Role of decoupling point in examining manufacturing flexibility: an empirical study for different business strategies

Abstract

Manufacturing flexibility has been the subject of scholarly debate for decades. The literature investigated the relationship between manufacturing flexibility (MF) and business strategy realisation. However, scholars are yet to establish the relationship between these two constructs as mediated by the position of decoupling point (DP), which plays a key role in the design and management of supply chains. To address this gap, this paper develops a theoretical model grounded in strategic choice theory, which investigates the direct relation between MF and the position of DP, as well as the indirect relation between MF and business strategy as mediated by the position of DP. Based on a sample of 257 responses from a survey with Indian organisations, we test the model using structural equation modelling. The findings reveal that the level of MF varies with the position of DP within supply chains. This position of DP differs in different types of business strategies and accordingly affects their MF.

Keywords:

• decoupling point
• business strategy
• manufacturing flexibility
• structural equation modelling

ORCID

Rameshwar Dubey http://orcid.org/0000-0002-3913-030X