| Firmperformance can be attributed to myriad extrinsic and intrinsic forces -- e.g. strategy, marketing, finance, operations, procurement and supply chain management -- that should ideally work together to provide firms a competitive edge. Although these disparate areas deserve equal focus and study, we recognize the changing landscape of the supply chain paradigm where an increasing number of global firms are opportunistically seeking broader market, procurement and production capabilities in facing consumer demand that is often quite difficult to predict. The challenges of meeting uncertain customer demand has spawned a broad literature that has explored the consequences associated with stockouts and mismanaged operational slack.;Moreover, the academic literature has routinely touted the benefits of prudent investment decisions, as originally cited byMichael Farrell in his seminal work that initially introduced summary performance measures for production. Parsimoniously utilizing these resources -- including labor, inventory, property, and innovative capital, all of which serve to generate sales and provide a return to the firm's stakeholders -- has been the accepted objective in operations management. However, managing supply chains and their embedded operations using such a context-invariant approach that universally seeks to minimize input slack was called into question in a widely-cited article byMarshall Fisher, who suggested that both supply chains and the products produced by them could be dichotomized into categories that move beyond the simple presumption that minimizing operational slack always leads to the best performance outcome for the firm. This work seeks to further explore that logic in showing empirically that, for certain industries and classes of companies, judiciously matching operational slack levels with the product environment can lead to better performance of the firm. Specifically, in markets that place more value on product innovation, minimum levels of operational slack might actually result in lower performance.;The motivation of this dissertation is thus to study the relationship between the factors of production and firmperformance.We recognize that finding general results across all industries might be challenging, so we carve the economic landscape into regions that differ by the extent of their focus on operational assets, and we then study the strength of the links between operational choices and financial performance at various levels of asset concentrations. Our approach provides a path for future research to explore such partitioning methods that seek to extract informative insights regarding firmperformance across different asset or investment concentration groupings.;The dissertation is structured as follows: Chapter 1 provides a general overview of our research problem and overarching question, and Chapter 2 explores our primary conceptual model empirically through an extensive regression analysis. Chapter 3 extends the analysis of Chapter 2 by utilizing data envelopment analysis as a precursor to empirically exploring the link between financial performance and operational choices. Chapter 4 elucidates on all key findings with an extension to suggest possible further areas of study. In aggregate, this discourse provides evidence on the hidden performance rewards surrounding the proper alignment of certain factors of production with product strategy. Our findings are strong and relevant, supporting current trends in research that seek to explore the causality link between operational decisions and firmperformance. Given the complexity of supply chain strategy, we hope this dissertation provides some prescriptive insight on the appropriate mix of operational levers to improve the chances of greater performance. |
