Process Range in Manufacturing: An Empirical Study of Flexibility

This paper examines the relationship between one form of manufacturing flexibility---process range---and structure, infrastructure, and managerial policy at the plant level. The paper provides evidence of the strength of the links between manufacturing flexibility and such factors as scale, technology vintage, computer integration, and workforce management. Data from 54 plants in the fine-paper industry are presented, and a model of the determinants of short-term flexibility is developed. The plants examined differed by a factor of 20 in their ability to accommodate large process variation. The evidence suggests that flexibility is strongly negatively related to scale and degree of computer integration, yet positively related to newer vintages of mechanical technology and workforce experience. Some results differ significantly from the prevailing view of the industry, in particular, that newer plants are less flexible. The paper shows that newer machine technology is more flexible once other factors are controlled for. In the longer term, the results show that management has a significant impact on the improvement of flexibility in operations, regardless of the technology and infrastructure in place. Plant network managers' views of flexibility are important. The data suggest that inflexible plants may be inflexible partly as a result of their being considered inflexible by network managers, and never being assigned the product range needed to improve the capability.