The impact of sales and operations planning practices on manufacturing operational performance

There is a lack of rigorous empirical studies directly examining the impact of sales and operations planning (S&OP) practices on manufacturing operational performance. This paper aims to fill this gap by analysing a sample of 725 manufacturers from 34 countries. Hypotheses relate internal S&OP, integration with suppliers (IS) and integration with customers with manufacturing operational performance (delivery, quality and flexibility). The constructs were validated with structural equation modelling and the hypotheses were tested using multiple stepwise regression. Our findings showed a positive and moderate-to-large effect of internal S&OP on manufacturing performance, controlling for firm size, country economic development and market dynamics. There was no significant impact of supply chain integration on manufacturing performance. However, we found that IS positively moderated the relationship between internal S&OP and performance, suggesting that firms with mature IS amplify the effect of internal S&OP on performance. The study is among the first to empirically and rigorously establish the impacts of S&OP practices on manufacturing performance, using a large sample of manufacturers spanning different countries, markets and firm sizes. Results show that S&OP practices have a broad impact across several performance dimensions and are a powerful lever for generating manufacturing performance.     

On the benefits and risks of focused commitment to suppliers

This paper discusses the merits of purchasing firms of pursuing a focused commitment strategy (FCS) with suppliers. An FCS involves committing long-term investments with a limited number of suppliers to achieve superior performance. Drawing upon transaction cost theory, agency theory and the knowledge-based view, a basis is provided for comparisons of the benefits and risks of such a strategy. Using data gathered from 224 US manufacturing firms, support for the hypothesized trade-offs associated with an FCS is examined. The findings support such trade-offs, suggesting that operational benefits accrue from increasing levels of focused commitment beyond unfocused levels — but only up to a point. The results indicate that firms pursuing above-average levels of focused commitment may be subject to risks that offset transactional and scale-related benefits. Detriments from too much focused commitment erode the firm's manufacturing-based competitive performance. In addition, the evidence indicates that profitability and market share growth also suffer. The paper discusses the implications of these findings for managers and for future research.     

Lean practices implementation and their relationships with operational responsiveness and company performance: an Italian study

Although many firms report large benefits from lean implementation, a lot of scepticism still remains regarding attainable results and the possibility to apply Lean approach outside high-volume manufacturing and stable context. In this work, combining field interviews with literature review, theoretical connections have been developed among Lean manufacturing techniques, operational responsiveness and company growth performances. A conceptual model has been proposed for investigating the network of influences among lean practices (supplier management, human resource management, just-in-time and total quality management practices), operational responsiveness (Product mix variety, Product innovation and Time effectiveness) and company growth performances in Italian companies. Using structural equation modelling, a second-order confirmatory factor analysis has been used to test the hypothesised relationships in the structural models. This study highlights that the operational responsiveness is only partially connected to a Lean strategy of a company. Indeed, the lean practices implementations are negatively influenced by product mix variety and innovation, while positively influenced by time effectiveness variables. Moreover, product mix variety and time effectiveness are the main characteristics of the operational responsiveness that positively influences company growth performances. So time effectiveness could be considered as a mediator between Lean best practices and firm growth. Moreover, no direct relationship has been found between lean bundles and firm’s performances. Lack of resources and mainly poor communication and managers’ commitment and support seem to be the main obstacles of lean implementation and success.     

Evaluating and developing resource-based operations strategy for competitive advantage: an exploratory study of Finnish high-tech manufacturing industries

Firms are struggling to achieve and maintain the competitive advantage in today’s turbulent business environment. How can we evaluate and (re)develop strategic initiatives that put into place operational capabilities to provide new sources of firm-level competitive advantage? This paper tries to explore the practical intersection of operations management and strategy from resource-based view by evaluating and developing the sustainability level of operational competitive advantage, that how well the resource-based strategy can support its operations. It develops a theoretical approach to integrate the core factors, which determine operational competitiveness performance – manufacturing strategy and its supporting resource allocation, into conceptual analytical models. The models utilise sense and respond (S&;R) methodology for dynamic decision-making to detect and adjust resource allocation and in turn optimise the resource-based strategy in order to develop the operational competitive advantage in a sustainable manner. Eighteen case companies in Finnish high-tech manufacturing industries are selected for in-depth study and analysis with proposed models to conclude how the optimal adjustments of resource-based strategy by supporting its operations can lead to sustainable competitive advantage (SCA). Constantly optimising resource allocation aligning with resource-based operations strategy supported by the S&;R idea of agile strategy implementations is proposed as the unique SCA.     

