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The implementation of world class manufacturing techniques in Egyptian manufacturing firms An empirical study

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Salaheldin Ismail Salaheldin Department of Management and Marketing, College of Business and Economics, Qatar University, Doha, Qatar, and

Riyad Eid Wolverhampton Business School, Wolverhampton University, Wolverhampton, UK Abstract Purpose – The purposes of this paper are to illustrate how the world class manufacturing (WCM) techniques which could be described as outperforming the industry’s global best practices have been implemented in the Egyptian manufacturing firms, to identify the critical driving and resisting forces toward WCM techniques implementation in Egyptian manufacturing firms, and to provide guidelines for the successful implementation of WCM by Egyptian manufacturers. Design/methodology/approach – The data analyzed in this study are collected from a mail questionnaire sent to 200 manufacturing firms in Egypt. Findings – The findings of this study indicate that the Egyptian manufacturers are still in the 1970s and 1980s, when compared with world-class manufacturers. The most important variables that promote the implementation of WCM techniques are “reduced operating costs (marketing and production)” and “global issues (environment-market).” More importantly, the results of this study indicate that poor planning and lack of knowledge are the most significant barriers to WCM implementation in the Egyptian manufacturing sector. Research limitations/implications – There is a need to empirically explore the benefits of WCM implementation by the Egyptian manufacturing companies. Furthermore, more research is needed to study how the perceived importance of these drivers and barriers may differ across each industry such as manufacturing equipment, chemical and plastics, telecommunications, hardware equipment, textile industry, home equipment, scientific and medical equipment, management consulting, and software development. Practical implications – This study hopes to create more awareness among management and employees about the strategic importance of WCM techniques to operations processes in the Egyptian manufacturing firms. Originality/value – Although the last few years have witnessed phenomenal growth in WCM techniques, the underlying factors driving and inhibiting its diffusion are not well understood specially in the context of less developed countries in general and Egypt in particular. Therefore, this paper presents an empirical research that investigated the factors driving and inhibiting WCM implementation in Egypt and it provides insight into the strategies currently being adopted by Egyptian manufacturers in an effort to meet the challenge of obtaining WCM status. Keywords World class manufacturing, Manufacturing industries, Egypt, Developing countries Paper type Research paper

The authors sincerely thank the editor and the anonymous IMDS reviewers for their constructive and valuable comments and suggestions.

Industrial Management & Data Systems Vol. 107 No. 4, 2007 pp. 551-566 q Emerald Group Publishing Limited 0263-5577 DOI 10.1108/02635570710740698

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Introduction The rapid changes in business environment due to its unique characteristics, the raise of international competition among companies, shrinkage of markets, and diffusion of the IT through organisations have put pressure on businesses to continually review and adopt their traditional manufacturing strategy. In fact, there is a constant search for new ways to achieve a competitive advantage through new manufacturing techniques. Therefore, increasing knowledge and coordination of the company’s processes that crosses its manufacturing functions becomes a main requirement of many companies seeking a competitive advantage. Undoubtedly, a combination of external and internal factors including population growth, weak infrastructure, foreign debt, increasing inequalities between individuals, groups and regions has prevented many developing countries from achieving significant socio-economic improvements. Some developing countries such as Egypt have, therefore, made manufacturing management their prime agenda. They are going through a process of restructuring their manufacturing systems to emphasize competition, integration with global markets and increasing level of privatizations. Global competitors operating in global markets almost always tend to have world-class performance. World class manufacturing (WCM) has often been characterised by three core strategies of customer focus, quality, and agility (i.e. the ability to quickly, efficiently and effectively respond to change), and six supporting competencies; employee involvement (EI), supply management, technology, product development, environmental responsibility and employee safety, and corporate citizenship (Kinni, 1996). Thus, in order to compete in global markets, Egyptian manufacturing necessarily needs to acquire world-class performance. In fact, as is the case with many other new concepts in management, there is no consistent definition of WCM. The term “world class” was coined by Hayes and Wheelwright (1984) to describe the capabilities which had been developed by Japanese and German companies, as well as the US firms which had competed equally with the Japanese and German firms. The term “World Class Manufacturing” was used because these firms have achieved an outstanding performance in their global competition, resulting in their being described as “World Class”. However, the term became popular only after Schonberger (1986) discussed it as “ . . . .the term nicely captures the breadth and the essence of fundamental changes taking place in industrial enterprises.” WCM is one of the broadest philosophies focusing primarily on production. It includes, for example just in time (JIT), total quality management (TQM) and EI to achieve continuous improvement of a process. WCM also include more structural changes such as new production technology (Schonberger, 1986; Vokurka and Davis, 2004). Greene (1991, p. 14) gave an in depth definition for WCM companies which could be described as follow: WCM companies are those companies which continuously outperform the industry’s global best practices and which know intimately their customers and suppliers, know their competitors’ performance capabilities and know their own strengths and weaknesses. All of which form a basis of – continually changing – competitive strategies and performance objectives.

