International Management Journals

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International Journal of Applied Operations Managment

Volume 1 Issue 2

Factors Affecting the Strategic Role of Manufacturing:

A Conceptual Framework Based on Hayes and Wheelwright
Four Stage Model

Dr. Ahmed N. Al-Rasby

Sultan Qaboos University
College of Commerce & Economics
Muscat, Sultanate of Oman
ISSN 1744-8182
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International Journal of Applied Operations Management: Volume 1 Issue 2

Abstract
The four-stage model was proposed by Hayes and Wheelwright (1984). It has
achieved widespread acceptance, however there is little research that has examined
the underlying factors of the model. This paper attempts to identify these factors, and
how are they are interrelated.
Five factors were identified that affect the strategic role of manufacturing. They are
the attitude of top managers towards manufacturing, the involvement of
manufacturing managers in setting the strategic direction of the firm, formulating
manufacturing strategy, manufacturing proactiveness and co-ordination between
manufacturing and other functions
The five factors affect the strategic role of manufacturing both directly or indirectly,
however the two key factors are the attitude of top managers towards manufacturing
and the involvement of manufacturing managers in setting the strategic direction of
the firm. They enable the other three factors to influence strategic role of
manufacturing.
Future research is required to test whether the factors adequately cover the domain
of all possible effects of manufacturing effectiveness. Additionally, In order to verify if
factors should be combined, future research could test the factors for construct
validities. Further research is also needed to test the framework empirically by finding
indicators that operationalise the factors.
Keywords: manufacturing strategy, strategic role of manufacturing strategy,
manufacturing proactiveness, manufacturing effectiveness, manufacturing managers,
unobservable variables and causal relationships, Hayes and Wheelwrights four
stage model.

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Introduction
The four-stage model was proposed by Hayes and Wheelwright (1984). It describes
the possible strategic roles of manufacturing within organisations. The model has
achieved widespread acceptance and reached classic status (Sower et al, 1997). Its
attractiveness is due to its simplicity and face validity, however as Barnes and
Rowbotham (2004) have noted, it is unclear from the published sources how an
organizations operations are classified in accordance with the four-stage model.
This was recognized before by Wheelwright and Hayes (1985) when they stated that
"a given operation may be - and often is - composed of factors that are themselves at
different levels of development. What determines the overall level of the operation is
where the balance among these factors falls".
Therefore, in order to look at the "balance" between the factors, it is imperative first to
delineate these factors. However, from the most current review of manufacturing
strategy literature (Dangayach and Deshmukh, 2001) and other subsequent
research, it is evident that many authors have cited the Hayes and Wheelwright fourstage model but without deliberately isolating the main factors that are the driving
force for strategic role of manufacturing and how these factors are interrelated.

Background
Hayes and Wheelwright (1984) suggested that even though the strategic role of
manufacturing is developed along a continuum, there are four stages that are
identifiable, which can reveal the firms position and the required transformations in
order to move it to the next stage or to keep it from sliding to a lower stage. At one
end of the stages, production offers very little support to a firms success, whereas at
the other end it contributes significantly to the competitive advantage of the firm.
To summarise the four stage model, firms in stage one and two can be characterised
as having reactive strategies. For stage one firms, manufacturings negative potential
is minimised and neutralised so that it does not hinder efficiency and cost
effectiveness. Manufacturing managers have no role to play in the strategic
management of manufacturing; hence experts are called in when there are strategic
decisions to be made. Manufacturing performance is monitored through internal
management control systems. The ultimate objective is to ensure that manufacturing
is kept flexible and reactive.
Stage two firms go beyond the steps taken by stage one firms and try to neutralise
competitors for any competitive advantage they may have. This is done by following
industry practices. The planning horizon for manufacturing decisions is extended to
contain a single business cycle, and capital investment is seen as the principal
method for achieving a competitive advantage.
For stage three firms, the responsibilities placed on manufacturing are significant in
comparison with the first two stages. Manufacturing has to provide support for the
firms competitive strategy. Investments in manufacturing are screened to make sure
they are consistent with the objectives of the business strategy. Any changes in the
business strategy are translated into manufacturing implications. Issues related to
long-term manufacturing developments and trends are methodically addressed.

