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IJOPM
27,3 The contribution of
manufacturing strategy
involvement and alignment to
282
world-class manufacturing
performance
Steve Brown
School of Business and Economics, University of Exeter, Exeter, UK
Brian Squire
Manchester Business School, Manchester, UK, and
Kate Blackmon
Said Business School, University of Oxford, Oxford, UK

Abstract
Purpose – The purpose of this paper is to explore links between the process of strategy formulation
and subsequent performance in operations within firms.
Design/methodology/approach – An in-depth literature review on resource-based and operations
strategy naturally led to three hypotheses. These are then tested using evidence from field-based case
studies of manufacturing/assembly plants in the computer industry.
Findings – The research suggests that world-class plants incorporate both strategic operations
content and strategic operations processes, whilst low-performing plants do not.
Practical implications – It is argued that involving manufacturing/operations managers in the
strategic planning process helps align manufacturing and business strategy, and this alignment is
associated with higher manufacturing performance. This should be of interest to operations managers
and strategists within firms.
Originality/value – By linking strategic alignment and the manufacturing strategy process to
world-class manufacturing practices and performance, this research adds a new dimension to the
study of world-class manufacturing and more generally to the best practices and practice-performance
debates.
Keywords Operations management, Strategic manufacturing, World-class manufacturing
Paper type Research paper

International Journal of Operations &
Production Management
Vol. 27 No. 3, 2007
pp. 282-302
q Emerald Group Publishing Limited
0144-3577
DOI 10.1108/01443570710725554
Introduction
A key concern of scholarly research in operations management is the contribution of
operations practices to operations and business performance (Ketokivi and Schroeder,
2004a), because operations practices are only valuable if they enhance the performance
of an organization relative to its chosen goals. Although which particular practices an
organization should adopt to achieve high performance has long been a focus of
research in operations management, the resource-based and capability-based views of
sustainable competitive advantage have recently highlighted operations as an
important source of resources and capabilities that are valuable, rare, inimitable, and
sticky (Eisenhardt and Martin, 2000; Teece et al., 1997; Winter, 2003). Operations Contribution of
management determines how operations resources and capabilities are deployed to manufacturing
support the business strategy and hence contributes to overall performance (Anderson
et al., 1991; Meredith and Vineyard, 1993; Ramanujam and Venkatraman, 1987; strategy
Swamidass and Newell, 1987). The resource-based view offers new insights and a
theoretical explanation for heterogeneity, even within similar firms, that results from
different resources and capabilities that make use of the resources as Ketokivi and 283
Schroeder (2004a, p. 174) suggest:
Machines and even people may appear similar going from one electronics assembly plant to
another; however, the routines may appear quite different.
The new theoretical perspectives from strategic management have led to a
reassessment of operations’ best practice prescriptions such as world-class
manufacturing (Hayes and Wheelwright, 1984; Schonberger, 1986; Flynn et al., 1999)
and high-performance manufacturing (Schroeder and Flynn, 2000), and have recently
stimulated considerable interest leading to a special issue of the International Journal
of Operations & Production Management on the RBV in operations, and a special issue
of the Journal of Management Studies focusing on promising practices. However, the
best practices research stream on the strategic content of operations strategy has only
now begun to be integrated with another important concern of operations strategy,
which is closely related to the resource and capability view – that is, the strategic
process by which that content is determined and implemented (Brown and Blackmon,
2005; Brown, 1998, 2000; Ketokivi and Schroeder, 2004a, b). On the other hand, the
strategic management perspective as well as research in manufacturing strategy
suggests that adopting and implementing the right practices is essential to attaining
“world-class” performance.
This paper will report findings from field-based research in the computer industry
that suggests that high-performing firms incorporate both strategic operations content
and strategic operations process, whilst low-performing firms do not. Involvement and
alignment were found to be significantly higher in world-class plants than those within
traditional plants. Hence, we argue that involving manufacturing/operations managers
in the strategic planning process helps align manufacturing and business strategy, and
this alignment is associated with higher manufacturing performance. The paper
presents the theoretical background of the research, describes the research study, and
discusses the research findings, followed by conclusions.