Barriers to the adoption of green operational practices at Brazilian companies: effects on green and operational performance

The objective of this paper is to verify to what degree the internal and external barriers (I/EBs) to environmental management affect the adoption of green operational practices (GOPs) and to determine whether they influence the firms’ operational and green performance in a sample of Brazilian companies. A conceptual framework with 8 hypotheses is proposed and tested at 75 companies using Partial Least Squares-Structural Equation Modeling (PLS-SEM) with WarpPLS 4.0. The main results show that (a) the proposed framework obtained an adequate statistical adjustment, (b) the internal barriers (IBs) are more significant than the EBs when adopting GOPs, (c) GOPs relate directly to the firms’ green and operational performance (OP), (d) the IBs also indirectly influence the firms’ green and OP and (e) the firm size does not significantly influence its green and OP. This work contributes to the literature by showing that companies which are looking for green competitive advantages should try to reduce their IBs. Also, policy-makers should pay attention not only to legislation that promotes ecological modernisation, but also to create a strong set of initiatives to overcome IBs, regardless of the size of the firms.     

Agile workforce evaluation: a framework for cross-training and coordination

This paper outlines approaches for assessing and classifying manufacturing and service operations in terms of their suitability for use of cross-trained (flexible) workers. We refer to our overall framework as agile workforce evaluation. The primary contributions of this paper are: (i) a strategic assessment framework that structures the key mechanisms by which cross-training can support organizational strategy; (ii) a tactical framework that identifies key factors to guide the selection of an architecture and worker coordination policy for implementing workforce agility; (iii) a classification of workforce agility architectures; (iv) a survey of a broad range of archetypical classes of worker coordination policies; (v) a survey of the literature with an operational perspective on workforce agility; and (vi) identification of opportunities for research and development of architectures for specific production environments.     

Technology alignment and business strategy: a performance measurement and Dynamic Capability perspective

Rapid changes in market structures and technology lead to misalignment between strategy and operations. Whist this phenomenon is most prevalent in technology-based manufacturing industries, utility organisations (e.g. electricity and telecoms) provide a useful context to explore the Performance measurement (PM) and technology alignment challenges from a Dynamic Capabilities Theory perspective where there is a progressive shift towards deregulated markets. The aim of this paper is twofold: first, to explore the role of Dynamic Capabilities Theory and PM approaches in improving the alignment between business strategy and technology strategy (Level 1 alignment); second, to explore the role of Dynamic Capabilities Theory and PM approaches in aligning technology strategy with operational technology routines and practices (Level 2 alignment). In the absence of overarching theory, an inductive approach draws upon Dynamic Capabilities theory. Four longitudinal case studies are used leading to the development of a conceptual framework and propositions for multilevel technology alignment. Data from 38 interviews and 8 separate focus groups, documentation and participant observations (over a three-year period) are used. The theory-building process shows the need to identify and develop PM-based technology alignment Dynamic Capabilities (PM-DCs) which help in improving and maintaining alignment between business strategy and technology strategy (Level 1 alignment) and between technology strategy and technology practices (Level 2 alignment). This approach requires critically reflective action-learning approaches to identify and nurture these PM-DCs.     

Post-Entry Product Introduction: Who Explores New Niches?

Where do innovative products come from? Why do some firms address new market niches and others do not? The literature has rarely blended the concept of innovativeness of a product at the market level with the coherence of the product portfolio at the firm level. In this paper, we examine whether the introduction of products that are highly innovative occurs in firms that are very differentiated, both in terms of target niches and in terms of technological competencies, or rather in firms that focus on specific market segments and that have a limited technological capability. The results show that the introduction of products that are new to the market generally occurs in firms that introduce many products in few market segments and are characterized by a set of specialized technological and market competencies. At least in this industry, the myth of the small specialized niche player does not hold. Implications have a positive relevance to assess firms' behaviour in a given market. From the welfare point of view, this paper helps disentangle monopolistic power generated by truly new products and simple versioning of the product.     

A synergistic analysis of joint JIT-TQM implementation

Both JIT and TQM have provided significant paradigm shifts in management philosophy to improve organizational effectiveness in today's competitive and ever-changing world market. Yet empirical studies correlating JIT, TQM and operational performance are still underdeveloped. Using a sample of 379 US computer and electronics companies, this study attempts to analyse the workforce practices and synergistic benefits of joint JIT-TQM implementation by comparing four groups of companies based on their implementation status of JIT and TQM.     

