The purpose of this paper is to investigate the strategic role of plants, in terms of the type and level of site competence, the relationship with the strategic reason for location, and the impact on operational performance.
The authors use a survey of 103 Swedish manufacturing plants that belong to global production networks and analyze patterns within this context to identify potential archetypes of plants with respect to plant roles, based on factor analysis and cluster analysis.
It is found that the areas of site competence can be grouped into three bundles, characterized thematically as production‐related, supply chain‐related and development‐related. The plants fall into three categories: some plants have only production‐related competences, some have competences concerning both production and supply chain, and the third group of plants possesses all three bundles of competences.
The results provide empirical evidence that site competences come in bundles in three steps according to themes rather than individually. No significant relationship was found between the level of site competence and the strategic reason for site location.
The results provide empirical support for the co‐location of product development and production, since plants with full responsibility for all competence bundles significantly outperform plants having only production‐related competences on cost efficiency, quality, and new product introductions.
The authors research patterns of site competence at a more detailed level than before in the related literature, as well as study the impact on performance, which has not been done before.