Theoretical background
A considerable body of literature on manufacturing/operations strategy has been
produced since the area was initiated by Skinner (1969, 1974). Skinner introduced
manufacturing strategy as the description of how a company intends to compete in the
marketplace and identified the manufacturing task as one that needs to make
internally consistent choices that reflect the company’s competitive priorities in order
to support the corporate strategy and competitive environment. Hill (1985) and Hayes
and Wheelwright (1984) further developed Skinner’s foundational insights.
Integrating Skinner with the resource-based view of the firm, Hayes and Pisano
(1994) described manufacturing strategy as the process of creating the operating
capabilities that the company needs for the future. According to Ketokivi and
IJOPM Schroeder (2004a, p. 182), a capability can be described as knowing what to do and
27,3 why. Generic manufacturing capabilities have traditionally been defined as quality,
cost, dependability, flexibility, and innovation (Ward et al., 1996). Performance on these
capabilities is linked to business performance (Cleveland et al., 1989; Roth and Miller,
1992; Vickery et al., 1993), such as return on assets (Corbett and Claridge, 2002).
A major debate in the manufacturing strategy literature has been whether generic
284 manufacturing capabilities evolve through trade-offs (Filippini et al., 1995; Hayes and
Wheelwright, 1984; Skinner, 1969) or cumulatively as in the “sand cone” model
(Ferdows and De Meyer, 1990; Ferdows et al., 1986; Noble, 1995). Although the
tradeoffs view initially received strong support, researchers such as Flynn et al. (1999)
have found synergies between competitive priorities, suggesting that there is “one best
way” to achieve multiple manufacturing capabilities, and therefore some researchers
have argued that high-performing firms will resemble each other in practices as well as
performance (Corbett and Claridge, 2002). This isomorphism of manufacturing
practices is a key thesis of best practices research, whether into a focused set
of practices such as quality management or supply chain management, or to a bundled
set of practices across the operations function, which has been variously labelled as
best practice (Hanson and Voss, 1993; Voss, 1995; Voss et al., 1996; Voss et al., 1997),
high-performance manufacturing (Schroeder et al., 2002), lean production (Womack
et al., 1990a), or world-class manufacturing (Flynn et al., 1997, 1999). However, the
best-practices approach, and world-class in particular, have not been universally
accepted. For example, Harrison (1998), who provided an extensive review of the extant
literature in this area, argued that world-class performance across all dimensions
would rarely be found in a single company.
World-class performance has been proposed to result from the adoption of a specific
set of practices, although those practices may vary over time (Flynn et al., 1999).
“World-class” performance itself has been defined in a number of ways over the past
two decades since it was first coined by Hayes and Wheelwright (1984). Schonberger
(1986) qualified world-class as order-of-magnitude improvement over previous
performance, whilst the International Motor Vehicle Programme suggested world-class
implied 50 per cent better performance than competitors (Lowe et al., 1997; Oliver et al.,
1996b; Womack et al., 1990a). Flynn et al. (1999) used inclusion on Schonberger’s Honor
Roll and the opinion of industry experts to distinguish between “world-class” and
“traditional” plants. Other researchers have defined world-class as relative positioning
within an appropriate group of firms, such as above average performers (Ferdows and
De Meyer, 1990), top quartile performers (Filippini et al., 1995) or top decile performers
(Hanson and Voss, 1993).

