Helsinki Congress of the International Economic History Association, 21-25 August 2006: Session 93 Equipment goods and mass brands American business spreading modernity into France? Strategies
D. Promoting the American lifestyle out of the home
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- Bu səhifədəki naviqasiya:
- 4. Did the Americans succeed because of the lure of their managerial methods
- A. Efficiency and productivity: American corporations modernizing and reorganizing French firms
- B. American corporations modernizing and reorganizing the labor in French companies
- 5. American corporations identifying themselves as French companies
- A. Did the Americans also penetrate the French colonial territories
- B. The commercial consolidation of American firms
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D. Promoting the American lifestyle out of the home A number of American conglomerates began including France in their expansion plans as and when they began to detect its commercial potentialities and soon, several brands and an entirely new lifestyle had been introduced to add color to the humdrum life of the ordinary citizen. Hertz France was established in 1957 and by 1964 was already renting out some 28,000 vehicles (with arrangements made with Ford and Gm). The first Hilton hotel opened near Orly airport in October 1965 and the second on the Avenue de Suffren in Paris in March 1966. Kodak’s spectacular success before the advent of the Japanese can be explained by its technological edge, its financial clout and the weak presence of its competitors (Ilford, Agfa) in the French market. A splurge of sub-brands (for cameras as well as consumables) further enriched the company’s non-material capital. In the 1960s, Ektachrome and Kodachrome sparked off the color revolution among amateur photographers, the Instamatic camera opened a whole new range beyond the classic 24x36 and the Super 8 which followed was also designed for simplicity of use (the Instamatic 8). In spite of competition represented by Polaroid’s instant camera (another American company), Kodak was firmly in the driver’s seat – which just goes to show the might of the American firms in the French market of the 1960s and 1970s. All these trends converged towards one result: the setting up of robust subsidiaries of American corporations in France and their contribution to raising the French standard of living. Having said that, it must be noted that the extent of the domination enjoyed by the Americans in certain sectors of the market in the mid-1960s was astounding.
4. Did the Americans succeed because of the lure of their managerial methods? As with the consumer goods, the American invasion was equally discrete when it came to the insertion of the “immaterial capital” in France. Without delving too deep into the “managerial revolution” we can simply say that “America [got] into the heads”137. We can cite two examples which illustrate how these American brands conquered the world of the office. Scotch (of the 3M group), which had long become a generic term for any sticking tape and Ibm – just before the triumphant entry of Xerox and its ubiquitous photocopiers in the second half of the 1960s. A. Efficiency and productivity: American corporations modernizing and reorganizing French firms The meeting of American and European commerce resulted in a new “organizational model” which was more concerned with improving productivity and flexibility in order to reduce costs and increase the reliability and resiliency in the face of recurring commercial vagaries, especially that of a fluctuating demand. The Americans were seen as catalysts of such organizational revolutions. A report published in the magazine L’Expansion on the strengths and weaknesses of the American economy, concluded the article with these words: “the willingness to become efficient.” 138 It also enumerated the causes: labor productivity, research and development, industrial might, link between university and enterprise, etc. a. American corporations advising French companies As they had done with the rest of Europe, the Americans discreetly introduced their managerial savvy into the French corporate mindset. In 1964, the American consulting firm MacKinsey opened an office in Paris, one of the 14 it had established all over the world. Its boss Claude Peyrat went on to become one of the 80 directing co-owners of the parent company (and one of the nine Europeans). Subsequently, a number of enterprises have had occasion to consult this cabinet regarding their reorganization projects139, such as Rhône-Poulenc, the chemical and pharmaceutical giant. Between October 1968 and May 1969, MacKinsey made an in depth study on the reorganization of its structure and came up with the multidivisional scheme which has turned into a classic of its kind. A second MacKinsey mission in 1973 further refined the plan. In contrast, the American ad agencies did not seem to need to tread as softly