Article 8. A study of the effect of manufacturing proactivity on business performance, Ayleen Gaviria

The success of manufacturers depends on capabilities derivaded on failures and imperfections

The objective

It is analyse the role of this manufacturing proactivity

Understand the tendency of the company to reproduce the most advanced and promising production management practices

The interest of this study is therefore based on three things

First

The paper explores the behavioural dimensions underlying the implementation of advanced production practices

Second

This paper raises different causal explanations of the relationship between manufacturing proactivity and performance

Third

This research combines subjective measures of performance based on perceptions with objective data obtained from secondary sources.

is defined as “the tendency of an organisation to implement all those practices, tools or management systems considered the most advanced, modern and promising within its production and operations function”

Acccording to ward, there are two dimensions

the degree of involvement of manufacturing in the strategic processes of the business unit

the degree of commitment to a long-term programme of investments in manufacturing structure and infrastructure aimed at building capabilities in anticipation of their need.

Is undertood as the business performance, in some inoperational terms(quality, cost, flexibility, reliability, or speed) as well as in financial terms (profit and returns)

There are two reasoning

Advanced manufacturing practices and business performance

It is through the literature

The implementation of innovative work practices

include employee training

employee participation

involvement through problem-solving teams

Manufacturing proactivity, involvement of the production function in strategic processes, and alignment between production capabilities and strategic objectives

Hayes and Wheelwright (1984) distinguish four stages in the evolution of manufacturing’s strategic role

In stage I, internally neutral, the production function is considered as a necessary burden that is difficult to change

In stage II, externally neutral, some modifications are introduced in the production function in order to, at least, not harm the business strategy

In stage III, internally supportive, a production strategy is developed in order to support the business strategy

In stage IV, externally supportive, the production function constitutes a fundamental mainstay of the business strategy and is involved in major strategic decisions topic

Those companies showing a higher degree of production proactivity are probably in stage IV or close to this stage. In fact, in what can be interpreted as production proactivity

The empowerment of the production and operations function is intuited to have positive competitive effects on an organisation

Better business performance in operational and financial terms might generate a desire to maintain such leadership and, as a consequence, an interest in implementing the most advanced and promising practices in the production function

Longitudinal studies should be conducted in future research in order to take into account the possible time lags between implementation and performance change

The integration of two important variables: cultural proactivity andtechnical proactivity

This result indicates that the implementation of tools and techniques such as JIT, CAD/CAM or integrated information systems affects the perceived performance interms of quality, reliability and flexibility

Data

The database was taken from a postal survey

The approached population consisted of medium and large Spanish companies in three industrial sectors: chemical products (except pharmaceutical companies), electronic and electrical equipment, and furniture and fixtures

the questionnaire was accompanied by a presentation letter and a post-paid envelope for return

Measures

Manufacturing proactivity

each company was asked to choose their degree of agreement with ten assertions referring to the implementation of such practices

The underlying manufacturing proactivity

It was performed, which capture 49.498 percent of the variance

In the Varimax orthogonal rotation

The first factor

It measures a cultural dimension of manufacturing proactivity

It implies a greater cultural change within the organisation and a high score on this factor means

that the company thinks of employees as resources instead of costs, considers their suppliers as collaborators rather than competitors, and promotes dynamism and continuous improvement

The second factor

It measures a technical dimension

mainly takes in practices that involve the adoption of concrete tools or techniques in the production plant as

CAD/CAM systems

integrated information systems

advanced manufacturing technologies

JIT systems characterises those companies with high scores on factor 2

Performance

Managers marked on a five-point scale whether they considered their companies very inferior

Very inferior

Somewhat inferior

Equivalent

Somewhat superior

Very superior

Analysis

Four control dimensions were added to the group of independent variables

Company size – measured as hundreds of employees

Plant equipment age – measured by the number of five-year intervals from the acquisition of the main productive equipment in use

Company internationalisation – included by using a binary variable distinguishing those companies which are part of multinational groups

The companies belonging to international groups tend to be the larger and more proactive companies

The industrial sector – which required the introduction of two binary variables distinguishing the chemical and electronic and electrical equipment sectors, respectively

The electronic sector concentrates the largest companies with the newest equipment and the highest levels of technical proactivity