Emerald Group Publishing Limited
Copyright © 2008, Emerald Group Publishing Limited
Global operations strategy: coordinating manufacturing networks
Article Type: Abstracts From: Strategic Direction, Volume 24, Issue 5.
Rudberg M., West B.M. Omega, February 2008, Vol. 36 No. 1, Start page: 91, No. of pages: 16
Purpose To present a framework for co-ordinating an international manufacturing network. Design/methodology/approach States that the approach was originally developed by Ericsson Radio, highlights the increasing complexity of manufacturing and distribution systems due to internationalization, and identifies two issues associated with such systems, i.e. configuration and co-ordination. Reviews literature dealing with manufacturing networks and global operations, draws on prior papers to underline the importance of communication and information sharing, and replicates a diagram indicating how global, international and multinational companies apply cost competitive, flexibility and learning capabilities. Describes a global operations strategy based on the model factory concept, explains the concept comprises three components, i.e. the model factory, a network organization and competence groups, gives the objective of the concept as production of a set of operational guidelines and management directives, tables the capabilities required for each component, e.g. the model factory focuses on cost efficiency and flexibility, and illustrates the model factory concept, indicating relationships and information flows between components. Incorporates micro- and macro-factories, the latter being made up of micro-factories, distinguishes between micro-factories with master-function responsibilities and those with clone-function responsibilities, and details the responsibilities/foci of competence groups of responsiveness to local needs, information and knowledge, and continual update the model factory. Provides an example, Ericsson’s Bright Light Strategy, demonstrating practical application of the model factory concept. Originality/value Argues that the concept/strategy enabled Ericsson to recover following marketing and product development errors.ISSN: 0305-0483Reference: 36BA478DOI: 10.1016/j.omega.2005.10.008
Keywords: Corporate strategy, Ericsson, Factories, International trade, Management science, Manufacturing, Operations management