Institutions, resources, and entry strategies in emerging economies

We investigate the impact of market-supporting institutions on business strategies by analyzing the entry strategies of foreign investors entering emerging economies. We apply and advance the institution-based view of strategy by integrating it with resource-based considerations. In particular, we show how resource-seeking strategies are pursued using different entry modes in different institutional contexts. Alternative modes of entry—greenfield, acquisition, and joint venture (JV)—allow firms to overcome different kinds of market inefficiencies related to both characteristics of the resources and to the institutional context. In a weaker institutional framework, JVs are used to access many resources, but in a stronger institutional framework, JVs become less important while acquisitions can play a more important role in accessing resources that are intangible and organizationally embedded. Combining survey and archival data from four emerging economies, India, Vietnam, South Africa, and Egypt, we provide empirical support for our hypotheses.

Founders' human capital and the performance of UK new technology based firms

This paper investigates the role of entrepreneurs' general and specific human capital on the performance of UK new technology based firms using a resource based approach to the entrepreneurship theory. The effect of entrepreneurial human capital on the performance of NTBFs is investigated using data derived from a survey of 412 firms operating in both high-tech manufacturing and the services sectors. According to the resource based theory it is found that specific human capital is more important for the performance of NTBFs in relation to general. More specifically individual entrepreneurs or entrepreneurial teams with high levels of formal business education, commercial, managerial or same sector experience are found to have created better performing NTBFs. Finally it is found that the performance of a NTBF can improve through the combination of heterogeneous but complementary skills, including, for example, technical education and commercial experience or managerial technical and managerial commercial experience. © 2010 Springer Science+Business Media, LLC.

