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Aligning Local Office Management Plan to Global Corporate Strategy
Ip-Shing Fan, Chia-Ping Huang
Cranfield University, Cranfield, Bedfordshire, MK43 0AL, UK
Email: firstname.lastname@example.org, email@example.com
Tel: +44 (0) 1234 754073; Fax: +44 (0) 1234 750852
This paper presents a framework for planning the deployment globalisation strategy in the local
office of global enterprises. The research aims to construct and validate a theoretical framework
to structure published knowledge on how to design management strategy to go global, and also
on how local management structure and decision-making can be harmonised with the corporate
strategy. Working with the local offices of two global PC component manufacturers, the authors
developed a novel framework incorporating both the context and content manufacturing strategy
approaches. The issues and factors could be systematically considered for successful
manufacturing globalisation strategy deployment. The deployment process uses traceable
reasoning to guide the local office in formulating its action plan. The knowledge and
understanding already captured in existing manufacturing research is thus made available to
local offices in a coherent way, so that they can evaluate and improve their business
Manufacturing for the global market may necessitate the setting up of offices in a range of
countries or regions that offer good business prospects. The local office may be a sales or buying
office, a distribution or service centre, or a fully equipped manufacturing facility. The
effectiveness of these local offices is crucial to the success of the global enterprise. Mechanisms
used to align the local operations with the global strategy vary greatly. Some enterprises just use
simple financial projections and reports as the management tool. This research aims to develop a
practical tool that the local office can use to develop strategic deployment plans aligned with the
global corporate strategy. The term ‘glocalisation’ (from global and localisation) is introduced to
refer to the creation of the local(country or regional) presence of a global enterprise.
In the context of global manufacturing, published work on globalisation focus on the nature and
form of globalisation. There is very little work that offers guidance on how the local offices
should design and run their operations. As manufacturing becomes global, the transferability of
strategy related theories and practices across national borders and different cultures has
increasingly become a matter of debate. Increasingly, researchers and practitioners arrive at the
conclusion that the exportability of managerial theories and practices is determined by the
compatibility between the exporting and importing nations.
There is a large body of research on management theory and practice that lies unused. In practice,
managers cannot easily make use of the published work in helping them to formulate strategy. On
the one hand, the sheer volume of literature makes it hard for managers to find and isolate what
may be relevant to their own particular context. On the other hand, published work often
prescribe the steps needed for strategy formulation but do not provide context appropriate
suggestions. The wealth of the research is locked away by the difficulty of its application.
This study attempts to investigate manufacturing strategy and action planning in the glocalisation
context. The focus is on the local units’ role as a strategic unit. The two main research objectives
• to construct a theoretical framework that structures existing manufacturing strategy
research in a form usable to industrial managers, in the context of globalisation
• to develop and test a strategy deployment workbook that the local office management can
use to set up improvement and operations actions that are aligned with the global
2. Manufacturing globalisation and local adaptation
Manufacturing globalisation is a complex concept that involves political, economic, technological
and socio-cultural changes. It is often seen not just as a one-way process with commands flowing
from the headquarters to the local units, but a two-way dynamic relationship between them.
Manufacturing enterprises react to the forces of globalisation by taking up new configurations.
Some researchers redefine the manufacturing scene as a globally distributed and coordinated
network, as distinct from the traditional plant model (Flaherty, 1996; Ferdows, 1997; Shi and
Gregory, 1998). Many studies suggest that multi-national corporations could be at a competitive
disadvantage if they do not think and act globally (Hout et al., 1982; Turner and Hodges, 1992;
Yip, 1995). Manufacturing globalisation is defined here as the study of the qualitatively different
nature of globalisation, the process by which a manufacturing enterprise builds its strategies and
competence to operate seamlessly across national boundaries on a global scale.
The style of corporate decision-making should determine how the local offices manage their
structure and resources. Little has been done to explore the linkages between strategic control and
local adaptation. Chung et al. (2000) concluded that with an open strategic style the role of the
subsidiary in the multinational corporation’s network is largely left to local managers to define
for themselves. This view assumes a high level of subsidiary autonomy. Global manufacturers
appreciate that global strength rests in part on local adaptation. Local differences are becoming
more important despite the ongoing globalisation of business. There has been some debate on
how far companies should adapt to local markets as opposed to maintaining a global image.
