Aleda V. Roth

The influence of an integration strategy on competitive capabilities and business performance: An exploratory study of consumer products manufacturers

Abstract In this paper, we expand upon recent research by Frohlich and Westbrook [J. Operations Manage. 19 (2) (2001) 185] that characterizes the influence of supply chain integration on performance. Introducing supply chain integration intensity as a proxy variable for Frohlich and Westbrook’s [J. Operations Manage. 19 (2) (2001) 185] ‘outward-facing supply chain strategy’, we investigate the ways that manufacturing-based competitive capabilities mediate the relationship between supply chain integration and business performance. While previous research suggests that supply chain integration is directly related to superior business performance, the mediating role of manufacturing capabilities has not been explored. Using hierarchical regression analysis, we develop and test a theory-based model using a sample of consumer products manufacturers. Contrary to Frohlich and Westbrook’s [J. Operations Manage. 19 (2) (2001) 185] assertions regarding the applicability of the ‘outward-facing strategy’ to the consumer goods sector, our results provide empirical evidence that supply chain integration intensity leads directly to improved business performance, thus corroborating the conventional wisdom concerning the increasing importance of supply chain integration in the consumer products sector. In addition, this study uncovers empirical evidence for the mediating role of manufacturing-based competitive capabilities in supply chain management. These results support the growing call for a broader, more generalized view of manufacturing strategy.

Enterprise Resource Planning (ERP) Competence Constructs: Two‐Stage Multi‐Item Scale Development and Validation*

This paper defines and operationalizes eight ERP competence constructs. We define ERP competence as a portfolio of managerial, technical and organizational skills and expertise posited as antecedents to improved business performance occurring after an ERP system is operational and functionally stable. To improve responses to changes in markets and products, manufacturers are increasingly adopting ERP systems. However, anecdotal accounts indicate that the realization of ERPs potential benefits is rare. Because of its pervasive influence on manufacturing and business performance, the need for scientifically developed and tested multi-item scales pertaining to ERP competence is highly relevant to manufacturing strategy research. We follow a two-stage normative process of scale development. First, we identify a portfolio of eight generic constructs that are hypothesized to be associated with successful ERP adoption. Each construct is then operationalized as a multi-item measurement scale by applying a manual item sorting technique iteratively to independent panels of expert judges until tentative reliability and validity is established. Second, we further refine and validate the multi-item scales using survey data from 79 North American manufacturing users of ERP systems.

E-services: operating strategy—a case study and a method for analyzing operational benefits

The Internet’s influence in creating e-services has been revolutionary for providers and their customers. Unfortunately, there has been a wide gap between inspiring applications of the Internet that help increase service customization while maintaining or even improving delivery efficiency, and downright flops in which companies that have made bold promises have failed to deliver on even a portion of their pledges. This paper provides an examination of e-services utilizing three approaches in order to provide guidance on how to fly rather than flop. First, we develop a model of the e-service customer retention. Second, we offer a case study of Sothebys.com to illustrate how a well-known, but not typically technologically adventurous, company can utilize e-services to expand its offerings and streamline its services. Finally, we offer a profiling technique for analyzing the benefits and challenges of e-services for particular industries.

Antecedents of New Service Development Effectiveness: An Exploratory Examination of Strategic Operations Choices

This article examines the strategic process of new service development (NSD). The authors empirically explore the strategic influence of team-based organizational structure, NSD process design, and information technology (IT) choices on the speed and effectiveness of NSD efforts. Several literature-based relationships are tested with a recursive path model using a multi-industry sample of U.S. service organizations. Most results for the service sector are similar to those found in manufacturing: (a) NSD cross-functional team structures directly influence the effectiveness of the firm’s NSD efforts, (b) more formalized NSD processes indirectly influence the firm’s ability to develop new services by increasing the speed of NSD, and (c) IT choices directly affect both the speed of the NSD process and the general effectiveness of the firm’s NSD activities. Contrary to expectations, no direct relationship between the use of cross-functional team structures and the speed of NSD was found.

Why should marketing and manufacturing work together?: Some exploratory empirical results

This paper presents an exploratory investigation of the Manufacturing/Marketing (hereafter M/M) interface. From the literature and prior empirical work in M/M strategies, we propose a path model for assessing the mediating impact of the M/M interface harmony on M/M morale and business performance. Using two convenience samples of executives, we empirically test the direct and indirect influence of predisposing factors (antecedents) and performance outcomes (consequences) that are expected theoretically to influence or be influenced by M/M interface harmony, which we operationalize as the functions ability to work together. We find that 11 of the 13 hypothesized direct effects are significant at the .012 level or below; and attesting to the mediating influence of the M/M ability to work together, 11 of the 12 indirect effects were significant at the .02 level or below. Increasing the emphasis on either or both of the importance of marketing or manufacturing improves the odds of both functions ability to work harmoniously, which in turn impacts M/M morale. Notably, interfunctional harmony appears to have a stronger influence on each functions morale than the importance attached to that function, ceteris paribus. Counter to conventional wisdom, the study provides insight on the distinctive roles whereby marketing and manufacturing functions influence performance. Marketing acts to improve competitive position and profitability through the mediating influence of M/M interface harmony and improved marketing morale. On the other hand, manufacturing morale was not shown to be a significant factor impacting performance. Rather, the emphasis on manufacturing impacts competitive position directly as indicated by the resource-based view of manufacturing strategy. This exploratory study provides new empirical evidence that the M/M interface harmony, as expressed by the functions ability to work together, matters significantly to business outcomes directly and indirectly, and that the behavioral or soft side of M/M strategies merit attention in future research.