Linking manufacturing strategy content and process

The resource-led and capability-based views suggest that best practices include the
process by which operations strategy is made and not only by its content. The RBV
highlights the potential for processes as a potential source of competitive advantage
(Dutta et al., 2003; Pisano, 1994), and the emerging practice-based perspective
significantly reinforces this focus on the strategy process (Jarzabkowski, 2003, 2004;
Whittington, 2003; Whittington et al., 2003). Process has thus been a key topic in
strategic management research (Khanna and Gulati, 2000; Pettigrew, 1992; Schendel,
1992; Van De Ven, 1992).
 However, operations strategy research has typically focused on the choice of a Contribution of
generic strategy and the strategic choices that underpin its execution, including the manufacturing
specific practices and/or action programmes that are intended to underpin these
capabilities. Manufacturing strategy includes both content and process (Dangayach strategy
and Deshmukh, 2001; Leong et al., 1990; Minor et al., 1994; Swink and Way, 1995). The
manufacturing strategy process includes the formulation, justification, and
implementation of strategic decisions (Swink and Way, 1995). Acur et al. (2003) 285
linked the formalization of the manufacturing strategy to greater consistency between
competitive priorities, improvement goals and action programs.
The manufacturing strategy must in turn be linked with the business-level and
corporate strategic plans (Gianesi, 1998). Strategic planning integrates different
functions or departments and minimises the pursuit of lower-level sub-goals at the
expense of the overall performance (Ketokivi and Castaner, 2004). Strategic planning
will fail if it is limited to the top management team or planning experts and excludes
other relevant managers (Mintzberg, 1994), since operations managers must develop
strategic initiatives and take actions that are consistent with the strategic plan; and
this requires the participation of middle managers in the strategic planning process
(Wooldridge and Floyd, 1989, 1990). Hence, the involvement of manufacturing
managers in strategic planning is essential to developing “strategic resonance”
between corporate and manufacturing strategies, analogous to the concept of strategic
alignment at the strategic management level (Brown and Blackmon, 2005).
We therefore argue that the investigation of world-class manufacturing (or indeed
any investigation of manufacturing strategy) should include a consideration of the
strategy process by which manufacturing issues are considered and integrated with
business strategy. This argument is supported by a range of propositions from the
strategic management literature that suggest that functional managers need to be
involved in business-level strategic planning. Whilst strategic management research
has mainly focused on top management teams, research suggests that the participation
of middle and functional managers in the strategic planning process should also
enhance the quality of the strategic plan because they have access to different
knowledge than senior managers or planning specialists (Wooldridge and Floyd, 1989,
1990). For example, Dutton and Duncan (1987) argued that the strategic process affects
the strategic content because different issues compete for decision-makers’ attention,
an area where middle managers play an important role through issue selling (Dutton
and Ashford, 1997; Floyd and Wooldridge, 1992). The diversity of participants in the
strategy process has been proposed to lead to higher-quality outcomes, although it may
impede strategic consensus (Iaquinto and Frederickson, 1997; Knight et al., 1999). On
the other hand, if middle managers are excluded from the strategic planning process,
this may create dissatisfaction, low motivation for implementing the strategic plan, or
even to impeding its implementation (Guth and MacMillan, 1986). Hence, including
middle managers in the strategy process has been argued from the strategic
management perspective to improve organizational performance (Wooldridge and
Floyd, 1990).
There is also support from the operations literature. First, findings about the
involvement of operations managers in strategic planning (Anderson et al., 1991;
Hill, 1995; Papke-Shields and Malhotra, 2001; Swamidass and Newell, 1987; Ward et al.,
1995) suggest that manufacturing involvement can improve performance.
IJOPM However, trying to establish links between senior-level manufacturing staff and
27,3 business strategy is a difficult and demanding task for two reasons. From the plant
view, there is very little consistency in the role of manufacturing managers. Some
managers within plants have constant links with either the parent company or
corporate offices and are in constant dialogue and involved in business decisions, while
others clearly are not.
286 If strategy involves (inter alia) senior-level personnel whose role includes
guarding operations capabilities, does this mean that the operations function needs
to have a boardroom level presence? If no such presence exists, does this absence
have implications for the firm’s operations performance? This leads to our first
hypothesis:
H1. Manufacturing managers are more involved in the strategic planning process
in world-class than non-world-class plants.
Manufacturing strategy can play a role in implementing business strategy,
which manufacturing personnel may or may not have helped to formulate. Further,
manufacturing strategy can play a role in formulating or revising business strategy. In
order for this to happen, manufacturing strategy must be explicit rather than
unarticulated and hence ambiguous. Tunälv (1992), for example, found that firms with
an explicit manufacturing strategy achieve higher return on sales than firms without
such a strategy. This leads to our second hypothesis:
H2. Plant-level strategies are more likely to be stated and to form part of business
strategy in world-class than non-world-class plants.
Furthermore, as well as involvement in the strategy process there must be a strategic
fit between process and content of manufacturing strategy (Hayes and Pisano, 1996) so
that it is aligned with the strategic plan and hence contributes to subsequent
performance (Joshi et al., 2003; Kim and Arnold, 1996; Miller and Roth, 1994;
Papke-Shields and Malhotra, 2001; Sun and Hong, 2002; Ward et al., 1996). Although
what content should be contained within a manufacturing strategy is not always clear,
it has been argued that the content of manufacturing strategy can make a potentially
profound contribution to the wider aspects of business strategy (Anderson et al., 1991;
Meredith and Vineyard, 1993; Papke-Shields and Malhotra, 2001). Hayes and
Wheelwright’s (1984) contribution is particularly important here because it helps to
explain the profound importance, and range, of structural/infrastructure areas that can
be addressed within manufacturing strategy.
For example, claims for the importance of manufacturing strategy have been made
in relation to mass customisation (Spring and Dalrymple, 2000). A key element of
accruing capabilities in flexibility comes from the utilisation of process technology
where, again, the role of manufacturing strategy can be pivotal (Kathuria and Partovi,
2000). Including manufacturing strategy can thus help businesses create new
opportunities and exploit existing market opportunities (Wernerfelt, 1984). This leads
to our final hypothesis:
H3. Strategic decision content areas are more likely to be included in business
strategy in world-class than non-world-class plants.
Method Contribution of
Sample design and research setting manufacturing
We tested the hypotheses using evidence from field-based case studies of
manufacturing/assembly plants in the computer industry. We undertook the strategy
research in two stages over a three-year period. In stage 1, data were collected on
how plants performed in seven areas that have been identified as being important to
measure manufacturing performance at the plant-level. This stage allowed the division 287
of world-class from non-world-class plants. In stage 2, the senior author explored both
the process and content of how plants devised strategies and examined the
involvement of manufacturing personnel in this process. Data were recorded using
semi-formal questionnaires that were administered to senior-level managers whose
positions within the hierarchy of the firms were consistent across the plants.
The case studies comprised nine computer manufacturers located in Europe and
seven located in the USA.
The computer industry was chosen as the research setting for the present study
because personal computer manufacturing and assembly has undergone a radical
transformation from mass production to mass customisation and agile manufacturing,
and has undergone major structural changes from huge, vertically-integrated
mainframe and minicomputer manufacturers such as IBM, NCR, DEC, NEC and Wang,
who were capable of making almost every product component, to a new group of
“contract manufacturers” such as SCI Systems, Solectron, Merix, Flextronics,
Smartflex and Sanmina. The role of manufacturing in the computer industry has
changed and become strategically important as firms have embraced TQM,
just-in-time, MRP/MRPII, etc. and the surviving major computer players, including
Hewlett Packard (Feitzinger and Lee, 1997) and Dell (Magretta, 1998) have moved
away from mass production to mass customisation and agile manufacturing.
Many Personal Computer giants have struggled with operations capabilities and
the ability to develop and sustain a range of operations capabilities is critical for the PC
industry. The ability to learn, adopt, and utilize world-class operations capabilities
does not come about by chance. Instead it comes about by seeking out and
accumulating capabilities. This seems to have been central to Dell’s success over time.
In 2005, Dell “became the first PC maker to hold the rank of (Fortune’s) America’s Most
Admired since the original “PC” maker, IBM in 1986” (Serwer et al., 2005, p. 54.) In
contrast, the recent problems with Hewlett Packard, resulting in the resignation of its
former CEO, Fiorina, were linked to poor operations: “She told us she didn’t a need a
chief operating officer and didn’t think one was wise” (Loomis and Ryan, 2005, p. 72)
However, the operations capabilities were faltering as Business Week (13th December
2004) noted: “(HP) fails to match Dell’s scale and efficiency in the direct system” (Elgin
et al., 2004, p. 4. Moreover, as Elgin (2005, p. 14) noted: “[Fiorina is] good with
marketing; she’s a good speaker for the company,” says a former HP executive. “But
this is a company that doesn’t need a statesman. It needs a hands-on operations
person.”
Thus, if a firm does not possess excellence within its operations capabilities there
will be a gap between strategic intent and strategic performance. It is this gap between
intent and capability that remains a massive hurdle for firms and it has cost many
CEOs their jobs. As Brown (2000, p. 14) noted: “[. . .] it was one of the key reasons for
Compaq ousting Eckhard Pfeiffer at the end of the 1990s: it was one thing to assert
IJOPM back in 1994 that Compaq would “build to customer order”; it was quite another thing
27,3 for the firm to be able to do it. By 1996, only 5 per cent of its PCs were built to order”.

