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Alignment of
Alignment of operations strategy: operations
exploring the marketing interface strategy
Celeste Jose Zanon
Department of Production Engineering, 207
UNESP – Universidade Estadual Paulista (The Sao Paulo State University),
Bauru, Brazil Received 28 April 2012
Revised 13 July 2012
Alceu Gomes Alves Filho 16 September 2012
Department of Production Engineering, UFSCar – Universidade Federal de Accepted 16 September 2012
Sao Carlos (Federal University of Sao Carlos), Sao Carlos, Brazil, and
Charbel Jose Chiappetta Jabbour and
Ana Beatriz Lopes de Sousa Jabbour
Department of Production Engineering,
UNESP – Universidade Estadual Paulista (The Sao Paulo State University),
Bauru, Brazil
Abstract
Purpose – The purpose of this paper is to identify factors that can help managers to overcome
barriers to alignment of operations strategy at the interface with marketing.
Design/methodology/approach – This objective required the application of a procedure based on
strategic consensus and a deeper analysis, such that the delimitation of the study in a single case was
mandatory. The strategic processes of interfacing involve managerial attributes that are subject to the
influence of human aspects and, therefore, the research method used a qualitative approach. The
protocol design included the following data sources: interviews, document reviews and researcher
observations. The categorisation was made based on the theoretical references, the frequency of
observations, common responses and information from documents.
Findings – The balance between intra-functional trade-offs, joint research on the competitive context,
reflections on the understanding of customer needs and operational performance, and understanding of
inter-functional trade-offs were the main factors verified. They effectively support decisions associated
with interface processes and promotes the integration of these processes. They can generate inputs that
enable managers to achieve an appropriate balance among alternatives in light of various trade-offs.
Practical implications – These factors make possible new connections between strategic processes
in the context of operations and marketing functions. The formations of these strategies are aligned
through a better understanding of both threats and opportunities by means of a joint analysis of the
competitive context. The presented findings can be used to develop a clear definition of strategic
objectives of operations and a more appropriate treatment of market needs.
Originality/value – The findings from the research can be considered as new elements for promoting
alignment in the formation process of the operations strategy. Little research to date has examined the
operations-marketing strategic interface of companies in the context of strategic consensus.
Keywords Operations management, Strategic alignment, Operations-marketing interface,
Operations strategy, Strategic consensus, Strategic interface
Paper type Research paper Industrial Management & Data
Systems
Vol. 113 No. 2, 2013
The authors are grateful to Dr Binshan Lin for managing their submissions and two anonymous pp. 207-233
q Emerald Group Publishing Limited
reviewers for their valuable feedback on earlier versions of this paper. This research was 0263-5577
supported by Sao Paulo Research Foundation (FAPESP) – Brazil (2010/11553-2). DOI 10.1108/02635571311303541
IMDS 1. Introduction
113,2 Operations strategy alignment is intrinsically associated with the marketing interface,
because sustainable alignment depends on the interpretation of changing market needs
and the rapid adaptation of operational resources. Achieving such alignment means
reaching a proper balance between the performance demanded by the market and the
actual performance of those operations (Slack and Lewis, 2008). Such balance is
208 associated with interactions among managers of set functions, and in practice, many
conflicts exist between marketing and operations according to the relevant literature.
According to Erickson (2010), in the development of their dynamic strategies, the
marketing and operations functions within a firm have differing objectives, and
conflict between the two functions is common. Generally, the reasons for the conflicts
are the trade-offs involved in the effort to balance competing priorities (Paiva, 2010;
Tang, 2010). Such functional discordance has prompted studies (Gulledge, 2006;
Decoene and Bruggeman, 2006; Brown et al., 2007; Swink and Song, 2007) and led to
“frameworks” (Walters, 1999; Malhotra and Sharma, 2002; Douglas and Strutton, 2009)
regarding the interface between operations and marketing. However, recent studies
(Tang, 2010; Mollenkopf et al., 2011; Oliva and Watson, 2011) show that despite the
evolution of interface research in recent years, serious strategic issues remain that
affect organisational performance because of the failure of adequate operational
resources for market needs.
