THE EFFECTS OF TECHNOLOGY IN MANUFACTURING FIRMS

The effects of Technology in Manufacturing firms

The effects of Technology in Manufacturing firms

Introduction

Implementation of advanced manufacturing technologies, or AMTs, has become a source of competitive advantage for companies. From an operational perspective there are many benefits from investing in cutting edge capital equipment. Greater flexibility, cost reduction, improved customer service and quality all contribute to making the introduction of AMTs profitable.

To fully exploit the potential of AMTs, companies should consider the need for a supporting infrastructure (Jonsson, 2000). Shortcomings registered in these new technologies are frequently the result of insufficient attention to company organisation, infrastructure and maintenance. All three are necessary for advanced manufacturing technologies to work smoothly and show successful results.

The process of new technology introduction brings about changes in qualifications requirements for personnel, as task content and task organisation are adjusted to the new situation. Training is highlighted as the most appropriate tool to guarantee that the workforce will meet the new needs that manufacturing process innovation originates in a company.

From a human resource perspective, the present study focuses on the factors that cause companies implementing AMTs to provide training programmes for their employees. The study centres on the use of information technologies (IT) in the field of manufacture, especially in the fields of design and engineering, manufacture, mechanisation and assembly. Types of AMT follow the basic categories suggested by Adler (1988), Calabrese (1995), Jonsson (2000), and Meredith (1987): design technologies (CAD) and manufacturing technologies (CAD/CAM, CN/CNC, FMC/FMS, laser, other cutting technologies, robots, automatic warehousing systems, sensors).

The scope of the study is restricted to formal training and off the job training, organised and carried out by the company. The theoretical background is based on human capital theory and resource and capabilities theory, which traditionally support training in organisations.

Theory and research propositions

The purpose of this study is to answer the following questions: does investment in AMTs have a significant impact on personnel training in companies? What factors prompt a company to organise personnel training and allocate specific training budgets? The key hypothesis of this study suggests that company training is mainly influenced by the introduction of AMTs in the manufacturing process.

New technologies affect job requirements (Mintzberg, 1984) and have an influence on workers' abilities, as they are required to acquire the skills necessary to perform their tasks. Therefore, when faced with a new technical alternative, options for task organisation and process training must be considered to justify the investment (Sorge and Streek, 1987). Table I summarises literature that illustrates how successful implementation of AMTs in organisations requires a definite infrastructure and includes human resource mobilisation.

However, some company strategy still tends to emphasise the firm's investments in physical capital resources. Often, little attention is paid to the human aspect of the company, when both human and physical resources need to work together.

Key variables

The first key variable in our hypothesis is the implementation of advanced manufacturing technologies or AMTs. AMTs are defined as manufacturing techniques that use microelectronic ...