14th Cambridge International Manufacturing Symposium
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Configuring manufacturing value chains - Responding to an uncertain world
24 - 25 September 2009 at the Møller Centre, Cambridge
Research papers
Strategic choices and global chains from an operations-based perspective: a multiple cases study
Dr Ely Laureano Paiva and Dr Luciana Marques Vieira, UNISINOS Business School, Brazil
Global chains have a key role in a globally integrated economy. Studies in global chains usually have focused on the governance and strategies within the chain. This study seeks to analyze, from an operations-based approach, how operations strategy and strategic choices are developed in global value chains. It presents multiple case studies from the Brazilian footwear industry. Those companies have developed operations strategies that are not based on the traditional cost-based approach. The results suggest that this strategic choice requires a clear adaptation between companies' competitive priorities and operations decisions. Moreover, strategic changes imply the development of new operational capabilities and affect companies' value chain.
The appropriateness of current intervention policy patterns and delivery mechanisms to address the manufacturing SME needs in Europe
Professor Umit Bitici and Dr Aylin Ates, University of Strathclyde, UK
This research paper aims to report the first stage empirical research findings achieved in a comparative research, involving 13 end user SME partners (Small Medium-size Enterprise) and 13 R&D partners (academic institutions, consultancy, and SME support agencies) in seven European countries (i.e. Italy, UK, Turkey, Poland, Ireland and Czech Republic, Slovakia) as part of European Commission funded FP7 ‘FutureSME' programme. FutureSME is a collaborative platform to develop next generation systems, processes and tools to enable European manufacturing SMEs to compete and prosper globally. This paper addresses the appropriateness of the current intervention policy patterns at a national and regional level along with the delivery mechanisms used in the context of manufacturing SME needs. The findings are based on extensive research through constant consultation to partner SMEs and support agencies. The findings are validated through face-to-face meetings with 13 SMEs and SMAS (Scottish Manufacturing Advisory Service). The key message delivered is that a strategic rethink of the SME sector and changing the mindsets of SME managers are required to foster next generation competitive European SMEs through a more innovative intervention process being adopted. The required intervention process should deliver sustainable benefits to support SMEs rather than one-off programs.
The market value of supply chain flexibility: theory and evidence from the clean energy industry
Jane Davies and Nitin Joglekar, Boston University School of Management, USA
Competition has shifted increasingly from the individual firm to the supply chain level; as such, effective supply chain management is seen as a way of obtaining competitive advantage for all firms in the supply chain. In this paper we explore how decisions regarding flexibility, integration, assets and technology, which can lead to superior supply chain performance, are reflected in the stock market valuation of each firm and then calculate the supply chain effect on the value of these firms. We develop constructs to measure each decision and test hypotheses around the synergy between these constructs in the context of 42 supply chains drawn from the solar photovoltaic energy sector. The results indicate that in addition to firm level flexibility factors integration and assets are significantly associated with the valuation of the supply chain. We offer a method for capturing and correcting for this “supply chain effect” at the firm level.
Industrial shutdown in Finnish paper industry – case study from logistics provider perspective
Pekka Koskinen, Talentpartners Oy, Finland and Olli-Pekka Hilmola, Lappeenranta University of Technology, Finland
Paper production has been one of the key drivers of Finnish welfare for six decades of time. However, during the last two to three year time period several paper production units have been closed down. Reasoning has varied, but mostly it is combination of distance to main export harbours from the closed mill, high labour costs and high raw material costs. The main purpose of this article is to describe the financial and resource closing down effects on the logistics service providers and at the same to develop a financial and a resource adaptation model for estimating the closing down effects on the logistics service providers.
Based on case study on two closed down paper mills, which had an annual production capacity of 0.72 mill. tons, the financial consequences for the logistics service providers are significant and financially serious. The logistics service providers totally lost 37.3 Million eur of revenues (approx. 6 % from the sales of closed mills); also considerable amount of dedicated transportation capacity is left as unused, and high number of people were affected on logistics providers (actually more than 210, accounting for 27 % of total employment of two closed mills). All of the logistics service providers have started downsizing of their service production capacity. The revenue loss has also financial consequences. All of the logistics service providers, which were earlier involved in the analyzed supply chain, are making heavy losses.
Internationalising food supply chains: the impact of emerging market characteristics on supply networks
Harri Lorentz, Turku School of Economics, Finland, Pichawadee Kittipanya-ngam and Dr Jagjit Singh Srai, Institute for Manufacturing (IfM), University of Cambridge, UK
Foreign companies, entering emerging markets, need often to adapt their supply chains to the local market conditions. This paper develops market as a theoretical construct, from supply chain management point of view, and inquires: how do emerging market characteristics impact food supply chain network design? Based on a literature review, market is argued to consist of geographic, resource and institutional (GRI) characteristics, as well as primary/supporting members in the supply chain. A multiple case study on internationalising food manufacturers, with data from emerging markets in three continents, is presented to explore the supply network adjustments and their implications due to market characteristics. Our empirical findings emphasise the role of institutions, and especially, the role of primary/supporting members in the adjustment of the supply network structure. We conclude that typically, network design adjustments in emerging markets are aimed at managing the market context as well as food material and product characteristics to achieve target supply chain performance levels. A conceptual model is presented that links market GRI characteristics, product and material constraints with the achievement of target supply chain performance. From a practice perspective, the identification of configuration elements and approaches that support localisation strategies are presented.
