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THE STRUGGLE OVER HUMAN RESOURCE DEVELOPMENT: INTEGRATING THE SOUTH AFRICAN AUTO INDUSTRY INTO THE INTERNATIONAL ECONOMY

While pressures of intensified competition are assumed to be ubiquitous in the auto industry, in a developing country like South Africa, where the industry is protected by tariff barriers and export activity is limited, international productivity standards have only had a limited impact. The South African case is distinguished by the leading role of organized labor to transform an isolationist domestic assembly industry into a world-class competitor. The transformative vision of the National Union of Metalworkers of South Africa (NUMSA) has shaped the context in which auto assemblers have been able to reorganize and develop competitive strategies. NUMSA initiated and concluded industry level agreements on work reorganization, pay-for-skills, portable industry-wide modular training, career-pathing and multi-skilling (including adult literacy training), and reinforced these agreements through powerful shopfloor organizations that have challenged racially exclusive, authoritarian management regimes. Evidence from three cases suggests great diversity in the depth of diffusion of innovative practices. It is argued that, following decades of international isolation, the extent to which firms are competing in export markets or are being reintegrated into global commodity chains is influencing the diffusion of international best practice. Subsidiaries of foreign multinationals, which are themselves exposed to international competitive pressures, are more likely to adapt strategies aimed at adopting world class human resource management practices. Because of the strong NUMSA presence on the shopfloor, diffusion is more likely if the union and management have compatible strategies. While the auto industry agreements, which embody a framework of principles formulated by the union movement, constrain managerial choice, the specificities of ownership patterns, product market strategies and the local balance of power between the union and management all help to shape a distinctive configuration of lean production techniques in each plant. This evidence suggests it is premature to draw any conclusions about the sequence, pattern or depth of diffusion of innovative techniques in the industry.