Managing reverse logistics to enhance sustainability of industrial marketing

In this paper, a sustainable industrial marketing framework of latest requirement of green and sustainable operation is proposed. When literatures in strategy, marketing and operation have provided insight about the efficiency of reverse logistics and business value for the customer, the interrelationship is still under explored. This raises the question whether manufacturers could determine ecological friendly strategies to address their customer's environmental conscious needs and design the suitable solution to strike the balance between ecology and economics. Based on the case study of a medical product manufacturer, this study addresses this question by investigating how manufacturers identify the problem of reverse logistics; design and develop of sustainable product and service by enhancing the efficiency of operations, and market competencies that add value to their customers' business processes. Within the strategy for designing for effective reverse logistics, these findings contribute to understand the use of information system and technology for reverse logistics to enhance the customer's business process and provide value-added process for customer retention.     

A systematic literature review of sustainable purchasing and supply research: Theoretical perspectives and opportunities for IMP-based research

This paper evaluates and compares the theoretical lenses that underpin sustainable purchasing and supply management research. In particular, our interest is on evaluating the extent to which the IMP Interaction Approach is used to underpin or influence the focus of existing research and exploring the opportunities for further research into sustainable purchasing and supply guided by an IMP perspective. The methodology employed is a systematic literature review (Tranfield et al., 2003). A systematic search process is used to identify 1899 papers that are gradually reduced through a filtering process to 276 papers. The theoretical perspective of each paper is identified and recorded in a database along with methodology, unit of analysis and reported findings. We find that a significant proportion of sustainable purchasing and supply management papers adopt stakeholder theory, institutional theory and resource-based perspectives, however, relatively few papers rely on an IMP Interaction Approach. We evaluate the rationale for the typical theoretical perspectives adopted and discuss the potential for the IMP Interaction Approach to underpin studies of sustainable purchasing and supply management. The paper concludes by outlining future avenues of research that specify how the IMP Interaction Approach can underpin and further advance sustainable purchasing and supply research.     

Systematic Design Methods and the Creative Performance of New Product Teams: Do They Contradict or Complement Each Other?

Can organizations exert control and provide structure for NPD activities while at the same time encouraging and managing creative performance? Any new product development (NPD) project requires some level of creative effort. In new product development, creative performance is of preeminent importance. Most NPD projects are executed with the NPD team as the organizational nucleus. As a result, managing creativity in NPD thus implies managing the creativity of NPD teams. Besides having to manage creative performance, companies are generally also concerned with improving the efficiency and effectiveness of the NPD process. Modern NPD projects therefore have the need for an approach that can be planned, optimized, and verified. As a consequence, systematic design methods have become widely used in NPD. In this article conceptual model is developed of the effect of modern design methodology on the creative performance of NPD teams. First, it is argued that the effect of systematic design methodology on NPD team creativity is mediated by the communication patterns of the NPD team. It is then proposed that four principles underlie modern design methodology: hierarchical decomposition, systematic variation, satisficing, and discursiveness. These principles affect NPD communication by, respectively, influencing the establishment of subgroups, the frequency of communication, the level of agreement or disagreement in the team, and the level of centralization of communication. Next, arguments are presented of how each of these four communicational characteristics shapes the creative performance of NPD teams. This second part of the conceptual model is tested empirically. This is done by studying the communication patterns in 44 NPD teams, employing social network analysis tools. These patterns of communication are then related to team‐level creative performance through a set of regression analyses. The main conclusion of the article is that the design principles work together and need to be considered as an integrated whole: the creative performance of NPD teams can only effectively be managed by using and aligning all four of them.     