Performance measurement: identifying world-class plants

Data were collected from each manufacturing site about manufacturing performance
for specific criteria. Although performance can be measured either as financial
288 performance or as operational performance (Venkatraman and Ramanujam, 1986),
manufacturing performance was more relevant to plant-level strategic alignment
because manufacturing strategy influences areas as diverse as selecting new process
technologies (Honeycutt et al., 1993; Schroeder et al., 1995; Wathen, 1995; Gagnon, 1999;
Beach et al., 2000), developing new products (Voss et al., 1996; Spring and Dalrymple,
2000), managing human resources (Bates et al., 1995; Youndt et al., 1996) and supply
chain management (Narasimhan and Das, 1999; Rosenzweig et al., 2003). Work within
the resource-based strategy paradigm (RBV) may further support this argument. Ray
et al. (2004) suggest that top-level measures (e.g. financial performance) may lead to
“misleading conclusions with regard to resource-based theory”; instead, they suggest
that future RBV studies should use dependent variables formulated at the business
process level, defined as the activities or capabilities that underpin the delivery of a
strategy. At the plant-level, operational priorities are more relevant than financial goals
(Venkatraman and Ramanujam, 1986).
Further, although manufacturing strategy research often uses a one-dimensional
performance measure such as a composite index of manufacturing performance or
competence or an aggregate financial or market measure, a multi-dimensional measure
is more appropriate for studying practice-performance relationships (Ketokivi and
Schroeder, 2004a; see also Bozarth and Edwards, 1997; Flynn et al., 1999). An attribute
of this research design is the use of measures focused on commonly reported objective
measures of process performance, rather than perceptual measures. Ketokivi and
Schroeder (2004b) suggested that perceptual measures of operations performance are
subject to common methods bias and low internal consistency. There is no single set of
agreed measures to identify world-class manufacturing plants. Consequently, after
undertaking an exhaustive literature search, we selected seven of the most common
objective measures found within this literature base (Hayes and Wheelwright, 1984;
Schonberger, 1986; Womack et al., 1990b; New, 1992; Flynn et al., 1999; Oliver et al.,
1996a; Brown, 2000).
The implementation of quality practices has been linked to quality performance
(Sakakibara et al., 1997; Samson and Terziovski, 1999). There are multiple dimensions
of quality. Conformance quality describes how consistently a product meets design
specifications (Flynn et al., 1999). Conformance quality was measured in this study as
the percentage of failures at final inspection. Because lower defect rates will lead to
lower costs of service and warranty (Maani and Sluti, 1990), there is a relationship
between conformance quality and business performance. The three measures of
quality-related performance collected in the field research were:
(1) Conformance quality as the percentage of failures at final inspection (WC1).
(2) Percentage of manufacturing employees involved in quality control (QC) or
continuous improvement (CI) activities (WC2).
(3) Annual number of suggestions per employee (WC3).
A number of studies have examined the links between just-in-time manufacturing and Contribution of
its infrastructure and manufacturing performance (Sakakibara et al., 1997). A key manufacturing
revelation of just-in-time for Western manufacturers was the radical reduction in
inventory levels, which was not being achieved or even intended by conventional strategy
inventory management systems such as MRP. Strategic and operational co-operation
between buyers and suppliers, often involving collaborative planning and facilitated
by information systems, has been argued to be a source of competitive advantage 289
(Petersen et al., 2005). Firms are involved in networks of interconnected interfirm
relationships, and hence embedded in networks that affect their product and process
performance (Echols and Tsai, 2005).
Three measures of lean-related performance collected in the field research were:
(1) Class A inventory WIP levels (h) (WC4). We analysed levels of “Class A”
inventory across all plants. Class A inventory are strategically significant not
only in terms of costs (in the region of 70-80 per cent) but also because they
require highly developed supplier relationships in order to satisfy a range of
competitive factors including quality, and delivery.
(2) Finished goods inventory (h) (WC5).
(3) Percentage of class A suppliers having contracts lasting over three years
(per cent) (WC6).

