Abstract
In this paper, we examine in detail 35 final assembly location decisions to gain understanding of the manufacturing location decision from strategy and economic policy perspectives. We are particularly interested in the decision to locate final assembly specifically in a high-cost (high GDP per capita) environment. In contrast with the earlier literature, we focus not just on manufacturing activities themselves, but also the key linkages between production, market, supply chain, and product development. These linkages are examined using three key concepts from theories of organization design: formalization, specificity, and coupling. Using these concepts, an analysis of the micro-structure of each case reveals important commonalities that inform our understanding of location decisions. We conclude by discussing the policy implications of our findings.
| Original language | English |
|---|---|
| Pages (from-to) | 20-30 |
| Number of pages | 11 |
| Journal | Journal of Operations Management |
| Volume | 49-51 |
| DOIs | |
| Publication status | Published - 1 Mar 2017 |
| MoE publication type | A1 Journal article-refereed |
Funding
This paper has been completed as a part of the InSource project conducted by ETLA, The Research Institute of the Finnish Economy, and KTH, Royal Institute of Technology in Stockholm, Sweden. We gratefully acknowledge financial support by the Finnish Funding Agency for Innovation (Tekes), Sweden's Innovation Agency (VINNOVA), the BRIE-ETLA research project, and Academy of Finland. We also thank the 35 case companies for investing a considerable amount of their time and their expertise to this research effort.
Keywords
- Case study
- International operations
- Manufacturing location decisions
- Supply chain management
