Journal of Operations Management 17 1999.

411428

Manufacturing technology and strategy formulation: keys to enhancing competitiveness and improving performance
Michael Tracey a , Mark A. Vonderembse
a

b, )

, Jeen-Su Lim

Purdue Uniersity, West Lafayette, Indiana 47907, USA b Uniersity of Toledo, Toledo, OH 43606-3390, USA Received 1 July 1997; accepted 23 July 1998

Abstract Porter wPorter, M.E., 1996. What is strategy? Harvard Business Review 74 6., 6178.x claims that a proper link between strategy and manufacturing operations is a key to developing sustainable competitive advantage. To be successful in this globally competitive, rapidly changing environment, organizations must formulate strategic plans that are consistent with their investment in and use of manufacturing technology. This study proposes that organizations that invest in advanced manufacturing technology and develop mechanisms for manufacturing managers to participate in strategy formulation will have improved competitive capabilities and better performance than firms that do not. Using the result from a large-sample survey, this study develops valid and reliable measures of advanced manufacturing technology and manufacturing managers participation in strategy formulation as well as the competitive capabilities of a firm. Linear structural equation analysis LISREL. results show that the relationships between a firms practices in these two areas and its competitive capabilities are found to be statistically significant and positive. Also, high levels of these competitive capabilities lead to high levels of performance as measured by customer satisfaction and marketing performance. q 1999 Elsevier Science B.V. All rights reserved.
Keywords: Empirical research; Operations strategy; Measurement and methodology; Technology management

1. Introduction Expanding global competition, rapidly changing markets and technology, and increasing complexity and uncertainty are creating a new competitive environment Manufacturing Studies Board, 1986; Bayus, 1994.. These changes are causing manufacturing firms to carefully examine a shift from industrial systems driven by efficiency and enabled by hard-automation to post-industrial systems where success
Corresponding author. Tel.: q1-419-530-4319; fax: q1-419530-8497; e-mail: mvonder@uoft02.utoledo.edu
)

depends on quick response to customer demands for customized, high quality products Skinner, 1969, 1986; Hayes et al., 1988; Doll and Vonderembse, 1991; Goldhar et al., 1991; McCutcheon et al., 1994; Roth, 1996.. In the post-industrial environment, high quality and reliability, timely delivery, enhanced customer service, rapid new product introduction, flexible systems, and efficient capital deployment, not cost reduction, are the primary sources of competitive advantage Skinner, 1986.. In the industrial era, firms focused on manufacturing a narrow range of products and sustaining efficient mass-production operations through productiv-

0272-6963r99r$ - see front matter q 1999 Elsevier Science B.V. All rights reserved. PII: S 0 2 7 2 - 6 9 6 3 9 8 . 0 0 0 4 5 - X

412

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

ity improvement programs Huber, 1984; Skinner, 1985.. The connection between manufacturing and corporate success was rarely more than achieving high efficiency and low costs Skinner, 1969.. In the post-industrial environment, successful strategies often hinge on an organizations ability to anticipate markets and to develop production systems that quickly design, produce, and deliver high-value products that meet specific customer needs Hall, 1992; Lado et al., 1992; Porter, 1992; Vonderembse et al., 1997.. Success depends on close and careful linkages between a firms manufacturing strategy and its overall strategy. These linkages help to guide decisions about how manufacturing technologies are applied, which competitive capabilities are achieved and, ultimately, how well firms perform Skinner, 1969; Porter, 1996.. The design of manufacturing systems should focus on developing competitive capabilities that satisfy customer needs and improve performance Ward et al., 1994.. As manufacturing systems evolve from industrial to post-industrial, these capabilities change, i.e, response time emerges as an important dimension of competition Blackburn, 1991.; the emphasis that customers place on capabilities change, i.e., product quality becomes more important than product cost Vonderembse et al., 1995.; and the ways organizations achieve these capabilities change, i.e., there is a transition from economies of scale to economies of scope Goldhar and Jelinek, 1983; Hayes and Pisano, 1994.. To cope with the changing environment, customer needs, and competitive factors, organizations should 1. develop policies and practices that enable manufacturing managers to participate in strategy formulation and 2. allow these linkages to guide their investments in and use of manufacturing technologies. Porter 1996. claims that a proper link between strategy and operations is a key to developing sustainable competitive advantage. Skinner 1969. states that manufacturing is the missing link in corporate strategy. Upton 1994. contends that firms must match their manufacturing systems capabilities with their strategic competitive priority in order to be successful. Ward et al. 1994. found that high performing firms have a stronger commitment to longterm investment in manufacturing capabilities than low performing firms. Case studies by Meredith and

McTavish 1992. describe the global marketing benefits that can be achieved from the strategic deployment of advanced manufacturing technology. Large-sample empirical studies that measure a firms level of advanced manufacturing technology, manufacturing managers participation in strategy formulation, competitive capabilities e.g., ability to offer a broad product line and dependable delivery., and overall firm performance are not available. As a result, we know little about whether or under what circumstance the levels of these two practices improve a firms competitive capabilities and performance Roth and Miller, 1992.. The purpose of this study is to investigate the research questions: do firms with a high level of advanced manufacturing technology and with a high level of manufacturing managers participation in strategy formulation have high levels of competitive capabilities and do firms with high levels of competitive capabilities have greater customer satisfaction and improved performance? To test these research questions, a large-sample, organizational-level study has been completed. Valid and reliable measures of advanced manufacturing technology, manufacturing managers participation in strategy formulation, and competitive capabilities are developed from these data. Scales developed by Swamidass and Newell 1987. and Ward et al. 1994. are starting points for developing the instrument to measure manufacturing managers participation in strategy formulation. An existing instrument is used to measure the firms level of performance Venkatraman and Ramanujan, 1986; McKee et al., 1989; Davis and Schul, 1993; Heskett et al., 1994; Narver and Slater, 1995.. Valid and reliable instruments are the foundation for research and are essential for testing structural relationships. LISREL is used to test the structural model that addresses these research questions. 2. Manufacturing technology and strategy In 1969, Wickham Skinner wrote, A companys manufacturing function typically is either a competitive weapon or a corporate millstone. It is seldom neutral. More recent writings promote the strategic importance of creating and maintaining an appropriate base of manufacturing assets to achieve the com-

