Linking plant roles and operations strategy decision-making autonomy in international manufacturing networks

Abstract

This paper is concerned with the management of multi-plant manufacturing networks. Two key concepts in this domain are plant roles and plant autonomy in the context of operations strategy decision-making. We investigate the relationship between these two concepts and their impact on plant performance. We use data from 102 manufacturing plants belonging to multi-plant networks. The results suggest a relationship between plant roles and operations strategy decision-making structures. Plants with high levels of decision-making autonomy typically have high levels of production, supply chain, and development competences, while plants with a low level of decision-making autonomy are primarily those with only production site competences. Integrated structures for operations strategy decision-making, which include both the network level and the plant level, exist for all plant types and are thus not restricted to plants with a certain set of site competences. In accounting for both the plant type and decision-making structure, we were unable to detect any significant differences between groups in terms of performance effects. Instead, it seems that the fit between plant type and decision-making structure is important and that choosing the right type of operations strategy decision-making structure moderates the performance of plants with low site competence levels.