Finally, innovation, the ability to develop and introduce new products successfully, is a
key characteristic of world-class firms. The measure of innovation-related performance
collected in the field research was:
.
Innovation time of new product development (NPD) (months) (WC7). We
measured innovation lead times across all plants, measuring the gap between
completion of new designs and actual product launches.

Strategic alignment measurement

Data were collected on ten measures of manufacturing strategy process and
manufacturing strategy content. One item related to the involvement of manufacturing
executives, three items related to the alignment of process issues and six items related
to the alignment of content issues.
As noted in the Introduction, strategic planning often fails when confined to top
management and planning experts and functional or departmental managers are
excluded (Mintzberg, 1994). Furthermore, involving middle managers in strategic
planning makes them aware of the organisation’s goals (Wooldridge and Floyd, 1990),
as well as the broader context of the firm’s strategy (Ketokivi and Castaner, 2004).
Top management can then communicate and articulate the priorities that have been
decided in the planning process, so that the entire organization can take them into
account. Further, operations managers are more likely to be interested in the outcome
of strategic planning when they have participated (Ketokivi and Castaner, 2004).
In order to ascertain the degree to which operations managers were involved in the
strategic planning process and the level of communication, we asked the respondents
to indicate their level of agreement on the following graded-response Likert-type single
items (1 ¼ strongly disagree to 5 ¼ strongly agree):
IJOPM .
Participation. Senior-level manufacturing personnel are actively involved in the
27,3 business strategy planning process and not employed purely as technical
specialists in manufacturing (Process 1).
.
Communication of priorities. There are explicit, plant-specific, strategies in place
(Process 2).
.
Communication of priorities. These strategies feed into, and form part of,
290 business strategy (Process 3).
.
Communication of priorities. There is cohesion in content and timing between
business strategy and manufacturing strategies (Process 4).

The involvement of operations managers in the strategic planning process also

ensures that strategic operations issues are accounted for in the strategic planning
process. These issues are contingent on factors such as industry and size, and also
change over time. Current issues include supply chain management, process
technology, capacity, product mix, facilities, and NPD. Hence, as a way of gauging the
degree to which operations issues had been accounted for in the strategic plan, we
asked the respondents to indicate their level of involvement on the following six
graded-response Likert-type single items (1 ¼ no involvement to 5 ¼ strong
involvement).

(1) Supply chain. Strategic decision-making in the nature and shape of the supply
chain – involving the degree of vertical integration as well as buyer-supplier
relations for the plant (Content 1).
(2) Process technology. Strategic process technology investment issues. This
included the degree of, and rationale behind, investment in new process
technology for plants (Content 2).
(3) Capacity. Strategic capacity decisions within the existing plants. This included
involvement in decisions on adding to, or downsizing, or even divesting entire
plants (Content 3).
(4) Product mix. Determining levels of production of existing products and models
of the plant’s current product portfolio (Content 4).
(5) Facilities. Strategic growth initiatives including new facilities/location decisions
(Content 5).
(6) NPD. Strategic NPD in both existing and new markets (Content 6).

