Exploring the micro-foundations of ambidextrous production: home-owned versus foreign-owned firms in the automotive industry

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Authors

Abstract

The open nature of competition in the UK automotive industry is demonstrated by the large number of foreign firms that operate in this sector, which necessitates both exploitative and explorative capabilities. The main aim of this study is to investigate whether it is possible to distinguish domestically-owned (UK) and foreign-owned firms on the basis of the micro-foundations of ambidextrous production, which are conceptualised as the Tools, Practices, Routines and Concepts (TPRCs) of lean and agile production. Survey data were collected from 85 home-owned and 55 foreign-owned firms, whose operations are located in the United Kingdom’s Midlands automotive industry. Logistic regression results reveal that domestically-owned firms were significantly more likely to be implementing agile (explorative) production methods, and foreign-owned firms were significantly more likely to be implementing lean (exploitative) production. Our findings not only advance the lean-agile debate, but we theoretically support a Contingency Theory (CT) perspective by advocating that firms align their performance priorities with contextual factors, in this case, their country of ownership and supply chain position. Moreover, by incorporating an argument built upon the strategy literature on Business Models (BMs) and Dynamic Capabilities (DC), we assert that home-owned and foreign-owned firms have evolved to underpin different kinds of competitive advantage within the same industry; however, these advantages are located at different tiers in the automotive supply chain. Given this, we advocate that foreign-owned firms internationalise into the UK automotive sector to exploit the explorative capabilities acquired by home-owned firms operating upstream in automotive supply chains.

Details

Original languageEnglish
Title of host publication46th Academy of International Business UK & Ireland Chapter Conference
Subtitle of host publicationMultinational Enterprises and their Non-market Social and Political Strategies
Publication statusPublished - 25 Apr 2019