Developing a Manufacturing Strategy — Principles and Concepts

Abstract

Companies invest in a wide range of functions and capabilities in order to make and sell products at a profit. Consequently the degree to which a company’s functions are aligned to the needs of its markets will significantly affect its overall revenue growth and profit. The appropriate investment in processes and infrastructure in manufacturing is fundamental to this success. The reality is that a lack of fit between these key investments and a company’s markets will lead to a business being well wide of the mark. If a firm could change its manufacturing investments without incurring such penalties as long delays and large reinvestments, then the strategic decisions within manufacturing would be of little concern or consequence. However, nothing could be further from the truth. Many executives are still unaware

that what appear to be routine manufacturing decisions frequently come to limit the corporation’s strategic options, binding it with facilities, equipment, personnel, basic controls and policies to a non-competitive posture, which may take years to turn round.¹