Jens Kaiser

The site role concept developed by Ferdows and empirically tested by Vereecke et al. discusses the specific advantages of globally distributed manufacturing plants. It conceptualizes the primary reasons for manufacturing sites to exist–the strategic site reasons. This article presents the results of a multiple case study further examining the reasons to establish a site, the sites' main advantage today, and related contingency factors. The findings show that the main reasons to establish or acquire a manufacturing site are access to low-cost labor, new technologies, and reliable transportation. The most stable reason over time is access to skills and know-how.

To profit from cost differences, growth opportunities in emerging markets, lower transaction costs, and fewer trade barriers, manufacturing companies have strongly driven their internationalization efforts over recent decades. Today, these companies produce at globally distributed manufacturing sites and the individual steps of the value chain take place at different locations in the network. However, uncertainties caused by shifting economic forces, conservative winds, and protectionism as well as events such as the COVID-19 pandemic reveal the strong vulnerability of International Manufacturing Networks. Consequently, companies are reevaluating their optimization efforts of often opposing target dimensions such as efficiency, flexibility, time, and quality. In this chapter, we examine today’s business environment of International Manufacturing Networks and its implications on the management of those networks by presenting relevant success factors.

With 69 participants, the study provides an informative insight into global production strat-egy. Therefore, the results can be used as a guideline for building competitive advantages through a sustainable production strategy.