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Dedicated to Willo A Guiding Light - Dublin City University PDF

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Dedicated to Willo A Guiding Light World Class Manufacturing: Implementation and Measurement in the Irish Automotive Rubber Mouldings Component Industry This one volume thesis, supervised by Dr Jim Whyte and Dr David Jacobson, Dublin City University Business School, Dublin City University, is submitted in candidature for the award of Doctor of Philosophy. Sarah Ingle BSc(Eng), MIE, MIEI, Chartered Engineer. December 1999 World Class Manufacturing: Implementation and Measurement in the Irish Automotive Rubber Mouldings Component Industry I hereby certify that this material, which I now submit for assessment on the programme of study leading to the award of PhD, is entirely my own work, and has not been taken from the work of others, save and to the extent that such work has been cited and acknowledged within the text of my work. ID No: 94970505 Date: 1 W Sarah Ingle TABLE OF CONTENTS ABSTRACT vi ACKNOWLEDGEMENTS vii LIST OF TABLES viii LIST OF FIGURES x ABBREVIATIONS xi GLOSSARY xiii 1. INTRODUCTION 1 1.1 CHAPTER OVERVIEW 1 1.2 INTRODUCTION TO THE RESEARCH 3 1.3 OVERVIEW OF RESEARCH IN GENERAL 6 1.4 THEORETICAL FOUNDATION 10 1.5 JUSTIFICATION FOR CHOICE OF THEORETICAL FRAMEWORK 16 1.6 SIGNIFICANCE AND CONTRIBUTION OF THIS STUDY 19 1.7 THESIS STRUCTURE 25 2. WORLD CLASS MANUFACTURING 28 2.1 CHAPTER OVERVIEW 28 2.2 INTRODUCTION 28 2.3 CRITIQUE OF WCM LITERATURE 38 2.4 CONCLUSION 66 3. STRATEGY, CONTROL AND MEASUREMENT 69 3.1 CHAPTER OVERVIEW * 69 3.2 STRATEGY AND CONTROL 70 3.3 MANAGEMENT CONTROL 74 3.4 STRATEGY, CONTROL, MEASUREMENT AND WCM PRACTICES80 3.5 CHANGING NATURE OF PERFORMANCE MEASURES 84 3.6 OLD PERFORMANCE MEASURES 89 3.7 NEW PERFORMANCE MEASURES 96 3.8 OLD AND NEW MEASURES COMPARED 99 3.9 CRITIQUE OF CONTROL AND MEASUREMENT LITERATURE 102 3.10 SUMMARY AND CONCLUSION 119 3.11 THEORETICAL FRAMEWORK 122 4. RESEARCH METHODOLOGY 127 4.1 CHAPTER OVERVIEW 127 4.2 INTRODUCTION 127 4.3 IDENTIFICATION AND SELECTION OF STUDY COHORT 129 4.4 JUSTIFICATION FOR CHOOSING SEGMENT OF INDUSTRY 134 4.5 DETAILS OF DATA COLLECTION 139 4.6 PERFORMANCE MEASUREMENT QUESTIONNAIRE 155 4.7 CONCLUSION 157 . IRISH AUTOMOTIVE COMPONENT INDUSTRY 159 5.1 CHAPTER OVERVIEW 159 5.2 OVERVIEW OF IRISH AUTOMOTIVE COMPONENT MANUFACTURING INDUSTRY 159 5.3 AUTOMOTIVE COMPONENT MANUFACTURERS IN IRELAND 161 5.4 OVERVIEW OF RUBBER MOULDINGS SUB-SECTOR 173 5.5 INDIVIDUAL CASE COMPANIES 173 . RESEARCH FINDINGS 192 6.1 CHAPTER OVERVIEW 192 6.2 PROPOSITION 1.1 193 6.3 PROPOSITION 1.2 202 6.4 PROPOSITION 1.3 229 6.5 PROPOSITION 2.1 246 6.6 PROPOSITION 2.2 258 6.7 PROPOSITION 3.1 271 6.8 PROPOSITION 3.2 288 6.9 SUMMARY 295 . ANALYSIS AND DISCUSSION 299 7.1 CHAPTER OVERVIEW 299 7.2 REASONS FOR IMPLEMENTATION OF WCM PRACTICES 299 7.3 ADOPTION OF TQM, JIT AND El INITIATIVES 302 7.4 IMPLEMENTATION MODES 304 7.5 PERFORMANCE MEASUREMENT SYSTEMS 309 7.6 EMPIRICAL RESEARCH MODEL 313 7.7 CONCLUSION 319 iv 8. SUMMARY AND CONCLUSION 322 8.1 CHAPTER OVERVIEW 322 8.2 THESIS REVIEW 322 8.3 SUMMARY OF THESIS ARGUMENTS 325 8.4 EMPIRICAL RESEARCH MODEL 327 8.5 RESEARCH CONTRIBUTION 330 8.6 RECOMMENDATIONS FOR FUTURE RESEARCH 335 8.7 CONCLUDING DISCUSSION 340 9. BIBLIOGRAPHY 344 APPENDIX A Schonberger's 16 Customer Centred Principles APPENDIX B Interview And Interviewee Details APPENDIX C Letter Sent To Firms And Enclosure APPENDIX D Outline Of Interview Questions In Irish Rubber Mouldings Companies APPENDIX E Adapted Performance Measurement Questionnaire Used In Empirical Research. APPENDIX F Introductory And Explanatory Address To PMQ Respondents. APPENDIX G Sample Spreadsheets Used To Analyse PMQ Data APPENDIX H Interview, Plant Tour And Company Documentation APPENDIX I Calculation Of Importance Of WCM Scores APPENDIX J Individual Employee Performance Measures APPENDIX K Calculation Of Emphasis Scores For Old And New Measures World Class Manufacturing: Implementation and Measurement in the Irish Automotive Rubber Mouldings Component Industry ABSTRACT The main objectives of this thesis are to determine how and why world class manufacturing (WCM) practices are implemented, and to examine potential links between the introduction of these kinds of practices and performance measurement systems. There is theoretical and empirical evidence to suggest that WCM practices can be categorised into one or more of: total quality management (TQM), just in time manufacturing (JIT) and employee involvement (El). Four different WCM implementation modes are also identified in the literature. Research in the areas of management control and performance measurement suggest that in order for companies to assess the benefit of implementing WCM practices, there is an increasing necessity for them to use both financial and non-financial measures effectively. This literature thus provides the basis for the theoretical framework used in the study. The complete rubber mouldings segment of the Irish automotive component manufacturing industry is examined using a case-based design, to address both the initial research questions and the research propositions developed following literature reviews. The empirical data includes