Lean and Mean: The Changing Landscape of Corporate Power in the Age of Flexibility, by Bennett Harrison
Block, Fred
LEAN AND MEAN: THE CHANGING LANDSCAPE OF CORPORATE POWER IN THE AGE OF FLEXIBILITY, by Bennett Harrison. Basic Books, 1994. 324 pp. $25.00. One of the fault lines within political economy is...
...With its theatrical metaphor the passage suggests not just that the large corporations are serious actors, but that they are producing and directing a coherent performance...
...In fact, they are singing different songs...
...Steel, 566 • DISSENT General Motors, and AT&T were not only powerful but secure...
...If he were consistent in arguing that large firms are still dominant, he would see this alternative development strategy as utopian...
...For example, Daniel Bell—one of the leading theorists of discontinuity—in "Downfall of the Business Giants" (Dissent, Summer 1993) argued that the giant bureaucratic firms are no longer able to compete successfully against smaller, more agile firms that are better able to take advantage of rapidly developing technologies...
...The latter argue that big changes are occurring and that our conceptual frameworks need to be revised accordingly...
...In contrast, radical theorists of discontinuity argue that new circumstances provide opponents of capitalism with opportunities if they are willing to adopt new analyses and strategies...
...To be sure, Microsoft's feat of transforming itself in a few years from a tiny IBM subcontractor into its most powerful rival is highly unusual, but the story does point to the fluidity and uncertainty of these new arrangements...
...In trying to figure this out, we will be able to make good use of the evidence that Harrison has amassed on both sides of the question...
...Previously, high levels of vertical integration contributed to the power and security of the largest corporations...
...He is scathingly critical of the widely quoted claims that small businesses create most of the new jobs in the United States...
...The contrast with the 1950s could not be sharper...
...Although Harrison is contemptuous of theorists of discontinuity who imagine either a collapse of corporate power or some kind of "postindustrial" transformation of the economy, he does believe that the strategies of large corporations have changed to accommodate international competition...
...This part of Harrison's argument is an important corrective to those of us who imagined that as the means of production became more widely diffused, the size of production units would fall...
...Amid this "imagined continuity" and imagined discontinuity," nothing is harder than to define what is really new in our current circumstances...
...all that changes are the strategies they use to attain this domination...
...Usually when political economists invoke a "new stage of capitalism," they are suggesting that there are certain phenomena that characterize the new stage...
...The strength of his account is the reminder that giant corporations continue to exert extraordinary power, but he fails to place this in the proper perspective...
...Harrison's argument about the continuity of corporate power misses what is new in our situation and exaggerates the degree to which the global economy is subject to conscious control...
...At this point, his argument joins that of others who have contrasted the short-term thinking of U.S...
...The metaphor would be more accurate if it recognized that diverse corporate actors have usurped the stage without any sense of the nature of the production...
...The high road involves long-term cooperative relations with suppliers and substantial investments in the training of the core work force...
...Michael Piore and Charles Sabel, two admirers of industrial districts, have argued that regions should pursue economic development strategies that are independent of large corporations...
...new competitors faced overwhelming barriers to entry, and established competitors knew better than to push too hard...
...Moreover, this "new stage" argument is further complicated by Harrison's repeated contrast between firms that choose the high road of networked capitalism and the low road...
...A giant movie studio can find itself ruined by a string of box-office disasters...
...For every IBM in decline, he suggests that there is a Microsoft or Intel in the ascendancy...
...Instead, he waffles and offers no real analysis of which path will be taken in this new stage...
...He demonstrates that the recent enthusiasm for "industrial districts" that are based on cooperation among small entrepreneurial firms has ignored the role that giant corporations often play in such regions...
...But after berating these authors for failing to understand that large corporations will inevitably play a critical role in these industrial districts, Harrison ends up embracing their choice of policies...
...firms with the longer term thinking of corporations in Japan and the European Community...
...Lean and Mean: The Changing Landscape of Corporate Power in the Age of Flexibility is primarily an analysis of the large corporation...
...The greater use of alliances and subcontracting is part of this story of increased vulnerability...
...Harrison, however, is caught by his indecision between continuity and discontinuity...
...A firm such as Nike—which lacks any of its own production facilities—lives or dies by the quality of its advertising and the trendiness of its latest shoe design...
...Even Microsoft understands that a failure to stay ahead of the competition in developing the next generation of computer operating systems could destroy the firm...
...But now, when a large automobile firm subcontracts with dozens of technologically sophisticated smaller firms to keep up with competitive pressures, it is operating in a trickier environment...
...Even if their leaders know that more government spending on infrastructure and employee skills will ultimately benefit them, they see no choice but to fight for more corporate tax breaks and less government regulation...
