استراتژی ساخت، استراتژی رقابتی و عملکرد شرکت: یک مطالعه تجربی در یک محیط اقتصادی رو به توسعه

This paper examines the relationship between manufacturing strategy and competitive strategy and their influence on firm performance. We test how competitive strategy influences manufacturing strategy and also examine the impact that manufacturing strategy and competitive strategy have on firm performance among Ghanaian manufacturing firms. We found significant and positive relationships between competitive strategy and the manufacturing strategies of cost, delivery, flexibility, and quality. The findings also indicate that quality is the only manufacturing strategy component that influences performance. Our results further show that although competitive strategy does not directly affect firm performance, it does so indirectly through quality. Thus, whether a firm chooses to pursue a cost leadership or a differentiation strategy an emphasis on quality provides the most benefits with regard to firm performance. An emphasis on quality appears to provide a means by which companies can mitigate the effects of increased competition resulting from the economic reforms within the Ghanaian manufacturing environment.

About 25 years ago, Skinner (1969) argued that managers needed to give serious thought to the role that manufacturing strategy could have on a firm's competitive abilities and the resulting effect on the firm's performance. Ever since that time, several papers have been written either testing the assertions of Skinner or refining the conceptualizations of Skinner's arguments (e.g. Swamidass and Newell, 1987; Gupta and Somers, 1996; Ward and Duray, 2000; Dangayach and Deshmukh, 2001a). However, one of the core underpinnings of Skinner's work, the examination of interrelationships among manufacturing strategy and competitive strategy has not received as much attention as it deserves in the manufacturing strategy literature. Skinner's argument was that while a company's competitive strategy places specific demands on the manufacturing function, at the same time the company's manufacturing strategy should be specifically designed to accomplish the goals of the company's competitive strategy. A firm's competitive strategy drives its manufacturing strategy leading to operations decisions that result in some desired performance. For the competitive goals to be accomplished the manufacturing strategy should be aligned with the firm's competitive strategy. Therefore, the goal of this research is to examine the relationships between competitive strategy and manufacturing strategy, and their effect on firm performance. Specifically, we examine the impact of cost leadership and differentiation strategies on delivery, flexibility, low cost, and quality manufacturing strategies. Additionally, we investigate the influence of cost leadership and differentiation strategies on firm performance, the impact of manufacturing strategy on firm performance, and further whether the alignment of competitive strategy with manufacturing strategy improves firm performance. This paper contributes to the existing knowledge on manufacturing strategy in several ways. We examine the alignment between manufacturing strategy and competitive strategy thus helping to understand how manufacturing capabilities should be adjusted to achieve corporate (or firm) objectives (Skinner, 1969; Anderson et al., 1989). There have been many studies linking operations strategy to business performance (Swamidass and Newell, 1987; Ward et al., 1994; Williams et al., 1995; Bozarth and Edwards, 1997; Vickery et al., 1997). However, with few exceptions (e.g. Badiri et al., 2000; Amoako-Gyampah and Boye, 2001; Dangayach and Deshmukh, 2001b; Zhao et al., 2006) most manufacturing strategy research has been confined to contexts involving developed economies where strategy implementation is perhaps well understood and practiced. In this study we examine the relationships between manufacturing strategy and competitive strategy in the developing economy of Ghana and their impact on firm performance. It is important to find out if Skinner's paradigm, which has been argued to be valid in developed economies, is also valid in the context of the developing economy of Ghana. If we can establish that existing theories on manufacturing strategy are also applicable in such an environment, it will enhance the robustness of those theories. In Ghana, most companies are now operating in an environment of western style management involving free market principles as opposed to government dominated policies of price controls, subsidies, and setting fixed exchange rates. At the same time, market-supporting institutions, access to capital, logistical infrastructure, the enforcement of contractual agreements between customers and suppliers, and managerial talent are all very limited. Therefore one cannot be sure if firms in Ghana have the means and know-how to effectively formulate and implement competitive and manufacturing strategies. We note that although our study is carried out in the same environment as that of Amoako-Gyampah and Boye (2001), it is different in that they studied the impact of business environment factors on operations strategy while in this paper we focus on how competitive strategy impacts manufacturing strategy and their subsequent effect on firm performance. Also, we hope to ascertain if the alignment of specific competitive strategies with a given manufacturing strategy (e.g. the combination of cost leadership and quality) appear to offer performance benefits over a pure competitive strategy and thus provide guidance to managers in Ghana and similar environments on ways to enhance their competitive abilities. Although the importance of aligning competitive strategy with manufacturing strategy has been verified in several studies (e.g. Ward and Duray, 2000), we are unaware of any study that specifically examines the relationship and its impact on performance in a developing economy environment. Although Ghana is a relatively small country its economic environment is similar to several other developing countries in Africa, Latin America, the Caribbean, and parts of Asia where former agrarian-based economies are now shifting to industrial and service-based economies. Most firms in these economies in the past operated in environments of limited competition, fixed currency exchange rates, price controls and government subsidies (Amoako-Gyampah and Boye, 1998). As firms in these countries integrate themselves into the world economy they find that multinationals and firms from larger emerging economies (e.g. India, China, Brazil) are also moving into their local economies and increasing the competition in the domestic market (Khanna and Palepu, 2006). Interestingly, these same conditions were faced by firms in India, as an example, in the early 1990s. The introduction of economic reforms in India resulted in increased competition from imports and from the multinationals in the domestic market (Dangayach and Deshmukh, 2001b). Thus, the increased competition brought about by market and economic reforms requires that companies in Ghana and similar environments not only have to develop appropriate strategies but they also need to understand how those strategies affect performance. In environments that are undergoing several changes, Hayes (1985) argued that building operations competence can be a means by which corporate strategy can be developed and leveraged to enhance performance. Thus, additional studies in developing economies are important and offer the potential to enhance our understanding of manufacturing strategy (Frohlich and Dixon, 2001; Zhao et al., 2006). The rest of the paper is structured as follows. First, we describe the economic environment in Ghana. Second, we review briefly our conceptualizations of competitive strategy and manufacturing strategy and the theoretical background for the study. Next, we present our hypotheses, followed by the research method. We then present the results and discussion of the results. The paper ends with our conclusions and suggestions for future research.