Historically, the companies with strong identities and business models, like Macdonald’s and
Coca-Cola, have a great competitive advantage and shun local adaptation. But, aside from these
world-leading brands, Hayes and Pisano (1996) have observed that to be successful there has to
be something more than the right match of manufacturing system to business objectives.
Otherwise, firms with identical technologies and similar business goals would perform more or
less equally. Local responsiveness is becoming more important because the process of local
adaptation creates the opportunity for sharing experiences company-wide, and for adaptation the
product in response to local demand.
A number of empirical studies have confirmed the importance of a strong role for manufacturing
within the hierarchy of corporate strategy for improving overall business performance. (Roth &
Miller, 1990; Marucheck, et al., 1990; Minor, et al., 1994). Anderson et al., (1991) stress that it is
difficult to argue against the importance of having an effective manufacturing strategy. In the
globalisation environment there is a need to clarify the issues of international manufacturing,
external drivers, and internal responses. Despite the emphasis put on the need for consistency
between manufacturing strategy and business objectives, this appears to be a gap in many firms.
This lack of alignment is a common problem that has received significant attention in the
literature (Porter, 1996; Swink and Hegarty, 1998; Tracey et al., 1999). Much of this failure has
been pinned on the actual practices of firms. Frequently, actual practice differs from strategic
intention. Often there appear to be two manufacturing strategies at work – the one that identifies
the plan and the one that has been implemented (Hayes and Wheelwright, 1984; Gupta and
Lonial, 1998; Platts et al., 1998). Many firms do not have mechanisms, that is, strategy
formulation and implementation processes, to bring about the desired alignment. Operational
decisions are carried out by reference to the firm’s “way of doing things”, rules built on past
experience, which may not be suited to the new situation. Further, the often alluded to pace of
technological change and market volatility tends to exacerbate misalignment. To apply these
academic research results, the differences of existing theories and models need to be clarified.
3. Existing theories and models differences
Although the existing models and theories may prove to be appropriate in particular situations, it
is still difficult to represent the strategic decision in both cognitive and practicable terms for
industries to follow. This is because global strategies are exercises in the unknown and further
complicated by the presence of a large number of other driving forces. Generalising,
manufacturing strategy studies adopt a deductive and top-down approach; provide a prescriptive
know-how process without the reasoning, and present detailed content and context at a strategic
level. This approach to strategy formulation limits the scope that local management can become a
team player and contribute its strategic strength.
Usually, a performance measurement model is goal-directed and uses inductive inference to align
measures to strategic goals. A brief summary of the manufacturing and performance measures
theory in the context of a glocalisation tool is in Table 1.
Manufacturing strategy approaches Performance measures models
Glocalisation dimension Strategic objectives, key issues Alignment to strategic goals
Framework reasoning Deductive Inductive
Content logic Causes and effects Goal directed
Context comprehensiveness Function based Model based
Process adaptability Know-how Know-how
Table 1 Manufacturing strategy and performance measures models
4. Research Process
A spiral research approach is designed to refine the framework that structures existing research
results into an applicable format. This research methodology uses three iterations to propose a
theoretical construct and then validate/test the framework with industrial input.
The first iteration develops an initial framework to structure manufacturing strategy deployment
into four stages. The structure is drawn from the Quality Function Deployment concept. An initial
framework is used to provide a common reference point for the different industrial managers to
express their glocalisation strategy requirements. Five cases companies were used for face to face
interviews at the companies’ sites to build an understanding of the manager’s glocalisation
decision process and the tools they use. These case companies were chosen through a range of
industries and geographic regions within Britain. The companies were not selected for their
ability to be representative of their sector but for the extensiveness of their manufacturing
glocalisation activities and willingness to be part of study.
The second iteration takes the requirements identified and develops the detail framework and its
application process. The detail framework uses seven viewpoints to structure knowledge gathered
from over 150 publications. The resultant framework consists of a set of relationship tables that
correlate 165 foci and 620 key issues. The industrial study to validate this framework requires in
depth support from managers of local offices. Gigabyte UK was invited and agreed to be the pilot
to evaluate the detail framework and the application process. Gigabyte (www.giga-byte.com) is a
leading PC main-board manufacturer with offices in USA, Western Europe, Russia and Australia.
It has nearly 4000 employees of which one third is ‘overseas’.