information from: preliminary interviews in academia, consultancy and government agencies; in-company interviews; plant tours; and a performance measurement questionnaire administered to three management levels in each of the five organisations studied. The findings suggest that firms can utilise both a main and secondary mode to introduce WCM practices, and that the overall implementation mode used is both affected by and affects other variables. This thesis contributes to research in a number of ways. First it provides an in- depth study of WCM practices and performance measurement in an Irish context. It also develops and applies a classification of the implementation modes used to introduce WCM practices. Finally, it identifies internal and external factors associated with both the introduction of WCM practices as well as the performance measurement system utilised. Sarah Ingle December 1999 ACKNOWLEDGEMENTS I would first like to thank all the people involved in my post-graduate research review process in Dublin City University Business School. As supervisors, colleagues and friends they contributed greatly to ensuring the final completion of this thesis. In particular they include Jim Whyte, David Jacobson, Bernard Pierce, Eunan O'Halpin and Siobhain McGovern. Without the full cooperation of the general managers, and other employees of the companies surveyed in the study, the work would not have been possible. I would like to gratefully acknowledge their help and hope that they too have learned from the process. The interviewees in industry, government agencies, consultancy and academia should also be thanked as they willingly gave of their time to explain, confirm and consolidate the knowledge that was being gathered before the field research. I would particularly like to acknowledge the help of Professor J. Robb Dixon, one of the authors of the performance measurement questionnaire used, who was very encouraging. The two pilot studies proved to be very useful in defining the questionnaire in an Irish context. Thanks to the two groups for their time and interest, and their lecturer and managers who approved them taking part. To my other colleagues and friends in Dublin City University Business School and Library, I extend a global message of appreciation for their continual support and words of encouragement at all stages of the work. I would especially like to acknowledge Ziene and Helen for always being available to listen and offer advice, and Shane, Treasa, Eileen, Rachel, MaryLou, Mary, Chris and Gary for their general counsel. I could not have finished the work without the continuing practical and emotional help of my other friends and family. Thanks especially to my mother Ann, and Katie, Rachael, Roisin, Mladen, Peter, Michael, Bette, Billy, Lisa and Tiernan for all their assistance along the process. Finally to Willo, Fionn and Blaithin who helped keep it all in perspective. Thanks for your unconditional love and support, and for being there every time I needed you. vii LIST OF TABLES Table 2.1 Elements of WorldC lass Manufacturing 44 Table 3.1 Comparisons of Assumptions in Intended and Emergent Strategies 71 Table 3.2 Characteristics of Old and New Performance Measures 101 Table 3.3 Contrasting Headings for Measurements and Controls 108 Table 3.4 Outline of Differing Performance Measurement Frameworksl 11 Table 3.5 Perspectives of Balanced Scorecard 112 Table 3.6 Old and New Performance Measures Listings 119 Table 3.7 Research Questions and Associated Propositions 123 Table 4.1 Statistics for Segments Considered in the Sector 130 Table 4.2 Statistics for Companies with Greater than 100 Employees 133 Table 4.3 Research Process Outline 140 Table 4.4 Automotive Component Company Interviews 141 Table 4.5 Some Changes Made to Original PMQ 146 Table 4.6 Profile of Respondents to PMQ in each Firm 154 Table 5.1 Irish Automotive Component Industry Employment and Exports 160 Table 5.2 Irish Automotive Component Sector - Numbers Employed 163 Table 5.3 Irish Automotive Component Sector- Ownership of Companies163 Table 5.4 Irish Automotive Component Sector - Year of Establishment 64 Table 5.5 Details of Companies in Rubber Moulding Segment 173 Table 6.1 Customer Influences on Introduction of New Practices 194 Table 6.2 Score for Importance of WCM Practices from PMQ 200 Table 6.3 Categorisation of WCM Practices 203 Table 6.4 Outline Points of WCM Implementation Modes 229 Table 6.5 WCM Implementation Modes Used inE ach Company 243 Table 6.6 Internal/External Relationship Types and Implementation Modes 255 Table 6.7 Performance Outcomes Summary 267 Table 6.8 Performance Outcomes and Implementation Modes 268 Table 6.9 Categorisation of Old Measures 273 Table 6.10 Categorisation of New Measures 281 Table 6.11 Plant Managers' Personal Performance Evaluation in Five Time Frames 285 Table 6.12 Comparison of New and Old Performance Measure Utilisation291 Table 6.13 Calculation of New/Old Performance Factor Emphasis from PMQ 292 Table 6.14 Top Important Performance Measures for All Firms 294 Table 6.15 Research Propositions and Conclusions 1 295 Table 6.16 Research Propositions and Conclusions 2 296 Table 6.17 Summary of Differences between CompanyG roupings 297

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