An important aspect of strategy development is the translation of firm level competitive strategies into functional strategies. We have demonstrated that even in less developed economies manufacturing strategy represents one of the means through which firm level strategic objectives can be achieved. We found significant relationships between competitive strategy and manufacturing strategy. Our findings confirm that all four manufacturing strategies (cost, delivery, flexibility, and quality) are means through which a firm can implement its competitive strategies. Of the four manufacturing strategy components, our findings indicate that only quality appears to influence firm performance. We did not find any direct relationship between competitive strategy and firm performance. However, competitive strategy influences firm performance through quality. Quality improves firm performance significantly regardless of which competitive strategy a firm chooses to emphasize. This is perhaps true because of the impact quality has on the other manufacturing strategy components. For example, improving quality can reduce manufacturing lead time, reduce amount of time spent on rework, the quantity of materials rejected, and thus contribute to improvements in flexibility, delivery times, and unit cost efficiencies. The literature on manufacturing strategy has noted that lasting improvements in performance is likely to be attained when those improvements are built on a solid quality foundation (Ferdows and De Meyer, 1990). In addition, it appears that the current economic environment favors an emphasis on quality compared to the other manufacturing strategy components. For example, the flood of imports into the Ghanaian market has made cost (or price) an order qualifier. In order to win orders quality must be emphasized. This is unlike advanced economies where quality is now considered to be an order qualifier. There is often the perception in Ghana that imports are of higher quality than locally produced goods. Therefore, a firm that emphasizes quality as part of the implementation of its competitive strategy is more likely to build a reputation (by changing those perceptions) and therefore able to gain market share and sales growth. The data collection for this study was confined to firms in Ghana, a developing country. However, the findings are consistent with those that have been obtained in more developed economies (e.g., Ward and Duray, 2000). In that sense the results are not only interesting but also unexpected. Firms in Ghana are relatively small. Most of them are wholly locally owned and over 45% of firms in our sample are family owned. Yet, our results suggest that manufacturing strategy is recognized as being important in the implementation of competitive strategy even in such environments. The expectation in the manufacturing literature is that aligning manufacturing strategy with competitive strategy will lead to enhanced performance. Based on our findings, we cannot refute those expectations. Although the alignment of competitive strategy with flexibility, delivery or cost did not lead to significant improvements in performance, the alignment of competitive strategy with quality leads to significant improvements in performance. Thus, it appears that firms in developing economies who are faced with increased competition brought about by trade liberalization and other reforms will benefit greatly from an emphasis on a quality strategy in combination with their selected competitive strategy. This is consistent with recent observations by Khanna and Palepu (2006) who noted that if domestic firms in emerging-markets improve the quality of their products, they are better able to compete successfully with multinationals. There are some limitations in this research. First, as indicated earlier, firms in Ghana are relatively small compared to firms in advanced economies. Thus, it is possible that these firms do not have the human capital to implement the different types of strategies discussed in this paper and limit their ability to achieve the intended benefits. We could not account for the potential impact of firm size on our results because about 75% of the firms have less than 100 employees. Second, we confined our study to manufacturing firms. It might be useful to include firms from the service industry in future studies to see if industry plays a role in the implementation of operations strategy and the realization of subsequent benefits. Even within manufacturing the limited number of firms in each sector did not allow us to ascertain differences between the different sectors. It might be interesting to know if different results exist depending on the industrial sector. Third, we studied only two performance measures, market share and sales growth. Although there is an expected correlation between our performance measures and profitability, including specific assessment of profitability in future studies will be useful. It is hoped that future research would seek to include other developing economy environments in Africa, Asia, Latin America and the Caribbean so as to strengthen our understanding of manufacturing (or the broader operations) strategy. If existing findings on manufacturing strategy can be replicated in other environments, it will strengthen the theories underlying those findings and enhance our understanding of manufacturing strategy and its impact on firm performance. Future research should include other functional strategies such as marketing and human resources and assess the joint contributions of these strategies to competitive strategy and firm performance.