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

413

petitive capabilities that insure long-term success Hofer and Schendel, 1978; Montanari, 1978; Hansen and Wernerfelt, 1989; Cohen and Levinthal, 1990; Collis, 1991; Barney, 1991; Carlsson, 1992; Hall, 1992; Boynton, 1993.. Research studies by Swamidass and Newell 1987. and Ward et al. 1994. provide further support for these claims. Swamidass and Newell 1987. surveyed 35 firms from the Pacific Northwest. They found that firms with high levels of manufacturing managers participation in strategic decision-making had higher performance as measured by growth in sales, return on total assets, and return on sales. Ward et al. 1994. examined 60 firms across five industries all operating in the state of Ohio. The study showed that firms with high levels of manufacturing managers involvement in strategy development, investment in specific manufacturing capabilities, and worker participation also had high performance as measured by market share and sales. In addition, longitudinal case studies by Meredith and Vineyard 1993. found that the lower the firms performance, the lesser the role of manufacturing managers in strategic decision making. This finding is similar to the other studies, but the causal direction is reversed. These regional, small-sample studies do not measure a firms competitive capabilities nor examine the impact of advanced manufacturing tech-

nology and manufacturing managers participation in strategy formulation on these capabilities. The proposed model, Fig. 1, illustrates that organizations which invest in Advanced Manufacturing Technology AMT. and have manufacturing managers who participate in strategy formulation MMP. will have enhanced Competitive Capabilities CC. and improved Levels of Performance LOP. Day, 1994.. This study defines these variables and describes the relationships shown in Fig. 1. It uses a nationwide, large-sample survey to develop appropriate measures for the variables and to test the hypotheses. 2.1. Adanced manufacturing technology AMT is the application of computer-enhanced, applied science to a firms production system. AMT is a resource that enables a firm to efficiently produce multiple products across the same asset base, thereby achieving economies of scope Goldhar and Jelinek, 1983.. Investments in AMT such as computer-aided design and computer numerical controls provide resources that enable a firm to respond to rapid market change and adapt to shorter product life cycles by designing and producing high-quality, custom designed products Doll and Vonderembse, 1987; Roth and Miller, 1992; Handfield and Pagell, 1995..

Fig. 1. Linking technology and strategy to create competitive capabilities and improve performance.

414

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

These resources enable the firms to develop an effective mix of platform and derivative products to meet specific customer requirements Wheelwright and Sasser, 1989; Wheelwright and Clark, 1992., and allows management to develop quick response strategies to compete in the global marketplace Meredith and McTavish, 1992.. These technologies encourage firms to implement cross-functional teams that reduce time and costs as well as improve quality in both product design and manufacturing. In delivery, AMT leads to higher order fill rates because the system can adjust rapidly to changing customer needs Slack, 1987.. Order cycle time is cut and more frequent deliveries can be made because the manufacturing system has shorter production runs. Computer-based manufacturing systems also create an environment that permits more accurate and timely shipment information Roth, 1996.. Hypothesis 1: A firms level of Advanced Manufacturing Technology AMT. has a positive effect on its Competitive Capabilities CC..

To successfully implement advanced technology, an organization must allow manufacturings evolving competencies to be a driving force in strategy formulation Harrison, 1990; Parthasarthy and Sethi, 1992; Ettlie and Penner-Hahn, 1994.. Porter 1996. describes the relationship between strategy and operational effectiveness as fundamental to competitive advantage and even more important to sustain that advantage. This involvement increases top management awareness of manufacturings important role in reaching organizational goals and encourages upperlevel support for technological innovations that span the organizations value chain. Manufacturing managers involvement in strategic decision-making can help to shape how an organization employs its manufacturing systems to gain competitive advantage. This results in the co-alignment of manufacturing system design and the organizations strategy. Hypothesis 2: A firms level of Manufacturing Managers Participation in Strategy Formulation MMP. has a positive effect on its Competitive Capabilities CC.. 2.3. Competitie capabilities

2.2. Manufacturing managers participation in strategy formulation MMP measures the extent to which manufacturing plant managers are involved in organizationallevel strategy development. Involving manufacturing managers in strategy formulation enables firms to develop organizational-level strategies that coordinate marketing, engineering, information systems, and other functional areas with manufacturing Upton, 1994; Porter, 1996.. This allows the organization to generate a steady stream of product and process innovations that improve a firms competitive capabilities and enhance the firms competitive position Skinner, 1969; Wheelwright and Clark, 1992; Wheelwright and Sasser, 1989; Vonderembse et al., 1997.. It also helps to create a shared learning environment that increases the rate of information exchange and provides opportunities to eliminate waste, reduce waiting time, and implement innovations Susman and Chase, 1986; Zuboff, 1988; Susman, 1990; Weick, 1990..

CC are the attributes of an organization that attract customers; they are potential points of differentiation between an organization and its competitors. They are not directly controllable by management but are outcomes of critical management decisions. Innis and LaLonde 1994. and Koufteros 1995. define a set of CC that describes an organizations capacity to satisfy customers including price offered, product quality, product line breadth, order fill rate, order cycle time, order and shipment information, and frequency of delivery. An organizations underlying cost structure must be low enough to offer a price that is comparable to the competition, or the products offered must be higher in value than the competition so a premium price can be commanded. Product quality and product line breadth variety. must meet or exceed customer expectations. The organization should have high order fill rates, short order cycle times, accurate order and shipping information, and frequent deliveries. These capabilities should enable firms to achieve high levels of customer satisfaction and market performance.

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

415

2.3.1. Price offered Price charged received the highest ranking among the 32 customer service attributes included in Innis and LaLondes 1994. study. A manufacturers ability to offer competitive prices andror command premium prices is influenced by the costs it incurs across the supply chain as well as the level of accompanying service it is able to offer Bresticker, 1992; Davis, 1993.. Price affects both profits and market share. The price and value trade-off is one of the key determinants of customer satisfaction Bergman, 1995.. 2.3.2. Quality of products Quality has become a key competitive issue in the global marketplace, both domestically and internationally Garvin, 1988; Flynn et al., 1994; Anderson et al., 1995.. Quality is defined as fitness for use and includes product performance, reliability, and durability. Quality is influenced by product design, manufacturing performance, incoming quality from suppliers, and delivery performance Novack et al., 1992.. Quality can affect the number of units sold, and it is a key element of value-to-customer. 2.3.3. Product line breadth Customers expect availability of various products and features that satisfy their individual requirements Meredith et al., 1994.. AMT enables the ongoing production of customized products at reasonable expense Goldhar and Jelinek, 1983; Ramamurthy and King, 1992.. Product line breadth influences both value and market share. The more precisely a product fits a customer need, the more value the customer will assign to it. As the product line breadth expands, more customers are able to find a product that meets their needs and sales should increase. 2.3.4. Order fill rate This is the percent of orders that are filled on-time Holcomb, 1994.. Providing a large number of product offerings and achieving a high order fill rate requires a manufacturing system that can react quickly to changing customer demand Davis and Gibson, 1993.. When orders are filled completely and correctly the first time, operating costs decline and customers are not dissatisfied.

