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A Strategic Perspective on Plants in Manufacturing Networks
Linköping University, Department of Management and Engineering, Production Economics. Linköping University, The Institute of Technology.
2011 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This dissertation addresses the topic of manufacturing network strategies, with a particular focus on the plant perspective. Research on manufacturing networks aims at contributing decision support on how to set up and how to coordinate factories that act in a global setting. Manufacturing networks are networks consisting of wholly owned plant, as opposed to supply chains management where also plants belonging to other organisations are considered. Research on the role of the plant in manufacturing networks can help to gain insights in how the network works and how to achieve network-related competitive advantages. Over the last two decades there has been a trend in increased globalisation and when companies expand beyond their home markets there is a leap in complexity that needs to be handled. A survey of Swedish plants shows that a large majority of medium and large sized plants are part in some kind of manufacturing network, making research on such networks highly relevant.

The overall objective of this dissertation is to investigate how factories fit into the network in terms of roles, strategic autonomy and market configurations. Much research has either focused on networks as a whole, often assuming similar or identical plants, or the focus has been on plant internal decision. This research addresses the borderland between plant and network. This dissertation addresses two research objectives. The first is to investigate the relationship between networks and plants roles with particular focus on Swedish based networks and plants and the second is to test and further develop the theory on plant roles.

The empirical data that was used in the dissertation was the product of a mail survey and a case study at a manufacturer of heat exchangers. The survey was sent to 563 Swedish factories and included information on competitive priorities, processes, plant roles, performance, suppliers, risk as well as general product and company information. Using focus groups, the case company was followed from the start of the project in January 2006. Following the case company during five years gave the opportunity to study networks in transformation.

The research contributed to several insights to the area of plant roles and manufacturing networks as well as to practitioners in manufacturing. Internal and external suppliers are handled differently in terms of selection criteria, which indicates different roles in the network. Detailed exploration of individual site competences has lead to an improved model based on competence themes and links between the plant level and the network level have been established. Additionally we contribute to the manufacturing strategy process area by investigating and suggesting a model for strategic decision autonomy in manufacturing networks. The results are aimed at providing guidance for decision making in manufacturing networks as well as providing an improved foundation for further research in the area.

Place, publisher, year, edition, pages
Linköping: Linköping University Electronic Press , 2011. , 34 p.
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1380
Keyword [en]
Empirical research, manufacturing networks, performance, plant roles, site competences, strategy
National Category
Engineering and Technology
Identifiers
URN: urn:nbn:se:liu:diva-68666ISBN: 978-91-7393-134-2OAI: oai:DiVA.org:liu-68666DiVA: diva2:419534
Public defence
2011-06-10, ACAS, Hus A, Campus Valla, Linköpings universitet, Linköping, 10:15 (English)
Opponent
Supervisors
Available from: 2011-05-27 Created: 2011-05-27 Last updated: 2011-05-27Bibliographically approved
List of papers
1. Designing and managing manufacturing networks: a survey of Swedish plants
Open this publication in new window or tab >>Designing and managing manufacturing networks: a survey of Swedish plants
2009 (English)In: Production planning & control (Print), ISSN 0953-7287, E-ISSN 1366-5871, Vol. 20, no 2, 101-112 p.Article in journal (Refereed) Published
Abstract [en]

The design and management of the manufacturing network for a firm is an important factor for its competitive position. By manufacturing network we mean the plant or plants of a manufacturing firm and the relationships with external suppliers. The way that these operate together is crucial for supporting the competition of the products in the marketplace. This article presents the results of a survey of 106 Swedish manufacturing plants. We find that the markets and supply networks of Swedish plants are global, but there is a focus on Europe. The main reason for locating a plant in Sweden is proximity to skills and knowledge, and we find no pure low-cost plants. The overall level of site competence is very high. There are many significant differences between how internal and external suppliers are selected. The choice of internal suppliers, i.e. those suppliers in the manufacturing network that belong to the same firm, is to a large extent based on a single corporate decision reflecting quality and competence, while external suppliers are chosen based on quality, price and delivery dependability considerations. This study provides a broad analysis of the manufacturing networks in which Swedish plants operate, and the roles of these plants.

