Advanced Manufacturing and New Directions for Competitive Strategy

ELSEVIER

Advanced Manufacturing and New Directions for Competitive Strategy Theodore W. Schlie LEHIGH UNIVERSITY

Joel D. Goldhar ILLINOIS INSTITUTE OF TECHNOLOGY

This study examines the potential contributions that advanced manufacturing of the firm. Most of the literature on advanced manufacturing can make to the competitive strategy of the firm. Porter's framework for has focused on the hypothesized or reported benefits derived describing generic competitive strategzes in terms of low-cost leadership, dif- from its successful implementation in terms of cost reductions, ferentiation, and focus is a useful way to begin looking at this linkage, and quality improvements, inventory turns, cycle time compression, several cases of successful implementation of advanced manufacturing in or similar data, without explicit reference to competitive ad- U.S. companies are examined in this light. A closer examination of these vantage. Likewise, most of the literature on competitive strategy cases and a deeper understanding of how companies are actually competing, does not specifically feature the roles that advanced manu- however, lead to some new directions proposed for further thinking regard- facturing can play in achieving competitive advantage. We wish ing advanced manufacturing and competitive strategy: i.e., dangers of dif- to explicidy address these linkages between advanced manu- ferentiation and the advantages of pursuing low-cost leadership at increasingly facturing and competitive strategy and to illustrate them with higher levels of customer acceptability; opportunities available in focusing examples from U.S. firms. We further wish to explore some on customer valued complexity, which takes advantage of the strengths of new directions in which these linkages may evolve in the future. computer and information technology; multiple niche competition as an The traditional factory was built with mechanical technology addition to Porte~s competitive scope situations, the potential for economies to achieve economies of scale, and emphasized large size, high- of scope, the synergy between economies of scale and scope, and the volume mass production, standardized products, and repeat- simultaneous achievement of both low cost and differentiation; and finally ability of specialized operations. Traditional manufacturing was advanced manufacturing competing as a service business, j BUSN RES 1995. described as an evolutionary process, progressing from a 33.103-114 jumbled flow job shop to a disconnected line flow/batch pro-

cess to a connected line flow/assembly line to a continuous flow process (Hayes and Wheelwright, 1979a, 1979b, and 1984). All too often, however, this evolution resulted in an inflexible

T he application of Japanese management techniques and "mechanistic" plant that minimized expenses per unit of output computer integrated manufacturing (CIM) technology- at the strategic cost of an inability to react to changes in market i.e., what we term "advanced manufacturing" in this demand, unforeseen opportunity, or technological change

article-has fundamentally changed the function of manufac- (Abernathy, 1978; Burns and Stalker, 1961). The end result turing and the basis of competition in the industrial world, of "good" process innovation was a factory with high pro- Today, human intelligence is being replaced by machine intell- ductivity but low response capability that became a barrier to igence and integrated with physical machine processes. These the next round of product innovation because that innovation changes have been accompanied by an evolution in manu- would obsolete the existing process investment. facturing "policy" from task specialization to mechanization to The technological features of traditional manufacturing dis- automation to integration, cussed previously created a set of economic constraints that

In this study, we examine the potential contributions that dictated a very low limit to the number of products or models advanced manufacturing can make to the competitive strategy of products that could be economically produced to satisfy a

given market. Traditional manufacturing posed an economic trade-off for the manufacturing manager who was focused on

Address correspondence to Theodore W. Schlie, Rauch Business Center, Lehigh unit costs: as product variety increased, the benefits of econo- University, 621 Taylor Street, Bethlehem, PA 18015. mies of scale decreased. Therefore, the traditional manager

Journal of Business Research 33, 103-114 (1995) Elsevier Science Inc., 1995 ISSN 0148-2963/95/59.50 655 Avenue of the Americas, New York, NY 10010 SSDI 0148-2963(94)00061-1

104 J Bush Res T.W. Schlie and J. D. Goldhar 1995:33:103-114

balanced scale and variety around the lowest total cost point, ogy as the driving force. What are now known loosely asJapa- which significantly limited the number of products or models nese management techniques were started and developed by of products available to customers. Toyota Motor Company as far back as the late 1930s (Ohno,

Traditional manufacturing also accepted long cycle times as 1978; Shingo, 1981; Monden, 1983). The "Toyota Production the "price" of "efficiency." However, if specialization and divi- System," as it is known, was begun in order to introduce vari- sion of labor seemed to increase efficiency in terms of direct ety into economy of scale production systems. Taiichi Ohno labor and equipment utilization, they did so at the expense of (1978), developer of the just-in-time concept for Toyota, says the extended cycle time that was needed to coordinate and inte- in the preface to his book that:

grate the divided manufacturing operations (Lawrence and The Toyota production system was born out of the need Lorsch, 1967). Over time, a set of management "tools" was de- to develop a system for manufacturing automobiles of many veloped to assist in the coordination and integration of this extended production cycle-e.g., sales forecasting, production and different kinds in small volumes with the same process.

inventory control systems, scheduling systems, MRP, etc. The Over a 30-year period, Toyota improved its manufacturing pro- utilization of these tools, however, led to significant increases cess step-by-step, guided by just-in-time and total quality con- in middle management and overhead personnel, which them- trol principles that continually pushed inventory reductions selves added still more time and cost to the operation of the and prevention of defects at their source. manufacturing process (Miller and Vollman, 1985). Costs that What Japanese manufacturing has done is to make tradi- were embedded in surplus time in the system (e.g., inventory, tional, manual production more flexible without the driving expediting) were hidden by the traditional accounting system force of CIM technology. These flexible manufacturing opera- and allocated in with ~ verhead-not the responsibility of the tions have resulted in increased product variety and reduced plant manager (Kaplan, 1986). Time is important for the tradi- cycle time. However, this level of improvement may be only tional plant manager, but it's the immediacy of meeting today's the beginning. If Toyota and other Japanese firms have achieved production schedule within the time of 24 hours per day that significant benefits from flexibility without using CIM technol- is important. In order to "get the product out" in this scale of ogy, what more will they be able to achieve as they increasingly time, in fact, the quality of product, the maintenance of the equip- apply CIM to their manufacturing and business operations? ment, and the morale of the workers were routinely sacrificed. In too many instances, we in the United States have been Because scrap/rework again went into overhead, new equip- arguing after the fact-for a change in competitive strategies ment was an investment decision, and worker morale was not based on the flexibility inherent in CIM technology. Toyota and considered to be particularly relevant outside of union con- other Japanese firms illustrate the potential power of the oppo- tract negotiations, this is not surprising, site approach-that firms with competitive strategies already