Although many writers have focused on the area of WCM since Schonberger’s work in 1986, very few of the studies have actually collected empirical evidence which would outline and highlight the important factors included within WCM. Furthermore, it was

discovered that only a few studies on WCM implementation in developing countries have appeared recently (Salaheldin, 2005; Saxena and Sahay, 2000). With this perspective, the main task of the current empirical study is to investigate the critical variables that are driving and inhibiting the implementation of WCM techniques in Egyptian manufacturing firms. Moreover, this investigation is seen as a principal step towards formulating strategies and tactics that remove and avoid many of the severe obstacles that impede the successful implementation of WCM philosophy on the road to achieving its potential benefits. Contribution to current knowledge The contribution of this study is threefold. First, the findings of this study contribute to operations management literature in general and to WCM literature in particular. This may provide some ideas for other researchers to execute more research in the field of the WCM techniques implementation. Second, there has not been any reported research of the implementation of WCM techniques in less developed countries in general, and in Egypt in particular. Thus, this paper represents a first attempt at reporting a story of the driving and resisting factors toward WCM implementation in the Egyptian industrial sector. Third, a very significant contribution of this study is to provide guidelines for the successful implementation of WCM by Egyptian manufacturers, and which can be used as a template for other manufacturing companies. Research questions and objectives To analyze the implementation of excellent manufacturing techniques by Egyptian manufacturing firms, the researchers developed two major questions: (1) What progress have Egyptian manufacturers made towards World-Class status and where are they currently? (2) What are the drivers that encourage Egyptian manufacturers to adopt these WCM strategies? And what are the difficulties which may prevent them from embracing such strategies? These were the overall questions to be answered by the current study; defined by the following three objectives to: (1) explore the current status of Excellent Manufacturing Techniques applications and management practices in Egyptian manufacturing; (2) identify the critical driving and resisting forces toward WCM techniques implementation in Egyptian manufacturing firms; and (3) provide guidelines for the successful implementation of WCM by Egyptian manufacturers. Literature review Overview of the definition of world class manufacturing The term “world class manufacturing” has been first introduced by Hayes and Wheelwright (1984). Since, then, various researchers have embraced and expanded this concept. WCM determines which set of activities needs to be undertaken by identifying