2.3.5. Order cycle time The order cycle is defined by Lambert and Stock 1993. pp. 116. as the total elapsed time from the initiation of the order by the customer until delivery to the customer. Lowering cycle time is a primary issue in the current business environment for manufacturers of industrial and consumer products Stark, 1989; Goldhar and Lei, 1991; LaLonde and Powers, 1993; Holcomb, 1994.. Shortening the time it takes to bring a product from concept to production to market requires a manufacturing system that can respond quickly Bockerstette and Shell, 1993; McCutcheon et al., 1994.. Rapid response to orders reduces operating costs and enables customers to enjoy the products benefits immediately Stalk and Hout, 1990; Blackburn, 1991.. 2.3.6. Order r shipment information Innis and LaLonde 1994. found that customers want meaningful information when they place an order, e.g., product availability, projected shipping date, and projected delivery date. The ability to gather and transmit accurate data to customers is dependent on the level of real-time, computer-based, manufacturing flexibility present in the firm. 2.3.7. Frequency of deliery In the 1980s, customers began to recognize the actual cost of carrying inventory and started to push it back toward the manufacturer Coyle et al., 1992.. Today, customers as a matter of practice expect more frequent shipments and there is a strong tendency toward the reduction of incoming shipment sizes Vonderembse et al., 1995.. The capacity to fulfil this service request while incurring reasonable expense is highly dependent on the flexibility of the organizations manufacturing system. Hypothesis 3: A firms level of Competitive Capabilities CC. has a positive effect on its Level of Performance LOP..

2.4. Leel of performance LOP includes items that measure customer satisfaction and market performance. Customer satisfac-

416

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

tion is measured by the value customers perceive in the product, customer retention rates, and customer referrals. Market performance is measured by sales gains and market share growth Venkatraman and Ramanujan, 1986; McKee et al., 1989; Davis and Schul, 1993; Heskett et al., 1994; Narver and Slater, 1995.. The items used to measure LOP are listed in Appendix A. Five-point Likert scales are used for each question. Responses range from 1 s Unacceptable to 5 s Superior. The response X s Not RelevantrDo Not Know was made available.

3. Scale development: methods and pilot study results To develop valid and reliable scales to measure AMT, MMP, and CC, procedures suggested by Churchill 1979., Flynn et al. 1990., and Gerbing and Anderson 1984. were followed. An extensive literature review facilitated theory development and item generation, helped to define the domain of the constructs, and uncovered useful measures employed in previous studies. A pre-test was completed to enhance content validity. A pilot study was executed utilizing respondents similar to the target respondents. These steps were taken to insure content validity, reliability, and parsimony as well as construct and predictive validity of the instruments.

3.1. Item generation In developing measures of AMT, a decision was made to ask general questions about the use of real-time process controls and computer-based production technology rather than to ask questions about specific technologies such as robotics or flexible manufacturing systems. A list of specific technologies may miss some that are critical in one industry but not in another. Questions about specific technologies are sometimes misunderstood and often do not capture how effectively and extensively these technologies are used. Swamidass and Newell 1987. and Ward et al. 1994. describe items to measure MMP. Some of their items have been modified and

others have been eliminated to increase the likelihood of achieving unidimensionality in this construct. Items that measure CC are drawn from Cooper et al. 1992., Holcomb 1994., and Koufteros 1995.. Five-point Likert scales are used for all questions. Responses range from 1 s Strongly Disagree to 5 s Strongly Agree. The response X s Not RelevantrDo Not Know was also made available. The list of items and definitions for each construct was presented to six executives from six manufacturing firms. They were given several days to examine the model Fig. 1. as well as information regarding the types of executives who would be the target respondents. They were asked to review the questionnaire and to comment on the language and clarity of each question as well as the overall format of the instrument. They were encouraged to provide suggestions for additional items if they perceived that the items offered did not cover the intended domain of the variable, or to drop items they felt were redundant or inappropriate. Their input was gained through interactive, structured interviews and was helpful in improving the instrument with respect to its wording, clarity, and relevance. The resulting instrument was pre-tested. In the pre-test, inputs were received from two leading consultants in the area of manufacturing and eight academic experts in the disciplines of operations management, marketing, logistics, and industrial engineering. Each expert was mailed a copy of the instrument organized by construct with a definition for each dimension. They were asked to evaluate each item on the scale: keep, modify, or drop. They were also asked to suggest additional items if they felt that part of a construct was not adequately covered Gatewood and Field, 1994..

3.2. Pilot study A pilot study was conducted using respondents similar to the target respondents. The instrument was sent to 520 managers in manufacturing firms including: General ManagersrPresidents, OperationsrManufacturing Managers, FacilityrPlant Managers, and MaterialsrPurchasing Managers. Subjects were systematically selected from a mailing list pur-

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

417

chased from American Business Lists w , a division of Dunn and Bradstreet. Fifty usable responses were received from the pilot study mailing. The responses from the pilot study were used to explore the instrument with several objectives in mind: purification, reliability, parsimony, as well as construct and predictive validity. As described by Churchill 1979., the instruments were purified by examining the corrected-item total correlations CITC.. Items with CITC less than 0.5 were dropped. The item inter-correlation matrices provided by SPSS w were also used to drop items if they did not strongly contribute to Cronbachs alpha Cronbach, 1951. for the dimension under consideration Flynn et al., 1995.. Some items which did not contribute strongly to alpha, but whose content was considered important to the research, were designated for modification. Items related to a specific construct e.g., AMT. were also submitted as a group to exploratory factor analysis to assess their internalrconvergent validity. Maximum likelihood was chosen as the extraction procedure and the varimax method was utilized for factor rotation. Items which did not load at 0.60 or above were generally eliminated at this stage. Dillion

and Goldstein 1984. pp. 69., however, point out the researcher needs to consider an items importance to the research objective as well as its loading during factor interpretation. Accordingly, some items which had a weak factor loading were designated for modification during this initial phase of analysis. Cronbachs alpha 1951. was calculated for the retained items only to ensure that the items carried forward were internally consistent. In the next step, the externalrdiscriminant validity of each construct was appraised by submitting the items remaining for the entire construct e.g., CC. to exploratory factor analysis to uncover significant cross-loadings. The sample size of 50 observations was just large enough to justify factor analysis at the pilot study stage Hair et al., 1995: pp. 373., so the KaiserMeyerOlkin KMO. measure of sampling adequacy was calculated for each construct using SPSS w . This method helps to determine if it is appropriate to employ factor analysis Kaiser, 1970.. In each case, factor analysis was appropriate. Where significant cross-loadings were discovered, items were either dropped or modified. In some instances, an item or items were added to strengthen the measurement of a specific dimension.