As overhead-intensive, economy of scale manufacturing based on fast response and flexibility will find that CIM tech- operations in the United States began to be challenged by lower nology fits more easily and effectively into their operations and cost foreign competition, one perceived solution was to reduce has much greater impact. costs by eliminating possible sources of complexity and confu- Our belief is that the application of Japanese management sion and to simplify manufacturing processes (Schonberger, techniques and CIM technology to all aspects of manufactur- 1987). One result of this trend was the focused factory or plant- ing, including physical process control, materials handling, within-a-plant, in which smaller-scale manufacturing systems production planning and control, and the entire knowledge focus on specific products at different stages in their life cycles, work cycle of design, production, and distribution, has begun on key elements of production that are important, and on a to change the economics of manufacturing in some industries limited number of tasks that they can do well (Skinner, 1986; from economies of scale to indude economies of scope. Goldhar Hill, 1989). Although focusing removed much complexity and andJelinek (1983), for example, describe an "economy-of-scope" some overhead from manufacturing, at the same time it re- factory that can produce a continuous stream of different prod- stricted the variety of products produced and the rate of change uct designs at the same (or lower) costs as an equal-size stream in product design, of identical products in the traditional technology factory with

Today, much of traditional U.S. manufacturing has been made economies of scale. The "economy-of-scope" factory derives its less competitive by a combination of Japanese manufacturing competitive advantage from the flexibility it has, and by the va- management techniques and CIM technology, including famil- riety of different tasks it can perform and the speed with which iar acronyms such as CAD, CAM, CAE, FMS, CNC, etc. (Soci- it can change product designs and production mix. Economies ety of Manufacturing Engineers, 1987, 1988). There is much of scope allow a relaxation of the traditional constraints of documentation of Japanese manufacturing management and its manufacturing, and begin to change the trade-offs between vol- accomplishments available (Abegglen and Stalk, 1985; Schon- ume and variety, and between costs and flexibility. In the "in- berger, 1982; Weiss, 1984), and it need not be repeated here. telligent factory" of the future, variety and innovation will no An important point to note, however, is that even before World longer have to be traded off against productivity and will be- War I1, Japanese manufacturing was moving in the direction come instead the preferred way to compete in the evolving global of product variety and process flexibility without CIM technol- marketplace for many consumer and industrial products.

Advanced Manufacturing and Competitive Strategy J Busn Res ] 0 5 1995:33:103-114

Advanced Manufacturing and ing function and the application of advanced manufacturing Competitive Strategy management and technology.

Schlie has developed a list of eight generic competitive ad- In order to compete with the Japanese, U.S. firms are going to vantages that can create customer value. In brief, customers have to take advantage of the opportunities that advanced choose one product or service over competing alternatives be- manufacturing flexibility provides and formulate and imple- cause: ment competitive strategies that are based on or feature advanced manufacturing attributes. A linkage must be developed the price is lower; between production operations and technology and the corn- the quality is higher, either petitive strategy of the firm or business unit. higher reliability at a given level of performance, or

Many scholars (Christensen et al., 1982; Andrews, 1987; higher level of performance; Chandler, 1962; Mintzberg, 1987, 1988) have contributed to availability is sooner or reliably on time; the concept of "strategy," but "competitive strategy" is a con- customer service is better; cept that is perhaps most closely associated with Michael E. attractiveness is greater; Porter, who expresses it as follows: awareness is greater;

long-term relationships are important; or Essentially, developing a competitive strategy is developing sociopsycholo~cal-political-cultural factors are important. a broad formula for how a business is going to compete, what

its goal should be, and what policies will be needed to carry Porter's low-cost leadership strategy operates through the corn- out those goals (Porter, 1980, p.xvi), petitive advantage of price, and differentiation operates through

Porter organizes the universe of competitive strategies into three any of the other seven. Customers usually set parameters for generic types-low-cost leadership, differentiation, and focus- certain of the previous advantages (won't go above a certain plus a dysfunctional "stuck-in-the-middle" category. Competi- price or below a certain level of quality) and then shop around tive strategies are implemented via "policies" that direct and and decide on the basis of the advantage they value the most. govern the functional activities of the firm such as R&D, man- Schlie has used the above structure to study a number of ufacturing, marketing, and sales. Porter (1985) organizes all of cases of successful implementation of advanced manufacturing the firm's activities in his model of the value chain, and a firm in U.S. firms. These cases are used here to illustrate some of gains competitive advantage by performing value chain activi- the above lineages between advanced manufacturing and com- ties cheaper or better or differently than its competitors and petitive strategy. Basic facts about the companies studied are by managing linkages among its value chain activities or be- summarized in Table 1. tween its value chain activities and those of its suppliers or cus- Company A is a large (Fortune 100) public firm involved tomers, in many businesses or industries. In this case, advanced

A framework for linking competitive strategy and advanced manufacturing in large, heavy defense products was the sub- manufacturing has been developed and used by Schlie (1985, ject of the case, and the major processes were metal machining 1987) in a number of studies of international competitiveness and assembly. Company B is a medium-sized (annual sales in and a number of cases of successful implementation of advanced the hundreds of millions), privately held company making con- manufacturing in U.S. firms. The linkage is built upon assum- sumer products in the home appliance area. The processes ing that the generic goal of industrial firms in market econo- looked at in the case included plastic injection molding, small mies is competitiveness, and defining competitiveness as follows: motor assembly, and final product assembly. Company C is

a small (annual sales less than $100 million), family owned (for Competitiveness is the ability to get customers to choose your most of its life) company making complex, customized ma- products or services over competing alternatives on a sus- chinery components, and involved in custom metal machining tainable basis, and assembly processes. Company D is again a large (Fortune

100) public company involved in many businesses. In this case, The competitiveness of a firm is determined then by its cus- electronics assembly processes for the manufacture of small,

tomers: complex consumer products were the subject of the case study.