Profitability and Speed of Foreign Market Entry

This research explores the relationship between firm profitability and actual speed of foreign market entry. Results suggest that profitability has an inverted U-shaped relationship with actual speed of foreign market entry, in the context of large US corporate law firms entering China. This result supports the idea that firms with both the need and resources to expand into foreign markets rapidly will do so, while laggards will lack either the resources or need to enter markets. Results also suggest that previously established offices in culturally similar markets, larger firm size, firm infancy, and prior international experience hasten market entry. Alternatively, limited organizational slack and concentrated practices delay market entry. Unexpectedly, prior entry of competitors appears to represent a deterrent to rapid entry. Additionally, while regulatory reforms on foreign law firms in China allowed for wider geographic access, they also increased operating restrictions, slowing entry speeds. Finally, results suggest that intense home-market competitive intensity may divert or decrease resource commitments to rapid foreign expansion.     

The implementation of an activity-based costing collaborative planning system for semiconductor backend production

While the market turns to an environment with low profit margins for semiconductor backend operations, it is hard for an independent firm to survive today. Forming strategic alliances or integrating an enterprise's internal firms by means of collaborative planning/operations to gain competitive advantage is inevitable. This paper presents the development of an activity-based costing collaborative production planning system (ABC/CPPS) to help production planners to estimate the manufacturing profit of semiconductor backend turnkey (combined IC assembly and testing) operational services at the early stage of order release to production line in a collaborative context. The estimation is under the real constraints of production resources. A predicate/transition net (Pr/Tr net) is used to simulate and implement the activity-based costing (ABC) model with the dynamic characteristics of a production line incorporated. A financial measure, profit, is used to supplement and indicate the consequence of the planning result and link the view to the enterprise's financial vision.     

Break on Through: Sources and Determinants of Product and Process Innovation among UK Construction Firms

While construction is often seen as a low‐technology sector, it has witnessed substantial changes in practices, processes, technology and performance over the past 20 years. Understanding the sources of these changes is important for innovation strategy and policy to improve performance within the sector, and because it produces the capital goods—buildings and structures—to enable other sectors to develop. Logistic regression is applied to data from the UK Innovation Survey to examine sources of product and process innovation among construction firms. Results show that working with customers, suppliers and having a broad market orientation can help construction firms break through the confines of their particular industrial context. The paper concludes by exploring implications of these findings for policy and theory and by considering questions for further research.     

How big data and analytics reshape the wearable device market – the context of e-health

The wearable device can be a key link between health care and big data and analytics (BDA). The benefits of BDA in health care have been widely acknowledged, but the uncertainty of the implementation of BDA has led some firms to hesitate in adopting this technology. In this research, we are keen to answer the key questions of whether the wearable device firms would adopt the BDA strategy, and how much effort they would put into it. We propose a competition model between the wearable device firms with and without BDA strategies, and consider the consumer’s preference towards BDA and network effects. Our model demonstrates that the investment on BDA directly affects the firm’s equilibrium price, market share and profit and at the same time, this strategy also affects the rival’s performances. When the firm with BDA strategy adopts different competition strategy: conservative or expansive, the outcomes of market are different. We also find that different market structures, fully covered and partially covered, have different impacts on the firms’ competition when the consumers have heterogeneous preference on BDA strategy.     

Price and lead time differentiation,capacity strategy and market competition

We study a duopoly market in which customers are heterogeneous, and can be segmented as price or time sensitive. Each firm tailors (differentiates) its products/services for the two customer classes solely based on guaranteed lead time and the corresponding price. Our objective is to understand how competition affects price and lead time differentiation of the firms in the presence of different operations strategy (shared versus dedicated capacity), product substitution and asymmetry between the competing firms. Our results suggest that when firms use dedicated resources to serve the two market segments, pure price competition always tends to decrease individual prices as well as price differentiation, irrespective of the market behaviour. Further, the effect of competition is more pronounced when customers are allowed to self-select, thereby introducing substitutability between the two product options. On the other hand, when firms compete in time, in addition to price, the effect of competition on product differentiation depends crucially on the behaviour of the market. Our results further suggest that the firm with a larger market base should always maintain a larger price and lead time differentiation between the two market segments. Similarly, the firm with a capacity cost advantage should also maintain a larger lead time differentiation.     

Knee Deep in the Big Muddy: The Survival of Emerging Market Firms in Developed Markets

This study of Latin American banks located in the United States employs a resource-based framework to explain how subunits of emerging market firms can overcome the challenges of operating in a developed market. Our results show that an EMF subunit can draw upon ethnic identity as a valuable and costly-to-imitate resource to achieve competitive parity in the developed market. Ethnic resources can be generated not only from ethnically similar customers but also from ethnically similar competitors in the local market. In addition, the parent firm’ level local and non-local resources can help to achieve competitive parity for the EMF subunits in that country, which in turn positively influences survival. However, over expansion can lead to spreading local and non-local resources too thin, thus adversely affecting survival.