...firms play suppliers off against each other and squeeze labor and training costs to the minimum...
...The former argue that current institutions are a continuation of the past with only superficial changes...
...The value of Harrison's book is that his confusion forces us to think very seriously about this issue of continuity and discontinuity...
...Firms that are under this kind of pressure simply cannot afford to take a long-term view...
...Dressed in new costumes, and armed with techniques for combining control over capital allocation, technology, government relations, and the deployment of labor with a dramatic decentralization of the location of actual production, the world's largest companies, their allies, and their suppliers have found a way to remain at the center of the world stage...
...The difficulty that Harrison has in being able to sort out the extent of continuity and discontinuity is not his problem alone...
...If he argues that the high road is the path of the future, then he would clearly be joining the theorists of discontinuity in suggesting that we are entering a kinder and gentler phase of capitalism...
...And he notes with satisfaction that the once controversial claims that he and Bluestone made about growing income inequality in the United States are now accepted as true by most analysts...
...This division does not align with a left-to-right political axis...
...He concedes that the more rigid large firms have declined, but he argues that giant, multinational firms are tightening their control over the world economy...
...The first is a weak and contradictory set of policy recommendations...
...Radical theorists of continuity argue, for example, that despite the apparent changes in capitalism, it is still the same system of class oppression...
...The insecurity of even the largest corporations is shaping our political life...
...Harrison suggests that this corporate networking represents a new stage of capitalist development...
...As in his earlier books written with Barry Bluestone, The Deindustrialization of America and The Great U-Turn, Harrison emphasizes the destructive effect on workers and communities of the low-road strategy...
...The increased vulnerability of these performers has led them to improvise wildly—often at cross purposes...
...Today even the most successful firms are often unable to block new competitors, and the corporation's fate can hang on the quality of its most recent marketing decisions...
...This inability to resolve the tension between continuity and discontinuity creates two additional problems...
...They argue that this is a promising alternative to the standard efforts of local governments to encourage large firms to build facilities in their localities with generous tax breaks and other perks...
...If he takes the opposite view and sees meanness as the wave of the future, then all of the talk about alliances and investing in employees would be reduced to a minor footnote...
...there are conservative and radical versions of both theories...
...In the culture industry, for example, despite the fact that the technical means to make movies or produce books are widely diffused, a handful of giant corporations still dominate through their control over advertising and distribution...
...As Bill Clinton has learned in the battle over health care, very few corporate leaders can be relied on to advocate measures that will obviously contribute to greater efficiency in the long term...
...In their view, efforts by local governments to raise employee skill levels, provide infrastructure, and encourage cooperation among small firms could stimulate job creation and economic growth...
...The second aspect is the tendency for giant corporations to build strategic alliances with each other and with groups of smaller firms, including the firms that are the heroes of the industrial district story...
...After spending much of the first half of the book criticizing scholars who view industrial districts based on small entrepreneurial firms as the wave of the future, Harrison ends up adopting many of their policy recommendations...
...But Harrison also insists that the largest corporaFALL • 1994 • 565 tions continue to dominate the world economy...
...Yet, Harrison misses the related point that in this era of alliance capitalism in which the technical means of production in many industries are widely diffused, even the largest corporations live with instability and insecurity...
...At the beginning of the book, he writes: I am suggesting that the emerging global economy remains dominated by concentrated, powerful business enterprises...
...Back then, firms such as U.S...
...One aspect of this change is the turn to leanness—concentrating on a firm's most profitable lines, reducing the number of core employees, and greater reliance on contingent workers and subcontracting...
...This is precisely what one would expect from a theorist of discontinuity...
...One of the fault lines within political economy is between theorists of continuity and theorists of discontinuity...
...Bennett Harrison has written a book that defies easy categorization: he combines both types of positions in a way that is sometimes illuminating and sometimes unsatisfying...
...Much of our political and cultural rhetoric now centers on questions of continuity or discontinuity—think of Ronald Reagan's invocations of cultural nostalgia or Bill Clinton's claim to be a "New Democrat...
...Similarly, while the advances of microbreweries that produce high quality beers have been widely heralded, the beer industry continues to be dominated by three or four giant firms...
...By looking at the famous industrial districts of Italy he provides persuasive evidence of control by large firms...
...Harrison presents a powerful critique of this argument...
...Although Bell does not suggest where this tendency might lead, others have concluded that the economy will soon consist of many small and medium-sized firms that are unable to exert the market power of the great corporate empires...
...The decline of such firms as IBM, General Motors, and Sears has led some commentators to suggest that the era of the giant corporation might be over...
...The low road is lean and mean...
...The second problem is that Harrison's framework does not allow him to analyze the political dynamics of this system...
Vol. 41 • September 1994 • No. 4
