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The adoption of radical manufacturing technologies and firm survival

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  • Rajiv K. Sinha
  • Charles H. Noble

Abstract

The emergence of dramatically innovative, or radical, new manufacturing technologies can force pivotal and life‐threatening decisions for industry competitors. These technologies can represent a huge cost for adopting firms, but may also offer the chance to achieve competitive advantage through superior manufacturing. While prior research has considered a range of production process decisions (e.g., JIT, mass customization) and outcomes for end‐product technologies, little attention has been given to adoption decisions relative to core manufacturing technologies. This study examines an industry's adoption of major manufacturing technologies over several decades and demonstrates that two groups of contingencies related to adoption (e.g., timing and cumulative effects) have a significant impact on firm performance. Based on a sample of over 1,000 firms, the results provide insights into the effects of adoption timing and ‘manufacturing technology bundles’ on firm survival. We also find that adoption of manufacturing technologies prior to the inflection point of the estimated Bass diffusion curve for each technology leads to significant reduction in firm mortality. Thus, we are able to demonstrate the ability of the Bass model to predict the survival outcomes of firms facing manufacturing technology adoption decisions. The strategic implications of these pivotal decisions are considered. Copyright © 2008 John Wiley & Sons, Ltd.

Suggested Citation

  • Rajiv K. Sinha & Charles H. Noble, 2008. "The adoption of radical manufacturing technologies and firm survival," Strategic Management Journal, Wiley Blackwell, vol. 29(9), pages 943-962, September.
    • Handle: RePEc:bla:stratm:v:29:y:2008:i:9:p:943-962
    DOI: 10.1002/smj.687
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    Cited by:

    1. Lars Schweizer & Andreas Nienhaus, 2017. "Corporate distress and turnaround: integrating the literature and directing future research," Business Research, Springer;German Academic Association for Business Research, vol. 10(1), pages 3-47, June.
    2. Baier-Fuentes, Hugo & Andrade-Valbuena, Nelson A. & Huertas Gonzalez-Serrano, Maria & Gaviria-Marin, Magaly, 2023. "Bricolage as an effective tool for the survival of owner-managed SMEs during crises," Journal of Business Research, Elsevier, vol. 157(C).
    3. Del Sarto, Nicola & Isabelle, Diane A. & Di Minin, Alberto, 2020. "The role of accelerators in firm survival: An fsQCA analysis of Italian startups," Technovation, Elsevier, vol. 90.
    4. Ukobitz, Desirée Valeria & Faullant, Rita, 2022. "The relative impact of isomorphic pressures on the adoption of radical technology: Evidence from 3D printing," Technovation, Elsevier, vol. 113(C).
    5. Gómez, Jaime & Vargas, Pilar, 2012. "Intangible resources and technology adoption in manufacturing firms," Research Policy, Elsevier, vol. 41(9), pages 1607-1619.
    6. Kim Wang, 2017. "Technology Deployment By Late Movers," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 21(04), pages 1-25, May.
    7. Deng, Ziliang & Guo, Honglin & Zhang, Weifu & Wang, Chengqi, 2014. "Innovation and survival of exporters: A contingency perspective," International Business Review, Elsevier, vol. 23(2), pages 396-406.
    8. Aghaie, Sina & Javadinia, Amir & Mirahmad, Hooman & Janani, Saeed, 2022. "How incumbents’ response strategy impacts rivals’ market exit timing?," Journal of Business Research, Elsevier, vol. 146(C), pages 251-263.
    9. Zvi Winer & Yitzhak Samuel, 2018. "The paradox of cost minimization and the survival of organizations," Computational and Mathematical Organization Theory, Springer, vol. 24(3), pages 401-421, September.
    10. Falk, Martin, 2013. "A survival analysis of ski lift companies," Tourism Management, Elsevier, vol. 36(C), pages 377-390.
    11. Yefei Yang & Han Han & Peter K. C. Lee, 2017. "An Exploratory Study of the Mechanism of Sustainable Value Creation in the Luxury Fashion Industry," Sustainability, MDPI, vol. 9(4), pages 1-16, March.
    12. Schrettle, Stefan & Hinz, Andreas & Scherrer -Rathje, Maike & Friedli, Thomas, 2014. "Turning sustainability into action: Explaining firms' sustainability efforts and their impact on firm performance," International Journal of Production Economics, Elsevier, vol. 147(PA), pages 73-84.

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