The future of manufacturing

Anyone who looks at the title of this special issue will agree that the intent behind the preparation of this volume was ambitious: to predict and discuss “The Future of Manufacturing”. Will manufacturing be important in the future? Even though some sceptics might say not, and put on the table some old familiar arguments, we would strongly disagree. To bring subsidies for the argument we issued the call-for-papers for this special issue of Journal of Manufacturing Technology Management, fully aware of the size of the challenge in our hands. But we strongly believed that the enterprise would be worthwhile. The point of departure is the ongoing debate concerning the meaning and content of manufacturing. The easily visualised internal activity of using tangible resources to make physical products in factories is no longer a viable way to characterise manufacturing. It is now a more loosely defined concept concerning the organisation and management of open, interdependent, systems for delivering goods and services, tangible and intangible, to diverse types of markets. Interestingly, Wickham Skinner is the most cited author in this special issue of JMTM. He provides the departure point of several articles because his vision and insights have guided and inspired researchers in production and operations management from the late 1960s until today. However, the picture that we draw after looking at the contributions in this special issue is intrinsically distinct, much more dynamic, and complex. Seven articles address the following research themes: 1.new patterns of organisation, where the boundaries of firms become blurred and the role of the firm in the production system as well as that of manufacturing within the firm become contingent; 2.new approaches to strategic decision-making in markets characterised by turbulence and weak signals at the customer interface; 3.new challenges in strategic and operational decisions due to changes in the profile of the workforce; 4.new global players, especially China, modifying the manufacturing landscape; and 5.new techniques, methods and tools that are being made feasible through progress in new technological domains. Of course, many other important dimensions could be studied, but these themes are representative of current changes and future challenges. Three articles look at the first theme: organisational evolution of production and operations in firms and networks. Karlsson's and Skold's article represent one further step in their efforts to characterise “the extraprise”. In the article, they advance the construction of a new framework, based on “the network perspective” by defining the formal elements which compose it and exploring the meaning of different types of relationships. The way in which “actors, resources and activities” are conceptualised extends the existing boundaries of analytical thinking in operations management and open new avenues for research, teaching and practice. The higher level of abstraction, an intrinsic feature of the framework, is associated to the increasing degree of complexity that characterises decisions related to strategy and implementation in the manufacturing and operations area, a feature that is expected to become more and more pervasive as time proceeds. Riis, Johansen, Englyst and Sorensen have also based their article on their previous work, which in this case is on “the interactive firm”. They advance new propositions on strategic roles of manufacturing and discuss why the configuration of strategic manufacturing roles, at the level of the network, will become a key issue and how the indirect strategic roles of manufacturing will become increasingly important. Additionally, by considering that value chains will become value webs, they predict that shifts in strategic manufacturing roles will look like a sequence of moves similar to a game of chess. Then, lastly under the first theme, Fleury and Fleury develop a conceptual framework for the study of production systems in general derived from field research in the telecommunications industry, here considered a prototype of the coming information society and knowledge economy. They propose a new typology of firms which, on certain dimensions, complements the propositions found in the other two articles. Their telecoms-based framework (TbF) comprises six types of companies characterised by distinct profiles of organisational competences, which interact according to specific patterns of relationships, thus creating distinct configurations of production networks. The second theme is addressed by Kyläheiko and SandstroÍm in their article “Strategic options based framework for management of dynamic capabilities in manufacturing firms”. They propose a new approach to strategic decision-making in markets characterised by turbulence and weak signals at the customer interface. Their framework for a manufacturing firm in the digital age leads to active asset selection (strategic investments in both tangible and intangible assets) and efficient orchestrating of the global value net in “thin” intangible asset markets. The framework consists of five steps based on Porter's five-forces model, the resources-based view, complemented by means of the concepts of strategic options and related flexibility issues. Thun, GroÍssler and Miczka's contribution to the third theme brings the human dimension to the debate regarding the future of manufacturing. Their article focuses on the challenges brought to management by the ageing of workers in Germany but, in the arguments that are raised, the future challenges associated to workers and work organisation in every production system become visible and relevant. An interesting point in the approach adopted by the authors is that not only the factual problems and solutions are taken into account but the perception of the managers is brought into the picture. China cannot be absent in the discussion of the future of manufacturing. Therefore, within the fourth theme, Vaidya, Bennett and Liu provide the evidence of the gradual improvement of Chinese companies in the medium and high-tech sectors, by using the revealed comparative advantage (RCA) analysis. The Chinese evolution is shown to be based on capabilities developed through combining international technology transfer and indigenous learning. The main implication for the Western companies is the need to take account of the accelerated rhythm of capability development in China. For other developing countries China's case provides lessons of great importance. Finally, under the fifth theme, Kuehnle's article: “Post mass production paradigm (PMPP) trajectories” provides a futuristic scenario of what is already around us and might become prevalent in the future. It takes a very intensive look at a whole set of dimensions that are affecting manufacturing now, and will influence manufacturing in the future, ranging from the application of ICT to the need for social transparency. In summary, this special issue of JMTM presents a brief, but undisputable, demonstration of the possible richness of manufacturing in the future. Indeed, we could even say that manufacturing has no future if we only stick to the past perspectives. Embracing the new is not easy. The new configurations of production systems, the distributed and complementary roles to be performed by distinct types of companies in diversified networked structures, leveraged by the new emergent technologies and associated the new challenges for managing people, are all themes that are carriers of the future. The Guest Editors of this special issue on the future of manufacturing are strongly convinced that their undertaking has been worthwhile.

