1901-1/2

TECHNOLOGICAL CHANGE AND BUSINESS STRUCTURE IN THE AMERICAN MEAT-PACKING INDUSTRY

Haruhito Shiomi

Nagoya City University

The modern business enterprise resulted from the integration of mass production with mass distribution within a single business firm. The American meat-packing industry created the typical type of enterprise exemplified by the "Big Five" at the beginning of the 20th century. However, the dominant status of the "Big Five" has ceased today. The industry clearly represents the category of slight to negligible barriers to entry, and might be labeled as "low moderate" concentration. This paper focuses on the resolution process of "Big Five" business structure under long-term technological trends. Section II and III argue that differences in entrepreneurial response to the refrigeration age brought forth three types of business structure. Section IV raises and attempts to answer the question of the decline of the "Big Five."

1901-2/2

DEPRECIATION SYSTEM IN EARLY NINETEENTH CENTURY BRITAIN.

THE CASE OF THE CYFARTHFA IRONWORKS

Etsuo Abe

Meiji University

From the viewpoint of accounting history, it is one of the great issues when and how systematic depreciation began. At the present time, an influential understanding on this matter might be that of A. C. Littleton, a renowned accounting historian. He maintained that systematic depreciation did not originate until the mid-nineteenth century when railway came up. By contrast, there is a different view that during the Industrial Revolution systematic depreciation already started. In this controversy, it is noteworthy that depreciation must be systematic and regular, not haphazard is assumed. Accordingly, depreciation by the inventory method is excluded from the discussion because it is not planned depreciation.

The author tries to give some evidence to this problem by dint of looking into the accounts of the Cyfarthfa Ironworks Which was the largest ironworks in Britain during the early nineteenth century. As a result of analysing these accounts, the following facts were found.

In the Cyfarthfa ironworks, broadly speaking, the straight line method was adopted as a means of writing off “Premises”, from 1819 on. Although the way to write off “Premises” was rather complicated, it is obvious that they used the system so as to recover their invested fixed capital just when the lease contract regarding raw materials would expire. For that purpose, they set the length of 45 years to write off “Premises” in 1819. The process to discover this mechanism was kind of mysterious. In the long run, this fact-finding gives weight to the view that systematic depreciation started before the railway age by offering a fresh exemplification.

1902-1/2

GROWTH BEHAVIOR AND ADMINISTRATIVE STRUCTURE AT SCHNEIDER AND COMPANY: 1913

Daijiro Fujimura

Hiroshima Shudo University

Schneider and Company, a leading industrial enterprise in France, instituted the Rules to establish principles of its internal organization in 1913. Based on these Rules, I attempt to suggest an explanation for its administrative structure on the eve of the World War I, focusing on its operating units.

Schneider, like other French’ industrial enterprises in those days, made little use of mass-production techniques, providing nonstandardized goods for producers and governments. However, Schneider had a high reputation as a maker of large, precision products which required a highest level of technology at that time to be fabricated, such as locomotives, marine engines, artillery, armorplates, bridges. As most of its products were made by order and small-batch, Schneider had grown, since its establishment in 1836, by continuously diversifying its products, and by diversifying in a number of industries. According to the Rules, Schneider made industry the basis of the organization of its production units: iron mines, coal mines, pig iron and steel producing, rolling mill, machine construction, electric machine construction, field artillery, naval artillery, forging and armorplate finishing, shipbuilding, mine making, bridge and building. Each of these units had its manager as well as its accountant’s and engineer’s offices, and formed a separate unit of accounts. Therefore each formed the “operating unit”, to use the term of professor Chandler, Jr., though many of them were in the same site, Le Creusot. Organizational imperatives at Schneider, however, showed clear differences to those at the American “modern business enterprise”. As most of its products required several months or more to be accomplished, and were made by order and small batch, Schneider organized its operating units to administer individual orders from the acceptance to the deliery. Thus the unit’s accounts were organized to perform estimating and recording costs of separate orders. The controller’s office was also formed to apparaise the unit’s performance by order. Since each of these orders formed an autonomous administrative unit, the operating units which administered them remained autonomous. Though large enterprise with more than 10,000 employees, Schneider was composed of numerous administrative units of orders, and of autonomous operating units.

