The implications of firm size on process improvement strategy

Although firms must upgrade their manufacturing capabilities to remain competitive over time, successful process improvement implementation is uncertain. Furthermore, several internal characteristics such as the firm´s size and level of knowledge affect the magnitude and the certainty of the benefits realized. A comprehensive stochastic model is introduced which yields managerial insights concerning the impact of firm size on appropriate process improvement and knowledge acquisition strategies. Analytic results are derived linking firm size to relevant cost and efficiency advantages. Manufacturing managers can utilize the model to tailor appropriate process improvement and knowledge acquisition strategies for their firms