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what is needed by the companies to compete globally. Moreover, WCM itself involves many factors systematically related to promotion, for example, raw materials, energy, machinery, labour, and management. Furthermore, World Class companies optimise the problem-solving abilities of their employees in applying both modern techniques and traditional engineering process. According to Hayes and Wheelwright (1984), WCM is composed of six dimensions: workforce skills and capabilities, management technical competence, competing through quality, workforce participation, rebuilding manufacturing engineering, and incremental improvement approaches. By comparing the practices of Japanese and German manufacturers with US manufacturers, Hayes and Wheelwright claimed that the US plants must focus on these six broad categories of practices in order to achieve their WCM status. Schonberger (1986) provided a list of 16 principles of WCM which fall into eight categories: general, design, operations, human resources, quality and process improvement, information for operations and control, capacity, promotion and marketing. Schonberger actually asked managers to evaluate their own plants based on these 16 principles. He warned those plants that scored low on the 16 principles to identify their problems and make an effort to improve these practices to keep up with the competition. However, the phrase “world-class manufacturing” is one of the most overworked terms in management glossaries at present. Often, it is a name given to a novel development that is taking place in most competitive manufacturing operations across the globe. Schonberger (1987) used it to refer to many techniques and technologies designed to enable a company to match its best competitors. These techniques includes for example, JIT, quality circles (QC), Kanban, material requirements planning (MRP), flexible manufacturing system (FMS), computer aided design (CAD), computer aided manufacturing (CAM), computer integrated manufacturing (CIM), manufacturing resource planning (MRPII), total quality control (TQC), total productive maintenance (TPM)/Preventive Maintenance, TQM, simultaneous engineering, benchmarking, intelligent manufacturing, electronic commerce, business process re-engineering (BPR), enterprise resource planning (ERP), electronic data interchange (EDI) and supply chain management. Drivers and barriers to WCM implementation Drivers and barriers to WCM implementation in general have been classified in various ways. For example, Assiri et al. (2006), Avlonitis and Karayanni (2000), Eid and Trueman (2004) and Poon and Jevons (1997) talk about external drivers, i.e. global competition, international customers’ needs, developments in IT. Chan and Swatman (2000) includes internal drivers, i.e. changes in the organisational strategies and savings. Others talk about WCM barriers, i.e. need for cost justification, resistance to change, lack of management support, lack of knowledge, lack of appropriate monitoring and lack of employee education and training (Porter, 2001; Skinner, 1999). WCM implementation drivers External drivers, internal drivers, or both motivate WCM implementation. Naturally, external drivers relate to the increased level of global competition, the changes in the

international customers’ needs, recent developments in IT, and competition (Chan and Swatman, 2000; Cronin, 1996; Eid and Trueman, 2004; Hollensen, 2001; Poon and Jevons, 1997; Skinner, 1999; Hsu and Lin, 2006). Internal drivers are mainly related to changes in the organisational strategies and cost savings (Chan and Swatman, 2000; Cronin, 1996; Skinner, 1999). Perhaps, one of the strongest drivers is the increasing level of competition in the global markets. This has emphasised the need for organisations to innovate if they are to cope with global standards of products and services. Therefore, increasing knowledge and coordination of the company’s processes that cross its manufacturing functions become the main requirements of many companies seeking a competitive advantage. Gilgeous and Gilgeous (1999), Kasul and Motwani (1995), Kreitner (1995) approach the WCM as a tool to dramatically improve business performance and gain or maintain a competitive position. Similarly, Salaheldin (2005) and Saxena and Sahay (2000) also believe that WCM is driven by the never-ending needs of customers who are looking for better services and products. Finally, competitors’ use of the WCM techniques and their ability to respond to customers has a strong effect on the adoption of the WCM. On the other hand, technology drives organisational change at process, communications, and strategic level. Changes in organisational strategy may involve WCM use to bring about new strategic goals. For example, it may wish to broaden the use of existing electronic trading technology to include an advanced manufacturing technique as an alternative medium (Chan and Swatman, 2000). Reducing costs by substituting the WCM for other traditional techniques is yet another driver for WCM use since it is associated with cost savings. For example, Skinner (1999) states that sellers can obtain cost savings in “finding new customers” and “administration costs” generated through timesaving and the reduction in staff numbers. Barriers to WCM implementation There is a widespread recognition that WCM is a necessary technique for the achievement of competitiveness. It combines a system of knowledge, techniques, experiences, skills, and organisational characteristics that are needed to produce, utilise and control output. WCM is crucial to competition, because the techniques and resources it combines can create new opportunities. Such an approach is given added impetus by rapid technological changes and fierce competition, requiring Egyptian manufacturers to consider the adaptation of modern techniques which can be classified under the overall umbrella term of WCM. However, many authors have argued that WCM implementation has a number of limitations that are needed to be addressed in the manufacturing strategy (Hollensen, 2001; Porter, 2001; Skinner, 1999; Wilson and Abel, 2002). When implementing the WCM techniques, there may be different barriers: such as partial implementation of WCM techniques (Becker, 1993), overly optimistic expectations (Doyle, 1992) and implementation of WCM to conform to societal norms rather than for its instrumentality (Campbell, 1994). However, some of the prominent problems in WCM implementation include partial implementation, lack of a well-defined routine for attaining the objectives of implementation, cultural resistance to change, lack of training and education, and lack

