IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i22p14811-d968336.html
   My bibliography  Save this article

Developing Effective Measures of Organizational Capability of Manufacturing Firms: An Exploratory Case Study of Japanese Manufacturing Firms

Author

Listed:
  • Takahiro Fujimoto

    (Institute for Business and Finance, Waseda University, 1-6-1 Nishiwaseda, Shinjuku-ku, Tokyo 169-8050, Japan)

  • Mitsuhiro Fukuzawa

    (Faculty of Business Administration, Seikei University, 3-3-1 Kichijoji-Kitamachi, Tokyo 180-8633, Japan)

  • Young Won Park

    (Graduate School of Humanities and Social Sciences, Saitama University, 255 Shimo-Okubo, Sakura-ku, Saitama 338-8570, Japan)

  • Paul Hong

    (John B. and Lillian E. Neff College of Business and Innovation, The University of Toledo, Toledo, OH 43606, USA)

Abstract

The present article explores the flow-oriented and routine-based concept of organizational capability in manufacturing and proposes a practical method of measuring it by using the flow map of material and information (FMMI), including the value stream map (VSM). The environment surrounding manufacturing companies is becoming increasingly turbulent, making it increasingly difficult for them to survive and prosper. For example, global companies face challenges on multiple fronts such as international trade tensions, pandemic lockdowns, and competitive challenges from firms in emerging economies. In addition, in digital markets, supply chain transparency and resiliency require visualizing the flow of materials and information across a wide range of global activities. Business activities are conceived as flows of design and control information from across functions for value creation and transfer. A high level of value creation is built on the excellence of vital function. In this context, this study aims to identify key characteristics of high-performance firms. In particular, the flow map of material and information (FMMI) assumes simultaneous execution of capability-building and capability-measuring. This research team reports the series of workshops and survey results based on (1) the work of the industry-university consortium, (2) the collaborative learning process through trust and information sharing among participating companies, (3) sharing improvement activities, and (4) identifying areas of poor flow (issues for each company). In addition, several selected case studies of Japanese firms highlight the impact of using FMMI for improving multiple performance outcomes and measuring their manufacturing capabilities at the same time. The lessons and implications are discussed.

