SEMINAR SERIES
Economic and Business History Seminar
Eric Golson(Associate Professor, School of Economics, University of Surrey)
- Date&Time:
- 2024.10.22 (Tue) 10:30 - 12:00
- Venue:
- Refresh Room on 8F, Faculty of Law and Faculty of Economics, East Bldg., Yoshida Campus, Kyoto University
- Language:
- English
- Contact:
- YONG, Yen Nie
FY2024 the 3rd Economic and Business History Seminar
Title:
"Evading Trade Sanctions Using Organizational Structure: A Case Study of Swedish Ball Bearings Firm SKF, 1939-1945"
Abstract:
This paper analyses the organisation, strategy and actions of SKF, a Swedish manufacturer of ball bearings with multinational operations during World War II. SKF used Sweden’s national neutrality as a strategy to maintain the independence of its firm during the war. Although headquartered in Sweden, SKF had operations in more than forty countries at the start of the war. The original patents and technology for their products were German. SKF was the principal neutral supplier of ball bearings during the Second World War, with a parent-based supply chain. The high-quality nature of its products meant SKF directly controlled some 31% of British and 48% of German supply; because neither other British nor German supplies were of sufficient quality for war requirements (such as Aero engines), SKF was also a critical supplier of these goods on which both countries depended for their war efforts (Golson, 2012).
The current historiography claims SKF and other neutral multinationals operating in belligerent territories acted as any other business in war: ceding control of production to the state, welcoming limitations on Unions and most importantly, continuing to produce larger quantities of war materiel to meet requirements. However, unlike other businesses, SKF used a unique organisational structure and supply chain to maintain its position, coached in Swedish neutrality. It pursued a distributed operations structure, with the same products made in subsidiaries across the different belligerents and in occupied territories. Operational control was maintained as the Swedish parent company was also the main supplier of the highest quality iron ore and especially machine tool parts to make these goods. It also supplied the same finished bearings the subsidiaries did. This gave the parent company unusual wartime operational control over its belligerent-located operating subsidies and the ability to augment local production with imports. Any attempt to disrupt this communication or business operations more generally led to accusations of unfair action against a neutral business, even if the goods it was producing were crucial to the belligerent’s war efforts.
Keywords:
World War II, Neutrality, Organization, Corporate Structure, Ball Bearings, Sweden