Effectiveness of Organizational Responses to Technological Change in the Production Process

Abstract

This paper examines the effectiveness of organizational problem solving in response to technological change in the production process. First, the paper measures the degree of uncertainty associated with a given technological change by examining (1) the novelty of specific new features and functions, and (2) the required departure from established operating assumptions and organizational relationships. Second, the paper identifies three modes of problem solving that organizations use in dealing with technological change: modification prior to implementation (preparatory search), joint work with external technical experts during production start-up (joint search), and integration of engineering and manufacturing functions engaged in start-up (functional overlap). The effectiveness of these approaches is then tested on a sample of 48 new process introductions undertaken in eight plants by a leading global producer of precision metal components. Results indicate that the measured characteristics of technological change are significant predictors of the difficulties encountered in introducing new process technology. Findings also suggest that intensive problem solving efforts can significantly improve change outcomes, both shortening the period of disruption experienced and increasing the operating gains achieved. In addition, there was some evidence that the three organizational problem solving activities discussed here are not equally effective for responding to all types of process change. Specifically, the higher the level of technical novelty involved, the less useful was overlap between engineering and manufacturing functions. This challenges the general prescription that cross-functional team involvement in major technical projects always should be maximized, regardless of the nature of the change involved.