when they introduced their technology into France in the 1960s. Just as McCann-Erickson France were launching their publicity campaign140 to establish themselves as an ad agency, Compton set up shop in Paris in January 1968 by buying 20 per cent of Dupuy, which thus turned into Dupuy-Compton141. Also in January of that same year, Publicis entered into a cooperative arrangement with the American company Ogilvy & Mathes, just ahead of a similar agreement between Havas and Doyle, Dane & Bernbach Ddb in December. In the same month, J.R. Monfort was taken over by Provente, Norman Craig & Kunnel Nck. In 1971 Lintas bought Thibaud. At the turn of the 1970s, six of the 20 top French ad agencies either belonged to American companies (such as Walter Thompson France) or were junior partners (like Liger Beaumont, Alianvic, 25 per cent of which was acquired by Benton & Bowles in 1967). In January 1970, we find Young & Rubicam promoting themselves142 by proclaiming their victory in bagging the publicity contract for the launch of Kiri cheese in January 1968. Nevertheless, in this domain at least the local French firms (Havas and Publicis) were able to hold the Americans at bay, ceding only a quarter of the market143. b. American corporations modernizing and reorganizing the French offices One of the first issues of the newly designed “magazine” of the weekly L’Express, which appeared in November 1964, illustrated the American managerial lifestyle via the ads by Twa (executives and managers traversing the Atlantic in supreme comfort) and especially by Ibm. Ibm’s style of promoting its image set the trend for the ad strategy of the time. It was no more a question of projecting the superiority of the product, as Ibm already had a commanding share of the market, it was more an effort at increasing the size of the market by orienting it towards the processing of data by demonstrating the advantages of computers over the simple electronic calculators. The idea was as much to bring in this new “corporate civilization” as to promote the brand. Instigated by Ibm’s resounding success, several other American computer firms such as Ncr, Digital, etc., also set up shop in France and furthered this restructuring of the administrative and accounting organization. As we shall deal with the case of Ibm and Ge-Honeywell later, we shall content ourselves at the moment by simply observing that the advent of all these companies also opened the doors for the components and spare parts industry. The American multinationals now began to include France in their European strategies and started by implanting two new factories, one at Toulouse-Rangueuil (Motorola, in 1967, with 1,100 employees) and the other at Nice-Villeneuve-Loubet (Texas Instruments). Though it must be said that in the 1970s, the vast majority of their sales in France were made with imported material. While business oriented data processing began in earnest from the 1960s, the American enterprises also influenced greatly the reorganization of the French workplace. While they did not, of course, have a monopoly, they symbolized the drive towards modernity by introducing machines and appliances which greatly increased efficiency. Thus, after its progress during the pre- and post-war periods, Remington bought itself a factory in the Lyon region (Villeurbanne) in 1950 to manufacture typewriters. The American’s lead in the field of precision mechanics helped them dominate the typewriter, calculator and photocopier market for the next quarter century. The triumph of the IBM 72, an electronic typewriter with a spherical type-carrier was emblematic144 during the 1960s. While Ibm entrenched itself solidly in the office equipment market, it could not dominate it the way it was doing in the computer industry because of the strength of its European competitors like Olivetti, Triumph-Adler, Hermes, etc. The calculating business grew along with the growing needs of the accounting practices, such as the need for a chart of accounts, computation of interest, etc. The sewing equipment giant Singer also ventured into the burgeoning office equipment market via its subsidiary Friden which it had acquired in 1963. After some hesitation, it brought the two brands together to form Singer-Friden, which manufactured a range of calculators and competed with Remington-Rand. At the same time this latter was in the process of diversifying into a wide range of other office equipment including typewriters (Rand typewriters). But at a time when the mechanical and electronic calculating technologies were both mixing it up on the playing field and office automation was just taking off, specialists such as Burroughs were clearly making their mark. The competition was equally cut-throat in the copying market, but ultimately, the Americans triumphed with the advent of reprography. After having diversified from the manufacture of typewriters and calculators to the making of photocopiers, Scm Smith-Corona145 also