Search results
1 – 9 of 9Mark D. Hanna, W. Rocky Newman and Sri V. Sridharan
Recently many manufacturers have emphasized the enhancement of customer service through increased manufacturing flexibility. Sophisticated models exist for the justification of…
Abstract
Recently many manufacturers have emphasized the enhancement of customer service through increased manufacturing flexibility. Sophisticated models exist for the justification of modern automation technologies which could have an impact on manufacturing flexibility, but practitioners are more likely to utilize a simple tool such as cost‐volume break even analysis. Indeed, much of the difficulty that managers have in justifying modern automation technologies may be due to the shortsightedness of cost‐volume break even analysis. In this paper, we introduce an equally simple justification tool, cost‐volume‐flexibility break even analysis, and explain its use and the benefits accompanying its use.
Details
Keywords
Mohamed E. Bayou and Alan Reinstein
The few management accounting pricing methods in the management accounting literature are ineffective in helping small firms use their idle capacity during lingering economic…
Abstract
The few management accounting pricing methods in the management accounting literature are ineffective in helping small firms use their idle capacity during lingering economic recessions, and some of these methods may even worsen this problem.
Extending the traditional break-even-cost-volume-profit model, we derive a more effective pricing method, the break-even-full-capacity-utilization (BEFCU) model, to handle this problem. Seeking full capacity utilization, the BEFCU model has two characteristics: (a) highlighting the importance of the exigent fixed cost category for utilizing idle capacity and (b) using a functional cost structure that focuses on a hierarchy of value drivers in the firm's value creation process. Accordingly, under the BEFCU model, management has an instrumental pricing continuum extending from the minimum acceptable BEFCU sale price to the regular sale price.
To demonstrate its practicality, the authors apply the BEFCU model to an actual job shop. This model integrates certain strategies based on built-in flexibility in commitments with suppliers and customers and maintaining a mode of conservatism in accounting for plant assets. The model can also help small tooling companies currently seeking entrance into China; it may take a while for these companies to gain a foothold in this new market because copyrights and other legalities are rarely enforced (Bunkley, 2004).
Virpi Turkulainen and Mikko Ketokivi
Conventional wisdom has it that cross‐functional integration is a “must”. The purpose of this paper is to take an information‐processing approach to integration and elaborate the…
Abstract
Purpose
Conventional wisdom has it that cross‐functional integration is a “must”. The purpose of this paper is to take an information‐processing approach to integration and elaborate the conventional wisdom by theoretical examination of both the concept of integration as well as theoretical and empirical elaboration of its link to operational performance.
Design/methodology/approach
The authors develop six propositions on how cross‐functional integration affects performance and test the propositions in an international sample of 266 manufacturing plant organizations in nine countries.
Findings
The results strongly suggest that disaggregation of performance is important, because the effects of cross‐functional integration on performance are contingent: even though the effects of achieved integration on several dimensions of operational performance are positive, the performance effect varies from one dimension to the next. This is an important finding given that performance has typically been treated at an aggregate level in prior research on the performance effects of integration.
Originality/value
Although most research on integration has focused on the performance implications in particular, theoretical work on the nature of the integration‐performance relationship is required. In this paper, the authors argue the benefits of cross‐functional integration to be fundamentally context‐dependent and elaborate the link between integration and performance by developing the definition of the concept of integration further, as well as by disaggregation of performance, to its constituent dimensions.
Details
Keywords
Pietro Cunha Dolci, Antonio Carlos Gastaud Maçada and Ely Laureano Paiva
The purpose of this study is to develop models and analyse the influence of supply chain governance (SCG) and its conceptions (contractual, relational and transactional) on supply…
Abstract
Purpose
The purpose of this study is to develop models and analyse the influence of supply chain governance (SCG) and its conceptions (contractual, relational and transactional) on supply chain performance (SCP).
Design/methodology/approach
Multiple case studies and survey methods were used. Data collection in the multiple case studies was performed by in-depth interviews with supply chain executives from top strategic levels in six companies. The research instrument was applied to 185 executives from large companies that possessed a broad, complex supply chain in Brazil.
Findings
It was identified that SCG, comprising contractual, relational and transactional aspects, has a positive influence on operational and financial SCP. SCG was found to be a more comprehensive view of the supply chain that focuses on more strategic aspects and long-term inter-organizational relationships. SCG affects SCP, primarily in the operational aspects with regard to global costs and in the financial aspects of investment return.