Table 1 AMT and MMP Items, CITCs, and reliabilities after purification n s 474. Item Adanced manufacturing technology AMT1: We have incorporated real-time process control into our production systems AMT2: We utilize production technology that is among the most flexible in our industry AMT3: We apply computer-enhanced technology to improve the flexibility of manufacturing AMT4a : We reorganize our facilities as necessary to increase our manufacturing flexibility Manufacturing managers participation in strategy formulation MMP1: The input of manufacturing plant managers is an integral part of the strategy formation process MMP2: Manufacturing plant managers are involved in decisions related to strategies for company growth MMP3: Manufacturing plant managers have a good under-standing as to how companyrdivisional strategy is formed
a

CITC

Cronbachs a retained items

0.599 0.666 0.596 0.481

a s 0.7727

0.585 0.625 0.545

a s 0.7538

Item dropped.

418

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

The reliability of the remaining items comprising each dimension was examined using Cronbachs alpha 1951.. Finally, predictive validity was assessed by correlating composite measures of the constructs.

The instruments used in the large-sample survey for AMT and MMP are in Table 1 and the instruments for CC are in Table 2. Detailed results from the pilot study are available from the authors.

Table 2 Competitive capabilities CC. items, CITCs, and reliabilities after purification n s 474. Item Price offered PR1: We offer competitive prices PR2: We are able to compete based on our prices PR3: We are able to offer prices as low or lower than our competitors PR5a : We guarantee our prices PR4 a : We are able to sell our products at prices that are above average Quality of products QP2: We are able to compete based on quality QP3: We offer products that are highly reliable QP4: We offer products that are very durable QP5: We offer high quality products to our customers QP1a : We offer products that function according to customer needs Product line breadth PLB1: We respond well to changing customer preferences regarding products PLB2: We respond well to changing customer preferences regarding accompanying services PLB3: We alter our product offerings to meet client needs PLB4: We respond well to customer demand for "new" features PLB5a : We offer the products and services our customers want Order fill rate FR1: Our frequency of customer backorders is low FR2: Our customers are satisfied with our level of completeness for routine shipments FR3: We deliver the assortment of products ordered FR4 a : We deliver the desired quantities of products Order cycle time OCT3: Orders submitted to us are delivered on-time, as defined by the customer OCT4: We provide on-time delivery of customer orders OCT2 a : The time from our receipt of an order to possession of the shipment by that customer is acceptable to our clients OCT1a : We offer customers a reliable order processing time Order r shipment information OSI1: We supply accurate projected shipping dates OSI2: We supply accurate projected delivery dates OSI3 a : We supply clients with accurate information regarding product availability OSI4 a : We respond with accurate information to a customer inquiry concerning an order Frequency of deliery FD1: Our customers are pleased with the frequency of our delivery FD2: We can alter our delivery schedule per each customers requirements FD3: We are flexible in developing delivery schedules FD4: We work with each customer to develop a delivery schedule that is acceptable
a

CITC 0.532 0.585 0.458 0.273 y0.080

a : retained items a s 0.7899

0.641 0.761 0.695 0.772 0.578

a s 0.8588

0.730 0.665 0.660 0.676 0.561

a s 0.8425

0.577 0.666 0.575 0.430

a s 0.7456

0.832 0.825 0.753 0.637

a s 0.9192

0.801 0.784 0.655 0.631

a s 0.9057

0.587 0.584 0.614 0.631

a s 0.7916

Items dropped.

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

419

4. Scale development: large-sample methods and results The instruments developed in the pilot study along with items measuring LOP were mailed to 3333 executives on the American Business Lists w . These executives represent 3333 different organizations from four SIC codes: a25Furniture and Fixtures; a34Fabricated Metal Products; a35Industrial and Commercial Machinery; and a36,Electronic and Other Electrical Equipment. The organizations have from 50 to 1000 employees. These SIC codes were selected because they contain many discrete part manufacturers. A cover letter, signed by the Executive Vice President of the National Association of Purchasing Management, was included to encourage participation. A follow up letter and questionnaire was sent to those who do not return the initial questionnaire after a five week waiting period. Fourteen packets were returned as undeliverable. Of the responses received, 58 were appraised as being unsuitable for the large-scale analysis. Most of the rejected questionnaires were due to a lack of manufacturing at the respondents location, or to an insufficiently completed survey. A total of 474 responses were appraised as suitable for the large-scale analysis giving an effective response rate of 14.5% w474 % 3333 y 14 y 58.x. Nearly all of the respondents were manufacturing managers at the director level or above. Approximately, 75% of the firms had 500 or fewer employees at the respondents location, and the types of manufacturing operations were approximately uniformly distributed across the spectrum from continuous flow to job shop.

The 474 acceptable responses from the large-scale survey were used to further refine the instrument using the same criteria as in the pilot test. The methods were the same as those used in the pilot test except that single dimension factor analysis was not done. 4.1. Scale deelopment: adanced manufacturing technology (AMT) and manufacturing managers participation in strategy formulation (MMP) Table 1 displays the results of purification using the CITCs and Cronbachs alpha 1951. for AMT and MMP. One item was dropped from the AMT because the CITC for item AMT4 was less than 0.5. All three items for MMP were retained. Table 3 displays the results of submitting the six remaining items to factor analysis to determine if the instruments have construct validity. The KMO measure of 0.77 indicates that factor analysis was appropriate. MMP3 was retained even though its loading was slightly below 0.60 because it was judged to be important to the research. Loadings below 0.40 are not reported. 4.2. Scale deelopment: competitie capabilities (CC) Table 2 displays the results of purification using the CITCs and Cronbachs alpha 1951. for the CC factors. Two items were dropped from the Price Offered PR. dimension and one item was dropped from the Order Fill Rate FR. because their CITCs were less than 0.5. One item was dropped from Quality of Products QP. and another from Product

Table 3 AMT and MMPfactors, loadings, and reliabilities after factor analysis n s 474. KaiserMeyerOlkin measure of sampling adequacy s 0.77 Item Advanced manufacturing technology factor 1st. 0.7611 0.6761 0.6497 0.7847 0.6822 0.5888 1.52 Manufacturing managers participation in strategy formulation factor 2nd.

a for retained items

APT2 APT1 APT3 MMP2 MMP1 MMP3 Eigen values

a s 0.7727

a s 0.7538

1.56

420

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

Line Breadth PLB. because they did not strongly contribute to Cronbachs alpha 1951. in their respective construct and there were four other items in those constructs. Two items were dropped from both Order Cycle Time OCT. and OrderrShipment Information OSI. dimensions because Cronbachs alpha 1951. increased substantially for each factor. The four Frequency of Delivery FD. dimension items were retained for factor analysis. Table 4 displays the results of submitting the 22 items remaining to factor analysis to assess the construct validity for CC. Loadings below 0.40 are not reported. The KMO measure of 0.93 indicates that factor analysis was appropriate. Four factors were retained and placed on the suggested final instrument. Price Offered PR., Quality of Products QP., and Product Line Breadth PLB. emerged as distinct factors ranking fourth, second, and third, respectively, in variance explained. During the pilot study analysis, the items for Order Fill Rate FR., Order

