Page 111 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Logistics and Supply Chain Management

Notes Self Assessment

State whether the following statements are true or false:
9. Manufacturing has become familiar as an important element of corporate strategy.
10. Integration in similar aspects has become a key issue and must be replicated in
manufacturing strategy.
11. Concept of lean production has taken birth from China.
12. Manufacturing objectives cover such things as cost, quality, delivery and flexibility and
usually there are trade-offs between them.

5.4 Manufacturing Strategy

Since the 1980s the phrase “manufacturing strategy” has become increasingly common. There is
some confusion in terms of both when and where manufacturing strategy appears in the overall
strategic planning process of the firm. It has been asked whether manufacturing strategy has
been replaced by concepts such as JIT and TQM. Managers often find it hard to tell the difference
between programs such as JIT and manufacturing strategy.
Two definitions seem to sum up best what manufacturing strategy is,

(a) “Manufacturing strategy consists of a sequence of decisions that over time, enables a
business unit to achieve a desired manufacturing structure, infrastructure and set of specific
capabilities.”
—Hayes and Wheelwright, 1984
(b) “Manufacturing strategy is viewed as the effective use of manufacturing strengths as a
competitive weapon for the achievement of business and corporate goals.”
—Swamidass, 1987
Manufacturing strategy will be related to three adjacent concepts:
(a) Manufacturing mission, which may establish a link to corporate strategy;

(b) Manufacturing concept, which will provide an overall, integrated picture of how
manufacturing is intended to be in the future; and
(c) A manufacturing implementation plan, which will indicate the chosen rate and scope of
change.
Thus we can define manufacturing strategy as a pattern of decisions, both structural and
infrastructural, which determine the capability of a manufacturing system and specify how it
will operate to meet a set of manufacturing objectives which are consistent with overall business
objectives.
5.4.1 Formulation of Strategy

Let us understand the basic steps in analysing existing manufacturing activities and reviewing
current manufacturing strategy.

A manufacturing strategy is a working document which outlines the basis for competitive
advantage, the key issues which will affect the organisation, the strategic manufacturing aims
and the broad strategic initiatives to be pursued. Not all manufacturing companies have a
manufacturing strategy, but, most organisations operate with a business plan and a broad

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