The growing importance of inter-company collaboration

Guest editorial: This special issue has been drawn from papers that were published as part of the Second European Conference on Management of Technology (EuroMOT) which was held at Aston Business School (Birmingham, UK) 10-12 September 2006. This was the official European conference for the International Association for Management of Technology (IAMOT); the overall theme of the conference was “Technology and global integration.” There were many high-calibre papers submitted to the conference and published in the associated proceedings (Bennett et al., 2006). The streams of interest that emerged from these submissions were the importance of: technology strategy, innovation, process technologies, managing change, national policies and systems, research and development, supply chain technology, service and operational technology, education and training, small company incubation, technology transfer, virtual operations, technology in developing countries, partnership and alliance, and financing and investment. This special issue focuses upon the streams of interest that accentuate the importance of collaboration between different organisations. Such organisations vary greatly in character; for instance, they may be large or small, publicly or privately owned, and operate in manufacturing or service sectors. Despite these varying characteristics they all have something in common; they all stress the importance of inter-organisational collaboration as a critical success factor for their organisation. In today's global economy it is essential that organisations decide what their core competencies are what those of complementing organisations are. Core competences should be developed to become a bases of differentiation, leverage and competitive advantage, whilst those that are less mature should be outsourced to other organisations that can claim to have had more recognition and success in that particular core competence (Porter, 2001). This strategic trend can be observed throughout advanced economies and is growing strongly. If a posteriori reasoning is applied here it follows that organisations could continue to become more specialised in fewer areas whilst simultaneously becoming more dependent upon other organisations for critical parts of their operations. Such actions seem to fly in the face of rational business strategy and so the question must be asked: why are organisations developing this way? The answer could lie in the recent changes in endogenous and exogenous factors of the organisation; the former emphasising resource-based issues in the short-term, and strategic positioning in the long-term whilst the later emphasises transaction costs in the short-term and acquisition of new skills and knowledge in the long-term. For a harmonious balance of these forces to prevail requires organisations to firstly declare a shared meta-strategy, then to put some cross-organisational processes into place which have their routine operations automated as far as possible. A rolling business plan would review, assess and reposition each organisation within this meta-strategy according to how well they have contributed (Binder and Clegg, 2006). The important common issue here is that an increasing number of businesses today are gaining direct benefit from increasing their levels of inter-organisational collaboration. Such collaboration has largely been possible due to recent technological advances which can make organisational structures more agile (e.g. the extended or the virtual enterprise), organisational infra-structure more connected, and the sharing of real-time information an operational reality. This special issue consists of research papers that have explored the above phenomenon in some way. For instance, the role of government intervention, the use of internet-based technologies, the role of research and development organisations, the changing relationships between start-ups and established firms, the importance of cross-company communities of practice, the practice of networking, the front-loading of large-scale projects, innovation and the probabilistic uncertainties that organisations experience are explored in these papers. The cases cited in these papers are limited as they have a Eurocentric focus. However, it is hoped that readers of this special issue will gain a valuable insight into the increasing importance of collaborative practices via these studies.

Capabilities for strategic flexibility:a cognitive content framework

Different forms of strategic flexibility allow for reactive adaptation to different changing environments and the proactive driving of change. It is therefore becoming increasingly important for decision makers to not only possess marketing capabilities, but also the capabilities for strategic flexibility in its various forms. However, our knowledge of the relationships between decision makers’ different ways of thinking and their capabilities for strategic flexibility is limited. This limitation is constraining research and understanding. In this article we develop a theoretical cognitive content framework that postulates relationships between different ways of thinking about strategy and different information-processing demands. We then outline how the contrasting beliefs of decision makers may influence their capabilities to generate different hybrid forms of strategic flexibility at the cognitive level. Theoretically, the framework is embedded in resource-based theory, personal construct theory and schema theory. The implications for research and theory are discussed.

On the opportunism-independent theory of the firm

Previous developments in the opportunism-independent theory of the firm are either restricted to special cases or are derived from the capabilities or resource-based perspective. However, a more general opportunism-independent approach can be developed, based on the work of Demsetz and Coase, which is nevertheless contractual in nature. This depends on 'direction', that is, deriving economic value by permitting one set of actors to direct the activities of another, and of non-human factors of production. Direction helps to explain not only firm boundaries and organisation, but also the existence of firms, without appealing to opportunism or moral hazard. The paper also considers the extent to which it is meaningful to speak of 'contractual' theories in the absence of opportunism, and whether this analysis can be extended beyond the employment contract to encompass ownership of assets by the firm. © The Author 2005. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.

Economists' perceptions versus managers' decisions:an experiment in transaction cost analysis

Are the perceptions of professional economists on transaction costs consistent with make-or-buy decisions made within firms? The answer may have important implications for transaction cost research. Data on firms' outsourcing during the new product development process are taken from a largescale survey of UK, German and Irish manufacturing plants, and we test the consistency of these outsourcing decisions with the predictions derived from the transaction cost perceptions of a panel of economists. Little consistency is evident between actual outsourcing patterns and the predictions of the (Williamsonian) transactions cost model derived from the panel of economists. There is, however, evidence of a systematic pattern to the differences, suggesting that a competence or resource-based approach may be relevant to understanding firm outsourcing, and that firms are adopting a strategic approach to managing their external relationships. © Cambridge Political Economy Society 2005; all rights reserved.

