Peter Barrar

MRPII implementation: key factors for success

Abstract Successful implementation of MRPII depends on effective management control of manufacturing systems projects. In this paper we present the results of detailed research into the implementation process in different companies. Common problems are highlighted, and the difference between successful and unsuccessful implementations is examined. Our aim is to provide a guide to help managers avoid some of the pitfalls along the road to the MRPII goal.

Proven methods for innovation management: an executive wish list

Innovation specialists from the largest British companies discussed what they wanted to know about innovation, and asked the academic community to suggest some answers. Some, but by no means all, of their questions had already been answered in the published literature. The behaviours that support a culture of innovation include a market orientation, an innovation-friendly ruling coalition, and organisational structures that propel novelty. These behaviours also encourage creativity if the risk-taking employees are rewarded for success and if they are asked to explain their personal mission at intervals. Several methods which researchers have found effective for the identification of ideas which may become market winners are discussed, as are methods building organisational competencies for innovation. Some of their remaining questions are being addressed by research projects currently in progress.

The efficiency of accounting service provision

The paper uses a procedure called data envelopment analysis (DEA) to compare internal against external (outsource) efficiency in the delivery of finance function activities. The approach allows a direct comparison between the in‐house efficiency of UK small, medium and large companies in managing their accounting activities both with UK outsource contractors and also against the rather larger and more numerous contractors observed in Italy. The paper finds that, through comparative advantages, outsourcing presents a more efficient solution for the management of very small firm accounting than internal provision. Furthermore, there is evidence that substantial scale benefits continue to be available to outsource contractors, while inefficiency on internal provision is mainly technical. The paper concludes that outsourcing provision is likely to offer worthwhile savings to small firms, allowing them to shed competitive weaknesses and operate at efficient or best practice levels. At the same time, by converting an internal fixed cost, fixed capacity activity into a flexible, variable cost activity, SMEs have the potential to transform a previously unmanageable activity into an efficient or best practice activity that can grow or contract with the business.

Performance implications of strategy‐technology connections: an empirical examination

Purpose – The purpose of this paper is to test the positive effect of strategy‐technology integration on performance in comparison with the impact of other types of strategies.Design/methodology/approach – General conclusions are drawn and strategic implications derived from a survey of 355 UK manufacturing companies which had expressed interest in the introduction of new computer‐based technology.Findings – It was found that the companies with strategy‐technology integration showed better financial and operational performance. Strategies of technology leadership and market orientation were also associated with enhanced financial performance. However, a number of organisational conditions were found to be necessary for the pursuit of these strategies.Research limitations/implications – Further research is needed to examine the process and structure in which strategy technology can be better integrated.Practical implications – Firms should strive to achieve strategy‐technology integration to maximise the b...

Overage inventory—how does it occur and why is it important?

Abstract Well-planned inventory is important to the successful operation of most healthy businesses. What this means, is that planning needs to be carried out to deal with three conditions: • The possibility of too little inventory due to uncertainty (safety stock), • the replenishment of the inventory cycle due to depletion through normal demand (cycle stock), • the probability of overage—or too much inventory, when assessed against planned levels. The consequences for businesses are important at both item level and in the aggregate. At the item level, the inability to supply can have dire consequences for customer service and at the aggregate inventory level, for the operational, cash flow and working capital requirements of the business. The paper argues that overage is important because there is evidence that, even in well-managed businesses a significant proportion of the inventory is in overage at any given time. Evaluations of twenty-inventory profiles from companies in different business sectors show between 10% and 98% of the inventory values were ‘in overage’. For most businesses this will not be a trivial amount and any actions that can reduce it will bring significant benefit. The paper concludes that overage should be recognised in the same way as safety stock and thus, formally planned. Hence the effective control of overage will enhance the businesss profitability by minimising the inventory investment.

The Management of Knowledge during Design and Implementation of Process Technologies

Knowledge and learning play a major part in the successful implementation of process technologies. We suggest that managers of implementation projects can improve the initial performance levels of the process in which a new technology resides by ensuring that useful knowledge, present in the organization at the start of the implementation project, is employed to greatest effect during the design of the modified process and that new learning is not lost. This does not necessarily require major investment in computerized systems – merely exploring what potentially useful knowledge is already available within the organization, or can readily be obtained from external contact, may improve the efficiency of technology implementation. Use of available knowledge can also help to speed up the implementation process by reducing the number of, and time required for, the adaptations necessary to get the process to the desired performance level.

Manufacturing strategy: A study of machine tool companies in the UK☆

Abstract This paper describes findings from an empirical study carried out in a group of small to medium sized companies within the U.K. machine tool industry. Notions of manufacturing strategy are discussed and a contingency model of change within production systems is proposed. Based on the model, a research programme is described, the object of which was to determine why firms adopt particular production systems, under what conditions these are changed, and the criteria and procedures which are used. A focus for change is taken to be the make-or-buy decision. The results showed that the key criteria used by the firms in their evaluations were: capacity, utilization and process capability (technology). From the study, it is concluded that response to change was largely based upon operational considerations and that the firms lacked a framework for reviewing the strategic implications of their decisions. Hence, the need is argued for a methodology whereby firms can establish consistent functional strategies, with the plans and policies to achieve them.

Evaluation of vendor documentation in the acquisition of MRP and related manufacturing software

Abstract For most managers setting out to acquire a new MRP system for their company, the review and evaluation of product documentation is a critical first step in the acquisition and implementation process. Objective data is needed in order to narrow down the available alternatives. This study investigates how vendors describe and differentiate their products within their promotional literature, and what claims they make for them. Evaluation of documentation covering 69 manufacturing software products shows that vendors are (1) targeting products across very broad industry groups, (2) emphasizing service-related attributes in client relationships, but (3) are ignoring implementation issues, and (4) are failing to provide explicit advice to prospective users on potential costs and benefits.

Supply Chain Dynamics, the case of FRITO-LAY in Latin America

We present a case study about the structural causes of the Bullwhip Effect. We based our research on a set of semi-structured interviews and built up a simulation model to analyse the impact on performance of operational policies used by supply chain managers. The case is SNACKS INC., a Latin American branch of Frito-Lay International. We discuss which policies will require further adjustments in order to fully explode the capabilities of their new Information Systems, and Advanced Planning System module (APS) of their current Enterprise Resource Planning (ERP) structure. This paper exemplifies a new way in which the supply chain structures can be analysed to study the distortions on information and production orders, commonly called the Bullwhip Effect.

Incorporating competitive advantage into the process technology investment decision

Evidence suggests that few organisations specifically factor competitive advantage into process technology investment decisions, despite evidence that companies who invest for market reasons tend to be more successful. This article outlines a five-step method that companies can use to ensure that competitive advantage is explicitly included in the investment decision. The steps outlined assume that a company wishes to invest in process technology to achieve an advantage. The five steps require an estimation of the competitive position, identification of a potential competitive advantage, discrimination between projects based on competitive advantage factors, financial appraisal and a final check to ensure that the proposed investment fits the strategy.