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The fourth stage gives manufacturing a central role in the formulation and
implementation of competitive strategies. Thus, manufacturing-based competitive
advantage is sought. Efforts are made to predict the potential of new manufacturing
practices and technologies. The involvement of manufacturing goes beyond its
traditional domain to include the participation in major marketing and engineering
decisions. In order to acquire capabilities in advance of needs, stage four firms
pursue long-range programs.
For an up-to-date discussion of the background of the four-stage model and a
literature review of some empirical research that are based on the model, readers are
referred to Barnes and Rowbotham (2004).

Research Question
With the exception of few studies (Hum and Leow, 1992; Hum and Leow, 1996;
Barnes and Rowbotham, 2004), there is little follow-up research to critically examine
the underlying factors of the model. Accordingly, this paper attempts to identify these
factors, how they interrelate and provide some examples that demonstrate how some
companies have achieved some of these underlying factors.
Two broad research questions are addressed in this paper:
1. What are those factors that Hayes and Wheelwright (1984) have stressed as
key components of the strategic role of manufacturing?
2. How are these factors interrelated?

Factors Affecting the Strategic Role of Manufacturing

To address the first research question, the factors of a strategy concept can be
derived in two ways (Venkatraman, 1989):
1. By specifying the factors a priori, that is developing the factors beforehand
based on the conceptual perspective of the construct definition. This prespecification of the factors is then validated statistically using data analytic
methods.
2. The other way is to uncover the factors a posteriori. That is done analytically
with such techniques as exploratory factor analysis. This approach is
recommended when there is little or no theoretical foundation for a priori
specification. However, it has two main limitations as Venkatraman (1989)
pointed out. The first one is that the factors derived may be meaningless and
thus studies based on this method may not be repeatable. The second
limitation is that the method of data analysis used like exploratory factor
analysis may take the central role in the development of the model.
The a priori method is utilised in this research because even though Hayes and
Wheelwright (1984) did not make the factors that affect the strategic role of
manufacturing explicit in a systematic way, they did, however, point to them when
they were describing the characteristics of the four stages. These factors are the
following:

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1. The Attitude of Top Managers Towards Manufacturing

This factor was expressed many times during the discussion of the four stages. For
example, Hayes and Wheelwright (1984) suggested that for stage one firms, top
managers try to minimise their involvement with, and thus their perceived
dependence on, manufacturing. A practical example that signifies the involvement of
top managers is the empirical study carried out by Lefebvre and Lefebvre (1992) in
74 small manufacturing firms in the plastics industry. They found a positive
relationship between the involvement and influence of chief executive officer (CEO)
and the degree of process innovation.
Besides their attempt to minimise their involvement and dependence on
manufacturing, Hayes and Wheelwright (1984) observed some negative aspects that
are associated with the attitude of top managers towards manufacturing. For
example, they consider manufacturing to be incapable of influencing competitive
success. They encourage manufacturing to follow blindly industry practice in matters
regarding the work force, equipment purchases, and capacity additions without
understanding how manufacturing can provide competitive advantage. Their broad
and uncritical views of manufacturing lead them to consider economies of scale
related to the production rate as the most important source of manufacturing
efficiency, and consequently they regard resource allocation decisions as the most
effective means of addressing the major strategic issues in manufacturing. In
summary, they think the best way of solving a manufacturing problem is to throw
money at it and hope that it will go away.
Such negative and blurred view of the importance of manufacturing in gaining
competitive advantage for a firm is usually associated with companies in stage one or
two of the four stages framework. In higher stages, however, manufacturing is
considered as a competitive weapon, and is treated as such.
In stage three and four firms, top managers communicate frequently with
manufacturing managers to understand the problems facing them and how they can
be solved. Such positive attitudes of top executives can have profound
consequences on the way employees perceive their roles within a company. For
example, the CEO of Apogee Enterprises Inc., a manufacturer of glass, windows and
related products in the US persisted on instilling pride in every employee at the
company, and strived to set high performance expectations for them. In order to
achieve that goal, he gave them the freedom and support to conduct their duties and
he recognised and celebrated success. The managers of Apogee's various divisions
were also empowered to make their own decisions. The CEOs objective was to
make employees feel like owners of the company, not just workers (Brewer, 1995).
Another CEO of a major industrial supplier of aerospace systems and automotive
parts commented that one of the top managements significant role is to coach
people to win. That involves focusing on long term development of human
resources. Such a focus will guarantee the provision of best-prepared employees to
his company (Tichy and Charan, 1995).