Competitiveness is a collective decision made by the cus- Company E is a medium-sized, privately held company mak- tomers of products or services when they choose one prod- ing a single consumer product. The processes examined in this uct or service over competing alternatives, for reasons which case were metal machining of engine parts and engine assem- are satisfied by firms in applying their competitive strategies bly. Company F is a large (Fortune 100) public company in-

volved in a few, distinct businesses. The case dealt with de- through the implementation of functional policies, lense products and included metal machining of large heavy

The reasons why customers choose one competing product or parts and composites structures fabrication and curing. Finally, service over others are competitive advantages, and one means Company G is a large (Fortune 200) public company involved of achieving competitive advantage is through the manufactur- in many businesses/industries, including making parts for cer-

106 J Busn Res T.W. Schlie and J. D. Goldhar 1995:33:103-114

Table 1. Firm Characteristics

Company Single/Multi Processes Ownership a Size Product Industry Firm

A Public Large Defense Multi Metal machining and assembly

B Private Medium Consumer Single Plastics molding, small motor assembly, and

final product assembly C Private Small Machinery Single

Custom metal machining and assembly Component D Public Large Consumer Multi

Electronic assembly E Private Medium Consumer Single

Metal machining and assembly F Public Large Defense Multi

Metal machining; composites fabrication and curing

G Public Large Consumer Multi Materials processing, forming, and fabrication Electronic parts

a Two of the privately held companies had recently gone through leveraged buyouts and are owned or controlled by management.

tain consumer electronics products. The processes studied in brand name awareness. The strategy included not only the im- the case included materials processing, forming, and fabrication, plementation of CIM technology to significantly lower costs while

In all of these cases, advanced manufacturing is an integral maintaining/improving quality, but also a complete redesign contributor to the achievement of the companies' competitive of the product to both: (1) make it more manufacturable and advantages. In at least one case, advanced manufacturing is the (2) significantly improve it by cutting its weight almost in half direct source of competitive advantage. The competitive advan- and greatly enhancing its ease-of-use. tages achieved by these companies are discussed and described Company C was also pursuing a focused differentiation later, strategy based on product availability (lowering custom design

The threat of competition, domestic (companies B, C, and and machining cycle times) and enhanced customer service and F) and Japanese (companies D, E, and G), was the primary moti- responsiveness. Company C's products are customized ma- vator for investing in advanced manufacturing. All of the corn- chinery components that can be a critical part of OEM cus- panics, of course, in entering into their CIM investments wanted tomers' machines. In this market, high quality in terms of dimen- to increase productivity, reduce inventory, reduce direct labor, sional tolerances and reasonable prices are necessary just to reduce cycle times, increase quality, and so on, and all of them be in the competitive ball game. Company C's strategy included achieved significant gains in these areas. Yet, when talking to extensive upgrading, expansion, and integration of the prod- executives in these companies, it was the threat of competition- uct design process, including the ability to store, catalogue, and domestic and Japanese-that was at the heart of their efforts, retrieve design features so that not everything had to be de-

The one possible exception was in the Company A defense signed from a zero base, real time integration with CNC machin- products case. Competition does exist in defense contracting, ing operations on the factory floor, and some integration with but once a contract is awarded the awardee has a clear advan- parts/materials inventory and order processing. An additional tage in continuing and enhancing its position as long as the mill- element that was very intriguing was an expert system that cus- tary customer is satisfied with its performance. In this case, the tomers could use to help in designing their own, customized immediate and primary motivation for Company A investing components. in advanced manufacturing was to achieve productivity gains Company D credits its efforts in advanced manufacturing and avoid investment costs otherwise necessary to reach sub- for it being the sole remaining U.S. survivor- and world leader- stantial increases in output. The company was not shy, how- in a product line now otherwise dominated by the Japanese. ever, about pointing out its achievements in quality and on- An advanced CIM system is simultaneously increasing the reli- time delivery to its military customer, and in a fundamental ability of Company D's products and enabling it to operate with sense was working to preempt any competition, a lot-size-of-one flexibility. In addition, order processing has

In the Company B case, which concerned a consumer prod- been electronically integrated with the CIM scheduling system, uct in the home appliance area, advanced manufacturing was allowing production to order and shipment of one-of-a-kind being used to lower the cost penalty (and resultant price products within 24 hours of the placement of the order. The premium) associated with its focused differentiation strategy combination of flexibility and 24-hour production to order based on high product quality (durability and ease-of-use) and lowers costs significantly through inventory and paperwork

Advanced Manufacturing and Competitive Strategy J Busn Res 107 1995:33:103-114

reductions and by preempting the possibility of order changes, lie's administrative innovations would be considered Japanese Advanced manufacturing has also given Company D many op- management techniques. tions to pursue in maintaining or increasing their leadership Schlie's cases also strongly suggest that U.S. firms which have position in this product line. successfully implemented CIM technology have also imple-

Company E has in recent years competed on the basis of mented several Japanese management techniques, either preced- focused differentiation, based on the attractiveness of its prod- ing or in parallel with the CIM implementation. In all of the uct design and its brand name image and allure. Yet, 10 years cases, companies had accepted and were emphasizingJIT, TQC, ago they almost went out of business due to Japanese competi- and various forms of workforce participation to varying degrees. tion and problems in their own manufacturing operations that Kanban (pull) scheduling of production was less utilized, but were producing products with declining reliability at greater is complicated by differences in manufacturing to order versus and greater cost. Advanced manufacturing for Company E in- stock, and by differences in capacity utilization and market de- cluded very basic process redesign and control, quality con- mand among the cases (Schlie, 1989). Implementing these trol (SPC), and some new CIM technology that lowered manufac- management techniques successfully can lead to significant and turing costs and raised product reliability to the point where immediate benefits in many U.S. companies. Indeed, in two of they now compete very successfully with the Japanese in their Schlie's cases where the implementation of Japanese manage- market segment, ment techniques preceded the implementation of CIM technol-

For Company F, an aerospace major subcontractor, advanced ogy, there is the strong belief that much of the bottom line manufacturing is their direct source of competitive advantage, benefits so far achieved have resulted from the management their differentiating uniqueness. In sum, they are pursuing ad- changes rather than the CIM technology! vanced manufacturing to give them capabilities that no other When Japanese management techniques are pursued blindly competitor (or prime contractor customer) has or can dupli- or superficially, however, some unforeseen problems can re- cate. These capabilities translate into higher quality (dimensional suit-particularly in reducing inventory and in raising quality tolerances, for the most part) at much lower costs that preempt levels. For example, automated CIM systems normally need competitive challenges, higher conformance quality parts/components so that feeders

