Is the global supply chain hard to reverse? Understanding manufacturing strategies of Chinese, Japanese, and South Korean Firms

Abstract

AbstractAs the Covid pandemic underscores global supply chain risks, there is a debate on whether to bring US manufacturing back from overseas. This paper provides insights into the heated debate on the global supply chain by examining the competitive manufacturing environments of China, Japan, and South Korea. More specifically, we conduct a cross‐national survey and empirically investigate the manufacturing strategies employed by manufacturing managers in the top Asian players: China, Japan, and South Korea. We examine four dimensions of the manufacturing strategies: quality, inventory, flexibility, and top management involvement. Our findings indicate that Japanese manufacturers are more committed to the cumulative approach to quality management and see enhanced flexibility as a strategic priority. While Chinese managers are also committed to achieving quality, they are more delivery‐driven and thus are more likely to occasionally accept slightly off‐quality components from suppliers to “save” an order. However, in all three countries, managers with a high focus on quality also focus on just‐in‐time management and in turn, on flexibility. There is significantly less agreement among Chinese managers, compared to their Japanese and Korean counterparts, that the top management should be involved in operational planning, goal setting, and the provision of rewards.