Cycle Time OCT., and Frequency of Delivery FD. loaded on a single factor. In the factor analysis for the large-sample data set, items from these factors as well as OrderrShipment Information OSI. once again loaded together. This larger dimension was labeled the Delivery Capability DC. factor. It explained the largest amount of variance for the CC construct. There is support in the literature for re-conceptualizing these four dimensions as a single factor. Goldhar et al. 1991., Hall 1992., Lado et al. 1992., and Porter 1992. contend that customer satisfaction is contingent on an efficient, flexible delivery system. The managers surveyed perceive order fill rates, order cycle times, order and shipment information, and frequency of delivery as facets of a single competitive capability, i.e., DC. Two of the DC items measure customer satisfaction FR2. or customer pleasure FD1. rather than capabilities. This is a minor problem. In future stud-

Table 4 Competitive capabilities CC. factors, loadings, and reliabilities after factor analysis n s 474. KaiserMeyerOlkin measure of sampling adequacy s 0.93 Item PR2 PR1 PR3 QP4 QP3 QP5 QP2 PLB1 PLB2 PLB4 PLB3 OSI2 OCT3 OSI1 OCT4 FD1 FR2 FR1 FD4 FD3 a FR3 a FD2 a Eigen values
a

Price offered factor 4th. 0.8288 0.7054 0.6436

Quality of products factor 2nd.

Product line breadth factor 3rd.

Delivery capability factor 1st.

a for retained items

a s 0.7899
0.8215 0.7934 0.7141 0.6233 0.7760 0.6708 0.6651 0.6543 0.8559 0.8549 0.8299 0.8194 0.7272 0.6789 0.6654 0.6536 0.5291 0.5197 0.5036 4.95

a s 0.8588

a s 0.8425

a s 0.9292

1.75

2.48

2.27

Items dropped.

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

421

ies, it may be appropriate to reword these items to reflect capabilities rather than customer satisfaction. 4.3. Leel of performance (LOP) The instrument used to measure LOP are listed in Appendix A along with a final list of items for all the constructs. The six LOP items loaded on a single factor, had factor loadings of 0.635 or higher, and had a reliability of 0.89. 4.4. Predictie alidity Composite measures of the AMT and MMP as well as CC, and LOP constructs were then submitted to SPSS w to determine the Pearson product-moment correlation coefficients r .. The correlation coefficient for the combination of AMT and MMP with CC is 0.51, and it is 0.48 for CC with LOP. These coefficients are significant at a s 0.01. This indicates that the constructs are statistically related which validates the possibility of causal relationships. 4.5. Generalizability across industries To demonstrate the generalizability of these scales, Cronbachs alpha 1951. was calculated for the in-

dustries with a sufficient number of responses: fabricated metal 184 responses., electronics 111., and machinery 61.. For all instruments, AMT, MMP, CC, and LOP, there is no significant difference in reliability across these industries.

5. Large-sample results: LISREL analysis and structural modeling Fig. 2 is a restatement of the model shown in Fig. 1 which displays the relationships to be tested with structural equation modeling. In structural equation modeling, it is preferable to have several indicators of a construct as opposed to a single indicator Hair et al., 1995.. The items retained from scale development are utilized as the observable indicators of the exogenous latent variables, AMT and MMP. The composite scores for the Price Offered PR., Quality of Products QP., Product Line Breadth PLB., and Delivery Capability DC. factors are shown as the observable indicators of the endogenous latent variable, CC. The composite measures were calculated by summing the individual scores for each item in a dimension and then dividing by the number of items. For example, the responses to PR1, PR2, and PR3 were summed and then divided by three to determine

Fig. 2. The impact of technology and strategy on competitive capabilities and performance.

422

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428 Table 5 Summary of LISREL generated results Figs. 2 and 3. Relationship t-value Significant LISREL coefficient 0.423 0.342 0.803

the composite measure PR. The responses to the six items listed in Appendix A were used as the observable indicators of the endogenous latent variable, LOP. LISREL is a vigorous method for testing causal models with both observable and latent variables as it is capable of simultaneously evaluating the measurement and causal components of complex models. LISREL consequently is becoming preferred to correlation, regression, or path analysis by researchers for testing causal models Dillion and Goldstein, 1984.. The goodness-of-fit index GFI. is used to evaluate the appropriateness of the models tested. It is relatively robust against departures from normality and appraises all of the models parametersincluding measurement items, directional relationships, and error termsat the same time. GFI provides a measure ranging from 0 to 1. GFI will be close to 1 if a good model to data fit is detected Dillion and Goldstein, 1984.. The statistical distribution of the GFI measure is unknown, so there is no absolute standard with which to compare them Joreskog and Sorbom, 1989.. All of the 474 responses were submitted to LISREL to evaluate the model in Fig. 2. The GFI of 0.951 indicates a good model to data fit. The goodness-of-fit index adjusted for degrees of freedom AGFI. was 0.929, which is also good. The computed t-values, which evaluate the statistical significance of the indicators measurement portion of LISREL., ranged from 7.951 to 15.196. These are well above the minimum acceptable t-value of 2.00 at a s 0.05.. The top portion of Table 5 displays a summary of the data related to testing the hypothesized relationships shown in Fig. 2. The computed t-values judge the statistical significance of each theorized relationship, and they are well above the minimum acceptable value of 2.00. LISREL coefficients give an indication of the relative strength of each relationship at a s 0.05.. Hypotheses 1 and 2 are both supported because a significant positive relationship is shown between AMT and CC and between MMP and CC. Firms that invest heavily in computer-enhanced, real-time process technology achieve higher levels of competitive capabilities than firms with lower levels of invest-

Test of hypotheses 1, 2, and 3 Fig. 2. AMT CC 5.309 Yes MMP CC 4.382 Yes CC LOP 7.262 Yes

Impact of AMT and MMP on the dimensions of CC Fig. 3. AMT PR 4.158 Yes 0.331 AMT QP 1.636 No 0.120 AMT PLB 3.843 Yes 0.288 AMT DC 6.618 Yes 0.529 MMP PR 0.611 No 0.047 MMP QP 4.570 Yes 0.362 MMP PLB 3.141 Yes 0.236 MMP DC 0.249 No 0.017

ment. Firms that involve manufacturing facility managers in the strategy formulation process also achieve higher levels of competitive capabilities than firms with lower levels of involvement. Because these relationships were tested simultaneously using LISREL both impacts are significant. Hypothesis 3 is also supported because a positive relationship is demonstrated between CC and LOP. Firms with high levels of competitive capabilities specifically the ability to control pricing, achieve high product quality, offer product line breadth, and have dependable delivery,are high performing as measured by customer satisfaction and market performance. Taken in conjunction with the acceptance of Hypotheses 1 and 2, it may be appropriate to claim that AMT and MMP positively affect organizational performance through their impact on competitive capabilities.