Improving process safety by addressing the human element

Celanese had several process safety incidents and near misses in 1996. Although there were several root causes, this article will address only one of them; human error. The system which was developed by Celanese to improve this human element is the conduct of operations system. The conduct of operations system has improved process safety performance of the human element by focusing on three operational areas: training, procedures, and general operations. Conduct of operations is a proactive approach to improve the current practices, improve the support systems and the behavior of the operator. The benefits include the following:

• Consistent application of training and procedures
• Reduction in human error, and
• Less process safety incidents

This article will describe the need for and the content of conduct of operations system as implemented by Celanese. © 2009 American Institute of Chemical Engineers Process Saf Prog, 2009     

Assessing performance factors for a 3PL in a value chain

Business continuity of the logistics companies in the twenty first century highly depends on the value chain performance. As the variety of services outsourced to third party logistics (3PL) companies increase, success strategies for these companies are to be revised. This study explores and illustrates an analytical framework to assess the performance factors for 3PL companies through a managerial view. The factors integrating the strategical and operational targets are evaluated within a framework based on four levels; performance targets, planning activities, logistics operations, and performance attributes of logistics operations. The analytic network process is used to determine the most effective performance attributes. The framework is applied and studied in two major logistics companies active in the South East Europe. The proposed framework will contribute to the logistics sector by demonstrating the paradigm shift in performance measurement.     

SBU strategy and performance: The moderating effects of the corporate-SBU relationship

This study suggests that the link between an SBU strategy and performance is moderated by the SBU's relationship with corporate management. Information processing arguments suggest that this relationship, typically characterized by general measures of centralization, has been inappropriately conceptualized in prior research. An alternative view, one that considers which decisions and activities should be controlled by the individual SBU, is proposed and tested. The results of a study of 496 SBUs indicate that SBU performance is enhanced when: (1) SBUs with an external strategic orientation control environmental monitoring activities and strategic decision analysis, and (2) SBUs with an intraorganizational orientation control those activities relating to operations. Weaker SBU performance is associated with SBU control over those functions and activities not central to the SBU's business strategy. Therefore, it is suggested that the corporate-SBU relationship can either facilitate or inhibit the implementation of the SBU's intended strategy.     

Network process analysis: An event-based approach to study business network dynamics

To develop business, managers need to understand the dynamic nature of the business networks in which their company operates. Qualitative process research offers a promising methodology to deliver that understanding but does not yet provide elaborate analysis methods applicable to business network research. We therefore introduce an event based analysis strategy developed to study processes in business networks. Employing a longitudinal case on a paper trader's internationalization process in a network context as an experimental arena, we propose three tools for process analysis. First, a research steering wheel that combines both retrospective and real time event analysis; second, an analytical scheme comprising influencing factors, critical events and consequent change; and third, an event trajectory that unfolds process patterns. The proposed strategy offers a viable alternative to social network analysis, network pictures and narrative analysis with which to study network change and dynamics. Elaborating events from a moderate constructivist perspective, it enables the researcher to trace and understand processes beyond mere structural change, and to capture their evolution in a multilayered network context. We evaluate the strengths and weaknesses of the methodology and discuss its relevance for research and practice.     

Technological and Design Innovation Effects in Regional New Product Rollouts: A European Illustration

Firms are increasingly recognizing the importance of understanding regional dynamics and their effects on competitiveness. One such area that is gaining increased importance due to intra‐regional trade is the factors contributing to the successful rollouts of new products within a region. New product rollouts are complicated by nature but are further compounded by intricacies in the type of innovation (i.e., technological or design) being introduced into a region. Unfortunately, limited research has investigated this area. This study works to address this limitation by examining the per country performance effects of regional new product rollouts of technological and design innovations. The study examines the introduction of 14 technological innovations and 12 design innovations across 17 unique firms operating in eight European countries from 2000 to 2007. Specifically, this study attempts to show (1) an important role of the type of innovation on a firm's regional new product rollout strategy; (2) a relationship between national culture and the effectiveness of regional rollout strategies; and (3) an influence of economic openness on the type of innovation for regional new product rollout strategies. The results indicate that a longer regional new product rollout strategy is a more effective strategy for technological innovations, while a shorter regional new product rollout strategy is a more effective strategy for design innovations. The study also presents significant interaction effects in relation to the cultural dimensions of uncertainty avoidance and power distance as well as a significant effect of economic openness. Implications for practitioners and academics are presented.     

