Identifying productivity blemishes in Pakistan automotive industry: a case study

Sarwar, Sheikh Zahoor; Ishaque, Azam; Ehsan, Nadeem; Pirzada, Danial Saeed; Nasir, Zafar Moeen

doi:10.1108/17410401211194671

Cited by 6 publications

(4 citation statements)

References 21 publications

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“…To enhance the explanatory value of the productivity variable, in future research, the following proven equations [94] may be used. Q = ALαKβ.…”

Section: Future Workmentioning

confidence: 99%

Sustainability Unleashed through Innovation: Knowledge-Driven Strategies Igniting Labor Productivity in Small- and Medium-Sized Engineering Enterprises

Khalil,

Malik,

Ahsan

2024

Sustainability

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This research is focused on knowledge-based performance drivers, which are often intertwined with intellectual capital (IC); specifically, the value-added intellectual coefficient (VAIC) and its profound influence on labor productivity (LP), with the pivotal inputs of training and research and development (R&D) as moderating, in the realm of small- and medium-sized (engineering) enterprises (SMEs). The aim is to offer this as a sustainable model for practical implementation to empower engineering managers, donors, and policy researchers. The motivation catalyzes more informed decision-making investing in human or structural capital. It attempts to foster sustainable growth and societal stability through job creation within the knowledge-intensive engineering sector of developing countries. Methodologically, the research draws upon statistical analysis, employing Pearson’s correlation, multivariate regression, and model testing executed through specialized statistical software. The World Bank Enterprise Survey Instrument was used to collect data on 213 aviation-related firms. Primary data were collected for the years 2013–2022. Several hypotheses were developed between the variables expected to relate positively, because intellectual capital, training, and research and development should lead to better labor productivity. The findings revealed the critical issue of the misallocated investments in structural capital that this model brought forth. Furthermore, the notable contribution to national intellectual capital (NIC) studies is the significant VAIC value of 4.58 and an impressive labor productivity value of 6.78 within the knowledge-intensive ecosystem of SMEs. More insightful findings were the modest 17% positive variation attributable to the VAIC on LP, accompanied by an absence of significant influence exerted by training and R&D on this relationship. While underscoring the model’s overall validity, this intriguing discovery emphasizes the impact of intangibles on knowledge firms’ overall sustainability calculations, specifically structural capital, which accounts for a substantial 31% of labor productivity. The practical implication is that this model can be used to expose long-term financial performance hiccups through intellectual capital measures. The novelty is employing the labor productivity metric sourced from the engineering literature instead of the customary asset productivity (ATO) ratio from the IC literature.

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“…To enhance the explanatory value of the productivity variable, in future research, the following proven equations [94] may be used. Q = ALαKβ.…”

Section: Future Workmentioning

confidence: 99%

Sustainability Unleashed through Innovation: Knowledge-Driven Strategies Igniting Labor Productivity in Small- and Medium-Sized Engineering Enterprises

Khalil,

Malik,

Ahsan

2024

Sustainability

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“…Zahoor Sarwar et al . (2012) studied the productivity status and trend in Indus Motors and Honda Atlas over a span of ten years, from 2000 to 2010.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Then, they calculated partial productivities such as labor productivity, material productivity, and capital productivity and total productivity. They found low levels of labor productivity and capital productivity causing huge losses and no growth in those firms (Zahoor Sarwar et al ., 2012). Since only two automotive manufacturing facilities were used (Indus Motors and Honda Atlas), the findings may not be generalized to many other automotive plants.…”