Originality/value
SCG is a topic that has been widely studied in recent years for analysing inter-organizational relations as a multi-dimensional phenomenon embedded in the company’s structures and processes. Studies analysing all aspects of SCG at the same time, however, have not been found. Moreover, there are a number of performance indicators, but there is a lack of consensus on what determines the performance of these supply chains. Furthermore, few studies have attempted to understand the effects of SCG on supply chain performance.
Details
Keywords
Mattias Hallgren and Jan Olhager
Lean and agile manufacturing are two initiatives that are used by manufacturing plant managers to improve operations capabilities. The purpose of this paper is to investigate…
Abstract
Purpose
Lean and agile manufacturing are two initiatives that are used by manufacturing plant managers to improve operations capabilities. The purpose of this paper is to investigate internal and external factors that drive the choice of lean and agile operations capabilities and their respective impact on operational performance.
Design/methodology/approach
Lean and agile manufacturing are each conceptualized as a second‐order factor and measured through a bundle of distinct practices. The competitive intensity of industry and the competitive strategy are modeled as potential external and internal drivers, respectively, and the impact on quality, delivery, cost, and flexibility performance is analyzed using structural equations modeling. The model is tested with data from the high performance manufacturing project comprising a total of 211 plants from three industries and seven countries.
Findings
The results indicate that lean and agile manufacturing differ in terms of drivers and outcomes. The choice of a cost‐leadership strategy fully mediates the impact of the competitive intensity of industry as a driver of lean manufacturing, while agile manufacturing is directly affected by both internal and external drivers, i.e. a differentiation strategy as well as the competitive intensity of industry. Agile manufacturing is found to be negatively associated with a cost‐leadership strategy, emphasizing the difference between lean and agile manufacturing. The major differences in performance outcomes are related to cost and flexibility, such that lean manufacturing has a significant impact on cost performance (whereas agile manufacturing has not), and that agile manufacturing has a stronger relationship with volume as well as product mix flexibility than does lean manufacturing.
Research limitations/implications
Cross‐sectional data from three industries and seven countries are used, and it would be interesting to test this model for more industries and countries.
Practical implications
The results provide insights into the factors that influence the choice of lean or agile manufacturing for improving operations, and the results that can be obtained.
Originality/value
To the authors' knowledge, this is the first large‐scale empirical survey of leanness and agility simultaneously, using data from manufacturing firms in Europe, Asia, and North America. The model incorporates a wide perspective on factors related to lean and agile manufacturing, to be able to identify similarities and differences.
Details
Keywords
Rafael Lorenz, Christoph Benninghaus, Thomas Friedli and Torbjørn H. Netland
Manufacturers seek to innovate and improve processes using new digital technologies. However, knowledge about these new technologies often resides outside a firm's boundaries. The…
Abstract
Purpose
Manufacturers seek to innovate and improve processes using new digital technologies. However, knowledge about these new technologies often resides outside a firm's boundaries. The authors draw on the concept of absorptive capacity and the literature on open innovation to explore the role of external search in the digitization of manufacturing.
Design/methodology/approach
The authors developed and distributed a survey to manufacturing firms in Switzerland, for which 151 complete responses were received from senior managers. The authors used multiple linear regressions to study the relations among the breadth and depth of external search, firms' adoption of digital technologies and operational performance outcomes.
Findings
External search depth was found to relate positively to higher adoption of computing technologies and shop floor connectivity technologies. No significant correlation was found between external search breadth and firms' adoption of digital technologies. Regarding performance outcomes, there is some evidence that increased adoption of digital technologies relates positively to higher volume flexibility, but not to increased production cost competitiveness.
Practical implications
Manufacturing firms that aim to digitize their processes can benefit from inbound open process innovation, but its utility varies for different clusters of digital technologies. Generally, the findings suggest that firms should build strong ties with a few external knowledge partners rather than surface relations with many.
Originality/value
This study contributes to the growing literature on the digitization of manufacturing with an analysis of the relation between firms' external search and their adoption of digital technologies. It adds early empirical insights to the literature on open process innovation.
Details
Keywords
Daniel Prajogo, Adegoke Oke and Jan Olhager
The purpose of this paper is to examine the value chain processes that represent the “black box” between supply logistics integration and competitive operational performance in…
Abstract
Purpose
The purpose of this paper is to examine the value chain processes that represent the “black box” between supply logistics integration and competitive operational performance in firms. To realize this objective, the authors develop a research model which comprises a series of linkages from supply logistics integration to operational outcomes using Porter’s concept of value chain and the relational view of resource-based theory as theoretical lenses.