2. Involvement of Manufacturing Managers in Setting the

Strategic Direction of the Firm
Hayes and Wheelwright (1984) noted that one of the characteristics of stage three
firms is that manufacturing managers take a broad view of their role by seeking to
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understand their companys business strategy and the kind of competitive advantage
it is pursuing.
In their study of the role of manufacturing, Rafii and Miller (1994) identified
communication of the firms competitive strategy to its manufacturing function as a
prerequisite for the integration of manufacturing into the corporate mainstream. This
communication can only be attained if the manufacturing managers are involved in
strategy discussions with their superiors. Swamidass and Newell (1987), in an
empirical study, used path analysis to conclude that the role of manufacturing
managers in strategic decision making positively influences performance.
However, such a positive involvement of manufacturing managers is not apparent in
lower stages. Hill (1993) observed that manufacturing managers view their roles as
being only reactive to the demands placed on the production system. Whenever they
have the chance to involve in corporate strategy debates, they do not explain
manufacturing strategy issues effectively. Their involvement in corporate policy
debates, very often, comes late when the decisions have already been agreed upon,
so they have little chance of changing the decisions that can negatively affect
manufacturing.
This lack of confidence and involvement from the part of manufacturing managers is
due, among other things, to their lack of education and training. Research studies
(e.g., Oakland and Sohal, 1989; FaForge and Bittel, 1983) have indicated that the
usual career path for manufacturing managers starts when they leave school at the
age of 16 to begin manual work on the shopfloor. They progress to become
managers without the needed exposure to the essentials of operations management.
Moreover, Hayes et al. (1988) found that part of the reason manufacturing managers
are not involved in shaping corporate policies is that because they spend most of
their time in dealing with routine operational matters. They just do not have adequate
knowledge of how to view their roles from a strategic perspective. One method that
can give manufacturing managers the opportunity to spend more time in strategic
issues is through delegating some operational responsibilities to the shopfloor. This
is what the director of facilities operations at G. D. Searle & Co. did. He used the time
which would usually be spent on day-to-day running of operations on bolstering the
pharmaceutical companys bottom line through finding ways of saving time and
money for the various functions in the firm. He managed to locate areas where there
is scope for savings like the introduction of an in-house networked electronic printing
facility, and the monitoring of the heating, ventilating, and air-conditioning system by
technicians from their homes via lap-top computers. Such programmes would not
have materialised if the director of facilities operations was concentrating his time on
day-to-day operational matters (McMillan, 1994).
The importance of getting manufacturing managers involved upfront in business
strategy is summed up by Samson and Sohal (1993) who noted that manufacturing
managers must become more than just implementers of engineering and marketing
instructions on the shopfloor. Raising the status of the manufacturing function
involves getting the manufacturing manager involved in the business development/
market competitiveness debate. Manufacturing managers need to be interfaced with
and have an understanding of the firms customers (p. 220).

