function in such an environment is relying on economies of scale with delays at transfer points such as ports and rail yards.
In a Post-Fordist environment, supply chain management tends to "reduce the need for warehousing and increase the integration between elements of the value chain in a complex network of relationships" (e.g. outsourcing). Parts of the whole adapt to constant fluctuations in the amount, origins and destinations of cargo flows. The transport function is closely integrated to production and distribution and is the main element minimizing delays and warehousing.