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Strategy Meets Institutions: The Transformation of Management-Labor Relations at Deutsche Telekom and Ntt

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  • Mari Sako
  • Gregory Jackson

Abstract

This comparison of labor-management relations at Deutsche Telekom (DT) and NTT Group (formerly Nippon Telephone and Telegraph) demonstrates the value of considering both institutions and strategic decision-making to understand the interaction between companies and unions. As corporations diversify, multi-divisional or holding company structures emerge, but the degree of diversity introduced in employment relations within the corporate group depends on the interaction between corporate strategy and the strategy of organized labor. The authors' field research, based on interviews with managers and labor leaders, shows that despite a broadly similar corporate strategy of diversification by DT and NTT after the liberalization of telecommunication markets, employment relations became more decentralized—both for unions and for works councils—within the DT group than within the NTT group. This difference in outcomes is explained by the relative power and strategic choices of labor and management, rather than by constraints and opportunities specific to the existing national institutions.

Suggested Citation

  • Mari Sako & Gregory Jackson, 2006. "Strategy Meets Institutions: The Transformation of Management-Labor Relations at Deutsche Telekom and Ntt," ILR Review, Cornell University, ILR School, vol. 59(3), pages 347-366, April.
    • Handle: RePEc:sae:ilrrev:v:59:y:2006:i:3:p:347-366
    DOI: 10.1177/001979390605900301
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    References listed on IDEAS

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    1. Hideshi Itoh, 2003. "Corporate Restructuring in Japan Part I: Can M‐Form Organization Manage Diverse Businesses?," The Japanese Economic Review, Japanese Economic Association, vol. 54(1), pages 49-73, March.
    2. Richard R. Nelson, 1991. "Why do firms differ, and how does it matter?," Strategic Management Journal, Wiley Blackwell, vol. 12(S2), pages 61-74, December.
    3. Thomas Kirchmaier, 2003. "Corporate Restructuring and Firm Performance of British and German Non-Financial Firms," CEP Discussion Papers dp0582, Centre for Economic Performance, LSE.
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    Cited by:

    1. Ian Greer & Thorsten Schulten & Nils Böhlke, 2013. "How Does Market Making Affect Industrial Relations? Evidence from Eight German Hospitals," British Journal of Industrial Relations, London School of Economics, vol. 51(2), pages 215-239, June.
    2. Andreas Kornelakis, 2016. "Inclusion or Dualization? The Political Economy of Employment Relations in Italian and Greek Telecommunications," British Journal of Industrial Relations, London School of Economics, vol. 54(2), pages 385-408, June.
    3. Michalski, Hans-Jürgen, 2015. "Der Wandel der Telekommunikationsindustrie im 21. Jahrhundert: Eine international vergleichende Analyse der Unternehmensstrukturen und -strategien weltweit führender Telekommunikationskonzerne," Study / edition der Hans-Böckler-Stiftung, Hans-Böckler-Stiftung, Düsseldorf, volume 127, number 296, March.
    4. Uschi Backes-Gellner & Simone N. Tuor, 2010. "Avoiding Labor Shortages by Employer Signaling: On the Importance of Good Work Climate and Labor Relations," ILR Review, Cornell University, ILR School, vol. 63(2), pages 271-286, January.
    5. Matias Ramirez & Frederick Guy & David Beale, 2007. "Contested Resources: Unions, Employers, and the Adoption of New Work Practices in US and UK Telecommunications," British Journal of Industrial Relations, London School of Economics, vol. 45(3), pages 495-517, September.
    6. Gregory JACKSON & MIYAJIMA Hideaki, 2007. "Varieties of Capitalism, Varieties of Markets: Mergers and Acquisitions in Japan, Germany, France, the UK and USA," Discussion papers 07054, Research Institute of Economy, Trade and Industry (RIETI).
    7. Virginia Doellgast, 2010. "Collective Voice under Decentralized Bargaining: A Comparative Study of Work Reorganization in US and German Call Centres," British Journal of Industrial Relations, London School of Economics, vol. 48(2), pages 375-399, June.
    8. Gregory Jackson & Sarosh Kuruvilla & Carola Frege, 2013. "Across Boundaries: The Global Challenges Facing Workers and Employment Research 50th Anniversary Special Issue," British Journal of Industrial Relations, London School of Economics, vol. 51(3), pages 425-439, September.
    9. Gregory Jackson, 2016. "Toward a Conceptual Framework for Understanding Institutional Change in Japanese Capitalism: Structural Transformations and Organizational Diversity," Working Papers halshs-01643921, HAL.

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