Adapting to dynamic conditions through continuous innovation in manufacturing

Abstract: The speed of change increases due to the pace of technological change and globalisation, and many industries that usually have acted in more stable settings will in the future act in more dynamic marketplaces. In order to be able to manage dynamic conditions, the organisation needs to continue delivering effectively in existing business areas while developing new systems, products and processes to take advantage of new opportunities in the future. This means that the organisation must be able to use abilities for exploitation and exploration simultaneously or, in other words, strive for continuous innovation including ambidexterity.In the traditional manufacturing industry, many companies use some sort of improvement programme for achieving operational excellence. Hence, a trend among multinational manufacturing companies is also to deploy and integrate corporate improvement programmes (XPS). These are based on lean production and inspired by the Toyota Production System. Generally, improvement programmes such as XPS largely support the development of exploitation capabilities but not exploration capabilities, which instead may have to stand back. Previous research states that these are problematic and complex issues that need to be further understood and developed. Therefore, more knowledge and support needs to be developed regarding how manufacturing companies can adapt their production systems to remain resource-efficient while simultaneously adapting to more radical changes.The overall purpose of this research project is to contribute to an increased understanding of how XPS integrations can be developed towards continuous innovation to be able to manage more dynamic conditions. Accordingly, the research objective is to develop recommendations supporting continuous innovation in manufacturing. An overall longitudinal study has been carried out containing five case studies at a manufacturing company integrating an XPS during dynamic conditions, i.e., with large variations in volumes and mixes of products together with the introduction of new products and production concepts. The studies conducted and the results are presented in five appended papers.The research shows there is a risk that the XPS concept is abandoned due to a lack of understanding of how the XPS contributes to solve the turbulent situation that appears under dynamic conditions. At the same time, it is important to develop and support exploration skills in parallel, as these abilities are not particularly well developed in this context. Furthermore, the research shows that a strategy formulation process striving for high involvement can be used as a means of creating ambidextrous capabilities.