Finally, Company G is pursuing advanced manufacturing don't jam and parts can be assembled by robots. Japanese prac- just to be able to stay in the competitive ball game with theJap- tices in "partnering" with vendors have demonstrated how the anese. The key to competition in this business at the moment quality of incoming parts can be significantly raised and at the is product reliability (number of defects), which is significantly same time costs lowered and delivery time improved. Yet some affected by innumerable material and process variables in very early attempts by U.S. OEM's to blindly implement JIT delivery demanding material process and forming operations. Advanced from suppliers only resulted in JIT warehouses, declining con- manufacturing technology has lowered labor costs and cycle formance quality, and increased tensions between the would-be times, but mostly it has played an essential role in enhanced "partners." process understanding and control-thereby lowering prod- Inventories do have a purpose. They function as insurance uct defects. This saves scrap costs, but its real value lies in keep- against the possibility of running out of an item or material and ing very demanding customers satisfied. At this point, Corn- the resultant costs that would be incurred. Like any insurance, pany G is trying to keep up with Japanese product reliability, a premium in the form of carrying or holding costs must be hoping in the future to be able to surpass them and achieve paid. Surely American manufacturing has been guilty of hold- differentiation on the basis of product innovation and customer ing too much inventory insurance, particularly in WIP, and ef- service, forts to reduce this insurance are producing great benefits not

These cases also illustrate both the synergistic synthesis that only in premium reductions but also in identifying underlying exists between Japanese management techniques and CIM tech- problems and having the chance to remedy them. But doing nology, and some potential dangers of blindly or superficially away with all insurance in the manufacturing process may be copying portions of Japanese practices and pushing things too going too far. far. The separate treatment of Japanese manufacturing manage- What must be remembered is that reducing WIP leaves the ment techniques and CIM technology has been evident in many process more vulnerable to things that can and will go wrong. conferences and publications that have addressed advanced The Japanese recognize this and make every attempt to fool- manufacturing (Schonberger, 1982, 1986; Ciampa, 1988; Grieco, proof their systems against disruption, and use warning lights 1987; Hall, 1987). Yet both Japanese management and CIM tech- and/or other mechanisms to focus all attention on a process- nology have in common a fundamental reason for being-i.e., stopping problem when it does occur. They also, however, flexibility. Moreover, Ettlie (1988) has shown that the simul- schedule their production below full capacity so that if the pro- taneous adoption of technological and administrative innova- cess does go down, the day's schedule can still be met if the tion in manufacturing-"simultaneous innovation"-succeeds to problem can be resolved. a much greater extent than technological innovation adopted More fundamentally it seems, the Japanese have a "liberated" without the accompanying administrative changes. Most of Ett- view of idle t ime- machine idle time or human idle time. They

108 J Busn Res T.W. Schlie and J. D. Goldhar 1995:33:103-I 14

accept it in the trade-off against lower WIP and higher quality, but are apart from t h e m - factors that may constitute a discon- They do try to keep their people busy during idle times with tinuous change in the business environment. Factors such as routine maintenance, housekeeping, training, and other skill shorter and shorter product life cycles, especially in high tech- enhancing activities, but they do not have a fetish for keeping nology products; greater product diversity and variety serving machines or people operating. Although some U.S. manufac- markets that are fragmenting into unprecedented niches, at the turers may have accepted the wisdom of this approach in their same time that global products and global markets are very head, it is still very difficult for them to accept idle time in their popular terms; increasing worldwide competition from diverse gut. But until constructive idle time and scheduling below full sources using diverse competitive strategies and tactics; wide- capacity become part of theJIT equation, a handbook approach spread and increasingly fast imitation (sometimes illegal) and to WIP reduction may run into problems, improvement of products and processes; and increasingly so-

Much the same thing may be true of the wholehearted en- phisticated and demanding customers that may nevertheless dorsement of quality that is evident in many U.S. manufacturers need more education and services to effectively use what they today. Considerable confusion exists between the ideals of purchase. defect-free conformance to quality standards and raising per-

formance standards or design specifications, particularly with The Dangers of Differentiation respect to dimensional tolerances. In the first instance, quality may indeed be "free" as the benefits of scrap and rework reduc- In a recent article, Kenichi Ohmae (1988) took Japanese bus- tions, warranty cost reductions, and less customer dissatisfac- inessmen to task for continuing to follow low-cost leadership tion more than outweigh the added costs of a zero defects strategies based on economies of scale, learning curves, market investment. But raising performance standards-part icularly share, and low prices. His basic point was that large parts of dimensional tolerances- is a different matter. Higher quality per- Japanese industry had progressed beyond the point where they formance standards often can be achieved only at greater costs, needed to rely on low-cost-low-price strategies; they now had and therefore must be examined in terms of customer value, the capabilities and the resources that afforded them the op- As one executive noted to Schlie, "The dip stick hole (in an en- portunity to play in the (implied) higher level strategic game gine block) doesn't need to be drilled to the same tolerance as of differentiation in which the higher quality or the faster in- the piston cylinders!" troduction and delivery of Japanese products could earn them

When an unrestrained and unspecified drive for increased a price premium and much greater profits. "quality" runs rampant however, this type of thing can happen. What causes some discomfort with this argument is the as- In one of Schlie's cases, the company found that tighter dimen- sumption that Japanese success is built on a low-cost leader- sional tolerances designed by their engineers for a machined ship strategy. When one looks at the history of Japanese com- part to be assembled into a product would result in 40 more petition in industry after industry, one sees elements of both minutes of machine time on a cutting operation. When they low cost and differentiation. Japanese enter the U.S. television examined the need for this tighter specification closely from market with low price black and white TVs, but are the first the perspective of customer value and the conformance quality to introduce solid state electronics to color TV and to gain per- of the assembled product, however, they found that any in- formance recognition in picture quality and product reliabil- creases were irrelevant or negligible. In another of Schlie's cases, ity. Japanese motorcycle manufacturers define new market seg- the only way in which progress toward six sigma quality tar- ments in the United States, but they also outperform U.S. gets on dimensional tolerances of machined parts could be competitors and are sold at lower prices. Japanese automobiles achieved was to redesign the total, assembled product in such enter the U.S. market with both high performance and low cost, a way that the tolerance requirements of the individual parts win performance awards, and are noted for their low defect could be relaxed! rate, durability, and innovation. In case after case, Japanese prod-

ucts appear to exhibit aspects of both differentiation and low-

New Directions for Competitive cost leadership! According to Porter (1985, p. 13), it is only "rarely possible"

Strategy for a firm to successfully pursue more than one generic com- As a result of extensive thinking about these and other cases petitive strategy at a t ime - i.e., to be both a low-cost leader and that relate to interrelationships between advanced manufactur- differentiated. To some extent there may be logical explana- ing and competitive strategy, we offer here four additional con- tions for this seeming inconsistency, but still the nagging ques- siderations to be added to our previous discussion. These four tion remains: the Japanese seem to be able to produce many additional considerations are presented under the headings of: goods at less cost than we can, and at the same time they also the dangers of differentiation; focusing on customer valued com- seem to be continually raising product performance levels (al- plexity; multiple niche competition; and manufacturing com- most always a trade-offwith costs), introducing more new prod- peting as a service business, ucts faster, and often supplying better customer service along

Our thinking has been motivated in part by a set of factors with the new products! How can they achieve both low cost that are related to developments in advanced manufacturing and differentiation at the same time?


