EMERGING DYNAMICS OF
GLOBAL PRODUCTION
NETWORKS AND LABOUR
PROCESS:
A STUDY FROM INDIA
PRAVEEN JHA & AMIT CHAKRABORTY
JAWAHARLAL NEHRU UNIVERSITY
INTRODUCTION
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A significant restructuring of organization of production
under capitalism in last couple of decades,
Trans-nationalization of production with a major shift of
production base to low-cost developing countries.
The globalization of production in automobile industry,
accompanied by the progressive use of advanced
manufacturing technology (AMT) and lean production
techniques to organize production and work, has
epitomized this global changes.
This has transformed labour process and triggered
workers’ response.
The emerging dynamics of GPN and labour process -- a
dynamic interaction of capital’s strategy, technology and
agency of labour.
OUTLINE OF A THEORETICAL FRAMEWORK
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Capitalism, in Marxist understanding, as a spontaneous
system, driven by insatiable quest for surplus value or
profit.
Powerful impulses associated with the immanent
tendencies of capitalism -- described by Marx as the ‘laws
of motion of capitalism’– under substantial regulation in
the accumulation regime of post-WW II era.
Pressure on profit margin from late-sixties. Regulations
gradually withdrawn. A new regime of accumulation, i.e.
neo-liberalism.
Collective bargaining power of workers had to be broken
down (Harvey,2005).
Reserve army of labour in
developing world ensured low-wage regime for production
(Foster, 2010). Ascendency of GPN.
THEORETICAL FRAMEWORK CONTD…
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Labour process as the dialectic between immanent
tendencies of capitalism and agency of labour in the
production sphere.
Formal and real subsumption of labour under capital –
subsuming earlier modes of productions under capitalist
production to appropriate absolute surplus value; and
subsequent intensification of work by revolutionizing
production techniques to appropriate relative surplus
value.
Two contentious issues between capital and labour in
shaping labour process – how the organization of labour
serves the interest of the dominant class, and, how does it
facilitate overall control of the dominant class?
THEORETICAL FRAMEWORK CONTD…
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Braverman (1974) studies degradation of work, separation
between conceptualization and execution of work or the
operation of Taylorist principles under Fordist mass
production.
Marglin (1974) – technological and economic efficiency
aspired by capital.
Debates and divergence of different tendencies in postBraverman labour process theory. Some attempts to go
beyond shop-floor and connect labour process with the
perspective of larger political economy.
Need to develop a framework to capture the dynamics
between the emergence of GPN and the transformation of
labour process.
INDIAN AUTO INDUSTRY AND GURGAONMANESAR CLUSTER
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Import Substitution Industrialization till 1980s.
Significant restructuring thereafter, and rapid integration
with complex network of global auto production with
further liberalization in last two decades.
Gurgaon-Manesar cluster – a major destination of global
auto production with lead firms, global component
suppliers and deep backward linkages extending up to
slum production.
Increasing role of 1st tier suppliers to design and assemble
components according to the assembler’s specification,
adopt AMT and JIT or lean production, exploit economies
of scale. Joint ventures, mergers and just-in-time delivery
resulting in complex interdependence within cluster.
PRODUCTION PROCESS IN MARUTI SUZUKI
MANESAR PLANT
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Continuous flow of work from press shop to weld shop,
then to paint shop and finally in the assembly line.
Strong internal segmentation of workforce – permanent,
contract, trainee, apprentice, and even workers of vendor
companies working in the same premises.
Segmentation in terms of internal labour market.
Increasing mechanization and increasing intensification of
work, with sophisticated managerial control.
‘electronic flow’-management to reconcile technical
productivity and profitability, synchronizing supply chain
from extreme end to shop floor welding robots.
THE SUPPLY CHAIN
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With ‘no single source’ policy, and with 250-odd 1st tier
suppliers and hundreds of lower tier vendor companies, supply
is a seamless activity.
Lead firms like Maruti Suzuki not only outsource production
activities or stock of products, but financial risks.
Increasing polarization of suppliers – rise of global players in
the 1st tier for standardization and quality, and parallel
subsumption of low-wage labour intensive regime at bottom,
extending up to slum production.
Suppliers at the lower end of the chain facing two-fold squeeze
– from the lead firms or component assemblers who pressurize
for further cost-cutting to maintain their mark-up; and,
increasing price pressure for input( steel or rubber) -- very
limited scope to expand capacity. Consequence for labour.
MARUTI SUZUKI AND HINDUSTAN MOTORS:
JUXTAPOSING TWO PRODUCTION REGIMES
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Maruti Suzuki -- an
assembly plant producing
very few components, with
negligible inventory and
embedded in just-in-time
supply chain under GPN.
Value added depends on
increasing intensity of
work, i.e. relative surplus
value.
Internal segmentation of
workforce
or
internal
labour market substantial.
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Hindustan Motors – a
production plant producing
most of the components
including the forging or
foundry works representing
earlier production regime.
Scope to increase relative
surplus value is constrained
by labour process or
technology.
Segmentation or internal
labour
market
less
significant.
MARUTI SUZUKI AND HINDUSTAN MOTORS:
JUXTAPOSING TWO PRODUCTION REGIMES
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Experience is replaced by
professional training, ITI
diploma needed.
Centralized
production
system, AMT, ‘flexibility’ of
different kinds expand
scope
for
centralized
control, autonomy of floor
managers reduced.
‘Manufacturing
consent’
for technological change or
productivity
rise
---production
incentive,
quality circles, Japan visit.