6. Implications for management: improving competitive capabilities While it is certainly useful to understand that AMT and MMP may have a positive impact on a firms competitiveness and performance, it seems important to know which factors of CC are impacted by AMT and MMP. To examine these relationships at the factor level, the model in Fig. 3 was submitted to LISREL. The entire group of 474 suitable re-

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

423

Fig. 3. Examining relationships between both AMT and MMP and the dimensions of competitive capabilities.

sponses were again utilized. The scales developed for AMT and MMP were again utilized as the observable indicators of the exogenous latent variables. The scales developed for Price Offered PR., Quality of Products QP., Product Line Breadth PLB., and Delivery Capability DC. are employed as indicators of the individual dimensions of CC. The GFI of 0.935 indicates a clearly acceptable model to data fit. The AGFI is 0.915, which is also good. The computed t-values for the indicators measurement portion of LISREL. ranged from 7.948 to 17.437. The bottom portion of Table 5 displays a summary of the data generated by LISREL related to

the testing of the hypothesized relationships between the constructs. The impact of AMT on PR, PLB, and DC are significant with t-values at 3.843 or higher. Investing in computer-enhanced, real-time manufacturing technology appears to give organizations better cost management capabilities so they can become price setters and provide greater flexibility so they can deliver a wider variety of products and deliver them quickly, accurately, and on-time. The impact of AMT on QP is not statistically significant at a s 0.05. This may be attributable to the fact that quality is more a function of management practices, processes,

424

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

and procedures than equipment capabilities. In other words, good management practices including a strong organizational-level focus on quality may enable firms to achieve high quality even if their equipment has low levels of automation and is inflexible. This discussion should not preclude organizations from investing in new facilities and equipment where new process technology is essential for high product quality or new equipment is needed to hold tighter tolerances. The impact of MMP on QP and on PRB are both significant with t-values of 4.570 and 3.141, respectively. Involving manufacturing plant managers in strategy formulation may bring quality issues to the forefront so that managers from all functions recognize the importance of achieving quality objectives. Quality as defined externally by the customer is multi-faceted; it is not the sole responsibility of manufacturing. To achieve this externally defined goal, a coordinated, cross-functional effort is required. To achieve product line breadth, it is essential to involve manufacturing managers in strategy formulation because product line breadth can only be attained through the coordinated efforts of marketing, engineering, manufacturing, and suppliers.

7. Discussion and conclusion The primary purpose of this study is to investigate the research questions: do firms with a high level of advanced manufacturing technology and with a high level of manufacturing managers participation in strategy formulation have high levels of competitive capabilities and do firms with high levels of competitive capabilities have greater customer satisfaction and improved performance. In the process of addressing these questions, valid and reliable instruments were developed to measure AMT, MMP, and CC. Four factors emerged as representative of a firms CC: price offered, quality of products, product line breadth, and delivery capabilities. The research design included a rigorous literature review and structured interviews with practitioners and academic experts. Great care was taken during item generation, pre-testing, and pilot testing to ensure content validity. The instruments are unidimensional with strong evidence of convergent, discriminant, and predictive

validity. The instruments have high reliability for all industries in the sample which lends support to the claim that the instruments are generalizable across industries. Analysis of a large-sample, organizational-level survey of manufacturing firms from across the US was used to develop the instruments and examine the research questions. The results of structural equation model testing clearly indicate that there is a positive relationship between advanced manufacturing technologies and competitive capabilities and between manufacturing managers participation in strategy formulation and competitive capabilities. The study also confirmed the notion that firms with high levels of competitive capabilities achieve high levels of performance as measured by customer satisfaction and market performance. This is the first large-scale study to investigate these research questions. It provides support for the claims of Skinner 1969. and others that manufacturing should be an integral part of corporate strategy formulation and that investments in advanced manufacturing technology should be guided by organizational-level strategy. Linking strategy and technology may be a critical determinant of organizational performance. When the impacts of AMT and MMP are examined on the four factors of CC, five of the eight relationships are significant. AMT has its largest impact on Delivery Capabilities DC., and it also has a significant impact on Price Offered PR. and Product Line Breadth PLB.. Both DC and PLB are enhanced by the creation of manufacturing systems that can produce a wide variety of products. This finding could indicate that the computer-based automation and real-time process control achieved by AMT may enhance manufacturing flexibility. In addition, MMP has a significant impact on PLB. So, manufacturing managers who successfully install advanced manufacturing technologies and participate in high-level strategy formulation may increase product flexibility. This finding is in contrast to early critics of advanced manufacturing technology Jaikumar, 1986. who maintained that manufacturing managers in the US applied this technology with a mass production mindset and achieved only lower labor costs. It would appear that an improving understanding of the technology and increasing involvement in strat-

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428

425

egy formulation have helped manufacturing managers to implement this technology successfully. Future research should include a second independent large-scale survey and employ confirmatory methods to verify and fine-tune the scales. It should evaluate the items for trait and method variance using LISREL and test hypotheses with alternative measurements scales and a between subject design. Flexibility is an essential component of research. A clear definition of manufacturing flexibility as well as valid and reliable scales would be important contributions. With good measures of flexibility, studies of its impact on competitive capabilities and organizational performance could be completed. Roth 1996., Weick 1990., and others maintain utilizing advanced manufacturing technology to its full potential entails allowing the operators full involvement in managing the system. What is the role of a participative management style in the design, implementation, and execution of advanced manufacturing technology? Does the benefits of manufacturing managers participation in strategy development extend to the participation of shop floor employees in planning and executing continuous improvement on the shop floor?

A.2. Manufacturing managers participation in strategy formulation (MMP) -The input of manufacturing plant managers is an integral part of the strategy formation process MMP1.. -Manufacturing plant managers are involved in decisions related to strategies for company growth MMP2.. -Manufacturing plant managers have a good understanding as to how companyrdivisional strategy is formed MMP3.. A.3. Competitie capabilities A.3.1. Price offered (PR) -We offer competitive prices PR1.. -We are able to compete based on our prices PR2.. -We are able to offer prices as low or lower than our competitors PR3.. A.3.2. Quality of products (QP) -We are able to compete based on quality QP2.. -We offer products that are highly reliable QP3.. -We offer products that are very durable QP4.. -We offer high quality products to our customers QP5.. A.3.3. Product line breadth (PLB) -We respond well to changing customer preferences regarding products PLB1.. -We respond well to changing customer preferences regarding accompanying services PLB2.. -We alter our product offerings to meet client needs PLB3.. -We respond well to customer demand for new features PLB4.. A.3.4. Deliery capability (DC) -Our frequency of customer backorders is low FR1.. -Our customers are satisfied with our level of completeness for routine shipments FR2.. -Orders submitted to us are delivered on-time, as defined by the customer OCT3.. -We provide on-time delivery of customer orders OCT4..