Results and analysis

The descriptive statistics for the manufacturing strategy data collected from the 16
participating companies are shown in Table I.
We divided the respondents into two groups, high performers and low performers,
based on their responses on the seven performance measures described above. Because
the differences were so stark, no statistical method was needed to make this division;
however, cluster analysis (Ward’s minimum variance cluster method) was conducted
to confirm that it had been correctly carried out (results available on request). No
differences were found between the two analyses techniques.
 Average SD 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

Process 1 3.313 1.662 1.000

Process 2 3.500 1.549 0.893 1.000
Process 3 3.125 1.857 0.807 0.927 1.000
Process 4 3.375 1.500 0.752 0.861 0.891 1.000
Content 1 3.813 1.328 0.814 0.924 0.956 0.875 1.000
Content 2 3.375 1.455 0.831 0.887 0.944 0.848 0.936 1.000
Content 3 3.500 1.461 0.810 0.943 0.885 0.852 0.877 0.878 1.000
Content 4 3.500 1.506 0.733 0.829 0.834 0.827 0.817 0.761 0.728 1.000
Content 5 3.750 1.612 0.777 0.881 0.879 0.923 0.817 0.838 0.821 0.879 1.000
Content 6 3.625 1.455 0.631 0.799 0.808 0.863 0.721 0.732 0.753 0.639 0.838 1.000
WC1 2.903 1.880 -0.924 -0.922 -0.917 -0.858 -0.894 -0.904 -0.769 -0.924 -0.902 0.967 1.000
WC2 53.125 38.853 0.892 0.909 0.894 0.930 0.910 0.846 0.792 0.843 0.806 -0.944 -0.879 1.000
WC3 16.000 7.421 0.887 0.885 0.886 0.873 0.852 0.812 0.764 0.836 0.877 -0.929 -0.915 0.931 1.000
WC4 19.563 13.928 2 0.904 2 0.907 2 0.770 2 0.870 20.870 20.841 20.739 20.816 20.696 0.925 0.899 2 0.804 2 0.842 1.000
WC5 16.313 11.847 2 0.910 2 0.871 2 0.851 2 0.848 20.854 20.849 20.723 20.872 20.793 0.921 0.932 2 0.818 2 0.842 0.898 1.000
WC6 63.750 32.378 0.937 0.923 0.861 0.917 0.888 0.888 0.800 0.894 0.732 20.949 20.919 0.850 0.839 2 0.941 2 0.900 1.000
WC7 27.500 7.711 2 0.826 2 0.852 2 0.824 2 0.869 20.885 20.840 20.861 20.836 20.588 0.869 0.814 2 0.831 2 0.769 0.816 0.778 2 0.844 1.000
strategy
manufacturing

Descriptive statistics
291

Table I.
Contribution of
IJOPM Nine of the 16 plants were identified as “world-class plants” demonstrating higher
27,3 levels of performance across the seven performance measures than the remaining
seven plants. More specifically it was found that world-class plants:
.
Paid more attention to quality issues (percentage of failures at final inspection,
involvement in QC and CI, and suggestions per employee); although neither
group was near to the ideal of “zero defects” the two groups differed significantly
292 in terms of the number of employees in QC and CI activities, the annual number
of suggestions per employee and the percentage of failures at final inspection.
.
Carried less inventory in terms of both WIP and finished goods inventories, which
was telling in the range of “Class A” components’ work-in process, with world-class
plants carrying 3-18 h and non-world-class plants carrying 24-40 h. Finished goods
inventory similarly ranged between 3 and 12 h and between 24 and 36 h.
.
Had a larger percentage of suppliers with long-term contracts than strategic
dissonant plants. On average 90 per cent of the class A suppliers of world-class
plants enjoyed contracts of longer than three years, compared to just 30 per cent
of non-world-class plant suppliers.
.
Reported faster NPD cycles than traditional plants, on average NPD time was
approximately a third less in world-class plants.

The three hypotheses were tested using one-way analyses of variance. Table II
indicates significant differences between high performers and low performers across
all ten measures.

Hypothesis 1
H1 predicted that senior manufacturing personnel would be more actively involved in
business strategy in world-class than other plants. To test this hypothesis, the analysis
examined differences between the two groups for the first measure of strategic
alignment (Process 1). The results support H1; senior manufacturing personnel are
more actively involved in business strategy in world-class than non-world-class plants
ðF ¼ 46:11; p , 0:001Þ:

Hypothesis 2
H2 predicted that plant-level strategies are more likely to be stated and to form part of
business strategy in world-class than non-world-class plants. To test this hypothesis,
the analysis examined differences between the two groups for the second (Process 2),
third (Process 3), and fourth (Process 4) measures of strategic alignment. The results
support H2; world-class plants are more likely to have explicit, plant-specific,
strategies in place than non-world-class plants (F ¼ 194.90, p , 0.001); these strategies
more often feed into, and form part of, business strategy in world-class than
non-world-class plants (F ¼ 239.58, p , 0.001); and there is greater cohesion in content
and timing between business strategy and manufacturing strategies in world-class
than non-world-class plants (F ¼ 79.02, p , 0.001).

