Roles of Customers in Upgrading Manufacturing Firm Technological Capabilities Toward Industry 4.0

Abstract

This paper empirically examines the effects of customers who invested in Information and Communication Technologies (ICTs) on the technological capabilities of a firm for upgrading toward Industry 4.0. This paper focuses on three groups of firm technological capabilities such as production planning, inventory management, and data analysis. Each group consists of four levels of technological capabilities ranging from the fundamental to the most complex levels of technology usage. A hierarchical multiple linear regression method is used to analyze 141 respondents collected from the Thai manufacturing firms during March–April 2019. The results indicate that customers who invested in ICTs significantly and positively affect the technological capability upgrading of a firm in the groups of production planning, inventory management, and data analysis. However, there is no evidence to support that customers who invested in ICTs have positively affected firms to achieve the most complex levels of technology usage in these three groups. For the engineering implications, managers are encouraged to work closely with customers, especially customers with high technological capability. This could help a firm’s engineering teams to upgrade and catch up with customer technologies.