Production Process Moves and the Effective Management of Process Knowledge

Abstract

While production process moves are more prevalent than ever, there have mostly been studies that look at the “what”, “why”, and “where” of a move (Chen et al. 2015; Cohen et al. 2016; Wu and Zhang 2014; Simchi – Levi 2012; Sirkin et al. 2014). Little research examines the “how” of a move. After a firm decides to move their production process, how do they do it in a way that will minimize downtime and allow them to achieve their pre-move performance quickly? Based on in depth discussions with multinational companies who have undergone production moves, my dissertation focuses on the transfer of production knowledge. Specifically, the dissertation is organized into three essays. The first essay focuses on template use and its link to performance. A template can be described as a working example of organizational routines that contains both critical and noncritical elements of the routines (Nelson and Winter, 1982). Using behavioral experiments in which 4-person teams put together complex building devices, I demonstrate that template use leads to improved performance vs. not using templates at all. However, I also show that strict template use, without the ability for teams to adjust the process, leads to reduced performance. Building on the results of the first essay, the second investigates the role of functional diversity in enhancing/eroding knowledge transfer effectiveness when using templates. Functional diversity is defined as the extent to which education, experience and expertise of team members across different teams vary (Jehn, 1999). Through the creation of an experiment in which I have production knowledge being transferred between subjects with either a Business or Engineering background, I find the results to be contextual. When transferring the process from Business to Engineering, functional diversity leads to reduced performance, likely due to a lack of credibility given to the Business teams by the Engineers. However, when knowledge is transferred from the Engineers to Business teams, functional diversity performance is in line with “within function” results. Lastly, the third essay looks at the role that national culture plays in a firm’s ability to transfer knowledge between countries that have unique cultures. I create an experiment that involves knowledge transfer within and between teams located in two important, yet unique countries: United States and China. I also examine if collocating members of the source team with the recipient team members mitigates the impact of national culture. The results show that transferring knowledge between unique cultures leads to reduced performance vs. transferring knowledge within similar cultures. In addition, co-location is a successful strategy to employ for the Chinese recipient teams, while it has no effect on U.S. team performance.