Explaining manufacturing technology use, firm size and performance using a multidimensional view of technology

Abstract

This study examines the relationships among the variables Advanced Manufacturing Technology (AMT) use, Firm Size, and Performance in US manufacturing firms using a multidimensional definition of AMT. The study's four major findings are based on empirical analyses of survey data collected from 160 manufacturing firms. First, evidence indicates that there are at least four dimensions of AMT including: Information Exchange and Planning Technology (IEPT), Product Design Technology (PDT), High‐Volume Automation Technology (HVAT), and Low‐Volume Flexible Automation Technology (LVFAT). This brings to light a key difference between the literature and the four empirically determined dimensions of AMT: empirical dimensions include two distinct dimensions for shop floor technology while most conceptual schemes do not. Second, AMT use across three of these dimensions increases linearly as firm size increases logarithmically; however, the use of some dimensions of AMT increase more rapidly with firm size than others. Third, AMT use does not show any direct impact on firm performance. Finally, firm size weakly moderates the AMT‐performance relationship; perhaps, due to their superior resource base, larger firms are able to use AMTs more effectively.