Towards a Theory of Competitive Progression: Evidence from High‐Tech Manufacturing

Towards a Theory of Competitive Progression: Evidence from High‐Tech Manufacturing This study replicates and extends Ferdows and De Meyers' observed ‘sand cone’ model of cumulative competitive capabilities by means of Roth's related competitive progression theory (CPT). Using path analysis, we model and test the relationships among the generic competitive capability constructs of conformance quality, delivery reliability, volume flexibility, and low cost as predicted by CPT. Our results, drawn from a sample of high‐tech manufacturers, provide further evidence that on average, these four capabilities are acquired both cumulatively and in that sequence. We also find that each generic capability increases operational know‐how and reduces non‐value‐added directly and/or indirectly through the enhancement of successive capabilities in the progression, which in turn improves profitability. The paper contributes a theoretical rationale for the observed sand cone effect, describes how the competitive progression acts to influence accelerated organizational learning over an innovation cycle, and offers evidence that combinative capabilities have strategic value for high‐tech manufacturers. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Production and Operations Management Wiley

Towards a Theory of Competitive Progression: Evidence from High‐Tech Manufacturing

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Publisher
Wiley
Copyright
© 2004 Production and Operations Management Society
ISSN
1059-1478
eISSN
1937-5956
DOI
10.1111/j.1937-5956.2004.tb00223.x
Publisher site
See Article on Publisher Site

Abstract

This study replicates and extends Ferdows and De Meyers' observed ‘sand cone’ model of cumulative competitive capabilities by means of Roth's related competitive progression theory (CPT). Using path analysis, we model and test the relationships among the generic competitive capability constructs of conformance quality, delivery reliability, volume flexibility, and low cost as predicted by CPT. Our results, drawn from a sample of high‐tech manufacturers, provide further evidence that on average, these four capabilities are acquired both cumulatively and in that sequence. We also find that each generic capability increases operational know‐how and reduces non‐value‐added directly and/or indirectly through the enhancement of successive capabilities in the progression, which in turn improves profitability. The paper contributes a theoretical rationale for the observed sand cone effect, describes how the competitive progression acts to influence accelerated organizational learning over an innovation cycle, and offers evidence that combinative capabilities have strategic value for high‐tech manufacturers.

Journal

Production and Operations ManagementWiley

Published: Dec 1, 2004

References

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