Acknowledgements The authors wish to thank the Information Systems and Operations Management Departments Academic Challenge Grant Committee at The University of Toledo for its generous support of this research.

Appendix A. Final List of Items for AMT, MMP, CC, and LOP A.1. Automated manufacturing technology (AMT) -We have incorporated real-time process control into our production systems AMT1.. -We utilize production technology that is among the most flexible in our industry AMT2.. -We apply computer-enhanced technology to improve the flexibility of manufacturing AMT3..

426

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428 Cooper, M.C., Innis, D.E., Dickson, P.R., 1992. Strategic Planning For Logistics. Council of Logistics Management, Oak Brook, IL. Coyle, J.J., Bardi, E.J., Langley, C.J., 1992. The Management of Business Logistics, 5th edn. West Publishing, St. Paul, MN. Cronbach, L.J., 1951. Coefficient alpha and the internal structure of tests. Psychometrika 16, 297334. Davis, D., Gibson, B., 1993. Responsiveness: redefining logistics management for the 1990s and beyond. Proceedings of the Twenty Second Annual Transportation and Logistics Educators Conference. The Ohio State University, Columbus, OH, pp. 119. Davis, P.S., Schul, P.L., 1993. Addressing the contingent effects of business unit strategic orientation on relationships between organizational context and business unit performance. Journal of Business Research 27 3., 183200. Davis, T., 1993. Effective supply chain management. Sloan Management Review, Summer, 3546. Day, G.S., 1994. The capabilities of market-driven organizations. Journal of Marketing 58 10., 3752. Dillion, W.R., Goldstein, M., 1984. Multivariate Analysis: Methods and Applications. Wiley, New York. Doll, W.J., Vonderembse, M.A., 1987. Forging a partnership to achieve competitive advantage: the CIM challenges. MIS Quarterly 11, 205220. Doll, W.J., Vonderembse, M.A., 1991. The evolution of manufacturing systems: towards the post-industrial enterprise. Omega 19 5., 401411. Ettlie, J.E., Penner-Hahn, J.D., 1994. Flexibility ratios and manufacturing strategy. Management Science 40 11., 14441454. Flynn, B.B., Sakakibara, S., Schroeder, R.G., Bates, K.A., Flynn, E.J., 1990. Empirical research methods in operations management. Journal of Operations Management 9 2., 250284. Flynn, B.B., Schroeder, R.G., Sakakibara, S., 1994. A framework for quality management research and an associated measurement instrument. Journal of Operations Management 11 4., 339366. Flynn, B.B., Schroeder, R.G., Sakakibara, S., 1995. The impact of quality management practices on performance and competitive advantage. Decision Sciences 26 5., 659691. Garvin, D.A., 1988. Managing Quality. The Free Press, New York. Gatewood, R.D., Field, H.S., 1994. Employee Selection. Dryden Press, Fort Worth. Gerbing, D.W., Anderson, J.C., 1984. On the meaning of withinfactor correlated measurement errors. Journal of Consumer Research 11 1., 572580. Goldhar, J.D., Jelinek, M., 1983. Plan for economies of scope. Harvard Business Review 61 6., 141148. Goldhar, J.D., Jelinek, M., Schlie, T.W., 1991. Competitive advantage in manufacturing through information technology. International Journal of Technology Management, Special Publication on the Role of Technology in Corporate Policy, 162180. Goldhar, J.D., Lei, D., 1991. The shape of twenty-first century global manufacturing. The Journal of Business Strategy 12 2., 3741.

-We supply accurate projected shipping dates OSI1.. -We supply accurate projected delivery dates OSI2.. -Our customers are pleased with the frequency of our delivery FD1.. -We work with each customer to develop a delivery schedule that is acceptable FD4.. A.4. Leel of performance (LOP) -Customers perceiving they receive their moneys worth when they purchase our products. -Customer retention rate. -Generating new business through customer referrals. -Sales growth position. -Market share gain. -Overall competitive position.

References
Anderson, J.C., Rungtusanatham, M., Schroeder, R.G., Devaraj, S., 1995. A path analytic model of a theory of quality management underlying the Deming management method: preliminary empirical findings. Decision Sciences 26 5., 637658. Barney, J.B., 1991. Firm resources and sustained competitive advantage. Journal of Management 17 1., 99120. Bayus, B.L., 1994. Are product life cycles really getting shorter? Journal of Product Innovation Management 11, 300308. Bergman, R.L., 1995. Integrating marketing, operations, and purchasing to create value. Omega 23 2., 159172. Blackburn, J., 1991. Time-Based Competition. Business One Irwin, Homewood, IL. Bockerstette, J.A., Shell, R.L., 1993. Time-Based Manufacturing, McGraw-Hill, New York. Boynton, A.C., 1993. Achieving dynamic stability through information technology. California Management Review 35 2., 5877. Bresticker, R.B., 1992. American Manufacturing and Logistics in the Year 2001. Brigadoon Bay Books, Hoffman Estates, IL. Carlsson, B., 1992. Management of flexible manufacturing: an international comparison. Omega 20 1., 1122. Churchill, G.A., 1979. A paradigm for developing better measures of marketing constructs. Journal of Marketing Research 16, 6473. Cohen, W.M., Levinthal, D.A., 1990. Absorptive capacity: a new perspective on learning and innovation. Administrative Science Quarterly 35, 128152. Collis, D.J., 1991. A resource-based analysis of global competition: the case of the bearings industry. Strategic Management Journal 12, 4968.