How integrating industrial design in the product development process impacts on company performance

There is a growing belief that investing in industrial design is beneficial to company performance. This article sheds more light on how and when integrating industrial design in the product development process can enhance a company's competitive position. The basic premise is that the impact of industrial design on company performance is not unconditional, but dependent on industry evolution and design strategy. We opted to define industrial design in a general way, namely as the activity that transforms a set of product requirements into a configuration of materials, elements and components. This activity can have an impact on a product's appearance, user friendliness, ease of manufacture, efficient use of materials, functional performance, and so on. The empirical data incorporated in this study stems from two Dutch manufacturing industries, namely home furniture and precision instruments. Home furniture and precision instruments were selected because the strategy of integrating industrial design in the product development process is rather mature in the first‐named industry and emerging in the second. We collected data from firms investing considerably in industrial design (n = 23) and firms investing little to nothing in industrial design (n = 24), using a semistructured questionnaire that was administrated during face‐to‐face sessions with senior managers. Two out of the three research hypotheses were supported. It was found that the extent to which firms integrate industrial design in new product development projects has a significant and positive influence on company performance (Hla), in particular when the strategy of investing in industrial design is relatively new for the industry involved (Hlb). There was no systematic pattern indicating that design innovation is more important in industries where the use of design is mature than in industries where the use of design is emerging (H2). Instead, we found that design innovation has significant positive performance effects in both types of industries. One important managerial inference from our study is that new product development managers should consider the changing nature of competition during industry evolution while developing strategies that encompass the use of industrial design in new product development. Another important managerial inference is that, besides being innovative in the field of products, being innovative with respect to design and design strategy can help to enhance competitiveness regardless of industry evolution.     

Neo‐Rawlsian Fringes: A New Approach to Market Segmentation and New Product Development*

Prior research into the link between new product development and market segmentation has focused on two main approaches: (1) design, segment, and do limited competitive evaluation; and (2) segment first, design second. This paper proposes a third approach, which is to simultaneously design, perform segmentation according to benefit and to evaluate against competitive designs. This research uses a benefit segmentation technique based on conjoint analysis (or other techniques that relate product attributes to consumer utility) in which the segments emerge simultaneously with the design based on certain design principles or “strategies.” Herein a method is proposed to narrow down the many possible feasible designs (combinations of attributes) to a finite set and to examine the appeal of each design. Five distinct design strategies are proposed for modeling and studying competitive reaction. These include “traditional” ones such as differentiation and new ones whose fringe customers have high utility. The paper shows that these five strategies are adequate for modeling competitive reaction using simulation. Another contribution of the paper is the way competitive reaction is modeled. In generating and evaluating a design the desire herein is also to assess the defensibility of the design and include it in the evaluation criteria. These issues are addressed by decomposing the solution procedure into two phases. In the first phase, different optimal designs are created based on predefined product development strategies. In the second, these optimal designs are compared against one another with regard to market share and potential to secure market leadership. This work shows that the nature of competition as well as the variability of customer preferences are critical to how a strategy performs. This process uncovers a surprisingly robust design strategy—developing attributes such that a “lower fringe” is most satisfied—that even achieves market dominance under certain conditions. This methodology is also applied to partworth data on refrigerators, which provides a concrete example of the concepts and demonstrates results consistent with the propositions developed earlier in the paper.     

Cheddar or Swiss? How strong are your barriers?

This article describes a company's experience with process safety metrics and describes systematic methods to improve safety performance. As a result of a major accident, an internal investigation identified that although a site may have numerous measures for tracking operational and safety performance, these measures may not focus on leading indicators that could provide early warning of potential major incidents. To systematically reduce incidents, especially, low probability high consequence process safety events, it is necessary to focus on prevention and specifically the strength of the barriers. The approach described in this article, therefore, aims to create a combination of Process Safety Performance Indicators that lead to stronger more robust barriers. While industrial history tells us that such high consequence events are infrequent, this significant process safety risk is always present in production operations, and thus needs to be continuously assessed and reduced through systematic safety management. Within one company, this recognition has resulted in a substantial strengthening of process safety risk management through a more comprehensive system of controls embedded within its new Operating Management System, which is being implemented at the site level across all of its operations globally. This article explores the ongoing methodology and approach being used to select a limited but crucial set of Process Safety Performance Indicators to enable effective measurement and the appropriate management of process safety performance. © 2009 American Institute of Chemical Engineers Process Saf Prog, 2009     