Transferring knowledge of manufacturing techniques within a subsidiary of a multi-national corporation

With the growth of the multi-national corporation (MNCs) has come the need to understand how parent companies transfer knowledge to, and manage the operations of, their subsidiaries. This is of particular interest to manufacturing companies transferring their operations overseas. Japanese companies in particular have been pioneering in the development of techniques such as Kaizen, and elements of the Toyota Production System (TPS) such as Kanban, which can be useful tools for transferring the ethos of Japanese manufacturing and maintaining quality and control in overseas subsidiaries. Much has been written about the process of transferring Japanese manufacturing techniques but much less is understood about how the subsidiaries themselves – which are required to make use of such techniques – actually acquire and incorporate them into their operations. This research therefore takes the perspective of the subsidiary in examining how knowledge of manufacturing techniques is transferred from the parent company within its surrounding (subsidiary). There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate this knowledge into their working practices. A particularly relevant theme is how subsidiaries both replicate and adapt knowledge from parents and the circumstances in which replication or adaptation occurs. However, it is shown that there is a lack of research which takes an in-depth look at these processes from the perspective of the participants themselves. This is particularly important as much knowledge literature argues that knowledge is best viewed as enacted and learned in practice – and therefore transferred in person – rather than by the transfer of abstract and de-contextualised information. What is needed, therefore, is further research which makes an in-depth examination of what happens at the subsidiary level for this transfer process to occur. There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate knowledge about manufacturing techniques into their working practices. In depth qualitative research was, therefore, conducted in the subsidiary of a Japanese multinational, Gambatte Corporation, involving three main manufacturing initiatives (or philosophies), namely 'TPS‘, 'TPM‘ and 'TS‘. The case data were derived from 52 in-depth interviews with project members, moderate-participant observations, and documentations and presented and analysed in episodes format. This study contributes to our understanding of knowledge transfer in relation to the approaches and circumstances of adaptation and replication of knowledge within the subsidiary, how the whole process is developed, and also how 'innovation‘ takes place. This study further understood that the process of knowledge transfer could be explained as a process of Reciprocal Provider-Learner Exchange that can be linked to the Experiential Learning Theory.

HRM, organizational capacity for change, and performance:a global perspective

This special issue brings together a variety of articles, each one enriching understanding about whether and how human resource management (HRM) influences organizational performance (however defined) against a backdrop of complex change. We present a preliminary framework that enables us to integrate the diverse themes explored in the special issue, proposing a mediating role for organizational change capacity (OCC). OCC represents a particular subset within the resource-based literature labeled as “dynamic capabilities.” Although not well researched, there is evidence that OCC is positively associated with firm performance and that this relationship is stronger given conditions of high uncertainty. Our framework reflects on external and internal parameters, which we suggest moderate the relationship between human resource management (HRM), OCC, and organizational performance. Our intention is to provide compelling insight for both practitioners and researchers, especially those whose remit extends beyond national boundaries, with reference to areas of the globe as disparate as Greece, Ireland, Pakistan, Switzerland, and the United Kingdom. © 2012 Wiley Periodicals, Inc.

Strategies for sustaining manufacturing competitiveness:case studies of Australian firms

This study investigates the strategies adopted by Australian manufacturing firms to sustain their local production and competitiveness, including during the period of the recent global financial crisis. Six Australian manufacturing organisations in different sectors were selected and analysed using the market-based and resource-based views, and components of the DRAMA framework. The findings highlight several factors and company efforts to sustain manufacturing operations. These organisations pursued a range of manufacturing strategies to enable distinctive offerings in the marketplace and used various ways to differentiate themselves. This was possible through the portfolio of capabilities that determine their continued production and business performance over the period. This study provides important lessons for managers in manufacturing organisations and demonstrates how differing capabilities and strategies of firms can impact the competitiveness of local production, not only in times of economic crisis but also in the long run to sustainable competitiveness in the future.

