Manufacturing strategy, business strategy and firm performance in a mature industry

Abstract This research investigates the relationship between manufacturing strategy, business strategy and firm performance in a mature industry. Past research is synthesized, and a parsimonious conceptual framework is developed. The framework is then tested on a sample of 85 firms in the broadwoven fabric industry (SIC 2211). The results show a significant relationship between the business strategy and the manufacturing strategy of the firm. They support the argument found in the literature that functional level strategies should support business level strategies. A significant relationship was also found between manufacturing strategy and performance of the firm. In particular, the manufacturing function's quality assurance process and its ability to deliver a quality product/service were found to correlate significantly with firm performance. Implications of the findings are discussed.

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