Several researchers have suggested that strategic interface management is a key
factor for improving business performance (Hill, 2005; Tatikonda and Montoya-Weiss,
2001; Hsu and Chen, 2004; Swamidass et al., 2001). This management is generally
associated with alignment, speed, consensus and coordinated decisions.
Therefore, identifying factors that can help managers overcome obstacles in
operation strategy alignment at the interface with marketing has significant theoretical
and practical implications.
In this context, the research question is as follows:
RQ1. What factors can help managers overcome obstacles in operation strategy
alignment at the interface with marketing?
The answer to RQ1 helps to fill some of the gaps mentioned in the relevant literature
regarding the alignment of operations and its interface with marketing. Therefore, this
paper contributes to our understanding by examining trade-offs between marketing
plans and operations in accordance with the necessity described by Tang (2010); this is
achieved by identifying factors that may break historic barriers that arise during the
formation of strategies based on the theoretical gaps mentioned by Paiva (2010) and by
investigating the strategic alignment of operations as proposed by Swamidass et al.
(2001), considering that production managers are less likely to participate in strategic
process phases than marketing managers.
To achieve such an original contribution, the methodology needs to focus on
managerial interactions that arise during the discussion of strategic issues; such a focus
is rare, considering the difficulty of obtaining permission from these organisations for
the researchers to observe these interactions. Another initiative for achieving an
innovative contribution to the area was to apply a procedure based on strategic
consensus to support data collection. Few procedures foster strategic consensus and
procedures that address the interface between operations and marketing are rare.
This work is organised as follows: Section 2 describes theoretical frameworks Alignment of
regarding operation strategy alignment, the interface between operations and marketing, operations
and strategic consensus. Section 3 presents the methodology used. In Section 4, the results
are presented and discussed. And finally, Section 5 presents the conclusions of the study. strategy
2. Conceptual background
While recognising the importance of interface processes with marketing for operation 209
strategy alignment, working with two theoretical bases (alignment and interface with
marketing) would not be sufficient because of the different interests and paradigms
present in the daily relationship between professionals having both functions. Therefore,
we decided to make use of a third theoretical basis that could help us to analyse the
conflicts not only as barriers but also as opportunities for achieving higher levels of
alignment. The concept of consensus not only aids in the analysis regarding the shared
understanding of market needs and the suitability of operational resources but also aids
in understanding the influences of managerial perceptions on decision-making processes.
The conceptual background of this research is presented in three sections. We begin
with an overview of the literature on the alignment of operations strategy (Section 2.1) and
next describe the key tenets from the literature on operations marketing interface
(Section 2.2), strategic consensus (Section 2.3) and the conceptual research model
(Section 2.4). This theory was used to develop our research design as described in Section 3.
Marketing Operations
Understanding the
Alignment of conflicts not only as
Operations barriers but also as
Strategy opportunities to
achieve higher
levels of alignment.
Understanding of Shared
barriers to the process understanding
of operations strategy of competitive
formulation priorities
Operations Opportunities to
detect deficiencies Strategic
Marketing
in operations Consensus
Interface alignment at the
interface with
marketing
Figure 1.
The theoretical
framework
3. Methodology Alignment of
Given that the objectives of this paper require in-depth data collection, the selected operations
organisation should grant access to some of the management staff. Furthermore, some
prerequisites were established for the selection of the company as follows: the existence of a strategy
clear distinction between operations and marketing functions, more than 1,000 employees,
allowing the researchers to meet and interview its managers, and frequent participation in
the process of strategy formation by the marketing and operations functions. 215
The selected company is located in the State of Sao Paulo, Brazil, and belongs to a
business group with worldwide operations in the chemical industry. This company is
responsible for 31 per cent of the total revenues of the group and employs 23 per cent of
its total workforce, approximately 1,400 employees. The product family considered is
the most representative of the group in economic terms. The annual production volume
qualifies the company as one of the largest producers of this product family worldwide.
