On the Applicability of Analytical Techniques for the Selection of AMTs in Small-Medium Sized Firms

The appraisal and selection of investments in advanced manufacturing technologies (AMTs) have received a considerable attention in the literature over the last decade. In particular, many articles, after highlighting the major shortcomings of traditional financial techniques when applied to the analysis of AMTs, have proposed alternative approaches, such as modified discounted cash flow techniques, strategic approaches and multi-attribute decision making methods. However, little attention has so far been paid to the applicability of such "non-conventional" approaches to small-medium sized firms (SMFs). This omission is particular critical for two reasons. First, in most SMFs the decision to adopt a given AMT is usually not supported by any technique, but is based rather on an "act of faith" in a new technology on the part of the entrepreneur. Second, there are some non-conventional techniques that seem particularly suitable for SMFs, in that they do not require major financial and strategic competencies or complex information and planning systems. This article seeks to increase the awareness of major non-conventional approaches among the owners and managers of SMFs and analyse critically the applicability of such approaches.