Developing a refined model for purchasing and supply system transformation: benefiting from organizational change theories in purchasing development models
Leila Sadat Alinaghian and Dr Mohammad Aghdasi, Tarbiat Modares University and Kamran Razmdoost, Namvaran Consulting Engineering Company, Iran
The evolution of purchasing and supply system from a clerical task to a strategic value chain
makes it a means of creating competitive advantages for organizations. Generally, this
development happens slowly with no previous design and plan in organizations. Therefore, to
mitigate risks of this change and to increase its effectiveness, this development process should
be carefully structured and planned. In this paper, in order to achieve a purchasing and supply
system transformation model, purchasing development models are used as a basic framework.
By benefiting of organizational change concepts and theories, the reference model has been
designed as a tool to assess the current purchasing and supply system development situation
and the potential strategic growth path. Finally, relationships between purchasing content
change elements development have been identified as a departure point to develop the
purchasing transformation strategy. In the empirical research path, this exploratory research
has an inductive approach and the strategy by which the research is conducted is grounded
theory. Case studies are the chief tools for data collection and analysis.
Foreign aquisitions by Indian multinational enterprises: a test of the eclectic paradigm
Surender Munjal, Leeds University, UK
Since the turn of the century India has become the second fastest growing economy in the world. Indian multinational enterprises have increasingly been engaged into acquisitions of foreign firms, in particular in developed economies. While well accepted frameworks such as Dunning's eclectic paradigm were developed in the context of successful Anglo-American firms, there has been no attempt as yet to investigate their explanatory power in the context of mergers and acquisitions by emerging country multinationals. This paper analyses recent trends and patterns in India's outward investment abroad over the period 2000-2007 and identifies their determinants in the context of the eclectic paradigm and the investment development path.
Adoption of global operations strategy: A resource-based view perspective
Tritos Laosirihongthong and Atthawit Techawiboonwong, Thammasat University, Thailand
This study examined the extent to which lean supply chain management practices are adapted and adopted in manufacturing organizations and their impact on plant performance. Three factors, representing this global operations strategy, were extracted by using the exploratory factor analysis on 187 datasets from manufacturing firms in Thailand. These are (1) JIT, (2) waste minimization, and (3) flow management. The comparative analysis between small and medium enterprises (SMEs) and large enterprises (LEs) were investigated in the context of resources based view (RBV) theory. Finally, multiple regression models were developed to explain the effects of those three factors on plant performance. The results showed that JIT and waste minimization contribute significantly to plant performance of SMEs, whereas, only JIT contributes significantly to plant performance of LEs.
Complexity in global value networks - introduction of a promising model to determine complexity
Markus Gerschberger, Christian Söser, Professor Staberhofer Franz, LOGISTIKUM, Competence Centre for Logistics and Enterprise Networks, University of Applied Sciences, Austria
Increasing complexity can destroy company success. Vachon & Klassen (2002) provide evidence that complexity in companies, especially in global value networks, has significant influence on performance. Complexity management is currently and will continue to be a central success factor in companies and in global value networks (Deloitte, 2003) as companies are convinced from an increasing complexity over the next decade (Capgemini, 2008). The central aim of this paper is to describe a promising model to determine complexity in global value networks in order to continuously identify, evaluate and strategically select those relationships and those segments in the global value network that are relevant under the current dynamic market conditions.
FDI spillovers and the foreign entry speed: A study of Chinese manufacturing firms
Professor Peter J Buckley, Professor Jeremy Clegg and Yi (Elizabeth) Wang, University of Leeds, and Dr Chengqi Wang, Nottingham University Business School, UK
Using firm level data from Chinese locally-owned enterprises (LOEs) in manufacturing for the period 2000-2004, this study examines the relationship between the performance of individual LOEs and the entry speed of foreign-owned enterprises (FOEs) in the industry where the LOE operates. We find evidence of a negative impact from the foreign entry speed and such effect mainly occurs in industries where the foreign entry speed is moderate. The effect was moderated by the LOE's location and its technology gap with FOEs in the same industry. An LOE in eastern coastal China was more negatively affected than those in the inland. A small technology gap helped LOEs to eliminate partly the negative impact but such moderating effect was specific to LOEs that had a large technology gap and operated in the industry with a moderate foreign entry speed.