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of organizational communication (Crawford et al., 1988; Becker, 1993; Patterson et al., 1995; Westphal et al., 1997). These problems reflect the lack of a clear understanding of what are the fundamental and complementary manufacturing practices. It can also be inferred that companies that encountered failure in their program implementation neglected the development of practices that support the implementation of WCM techniques. Moreover, Safayeni et al. (1991) contend that failure of WCM implementation is partly due to confusion over what exactly constitutes WCM and its implementation within an existing organization structure that does not provide the necessary support. The major barrier that will possibly affect WCM implementation is the inability of a company to coordinate its human resource practices, management policies and technology (Fredendall et al., 1997). Together, these problems reflect the lack of a system that supports the implementation of WCM programs. Research methodology Hypotheses This research is empirical and this characteristic stems from its objectives. Thus, in order to shed light on the status of the Egyptian manufacturing firms, implementation of WCM and factors which may influence the adoption of WCM techniques in an Egyptian context; it is important to consider the following hypotheses: H1. The most modern WCM practices are less implemented by the Egyptian manufacturing firms. H2. Basic drivers of WCM positively affect the implementation of the WCM techniques in the Egyptian context. H3. Basic barriers of WCM negatively affect the implementation of the WCM techniques in the Egyptian context. Research instrument development – measures The development of the research instrument was based mainly on new scales, because we could not identify any past studies directly addressing all of the issues in this research. However, and where possible, we used validated measures that have been previously applied. The constructs, scale items and factor loadings obtained from exploratory factor analysis are presented on the data analysis section. Two consecutive rounds of pre-testing were conducted in order to insure that respondents could understand the measurement scales used in the study: first, the questionnaire was reviewed by three academic researchers experienced in questionnaire design and next, the questionnaire was piloted with two WCM experts known to the researchers. The pilot took the form of an interview where the participants were first handed a copy of the questionnaire and asked to complete it followed by a discussion on any comments or questions they had. The outcome of the pre-testing process was a slight modification and alteration of the existing scales, in light of the scales context under investigation. The pilot work was undertaken in August 2005. Based on the results and comments from the pilot tests, revisions were made to the questionnaire design. The formal survey was conducted between January and April 2006. A total of 200 manufacturing firms in Egypt were selected as the samples of the survey.

Instrument validity and reliability Discriminant validity was assessed using factor analysis. The 17 items (variables) measuring the WCM drivers and barriers were subjected to principal component factor analysis. Eigenvalues and scree plot were used to determine the number of factors to be extracted. Moreover, in order to ensure the use of factor analysis, the Berlett test of sphericity (BTS) and Kaiser-Meyer-Olkin (KMO) test of appropriateness were carried out accordingly (Table I). The result (BTS was 1,625.44 and the level of significance at P ¼ 0.000) indicated that the data are appropriate for the purpose of factor analysis. Statistically, this means that there exist relationships between the variables and that they can be appropriately included in the analysis (Bryman, 1989). The result of sampling adequacy was 0.940 which, following Kaiser-Meyer-Oklin measure of sampling adequacy, reflected high sampling adequacy. The 17 items loaded on the two factors as suggested using the criteria of an eigenvalue greater than 1 and the extracted factors account for 72.077 of the total variance (Table II). A viramax rotation was also performed. All items loaded onto the expected factors as they were originally designed. Factors loading were higher than 0.5 on its own factors. As suggested by Hair et al. (1998), a factor loading higher than 0.35 is considered statistically significant at an a level of 0.05. The reliability of the constructs was assessed by the Cronbach a reliability coefficient and exceeded Nunnally’s standards for research (Nunnally, 1978) (Table III).

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The sample The mail survey questionnaire that was sent to 200 manufacturing firms in Egypt focused on company characteristics, human modification efforts to be undertaken prior to WCM implementation and WCM implementation drivers and problems. The survey population of this study is defined as all Egyptian manufacturing companies (200 companies) in the Egyptian ex-public industrial sector[1]. The target respondent in each company was the production manager or materials manager. All the selected companies had implemented at least one of the WCM techniques at least one year ago. A research packet, which contained a covering letter and an anonymous (self-administering) questionnaire, was mailed to the head of production departments; production managers, or material managers (200 in total). This procedure resulted in 96 useful responses or a 48.00 percent overall response rate.