3. Formulating Manufacturing Strategy

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According to Hayes and Wheelwright (1984), this factor is absent in stage one and
two firms, whereas stage three firms formulate manufacturing strategy complete with
plant charters and mission statements to guide manufacturing activities over an
extended period of time (p. 102).
The importance and significance of developing manufacturing strategy is illustrated
by Firestone New Zealand Ltd. When the tyres industry was deregulated, Firestone
NZ found itself faced with increased competition from cheap imported tyres. To
survive, the company had to re-establish its market leadership through competing
effectively on both quality and price. Firestone NZ managed to survive and expand
through the development of a strategy comprising a set of well co-ordinated
objectives and action programmes aimed at securing a long-term sustainable
advantage over competitors (Paul and Suresh, 1991, p. 233). This example supports
the empirical studies of Marucheck et al. (1990) and Tunalv (1992) who found that
firms which have developed manufacturing strategies are substantially more
successful than firms without one.
For firms that do not have clear manufacturing strategies, they usually seek the help
of outside experts to tackle strategic issues involving manufacturing (Wheelwright
and Hayes, 1985).
Strategy can be deliberately formulated or it can be emergent (Mintzberg, 1987). In
either case, what is important is the consistency of decisions taken. This view is
stressed by Hayes and Wheelwright (1984) who noted that It cannot be
overemphasised that it is a pattern of decisions actually made, and the degree to
which that pattern supports the business strategy, that constitutes a function's
strategy, not what is said or written in annual reports or planning documents (p. 30).
Similarly, Mintzberg and Waters (1982) argued that conceiving strategy in terms of
intentions means restricting research to the study of the perceptions of what those
who, it is believed, make strategy intend to. And that kind of research- of intentions
devoid of behaviour- is simply not very interesting or productive (p. 465). Their
argument is that if realised strategies are viewed as pattern in a stream of decisions,
then strategies can be regarded as consistencies in the behaviour of firms.
Consistency in decisions requires that each time a decision is considered it must be
scrutinised before it is implemented. Hayes and Wheelwright (1984) noted that stage
three firms screen decisions to be sure that they are consistent with the
organisations competitive strategy.
The importance of screening decisions to make sure that they are consistent with
corporate strategy is demonstrated by Cincinnati Milacrons Plastics Injection
Machinery Business plant in Batavia, Ohio (Teresko, 1994). This plant developed a
strategy which called for reduced lead-times. The production department responded
with redesigning its products into modules. That resulted in a production concept
where products are manufactured in parallel instead of the old linear and sequential
method of production. The outcome was a drastic reduction in lead-times.
The significance of screening decisions is emphasised by Wheelwright (1984) who
observed that a competent manufacturing function is not ultimately one that assures
the highest efficiency, or maximum productivity, but it is rather the one that aims for
consistency between the requirements of the business strategy and its policies and
capabilities.
Decisions concerning capital investments are probably the most important decisions
that face manufacturing managers. How such decisions are considered and analysed
is indicative of the way other decisions are contemplated. There are two approaches

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for considering capital investments decisions. The first one is the normative approach
which emphasises financial considerations alone and does not view the strategic
aspects of a potential project as significant (Pirttila and Sandstrom, 1995). This
approach looks at capital investment from a purely profit maximising perspective. The
other approach, called the process approach, integrates behavioural considerations
into the capital budgeting process. The emphasis is both on the financial outcome of
an investment and how it is going to contribute to manufacturing capabilities like
quality and flexibility. Hayes and Wheelwright (1984) suggested that firms in higher
stages incorporate nonfinancial considerations in their capital budgeting process.
Performance measurement and analysis of the outcomes of manufacturing decisions
are important, just like the analysis of the appropriateness of these decisions before
they are executed. Some manufacturing firms, however, employ very detailed
measurements and controls of their operating performance. In this respect, Thackray
(1990) noted that one of the differences which distinguish Japanese manufacturing
industries from their British counterpart is the absence of rigid control systems.
Whereas British firms have a dilemma in that every improvement made has to be
seen as a major step, the Japanese implement a continuous improvement
philosophy through giving their people the scope and freedom to look for solutions
without the strictness of control systems impeding their efforts.

4. Proactiveness
Hayes and Wheelwright (1984) noted that one of the characteristics of stage three
firms is that they are on the lookout for longer term developments and trends that
may have a significant effect on manufacturings ability to respond to the needs of
other parts of the organisation (p. 102).
They also suggested that stage four firms anticipate the potential of new
manufacturing practices and technologies and seek to acquire expertise in them long
before their implications are fully apparent (p. 103).
Ward et al. (1994) investigated this factor and suggested that proactiveness is an
important characteristic for identifying manufacturing functions that offer strategic
benefit to the firm and those that do not (p. 338). They operationalised
manufacturing proactiveness as being caused by manufacturing involvement and
capability building programmes.
One important aspect of proactiveness is seeking new opportunities related to the
present operations. These new opportunities can mean acquiring technology which
can have a positive effect on competitive capabilities. It can also mean finding ways
to increase market presence or maintain market leadership. With respect to acquiring
technology, this can usually imply the complex task of locating an entirely new
technology and introducing it into manufacturing. An important issue in this process is
personal relationship. So in order to expedite this process, Deere & Co. initiated
since 1990 a technology acquisition programme which it called People Who Know
for uncovering relevant technology or even finding that piece of information that can
be useful in process improvement. The benefits from this programme for Deere &
Co., which culminated in acquiring a variety of technologies, have significantly
surpassed the cost of having to pay for staff associated with the programme
(Boardman, 1995).

