Global, Local, Hybrid: Manufacturing in the Age of Disruption

Abstract

The economic landscape has drastically changed during the past decades, shifting from its local characteristics into a highly global decentralized manner. Nonetheless, the current supply chain disruptions such as the Covid-19 pandemic and materials shortages have imposed a significant challenge in terms of managing these distributed entities. Consequently, this research aims to construct a comprehensive understanding of the quintessential challenges, opportunities, factors, and technologies involved in the decision-making process of centralizing or decentralizing manufacturing systems. The research starts by conducting a condensed systematic literature review to analyze the existing publications on the subject topic and to determine the research gaps. Then, qualitative data was gathered by conducting semi-structured interviews with industrial experts in different fields to ascertain the relative importance of the main factors affecting the manufacturing positioning decisions. Additionally, the collected interview data was prioritized and thoroughly analyzed by utilizing the Analytical Hierarchy Process Methodology. The analysis showed that generic manufacturing positioning factors can be classified into primary and secondary factors. The primary factors consist of geopolitics & economic factors, capital costs, and accessibility to resources respectively; while secondary factors include market & business drivers along with flexibility, agility, and responsiveness which depend on the primary ones. Furthermore, a consolidated generic centralization vs decentralization decision-making framework has been proposed and validated.