On Decisions for Integration Implementation: An Examination of Complementarities Between Product‐Process Technology Integration and Supply Chain Integration

Research has shown that both product‐process technology (PPT) integration and supply chain integration efforts produce operational benefits, yet synergies between these types of integration are not well understood. This article empirically examines strategic customer integration and supplier integration as complementary activities for PPT integration, with the aim of helping manufacturing plant managers to intelligently implement mutually supportive types of integration. We set two conditions for establishing complementarity: (i) one type of strategic integration must positively influence the adoption of another and (ii) the two types of strategic integration must exhibit a synergistic fit with respect to manufacturing plant capabilities. We test these conditions using survey results representing 224 manufacturing plants. The findings show positive complementarities between PPT integration and supplier integration with respect to quality, delivery, and process flexibility. Also, positive complementarities exist between PPT integration and customer integration with respect to quality and new product flexibility. The results extend the emerging theory of strategic value chain integration and provide guidance to manufacturing managers who wish to assemble strategic integration policies.     

Definitions and linkages between operational and strategic flexibilities

This paper aims at clarifying the concept of strategic flexibility, starting from that much more common of manufacturing flexibility (or operational one). After characterizing the dimensions of the latter, a classification of strategic flexibility is presented which distinguishes four categories. The measures of strategic flexibility are also investigated. Then two analogies are pointed out with the operational flexibility. The first, of the cause-effect type, is on two levels: at the business level, the operational flexibility estimates the variation of practices, while the strategic flexibility measures the effect obtained on performances; at the corporate level, the operational flexibility estimates the variation of competences, while the strategic flexibility evaluates the change in business. The second analogy, related to the classification variables, permits the main types of operational and strategic flexibilities to be placed in a single framework. So this study seeks to provide a framework—which has not been proposed in prior literature—for analyzing and evaluating the correlated concepts of operational and strategic flexibilities, to create a theoretical foundation for future research and empirical testing.     

Causal Linkages in Supply Chain Management: An Exploratory Study of North American Manufacturing Firms

In this paper we investigate the key causal linkages in supply chain management. We propose a conceptual framework and test this framework on data from 215 North American manufacturing firms using structural equation modeling techniques. Three major research issues are addressed in this study: Do sourcing decisions affect the degree to which firms achieve manufacturing goals of cost, flexibility, dependability, and quality? Does the degree of manufacturing goal achievement lead to higher customer responsiveness? Does the degree of manufacturing goal achievement lead to higher internal manufacturing performance? The study examines the relationship among sourcing decisions, manufacturing goals, customer responsiveness, and manufacturing performance. The results support the notion that an integrated supply chain involves aligning sourcing decisions to achieve manufacturing goals that are set to respond favorably to the needs of customers.     

战略采购对制造企业知识获取的影响研究:供应商网络视角

以我国制造企业为研究对象,从供应商网络视角出发,探索了战略采购对制造企业知识获取的影响。构建了包括战略采购、供应商网络嵌入性、制造企业与供应商互动、制造企业知识获取之间关系的概念模型并提出了相应的理论假设。采用结构方程模型进行验证,实证结果表明战略采购对关系嵌入性、结构嵌入性和制造企业与供应商互动均有显著的正向影响,并进而通过它们显著正向影响制造企业知识获取。     

The Influence of Cost and Quality Priorities on the Propensity to Outsource Production*

Outsourcing of production has escalated over the past decade due to unprecedented competition and worldwide access to low‐cost labor markets. This article examines how cost and quality priorities—two key attributes of manufacturing strategy—influence a manufacturer's propensity to outsource. By doing so, we bridge the existing gap between research on manufacturing strategy and firm boundaries. We develop a theory‐based model that links a manufacturer's cost and quality priorities to its plans to outsource production. Our empirical analyses, based on survey data obtained from 867 manufacturing business units, control for firm‐specific factors previously shown to impact outsourcing, including asset specificity, uncertainty, and current capabilities in cost and quality. We found that the competitive priority placed on cost played an integral role in sourcing decisions, while, surprisingly, conformance quality priorities did not. The cost result is consistent with our expectations and observations in practice. The significant effect of cost priority on outsourcing shows that any theory of firm boundaries that fails to consider competitive priorities is incomplete. The finding regarding quality, which was counter to our expectations, may partially explain why there is an emergence of so many nonconforming products associated with outsourcing. Taken together, our results provide theoretical insights for future research into how manufacturing managers can improve their decision making on outsourcing production.     