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428 Hair, J.F., Anderson, R.E., Tatham, R.L., Black, W.C., 1995. Multivariate Data Analysis, 4th edn. Prentice Hall, Englewood Cliffs, NJ. Hall, R., 1992. The strategic analysis of intangible resources. Strategic Management Journal 13, 135144. Handfield, R.B., Pagell, M.D., 1995. An analysis of the diffusion of flexible manufacturing systems. International Journal of Production Economics 39 3., 243253. Hansen, G.S., Wernerfelt, B., 1989. Determinants of firm performance: the relative importance of economic and organizational factors. Strategic Management Journal 10, 399411. Harrison, M., 1990. Advanced Manufacturing Technology Management. Pitman Publishing, London. Hayes, R.H., Wheelwright, S.C., Clark, K.B., 1988. Dynamic Manufacturing. The Free Press, New York. Hayes, R.H., Pisano, G.P., 1994. Beyond world-class: the new manufacturing strategy. Harvard Business Review 72 1., 77 86. Heskett, J.L., Jones, T.O., Loveman, G.W., Sasser, W.E., Schlesinger, L.A., 1994. Putting the service-profit chain to work. Harvard Business Review 72 2., 164174. Hofer, C.W., Schendel, D., 1978. Strategy Formulation: Analytical Concepts. West, St. Paul, MN. Holcomb, M.C., 1994. Customer service measurement: a methodology for increasing customer value through utilization of the taguchi strategy. Journal of Business Logistics 15 1., 2952. Huber, G.P., 1984. The nature and design of post-industrial organizations. Management Science 30 8., 928951. Innis, D.E., LaLonde, B.J., 1994. Customer service: the key to customer satisfaction, customer loyalty, and market share. Journal of Business Logistics 15 1., 128. Jaikumar, R., 1986. Postindustrial manufacturing. Harvard Business Review 64 6., 6976. Joreskog, K.G., Sorbom, D., 1989. LISRELw 7, Users Reference Guide. Scientific Software. Kaiser, H.F., 1970. A second-generation little jiffy. Psychometrika 35, 401415. Koufteros, X.A., 1995. Time-Based Competition: Developing a Nomological Network of Constructs and Instrument Development. The University of Toledo, Toledo, OH. Lado, A.A., Boyd, N.G., Wright, P., 1992. A competency-based model of sustainable competitive advantage: toward a conceptual integration. Journal of Management 18 1., 7791. LaLonde, B.J., Powers, R.F., 1993. Disintegration and re-integration: logistics of the twenty-first century. International Journal of Logistics Management 4 2., 112. Lambert, D.M., Stock, J.R., 1993. Strategic Logistics Management, 3rd edn. Irwin, Homewood, IL. Manufacturing Studies Board, 1986. Toward a New Era in U.S. Manufacturing. National Academy Press, Washington, DC. McCutcheon, D.M., Raturi, A.S., Meredith, J.R., 1994. The customization-responsiveness squeeze. Sloan Management Review 35 2., 8999. McKee, D.O., Varadarajan, P.R., Pride, W.M., 1989. Strategic adoptability and firm performance: a market-contingent perspective. Journal of Marketing 53 6., 2135. Meredith, J.R., McCutcheon, D.M., Hartley, J., 1994. Enhancing

427

competitiveness through the new market equation. International Journal of Operations and Production Management 14 11., 722. Meredith, J.R., McTavish, R., 1992. Organized manufacturing for superior market performance. Long Range Planning 25 6., 6371. Meredith, J.R., Vineyard, M., 1993. A longitudinal study of the role of manufacturing technology in business strategy. International Journal of Operations and Production Management 13 12., 424. Montanari, J.R., 1978. Managerial discretion: an expanded model of organization choice. Academy of Management Review, April, 231241. Narver, J.C., Slater, S.F., 1995. Market orientation and the learning organization. Journal of Marketing 59 3., 6374. Novack, R.A., Grenoble, W.L., Goodbread, N.J., 1992. Teaching quality in logistics. Proceedings of the Twenty Second Annual Transportation and Logistics Educators Conference. The Ohio State University, Columbus, OH, pp. 4885. Parthasarthy, R., Sethi, S.P., 1992. The impact of flexible automation on business strategy and organizational structure. Academy of Management Review 17 1., 86111. Porter, M.E., 1992. Capital disadvantage: Americas failing capital investment system. Harvard Business Review 70 5., 6582. Porter, M.E., 1996. What is strategy? Harvard Business Review 74 6., 6178. Ramamurthy, K., King, W.R., 1992. Computer integrated manufacturing: an exploratory study of key organizational barriers. Omega 20 4., 475491. Roth, A.V., 1996. Achieving strategic agility through economics of knowledge. Strategy and Leadership 24 2., 3037. Roth, A.V., Miller, J.G., 1992. Success factors in manufacturing. Business Horizons 35 4., 7381. Skinner, W., 1969. Manufacturingthe missing link in corporate strategy. Harvard Business Review 47 3., 136145. Skinner, W., 1985. The taming of lions: how manufacturing leadership evolved, 17801984. In: Clark, K.B., Hayes, C., Lorenz, C. Eds.., The Uneasy Alliance: Managing the ProductivityTechnology Dilemma. Harvard Business School Press, Boston, pp. 257270. Skinner, W., 1986. The productivity paradox. Harvard Business Review 64 4., 5559. Slack, N., 1987. The flexibility of manufacturing systems. International Journal of Operations and Production Management 4 4., 3545. Stalk, G., Hout, T., 1990. Competing Against Time. The Free Press, New York. Stark, G., 1989. Timethe next source of competitive advantage. Harvard Business Review 67 4., 4151. Susman, G.I.,1990. Work groups: autonomy, technology, and choice. In: Goodman, P.S., Sproull, L.S., Associates Eds.., Technology and Organizations. Jossey-Bass, San Francisco, pp. 87108. Susman, G.I., Chase, R.B., 1986. A sociotechnical analysis of the integrated factory. The Journal of Applied Behavioral Science 22 3., 257270. Swamidass, P.M., Newell, W.T., 1987. Manufacturing strategy,

428

M. Tracey et al. r Journal of Operations Management 17 (1999) 411428 Ward, P.T., Leong, G.K., Boyer, K.K., 1994. Manufacturing proactiveness and performance. Decision Sciences 25 3., 337358. Weick, K.E., 1990. Technology as equivoque: sensemaking in new technologies. In: Goodman, P.S., Sproull, L.S., Associates Eds.., Technology and Organizations. Jossey-Bass, San Francisco, pp. 144. Wheelwright, S.C., Clark, K.B., 1992. Revolutionary Product Development. The Free Press, New York. Wheelwright, S.C., Sasser, W.E., 1989. The new product development map. Harvard Business Review 67 3., 112125. Zuboff, S., 1988. In the Age of the Smart Machine: The Future of Work and Power. Basic Books, New York.

environmental uncertainty and performance: a path analytic model. Management Science 33 4., 9524. Upton, D.M., 1994. The management of manufacturing flexibility. California Management Review, Winter, 7289. Venkatraman, N., Ramanujan, V., 1986. Measurements of business performance in strategy research: a comparison of approaches. Academy of Management Review 11 10., 801814. Vonderembse, M.A., Raghunathan, T.S., Rao, S., 1997. A post-industrial paradigm: to integrate and automate manufacturing. International Journal of Production Research 35 9., 2579 2599. Vonderembse, M.A., Tracey, M., Tan, C.L., Bardi, E.J., 1995. Current purchasing practices and JIT: some of the effects on inbound logistics. International Journal of Physical Distribution and Logistics Management 25 3., 3348.