How much does Lean Manufacturing need environmental and information technologies?

This paper analyses the role played by Environmental and Information Technologies (ET&IT) in the capability of Lean Manufacturing (LM) to achieve improved industrial performance. In contrast to seminal literature about lean practices, and in view of increasing consumer requirements regarding response times and environmental concerns, we suggest that shop-floor technologies are crucial for transforming lean routines into enhanced performance. Hypotheses were tested in a multisectoral sample of 763 manufacturing plants (NACE codes 15–37) from five different European countries. Results confirm total mediation by both technologies between lean routines and industrial performance, which entails that LM establishes efficient conditions on the shop floor for developing technology-enabled capabilities that can be leveraged to improve industrial performance. From a managerial perspective our findings highlight the need for avoiding short-sighted attitudes and for internalising plant technologies within lean transformation projects. This is important not only because such technologies are determinant for maximising the potential of organisational routines in current manufacturing systems but also because of their intrinsic benefits.Ministerio de Economía y Competitividad | Ref. ECO2016-76625-

Operational Capabilities: The Secret Ingredient

We develop a theoretical definition of operational capabilities, based on the strategic management and operations management literature, and differentiate this construct from the related constructs of resources and operational practices, drawing upon the resourcebased view of the firm as our foundation. We illustrate the key features of operational capabilities using the illustration of a restaurant kitchen. Because the traits of operational capabilities are distinct, they create a barrier to imitation, making them a potential source of competitive advantage. However, operational capabilities are particularly challenging to measure, because they emerge gradually and are tacit, embedded, and manifested differently across firms. In solving this measurement conundrum, we draw upon similar situations experienced by Schein (2004) and Eisenhardt and Martin (2000) in operationalizing organizational culture and dynamic capabilities. A taxonomy of six emergent operational capabilities is developed: operational improvement, operational innovation, operational customization, operational cooperation, operational responsiveness, and operational reconfiguration. A set of measurement scales is developed, in order to measure each of the operational capabilities, and validated using two different datasets. This allows replication of the psychometric properties of the multi-item scales and helps to ensure the validity of the resulting measures

An evolutionary stage model of outsourcing and competence destruction : a Triad comparison of the consumer electronics industry

Outsourcing has gained much prominence in managerial practice and academic discussions in the last two decades or so. Yet, we still do not understand the full implications of outsourcing strategy for corporate performance. Traditionally outsourcing across borders is explained as a cost-cutting exercise, but more recently the core competency argument states that outsourcing also leads to an increased focus, thereby improving effectiveness. However, no general explanation has so far been provided for how outsourcing could lead to deterioration in a firm‟s competence base. We longitudinally analyze three cases of major consumer electronics manufacturers, Emerson Radio from the U.S., Japan‟s Sony and Philips from the Netherlands to understand the dynamic process related to their sourcing strategies. We develop an evolutionary stage model that relates outsourcing to competence development inside the firm and shows that a vicious cycle may emerge. Thus it is appropriate to look not only at how outsourcing is influenced by an organization‟s current set of competences, but also how it alters that set over time. The four stages of the model are offshore sourcing, phasing out, increasing dependence on foreign suppliers, and finally industry exit or outsourcing reduction. The evolutionary stage model helps managers understand for which activities and under which conditions outsourcing across borders is not a viable option. Results suggest that each of these firms had faced a loss of manufacturing competitiveness in its home country, to which it responded by offshoring and then outsourcing production. When a loss of competences occurred, some outsourcing decisions were reversed

Closing the knowledge gap in Irish manufacturing - a north-south comparison

Knowledge, however defined, is perceived as firms "key" source of competitive advantage and a central determinant of productivity and wealth creation. The value of knowledge as a competitive asset is not intrinsic, but depends instead on its application, i.e. innovation or the transformation of knowledge into new technologies, products and, or services. Therefore, the extent of innovation within an economy depends crucially on the rapid diffusion of new technology and best practice, which it is argued depends in turn on building strong regional networks. So, knowledge, its distribution and diffusion - particularly through the supply chain - form the central focus of this paper. For some economies (e.g. Finland, Israel) with high levels of domestic R&D spending much of the ''new'' knowledge driving local business competitiveness is created domestically. For Ireland, both North and South, however, historically low levels of domestic R&D spending mean that inward technology transfer - primarily associated with inward investment - has been crucial to recent economic development. This suggests two main questions. First, how does the knowledge transferred to Ireland, North and South, through international inward investment compare to international best practice? And, second, to what extent does this knowledge then diffuse to other manufacturing businesses located in Ireland? A third, and related, question concerns the contrasting experiences of Ireland, North and South, particularly given the very different history of inward investment in the two areas. The analysis in the paper is based on data collected through face-to-face interviews with 94 Multi-national enterprise (MNE) plants in the South and North of Ireland. The relatively high response rates achieved and the fact that the final sample coverage resembles relatively closely that of the underlying population suggests that the sample is likely to provide results which are representative of the whole population of large MNE plants in both the South and North of Ireland. The research findings demonstrate that the potential to transfer knowledge from MNE plants to local firms through the supply chain is higher in the South of Ireland than in the North. Yet, Northern suppliers' adoption of a range of best practice techniques lags further behind their MNE plants than in the South. Therefore, larger average knowledge gaps suggest a greater potential benefit from knowledge transfers in the North of Ireland. Yet, while general contact as part of normal trading relations between MNE plants and their suppliers is more common in the North, contact in the South of Ireland is characterised by developmental interactions such as collaboration on product developments and quality assurance systems. Furthermore, southern MNE plants report having had a significantly greater impact on both the performance and the competitiveness of local suppliers than their Northern counterparts.