Technology sourcing,appropriability regimes,and new product development

This paper tests the influence of technology sourcing and appropriability regimes on new product development, using data from a survey of 254 Chinese firms. Our results demonstrate that both internal technology development and external technology sourcing can improve a firm's new product development. Furthermore, although both legal appropriability regimes and strategic appropriability regimes have positive relationships with new product development, their moderating effects are different. Specifically, it is suggested that firms incorporate legal appropriability regimes when using external technology development and strategic appropriability regimes when using internal technology sources, to improve new product development.     

A Theoretical Model of Manufacturing Lead Times and Their Relationship to a Manufacturing Goal Hierarchy*

In recent years, manufacturing firms have realized that a new, higher level of global competition causes them to compete simultaneously on multiple manufacturing goals, such as quality, delivery, cost, and flexibility. In response to this realization, considerable research now focuses on the relationship of manufacturing improvement programs to manufacturing goals. However, to date, this research has not investigated the specific underlying statistical relationships between manufacturing goals and the shop floor. This study investigates manufacturing lead time linkages with manufacturing programs and manufacturing goals. The basic purpose of this study is to understand and explain how programs affect the elements of manufacturing lead time and how manufacturing lead time affects manufacturing goal capabilities. By understanding these linkages, managers can logically trace the effects of specific programs to their eventual effects on manufacturing goal capabilities. This study's most important finding is that statistical variations in the elements of lead time cause a tendency for certain manufacturing goals to be more difficult to control and achieve than others because of canonical relationships of lead time variances. To control these lead time variances, successful firms concentrate their early program targets first on achieving “fitness for use” quality, followed by delivery reliability, short delivery lead time and cost, current product flexibility, and lastly, new product flexibility. This study mathematically illustrates which improvement programs most affect manufacturing goals through their relationship to manufacturing lead time variance reduction. It suggests that firms improve goal performance by initially targeting improvement through setup time reduction programs, defect reduction programs, and preventive maintenance programs, to facilitate quality improvements. By targeting specific programs and their related lead time variances, firms improve their manufacturing facility competitiveness with minimum obstacles.     

Sourcing Strategy,Supplier Relationships and Firm Performance: An Empirical Investigation of UK Organizations

This article conceptualizes and empirically examines buyer–supplier relationships in respect of supply sourcing strategies, relationship characteristics and firm performance. Two sourcing strategies available to organizations are examined, critical and leverage, which in turn, influence the approach to managing the supplier relationship (arms‐length or collaborative). We argue that different relationship approaches are appropriate to achieving different performance outcomes. A structural equation model, using a sample of 142 manufacturing firms based in the United Kingdom, is used to test this hypothesized model. The results indicate that a critical sourcing strategy requires collaborative supplier relationships in order to achieve higher relationship and business outcomes, while leverage sourcing strategies have a direct impact on these same performance outcomes. In addition, a leverage strategy was associated with increased levels of supplier power, though this power was found not to have a significant effect on performance. Our study provides support for the importance of aligning sourcing strategies to particular supplier relationship approaches in order to improve firm performance. Managerial implications of these findings and future directions for research are then offered.     

Selecting sourcing partners for a make-to-order supply chain

Make-to-order manufacturers face an idiosyncratic and complex situation in the sourcing selection process. Although they can source from several key suppliers, each order requires custom key parts that cannot be stocked. Our research provides a decision model to facilitate the sourcing process for these manufacturers using information about their sourcing partners’ cost and processing time. The manufacturer can calculate the total cost and on-time probability for all possible combinations of certified suppliers and key part allotments to obtain a sourcing portfolio with several sourcing alternatives for a desired service level. The portfolio allows the manufacturer to make trade-offs between cost and reliability to finish the job on time. Additionally, the portfolio can be obtained for a given due date or for reduced due dates in a competitive bid situation. The portfolio approach allows the manufacturer to maintain control over the sourcing selection process by partnering with sourcing members to keep costs low without losing the needed flexibility to meet customer demands.     

Examining the Impact of Interorganizational Systems on Process Efficiency and Sourcing Leverage in Buyer–Supplier Dyads

Manufacturing firms are increasingly seeking cost and other competitive advantages by tightly coupling and managing their relationship with suppliers. Among other mechanisms, interorganizational systems (IOS) that facilitate boundary‐spanning activities of a firm enable them to effectively manage different types of buyer–supplier relationships. This study integrates literature from the operations and information systems fields to create a joint perspective in understanding the linkages between the nature of the IOS, buyer–supplier relationships, and manufacturing performance at the dyadic level. External integration, breadth, and initiation are used to capture IOS functionality, and their effect on process efficiency and sourcing leverage is examined. The study also explores the differences in how manufacturing firms use IOS when operating under varying levels of competitive intensity and product standardization. In order to test the research models and related hypothesis, empirical data on buyer–supplier dyads is collected from manufacturing firms. The results show that only higher levels of external integration that go beyond simple procurement systems, as well as who initiates the IOS, allow manufacturing firms to enhance process efficiency. In contrast, IOS breadth and IOS initiation enable manufacturing firms to enhance sourcing leverage over their suppliers. In addition, firms making standardized products in highly competitive environments tend to achieve higher process efficiencies and have higher levels of external integration. The study shows how specific IOS decisions allow manufacturing firms to better manage their dependence on the supplier for resources and thereby select system functionalities that are consistent with their own operating environments and the desired supply chain design.     

