"The paper consists of two parts, the first focusing on the institutional heritage of an innovative work organization (teamworking) that emerged in state-socialist firms in Hungary in the 1980s. The second part of the analysis concentrates on the impacts of foreign direct investment (FDI) on work organization, with special regard to the employees' role in task structuring in the post-socialist economy during the 1990s.The experience with the so-called 'Inside Contracting Groups' (Hungarian acronym: VGMK) in the 1980s actually meant an innovative attempt to mobilize human resources by letting employees establish their autonomous working groups after their regular working time. Almost a tenth of the industrial workforce participated in this nation-wide social experiment. The technical-professional and social-cultural learning processes in these autonomous working groups have produced the following 'spill-over effect': these 'proto-entrepreneurs' within the state-socialist firms became micro- or small business owners after the collapse of the state-socialist political and economic regime. During the 1990s, the first decade of the emerging market economy in Hungary, massive FDI arrived in the country and had a strong impact on the diffusion of organizational innovations in labour processes, too (e.g. teamworking, cost centres, TQM, IT use, ISO 9000, etc.). 'Leading-edge' management practices in foreign-owned firms play the role of 'external benchmarking' for Hungarian firms, but, beside the transfer of some organizational innovations in labour processes (e.g. increasing employee participation in the quality assurance), it is hard to identify in the indigenous firms innovative practices like that of the VGMK in the 1980s."

Support: Paper