ABSTRACT
As companies find themselves competing in markets characterized by differentiated products, high standards of product quality, rapid development of new products, and quick delivery of finished goods, improvements in productivity and reductions in costs depend critically on the nature of the production system and on human resources. The decision to transform the basic organization of production from a system based on the principles of mass production and Taylorism to one with an entirely different organizational logic may be critical to the ability of the United States to maintain a strong presence in manufacturing and producer services, particularly in traditional industries. In the 1990s, production capacity is as much a matter of investment in work organization and worker skills as it is of additions to the capital stock.
