Is digital transformation equally attractive to all manufacturers? Contextualizing the operational and customer benefits of smart manufacturing

Abstract

PurposeThe implementation of Smart Manufacturing (SM) is deemed a key enabler in the enhancement of manufacturing competitiveness and performance. Nevertheless, SM's repercussion on consumer perceptions and the contextualization of SM's performance-enhancement effects remain undetermined and have yet to be clarified. This study analyzes the effect of SM on operational and customer performance. Moreover, this study explores how these relationships change depending on a firm's geography of production (i.e. national/local vs transnational operations) and the relational arrangement adopted (i.e. service-oriented vs transaction-oriented manufacturers).Design/methodology/approachThis research surveys 351 Spanish manufacturing firms operating in an SM environment. The theoretical framework comprises a Multiple-Indicators Multiple-Causes (MIMIC) model and is tested using a Generalized Structural Equations Model.FindingsThe results obtained substantiate the positive effect of SM implementation on both of the performance measures analyzed (i.e. operational and customer focused). Moreover, the study reveals that while geography of production moderates the effect on a firm's operational performance, relational arrangement also does so in terms of customer performance.Originality/valueThis research clearly differentiates the benefits of SM depending on business context. In this regard, transnational production firms tend to gain in operational performance while service-oriented manufacturers gain in customer performance.