International Manufacturing Strategy in a Time of Great Flux

236 Pages·2017·3.278 MB·English

by  Louis Brennan, Alessandra Vecchi (eds.)

Measuring Operations Performance
Louis Brennan
Alessandra Vecchi E ditors
International
Manufacturing
Strategy in a
Time of Great
Flux
Measuring Operations Performance
Editor-in-chief
Andrea Chiarini, University of Ferrara, Ferrara, Italy
Series editors
Alok Choudhary, Loughborough University, Loughborough, UK
Adrian E. Coronado Mondragon, Royal Holloway, University of London,
Egham, UK
Pauline Found, University of Buckingham, Buckingham, UK
Sergio E. Gouvea da Costa, Pontifical Catholic University of Parana,
Curitiba, Brazil
Iñaki Heras-Saizarbitoria, University of the Basque Country, Donostia-San
Sebastián, Spain
Kerry Jacobs, University of New South Wales, Canberra, Australia
Adina Claudia Neamtu, Constantin Brâncuși University, Târgu Jiu, Romania
Roberta S. Russell, Virginia Polytechnic Institute and State University,
Blacksburg, USA
Martin Starr, Columbia Business School, New York, USA
Emidia Vagnoni, University of Ferrara, Ferrara, Italy
Jahangir Yadollahi Farsi, University of Tehran, Tehran, Iran
More information about this series at http://www.springer.com/series/13500
Louis Brennan Alessandra Vecchi
(cid:129)
Editors
International Manufacturing
Strategy in a Time of Great
Flux
123
Editors
LouisBrennan Alessandra Vecchi
Trinity Business School London Collegeof Fashion
Trinity CollegeDublin University of the Arts London
Dublin London
Ireland UK
ISSN 2363-9970 ISSN 2363-9989 (electronic)
Measuring Operations Performance
ISBN978-3-319-25350-3 ISBN978-3-319-25351-0 (eBook)
DOI 10.1007/978-3-319-25351-0
LibraryofCongressControlNumber:2016946941
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Contents
Trends in Manufacturing Strategies: A Longitudinal Investigation
of the International Manufacturing Strategy Survey ... .... ..... .... 1
Torbjørn H. Netland and Jan Frick
The Taxonomy of International Manufacturing Strategies .. ..... .... 17
Reza Aboutalebi
International Manufacturing Strategy: The Impact
of Misalignment Between National Culture
and Organizational Structure. ..... .... .... .... .... .... ..... .... 43
Mouhcine Tallaki and Enrico Bracci
Catch-Up Strategies of Emerging Market Firms:
Lessons Learned from India and China . .... .... .... .... ..... .... 63
Wiboon Kittilaksanawong
Best Strategic Decisions in Management of Complex Operations .. .... 85
Thorvald F. Gundersen
ICT and International Manufacturing Strategy ... .... .... ..... .... 105
Antonio Benzi
Do Improvement Programs Complement Each Other? . .... ..... .... 123
Phillip J. Lederer
Practices and Performance in Constraints Management
Production Planning and Control Systems ... .... .... .... ..... .... 153
Roberto Panizzolo
Exploring Critical Success Factors for Implementing
Green Lean Six Sigma .. .... ..... .... .... .... .... .... ..... .... 183
Anass Cherrafi, Said Elfezazi, Andrea Chiarini, Ahmed Mokhlis
and Khalid Benhida
v
vi Contents
S&OP Related Key Performance Measures with Integration
of Sustainability: A Decoupling Point Based and Modularized
View on Supply Chains . .... ..... .... .... .... .... .... ..... .... 197
Sayeh Noroozi and Joakim Wikner
Trends in Manufacturing Strategies:
A Longitudinal Investigation
of the International Manufacturing
Strategy Survey
Torbjørn H. Netland and Jan Frick
Abstract HowhavethecompetitiveprioritiesofEuropeanmanufacturerschanged
over the last 20 years? We investigate this question by conducting a longitudinal
analysis of the International Manufacturing Strategy Survey database, holding
datasets from1992, 1996,2000, 2005,2009 and2013.We highlight five trendsin
the data. First, quality and dependability remain the highest competitive priorities.
Second,costappearstobethemostfluctuatingcompetitivepriority,andcompanies
seem more concerned with costs during times of economic decline. Third, in
general, service seems to be on a decline, but an increase in delivery speed offsets
this tendency. Fourth, flexibility and innovation is gaining relative importance.
Fifth, sustainability is among the least important competitive priorities and dis-
continues its growth trend in relative importance. We also comment on the long-
standingdebatebetweenthetrade-offmodelandcumulativemodelsofcompetitive
capabilities.
(cid:1) (cid:1)
Keywords Manufacturing strategy Competitive priorities IMSS
1 Introduction
Manufacturing firms need to decide how they want to compete in the market.
Should the firm offer the highest quality products, the lowest cost, the fastest
deliveries,thehighestdegreeofcustomisation,thebestafter-salesservice,themost
innovative products, the most environmental-friendly solutions, the best social
T.H.Netland(&)
ETH,Zürich,Switzerland
e-mail:[email protected]
J.Frick
UniversityofStavanger,Stavanger,Norway
e-mail:[email protected]
©SpringerInternationalPublishingSwitzerland2017 1
L.BrennanandA.Vecchi(eds.),InternationalManufacturingStrategy
inaTimeofGreatFlux,MeasuringOperationsPerformance,
DOI10.1007/978-3-319-25351-0_1
2 T.H.NetlandandJ.Frick
responsibility,oranycombinationofthese?Beingamongthemostimportantfacets
ofmanufacturingstrategy,competitiveprioritieslikethesehavebeenmuchdebated
in the operations management literature. Competitive priorities are the strategic
preferences firms target to gain competitive advantage (Hayes and Wheelwright
1984;Leongetal.1990).Alimitationoftheexisting research isthatthebulkofit
focuses only on the four original competitive capabilities, namely cost, quality,
