Evaluation of the fit between a firm's manufacturing structure and its business strategy: a methodology

Abstract

A diagnostic tool that determines the degree of alignment between a company's manufacturing structure and business strategy and between a company's product line and production processes is presented. The types of business strategies included in this methodology are based on an adaptation of Porter's 'generic' typologies. The generic business strategy followed by the firm under study is identified after surveying top management. Similarly, the manufacturing structure of the business is defined by analyzing manufacturing along three dimensions composed of several variables: process structure systematization, product line complexity, and organizational scope. Each of these dimensions is determined using quantitative and qualitative manufacturing structural measures (MSMs). The overall analysis of the MSMs yields a profile of the generic business strategy as reflected in the manufacturing structure. This profile is compared with the intended generic business strategy of the company, and the degree of fit between the two is determined. From there, a course of action to improve the fit can be determined. >