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With regards to increasing or maintaining market leadership, Allen Bradleys

Industrial Control Group division realised that the market for its products would
increase by 1700% between 1988 and 1992. This was an opportunity for it to expand
its present operations. Otherwise, if it was not ready, there was a chance that other
suppliers would fill the gap. Allen Bradley toured many best-in-class electronics
manufacturers to help it develop its strategic response to the market expansion. It
then decided to build a new facility that has helped it fulfil its goals and at the same
time reduce the time-to-market shipments of new equipment by 85% (Jasany, 1992).
The contribution and significance of this CIM facility, which is called EMS1 (Electronic
Manufacturing Strategy), is so enormous that it was described by a senior manager
at Allen Bradley as not a facility, but a capability (McKenna, 1992).
Proactiveness also involves taking some risks when making decisions. Risk taking is
a virtue which can take place at any level of management as well as at the shopfloor.
For example, Neff (1995) suggested that there are twelve important traits for todays
CEO; one of them is good judgement anchored by prudent risk taking. Story (1995)
noted that part of the failure of empowerment programmes is due to management not
encouraging employees to take risks.
If a firm wants to become a learning organisation, according to Kline and Saunders
(1995), then it has to follow ten steps; among them is rewarding risk taking. The
importance of risk taking for achieving a learning organisation is similarly advocated
by a roundtable discussion of industry panellists who agreed that a climate of risktaking is necessary if employees are to learn effectively (Chief Executive, 1995).
Brown (1995) postulated that there are ten 'commandments' for managing firms
toward the millennium, one of which is understanding the value of risk taking. Risk
taking is also an important characteristic for teams (Temme, 1995). It increases in
individual members their alertness and self-awareness (Supervisory Management,
1995).
One research study (Krueger and Dickson, 1994) found that managers who believe
in themselves and consider themselves competent see more opportunities and take
more risks. The reverse is true for non-competent managers. Motorola Inc. managed
to challenge its Japanese competitors by its aggressiveness and risk taking
approach. That emphasis was stated by the chairman of Motorola who believed that
the key to success depends on manufacturing firms readiness to take major risks
(Murray, 1989).
A proactive manufacturing function must also, as Hayes and Wheelwright (1984)
indicated, forecast the potential of new practices and technologies and try to obtain
them even before their significances are clear.
An example of firms anticipating the potential of new technology is Toshiba, the
Japanese electronics goods manufacturer, whose managers target market
opportunities and generate product specifications that draw initially upon emerging or
even non-existent technology (Herbert, 1989).

5. Co-ordination between Manufacturing and Other Functions

This factor is more apparent in stage four firms where there are extensive formal and
informal horizontal interactions between manufacturing and other functions that
greatly facilitate such activities as product design, field service, and sales training.
(Hayes and Wheelwright, 1984, p.103)

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One aspect of co-ordination between manufacturing and other function is the

interactive development of business, manufacturing, and other functional strategies.
Such a co-ordination can become the difference between the survival and demise of
a firm. Storage Technology Corporation in Louisville, Colorado is a manufacturer of
information storage and retrieval subsystems for high-end computer systems. It went
into Chapter 11 [protection of bankrupt companies from creditors in the US during
their attempt to restructure] in the mid 1980s. It then decided to form a crossfunctional team to formulate cohesive corporate strategy. The team managed to get
the involvement and commitment of top managers which consequently helped it to
emerge from bankruptcy quickly (Stratton, 1991).
Another aspect of a co-ordinated effort between manufacturing and other functions is
the continuous interaction among these functions to facilitate product design, field
service, and sales training. 3Ms life-sciences complex in St. Paul, Minnesota is an
example of the interaction between manufacturing and other functions to help a firm
in its product design. 3M produces thousands of various products from abrasives to
image processing systems. At one point, most of the companies it used to supply
were deep in recession. However, being a leader in its markets, 3M recession
strategy was to carry on doing what it does best, that is innovating and designing
new products. To achieve that goal, it decided to form cross-functional teams from
manufacturing and other departments which managed to clear the obstacles in the
way of the flow of technology around the company and thus enhanced innovation
and product design (Economist, 1991).
Co-ordination between manufacturing and other functions can also be set up for the
purpose of transferring know-how among the functions. However, transfer of know
how can also take place within various manufacturing departments in large and
diversified firms. For example, one of the duties of the corporate director of
manufacturing systems in Motorola Inc. was to act as a matchmaker between various
departments and groups that needed a particular technology and others that could
provide it (Horwitt, 1990).
Another example of within-function co-ordination is Bibby Sterilin Ltd., a British
manufacturer of health care products which focused its manufacturing by five product
groups. Each product group was assigned a team to develop a strategy relevant for
its product portfolio. Afterwards, in order to promote communication and coordination, the teams were brought together to allow for cross-fertilisation of ideas
among them. The co-ordination among the teams resulted in the agreement on
common issues such as the necessity of product strategy to precede automation
decisions and the need for consistency between short-term decisions and long-term
plans (Bodnar and Harrison, 1991).
Also co-ordination can extend beyond a firms boundary to include its suppliers.
Hayes and Wheelwright (1984) noted that for stage one firms manufacturing
operation can appear clumsy and unprepared when confronted with such
straightforward tasks as . helping suppliers solve problems (p. 101).
Honda of America Manufacturing Inc. is an example of a firm which considers
suppliers as strategic to the success of its business because 80% of the cost of a
Honda automobile is purchased from outside suppliers. For that reason, Honda
strives to develop its suppliers and make them adopt its systematic approach of
reducing costs, increasing quality, and developing leading-edge technology
(Fitzgerald, 1995).

