Agile against Lean: An Inquiry into the Production System of Hyundai Motor, by Hyung Je Jo, Jun Ho Jeong and Chulsik Kim

In the first two decades of the 2000s, Hyundai Motor (HM) 1 became a shooting star in the automobile industry.The company quickly grew to become the world's third-largest carmaker, behind Toyota and Volkswagen.This book analyses the factors that contributed to this successful development.Its title, Agile against Lean, harks back to the debate about production systems initiated in the early 1990s by James Womack and colleagues, who declared the lean production system exemplified by the Toyota production system (TPS) to be the best system for the future. 2This claim was contradicted by researchers and industry players alike.In the United States, as Hyung Je Jo, Jun Ho Jeong and Chulsik Kim describe, an industry-led consortium developed an alternative model centred on agile production; they argued that, building on American strengths, this would better meet the challenges that industry would face in the future.Characteristic features of this model were flexible cooperative arrangements within and between companies, diffused authority structures and a skilled workforce that could be flexibly deployed to allow companies to rapidly respond to changes in external conditions.Although HM, like almost all the Western car makers, introduced lean production practices during the 1990s, after the Asian financial crisis the company took measures that, according to Jo, Jeong and Kim, led to a new kind of agile production system.This system, which they regard as the driving force of the company's successful development, differs fundamentally from the American agile system concept.The basic characteristic of the HM production system, according to the authors, is its combination of the contradictory elements of authoritarianism and experimentalism.This review begins by looking at the element of authoritarianism.This element is rooted in the system of family-led chaebols in the Republic of Korea.Chaebol leaders usually have substantial discretionary power, which enables them to mobilize resources and reconfigure organizational structures quickly and without having to compromise with other stakeholders.The system was hit hard by the Asian financial crises, but the remaining chaebols, such as HM, were revitalized through modernization and reform.On 1 Formally known as the Hyundai Motor Group, HM was formed after the takeover of Kia. 2