The usability of semantic search tools:a review

The goal of semantic search is to improve on traditional search methods by exploiting the semantic metadata. In this paper, we argue that supporting iterative and exploratory search modes is important to the usability of all search systems. We also identify the types of semantic queries the users need to make, the issues concerning the search environment and the problems that are intrinsic to semantic search in particular. We then review the four modes of user interaction in existing semantic search systems, namely keyword-based, form-based, view-based and natural language-based systems. Future development should focus on multimodal search systems, which exploit the advantages of more than one mode of interaction, and on developing the search systems that can search heterogeneous semantic metadata on the open semantic Web.

Transferring knowledge of manufacturing techniques in multinational corporations:preliminary findings

With the growth of the multinational corporation (MNC) has come the need to understand how parent companies transfer knowledge to, and manage the operations of, their subsidiaries. This is of particular interest to manufacturing companies transferring their operations overseas. Japanese companies in particular have been pioneering in this regard, with techniques such as the Toyota Production System (TPS) for transferring the ethos of Japanese manufacturing and maintaining quality and control in overseas subsidiaries. A great deal has been written about the process of transferring Japanese manufacturing techniques, but much less is understood about how the subsidiaries themselves, which are required to make use of such techniques, actually acquire and incorporate them into their operations. The research on which this paper is based therefore examines how, from the perspective of the subsidiary, knowledge of manufacturing techniques is transferred from the parent company. There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate knowledge about manufacturing techniques into their working practices. In-depth qualitative research was, therefore, conducted in the subsidiary of a Japanese multinational, Denso Corporation, involving three main manufacturing initiatives (or philosophies), namely ‘TPS’, ‘TPM’ and ‘TS’. The case data were derived from 52 in-depth interviews with project members, moderate participant observations, and documentations. The aim of this paper is to present the preliminary findings from the case analyses. The research contributes to our understanding of knowledge transfer in relation to the circumstances of the selection between adaptation and replication of knowledge in the subsidiary from its parent. In particular this understanding relates to transfer across different flows and levels in the organisational hierarchy, how the whole process is managed, and also how modification takes place.

Linking risk management to strategic controls:a case study of Tesco plc

Definitions and perceptions of the role and styles of risk management, and performance management/strategic control systems have evolved over time, but it can be argued that risk management is primarily concerned with ensuring the achievement of strategic objectives. This paper shows the extent of overlap between a broad-based view of risk management, namely Enterprise Risk Management (ERM), and the balanced scorecard, which is a widely used strategic control system. A case study of one of the UK's largest retailers, Tesco plc, is used to show how ERM can be introduced as part of an existing strategic control system. The case demonstrates that, despite some differences in lines of communications, the strategic controls and risk controls can be used to achieve a common objective. Adoption of such an integrated approach, however, has implications for the profile of risk and the overall risk culture within an organisation.

Nonprofits and business:toward a subfield of nonprofit studies

Although the field of nonprofit studies now encompasses a substantial body of literature on the relationship between governmental and nonprofit organizations, the relationship between the business and nonprofit sectors has been less addressed by specialist nonprofit scholars. This Research Note aims to encourage further studies by nonprofit scholars of the business-nonprofit sector relationship. It looks at descriptive evidence to date, proposes a tentative resource-based framework for understanding how nonprofits and business relate to each other in practice and suggests some initial directions for developing a subfield within nonprofit studies. © The Author(s) 2012.

Building theory at the intersection of ecological sustainability and strategic management

This article builds theory at the intersection of ecological sustainability and strategic management literature—specifically, in relation to dynamic capabilities literature. By combining industrial organization economics–based, resource-based, and dynamic capability–based views, it is possible to develop a better understanding of the strategies that businesses may follow, depending on their managers’ assumptions about ecological sustainability. To develop innovative strategies for ecological sustainability, the dynamic capabilities framework needs to be extended. In particular, the sensing–seizing–maintaining competitiveness framework should operate not only within the boundaries of a business ecosystem but in relation to global biophysical ecosystems; in addition, two more dynamic capabilities should be added, namely, remapping and reaping. This framework can explicate core managerial beliefs about ecological sustainability. Finally, this approach offers opportunities for managers and academics to identify, categorize, and exploit business strategies for ecological sustainability.