delivery and flexibility. In the last 20 years, however, capabilities like customisa-
tion,service,innovation,environmentalperformanceandsocialresponsibilityhave
gained importance. Therefore, our main research question asks if and how the
competitive priorities of European manufacturing firms have changed over the last
decades.Tothebestofourknowledge,therehasbeenlittleornoresearchonsuch
trends.
Investigating trends in the competitive priorities can also inform the long-
standing debate between the trade-off and cumulative models of competitive
capabilities; do companies see trade-offs between capabilities or do they believe
that all beachieved cumulatively? The empiricalevidencesinthe literature remain
mixed.Althoughourdatadonotallowconfirmationorfalsificationofeitherofthe
models, our second research question investigates which of the two models prac-
titionersseemtoprefer.Themanagers’ratingofrelativeimportanceofcompetitive
priorities can provide indication whether they aim to follow the trade-off model or
cumulative capabilities model.
WeanalysethechangesofcompetitivecapabilitiesusingtheEuropeandatafrom
the six available datasets of the International Manufacturing Strategy Survey
(IMSS).TheIMSSisaninternationalsurveywithresearchpartnersinmorethan20
countries targeting manufacturingcompanies mainlyin themachining, electronics,
and automotive industries (Lindberg et al. 1998). Over the last decades, the IMSS
has had a significant contribution to our understanding of manufacturing strategy
andhowitispracticed(e.g.CaglianoandSpina2000;Gimenezetal.2012;Laugen
etal.2005;Acuretal.2003).Aftersixroundsofdataselection,theIMSSdatasetis
now a unique source for longitudinal research on operations strategy. It contains
relative comparable data from more than 20 years, holding datasets from 1992,
1996, 2000, 2005, 2009 and 2013.
2 Literature Review
A manufacturing strategy can be defined as “a pattern of decisions, both structural
and infrastructural, which determine the capability of a manufacturing system and
specify how it will operate to meet a set of manufacturing objectives which are
consistent with overall business objectives” (Platts et al. 1998, p. 517). This defi-
nition highlights the central notion of competitive priorities and competitive ca-
pabilities. Competitive priorities are the objectives of how firms want to compete,
whereas competitive capabilities is the realised operative skills (Rosenzweig and
Easton 2010). Our research focuses on competitive priorities.
TrendsinManufacturingStrategies:ALongitudinalInvestigation… 3
Competitive priorities have been much discussed in the literature (Ward et al.
1998).Theword“priorities”isusedbecauseitisnotpracticallypossibletodevote
the same amount of attention and resources to all factors of performance. Instead,
mangers must allocate scarce resources to develop a set of prioritised competitive
capabilities (Hayes and Wheelwright 1984). A higher priority is given to those
competitive capabilities that a firm believes it needs to develop in order to win
orders in the market.
Thefourclassicalcompetitiveprioritiesarearguably“lowcost”,“goodquality”,
“short delivery times” and “high flexibility” (Ward et al. 1998; Boyer and Lewis
2002; Hallgren 2007). However, this original list has been expanded. To separate
quick deliveries from accurate deliveries, authors have suggested including “de-
pendability” as a distinctive competitive priority (Ferdows and De Meyer 1990;
Noble 1995; Miller and Roth 1994; Hayes and Wheelwright 1984). Following an
increasedfocuson“servitization”ofmanufacturing(Bainesetal.2009;Schmenner
2009;Vandermerwe1988;Neely2008),“service”hasbeenaddedasacompetitive
priority (Miller and Roth 1994; Noble 1995; Kim and Arnold 1993). Moreover,
“innovation” has been suggested (Miltenburg 1995; Noble 1995; Leong et al.
1990). Over the last 20 years, two new competitive priorities have gained much
attention: “sustainability” and “responsibility”, which we introduce in more detail
in the two next paragraphs.
Jiménez and Lorente (2001) argue for the need to include environmental per-
formance, or sustainability, as a competitive priority. The Brundtland Report, Our
Common Future (WCED 1987), put sustainability on the agenda. It defined sus-
tainabledevelopmentas“adevelopmentthatmeetstheneedsofthepresentwithout
compromising the ability offuture generations to meet their own needs” (WCED
1987, p. 43). Since then, there has been an evidential growth of environmental
programs and certifications in practice, and a growing body of literature on sus-
tainabilityinoperationsmanagement (CorbettandKlassen2006).Thefiveclimate
reports published in 1990, 1995, 2001, 2007 and 2013 by United Nations’
Intergovernmental Panel on Climate Change (IPCC) continue to call for action on
environmentalissues.Today,sustainability(or“green”)isanimportantcompetitive
priority.
Another competitive priority, Corporate Social Responsibility (CSR), was
establishedasadefinitestrategicissueinthe2000s(Moura-LeiteandPadgett2011;
Porter and Kramer 2006; Gimenez et al. 2012). In a report by The World Bank
(Moura-Leite and Padgett 2011, p. 17), 61 % of multinational companies reported
that “CSR issues areatleastas influential asmore traditional factors(forexample,
cost, quality, delivery)”. Porter and Kramer (2006) found that 64 % of the largest
multinationalcompaniespublishedCSRreportsin2005,andconcludedthat“CSR
has emerged as an inescapable priority for business leaders in every country”
(p. 78).
To summarise, Table 1 lists the usually referred competitive priorities in the
literature.