Plant roles: Site competence bundles and their relationships with site location factors and performance

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TY - JOUR

T1 - Plant roles: Site competence bundles and their relationships with site location factors and performance

AU - Feldmann, Andreas

AU - Olhager, Jan

PY - 2013

Y1 - 2013

N2 - Purpose - The purpose of this paper is to investigate the strategic role of plants, in terms of the type and level of site competence, the relationship with the strategic reason for location, and the impact on operational performance. Design/methodology/approach - The authors use a survey of 103 Swedish manufacturing plants that belong to global production networks and analyze patterns within this context to identify potential archetypes of plants with respect to plant roles, based on factor analysis and cluster analysis. Findings - It is found that the areas of site competence can be grouped into three bundles, characterized thematically as production-related, supply chain-related and development-related. 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. No significant relationship was found between the level of site competence and the strategic reason for site location. Practical implications - The results provide empirical support for the co-location of product development and production, since plants with full responsibility for all competence bundles significantly outperform plants having only production-related competences on cost efficiency, quality, and new product introductions. Originality/value - The authors research patterns of site competence at a more detailed level than before in the related literature, as well as study the impact on performance, which has not been done before.

AB - Purpose - The purpose of this paper is to investigate the strategic role of plants, in terms of the type and level of site competence, the relationship with the strategic reason for location, and the impact on operational performance. Design/methodology/approach - The authors use a survey of 103 Swedish manufacturing plants that belong to global production networks and analyze patterns within this context to identify potential archetypes of plants with respect to plant roles, based on factor analysis and cluster analysis. Findings - It is found that the areas of site competence can be grouped into three bundles, characterized thematically as production-related, supply chain-related and development-related. 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. No significant relationship was found between the level of site competence and the strategic reason for site location. Practical implications - The results provide empirical support for the co-location of product development and production, since plants with full responsibility for all competence bundles significantly outperform plants having only production-related competences on cost efficiency, quality, and new product introductions. Originality/value - The authors research patterns of site competence at a more detailed level than before in the related literature, as well as study the impact on performance, which has not been done before.

KW - Sweden

KW - Manufacturing industry

KW - Operations management

KW - Plant location

KW - and layout

KW - Empirical research

KW - Global production networks

KW - Manufacturing plants

KW - Operations strategy

U2 - 10.1108/IJOPM-03-2011-0077

DO - 10.1108/IJOPM-03-2011-0077

M3 - Article

VL - 33

SP - 722

EP - 744

JO - International Journal of Operations and Production Management

JF - International Journal of Operations and Production Management

SN - 0144-3577

IS - 6

ER -