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Flexibility Ratios and Manufacturing Strategy

Author

Listed:
  • John E. Ettlie

    (School of Business Administration, The University of Michigan, Ann Arbor, Michigan 48109-1234)

  • Joan D. Penner-Hahn

    (School of Business Administration, The University of Michigan, Ann Arbor, Michigan 48109-1234)

Abstract

In this exploratory, empirical study of modernizing durable goods plants, it was found that typical measures of flexibility (e.g., number of unique parts and part families) are independent. More importantly, plants and firms with greater strategic manufacturing focus, regardless of specific emphasis (e.g., cost or quality), scheduled fewer part numbers on new flexible automation systems. This suggests that product focus and strategic focus are related in plants producing discrete parts. When flexibility is emphasized as a strategic manufacturing focus, new automation systems are significantly more likely to have shorter change-over times per part family. In general, part family-changeover time ratios appear to have the greatest potential of measures evaluated for building a useful theory of flexibility in discrete parts manufacturing. An evaluation of changes made in part types and part families during the implementation period showed that product flexibility is pursued as a way to reduce high labor costs in manufacturing. These plants accomplished this end by increasing the number of parts scheduled on new systems. Implications for strategic management of flexibility and scope are presented.

Suggested Citation

  • John E. Ettlie & Joan D. Penner-Hahn, 1994. "Flexibility Ratios and Manufacturing Strategy," Management Science, INFORMS, vol. 40(11), pages 1444-1454, November.
    • Handle: RePEc:inm:ormnsc:v:40:y:1994:i:11:p:1444-1454
    DOI: 10.1287/mnsc.40.11.1444
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    Citations

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    Cited by:

    1. Saravanan Kesavan & Bradley R. Staats & Wendell Gilland, 2014. "Volume Flexibility in Services: The Costs and Benefits of Flexible Labor Resources," Management Science, INFORMS, vol. 60(8), pages 1884-1906, August.
    2. Beach, R. & Muhlemann, A. P. & Price, D. H. R. & Paterson, A. & Sharp, J. A., 2000. "A review of manufacturing flexibility," European Journal of Operational Research, Elsevier, vol. 122(1), pages 41-57, April.
    3. Dangayach, G.S. & Deshmukh, S.G., 2006. "An exploratory study of manufacturing strategy practices of machinery manufacturing companies in India," Omega, Elsevier, vol. 34(3), pages 254-273, June.
    4. Jörg Claussen & Christian Essling & Christian Peukert, 2018. "Demand variation, strategic flexibility and market entry: Evidence from the U.S. airline industry," Strategic Management Journal, Wiley Blackwell, vol. 39(11), pages 2877-2898, November.
    5. Raturi, Amitabh S. & Jack, Eric P., 2004. "Creating a volume-flexible firm," Business Horizons, Elsevier, vol. 47(6), pages 69-78.
    6. John E. Ettlie, 1998. "R&D and Global Manufacturing Performance," Management Science, INFORMS, vol. 44(1), pages 1-11, January.
    7. Schneeweiss, Ch. & Schneider, H., 1999. "Measuring and designing flexibility as a generalized service degree," European Journal of Operational Research, Elsevier, vol. 112(1), pages 98-106, January.
    8. Kenneth K. Boyer, 1999. "Evolutionary Patterns of Flexible Automation and Performance: A Longitudinal Study," Management Science, INFORMS, vol. 45(6), pages 824-842, June.
    9. Choe, Pilsung & Tew, Jeffrey D. & Tong, Songzhen, 2015. "Effect of cognitive automation in a material handling system on manufacturing flexibility," International Journal of Production Economics, Elsevier, vol. 170(PC), pages 891-899.

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