Kaiser-Meyer-Olkin measure of sampling adequacy 0.940

Factor 1 2

Bartlett’s test of sphericity Approx. x 2 df Sig. 1,625.440

136

0.000

Eigenvalue

Variance explained (percent)

Cumulative variance (percent)

11.124 1.129

65.436 6.641

65.436 72.077

Table I. KMO and Bartlett’s test

Table II. Total variance explained

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Table III. Factor loading and Cronbach’s a analysis

Factor loading WCM drivers Global issues (environment-market) Local competitiveness Government pressures Economical justification Reduced operating costs (marketing and production) Improving the range and quality of services Take advantage of being an early adopter Avoiding losing market share to competitors who are already implementing WCM B-to-B IIM Barriers Need for cost justification Resistance to change Lack of management support Poor planning Lack of knowledge Lack of appropriate monitoring Lack of employee education and training Lack of employee motivation Lack of communication

Cronbach a 0.945

0.685 0.857 0.800 0.718 0.742 0.739 0.535 0.758 0.944 0.624 0.618 0.731 0.770 0.786 0.640 0.833 0.618 0.807

The sample can be described as follows: a majority of the respondents were involved on WCM implementation (69.81 percent), few were younger than 40 years old (16.7 percent), and the majority (approximately 47.9 percent) were more than 50 years old. With respect to number of employees in each company, approximately 46.9 percent of the sample had more than 1,000 employees, 22.9 percent had 501-1,000 employees, 16.7 percent had 101-500 employees and only 13.5 percent had only less than 100 employees. In terms of the production sector, 27.1 percent of the respondents were members of engineering and electronic sector, 27.1 percent were food companies, 19.8 percent were chemical companies, 11.5 were textile companies 9.4 percent were working in the mining industry and only 5.2 percent were producing wood products. Finally, more than half of the respondents hold the position of operation manager in their companies (58.3 percent). On the other hand, 17.72 percent hold the position of marketing manager, 11.5 percent hold the position of Purchasing and 12.5 percent are IT manager. To ensure that the valid responses were representatives of the larger population, a non-response bias test was used to compare the early and late respondents. x 2 tests show no significant difference between the two groups of respondents at the 5 percent significance level, implying that a non-response bias is not a concern. Data analysis The findings of the survey The interpretation of the two-factor solution was accomplished by relating them to theoretical concepts of production and operation management. The first factor seems to fit very well with the WCM drivers since all the elements such as “global issues (environment-market)” “government pressures,” “local competitiveness,” “economical justification,” “reduced operating costs (marketing and production),”

“improving the range and quality of services,” “take advantage of being an early adopter” and “avoiding losing market share to competitors who are already implementing WCM” suggest a very strong incentive for WCM implementation. Here, the most important variables are “reduced operating costs (marketing and production)” and “global issues (environment-market).” This supports other research findings that WCM is driven by the never-ending needs of companies to reduce their costs and to meet the global standards (Kasul and Motwani, 1995; Kreitner, 1995; Salaheldin, 2005; Saxena and Sahay, 2000). On the other hand, WCM promises significant savings in costs, such as making it cheaper to find new customers, lower administration costs generated through time saving and the reduction in staff numbers. The second factor, WCM barriers reveals the elements that are likely to detract from WCM implementation. Here, poor planning and lack of knowledge are the most significant variables. Similarly, “need for cost justification,” “resistance to change,” “lack of management support,” “lack of appropriate monitoring,” “lack of employee education and training,” “lack of employee motivation” and “lack of Communication” are all barriers for using the WCM techniques. Thus, this factor was labelled WCM barriers. Testing hypotheses Manufacturing techniques used by the Egyptian companies. The first hypothesis (H1) focused on the current WCM practices that are considered to be implemented by the Egyptian manufacturing firms. According to Table IV, the results are found to be very different from the mid-point 3.0. JIT purchasing was the practice most implemented (mean ¼ 3.7292), JIT production came second with a mean of 3.2396, TQM came third (mean ¼ 3.0833) and MRP are the fourth used technique by the Egyptian manufacturers (mean ¼ 3.0729). On the other side, the least implemented techniques were group technology/cellular manufacturing (mean ¼ 1.1667), followed by CAD (mean ¼ 1.1771) and CAM (mean ¼ 1.1771). These results support the first hypothesis that the most modern WCM practices are less implemented by the Egyptian manufacturing firms. This actually leads the Egyptian manufacturers to apply older techniques that lie under umbrella of mass production approach (the 1970s and 1980s techniques). WCM drivers and barriers The second and third hypotheses focused on the association between WCM drivers and barriers and potential WCM techniques implementation. A one-sample test was conducted to determine whether these observed means of the WCM drivers and barriers are significantly different from the mid-point 3.0. The results are given in Table V. According to Table V, the results are found to be very significantly different from the mid-point 3.0 ( p , 0.01). This confirms that all the WCM drivers are in the positive side and WCM barriers are in the negative side. Furthermore, the second and the third hypotheses can be expressed in a multiple linear regression equation as: WCM Successful Implementation ¼ Constant þ B1 WCM Basic Drivers þ B2 WCM Basic Barriers þ 1

