Manufacturing flexibility: defining and analyzing relationships among competence, capability, and customer satisfaction

Abstract

Fast and dramatic changes in customer expectations, competition, and technology are creating an increasingly uncertain environment. To respond, manufacturers are seeking to enhance flexibility across the value chain. Manufacturing flexibility, a critical dimension of value chain flexibility, is the ability to produce a variety of products in the quantities that customers demand while maintaining high performance. It is strategically important for enhancing competitive position and winning customer orders.This research organizes literature on manufacturing flexibility and classifies it according to competence and capability theory. It describes a framework to explore the relationships among flexible competence (machine, labor, material handling, and routing flexibilities), flexible capability (volume flexibility and mix flexibility), and customer satisfaction. It develops valid and reliable instruments to measure the sub-dimensions of manufacturing flexibility, and it applies structural equation modeling to a large-scale sample (n = 273). The results indicate strong, positive, and direct relationships between flexible manufacturing competence and volume flexibility and between flexible manufacturing competence and mix flexibility. Volume flexibility and mix flexibility have strong, positive, and direct relationships with customer satisfaction.

The Effects of Demand Pull Strategies on Sustainable Development in Manufacturing Industries

“…volume flexibility and mix flexibility. These adaptable capacities, thus, upgrade consumer loyalty (Zhang et al, 2003).…”

The role of strategic and value chain flexibility in achieving sustainability performance: an empirical analysis using conventional and consistent PLS

“…Strategic flexibility enables companies to redeploy assets such as productcreating resources to meet a variety of customer expectations (e.g., meeting high ecological standards while reducing product price) and supplier demands without performance loss. Through enabling response to unanticipated changes and unexpected consequences of predictable changes (Bahrami, 1992), strategic flexibility acts as an organizing principle, which enhances the coordination of product design, production and distribution, and allows firms to take operational actions, e.g., adjust production volume or respond to ad-hoc requests made by customers (Nair, 2005;Young-Ybarra and Wiersema, 1999;Zhang et al, 2003). We therefore hypothesize: H1: Strategic flexibility is positively associated with value chain flexibility.…”

“…In order to effectively and efficiently respond to changing customer needs, including the increasing demand for sustainable offerings, firms are forced to re-design their operational processes and implement a flexible system of structures and processes across their value chain (e.g., Nair, 2005;Kolk and Pinske, 2005;Zhang et al, 2002;Zhang et al, 2003). Nidumolu et al, for instance, argue that operational innovations are central to building a sustainable value chain and, hence, conclude that companies need to develop the "ability to re-design operations" (2009, p. 61).…”

Formalisation and use of competencies for industrial performance optimisation: A survey

“…At another level, the authors show that globalisation, information availability and planning sophistication are useful competence inducers for the "delivery capability". The impact of manufacturing flexibility capabilities on performance is also analysed by Zhang et al [27] who consider customer satisfaction or by Llorens et al [28]as a critical factor in the process of strategic change.…”