The participating company met the conditions listed above and made available
three operations managers in the areas of logistics and manufacturing and three
marketing managers in the areas of trade, planning and sales.
Conceptual Background
Alignment of operations strategy, Operations-marketing interface, Strategic consensus
Protocol
Content analysis of
Procedure application Interviews Direct observations
documents
AD2 DO2
DO1
Categorisation
Chains of evidence Conclusions Figure 2.
Evidence The research design
IMDS (AD1 and AD2) and direct observations. All of these sources were based on the conceptual
113,2 background of this research. Initial interviews (IN1) were pre-tested by interviewing
participating managers. It became clear that some questions needed to be made clearer and
that additional questions needed to be included to cover further considerations. The
procedure was applied twice (PA1 and PA2), and each application required three meetings
with managers and allowed debates between them regarding interface processes. It was
216 therefore necessary to arrange six meetings over three months. Top managers and middle
managers each with representatives from the operations and marketing functions
attended all of the meetings. Shortly after the end of each meeting, we conducted
one-to-one interviews (IN2 and IN3) with the managers. We followed the guidelines
described by Voss et al. (2002) while deciding how to conduct the interviews over a period
of time, the search for convergence and clarification, and the recognition of bias. Therefore,
36 interviews were recorded, and 972 answers were transcribed for the data analysis.
Direct observations (DO1 and DO2) were made during all meetings and interviews.
Company directors attended the meetings at the end of each application. The set of
questions to be used in the interviews and guidelines for the content analysis of documents
and for direct observations covered managerial perspectives on the key concepts of the
interface processes and strategic alignment. For operations, these concepts include
capacity, technology, infrastructure, supply chains, control systems, development and
organisation. For marketing, these concepts include target markets, product portfolios,
pricing strategy, promotion and distribution channels.
Different perceptions among marketing and If manufacturing and marketing managers 1. Contextualizing facts: managers discuss
operations managers participate equally to the strategy development together the current adequacy of structural
process, the potential for incongruent strategic and infrastructural resources, considering the
goals between these functions can be reduced importance of disaggregated competitive
or eliminated (Swamidass et al., 2001) priorities to their customers and their
Results indicate that firms, which are able performance, compared with that of their
to evoke strong communication linkages, will competitors
benefit from enhanced strategic consensus
(Rapert et al., 2002)
Management misunderstanding of strategic Differences encountered in managers’ opinions 2. Exploring different perceptions of these facts:
operational objectives on order-winning criteria may be caused by this step structures all perceptions to extract
functional affiliation (Menda and Dilts, 1997) from their differences and similarities useful
data on the general analysis of the managers
Reduced monitoring of competitors and little Strategy as a perspective. How do we read 3. Generating hypotheses that guide
support for studies on high dispersion of the collective mind? (Mintzberg et al., 2003) investigations: managers elaborate on
managers’ perceptions can lead to strategic gap hypotheses and reflections to explain the
in the organization reasons for different or similar perceptions.
There is no consensus on what really adds Similarly to scientific procedures, this activity
value to the customers assists in targeting specific priorities or
resources that may be crucial for operational
alignment
The organization does not encourage an Operations function has to be gradually 4. Searching for reliable data: the research follows
integration of knowledge about the competitors exposed to its business environment in order the hypotheses, with the objective of
to better understand the market (Slack, 2004) approaching perceptions through data
reliability. The hypotheses trigger the process
of re-analysis of competitive factors and are the
basis for the birth of new insights
(continued)
The procedure’s
strategy
operations
construction
foundation, origin and
activities: theoretical
217
Table II.
Alignment of
218
113,2
IMDS
Table II.
