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This article examines the use of subcontracting as a manufacturing strategy while focusing particularly on the associated operational issues. Within a vertically integrated supply chain a single enterprise retains ownership and/or control over the others. This can be achieved by merger, or other form of formal corporate alliance with enterprises elsewhere in the chain, and does not normally make use of subcontract arrangements with independent organizations. By contrast, within a vertically disintegrated supply chain, production can be subcontracted down through a series of levels from the original principal to several independent enterprises. The subcontracting of manufacturing activity is an integral part of manufacturing strategy within this model of the supply chain. Between these two extremes a continuum of intermediate approaches exists. It has been reported that the use of vertically disintegrated production is more widespread in Japan than it is in Great Britain, and that its use is a contributory factor in the continuing success of Japanese industry.

Japan is perceived in most advanced countries as the world leader in the introduction and exploitation of new management practices, particularly in the area of manufacturing. In an attempt to match Japan's economic progress other countries are seeking to introduce many of the systems which are believed to be the basis of Japanese success. In this article, certain aspects of a UK manufacturing company which had adopted a number of practices following studies undertaken in Japan, is compared with a Japanese owned company located in the UK. [ABSTRACT FROM AUTHOR]

The article discusses the Japanese style of production management in Great Britain. The main method used for studying Japanese management in Britain is by obtaining workers' perceptions. Information has been obtained both by means of personal interviews and be self-completion questionnaires, from one medium-sized Japanese factory and from two smaller factories. At the supervisory level, a distinction generally regarded as important is between close and general control over work. Close supervision involves maintaining continuous contact with the production line, so that the individual worker's performance is visible to the supervisor most of the time, while general supervision involves greater emphasis on planning and other activities off the shop-floor. Supervisors in the Japanese-owned factories seemed to be required to work in both of these modes. Great attention was paid to the planning and organization of work, yet there was also great emphasis on close involvement with the production line or section.