Section: Literature Reviewmentioning

confidence: 99%

Productivity enhancement in North American automotive industry

Abolhassani

Jaridi

2016

IJPPM

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Purpose The purpose of this paper is to identify effective factors, their impact, and find estimation models of the most well-known productivity measurement, hours-per-vehicle (HPV), in the automotive industry in North American manufacturing plants. Design/methodology/approach Data used in this study were from North American plants that participated in the Harbour’s survey from 2002 to 2006. Data are synthesized using a uniform methodology from information supplied by the plants and supplemented with plant visits by Harbour Consulting auditors. Overall, there are 355 manufacturing plants in the statistical sample from ten different automakers’ brands including DCX, Ford, GM, Honda, Cami, Nummi, Auto Alliance, Mitsubishi, Nissan, and Toyota. The multiple linear regression was used to analyze the data and derive the HPV regression equations. Findings HPV is a widely recognized production performance indicator that is used by a significant percentage of worldwide automakers. During the study period, the HPV was reduced 54.75 minutes on average in each year. Annual production volume, platform sharing (PS), and flexible manufacturing (FM) factors improve HPV. However, vehicle variety, salaried employees’ percentage of the workforce, available annual working days, and launching a new model penalize HPV. Launching a new model and adding a new variety in body styles or chassis configurations raise the HPV about 2.189 and 0.642 hours, respectively, depending on the car class; however, manufacturing plants compensate for this issue by using PS and FM strategies. Research limitations/implications The plants which stopped production of a specific product also are included in this study and were treated similar to the regular plants. The medium duty segment was excluded from the data set due to the fact that the number of observations available was too low. The study can be repeated with additional new factors such as the level of plants’ automation and lean manufacturing either for North American or European companies. Originality/value The research investigates current strategies that help automakers to enhance their production performance and reduce their productivity gap. HPV regression equations that are provided in this research may be used effectively to help car makers to set guidelines to improve their productivity with respect to internal and external constraints, strength, weakness, opportunities, and threats.

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“…While probing into the current scenario of automotive manufacturing industry its productivity and possible remedies to improving the productivity, Sarwar et al (2012) found that the effective usage of technology can enhance productivity. Tanveer et al (2012) during the investigation of declining market share of Pakistani football manufacturing industry mentioned that customers prefer those suppliers who can adopt quickly to new technology and simplified processes for production, cost reduction and those who possess the JIT capabilities with lower inventory.…”

Section: Literature Reviewmentioning

confidence: 99%

Critical elements in implementations of just-in-time management: empirical study of cement industry in Pakistan

et al. 2013

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In recent years, inventory management is continuous challenge for all organizations not only due to heavy cost associated with inventory holding, but also it has a great deal to do with the organizations production process. Cement industry is a growing sector of Pakistan’s economy which is now facing problems in capacity utilization of their plants. This study attempts to identify the key strategies for successful implementation of just-in-time (JIT) management philosophy on the cement industry of Pakistan. The study uses survey responses from four hundred operations’ managers of cement industry in order to know about the advantages and benefits that cement industry have experienced by Just in time (JIT) adoption. The results show that implementing the quality, product design, inventory management, supply chain and production plans embodied through the JIT philosophy which infect enhances cement industry competitiveness in Pakistan. JIT implementation increases performance by lower level of inventory, reduced operations & inventory costs was reduced eliminates wastage from the processes and reduced unnecessary production which is a big challenge for the manufacturer who are trying to maintain the continuous flow processes. JIT implementation is a vital manufacturing strategy that reaches capacity utilization and minimizes the rate of defect in continuous flow processes. The study emphasize the need for top management commitment in order to incorporate the necessary changes that need to take place in cement industry so that JIT implementation can take place in an effective manner.

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Identifying productivity blemishes in Pakistan automotive industry: a case study

Cited by 6 publications

References 21 publications

Sustainability Unleashed through Innovation: Knowledge-Driven Strategies Igniting Labor Productivity in Small- and Medium-Sized Engineering Enterprises

Sustainability Unleashed through Innovation: Knowledge-Driven Strategies Igniting Labor Productivity in Small- and Medium-Sized Engineering Enterprises

Productivity enhancement in North American automotive industry

Critical elements in implementations of just-in-time management: empirical study of cement industry in Pakistan

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