Competitive Strategy Based on Flexibility: Implementation in Family Firms

Competitive Strategy Based on Flexibility: Implementation in Family Firms

Marta Pérez-Pérez (University of Cantabria, Spain), María Concepción López-Fernández (University of Cantabria, Spain) and Ana María Serrano-Bedia (University of Cantabria, Spain)
DOI: 10.4018/978-1-5225-8012-6.ch007


This chapter is intended to analyze the extent to which businesses in Spain have adopted several flexibility-manufacturing practices. Specifically, this study explores firstly, sample-based differences in the results of comparative family firms versus nonfamily firms concerning practices for implementing manufacturing flexibility. Secondly, heterogeneity in this implementation process within different groups of family firms was explored. The gathered evidence suggests that the main differences with respect to practices for implementing manufacturing flexibility appear when specific characteristics surrounding family firms and related to the role of the CEO and family involvement in the management of the firm are considered.
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The economic globalization and increasing competitive pressures for most firms demand innovative strategies to comply with such dynamic and complex environments. In addition, the increasingly digitized technological innovations and the higher demand uncertainty set new challenges for manufacturing firms seeking a competitive advantage (Wei, Song, & Wang, 2017; D'Souza & Williams, 2000; Urtasun-Alonso, Larraza-Kintana, García-Olaverri, & Huerta-Arribas, 2014; Jain, Jain, Chan, & Singh, 2013). This situation leads organizations to implement efficient and effective management strategies and practices in order to respond quickly to the changing requirements of the current competitive environment (Broekaert, Andries, & Debackere, 2014; 2016). Consequently, the focus of the strategy has shifted from cost, quality and term/service delivery to flexibility (Jain et al., 2013; Pérez-Pérez, Serrano-Bedia, & López-Fernández, 2016). In fact, the flexibility strategy is currently one of the main success factors for all those companies seeking to enjoy a favorable position in the market (Pérez-Pérez, Serrano-Bedia, López-Fernández, & García-Piqueres, 2018; Pérez-Pérez et al., 2016; Mendes & Machado, 2015; Mishra, Pundir, & Ganapathy, 2014; Jiménez, Machuca, Garrido-Vega, & Filippini, 2015).

Strategies based on flexibility, specifically in strategic, organizational, and manufacturing flexibility, allow companies to adapt to changing circumstances in an organized manner, thus increasing their competitiveness, and avoiding a chaotic behavior that is dysfunctional. It is considered that those companies that are sluggish and inflexible are likely to miss valuable opportunities for profit and growth (Zahra, Hayton, Neubaum, Dibrell, & Craig, 2008).

Family businesses, which are the dominant corporate figure in the economic structure of most Western countries (IEF, 2015, 2018; Segaro, Larimo, & Jones, 2014; Jaramillo-Salgado, 2002), must also develop flexible capabilities to identify and respond to environmental changes given that it is a source of competitive advantage leading to success and survival (Rodríguez-Suárez, Pico-González, & Méndez-Ramírez, 2013; Zahra et al., 2008; Gulbrandsen, 2005). However, the uniqueness of family businesses means that they face a series of specific challenges -i.e. ownership structure, lack of professionalization, different firms´ objectives or specific resources they have at their disposal, among others (König, Kammerlander, & Enders, 2013)-, whose analysis has eclipsed the study of other relevant aspects of change and development (such as flexibility practices) in the family firm literature.

Key Terms in this Chapter

Systematic Review: A literature review that uses a systematic method to collect secondary data, analyze and appraise research studies, and synthesize studies.

Web of Science: A subscription-based service related to scientific citation indexing and searching powered by Clarivate Analytics. It gives access to multiple databases that reference cross-disciplinary research, which allows for in-depth exploration of specialized sub-fields within an academic or scientific discipline.

Strategic Flexibility: The capability of an organization to identify significant changes or instability caused by the external environment and act promptly, allocating resources to new courses of action in response to those changes.

Scopus: Elsevier´s abstract and citation database that covers book series, journals and trade journals from different fields, including life sciences, social sciences, physical sciences, and health sciences. Scopus gives different types of quality measures for each title: h -index, CiteScore, SJR (SCImago Journal Rank) and SNIP (Source Normalized Impact per Paper).

Manufacturing Flexibility: The ability of a manufacturing system to cope with changing circumstances or instability caused by the environment with little penalty in time, effort, cost, or performance.

Organizational Flexibility: The capability of an organization to employ customer-focused people at every level and build processes not only simple to execute but also flexible enough to survive and compete effectively with a changing environment.

SPSS: SPSS Statistics is one of the most popular statistical software used to solve business and research problems. It offers a range of advanced features, including access and management of data, ad-hoc analysis, hypothesis testing, or reporting and sharing of results.

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