The quest for process operations variability reduction in manufacturing firms in South Africa

Abstract

In an era characterised by a volatile economy, intense competition, and rising energy and material costs, improving operational efficiency has become a necessity for margin purposes and long-term business success. This research study attempts to develop a model for process operations variability reduction that integrates the fundamental drivers, the intermediate measures and the four traditional competitive capabilities: quality, cost, delivery reliability and speed of delivery. In addition, it highlights the precise mechanisms in plants that lead to multiple competitive capabilities development. The concept of a routine-based approach to capabilities development provides a nexus between the earlier actions by the organisation and competitive advantage. Using longitudinal data from the Manufacturing Circle of South Africa, a statistical analysis was conducted to support the model, and path analysis models were developed which confirmed that the performance frontier is really a surface that spans many different dimensions. It is observed that the model clearly outlines pathways to process operations variability reduction through better execution of the routines concerned with maintaining the performance by current processes, improving existing processes, and transforming or changing to new processes.