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How the Factors are Interrelated

To address the second research question, a conceptual framework is developed
which shows how the factors are interrelated. A conceptual framework is a theoretical
model that attempts to explain real-world phenomena by expressed relationships
among concepts (Blalock, 1969). The concepts, or factors as they are called in this
paper, are in themselves not observable but are latent in the phenomenon under
study (Straub, 1989). So, before addressing the second research question, two
theoretical considerations which have implications on the framework are first
discussed. These are the use of unobservable variables, and the utilisation of causal
analysis to represent relationships between concepts.

Unobservable Variables
The nature and applicability of unobservable [or latent] variables have been
scrutinised in many disciplines, but none more so than in the literature of the
philosophy of science which has witnessed fierce debates concerned with this issue
(Boyd, 1991). Most of these debates are between two schools of thought; the logical
positivists and the realists. The logical positivists contend that one can never be
certain of the existence of unobservables. Thus, according to this school of thought,
theories that contain unobservables should not be judged on the basis of their
correspondence to reality, but instead on their instrumental value as tools for
generating predictions about the behaviour of physical, natural, and social systems
(Godfrey and Hill, 1995, p. 520).
The opposing school of thought, represented by the realists, argues that knowledge
gained from scientific endeavours can point to the existence of unobservable entities.
The argument used by the realists is that when a theory that contains unobservable
entities is well corroborated by scientific evidence, then we may have good reason
for believing that those unobservable entities have a correspondence in reality.
Thuswe can make statements about the truth value of theories that contain
unobservables (Godfrey and Hill, 1995, p. 520).
These debates between the logical positivists and the realists have significant
implications for strategy research because most of the theories that are addressed in
strategic management contain concepts that are unobservables.
The logical positivists have been criticized because of their inability to explain such
theories as quantum physics which are based on unobservable entities. Thus the
views of the realist position is adopted in this research, because this school of
thought argues, according to Godfrey and Hill (1995), that since our theories can
give us knowledge about unobservables, it is legitimate to derive normative rules
from those theories that can be used to guide managerial action (p. 520).

Causal Relationships
The second theoretical consideration, which is an extension of the first one, is the
assumption of causal relationships in models involving unobservable variables.
Causality has been debated in many disciplines. However, there is no consensus on
its meaning and nature. Bollen (1989) argues that there are three components or
conditions for causality. They are isolation, association, and the direction of influence.

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If, for example, there is a cause and effect relationship between two variables such
that x is a cause and y is an effect, then isolation means all the effects on y are due
to x alone. That implies y is totally isolated from being affected by other variables.
Association between two variables like x and y means that they covary and correlate
with one another. The last condition for causality is knowing the direction of influence.
That is x influences y and not vice versa.
About these three conditions for causality, namely isolation, association, and
direction of influence, Bollen (1989) noted that each condition is difficult to meet, but
it is perhaps impossible to be certain that a cause and an effect are isolated from all
other influences. We must regard all models as approximations to reality (p. 79).
The concerns introduced by using latent concepts in a theoretical network, by
implying causality, does not stop with what has already been pointed out. The critical
issue is that whatever statistical analyses are used to test a model, it can never be
proven. The reason behind this as Bagozzi and Phillips (1982) pointed out is that
because the non-observational hypotheses of a theory are not restricted to particular
space or time locations, the number of times a particular effect could be observed is
potentially infinite. As a result, no matter how many positive observations are
obtained in support of a theory, the certainty of the theory is still in doubt (p. 467).
That is why the only way to accept a theory tentatively is to subject it to rigorous tests
repeatedly until it has accumulated enough evidence for its support or it is
superseded by better theories. There is obviously a need for a tradition, in
manufacturing strategy, of building theories in a cumulative basis.