Place, publisher, year, edition, pages
Taylor & Francis, 2009
Keyword
empirical analysis, operations management, supply chain management, survey research, Sweden
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-17137 (URN)10.1080/09537280802705252 (DOI)000263561600002 ()
Note

This is an electronic version of an article published in:Andreas Feldmann, Jan Olhager and Fredrik Persson, Designing and managing manufacturing networks-a survey of Swedish plants, 2009, PRODUCTION PLANNING and CONTROL, (20), 2, 101-112.PRODUCTION PLANNING and CONTROL is available online at informaworldTM: http://dx.doi.org/10.1080/09537280802705252Copyright: Taylor & Francishttp://www.tandf.co.uk/journals/default.asp

Available from: 2009-03-23 Created: 2009-03-07 Last updated: 2014-03-18Bibliographically approved
2. Internal and external suppliers in manufacturing networks: An empirical analysis
Open this publication in new window or tab >>Internal and external suppliers in manufacturing networks: An empirical analysis
2008 (English)In: Operations Management Research, ISSN 1936-9735, 1936-9743, Vol. 1, no 2, 141-149 p.Article in journal (Refereed) Published
Abstract [en]

The purpose of the paper is to explore the way manufacturing firms use internal and external suppliers in the design and management of manufacturing networks. The main area of interest is to explore the similarities and differences between internal and external suppliers, with respect to their roles and the reasons for choosing a certain type of supplier. We base our analysis on data from 104 Swedish manufacturing plants and their corresponding manufacturing networks of internal and external suppliers. The results of the study show that there are significant differences between the criteria that are influential in choosing a certain type of supplier. The choice of an internal supplier is largely based on a single corporate decision, while an external supplier has to perform well on a number of criteria (primarily quality, cost, and delivery dependability). When comparing the selection criteria with competitive priorities and plant performance, we find that the criteria for selecting external suppliers has a better match than those for selecting internal suppliers. The sample contained plants having only external suppliers as well as plants having both internal and external suppliers, but the selection criteria for external suppliers are the same for both groups and not dependent upon the presence or absence of internal suppliers.

Place, publisher, year, edition, pages
Springer, 2008
Keyword
Make-or-buy, Strategic sourcing, Supplier selection
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
urn:nbn:se:liu:diva-19437 (URN)10.1007/s12063-008-0011-1 (DOI)
Projects
PROFIL (Vinnova)
Available from: 2009-06-26 Created: 2009-06-23 Last updated: 2011-05-27Bibliographically approved
3. Bundles of site competences in defining plant roles
Open this publication in new window or tab >>Bundles of site competences in defining plant roles
(English)Manuscript (preprint) (Other academic)
Abstract [en]

Purpose: To investigate the strategic role of plants, in terms of the type and level of sitecompetence, the relationship with the strategic reason for location, and the impact onoperational performance.

Design/methodology: We use a survey of 103 Swedish manufacturing plants that belong to international manufacturing networks. We analyze patterns within this context to identify potential archetypes of plants with respect to plant roles, based on factor analysis and cluster analysis.

Findings: We find that the areas of site competence can be grouped into three bundles, characterized thematically as production-related, supply chain-related and developmentrelated. The plants fall into three categories: some plants have only production-related competences, some have competences concerning both production and supply chain, and the third group of plants possesses all three bundles of competences.

Research limitations/implications: The results provide empirical evidence that site competences come in bundles in three steps according to themes rather than individually. We find no significant relationship between the level of site competence and the strategic reason for site location.

