Assimilation of advanced manufacturing technologies in small and medium sized enterprises: an empirical analysis

Abstract

Small and medium-sized businesses are embarking on an ambitious journey of adopting advanced manufacturing technologies due to increased competition and the desire to remain competitive (AMTs). Global competition is measured in terms of improved quality, lower costs, value for money items, quick service, and variety, all supplied concurrently. Due to resource constraints, implementing advanced manufacturing technology has become a lengthy and complex process for small and medium-sized businesses. As the success or failure of a technology is determined by the implementation methods rather than the technology itself, it is worthwhile to study the practices used by small and medium enterprises while implementing advanced manufacturing technologies. A structured questionnaire was administered to 300 Indian SMEs out of which 126 valid responses were obtained. The data obtained was empirically analysed with SPSS 20.0 to explore the following: AMT enablers, current level of AMT assimilation in SMEs, assimilation pattern differences and key factors for improving AMT implementation effectiveness. Findings of this study shows that there is a very strong correlation (0.896) between two direct advanced manufacturing technologies – Flexible Manufacturing Systems and Computer Integrated Manufacturing. Other significant correlation (0.704) is observed between Robotics and Automated Storage/Retrieval Systems. Also, amongst indirect AMTs our results establish a strong correlation (0.814) between Material Requirement Planning and Computer Aided Design. The result of the hypotheses testing indicates that 43.1 % of the performance of the SMEs is explained by AMTs. The findings of this study will help SMEs in the effective assimilation of AMTs.