Hypothesis 3
H3 predicted that strategic decision content areas are more likely to be included in
business strategy in world-class than non-world-class plants. To test this hypothesis,
 Contribution of
World-Class
Plants Non-World-Class Plants manufacturing
(n ¼ 9) (n ¼ 7) strategy
Factor Mean SD Mean SD F

Active involvement in strategy (H1) 4.56 1.01 1.71 0.49 46.11 * * *

Explicit plant specific strategies (H2) 4.78 0.44 1.86 0.38 194.90 * * * 293
Integration into business strategy (H2) 4.67 0.50 1.14 0.38 239.58 * * *
Cohesion in content and timing (H2) 4.56 0.53 1.86 0.69 79.02 * * *
Active involvement in supply chain (H3) 4.89 0.33 2.43 0.53 128.18 * * *
Active involvement in technology investment (H3) 4.56 0.53 1.86 0.38 130.35 * * *
Active involvement in capacity decisions (H3) 4.67 0.50 2.00 0.58 98.00 * * * Table II.
Active involvement in production levels (H3) 4.56 0.53 2.14 1.22 28.96 * * * Differences in the process
Active involvement in growth initiatives (H3) 5.00 0.00 2.14 1.07 65.63 * * * and content of operations
Active involvement in NPD (H3) 4.67 0.50 2.29 1.11 33.14 * * * strategy in world-class
and non-world-class
Note: * * *p , 0.001 plants

the analysis examined the differences between the two groups for the six content
measures of strategic alignment (Contents 1-6). The results all support H3; world-class
plants are more likely to involve manufacturing in the six content areas supply chain
(F ¼ 128.18, p , 0.001); technology investment (F ¼ 130.35, p , 0.001); capacity
decisions (F ¼ 98.00, p , 0.001); production levels (F ¼ 28.96, p , 0.001); growth
initiatives (F ¼ 65.63, p , 0.001); and NPD (F ¼ 33.14, p , 0.001).

Discussion
The statistical analysis of the empirical data presented above strongly supports this
paper’s contention that strategic alignment between the strategy process and strategy
content is as fundamental to manufacturing performance as the strategy content in
terms of resources and capabilities. In high-performing plants, manufacturing
managers were centrally involved in the strategy process, and manufacturing
strategies were in place and aligned with business strategy in both content and timing.
This was not true of the low performing plants. Also in these plants, the product
portfolio, process technology, capacity, expansion, NPD, and supply chain were all part
of strategic decision-making.
Further, the data show that the high-performing plants outperformed the
low-performing plants across all of the seven indicators of world-class manufacturing.
This sheds further light on the capabilities tradeoffs versus cumulative capabilities
debate.
The role and importance of the manufacturing strategy was, perhaps, the most
sharply contrasted area between world-class and non-world-class plants in our survey.
In world-class plants, the role of manufacturing strategy helped to cascade the
business strategy down into a range of plant-specific, action plans. Essentially,
manufacturing strategy in world-class plants formed the important bridge that linked
together business strategy and operational capabilities. In the world-class plants
manufacturing strategy was clearly linked to the business plan, coherent with the
business plan in time, and included “business” areas such as the extent of vertical
integration, sourcing and developing supplier relationships, NPD, and involvement in
IJOPM selecting partners in alliances. In the non-world-class plants, an explicit manufacturing
27,3 strategy either did not exist at all or, where it did exist, it was focused on technical
aspects of the operations task and was not involved in wider, business areas.
The role and position of senior-level manufacturing/operations personnel provided
further insights. First, although all of the world-class plants had senior manufacturing
personnel in place, such senior-level presence was evident in three of the non-world-class
294 plants. Thus, we must conclude that having senior manufacturing/operations personnel
in place may be necessary, but is not sufficient, to distinguish WC from non-WC plants.
Thus, in spite of the case that has been made, since Skinner’s (1969) seminal work,
for senior-level manufacturing personnel to be in place in order for manufacturing
strategy to be relevant, we suggest that such level of seniority within the hierarchy of
the firm does not by itself explain the differences of both the role and contribution that
manufacturing personnel might have within a plant. However, the actual nature of the
role and scope of responsibility in addition to levels of seniority that manufacturing
managers may have does distinguish world-class from non-world-class plants. In
short, senior manufacturing personnel within the non-world-class plants saw their role
essentiality as one of a “technical specialist”. Their contributions to wider business
aspects of the firm were very limited. World-class manufacturing managers/directors,
by contrast, saw their role as much wider than mere technical support and they were
involved in, and central to, wider business issues of the plant. In WC plants,
senior-level operations personnel were responsible for translating planned strategic
aims into operational capabilities.
Consistent with prior research (Brown, 2001; Brown and Cousins, 2004) we found
evidence of two plants – one non-world-class, the other world-class – within the same
company. Thus, in large firms, the notion of firm-specific capabilities needs to be seen,
rather, in terms of divisional or plant-specific capabilities. Again the role, rather than
seniority of manufacturing personnel was telling here: in the non-WC plants, the role of
the senior manufacturing manager was limited to that of a technical specialist; in the
WC plants, much more contact and dialogue took place between the senior
manufacturing manager and the parent company on a range of wider business issues
relating to the plant.
In terms of capabilities, from the data we propose that the abilities of the world-class
plants are cumulative (Ferdows and De Meyer, 1990; Flynn and Flynn, 2004).
World-class plants, having learned expertise in one area of operations then utilise this
as part of the overall manufacturing capabilities within a particular plant. This
approach also agrees with recent research by Flynn and Flynn (2004). Second,
world-class plants achieve performance across both quality and lean performance
simultaneously – there was no notion of trade-offs of capabilities within world-class
plants: all of the world-class plants scored better than their non-world-class rivals in all
areas. Once these abilities have been accumulated in the first place they become part of
a set of simultaneous capabilities. World-class plants simultaneously displayed
superior performance in terms of quality, inventory, supplier management and
innovation.

