The link between modification flexibility and organizational objectives: an empirical study on Jordanian manufacturing companies.

Author:Awwad, Abdulkareem S.
 
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INTRODUCTION

It is heavily believed that flexibility plays a significant and important role in planning, implementing and controlling the both of manufacturing and operations strategy. Therefore, flexibility is considered as a strategic weapon in the arsenal of any manufacturing firm. It enables organizations to respond effectively and efficiently to changing circumstances, particularly, when dealing with uncertain business environments that are characterized by rapid changes, shorter product life cycles and increasing product variety. Therefore, manufacturing flexibility is emerging as a competitive weapon that should be considered as a result for many drivers of flexibility such as (the need to change product design, the need to shorten product life cycle, the need to adopt customization strategy and the need to cope with uncertainty such as uncertainly about machines, technology, customers' requirement and expectations). Moreover, flexibility is considered as one the competitive priorities that manufacturing companies should consider them when planning their operations and manufacturing strategy. These competitive priorities include: Cost, quality, delivery, productivity and flexibility.

Research questions: The central question of this study is: To what extent does the modification flexibility affect positively the achievement of organizational objectives in the Jordanian manufacturing companies?

Research objectives: Considering the research question mentioned above, the research objectives can be summarized as follows:

* To examine the influence of modification flexibility on the achievement of organizational objectives in the Jordanian manufacturing companies.

* To provide a better understanding for the link between modification flexibility and organizational objectives.

Theoretical framework and previous studies: Flexibility is characterized as a complex and multidimensional construct (34).

It means adaptiveness, responsiveness, agility, resilience, freedom, compromise, openness, adjustment, versatility, customization, elasticity and so on (36). Therefore, flexibility is classified into different categories using different perspectives. A summary of flexibility classifications is provided in Table 1.

Table 1: Classifications of flexibility Author(s)/Researcher(s) Flexibility (classification) dimensions Buzacott (4) Job flexibility is the ability of the system to cope with changes in jobs to be processed by the system. Machine flexibility is the ability of the system to cope with changes and disturbances at the machine and work stations. Sethi and Sethi (34) Basic flexibilities (machine, material handling, operation) System flexibilities (process, routing, product, volume, expansion) Aggregate flexibilities (program, production, market) Gupta and Somers (15) Structural flexibility "flexibility of the technology and human resources Infrastructural flexibility "flexibility of the systems, the procedures and the practices which integrate and coordinate the operations Chen et al. (8) Production flexibility, which includes the following types of flexibility: (machine flexibility, process flexibility, routing flexibility, manpower flexibility, material handling flexibility, programming flexibility). Marketing flexibility, which includes the following types of flexibility: (product flexibility, volume flexibility, mix flexibility, expansion flexibility). Infrastructural flexibility, which is the flexibility of the organization. Narasimhan and Das (25) Operational flexibilities (Machine/shop level): This level consists of the following dimensions (equipment flexibility, material flexibility, routing flexibility, material handling system, program flexibility). Tactical flexibilities (Plant level): This level consists of the following dimensions (mix flexibility, volume flexibility, modification flexibility) Strategic flexibilities (Firm level): This level consists of two dimensions (New product flexibility, Market/delivery flexibility). Oke (28) New product flexibility: The ability of a manufacturing system to introduce and manufacture new parts and products (27). Mix flexibility: The ability of the organization to produce different combinations of products economically and effectively, given a certain capacity (43). Volume flexibility: The ability of the organization to operate at various batch sizes and/or at different production output levels economically and effectively (43). The benefits of flexibility: Reviewing the literature on flexibility (14), (20), (21), (23), (29), (34), (39), (40) shows that flexibility offers the following benefits to organizations:

* Increasing sales volume, or preventing sales being lost, by making products more competitive (e.g. delivery, price, quality, product, specification);

* Increasing selling price, without a corresponding increase in product cost or loss of sales (e.g. charging a premium price for improved delivery);

* Eliminating unprofitable orders (e.g. by improving quotation system);

* Reduced inventory levels;

* Reducing product delivery times;

* Improving the reliability of delivery promises;

* Improving the ability to match product specification to customer needs;

* Reduction in scrap and rework that comes from eliminating set-ups;

* Improving delivery performance;

* Having a greater ability to cope with uncertainty;

* Managing manufacturing schedule fluctuations;

* Applying Just In Time (JIT)purchasing;

* Managing demand volatility, demand seasonality and forecast accuracy;

* Improving supplier responsiveness;

* Affecting positively a firm's performance;

* Enabling firms to fully explore various product definitions and ideas; and

* Allowing firms to gather customers' feedback and investigate design feasibility.

The need for flexibility: With regard to the role of flexibility in enabling organizations to cope with uncertainties, De Toni and Tonchia (10) argue that flexibility is needed due to the following factors (products: wideness of the range, number of parts; manufacturing processes planning and control, the variability of demand, shorter life cycles of products and technologies, increased customization, and shorter delivery times). Gupta and Somers (15) emphasize that companies need more flexibility when they decide to compete in the high end of markets on the one hand and to respond to competitors' actions on the other hand. Similarly, Wainwright and Bateman (40) argue that the need for flexibility is emphasized in response to changes associated with compression of product life cycles, increased product diversity and a reduction in customer lead times. A need for wider product scopes and the trend towards shorter product life cycles are some factors that make flexibility a top priority issue in manufacturing strategy (27). Similarly, (19) referring to (8), (10), (13), Correa (9) argue that the need for flexibility is linked to two groups of factors namely:

* Market-related factors: examples on these factors include (increased product diversity, short product life cycle, the variability of the demand, shorter life-cycles of the products and technologies, wide range of products, increased customization and shorter delivery times).

* Manufacturing-related factors: examples on these factors include (focused manufacturing, manufacturing technology innovation, unexpected competitors, uncertainty with respect to machine downtime, uncertainty of whether the material input meets the standards of the process, changes with respect to delivery times of raw materials and variations in workforce).

Organizational objectives: Objectives refer to what an organisation seeks to achieve through its existence and operation; it answers to the question, why are we in business? Organisations may have a variety of different objectives such as: growth in revenues, higher dividends, attractive economic value added, a bigger market share, high quality, lower costs relative to key competitors, and higher levels of customer satisfaction than rival (Thompson and Strickland (38). According to Steiner (35) preparing objectives should consider (suitability, measurability, feasibility, acceptance, flexibility, motivation, clearness...

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