Practical implications: The results provide insights into how site competence areas are bundled and combined for manufacturing plants, and indicate that higher levels of site competence lead to better performance in cost efficiency, quality, and new product introductions.

Originality/value: We research patterns of site competence at a more detailed level than before, as well as study the impact on performance. The results provide empirical evidence that site competences come in bundles in three steps according to themes rather than individually.

Keyword
Empirical research, Manufacturing network, Operations strategy
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-68663 (URN)
Available from: 2011-05-27 Created: 2011-05-27 Last updated: 2011-05-27Bibliographically approved
4. Linking networks and plant roles: The impact of changing a plant role
Open this publication in new window or tab >>Linking networks and plant roles: The impact of changing a plant role
2013 (English)In: International Journal of Production Research, ISSN 0020-7543, E-ISSN 1366-588X, Vol. 51, no 19, 5696-5710 p.Article in journal (Refereed) Published
Abstract [en]

Many manufacturing firms are expanding their global footprint to explore new opportunities for efficient and effective production. The strategic perspective on international manufacturing networks involves both the network level and the plant level. A key aspect is the relationship between the network and the role of plants. In this research, we investigate the relationship between the network and plant perspectives in international manufacturing networks. We use an embedded case study that includes five plants in two product networks over a period of three years. We analyse how changing the role of one plant affects the network as well as the roles of the other plants in the networks. We find that decisions on plant roles are, to a very high degree, network decisions and not decisions for individual plants. Based on the insights into the case study, we also develop a framework for mapping manufacturing networks, including market coverage, plant location and site competence.

Place, publisher, year, edition, pages
Taylor & Francis, 2013
Keyword
Case study, Global operations, International manufacturing, Longitudinal study, Manufacturing strategy
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-68668 (URN)10.1080/00207543.2013.778429 (DOI)000325069700003 ()
Available from: 2011-05-27 Created: 2011-05-27 Last updated: 2013-11-08Bibliographically approved
5. Distribution of Manufacturing Strategy Decision-Making in Manufacturing Networks
Open this publication in new window or tab >>Distribution of Manufacturing Strategy Decision-Making in Manufacturing Networks
(English)Manuscript (preprint) (Other academic)
Abstract [en]

This paper is concerned with manufacturing strategy decision-making. In particular, we study how strategic decisions are distributed between the network level and manufacturing plants in manufacturing networks. We use data from 107 manufacturing plants. This research shows that manufacturing strategy decisionmaking (in terms of decision categories and policy areas) can be divided into three difference types: centralized at the network level, decentralized at the plant level, and integrated between central headquarter and local plants. All decision categories follow the same structure, i.e. one of the three types is applied to all decision areas. Thus, we do not find support for that some decision areas are centralized while others are decentralized. The levels of site competences are significantly related to these decision-making patterns, such that plants with high levels of decision autonomy have significantly higher levels of site competences than plants with other decision-making structures.

Keyword
Decision categories, Exploratory study, Manufacturing strategy process, Survey research.
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-68664 (URN)
Available from: 2011-05-27 Created: 2011-05-27 Last updated: 2011-05-27Bibliographically approved
6. Testing a cumulative model of site competences
Open this publication in new window or tab >>Testing a cumulative model of site competences
(English)Manuscript (preprint) (Other academic)
Abstract [en]

This paper sets out to test the cumulative nature of site competences, also referred to as technical activities and their relationship to operational performance. Based on previeous identification of competence bundles, we specifically test the hypothesis that first production responsibilities are added at a plant then supply chain and finally  development responsibilities. We do this using structural equations modeling based on data from 109 Swedish plants. The results do not conclusively confirm a cumulative model, but give partial support for the hypothesis. There is also support for that higher degree of site competences can have a positive impact on certain aspects of operational performance.

Keyword
Plant role, cumulative competences, structural equations modeling
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-68665 (URN)
Available from: 2011-05-27 Created: 2011-05-27 Last updated: 2011-05-27Bibliographically approved

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