Design/methodology/approach
The data set for testing the hypothesized relationships in this study was drawn from 232 Australian manufacturing firms.
Findings
The findings show that there is no significant direct relationship between supply logistics integration and competitive operational performance; rather, the relationship is fully mediated by inbound supply performance and internal lean production processes. Further, lean production processes have a positive effect on inbound supply performance.
Research limitations/implications
The study shows the importance of managing both internal (production processes) and external processes (logistics and supply chain) of firms’ operations in an integrated manner in which supply logistics integration act through key internal processes to impact competitive performance which the end customers actually experience.
Originality/value
This is the first study which uncovers what happens “in between” the incoming materials and the end outputs delivered by firms into the market. This “in between black box” is important in improving our understanding of how inbound supply activities are translated into outbound competitive performance outcomes.
Details
Keywords
Siyu Li, Kedi Wang, Baofeng Huo, Xiande Zhao and Xiling Cui
This study aims to investigate the impact of cross-functional coordination (cross-functional system, process and team coordination) on customer coordination (customer strategic…
Abstract
Purpose
This study aims to investigate the impact of cross-functional coordination (cross-functional system, process and team coordination) on customer coordination (customer strategic and operational coordination) and operational performance. Following the lens of information processing theory (IPT), this study examines the diverse mechanisms of cross-functional coordination practices in enhancing firms’ information processing capabilities (IPCs) to cope with the higher information processing demands resulting from customer coordination, finally improving operational performance.
Design/methodology/approach
Based on data collected from 410 Chinese manufacturers, the authors use the structural equation modeling method to test the theoretical model.
Findings
The authors found that cross-functional system coordination is positively associated with customer operational coordination (COC) but not customer strategic coordination (CSC). Cross-functional process coordination increases both customer strategic and operational coordination. Cross-functional team coordination significantly promotes CSC but not COC. Both customer operational and strategic coordination facilitate operational performance.
Originality/value
This research pioneers in identifying three dimensions of cross-functional coordination based on IPT and examine their distinct impacts on various customer coordination activities. The authors distinguish two customer coordination dimensions and reveal their effects on operational performance. This research contributes to the development of IPT. Additionally, this study provides guidelines for managers to coordinate internal departments and collaborate with external customers to enhance firms’ operational performance.
Details
Keywords
Saumyaranjan Sahoo and Sudhir Yadav
Total productive maintenance and total quality management are two lean manufacturing initiatives that are used by manufacturing plant managers to improve operations capabilities…
Abstract
Purpose
Total productive maintenance and total quality management are two lean manufacturing initiatives that are used by manufacturing plant managers to improve operations capabilities. The purpose of this paper is to investigate the effects of standalone lean practices and lean bundles on manufacturing business performance.
Design/methodology/approach
A quantitative approach was used. The survey data were drawn from 160 manufacturing organizations in India. The respondent companies were grouped on the basis of the duration of lean production in operation and then classified based on the profile of their operations strategy. The approach, based on comparative assessment between standalone lean practices and lean bundles, has been directed toward justification of lean bundles for its support to competitive manufacturing in the context of the Indian manufacturing sector.
Findings
The paper establishes the long-term effects of lean bundles in significantly improving manufacturing business performance as compared to standalone lean practices. Further findings of the study revealed the significance of the duration of lean production in operation in achieving higher levels of manufacturing business performance.
Research limitations/implications
The study is cross-sectional in nature. It would be interesting to test the analytical framework adopted for this study for more industries and in different countries. The use of subjective measures in survey questionnaire is also another limitation of the study.
Practical implications
This study offers clear implications for practitioners, proving that they should give higher emphasis on the implementation of lean bundles using total productive maintenance and total quality management practices together, to prioritize their product, production and business strategies, to achieve sustainable competitive advantage.
Originality/value
This paper empirically examines and evaluates the effect of lean practices and bundles in the context of medium- and large-sized manufacturing industries in India. Besides, there are very few studies that comparatively assess the differences in performance contribution of various lean operational strategies considering duration of implementation of lean. Also, the theoretical contribution of the study establishes the essence of integrating total productive management and total quality management for attaining world class manufacturing is of high value.
Details