Several of Schlie's cases raise the same questions. Some of threshold of acceptability and competing on low cost-low price, them (Companies B, C, and E) are pursuing strategies that can these companies accomplish two things: be adequately described and explained in traditional Porter

1. They preempt any competitor from imitating a differen- terms of focused differentiation. But in other cases (Compa- tiating uniqueness and catching up. The competitor must nies A, D, and G), Porter's terms do not work so well. (Com- also be able to do so at low cost or lose money on each pany F will be discussed later.) In each of these other cases, the companies seem to be pursuing both low cost and several transaction. Faced with companies who are continuously

offering higher quality, faster delivery, better service, or aspects of differentiation such as higher performance, greater reliability, or faster delivery, either to preempt or catch up with other differentiating features at a low price, competitors

often give up in despair of ever catching up to- le t alone competition, surpassing-this type of juggernaut.

This seeming paradox can perhaps be resolved if we pay 2. They avoid a key danger of differentiation that occurs more attention to two important details about differentiation

as soon as competitors have successfully imitated the and low-cost leadership that Porter mentions but which are

uniqueness on which the differentiation strategy is based. often overlooked or underappreciated. The first detail is that At that point, competition returns to cost-price. When a "uniqueness" is the heart of a differentiation strategy. Unique- the basis for competition suddenly changes from differ- ness is probably a little bit like pregnancy-a firm's basis for differentiation is either unique or it's not; it's hard to be a little entiation to low-cost leadership in these situations, the bit unique. Moreover, the standard for being unique is rather pioneer who, for a time, was uniquely differentiated may

be ill-prepared to make the switch. Companies who avoid rigorous-as soon as one other competitor has the same or a similar uniqueness, it is no longer unique! this danger are not faced with the wrenching change of

It is true that Porter's (1985, p. 37) exact words refer to some- converting their corporate culture, their method of oper- thing that is "perceived.. . [by the customer] as being unique." ations, their control and reward systems, etc. from those Nevertheless, with increasingly sophisticated customers and of a differentiated competitor to those of a low cost corn-

widespread competition, perceptions of uniqueness must be petitor. increasingly corresponding to reality. (One exception to this In reflecting on the dangers of differentiation, it would ap- may be brand name identity or image as a source of perceived pear that we in business/management schools have played a uniqueness, one aspect of the awareness competitive advantage.) part in perhaps overemphasizing the importance of differenti-

The second detail that Porter (1985, p. 13) points out is that ation strategies and underemphasizing low cost leadership. For the successful low cost competitor cannot reduce the differen- example, in an earlier article, we (Schlie and Goldhar, 1989, tiation parameters of competition below a threshold of com- p. 38) had argued that:

parability or acceptability held by customers-i.e., in terms of 1. CIM technology greatly enlarges the scope of differentia- reliability, performance levels, availability, customer service, etc. tion possibilities- the scope of competitive advantage- that cannot fall below acceptable levels as perceived by the cus- that can be achieved through manufacturing; and at the tomer. If they do, the low-cost competitor becomes regarded

same time. as a discount competitor or a manufacturer of low-quality goods.

Whereas Porter warned against low-cost leaders falling be- 2. CIM technology, because of its flexibility, lowers the cost low a customer threshold of acceptability/comparability, it is penalty for differentiation achievable through manu-

facturing-in some cases may lower it on a par with or also clear-particularly in recent years-that U.S. customers' ex- below the costs of a large scale competitor pursuing a pectations of what constitutes acceptable levels of quality, deliv- low cost leadership strategy with dedicated automation ery, service and other differentiating parameters have been significantly rising-often being driven up by foreign competition, technology.

Thus a great deal of competition that at first appears to be It is differentiation that has captured most of the attention, the based on differentiation because it involves higher performance glamour, the creativity of the academic community; low-cost levels or new features, may actually be low-cost competition leadership has a more mundane, grubby quality. Perhaps this at increasingly higher thresholds of acceptability for differenti- article will stimulate new interest in this area. ation parameters valued by customers. This interpretation helps to explain how the Japanese and some of Schlie's cases are com- Focussing o n Customer-Valued peting in terms of competitive strategy. These companies are C o m p l e x i t y continuously leaders in offering unique advantages in quality, delivery, service, and other differentiating features, but instead Our second consideration concerns the extreme devotion to of competing on the basis of differentiation and seeking a price Japanese manufacturing management techniques exhibited by premium for their customer-valued uniqueness, they prefer to some experts in the field-and in particular the prescription convert their uniqueness into an ever higher threshold of cus- for process "simplicity." As indicated earlier, the Japanese de- tomer acceptability and compete on the basis of low cost-low veloped and implemented their manufacturing management sys- price at that threshold. By continuously raising the customer tems over a long period of time. Emulating what they accom-

110 J Busn Res T.W. Schlie and J. D. Goldhar 1995:33:103-I 14

plished 20-30 years ago may be a necessary condition to In order for this to happen, of course, we must move from compete, but is is far from sufficient. Those, in particular, who manufacturing engineering to manufacturing science so we focus exclusively or primarily on "simplicity" (Schonberger, know why and h o w - i n addition to what-fabricat ion and as- 1987) are in danger of fighting the competitive war of the fu- sembly phenomena occur. We must also be able to transfer this ture with the weapons of the battlefield of 20-30 years ago. knowledge to software code, and to have the sensors and feed-

There is much to gain from applying Japanese management back controls, the tooling, the clean rooms, and so forth, that principles like just-in-time production and total quality con- will enable us to create these systems of the future. trol, and because we can learn from mistakes the Japanese made But these are the areas in which we need to be focusing our it need not take us nearly as long to put them effectively into firms' and our nation's effor ts-not on simplicity. Process com- practice. Moreover, the big gains from these techniques un- plexity, of course, must be used to produce unique customer doubtedly occur toward the beginning of their effective im- value in product form. No amount of high-tech sophistication plementation. The Japanese may strive for continual improve- will work if customers don't value what is being produced, and ment in reducing work-in-process or product defects, but the if the same customer value can be produced with a simpler law of diminishing returns suggests that their marginal gains process, there is no advantage in complexity. But some mar- will be increasingly smaller as they approach zero inventories kets appear to be fragmenting and the scope of customer values or zero defects, that can be economically satisfied through computer controlled