Schneider did form, in Paris, headquarters and a central office headed by salaried managers, but by different ways from those at United States firms which integrated mass production with mass distribution. As Schneider’s growth behavior was different from that of the American big business, its organizational growth pattern also different.

1902-2/2

THE RISE OF LABOUR UNION MOVEMENT AT THE HOKKAIDO COAL AND SHIPPING COMPANY AFTER THE FIRST WORLD WAR, AND MANAGEMENT’S COUNTERPOLICY

Hiroshi Ichihara

Hitotsubashi University

The subject of this paper is what kind of policy the management took to counter the labour union movement at the Hokkaido Coal and Shipping Company, called Hokutan, after the First World War, and how industrial relations at Hokutan was reformed.

Hokutan became an affiliated enterprise of Mitsui Zaibatsu in 1913, and then the paternalistic policies were enforced there. The labour union was organized at Hokutan in 1919, the peak of the post-war boom. It was based on the consciousness as producer of mine workers. To control the mine workers against the labour union, the management organized the organization of employees, Issinkai, which fulfilled the function of the roundtable conference of labour and management and mutual aid association according to the idea of corporation of labour and management.

The management carried out the wage cuts because of the damage due to the post-war crise in 1921. So the labour union went on strike in opposition to the wage cuts. At last the issue of this dispute was whether the management approved the labour union as a bargaining body or not. After this strike, the labour union was ruined, and the authority of negotiation about labour conditions was given to Issinkai. And the management succeed to make use of is6inkai to control the mine workers according to the idea of corporation of labour and management.

1903-1/2

SEVRAL PLANS FOR REGULATING THE ELECTRIC POWER INDUSTRY IN THE 1920’S AND THE 1930’S

Takeo Kikkawa

Aoyama-Gakuin University

The purpose of this paper is to examine several plans for regulating the electric power industry which Were proposed by managers of five big electric power companies, Toho Electric Power Co., Tokyo Electric Light Co., Ujigawa Electric Power Co., Great Consolidated Electric Power Co. and Nippon Electric Power Co., in the 1920’s and the 1930’S. The managers mentioned in this paper are Yasuzaemon Matsunaga, Shohachi Wakao, Seinosuke Go, Ichizo Kobayashi, Yasushige Hayashi, Senzaburo Kageyama, Momosuke Fukuzawa, Jiro Masuda, Shinnosuke Arimura, Yoshizo Ikeo, Sataro Fukunaka, Kumaki Naito and Yoshijiro Ishikawa.

The commonly accepted theory asserts that the managers of five maximum big electric power companies devoted themselves to gain profits at the expense of the public interests in those days, and that therefore the electric power industry was inevitably to be put under government control in 1938. The conclusion of this paper is, however, fairly different from those assertions. In reality the managers of five big electric power companies were relatively aware of the responsibility of public utility enterprises, and made efforts to supply plenty and lowpriced electricity. To give an example Yasuzaemon Matsunaga who was the vice-president of Toho Electric Power Co. announced Denryoku Tosei Shiken (the Private Opinion for Regulating the Electric Power Industry) in May 1928, in which he emphasized the necessity of improving electricity service through introducing a new system. The so-called Denryoku Saihensei (the Reorganization of the Electric power Industry) in 1950 was enforced according to this Matsunaga’s opinion.

1903-2/2

THE ACCOUNTING SYSTEMS IN MITSUI RYOGAE-DANA ICHIMAKI, 1729-1870

Noboru Nisikawa

Saga University

Early in the 18th century the House of Mitsui created a divisionalized administrative structure with a general office known as Omotokata in order to control many operating shops. By 1729, Mtsui’s divisional structure came to consist of two major operating divisions--Hon-dana Ichimaki (the chain of silk fabric shops and a cotton fabric shop) and Ryogae-dana Ichimaki (the chain of exchange houses and silk commission houses). This paper focuses on the accounting systems in Ryogae-dana Ichimaki from 1729 through 1870.

The research for this paper is based on many accounting reports that have survived and are preserved in the House of Mitsui Archives Collection at the Mitsui Research Institute for Social and Economic History (Mitsui Bunko), Tokyo.

