Manufacturing Proactiveness and Performance

Abstract

Since Skinner's [40] landmark article depicting the manufacturing function a s the "missing link" in corporate strategic processes, a portion of the blame for inferior performance in many f m s has been attributed to the subordinate strategic position of manufacturing. It has been argued that part of the solution to misalignments between the capabilities possessed by manufacturing and the requirements dictated by customers is for manufacturing to take a more proactive stance. However, little research has been reported which examines manufacturing proactiveness empirically. In this paper, we address this gap by developing an operational definition of manufacturing proactiveness and testing empirically whether a link exists between proactiveness and performance based on data collected from a sample of manufacturers.Based on the manufacturing strategy literature, we identify two major dimensions of manufacturing proactiveness: (1) the degree of manufacturing's involvement in the strategic processes of the business unit; and (2) the degree of commitment to a long-term program of investments in manufacturing structure and infrastructure aimed at building capabilities in anticipation of their need. We develop reliable scales for measuring each of the dimensions of proactiveness and use the data to provide evidence of a clear link between manufacturing proactiveness and business performance. We show that investments in structural programs coupled with either high levels of manufacturing involvement in strategic processes or planned investments in infrastructural programs correlate with higher than average performance.

Environmental and social sustainability priorities

“…Environmental and social sustainability performance are long term by definition, measuring resource preservation and regeneration (Brundtland Commission, 1987); operational performance is considered a proxy of long-term performance indicating the actual level of operational resources that will bring to future economical results (Stewart, 1991;Sveiby, 1997). Specifically, financial performance was measured in terms of ROI, ROS and market share, in accordance with studies such as Ward et al (1994), Vickery et al (1997), Papke-Shields and Malhotra (2001), Narasimhan and Jayaram (1998), Curkovic et al (2000) and Zhao et al (2006); Petkova and Dam, forthcoming). Each type of performance was measured in a comparison with each company's main competitors on Likert scales ranging from 1 for "much worse" to 5 for "much better".…”

A study of the effect of manufacturing proactivity on business performance

“…The term "manufacturing proactivity" ("manufacturing proactiveness" actually) was first used by Ward et al (1994). These authors distinguish between two dimensions of manufacturing proactivity:…”

“…Meredith and Vineyard (1993) also obtained certain evidence of the existence of a positive correlation, although they argued the relationship in a reverse sense. Ward et al (1994) observed that a higher involvement of the production function in strategic processes leads to better performance provided that long-term programmes of investments in structural and infrastructural capability have been also implemented.…”

Training and organizational effectiveness: moderating role of knowledge management process

“…For a company to cope with the rapid changing environment, it is necessary to invest in retraining, upgrading, updating and converting the skills of the existing workforce. Ward et al (1994) and Agnew et al (1997) have suggested that to promote organizational performance and industry competitiveness, workforce training and development is an important adjunct. Training needs are important to a company to maintain its employees' skills and competence to meet the future challenges as well as achieve a better performance.…”