存在信息更新时的双源采购和后备生产结合策略研究

在现实的采购运作中,双源采购和后备生产是两种最常见的风险应对策略。本文在考虑信息更新的情况下,探讨了一个两阶段动态采购决策模型：第一阶段,制造商向存在供应风险的一个或两个主供应商订货;第二阶段,制造商根据主供应商风险信息的更新,决定是否向供应可靠但价格较高的后备供应商订货。本文得到了两阶段的最优采购策略,分析发现,当固定采购成本较低时：若潜在市场需求较小,双源采购将排斥后备生产;若潜在市场需求较大,双源采购和后备生产共存;若潜在市场需求适中,后备生产可能排斥双源采购,两者也可能共存。特别地,在潜在市场需求适中时,可靠性改进概率的增大或后备供应商生产成本的降低,将使后备生产趋于排斥双源采购;反之,可靠性改进概率的减小、固定采购成本的降低或后备生产成本的增加,将使两者趋于共存。     

Managing the International Strategic Sourcing Process as a Market-Driven Organizational Learning System*

This study examines the effects of market-driven organizational learning on a select set of strategic sourcing outcomes involving the sourcing function of a Fortune 500 multinational corporation. The focus is on the dyadic activities and relationships between the domestic and international strategic business units (SBUs) and the corporate buying center. The hypothesized relationships are tested on the overall sample and based on a two-by-two matrix framework defined by international versus domestic settings and frequent versus infrequent sourcing scenarios. Based on a sample of 179 domestic and 167 international SBUs, the results suggest that market-driven organizational learning in the strategic sourcing units influences customer satisfaction, relationship commitment, and cycle time of the sourcing process. However, while the set of learning orientations appears to be strategically robust across the four quadrant scenarios (moderator settings), the sourcing situations differ somewhat in the specific tactical learning orientations preferred.     

Sequential and Simultaneous Decision Making for Optimizing Health Care Resource Flexibilities

Health care administrators commonly employ two types of resource flexibilities (demand upgrades and staffing flexibility) to efficiently coordinate two critical internal resources, nursing staff and beds, and an external resource (contract nurses) to satisfy stochastic patient demand. Under demand upgrades, when beds are unavailable for patients in a less acute unit, patients are upgraded to a more acute unit if space is available in that unit. Under staffing flexibility, nurses cross‐trained to work in more than one unit are used in addition to dedicated and contract nurses. Resource decisions (beds and staffing) can be made at a single point in time (simultaneous decision making) or at different points in time (sequential decision making). In this article, we address the following questions: for each flexibility configuration, under sequential and simultaneous decision making, what is the optimal resource level required to meet stochastic demand at minimum cost? Is one type of flexibility (e.g., demand upgrades) better than the other type of flexibility (e.g., staffing flexibility)? We use two‐stage stochastic programming to find optimal resource levels for two nonhomogeneous hospital units that face stochastic demand following a continuous, general distribution. We conduct a full‐factorial numerical experiment and find that the benefit of using staffing flexibility on average is greater than the benefit of using demand upgrades. However, the two types of flexibilities have a positive interaction effect and they complement each other. The type of flexibility and decision timing has an independent effect on system performance (capacity and staffing costs). The benefits of cross‐training can be largely realized even if beds and staffing levels have been determined prior to the establishment of a cross‐training initiative.     

An aggregate production planning framework for the evaluation of volume flexibility

Flexibility in manufacturing has been identified as one of the key factors to success in the marketplace. Many types of flexibility have been identified in the literature among which volume flexibility is one of the most important. Volume flexibility of a manufacturing system is defined as its ability to be operated profitably at different overall output levels. Volume flexibility permits a manufacturing system to adjust production upwards or downwards within wide limits. In this paper, we develop an aggregate production planning model for volumeflexible production systems. The model can be used with a Monte Carlo simulation to evaluate the optimal level of investment in volume flexibility for a firm operating under a given set of market conditions. In addition, the model can be used to develop some conclusions about the relationship between the value of volume flexibility and the cost of holding inventory, the cost of shortage, forecast accuracy, and the length of the planning horizon.     

