Development of performance measurement systems for core plants : Final report, Master's thesis 2017

Since the dawn of globalization, manufacturing companies around the world have been expanding their global footprint to stay competitive. International manufacturing network of a company consists of plants with different roles and responsibilities spread across different locations around the world. Due to this increasing geographical dispersion and competitiveness, effective co-ordination of these plants has become a priority along with achieving effective and efficient operations. This led to the development of the Core plant role. Core plants are the manufacturing plants that aims to achieve competitive and effective production, generate and transfer knowledge, while leading and coordinating the other plants within the network. However, the core plant role varies significantly across companies and academia due to a lack of a common understanding regarding its responsibilities and objectives. Furthermore, the performance of core plants are being measured with the same generic KPIs as the other plants, even though their roles and responsibilities varies significantly. As a result, it has become difficult to measure their true performance and contribution of value to the network. The purpose of this thesis is to contribute to the development of comprehensive performance measurement system that collectively measures the true performance and value of the core plant role to its international manufacturing network. Initially, the thesis investigates and bridges the mentioned knowledge gap with a two-tier literature review, before establishing their validity and relative importance in empirical context through survey. The survey approach is also utilized to assess the current situation of performance measurement among core plants of different manufacturing companies. The findings suggest that ‘attaining operational excellence’ has the highest strategic importance but this responsibility only extends to individual plant level not the network level. The cor