The concept of simplification, however, is more problematic complex manufacturing processes is growing ever larger. and is a two-edged sword. Simplification is necessary for man- Such process complexity, once put into place and operating ual production systems. It is necessary for employees to un- effectively, may even - in the future- turn around the traditional derstand the system and to participate in making it operate more logic of new product development project selection. Tradition- effectively. It is necessary because the data processing capacity ally new products have been identified based on the firm's of the human brain is limited in terms of both the amounts perceived product design or market strengths. Advanced of data it can retain in memory and its speed of processing, manufacturing today means designing those new products to The more complex the process, the more the data and the faster be manufacturable. In one of Schlie's cases, however, the exis- that data needs to be processed in order to keep the process tence of a successfully operatingCIM/FMS system had prompted under control. Humans simply can't handle it. the firm to approach new product identification from the other

Computers, however, can not only handle large amounts of direction-i.e. , to ask, what other products could we make on data and high rates of data processing, that is their strength! our CIM/FMS system that are or would be difficult to make It is true that applying CIM automation to traditional manufac- using traditional manufacturing technology? turing processes that are not under control and plagued with

waste, long cycle times, and missing or inaccurate data has been Mult ip le Niche Competition notoriously unsuccessful. As anyone familiar with the GIGO phenomenon can attest to, in this kind of situation the corn- Although Porter, as indicated earlier, spoke of three generic puter will only get you the wrong answer faster or perform a competitive strategies-low-cost leadership, differentiation, and non-value adding activity more precisely. Therefore simplica- focus -we argue that the focus strategy is more an element of tion of the process is often prescribed as being a necessary competitive scope than a strategy in and of itself. The initial precondition to CIM automation. This simplification is not for two strategies were actually industrywide low cost leadership its own sake, however, but to get processes under control and and industrywide differentiation, whereas the so-called focus make them waste-free, timely, and accurate before applying CIM strategy was subsequently divided by Porter into focused low- automation. To argue for simplification for its own sake ignores cost leadership and focused differentiation. Therefore, Porter's perhaps our nation's greatest asset in manufacturing- our tech- framework of generic strategies can be more profitably viewed nological strength in computers, software, and information tech- in terms of two generic strategies-low-cost leadership and nology in general, differentiation-applied to two competitive scope si tuations-

Moreover, a simple manufacturing capability is likely to be industrywide competitive and focused compet i t ion-see Fig- able to be simply cop ied - and gone one better by a competitor ure 1A. In this section of the article we propose to add a third who does take advantage of the strengths of computers and in- competitive scope situation, that of multiple niche competition formation technology. Focusing on the manufacture of prod- (Lei and Goldhar, 1990)-see Figure 1B. We will also argue that ucts that require complex CIM processes in order to make them, flexible CIM manufacturing applied to multi niche competition however, can be a way to achieve and sustain competitive ad- situations-particularly across product lines or industr ies- vantage. As the President of Rogers Corporation is quoted as potentially allows the firm to simultaneously achieve low-cost saying in a Harvard Business School case (March, 1985): leadership and differentiation.

Traditional businesses and factories emphasized mass pro- We don't want to do something anyone can do; we look for duction economies of scale or batch production/customized things that are complex to make and which require sophisti- job shops with little or no economies of scale. Economies of cated manufacturing methods, scale are well-known. As mentioned earlier, advanced manu-


Figure 1. Porter's generic strategies, zero finished goods inventory, and still meet quick delivery re-

A: Porter's Generic Strategies Revised quirements. The downside of the level scheduling trade-off- the accumulation of finished goods inventories to handle sea-

es Low Cost sonal fluctuations in demand-can now be avoided by the Leadership Differentiation judicious selection of a product mix whose individual demand

patterns are complementary and can be varied without cost

Industry-Wide or time penalty. It is important to note that economies of scope are not neces-

sarily achieved at the expense of economies of scale. If the range or number of different products made on a flexible CIM system

Focus is great enough, even at low volumes per product, the total output of the system can be quite large. Thus, the broader the variety capability and the faster the response speed of an opera-

B: Porter's Generic Strategies and Multi-Niche Competition tion, the greater the scale economies it is possible to achieve. In other words, high levels of economies of scope can result

~ e s in higher levels of economies of scale, as high as would be pos- Low Cost Leadership Differentiation sible in a traditional factory. In addition, flexibility and speed

in themselves may have scale economies-i.e., more flexible Industry-Wide machines and faster information systems combined with more

responsive organization structures may achieve a decreasing cost per "unit of variety." Therefore, a CIM manufacturing system with a high degree of strategic flexibility may exhibit sig-

Focus nificant synergy between economies of scale and scope. Studies in economics have recently begun to show that firms

wishing to maintain a strong competitiveness in manufacturing must plan for economies of scope, economies of scale, and

Multi-Niche a responsive organization simultaneously to achieve the full Competition benefits of CIM technology. Milgrom and Roberts (1990) note

that:

the "Cluster" of characteristics that are found in technologi- cally advanced manufacturing firms include rapid exploita-

facturing-the application of Japanese management techniques tion of mass data communications, production equipment and CIM technology-potentially enables the creation of econ- with low set-up and changeover costs, versatile design tech- omies of scope which, however, are not so well-known, nologies, very low levels of inventories and short produc-

Economies of scope are defined as cost savings that result tions cycle t i m e s . . . "clustering" is no accident. Rather, it from multi product manufacturing systems (Panzar and Wil- is a result of the adoption by profit-maximizing firms of a

coherent business strategy that exploits complementarities, lig, 1977). Advanced manufacturing flexibility gives firms the and the trend to adopt this strategy is the result of identifi- ability to produce one-of-a-kind products within the parameters able changes in technology and demand. of the CIM system with little or not cost or time penalty. If markets are found or created that value one-of-a-kind customiza- "Complementarities" in this sense can exist in the CIM envi- tion, the flexible manufacturer can strive to supply such cus- ronment across product designs. tomization more rapidly than any competing supplier and so In multiple niche competition, the full advantages of econo- achieve focused differentiation. Thus CIM flexibility offers both mies of scope and flexibility can be seen. The flexible multiple the competitive advantage of availability-having a customized, niche competitor will be able to serve a narrow market seg- one-of-a-kind product available to the customer sooner than ment (even perhaps a segment of one!) at a low cost, benefiting competing suppliers- and the lowering of costs through econ- from the price premium that can be obtained when a product omies of scale and scope, is differentiated by most closely fitting its design to the needs