The structure of Mitsui under Omotokata resembled a divisional system as a whole, while Ryogae-dana Ichimaki may be characterized as a scaled down divisional structure. Each shop in Ryogae-dana Ichimaki had an independent accounting system, although Kyoto Ryogae-dana (Kyoto Exchange House) collected and distributed the residual profit of its affiliated shops.

A part of the semiannual net income of the affiliates was set aside as reserves for their bad debts and building repairs. The residual profit of the affiliates was transferred to Kyoto Ryogae-dana and added to its net income. A part of its total profit set aside as reseves for its own bad debts and building repairs reserves or employees’ bonuses and retirement allowances of its own and its affiliates.

Although Omotokata was divided in a way like a spin-off of today in 1774, and reconsolidated in 1797, the accounting system in Ryogae-dana Ichimaki were virtually unchanged till 1870.

1904-1/2

THE CONTROVERSY OVER THE MANAGEMENT OF A RAILROAD COMPANY AND THE MOVEMENT OF THE STOCKHOLDERS DURING THE MEIJI PERIOD

--Concerning the Kyushu tetsudo kaikaku undo--

Tadashi Tojo

The Kyushu tetsudo kaikaku undo (the Movement for the Reform in the Kyushu Railroad Company) was believed to have resulted from the dispute between Mitsubishi and Mitsui over the hegemony of the Kyushu Railroad Company. Both Mitsubishi and Mitsui were seeking control over the coal industry of the Chikuho region, and to obtain hegemony of the Kyushu Railroad Company was important, for it was the leading company in the transportation of coal in the northern Kyushu region. By examining the Kyushu tetsudo kaikaku undo in detail, this paper illustrates that the primary cause of this movement was not the dispute between Mitsubishi and Mitsui but was far more complex. Also, this paper shows the problems in management of the privately owned railroad companies after the Sino-Japanese War.

The aggressive policy of the Kyushu Railroad Company played an important role in the formation of the Kyushu tetsudo kaikaku undo. The company was forced to take this aggressive policy because of two main reasons. First, the company was established on limited capital; and second, the industrial growth after the Sino-Japanese War placed a great demand on transportation. These forced the railroad companies to upgrade their facilities. This upgrading was supported by various companies involved in the coal industry that held stocks in the Kyushu Railroad Company, while other stockholders were not so eager to support such upgrading because of the decreasing profits. Particularly, it was the stockholders who hoped for the nationalization of the Kyushu Railroad Company and the bankers who held stocks in this company that became the main opponents for the executives of the Kyushu Railroad Company.

1904-2/2

THE KYUSHU SPINNING COMPANY AND THE MITSUI ZAIBATSU

A change of correlation through the “Osaka shiten (branch in Osaka)’s case”---

Masao Nagae

Fukuoka University

The purpose of this paper is an examination of the correlation between a local spinning company and Zaibatsu (financial group) during the period of capitalism establishment by utilizing the data about Kyushu Spinning Company and Mitsui.

Kyushu Spinning Company was established by consolidation of three companies, or Miike, Kurume and Kumamoto spinning company, in 1899. This company had about 50,000 spindles and was a big company at that time as a local one. But its business results were aggravated by an effect of the post Sino-Japanese War depression. Furthermore, the speculation that Matazo Moriyama, the manager of Osaka branch of Kyushu Spinning Company, put into operation to cover above aggravation resulted into failure. Then, managers of this company tried to reform the business by calling up un-paid capital, but this plan did not be realized because a capacity in raising capital of local stockholders was very limited. Consequently, reformation of this company was left to Mitsui accompanied by stockholders’ loss from capital reduction. Mitsui obtained the managerial rights of this company; on the other hand it improved a financial position of this company with its large ability in raising capital. And it made efforts to increase the profit through a reduction in interest payment and a utilization of sales ability that Mitsui-bussan (trading company) had.

Thus, supported by the recovery of business conditions, Mitsui accomplished managerial reformation of Kyushu Spinning Company with its synthetic ability as a Zaibatsu. And then, Kyushu Spinning Company was absorbed by Kanegafuchi Spinning Company, a company that was a member of the Mitsui Zaibatsu, in 1902.