Conceptual Framework of the Strategic Role of Manufacturing

The brief discussion of latent variables and causal relationships is utilised to
construct the conceptual framework of the strategic role of manufacturing.
It can be observed, from Figure 1, that the five factors affect the strategic role of
manufacturing both directly or indirectly. The two key factors in the framework are the
attitude of top managers towards manufacturing and the involvement of
manufacturing managers in setting the strategic direction of the firm. They enable the
other three factors to influence strategic role of manufacturing. That is because
without the involvement and direction of the two levels of management, it is difficult, if
not impossible, to create an atmosphere that lets manufacturing and other functions
co-operate in such issues as strategy development and product design. Also,
manufacturing managers cannot be confident to take risks and be proactive to
acquire new, but yet unproved, practices and technologies without having in the first
place the opportunity to know the kind of competitive advantage the firm is pursuing.
Such involvement will also allow manufacturing managers to emphasise more on the
development of manufacturing strategy. Thus, the first two factors are the basic
requirements for any strategically effective manufacturing function. Without them it is
inevitable that the development of this effectiveness will be at risk.
Figure 1: The Conceptual framework showing interrelationships amongst factors
affecting the strategic role of manufacturing

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The attitude of top managers towards manufacturing can also affect the involvement
of manufacturing managers in strategy debates. If top managers show interest in
manufacturing, then that will encourage manufacturing managers to know more
about business strategy and the type of competitive advantage it is pursuing.
Top managers can also influence the relationships between manufacturing and other
functions. If they show interest in manufacturing, then it is very conceivable that they
will encourage it to communicate with other functions in such matters as the
development of strategy and product development.
Also, the involvement of manufacturing managers in setting business strategy, which
is the other key variable, is very important in the sense that it allows the managers to
know exactly what is required of manufacturing as a function in its contributions
towards the execution of business strategy. That necessitates that manufacturing
managers take a leading role in the efforts of co-ordination between manufacturing
and other functions.

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Likewise, if top managers show interest in manufacturing and the manufacturing

managers are involved in business strategy development, then it is inevitable that
they must formulate a functional strategy for manufacturing.
The breadth and depth of knowledge gained from the involvement in business
strategy development will also lead manufacturing managers to be more proactive in
their methods of acquiring new technologies and manufacturing practices even
before their importance is fully apparent. Moreover, the emphasis on formulating
manufacturing strategy can contribute to the proactiveness of manufacturing.

Discussion and Recommendations for Further Research

This paper represents an attempt to delineate the factors that affect the strategic role
of manufacturing as emerged from the work of Hayes and Wheelwright (1984). It is
worth pointing out that with respect to the a priori specification of these factors, there
are two points to be made which are concerned with comprehensiveness and
parsimony. The first point is whether these factors adequately cover the domain of all
possible effects of manufacturing effectiveness. The second point is whether they are
distinct from one another.
Regarding the first point, even though one cannot argue that these factors cover all
the possible antecedents that can affect the strategic role of manufacturing, it is
contended here that the five factors derived represent the important themes
associated with manufacturings role in gaining a competitive advantage for a firm.
They have been stressed in various contexts in the literature as being significant in
upgrading manufacturing effectiveness. However, Future research could examine the
factors critically and extend the framework to include other factors if necessary.
As for the second point regarding the distinctiveness of the five factors, it can be
argued, for example, that two of the factors, namely, (1) the attitude of top managers
towards manufacturing, and (2) the involvement of manufacturing managers in
setting the strategic direction of the firm, represent two aspects of the same
underlying factor which can be called communication between manufacturing and
top management. However, the literature of manufacturing strategy does not provide
convincing arguments that would suggest combining such factors.
Thus all factors are delineated individually at this stage. In order to verify if factors
should be combined, future research could test the factors for two types of construct
validities, namely convergent and discriminant validities. These tests should provide
support if the dimensions are distinct or if they converge towards one another and
therefore should be combined.
Further research is needed to test the framework empirically by finding indicators that
operationalise the factors.

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