By Dr. Kim Bates
What constitutes great research in management? How do we measure the impact of research? These questions plague policy makers, academics and practicing managers.
I write this from a research group meeting in Seville, Spain. I’m meeting with team leaders representing teams from 20 countries. We began in 1988 with 5 researchers from the US and Japan, including yours truly, and are now dubbed the “High Performance Manufacturing Project”. When we began, North American manufacturers were very concerned about the ascendancy of Japanese firms, who were viewed as a major threat to manufacturing jobs in North America. We focused on manufacturing innovations that had been developed in Japan that were a mixture of teamwork and industrial engineering, along with practices that had been developed in the west, which were based on information technologies. We found that the best American-owned plants were managed a lot like the Japanese-owned plants in the US. The laggards, however, did not. Today we know that many of those plants are probably closed or were moved offshore.
As researchers we were careful in measuring both the practices and performance. We spent a lot of time trying to figure out ways to measure manufacturing process technologies, performance measures and people’s perceptions of these practices, along with measures of the plant culture and decision making. Twenty five respondents per plant, including most of the management team and a sample of line operators, answered individual questionnaires. We published a few articles in top journals that would prove to become very influential, and our methodologies earned us a place in a vanguard of empirical researchers in Operations Management that transformed the field as an academic discipline. We discovered that high performing plants invested in both human capital and innovative technologies. Human and social capital was clearly important for success. But this was the early 1990s, and reducing head count made you a hero on Wall Street. Politicians were concerned with job losses, which was highly motivating to voters. The business discourse around manufacturing was all about high labour costs, even for high technology plants where labour is generally less than 5% of total costs. As a young, newly minted Ph.D., I was somewhat dismayed that our findings were falling on deaf ears in practice.
Fast forward to 1995. We went out again to collect data in five countries, and learned a great deal about the differences between them. It became clear that innovative manufacturing practices made top performing plants top performers, although there were clear differences within countries. One influential finding was that top performing plants seemed to be following a strategy of trying to develop unique capabilities, or perhaps were simply those plants whose innovative practices would later be copied by others. Both human capital and innovative technologies seem to be important in producing high performance. In 2005 we completed our third round of data collection, and are still publishing research from it. The findings around human capital and innovation are stable.
As we sit around the table of team leaders from around the world in 2012, we see a radically transformed manufacturing landscape. We have added sections on sustainability and social responsibility to the project. Our Chinese team proposes to pair Chinese subsidiaries with factors in the parent firms from other countries, while several of the European teams cannot produce a balanced sample size because of shrinking numbers in one or more industries. The global financial crisis of 2008 has taken its toll in both Europe and North America. We are reaching out to the plants directly for the first time on social media, and we now find that our database is valuable to practicing managers who are willing to pay to know how they compare to their peers around the world – especially in the 3 BRIC countries included in the project. There is great interest in the manufacturing community, and I am confident that our work has made a difference to manufacturing innovation in many countries.
Is this enough? We know we have had an impact on academia, with dozens of dissertations and hundreds of articles in journals, and even a collaborative book. We know that management at the plants value the information we provide, and some countries now charge for participating.
I am no longer dismayed by our impact on practice, but I also recognize how naïve I was to think our findings would affect the exodus of manufacturing from the developed world. I know our findings do affect decision making at the surviving plants, and I am proud of that. I am cautiously optimistic that we will have an impact on both practice and public policy in Canada, which is participating for the first time, supported by the Centre for Labour and Management Relations at Ryerson and with funding from the Schulich School of Business at York. Today, manufacturing is a less important for the fate of prosperity in Canada and other developed countries. We have been at this for almost 25 years, and I wonder how the manufacturing landscape will have changed when I retire.
Relevant? Check. Innovation? Check. Impact on practice? Check.
Is this great research? We can but try.
Dr. Kim Bates is the Director of the Ryerson MBA program and Associate Professor, Entrepreneurship & Strategy