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A hierarchical fuzzy TOPSIS approach to assess improvement areas when implementing green supply chain initiatives

Implementing green supply chain management (GSCM) initiatives can generate more business opportunities for firms. It also requires changes in firms’ operational capabilities and resources that may have an adverse effect on firms’ operations performance. In order to achieve sustainable economic and environmental performance, it is essential for companies to evaluate different green initiatives and assess improvement areas when implementing green initiatives. This study proposes a fuzzy hierarchical TOPSIS approach to support such an assessment. It enables decision makers to better understand the complete evaluation process and provide a more accurate, effective and systematic decision support tool. An illustrative case is presented to help researchers and practitioners understand the importance of developing an appropriate organisation strategy in implementing green practices.     

Supplier development: communication approaches,activities and goals

Operations managers rely on the purchasing function to obtain production inputs from suppliers and to ensure supplier performance. The link between supplier development activities performed by buying firms with their suppliers, in terms of operational outcomes and impact on competitive advantage for the buying firm has been well documented. However, a buying firm should, prior to setting up a supplier development program and investing in supplier development activities, establish goals it wants to achieve and determine how to achieve these goals. Until now, supplier development goals in general and their relationship with supplier development activities have received little research attention. The results from this empirical study suggest that the relationship between the goal to improve a supplier's capabilities and knowledge transfer from the buyer to the supplier firm is moderated by the degree of human interaction. Buying firms pursuing the strategy to improve supplier capabilities rely more intensively on training and co-location of buyer and supplier employees to leverage the knowledge transfer to the supplier firm.     

Performance measurement of cross-culture supply chain partnership: a case study in the Chinese automotive industry

This study explores a performance measurement system for a dynamic supply chain partnership in a cross-cultural context. An initial framework is constructed by reviewing the existing literature, followed by an in-depth case study in the Chinese automotive industry, where the framework is refined to address the multi-cultural setting. A performance measurement, system which includes the relationship strategy and operational measurement criteria for a supply chain partnership, has been developed. The relationship strategy contains elements of strategy orientation, management style, interdependence, mutual organisational characteristics and common goals. The operational measurement criteria consist of commitment, trust, communication behaviour, information sharing, participation decision, quality, production performance, delivery, cost, supplier strength, attitude, compromise and loyalty. The last three operational measurement criteria are found to be particularly relevant to the cross-cultural feature. While existing studies tend to focus on either specific measures or individual organisations, this paper for the first time proposes a comprehensive framework to measure the performance of supply chain partnerships. The cross-cultural perspective provides a further unique view on how a performance measurement system can be responsive to the dynamics in practice.     

A real-options-based analysis for supply chain decisions

Flexibility allows firms to compete more effectively in a world of short product life cycles, rapid product development, and substantial demand and/or price uncertainty. We develop a supply chain model in which a manufacturing firm can have the flexibility to select different suppliers, plant locations, and market regions and there can be an implementation time lag for the supply chain operations. We use a real options approach to estimate the value of flexibility and to determine the optimum strategy to manage the flexibility under uncertainty in the currency exchange rate. To price the operational flexibility, we develop a Monte Carlo simulation technique that is able to incorporate a large number of variables into the valuation. We show that without considering time lag impact, the value of the operational flexibility can be significantly overestimated.     

基于服务价格和质量承诺的服务商竞争策略研究

现有研究仅关注单一服务商的质量承诺决策,而忽视多个服务商关于服务价格和质量承诺的竞争策略。为弥补这种研究不足,本文的研究并不仅停留在单一的服务承诺研究,而是扩展到服务价格层面进行综合研究,以此探讨服务商竞争策略。本文构建3种竞争模型,并运用最优化方法研究,得到结论如下。1) 在基于服务价格的竞争模型中,当质量承诺水平一定时,一旦有服务商涨价,其他服务商会制定相同的决策。然而,一旦有服务商提高质量承诺水平,其他服务商会制定降价决策予以应对。2) 在基于质量承诺水平的竞争模型中,当服务价格一定时,一旦有服务商提高质量承诺水平,其他服务商会适当地降低质量承诺水平来减少服务失败时的补偿。一旦有服务商从服务价格层面提升竞争力,那么,为应对这种竞争策略,其他服务商就会从质量承诺方面进行补偿。3) 本文基于服务竞争策略研究而建立了竞争模型,从模型研究中发现,各个服务商之间必然存在纳什均衡。本文对服务市场竞争环境下,关于服务价格和质量承诺的竞争策略的制定有一定的实践指导意义。