The large volume of information captured within the framework requires a structured and
efficient procedure for the company to follow. The third iteration develops the framework into an
embryonic workbook. Its usability as a strategy tool was validated with Gigabyte and another
company. The second company has similar characteristics and manufactures other PC
components. Both are representative of many young Multi-National Companies (MNC's) in the
Taiwanese IT component manufacturers. The evaluation shows that the framework is a feasible
strategy deployment tool. The validation approach is descriptive, the two case companies uses the
embryonic workbook to conduct glocalisation analysis. A key characteristic of these case studies
is the heavy investment of time to provide the longitudinal access and sharing the wealth of
experience. The workbook was refined through a sequence of trial studies with the participating
5. The reasoning structure of the proposed framework
The framework uses the viewpoints of competitive factors, policy area, CSFs, responsibility,
initiatives, operation tasks and actions. The reasoning structure of this glocalisation deployment
framework is described in Figure 1. The input into the glocalisation process is the stated business
objectives (BO) and the related strategy. The main elements of the proposed framework are the
seven viewpoints in three levels: first a macro level, then a medium level and then a micro level.
The policy, competitive factors are derived from manufacturing strategy studies as a top level
content directory. The CSFs, responsibility, and initiatives provide a further interpretation as a
middle level index. The operations tasks and actions represent operational level activities as a
micro level fact list.
These seven viewpoints are used to develop the company-wide integrated action plan. The policy
and competitive factors derived from manufacturing strategy provide a solid structured context to
be reasoned deductively. CSFs aim to identify the company’s strengths and local office
opportunities. Responsibility assignment aims to identify the appropriate department or function
to receive the authority and responsibility in the global company. The initiatives provide
directions for improvement actions. These three viewpoints diagnose the glocalisation domain to
identify the key issues, which are related to achieving the stated business objectives. These
medium level viewpoints also provide an extensive diagnosis of the operation tasks and action,
which can provide in-depth information.
Operations tasks provide a day-to-day activity checklist. Actions are additional activities aim to
implement the strategy and business objectives. The impact analysis aims to align actions with
strategy and helps to monitor the execution of actions. The analysis provides an inductive
reasoning approach to verify whether the provided content and context are applicable or not. The
reasoning structure aims to ensure that this framework provides an integrated and coordinated
mechanism to represent practical knowledge and select the appropriate strategic action plans.
Figure 1 The reasoning theory of the proposed framework
6. Scale of the proposed framework
A substantial body of work has been distilled into seven issues tables and nine relationship tables.
Despite a total of 165 foci and 620 detailed considerations in Table 3, the proposed framework is
maintainable. It has been structured for the users to select relevant issues and add their expertise
Viewpoints Focu Examples Key issues
Policy 45 Structure policy area 182
Competitive factors 9 Cost, quality, flexibility
CSFs 8 Agility, knowledge 37
Responsibility 15 Manufacturing, sales
Initiatives 10 Cost related, feature related 67
Operations tasks 72 Product, process analysis 192
Actions 6 New product, process 102
Total 165 620
Table 3 The main foci and key issues in the proposed framework
The local management can use the knowledge in these databases to support the strategy
deployment process. At each stage of the process, the management is presented with a range of
options from the databases. These options help the management to rationalise their choices. The
options could be selected if appropriate. For choices not in the option list, the framework has an
open structure to capture the decisions of the management team as additional options.
An example of a policy viewpoint is illustrated in Table 4. The policy areas are the areas of
strategic policy decision. For example, the policy area of capacity is related to the focus of
capacity planning; the related key issues are plant, equipment and labour to be provided within a
manufacturing system. Other capacity key issues include the identification of new facility, sub-
contracting agreements, outsourcing, capacity increment costs. The key issue list provides the
company with a comprehensive review of its strengths and weaknesses with respect to the
capacity decision area. From an examination of the literature covering the contents of
manufacturing strategy studies, it can be seen that a substantial number of these policy foci and
key issues can be regarded as macro level strategy references. The other viewpoints and
relationship tables are distilled in a similar way for further analysis.
Table 4 An example of policy viewpoints
7. Analysis process
Figure 2 presents the detail input and output of the four stages analysis process and illustrates
how the viewpoints work with the associated relationship tables. The detail process is explained
• Strategy analysis stage: the business objectives are mapped with the seven viewpoints
tables (from V1 to Table V7) to get a set of strategic viewpoints tables. Based on these
refined strategic viewpoints tables, a set of improvement operation tasks and actions are
derived from mapping with the relationship tables (from Table R1 to R9).