Economies of scope can be expressed in many different ways. of the customer (especially if designed by that customer!) and Because a CIM system can switch from one product design to availability. By serving many small segments, the CIM-based another (within the parameters or envelope of the system) with business will also benefit from the economies of scale resulting little or no cost or time penalty, the risk that an investment in from high cumulative volume, and economies of scope result- a high volume plant might be made obsolete by sudden changes ing from the variety of products. The combination of high prices in market demand is considerably reduced. If manufacturing and low production costs could potentially result in very high to order is possible, firms can produce in lot sizes of one, have profitability, sustainable over an extended period as the fast


response part of the equation allows the firm to cater to multi- as a service business-for example, the cobbler who crafted a ple simultaneous niches and exit from low profit ones as mar- pair of shoes for your feet only. This was, of course, a high-cost ket conditions dictate. Thus the lack of a boundary line in Fig- way of doing things. So manufacturing- starting with the mak- ure IB between low-cost leadership and differentiation for ingofpins-became"industrialized" with the mass production multiple niche competitive scope, of standardized products. Customers were willing to accept stan-

Strategies based on multiple-niche competition thrive upon dard products, either because there was little value to be had the high-quality proliferation of numerous product designs, from customization, or the cost advantage was so great as to rather than a standardized design that is easy for competitors overwhelm any benefits from customization. This concept of to imitate. Moreover, the creation and possession of a vast range industrialization is not limited to physical work. Today we see of product families or groups driven by CIM technology help many examples of the industrialization of"services" and knowl- provide the firm with a competitive buffer from any competi- edge work with similar problems of failure to respond to change tors' incursion into any one niche. To some extent, however, and the loss of flexibility. The constraints of industrialization the benefits to the multi niche competitor depend on whether are not limited to the factory and the concept of a service busi- the niches are within one business or product line, or extend ness can be applied to physical production as well as knowl- across business or industries, edge work. This further emphasizes the power of economies

In a recent report to the Center for Innovation Management of scope, which can apply to both information work in banks, Studies, Sanderson and Uzumeri (1990) describe an example offices, etc. and to CIM based factories (Quinn and Gagnon, of the first kind of multiple niche competi t ion- the Sony Walk- 1988). man. In 1979, when Sony first introduced its Walkman to the Consider, for example, the industrialized tennis shoe or market, there was one standard product. By 1990, Sony had "sneaker" of 30 or more years a g o - a mass-produced, stan- introduced over 160 different models of the Walkman into the dardized item used for very specific and limited activities. To- market to appeal to different customer tastes, requirements, and day we have moved from this tennis shoe/sneaker to a wide price ranges! The differentiation advantages of customization range of high-tech, intensively marketed athletic shoes. And con- in a fragmentable market went hand in hand with the advan- sider the potential athletic footwear operation of the future, tages of flexibility and economies of scope, which supplies customized footwear for basketball, tennis, hik-

The benefits from multi niche competition should increase ing, skiing, skating, golfing, football, or soccer. When I go into as the niches are spread across businesses and/or industries, this store to purchase ski boots, the attentive sales person wants based on core competencies in markets, products, or technol- to know my skill level (expert, intermediate, beginner), my ogles. For example, Prahaled and Hamel (1990) describe 3M weight, height, and body frame, whether I intend to ski on the as being strong in every market niche that is related to the East Coast or in the Rockies (ice vs. snow), a n d - i n the case production and use of adhesives, tapes, films and abrasives, of the Rockies-whether I will ski on packed snow, powder, The company consistently invests in new generations of prod- or both. The salesperson will then put me in a simulation room, ucts and processes to preempt and to meet competitive chal- placed in sensorized boots on a tilting platform, and ask me lenges as well as unforeseen market changes. They also refer to ski down a simulated mountain. These data are all fed into to Canon, whose automated plants are able to produce a wide a CAD program-Oh, and what color did I wan t? -and 20 variety of fax machines, cameras, and personal copiers. The minutes later my individually customized ski boots come off technology base underlying all three products rests on fine op- the CIM system located in the back room. As I leave, I am tics and machine design, reminded that updating my boots on an annual basis is possi-

ble through an extended service plan and that recycling refunds for used boots are available.

A Service-based Competitive Strategy As we examine this and other examples we can construct a set of characteristics of service based competition as follows:

for Manufacturing Firms 1. High variety to the extent of customization of product This article highlights the extent of the departure from tradi- design for each customer tional practice that advanced manufacturing management makes 2. Rapid adoption of new technology and production possible. Investment in CIM technology will provide accept- 3. The integration of physical work with knowledge work able returns, however, only if flexibility exists throughout the and management decision making at a single point of organization embracing engineering, distribution, and other contact-either human or machine or combination functions (Stalk and Hout, 1990). Taken together, these changes 4. Fast response t ime-shor t production cycles may constitute a shift from "industrial" manufacturing to some- 5. Close linkage between producer and customer- very di- thing far more "service based" (Goldhar, Jelinek, and Schlie, rect distribution channels 1991). In this new manufacturing environment a factory is "user 6. Flexible pricing and negotiated (contractual) relation- transparent" to the product designer, the marketing department, ships or even the customer (Goldhar, 1985). 7. High-information content transactions between supplier

From a historical point of view, manufacturing originated and customer


8. Long-term relationships in which both supplier and cus- higher levels of customer acceptability; we point out the op- tomer "learn" and become more efficient in their trans- portunities available in focusing on customer-valued complex- actions with each other ity that takes advantage of the strengths of computer and infor-

9. Customer participation in the design of the product mation technology; we propose multiple niche competition as 10. Zero finished good inventory an addition to Porter's competitive scope situations and point

out the potential for economies of scope, the synergy between One could imagine "grading" a business against each of these economies of scale and scope, and the simultaneous achieve-

variables on a scale from 1 to 10, from a "pure" service to a ment of both low cost and differentiation; and finally we point totally "industrialized" business. We argue that the more out how advanced manufacturing can enable companies to corn- manufacturing firms compete as a service business, the harder pete as a service business. it is to imitate and the more likely it is that the firm can create and sustain a competitive advantage, thus securing long-term profitability in the global marketplace. The authors gratefully acknowledge the support and cooperation of the Wood-

The service basis of manufacturing competition is a Prince Trust, the Automation Forum, and the Center for Innovation Manage- customer-oriented focus that shifts competitive advantage from ment Studies at Lehigh University in furthering their research.