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Table IV. Extent of WCM implementation

Manufacturing techniques

N

Mean

SD

Std. error mean

Quality circles (QC) Just in time (JIT) production JIT purchasing Kanban Material requirement planning (MRP) Flexible manufacturing system (FMS) Computer aided design (CAD) Computer aided manufacturing (CAM) Computer integrated manufacturing (CIM) Manufacturing resource planning (MRPII) Total quality control (TQC) Total productive maintenance (TPM) Time to market Logistic management Optimised production technology Total quality management (TQM) Group technology/cellular manufacturing Simultaneous engineering Benchmarking Intelligent manufacturing Electronic commerce Business process re-engineering (BPR) Enterprise resource planning (ERP) Electronic data interchange (EDI) Supply chain management

96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96 96

1.2188a 3.2396 3.7292 1.7604 3.0729 1.2083 1.1771 1.1771 1.2396 2.9896 1.3229 1.30208 1.2604 1.3021 1.2500 3.0833 1.1667 1.2917 1.3646 1.3438 1.3438 1.3854 1.2813 1.2500 1.3229

0.41557 0.66086 0.88828 0.42907 0.56652 0.40825 0.38374 0.38374 0.42907 0.67270 0.55241 0.564191 0.52805 0.50513 0.52315 0.49559 0.40175 0.50088 0.65083 0.62959 0.59521 0.63858 0.49637 0.48123 0.55241

0.04241 0.06745 0.09066 0.04379 0.05782 0.04167 0.03917 0.03917 0.04379 0.06866 0.05638 0.057582 0.05389 0.05155 0.05339 0.05058 0.04100 0.05112 0.06642 0.06426 0.06075 0.06517 0.05066 0.04911 0.05638

Note: aBased on a five-point Likert scale (n ¼ 96)

To investigate the hypotheses, entering all variables in a single block, we found that the proposed model explains a significant percentage of variance in WCM successful implementation. Table VI shows that 81.3 percent of the observed variability in the WCM Successful Implementation is explained by the two independent variables (R 2 ¼ 0.813, Adjusted R 2 ¼ 0.809). To test the equivalent null hypothesis that there is no linear relationship in the population between the dependent variable and the independent variables, the ANOVA in Table VII is used. Results from Table VII shows that the ratio of the two mean squares (F) was 202.135 (F-value ¼ 202.135, P , 0.001). Since, the observed significance level was less than 0.001, the two variables influence manufacturers’ attitudes toward implementing the WCM techniques. To test the null hypothesis that the population partial regression coefficient for a variable is 0, t-statistic and its observed significance level were used. The results are shown in Table VIII. Results from Table VII indicate that we can safely reject the null hypotheses that the coefficients for WCM basic drivers (B ¼ 0.618, t ¼ 5.867, p , 0.001) and WCM Basic Barreirs (B ¼ 2 0.304, t ¼ 2 2.885, p , 0.01) are 0. The b weights show that WCM basic drivers (B ¼ 0.618) have a strong significant positive influence on WCM success. Similarly, the b weights show that WCM basic barriers (B ¼ 2 0.304) have a