Visual management development with related technology assets: case study on chemical plant
K Murata and H Katayama, Waseda University, Japan and F Suzuki and Y Honda, Nippon Shokubai Company, Japan
A procedure of Visual Management (VM) development is discussed in this paper. Application of the procedure is performed through utilization of constructed VM Case-base, which consists of the following four phases: (1) identification of current burden, (2) selection of useful case from VM Case-base, (3) consideration of the other related cases to selected useful case and (4) new case design. Two case studies are performed to assure the relevance of the proposed procedure by focusing on VM of chemical plant. Then the proposed procedure is qualified by experts as useful method for Kaizen knowledge transfer through collaboration with a factory eager to implement VM.
The role of interdependence in offshoring
Dmitrij Slepniov & Brian Vejrum Waehrens, Aalborg University, Denmark
In the search for new sources of competitive advantage, companies are replacing a traditionally collocated in-house production with globally configured value networks, which consist of diverse and interdependent affiliates. The purpose of this paper is to investigate the role of interdependence in the process of global dispersion of work. The paper employs a qualitative methodology, which draws on a case study of a Danish company. The case company embarked on a large scale offshore outsourcing initiative in 2005. Since then, the company's operations set-up went through several major re-configurations. The study indicates that the company's offshoring patterns cannot be attributed exclusively to either management decisions or exogenous factors. Among other explanations, interdependence plays a significant role in determining the trajectories and outcomes of offshoring. On this basis, a number of recommendations for managers are developed.
Lean production through integration of management systems
Muhammad Asif, Erik J. de Bruijn and Olaf A. M. Fisscher, University of Twente, Netherlands and Mark Pagell, York University, Canada
Capability Development of Foreign Manufacturing Subsidiaries during Internationalisation: in the Case of the Machine Tool Industry
Kaoruko Yamazaki and Mike Gregory, Institute for Manufacturing, University of Cambridge
Strengthening SME's through rapid prototyping to meet future challenges. Why & how?
Ahmad Ayyaz, Hasan Maruf and Erik Jan Van Voorthuysen, The University of New South Wales, Australia
The Relationship Between Value Chain Design and Resilience: A Framework of Value Chain Design
Laird A. Burns and Steven A. Melnyk, Michigan State University, USA
This paper explores the theoretical and management issues surrounding value chain design by
focusing on the challenges of designing and implementing an efficient but resilient value
chain. To meet this challenge, a contingency-based framework is developed and evaluated
using data generated from an empirical study of two operating supply chains. At the heart of
this study and central to the focus on resilience is the assessment of how an integrated or
modular value chain design affects the ability of the supply chain to deal with the effects of
supply chain disruptions. The results reported indicate that the issue of integration does have
an impact on system performance – but not in ways expected. The paper concludes with a
discussion of the research and managerial implications of the study for supply chain design.
Redesigning Manufacturing Footprint from Dynamic Perspective: A Holistic Approach
Yang Cheng, John Johansen and Sami Farooq, Center for Industrial Production, Aalborg University, Denmark
An implementation of Leveling Production as an enabler of Global Value-driven Network redesign: a case study
Luciano Fonseca de Araujo, Federal University of Santa Catarina, Brazil
Continuous improvement in cellular manufacturing: Case analysis of an electronics manufacturer in Japan
Tomoaki Shimada, Kobe University, Japan
The Internationalisation of MNCs from Emerging Economies, especially from China
Rahul Thakar, Thapar University, India
Configuring Manufacturing Value Chains – responding to an uncertain world
E M Paveloski and J A Oliveira, Universidade Estadual Paulista, Bauru
A roadmap for the creation of new multinationals
Andre Leme Fleury and Afonso Fleury, University of Sao Paulo, Brazil
Understanding Project Networks: Contractor to Contractor Cooperation
Stephan Scheuner, Richard J. Harvey and Gerald Adlbrecht, University of Siegen, Germany
Configuration of Robust Value Added Networks
Gisela Lanza and Jörg Ude, Universität Karlsruhe, Germany
Challenges and consequences in the development process of the power: the ascent of China and the Latin American reality
Yslene Rocha Kacba and Kazuo Hatakeyama, Federal University of Technology of Parana, Brazil
Models of supply network formation in emergent industries
D. A. Kirkwood, Y. Shi and J. S. Srai, Institute for Manufacturing, University of Cambridge, UK
Tackle the changes in Mobile Handset Industry: outsourcing arrangements and the corresponding management methods
Ruiying Karen Li, Yongjiang Shi, Institute for Manufacturing, University of Cambridge, UK
Partnership Management for Commercialising Emerging Technologies
Yufeng Zhang and Yongjiang Shi
Core Competency Identification for High-tech Start-ups
Yufeng Zhang and Yongjiang Shi, Institute for Manufacturing, University of Cambridge, UK
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Thomas Harrington, Institute for Manufacturing, University of Cambridge, UK
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Thomas Harrington and Annie Iakovaki, Institute for Manufacturing, University of Cambridge, UK
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Gate Kittipanya-Ngam, Mike Gregory and Jagit Singh Srai, Institute for Manufacturing, University of Cambridge, UK
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Dakshata Rana and Mike Gregory, Institute for Manufacturing, University of Cambridge, UK
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