factor costs to the firm's ability to innovate and to identify customer needs. CIM technology makes it possible-by enabling high variety and responsiveness. Competition makes it necessary. References

A prototypical example of a manufacturing firm competing Abegglen, James C., and Stalk, George, Jr., Kaisha, The Japanese Corpo- as a service business is Schlie's case of Company F, earlier de- ration, Basic Boosk, New York. 1985. scribed as an aerospace major subcontractor for whom ad- Abernathy, William J., The Productivity Dilemma, The Johns Hopkins vanced manufacturing is the direct source of their competitive University Press, Baltimore, MD. 1978. advantage, their differentiating uniqueness. This company com- Andrews, Kenneth R., The Concept of Corporate Strategy, Richard D. petes as a supplier of manufacturing services to their cus- Irwin, Homewood, IL. 1987. tomers - they can produce parts and subassemblies faster, to Burns, Tom, and Stalker, G. M., The Management of Innovation, Tavistock

Publication, 1961. higher design standards, and at lower cost than can any competing supplier or their customers themselves. They compete Chandler, Alfred, Strategy and Structure: Chapters in the History of In-

dustrial Enterprise, MIT Press, Cambridge, MA. 1962. not only through manufacturing, however, but through very close customer (and the customer's customer) contact and be- Christensen, C. Roland, Andrews, Kenneth R., Bower, Joseph L., Hamer-

mesh, Richard G., and Porter, Michael E., Business Policy: Text and ing able to foresee what the customer will need in the future Cases, Richard D. Irwin, Homewood, IL. 1982. and taking steps now to be able to supply that need when the Ciampa, Dan, Manufacturing's New Mandate, John Wiley & Sons, New time comes. Company G is moving in a similar direction. York. 1988.

Ettlie, John E., Taking Charge of Manufacturing, Jossey-Bass, San Fran- cisco. 1988.

Su mmary and Conclusions Grieco, Peter L.,Jr., and Gozzo, Michael W., Made in America: The To- tal Business Concept, PT Publications, 1987.

In this article we have attempted to summarize the changes that are occurring in U.S. manufacturing as a result of the applica- Goldhar, Joe] D., The Transparent Factory. CIM Maga~ne (March-April

1985). tion of Japanese management techniques and CIM technology.

Goldhar, Joel D., and Jelinek, Mariann, Plan for Economies of Scope. Such changes are resulting in greater process flexibility, prod- Harvard Business Review (Nov-Dec 1983).

uct variety, throughput speed, and customer responsiveness Goldhar, Joel D., Jelinek, Mariann, and Schlie, Theodore W., Flexibil- capabilities than have been imagined heretofore. In order to ity and Competitive Advantage-ManufacturingBecomes a Service exploit these new manufacturing capabilities in commercial mar- Business. International Journal of Technology Management 6(3/4) kets, however, a link must be forged between advanced manu- (1991). facturing and competitive strategy. Hall, Robert W., Attaining Manufacturing Excellence, Dow Jones-Irwin,

Porter's framework for describing generic competitive strate- 1987. gies in terms of low-cost leadership, differentiation, and focus Hayes, Robert H., and Wheelwright, Steven C., Link Manufacturing is a useful way to begin looking at this linkage, and several cases Process and Product Life Cycles. Harvard Business Review (Jan-Feb of successful implementation of advanced manufacturing in U.S. 1979). companies are examined in this light. A closer examination of Hayes, Robert H., and Wheelwright, Steven C., The Dynamics of

Process-Product Life Cycles. Harvard Business Review (March-April these cases and a deeper understanding of how companies are 1979).

actually competing, however, lead to some new directions we Hayes, Robert H., and Wheelwright, Steven C., Restoring Our Competi- propose for further thinking regarding advanced manufactur- rive Edge: Competing Through Manufacturing, John Wiley & Sons, ing and competitive strategy. New York. 1984.

Specifically, we point out the dangers of differentiation and Hill, Terry, Manufacturing Strategy, Richard D. Irwin, Homewood, IL. the advantages of pursuing low-cost leadership at increasingly 1989.


Kaplan, Robert S., Must CIM Be Justified by Faith Alone. Harvard Busi- Ohmae, Kenichi, Getting Back to Strategy. Harvard Business Review ness Review (March-April 1986). (Nov-Dec 1988).

Lawrence, Paul R., and Lorsch, Jaw W., Organization and Environment, Ohno, Taiichi, Toyota Production System, Diamond Publishing, 1978. Richard D. Irwin, Homewood, IL. 1967.

Lei, David, and Goldhar, Joel D., Multiple Niche Competition: The Stra- Panzar, J. C., and Willig, R. D., Economies of Scope. American Eco- tegic Use of CIM Technology. Manufacturing Review 3(3)(Sept 1990). nomic Review 7(2)(1977).

March, Artemis, The Rogers Corporation: Electroluminescent Lamps Porter, Michael E., Competitive Strategy, The Free Press, New York. 1980. (A), Harvard Business School Case 686-060, 1985.

Milgrom, P., and Roberts, J., The Economics of Modern Manufactur- Porter, Michael E., Competitive Advantage, The Free Press, New York. ing: Technology, Strategy and Organization. American Economic Re- 1985. view 80(3)(1990).

Quinn, J. Brian, and Gagnon, Christopher E., Will Services Follow Miller, Jeffrey G., and Vollman, Thomas E., The Hidden Factory. Har- Manufacturing into Decline? Harvard Business Review (Nov-Dec

vard Business Review (Sept-Oct 1985). 1988). Mintzberg, Henry, Five Ps for Strategy. California Management Review

(Fall 1987). Sanderson, Susan, and Uzumeri, Vic, Strategies for New Product De- velopment and Renewal: Design-Based Incrementalism, Center for

Mintzberg, Henry, Generic Strategies: Toward a Comprehensive Frame- Innovation Management Studies report, Lehigh University, 1990. work, in Advances in SLrategic Management, vol. 5. JAI Press, Green- wich, CT. 1988. Schlie, Theodore W., The Role of Technology in Influencing the Inter-

Monden, Yasuhiro, Toyota Production System: Practical Approach to national Competitiveness of Specific U.S. Industries, in Transform- Production Management, Industrial Engineering and Mangement ing Scientific Ideas Into Innovations: Science Policies in the United States Press, 1983. and Japan, Japan Society for the Promotion of Science, 1985.

Documents

Advanced Manufacturing and New Directions for Competitive Strategy