Suggested Citation

  • Takahiro Fujimoto & Mitsuhiro Fukuzawa & Young Won Park & Paul Hong, 2022. "Developing Effective Measures of Organizational Capability of Manufacturing Firms: An Exploratory Case Study of Japanese Manufacturing Firms," Sustainability, MDPI, vol. 14(22), pages 1-20, November.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:22:p:14811-:d:968336
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/22/14811/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/22/14811/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Markus C. Becker, 2004. "Organizational routines: a review of the literature," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 13(4), pages 643-678, August.
    2. Markus C. Becker, 2004. "Organizational routines : a review of the literature," Post-Print hal-00279010, HAL.
    3. David D. Dobrzykowski & Rudolf Leuschner & Paul C. Hong & James J. Roh, 2015. "Examining Absorptive Capacity in Supply Chains: Linking Responsive Strategy and Firm Performance," Journal of Supply Chain Management, Institute for Supply Management, vol. 51(4), pages 3-28, October.
    4. Carliss Y. Baldwin & Kim B. Clark, 2000. "Design Rules, Volume 1: The Power of Modularity," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262024667, April.
    5. David J. Teece, 2007. "Explicating dynamic capabilities: the nature and microfoundations of (sustainable) enterprise performance," Strategic Management Journal, Wiley Blackwell, vol. 28(13), pages 1319-1350, December.
    6. John Paul MacDuffie & Kannan Sethuraman & Marshall L. Fisher, 1996. "Product Variety and Manufacturing Performance: Evidence from the International Automotive Assembly Plant Study," Management Science, INFORMS, vol. 42(3), pages 350-369, March.
    7. Davies, Andrew & Brady, Tim, 2000. "Organisational capabilities and learning in complex product systems: towards repeatable solutions," Research Policy, Elsevier, vol. 29(7-8), pages 931-953, August.
    8. da Silveira, Giovani J.C., 2014. "An empirical analysis of manufacturing competitive factors and offshoring," International Journal of Production Economics, Elsevier, vol. 150(C), pages 163-173.
    9. Alfred D. Chandler, 1992. "Organizational Capabilities and the Economic History of the Industrial Enterprise," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 79-100, Summer.
    10. Hong, Paul & Jagani, Sandeep & Kim, Jinhwan & Youn, Sun Hee, 2019. "Managing sustainability orientation: An empirical investigation of manufacturing firms," International Journal of Production Economics, Elsevier, vol. 211(C), pages 71-81.
    11. Fujimoto, Takahiro, 1999. "The Evolution of Manufacturing Systems at Toyota," OUP Catalogue, Oxford University Press, number 9780195123203.
    12. Aoki, Katsuki & Staeblein, Thomas & Tomino, Takahiro, 2014. "Monozukuri capability to address product variety: A comparison between Japanese and German automotive makers," International Journal of Production Economics, Elsevier, vol. 147(PB), pages 373-384.
    13. Yang, Ma Ga (Mark) & Hong, Paul & Modi, Sachin B., 2011. "Impact of lean manufacturing and environmental management on business performance: An empirical study of manufacturing firms," International Journal of Production Economics, Elsevier, vol. 129(2), pages 251-261, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Verreynne, Martie-Louise & Hine, Damian & Coote, Len & Parker, Rachel, 2016. "Building a scale for dynamic learning capabilities: The role of resources, learning, competitive intent and routine patterning," Journal of Business Research, Elsevier, vol. 69(10), pages 4287-4303.
    2. Hermano, Víctor & Martín-Cruz, Natalia, 2016. "The role of top management involvement in firms performing projects: A dynamic capabilities approach," Journal of Business Research, Elsevier, vol. 69(9), pages 3447-3458.
    3. Loock, Moritz & Hinnen, Gieri, 2015. "Heuristics in organizations: A review and a research agenda," Journal of Business Research, Elsevier, vol. 68(9), pages 2027-2036.
    4. Davies, Andrew & Frederiksen, Lars & Cacciatori, Eugenia & Hartmann, Andreas, 2018. "The long and winding road: Routine creation and replication in multi-site organizations," Research Policy, Elsevier, vol. 47(8), pages 1403-1417.
    5. Cristina Fernandes & João J. Ferreira & Mário L. Raposo & Cristina Estevão & Marta Peris-Ortiz & Carlos Rueda-Armengot, 2017. "The dynamic capabilities perspective of strategic management: a co-citation analysis," Scientometrics, Springer;Akadémiai Kiadó, vol. 112(1), pages 529-555, July.
    6. Gillani, Fatima & Chatha, Kamran Ali & Sadiq Jajja, Muhammad Shakeel & Farooq, Sami, 2020. "Implementation of digital manufacturing technologies: Antecedents and consequences," International Journal of Production Economics, Elsevier, vol. 229(C).
    7. Roberto Grandinetti, 2022. "A Routine-Based Theory of Routine Replication," Sustainability, MDPI, vol. 14(14), pages 1-23, July.
    8. Fernando F. Suarez & Juan S. Montes, 2019. "An Integrative Perspective of Organizational Responses: Routines, Heuristics, and Improvisations in a Mount Everest Expedition," Organization Science, INFORMS, vol. 30(3), pages 573-599, May.
    9. Lisa Östbring & Rikard Eriksson & Urban Lindgren, 2015. "Relatedness through experience: On the importance of collected worker experiences for plant performance," Papers in Evolutionary Economic Geography (PEEG) 1530, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Sep 2015.
    10. Olejniczak Tomasz & Itohisa Masato, 2017. "Hybridization Revisited: New Insights from the Evolutionary Approach," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 25(2), pages 43-62, June.
    11. Robert Charles Sheldon & Eric Michael Laviolette & Fabien Geuser, 2020. "Explaining the process and effects of new routine introduction with a notion of micro-level entrepreneurship," Journal of Evolutionary Economics, Springer, vol. 30(3), pages 609-642, July.
    12. Brusoni, Stefano & Rosenkranz, Nicole A., 2014. "Reading between the lines: Learning as a process between organizational context and individuals’ proclivities," European Management Journal, Elsevier, vol. 32(1), pages 147-154.
    13. Rouslan Koumakhov & Adel Daoud, 2017. "Routine and reflexivity: Simonian cognitivism vs practice approach," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 26(4), pages 727-743.
    14. Schubert, Torben & Tavassoli, Sam, 2019. "Product Innovation and Educational Diversity in Top and Middle Management Teams," Papers in Innovation Studies 2019/3, Lund University, CIRCLE - Centre for Innovation Research.
    15. Fritz Rahmeyer, 2010. "A Neo-Darwinian Foundation of Evolutionary Economics. With an Application to the Theory of the Firm," Discussion Paper Series 309, Universitaet Augsburg, Institute for Economics.
    16. Gary P. Pisano, 2017. "Toward a prescriptive theory of dynamic capabilities: connecting strategic choice, learning, and competition," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 26(5), pages 747-762.
    17. Jutta Wollersheim & Koen H. Heimeriks, 2016. "Dynamic Capabilities and Their Characteristic Qualities: Insights from a Lab Experiment," Organization Science, INFORMS, vol. 27(2), pages 233-248, April.
    18. Neil M Kay, 2018. "We need to talk: opposing narratives and conflicting perspectives in the conversation on routines," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 27(6), pages 943-956.
    19. Shumpei Iwao, 2017. "Revisiting the existing notion of continuous improvement (Kaizen): literature review and field research of Toyota from a perspective of innovation," Evolutionary and Institutional Economics Review, Springer, vol. 14(1), pages 29-59, June.
    20. Xinwei Ye & Lei Ma & Junwen Feng & Yang Cheng & Zheng Liu, 2018. "Impact of Technology Habitual Domain on Ambidextrous Innovation: Case Study of a Chinese High-Tech Enterprise," Sustainability, MDPI, vol. 10(12), pages 1-21, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:22:p:14811-:d:968336. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.