Servitization: A contemporary thematic review of four major research streams

Servitization describes the addition of services to manufacturers' core product offerings to create additional customer value. This study aims to identify the key themes and research priorities in this body of literature over thirteen years from 2005 and 2017, based on four major research streams (general management, marketing, operations, and service management). Prior multi-theme literature reviews have focused on operations journals, overlooking important work in other streams, particularly marketing. Informed by a systematic literature review of 219 papers, the study identifies five main themes: service offerings; strategy and structure; motivations and performance; resources and capabilities; service development, sales, and delivery. Within each theme, gaps in the literature are identified and eleven research priorities presented. The review shows that the literature has evolved significantly in recent years, becoming increasingly diverse. A recent noteworthy topic is the use of digital technologies, which indicates the increasing relevance of technological developments to manufacturers' service activities. Our review highlights that there are still some fundamental aspects of servitization that warrant further research, primarily the need to replace the focal-manufacturer perspective with a multi-actor perspective that highlights the important role of relationships with existing and potentially new actors as a result of technological developments.     

Patterns of cooperation during new product development among marketing, operations and R&D: Implications for project performance

Successful new product development is fundamentally a multidisciplinary process. While this view has helped lead management to the wide‐spread adoption of cross‐functional new product development teams, in this study we question whether simply increasing the level of functional integration is truly a guarantee for enhancing the performance of new products. To assess this we examined patterns of cooperation between marketing, R&D, and operations at both early and late stages of the new product development process for 34 recently developed products whose level of innovativeness ranged from high to low. A unique feature of this study is that data were collected from four sources for each project. This included personal interviews with a project leader and written surveys from marketing, operations, and R&D personnel on each project. Findings from this study reveal that: (1) functional cooperation typically increases as the process moves from early to late stages; (2) cooperation between marketing and R&D is highest during early stages of the process, but for marketing and operations, and for R&D and operations, cooperation typically increases as the process moves from early to late stages; (3) higher project performance — irrespective of the level of project innovation — is demonstrated when cooperation between marketing and R&D, and cooperation between operations and R&D is high during early stages; (4) late stage cooperation between marketing and operations, and R&D and operations is a key determinant in project performance for innovative products but not for noninnovative products, and; (5) that early stage cooperation between marketing and operations is associated with superior performance for low innovation projects but is also associated with poor performance for innovative projects. Findings from this study demonstrate that the importance of cooperation between specific functional dyads (i.e., marketing — R&D; R&D — operations; operations ‐ marketing) indeed varies by time (i.e., early vs. late stages), and by the level of innovativeness (i.e., new‐to‐the‐world vs. modifications) associated with the new product being developed.     

Reviewing and improving performance measurement systems: An action research

Reviewing and updating performance measurement systems (PMS) based on internal and external environmental changes are as important as developing and implementing them. The results of an action research study carried out to improve the PMS of an energy company's maritime transportation area are presented. The findings of this longitudinal study illustrate the difficulty and complexity of reviewing and updating an energy company's PMS for its maritime transportation area. This difficulty is due to the involvement of PMS users, the assessment of performance measures, the establishment of targets, and data availability. The complexity is related to the changes in information technology when implementing changes in procedures for computing performance measures. This article contributes to a better understanding of the process of reviewing and updating a company's existing PMS.     

Implementation of value-driven optimisation for the design of aircraft fuselage panels

The work presented investigates a methodology for the implementation of value-driven design (VDD) with application to the optimisation of aircraft fuselage panels. The VDD approach integrates manufacturing and operating costs as optimisation drivers at the design stage. In particular, manufacturer's profit, airlines expenses and revenue, and surplus value relating to competitor products are taken into account in the objective function proposed for the design optimisation. The study shows that using VDD concepts, the manufacturer has the possibility to develop more efficient designs with an increase of both his own profit and the operator's gains.     