Global issues (environment-market) Local competitiveness Government pressures Economical justification Reduced operating costs (marketing and production) Improving the range and quality of services Take advantage of being an early adopter Avoiding losing market share to WCM competitors Need for cost justification Resistance to change Lack of management support Poor planning Lack of knowledge Lack of appropriate monitoring Lack of employee education and training Lack of employee motivation Lack of communication

5.923 7.363 7.685 7.266 4.094 6.951 5.772 6.485 2 5.796 2 7.795 2 4.840 2 6.281 2 3.557 2 6.944 2 7.913 2 5.809 2 7.325

T 95 95 95 95 95 95 95 95 95 95 95 95 95 95 95 95 95

df 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.001 0.000 0.000 0.000 0.000

Sig. (2-tailed) 0.80208 0.90625 0.94792 0.92708 0.50000 0.81250 0.75000 0.75000 20.69792 20.98958 20.65625 20.71875 20.39583 20.84375 21.03125 20.75000 20.94792

Mean difference

Test value ¼ 3

1.0709 1.1506 1.1928 1.1804 0.7424 1.0446 1.0080 0.9796 2 0.4589 2 0.7375 2 0.3871 2 0.4916 2 0.1749 2 0.6025 2 0.7725 2 0.4937 2 0.6910

0.5332 0.6619 0.7031 0.6738 0.2576 0.5804 0.4920 0.5204 20.9370 21.2416 20.9254 20.9459 20.6168 21.0850 21.2900 21.0063 21.2048

95 percent confidence interval of the difference Lower Upper

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Table V. One-sample test

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strong significant negative influence on WCM success. Multicollinearity between the independent variables was minimal, as shown by the values of tolerance (0.182) and VIF that was less than ten (5.510) indicating that the results were reliable. These results support the second and third hypotheses (H2 and H3).

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Discussion The results of this study indicate that the Egyptian manufacturers are still using the mass production philosophy. When asked about their extent of implementing the results were: “Just in Time Purchasing and Production (JIT)” was the practice most implemented by the Egyptian firms, followed by “Total Quality Management (TQM)” and then MRP. These results support the findings of Green and Inman (2005), Kros et al. (2006) and Mistry (2005) studies that the JIT philosophy and associated practices are alive and well within the manufacturing sector. Furthermore, the most modern practices to emerge in the 1990s were considered as the least performed by the Egyptian manufacturers which mean that they are still dominated by the old style “mass production theme” and have not yet been touched by the new world class theme of “mass customizations.” These findings indicate that the Egyptian manufacturers are still in the 1970s and 1980s when compared with world-class manufacturers. It can be concluded that non-awareness of new practices such e-commerce, EDI, lean production, ERP, and supply chain management can guarantee that Egyptian manufacturers will fall apart Model

Table VI. Model summary

R

1

0.902

a

Std. error of the estimate

0.813

0.809

0.50634

Note: Predictors: (constant), WCM barriers, WCM drivers

1

Regression Residual Total

Sum of Squares

df

Mean Square

F

Sig.

103.646 23.843 127.490

2 93 95

51.823 0.256

202.135

0.000a

Note: aPredictors: (constant), WCM basic drivers, WCM basic barriers

Model Table VIII. Results of regression coefficientsa

Adjusted R 2

a

Model

Table VII. Summary of ANOVA

R2

Constant WCM basic drivers WCM basic barriers

Unstandardized coefficients

Standardized coefficients

B 1.773 0.690 2 0.305

b

Note: aDependent variable: WCM implementation

0.618 20.304

T-value

Sig.