entered the French market in September 1964 via the means of a subsidiary. Its first advertisements in magazines appeared in 1969, and it climbed to the second spot in its genre. Towards the end of 1960s and throughout the 1970s, Kodak also entered the fray when it diversified into the document reproduction business, just as 3M was launching its own brand of photocopiers. Meanwhile, Xerox raced to the top spot in France as elsewhere else. Its innovativeness caused Xerox to be “called upon to explore the future of visual communications”146. At a time when the Asian competitors were conspicuous by their absence, Xerox took full advantage to entrench itself solidly in the French mind and market. Though 3M sold some 108,000 copiers in 1978 as compared to the 55,000 by Rank Xerox, they were mostly the smaller and lower end models, and in terms of real value, Xerox’s domination was complete. Xerox’ impact in France, as elsewhere, was rapid and intense because the technology147 that it offered was state of the art, just developed in 1959-1960 (914 model) and its subsidiary was established only in 1964. It did not have a factory till the opening of its first assembly plant at Lille in 1974. Its main drive was a commercial assault: building a brand and a brand image and the setting up of a technical service network. Xerox also benefited from the fact that the message it conveyed was simple and unequivocal, in contrast to many of its competitors whose signals were often mixed because of the diversity of their products and technologies, like it happened in the case of Kodak and 3M. “Xerox is the only one who makes photocopiers… and nothing else.”148 “Fifty-one brands of photocopiers, and yet 1 out of every four copies made is ours […]. Perhaps it is because we are the only ones who make copiers only.”149 Some have estimated its market share at 35 per cent towards the end of the 1960s. It would seem that in contrast to the other specialized manufacturer Scm Corona Marchant, Xerox was able to convince the French about its (relative) reliability, its technological superiority (the 813 in 1963, in France in 1965, the 2400 in 1964 which was capable of making 2,400 copies per hour, the 3600, 4000 and 9200 in the mid-1970s, etc.) and the efficiency of its after-sales service. All this while also introducing hire-purchase schemes and coming up with newer innovations such as mini-photocopiers and the laser printer in the 1970s. The result was a giant of an enterprise, with a total turnover of 2,658 million francs and 5,300 employees in France in 1981 which accounted for 14 per cent of Rank Xerox’ total, and one of its five factories150 – Rank Xerox being Xerox’ European subsidiary. The rest of the office equipment and material market also depended largely on American know-how. Of the top eight leading manufacturers of office material in 1979, three were American: Steelcase, Atal which was linked to Litton, and Ranger, linked to Mohasco Industries. The 3M group had been in France since 1951, with an installation at Beauchamp for the manufacture of office stationary (the scotch brand of sticking tape and later, photocopier paper, etc.) before expanding its Scotch brand to include computer magnetic tapes. B. American corporations modernizing and reorganizing the labor in French companies The introduction of some flexibility in human resources management caused an upheaval in French firms because the work regulations, the labor laws operating in many of the government controlled companies, or the modus operandi agreed upon with labor unions had left little room for any maneuvering in the face of the growing demand. The introduction of temping also helped to spread the American style of management. Though the French firms were quick to spot the advantages of this new market, it was the American company Manpower (created in 1948) which pioneered the concept in France in 1957. Its first advertisement in L’Express, a management magazine, appeared on 1st March 1965: “Manpower, the mark of professional expertise”151 with its famous logo, Leonardo da Vinci’s Vitruvian Man (which it retained till 2005). A franchisee for interim office personnel was set up in France in July 1960. It quickly achieved commercial success152, especially due to the temporary labor market. It even worked with the government to define the notion of “mission” which up till had no mention in the French labor laws. 5. American corporations identifying themselves as French companies We hope to show here the extent of the American penetration into the French corporate sector, the chronology and manner in which they entered the market and some of the methods they used to loosen the grip of the local brands. As a first step, we will try and recapitulate empirically the flow of investments. A. Did the Americans also penetrate the French colonial territories? The French colonial territories also felt the American impact when the accord of June 1948 stipulated that they too (except