Manufacturing strategy process: the role of shop-floor communication

The purpose of this paper is to analyze the link between manufacturing strategy formalization and manufacturing strategy implementation, considering the potential moderating role of shop-floor communication.

Multiple linear regression models considering main and interaction effects of strategy formulation and shop-floor communication on strategy implementation were performed using data from the fourth round of the international HPM Project. This includes plants with more than 100 employees in the automotive, machinery and electronics industries from 10 different countries. Unlike other research studies, this research takes into account plant management’s and plant supervisors’ perceptions.

The findings show that formal strategic planning positively influences manufacturing strategy implementation. Furthermore, both feedback and instructive communication practices moderate the manufacturing strategy process, resulting in successful manufacturing strategy embeddedness, and prompt adaptation to change.

This study provides a better understanding of the manufacturing strategy process for scholars and practitioners. In addition, the results suggest that the adoption of some shop-floor communication practices can benefit firms through the strengthening of strategy implementation.

This paper provides empirical evidence to the emerging discussion on whether formal strategic planning helps to adopt a strategy or on the contrary make decision making inflexible.