• Glocalisation analysis stage: using Table R1, the glocalisation challenges are translated
into the seven viewpoints to get a set of strategic glocalisation viewpoints tables. Based
on this information, a similar reasoning process infers a set of improvement operation
tasks and actions.
• Initiative actions analysis: the improvement actions and operation tasks are collected to
check for overlaps and gaps.
• Actions and impact analysis: the effectiveness and impact of the actions are evaluated by
using performance measures.
The validation process is an in-depth, longitudinal examination of an exploratory case study. It is
a systematic way of looking at what is happening, collecting data, analysing information, and
reporting the results. Hence, this validation approach is especially well suited to generating the
glocalisation scenario and testing the existing theories. The proposed framework and embryonic
workbook combine to provide a 'how-to' approach for glocalisation strategy deployment and
provide the database of issues that may be important to considered for I.T. manufacturers to set
up local offices in similar situations. An example of the actions selected by a case company is
illustrated in Table 5.
Actions Current status H.Q. aspect Gaps Policy areas
Q DL DR DF VF C I
New product Working with New product R&D ability is Working with H.Q. Product scope X
introduction vendors and qualified to be OEM Vertical Integration X
Product volume Promotion for the Increase production capacity Local responses Vertical Integration X
improvement phase-out product in China Production control X
and star product
MIS and operating Build-up I.T. system Improve MIS systems, Local responses Quality system X X
process improvement form H.Q. technical controls & reports Capacity X X
New product Working with R&D Improve product design H.Q. control Facility X X X X
development process to supply local quality and ability Vertical integration X X
Competitiveness Expand local market New product introduction Local responses Organisation X X
improvement – sale shares time to market improvement Human resources X X X
HR Resources Head-hunter Workforce with multiple, Local responses Human resources X
improvement company supports flexible skills Process & Tech X
Product standard Enhance RMA ISO 9000 implementation Working with H.Q. Quality system X X X
improvement services company-wide Human resources X
Distribution process Contract control and Improve distribution network Local responses Process & Tech X X X
improvement market survey and channel Quality system X
Competitiveness Marketing survey and New product introduction Working with H.Q. Human resources X
improvement – strategic alliance improvement Product Scope X X
Improve vendor Contract and deposit Improve distribution network Local responses Quality system X
quality control and contract management Human resources X X
Internet service Be compatible with Improve MIS support Working with H.Q. Product scope X X
build-up H.Q. MIS system Quality system X
Functionality design Report to H.Q. R&D Introduce computer-aid H.Q. control Vendor relation X
and manufacturing technology Process & Tech. X
Upgrade existing Control overhead I.T. infrastructure H.Q. control Production control X X
facility expenditures improvement Vendor relation X X
Site office set-up Closed to vendors Global branch offices set-up Local responses Facility X X
Improve H.Q. windows set-up Company Intranet build-up H.Q. control Organisation X
Office automation Overheads control Hardware set-up Local responses Facility X X
Inert-functional work Support from H.Q. Field services team build-up H.Q. control Human resources X X
Capacity expansions Market share Production bases build-up Local responses Capacity X X X
Worker training On-job training TQA training programmes Local responses Human resources X X
Financial (Budget) Software selection Evaluation and testing H.Q. control Financial X X
Table 5 An example of actions selection from case study
This research is an experiment to devise a structure and process to organise the vast amount of
existing manufacturing research results for practical application. A review of the manufacturing
strategy literature found evidence that a formalised approach is beneficial. With the structured
content and traceable context, local management can effectively formulate the strategy to contain
all the necessary primary and secondary improvement actions and the associated performance
This framework with four stages and seven viewpoints is developed to assist in assessing the key
considerations used by local management. The case studies demonstrated that it is feasible to use
the framework to effectively capture key issues and factors. It is also adaptable to accommodate
different requirements and operation patterns for glocalisation deployment. Another achievement
in this work is the ‘glocalisation’ manufacturing strategy deployment process and the prototype
workbook. Case companies find the traceable reasoning of the proposed framework effective to
guide their alignment of their local office management plan to the global corporate strategy.
Figure 2 The detail input and output of the analysis process
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