Performance feedback and middle managers’ divergent strategic behavior: The roles of social comparisons and organizational identification

Research Summary: What drives middle managers to search for new strategic initiatives and champion them to top management? This behavior—labeled divergent strategic behavior—spawns emergent strategies and thereby provides one of the essential ingredients of strategic renewal. We conceptualize divergent strategic behavior as a response to performance feedback. Data from 123 senior middle managers overseeing 21 multi‐country organizations (MCOs) of a Fortune 500 firm point to social performance comparisons rather than historical comparisons in driving divergent strategic behavior. Moreover, managers’ organizational identification affects whether they attend to organizational‐ or individual‐level feedback. These results contribute to research on performance aspirations and strategy process by providing a multilevel, multidimensional framework of performance aspirations in middle management driven strategic renewal. Managerial Summary: Middle managers are essential actors in strategic renewal. Their unique positions offer insights into operations alongside knowledge of strategy. In contrast to typical assessments of managerial performance with reference to a prior year, this research shows that performance comparisons relative to peers and other organizational units better motivate managers’ divergent strategic behavior. Our results also show that managers who identify with the firm are more attentive to organizational rather than individual performance discrepancies. Thus, our study unveils an important approach for organizations aiming to spark strategic renewal.     

Diversification strategy and internationalization: Implications for mne performance

This study examines potential explanations for performance differences among multinational enterprises (MNEs). The research variables, diversification strategy and degree of internationalization, involve basic elements of firms' strategy: range and relatedness of products, and relative emphasis on foreign versus domestic operations. The sample included the 100 largest MNEs from the U.S. and Europe. Diversification strategy was significantly related to MNE performance, extending Rumelt's seminal research to international business. Degree of internationalization was also significantly related to MNE performance.     

Do technology and manufacturing strategy links enhance operational performance? Empirical research in the auto supplier sector

Although much of the literature on manufacturing strategy (MS) and technology studies the implementation and impact of these manufacturing programs in isolation, this paper goes further by assessing the joint implementation and effect of these two manufacturing programs on performance, even when some contextual factors are present. Thus, this paper investigates how plants from the auto supplier sector make use of some operations practices from manufacturing strategy (MS) and from both product and process technology, by testing the effectiveness of both sets of practices, with the ultimate goal of enhancing operational performance. The results suggest that there are only very minor differences between high and standard performers on the aggregated level for technology practices, which may be the reason why technology does not result in significant performance differences between the two plant types. On the other hand, on the aggregated levels, there are somewhat greater differences for MS practices than for technology in both plant types, leading to larger differences in performance. While this study provides a foundation for examining MS, technology and context within a single framework, it is only through further research that a full understanding of the relationship between them will be obtained.     

Product and Process Modularity's Effects on Manufacturing Agility and Firm Growth Performance

Modularity in product design has been hailed as a way to speed new product development (NPD), to reduce NPD cost, and to enhance customization possibilities for consumers. Modularity in process design may speed new product manufacturing setup times, reduce costs, and enhance the profitability of the lower volumes that customization often entails. However, empirical evidence is scarce that either product or process modularity—individually, jointly, or sequentially—actually produce these or other proposed benefits (e.g., performance growth). This study builds on general modular systems theory (GMST) by examining the theoretical relationship between product and process modularity and the effects of each on firm growth performance. Using structural equation modeling, partial versus complete mediation by manufacturing agility is also scrutinized. In one pair of models, product modularity and process modularity are separate direct antecedents to manufacturing agility, which is modeled to affect firm growth performance; in a second pair of models, product and process modularity are related antecedents to manufacturing agility, with product modularity preceding process modularity. Results from the best‐fitting model show that product modularity directly and positively affects process modularity, manufacturing agility, and firm growth performance. Process modularity was unrelated to manufacturing agility, and neither process modularity nor manufacturing agility predicted growth performance. Consistent with GMST, the study provides empirical evidence of the power of one element of a modular system to orchestrate a fit between a firm's product and manufacturing strategies and to directly drive system performance. Thus, modularity in product design is revealed as the key to understanding GMST effects concerning how changes in one system generate changes in other systems.