Conclusions
It has been suggested that an appropriate research question is “What practices are used
by the best performing organisations?” (Davies and Kochhar, 2002; Laugen et al., 2005).
In investigating the practice-performance relationship, the preponderance of Contribution of
manufacturing strategy studies have focused on the relationship between manufacturing
manufacturing practices associated with the execution of manufacturing strategy
(strategy content) and manufacturing performance (Laugen et al., 2005) but have strategy
neglected the relationship between practices associated with the manufacturing
strategy (strategy process) and manufacturing performance.
By linking strategic alignment and the manufacturing strategy process to 295
world-class manufacturing practices and performance, this research adds a new
dimension to the study of world-class manufacturing and more generally to the best
practices and practice-performance debates. Even though many best practices have
been identified since Hayes and Wheelwright’s (1984) original research (Flynn et al.,
1999; Laugen et al., 2005), and the best practices agenda has moved on from specific
practices to “bundles” of practices that have come to be known as “world-class
manufacturing” (Schonberger, 1986), there has been relatively little on the strategy
process and much more emphasis on strategy content. Researchers have focused on the
relationship between, for example, quality management practices and quality
performance (Davies and Kochhar, 2002; Flynn et al., 1994), and not on the process by
which performance on a specific dimension becomes part of the manufacturing and
business strategic agenda. However, if best practices are defined as “the practices used
by, and having a significant effect on the performance of, the best-performing
companies” (Laugen et al., 2005) then the practices associated with formulating and
implementing manufacturing strategy should be included in best practices.
A second contribution is that the sample selected in this research complements
rather than replicates previous manufacturing strategy studies. Many of the previous
findings linking practices and performance have been derived from large-scale surveys
across countries and industries (Forza, 2002) such as Made in Britain (Hanson and
Voss, 1993; Voss et al., 2004), the International manufacturing strategy survey,
World-class manufacturing study, or Manufacturing futures study (Corbett and
Claridge, 2002). By limiting the sample to the computer industry in a single country,
this research eliminates many sources of external heterogeneity present in studies at
the company level, plant-level (Schroeder et al., 1995), or the manufacturing cell
(Harrison, 1998). This helps keep types of industry, company size, processes, and
products constant for the participants in this study, which addresses a major criticism
of best practices as being too generic (Harrison, 1998; Laugen et al., 2005). Further, this
has enabled the use of measures rather than subjective indices (Ferdows and De Meyer,
1990; Flynn et al., 1999) or constructed scales (Noble, 1995).

Limitations and prospects for future research

One limitation of this research is that it emphasises the correlation between strategic
alignment and performance rather than supporting investigation into cause-effect
relationships. This could be rectified by further longitudinal analysis of this and other
data sets.
A second limitation is the small sample size, which prevents robust statistical
analysis. A third issue is that we have examined only one industry and, as always, the
question of transferability will emerge. However, although every setting is
industry-specific, we believe insights will be offered to other, high volume,
industries that are also undergoing fundamental changes from mass production due
IJOPM to greater levels of competition and higher customer demands. We have explored only
27,3 a few parameters within operations capabilities, which limits the scope of the research.
Future research could examine other performance areas such as flexibility, delivery,
cost, customisation or variety. Some of the measures used to examine the four
capabilities could be expanded. For example, supplier management measures could
examine the nature of the relationship as well as the duration. Constructs such as trust
296 and asset specificity may provide additional insights. We encourage further research to
explore some of these limitations in order to offer further insights.

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Corresponding author
Steve Brown can be contacted at: Steve.Brown@exeter.ac.uk

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