Manufacturing Practices and Strategy Integration: Effects on Cost Efficiency,Flexibility, and Market‐Based Performance

Manufacturing plant managers have sought performance improvements through implementing best practices discussed in World Class Manufacturing literature. However, our collective understanding of linkages between practices and performance remains incomplete. This study seeks a more complete theory, advancing the idea that strategy integration and enhanced manufacturing capabilities such as cost efficiency and flexibility serve as intermediaries by which practices affect performance. Hypotheses related to this thesis are tested using data from 57 North American manufacturing plants that are past winners and finalists in Industry Week's“America's Best” competition ( Drickhamer, 2001 ). The results suggest that strategy integration plays a strong, central role in the creation of manufacturing cost efficiency and new product flexibility capabilities. Furthermore, strategy integration moderates the influences of product‐process development, supplier relationship management, workforce development, just‐in‐time flow, and process quality management practices on certain manufacturing capabilities. In turn, manufacturing cost efficiency and new product flexibility capabilities mediate the influence of strategy integration on market‐based performance. These findings have implications for practice and for future research.     

Impacts of demand and supply factors on the capacity scheduling performance of logistics service supply chain with mass customisation service modes: an empirical study from China

This paper studies the influence of the demand–supply environment on the capacity scheduling performance of the logistics service supply chain. According to the key characteristics of the demand–supply environment, the cases of five Chinese companies were introduced and cross-analysed, then research hypotheses were developed. After receiving 154 valid questionnaires and testing our hypotheses, some key conclusions were obtained. From the aspect of demand, there is a positive correlation between the customised levels of demand and the scheduling cost of logistics service integrators but a negative correlation between the customised levels of demand and the scheduling flexibility; From the aspect of supply, a higher self-support ratio of logistics source and a higher sourcing integrity of logistics service integrators will lead to a higher scheduling cost and a lower scheduling flexibility; a whole-process performance evaluation is a moderator, which will positively improve the impact of the whole process scheduling performance.     

Hierarchische Planung für industrielle Logistikdienstleister

In this paper a planning and control system for logistics service providers (called LPS system) is developed under consideration of their specific flexibility potentials. Due to the complexity of such planning decisions (different planning levels and data quality of these levels as well as time horizons etc.), a multi-stage, hierarchical planning system is proposed which minimizes the relevant costs under consideration of the flexibilities. The advantage of a hierarchical planning concept consists in a limited planning complexity because otherwise data collection and solution development would lead to unsolvable problems in practice. The results of using LPS systems for a real-life case show a significant pay-off for logistics service providers due to the remarkable cost savings by applying a hierarchical planning concept.     

Production systems and supplier selection: a multi-phase process model

Abstract

Purpose: This paper presents a combined multi-phase supplier selection model. The process repeatedly revisits the criteria and sourcing decision as the development process continues. This enables a structured adoption of product and production system innovation from strategic suppliers, where previously the literature purely focuses on product innovation or cost reduction. Design/methodology/approach: The authors adopted an embedded researcher style, inductive, qualitative case study of an industrial supply cluster comprising a focal automotive company and its interaction with three different strategic stamping suppliers. Findings: Our contribution is the multi-phased production and product innovation process. This is an advance from traditional supplier selection and also an extension of ideas of supplier-located product development as it includes production system development, and complements the literature on working with strategic suppliers. Specifically, we explicitly articulate the previously unreported issue of whether a supplier chosen for its innovation capabilities at the start of the new product development process will also be the most appropriate supplier during the production system development phase, when an ability to work collaboratively may be the most important attribute, or in the large-scale production phase when an ability to manufacture at low unit cost may be most important. Originality/value: The paper identifies a multi-phase approach to tendering within a fixed body of strategic suppliers which seeks to identify the optimum technological and process decisions as well as the traditional supplier sourcing choice. These areas have not been combined before and generate a valuable approach for firms to adopt as well as for researchers to extend our understanding of a highly complex process.     

基于战略角色的制造企业竞争优先权选择研究

在全球制造网络的背景下,从不同战略角色的角度研究了制造企业的竞争优先权选择问题。在对企业战略角色和竞争优先权理论文献分析的基础上,提出了研究命题:对处于不同战略角色的制造企业来说,其选择的竞争优先权也不尽相同。在2009年国际制造业战略调查数据的支持下对上述命题进行实证,数据分析结果显示,质量、服务、创新、环保、社会责任要素对3类战略角色企业赢得订单的重要程度有明显差异。在此基础上,提出了基于战略角色的制造企业竞争优先权图谱,以供制造企业的竞争优先权选择参考。