Indochina) came under the aegis of the Marshall Plan. This led to the inking of several contracts, like the one signed in 1946 by Beghin of Morocco to equip its new paperboard factory with American equipment. The strength of the American automobile industry was reflected in their ubiquitous presence in that sector. Ford had been distributed in black Africa since the 1920s by the trading giant Cfao. Firestone Morocco153 was created in 1955. Later, the American oil companies also profited from the French trading networks, with Cfao representing Texaco. The advent of air-conditioning in modern buildings led to an alliance between the other trading giant Scoa and Westinghouse in 1946 for the dealership of industrial and home air-conditioners. In fact, Scoa was Westinghouse’s first outlet outside the United states in the 1950s. These companies then expanded and pushed a range of other technological equipment through their distribution networks. The Cfao added International Harvester (an American company) products to its English and French network, Ja Delmas-La Manutention africaine sold the Caterpillar brand in West Africa (Sénégal, Soudan, Guinée, Côte d’Ivoire, Niger) while Optorg did the same in Central Africa: This latter’s subsidiary Tractafric accounted for four fifths of its profits in the 1950s thanks mainly to the line of Caterpillar heavy equipment, used as much in civil engineering as in foresting. Cfao also furnished, from 1951 onwards in Nigeria, and 1960 onwards in the other French-speaking countries, all the equipment required for the large buildings which were sprouting up at a hectic pace in the capitals of these newly-formed republics (Otis lifts and Cgct telephone systems – Cgctbeing a subsidiary of the American conglomerate Itt, specialists in the private telephone sector154). It also launched the Remington range of office equipment in the 1950s. And yet, in 1953, the major portion of American investments in the French empire155 was concentrated in the oil sector which accounted for 27 out of the 31.4 million dollars invested by American corporations in France’s African colonies. This was especially true for the distribution of petroleum products, which saw a tripling of the 11.3 millions invested in 1943. At the beginning of the 1950s, Socony Vacuum created the petroleum company, Socony Vacuum de l’Aef, which in turn participated in the establishment of a petroleum storage company. Gulf Oil bought a 6 per cent stake in the Société nord-africaine des pétroles. Then, after the War, American businesses scrambled to get into the minerals business with Us Steel buying out 49 per cent of the 150 million dollar capital of the Compagnie minière de l’Ogooué, which began manganese extraction in Franceville, Gabon. The same trend continued in 1967 and in 1970-1971, when the American group Kaiser156 signed an understanding with the Société Le Nickel to open a Nickel treatment plant in New Caledonia. B. The commercial consolidation of American firms As a primary concern of any enterprise is the prevention of a breakdown in the equipment and minimizing the resultant downtime, American firms did not tire of advertising the quality of their after-sales service. Worthington enumerated the list of its 19 agencies: “We are present everywhere.”157 “Service? A dense network of dealerships and the most modern infrastructure guarantee a rapid and efficient after-sales service.”158 “Behind an international brand, a commercial network ‘very much from home’.”159 “With its 34 dealerships, International Harvester is ready to take on the French market.” This engineering equipment firm went on to add: “96 per cent of the spare parts ordered by 4 o’clock in the evening are delivered anywhere in France the very next morning.”160 And the advertisement shows the equipment painted in the French tricolor… a trick that it used in many of its ads, for its industrial loaders161 and for its shovels162. Based on their experience of many decades regarding consumerism and the long term benefits of investing in publicity, American companies pulled out all the stops regarding their commercial communications in the French press. One voluminous issue of L’Express, which appeared in November 1966163, had 28 pages (a whopping 16 per cent of the entire magazine) of advertisements by American brands – automobile, cosmetics and skin care products (Gillette had four ads), cigarettes, household electric appliances, air transport, office equipment, etc. This barrage proved, if proof be required, that France had been incorporated in the commercial strategy of American businesses, that it had now well and truly become a “target”. By 1967, two American companies figured in the list of top ten advertisers in the French press: Colgate-Palmolive (ranked second) and Procter & Gamble (ranked third). Both came in behind Unilever but ahead of Renault and L’Oréal164. Yüklə 1,17 Mb. Dostları ilə paylaş:
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