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Experience over time on the
shop floor is important. Few
with ITI diploma.
Less ‘flexible’. Increase of
speed of ‘car line’ may lead
to fall of quality, more
breathing space for workers.
More autonomy for floor
managers.
Hegemonic control is not so
significant. No provision of
production incentive.
GURGAON AUTOMOBILE CLUSTER: THE
STRUCTURAL UNEVENNESS
‘Unity of opposites’ embedded in ‘combined and uneven
development’- Within the ‘modern’ firm -- sophisticated mechanization
with brutal use of cheap labour;
 Along the supply chain -- lower segment co-opted to
produce more absolute surplus value for assemblers;
 Regional unevenness – old industrial areas (e.g
Faridabad) including workers’ jhuggis subsumed under
new regime.
GURGAON AUTOMOBILE CLUSTER: THE
STRUCTURAL UNEVENNESS
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Siphoning of surplus and transfer of crisis -Within factory -- internal segmentation within the
workforce increasing contractualisation and intensification
of work (e.g. post-2008 Maruti);
Opening new unit with less bargaining power of workers
(e.g. Maruti Suzuki Manesar plant B);
Along supply chain – cost-cutting, financial risk transfer,
burden of over or under-capacity production
Use of reserve army of labour in periphery of production.
ISSUES OF TECHNOLOGY
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Two important dimensions of technological change – a capitalcapital (competition among capitalists) one; and, a capitallabour (class domination and control) one.
Technology not ‘exogenous’ to labour process’, neither a ‘blackbox’.
Technological changes – incremental changes in the shop
floor; adoption of AMT.
Mechanization of three different processes of production (Bell,
1972, Blackburn et al. 1985) – transformation, transfer and
control.
Technology in GPN has revolutionized the process of control,
both on individual machines and on other two processes, and
made labour process amenable to different ‘flexibilities’.
ISSUES OF MANAGERIAL CONTROL AND
WORKERS’ AUTONOMY
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In the upper strata of production network, larger
participation of a section of workers encouraged to use
their tacit knowledge of labour process to streamline and
intensify their work. Re-linking conception and execution to
a limited sense (e.g. linking CAD-CAM) for the same.
With sophisticated managerial control, more intensified
form of Taylorism.
A rising clash of Technocratic logic and democratic logic.
Social hierarchy reproduced on the shop floor.
Various socio-cultural-religious forms are used to assure
hegemonic control over the workers.
ISSUES OF SKILL
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Question of skill to be understood with many-fold
dimensions like craft-input, know-how, experience,
valuation etc.
General decline in terms of craft input.
Know-how increases or decreases depending on the
nature of technological change or reorganization of
production influencing labour process.
Experience less important as easily replicable by training
and ‘devalued’ because of continuous transformation in
labour process due to technological changes.
Possession of ‘devalued’ skill due to technological shifts
causes lack of confidence and increases job insecurity.
WORKERS’ RESPONSE
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Strike waves in last couple of years in automobile industry in
Gurgaon-Manesar cluster and beyond (including militant
strike and occupation in Maruti Suzuki Manesar plant in
2011 in three phases). Outside India, similar trends in other
developing countries (e.g. China, Mexico) visible.
Important dimensions –
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Most often deeply grounded in labour process, concrete
experience of shop-floor working conditions.
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Spontaneous in character, solidarity of permanent and
contract workers.
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Use of strategies that go beyond traditional legal trade
unionist framework – factory occupation, solidarity strikes.
WORKERS’ RESPONSE
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Old trade union form undermined by capital due to shifting
work organization, new technology and redesigning of job,
increased mobility of capital, increasing contractualisation
and Informalisation. Embryonic form of plant-level workers’
self-organization visible in struggle.
Exposing a new kind of vulnerability of firms under GPN by
paralyzing the production chain (e.g. Rico strike, 2009,
Maruti Strike 2011).
Participation of a new young, militant, skilled workforce,
due to a transition from formal to real subsumption of
labour under capital, from appropriation of absolute
surplus value to relative surplus value in labour process in
the new assembly points and clusters under GPN.
CAPITAL’S STRATEGIC RESPONSE
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Crush the movement and go for the necessary
restructuring of work, technology and production process
to undermine workers’ strength in the long run (e.g. Maruti
strike in 2000, Rico strike in 2009).
If not possible then try to contain the movement, transfer
the crisis and go for gradual restructuring to undermine
workers’ resistance. E.g. Maruti Suzuki strike in 2011
where a forced compromise to accept many demands
leads management for immediate transfer of crisis via
supply chain, plant B, to adopt ITIs, and go for gradual
restructuring.
CONCLUDING REMARKS
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Vulnerability of workers under GPN on the rise globally.
Global South struggling against low-wage regime, against
harsh working condition, for unionization. Workers of
global North facing wage-cuts, job-cuts, casualisation.
With the ascendency of GPN, share of wages in total
output falling.
Promises of workplace democracy, autonomy, reskilling do
not seem to deliver much.
When ‘modern’ segment in the production network feeds
on the existence of a low-wage, labour-intensive,
CONCLUDING REMARKS
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technologically backward segment, embedded in a
combined and uneven development, unilinear ideas of
‘social’ or ‘technical’ upgrading in the production network
do not hold.
There seems to be a potential threat for many part of the
production chain in GPN to be converted into radical
chain, but the form and strategy of labour vis-à-vis global
capital is still an open question.