2.706 5.867 2 2.885

0.008 0.000 0.005

Collinearity statistics Tolerance

VIF

0.182 0.182

5.510 5.510

after WTO ascension. In other words, it will keep them too far behind from any competitive advantage that can be acquired in the manufacturing world today. Considering the WCM drivers and barriers, the results of this study are consistent with previous studies such as Feldman (1991), Ozatalay and Saad (1988), Rohan (1990), and Steudel (1992) who see that WCM implementation is driven by the never-ending needs of customers to look for better services and products. However, all B-to-B IIM drivers are in the upper end of Likert scale. Similarly, the need to avoid losing market share to competitors is a key incentive, since this research has found that competitors’ use of the WCM and response to customers also has a strong, (driving) effect on the adoption of the WCM techniques. At the same time, the need to improve the “range and quality of services” relates to Chan and Swatman (2000) who found that IT developments are forcing organisations to be up-to-date in their use of advanced technologies regarding the production and delivery of speedy and high quality information, as well as facilitating greater degrees of communication and integration across business units and external partners. To sum up, the Egyptian manufacturing firms are driven to adopt the WCM techniques because of the incentives or gains achievable through the use of these new techniques where advantages outweigh disadvantages regardless of the barriers that might decrease its use. Conclusions and managerial implications WCM has emerged as a result of many business drivers. Firstly, the changes in the driving forces for manufacturing strategy, from an initial push to improve current business processes to achieve savings and improve efficiency, the companies have come to be driven by a desire for greater supplier involvement and customer service in later implementation which lead to the adoption of mass customisation production philosophy. Secondly, competitors’ use of the WCM techniques and response to customers also has a strong effect on the adoption of the most advanced WCM techniques for the production purposes. Thirdly, as a result of its growing ability to bring new opportunities and to facilitate the development of the new organisational forms and structures needed to meet the continuously emerging changes in business imperatives, the WCM importance increases as it becomes involved in each task in today’s business. Finally, IT developments are also forcing organisations to be up-to-date in their use of advanced technologies regarding delivery of speedy and high quality information, as well as facilitating greater degrees of communication and integration across business units and external partners. On the other hand, implementing the WCM has many barriers especially in less developed countries. Lack of employee education and training, resistance to change, lack of communication, lack of appropriate monitoring, lack of employee motivation have been found to be the most important barriers to implement the WCM techniques in Egypt. Therefore, training programmes that increase the awareness of the manufacturing firms and prepare the employees to the potential change required by the WCM techniques is a very critical requirement in this stage, if the Egyptian government needs to achieve success in this important issue. One of the main objectives of this study was to provide some guidelines that might be of importance to promote WCM techniques implementation in the Egyptian industrial sector. Based on the results of this study, the following managerial implications are drawn:

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The Egyptian manufacturer should acknowledge that the aim of being world-class is not merely a matter of simply reducing costs; it is, in fact, the ability to link the manufacturing capabilities with market requirements to enhance the firm’s performance in order to satisfy its customers. Based on the results of this study, lack of employee education and training is the most important barrier to implement the WCM. Therefore, world-class practices should be implemented through a process of mature learning, and not be used as a quick fix reaction to a problem. Because, the implementation of WCM techniques takes a long time, manufacturing firms that are willing to implement them should be patient and persistent until the expected benefits of WCM techniques implementation are obtained. The Egyptian manufacturers must think globally. The consequences of not doing so would be a penetration of their own markets by overseas competition. They must also expect more complexity in business, products, and process. Policy makers in the Egyptian industrial sector should enhance the capability of manufacturing firms that are willing to implement WCM techniques through increased funding, grants, incentives, and educational programs.

Recommendations for further research A logical progression of this study would be to carry out a similar study concerning the private sector the results of which could be compared with this research. The same proposed drivers and barriers developed by the current study could be employed in such a study. Furthermore, more research needed to study how the perceived importance of these drivers and barriers may differ across each industry such as manufacturing equipment, chemical and plastics, telecommunications, hardware equipment, textile industry, home equipment, scientific and medical equipment, management consulting, and software development. With a better understanding of these issues involved in WCM, managers will be able to make informed decisions and allocate the necessary resources to make WCM implementation a success in the long-term. Moreover, this research could be enhanced by expanding the current driving and resisting forces. The impact of organizational culture on WCM implementation could be investigated to add further depth to those forces. Finally, similar studies in other developing countries could be carried out and comparative studies with other less developed countries could be also carried out to find out the similarities and dissimilarities concerning the driving and resisting forces toward WCM implementation in different contexts. Note 1. Firms were identified from two sources: the general organization for industrialization (GOFI) of Egypt and the gyptian industrial chambers. References Assiri, A., Zairi, M. and Eid, R. (2006), “How to profit from the balanced scorecard: an implementation roadmap”, Industrial Management & Data Systems, Vol. 106 No. 7, pp. 937-52.

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