Competitive advantage through take-back of used products

Abstract Motivated by a recent antitrust ruling against Hill–Rom, one of the two dominant American suppliers of hospital beds, we develop a stylized model to investigate the consequences of used product take-back on firms, industry and customers. Our findings suggest that by taking back and reselling refurbished products, a manufacturer can increase both profit margins and sales––to the detriment of a non-interfering competitor. In our model, customers are always better off under product take-back, but it depends on the degree of competition, whether firms use the benefits of take-back primarily to increase their margins or to pass them on to the customers by lowering their prices. The first firm to offer take-back, in some cases, can deter its competitors from following this profitable strategy, especially if it has an existing advantage in terms of lower production cost or higher market share. Contrary to the claim of Hill–Roms competitor, we find a “legitimate business justification” for Hill–Roms reduction of new product prices.

A Tale of Two Countries’ Conservatism, Service Quality, and Feedback on Customer Satisfaction

This article compares the influence of service quality on customer satisfaction in the United Kingdom and the United States and considers the moderating effect of systematic customer feedback and complaint processes. Propositions are developed concerning country differences based on British conservatism. Hypotheses were tested using data from the International Service Study. The results support the conservatism hypothesis, empirically demonstrating that customer reaction to good service is similar, but U.K. and U.S. customers tend to respond differently to poor service encounters based on cultural norms. The authors propose that customer feedback is an often-overlooked factor in explaining the relationship between service quality and customer satisfaction. Much valuable customer feedback may be unrealized in Britain, thus losing the opportunity to improve service design and delivery and creating a vicious cycle. Without intervention, British service firms will continue to deliver levels of service lower than would be acceptable in the United States.

Agility in Retail Banking: A Numerical Taxonomy of Strategic Service Groups

This research demonstrates that operations agility--defined as the ability to excel simultaneously on operations capabilities of quality, delivery, flexibility, and cost in a coordinated fashion--is a viable option for retail banks encountering increasing environmental change. The question of whether there is empirical evidence that services, specifically retail banks, display the characteristics of agility like their manufacturing counterparts is open to debate. Conventional wisdom in operations management posits that most successful services trade off one capability for another. Drawing from the resource-based view of the firm, combinative capabilities view, and the cybernetics work of Ashby (1958), theoretical arguments suggest the contrary. The agility paradigm is viable in environments calling for a mix of strategic responses. Applying cluster analytic techniques to a sample of retail banks, using capabilities as taxons, we identify four strategic service groups: agile, traditionalists, niche, and straddlers. Our empirical results provide thematic explanations consistent with theory that account for how the agile strategic group offers a unique configuration of service concept, resource competencies, strategic choices, and business orientation. Profiles of the operations strategies of each strategic service group suggest that each group has found a fit between what certain segments of the market may want and what they have to offer. In particular, we found that the agile group exhibited greater resource competencies than its counterparts, requiring greater investments in infrastructure and technology. Consistent with theory, agile banks performed better over time on an absolute measure of return on assets.

Achieving competitive capabilities in e-services

Abstract What implications does the Internet have for service operations strategy? How can business performance of e-service companies be improved in todays knowledge-based economy? These research questions are the subject of this paper. We propose a model that links the e-service companys knowledge-based competencies with their competitive capabilities. Drawing from the current literature, our analysis suggests that services that strategically build a portfolio of knowledge-based competencies, namely human capital, structural capital, and absorptive capacity have more operations-based options, than their counterparts who are less apt to invest. We assume that the combinative capabilities of service quality, delivery, flexibility, and cost are determined by the investment in intellectual capital. Arguably, with the advent of the Internet, different operating models (e.g., bricks-and-mortar, clicks-and-mortar, or pure dot-com) have different strategic imperatives in terms of knowledge-based competencies. Thus, the new e-operations paradigm can be viewed as a configuration of knowledge-based competencies and capabilities.

Beyond the House of Quality: Dynamic QFD

Describes a dynamic approach to quality function deployment (QFD) that translates customer wants and needs into relevant product and process parameters. Using feedback loops, this new approach incorporates updated customer satisfaction data and dynamically links evolving requirements directly back into manufacturing and related processes. Updated customer requirements “peg” the key parameters in statistical process control charts. Introduces the concept, illustrates the mechanics of the approach, and describes how it benefited an IBM assembly plant.