Manufacturing Proactiveness and Performance

Abstract

At least since Skinner's [40] landmark article depicting the manufacturing function as the "missing link " in corporate strategic processes, a portion of the blame for inferior performance in many firms has been attributed to the subordinate strategic position of manufacturing. Further, it has been argued by many 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. In addition, this study shows 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. (Subject Area: Production/Operations Management and Manufacturing Strategy) 2