Constraints that result poor performance Conceptual background to build up
of the interface processes the procedure Activities of the procedure
Inability to manage the strategy through the Frequent interaction/communication linkages 5. Changing perceptions: findings are shared
disaggregated priorities because of different lead to shared intraorganizational perceptions among participating managers, who discuss
managers’ perceptions (Rapert et al., 2002) the adequacy of structural and infrastructural
The perceptions of functional managers may resources to market needs and their
well be out of line with either the perceptions performance compared with that of the
of top managers or with the espoused strategy competition
(Bowman and Ambrosini, 1997)
The management of trade-offs between Trade-offs are perceived to exist, and as a 6. Discussing trade-offs: the uniformity of
marketing and operations is suffering from construct they are central to how managers perceptions on the adequacy of the current
under development approach the process of improvement (Silveira operational status with respect to the needs of
and Slack, 2001) the market provides a more detailed discussion
Mutual support of functional strategies of inter- and cross-functional trade-offs. In this
(Mintzberg et al., 2003) activity, alternatives are discussed to transpose
certain trade-offs and to seek a better balance
between them
Organizational barriers between functions Strategic consensus is the shared understanding 7. Negotiating strategic consensus: the purpose of
limit the ability of operations managers to of strategic priorities among managers this activity is to reach an explicit consensus
understand the business environment (Kellermanns et al., 2005) among operations and marketing managers on
The creation of a strategic alignment between a strategic actions to better align operations to
corporate business strategy and manufacturing market needs and to better use existing
strategy can facilitate the formulation of a operational resources
business-supportive manufacturing strategy
(Decoene and Bruggeman, 2006)
Managers tend to prioritise activities related High harmony between operations and marketing 8. Analysing strategic consensus among
to problems of their daily routine and of their signifies that a firm has high quality transaction managers: the framework ends with the
performance measurements processing between these functions, effective verification of consensus among the
communications flows, and high levels of participants. Texts written by the managers on
cooperation (Hausman, 2002) the strategic actions agreed upon are analysed
by them
According to the premise that collectively establishing hypotheses among managers Alignment of
can initiate an effective response to two questions – how to acquire specific knowledge operations
and how to read this collective mind (Mintzberg et al., 2003) – the procedure allows
managers to create hypotheses that guide investigations and answer their questions. strategy
Operations and marketing managers participate in the activities of the procedure.
Considering their customers, competitors and the strategic elements of interface
processes, operations and marketing managers develop activities in view of the 219
analysis of disaggregated competing priorities and structural and infrastructural
resources. One of the critical decisions for the start of this process to be successful is the
correct selection of the coordinator, who must be skilled in political and functional
interests.
The procedure is shown in Figure 3 and was based on the assumption that these
activities would be performed by operations and marketing managers and validated by
the directors. The procedure is associated with the analysis of the importance of
competitive priorities for clients, the analysis of performance with respect to
competitors and the adjustment of structural and infrastructural resources.
Analysing
strategic Generating C
consensus hypotheses O
C among STRATEGIC ELEMENTS that guide M
L managers OF INTERFACE investigations P
I PROCESSES RELATED E
E TO DISAGGREGATED T
N PRIORITIES AND I
T STRUCTURAL/ T
Negotiating O
S INFRASTRUCTURAL
strategic Searching R
consensus RESOURCES for reliable S
data
Discussing Changing
trade-offs perceptions
Figure 3.
OPERATIONS-MARKETING INTERFACE The procedure based
on strategic consensus
IMDS 3.3 Categorisation
113,2 According to Voss et al. (2002), effective case research requires coding of the
observations and data collected in the field. A database with all of the responses and all
of the observations and document analysis (indexed by function, theoretical concepts
mentioned and elements of the interface processes) enables the determination of the main
issues raised by the data sources. Accordingly, the following categories were identified
220 based on the data and the literature:
A – competitive priorities (Slack, 2004; Hill, 2005).
B – conceptual bridges (Zanon and Alves Filho, 2006).
C – activities of the procedure (Zanon and Alves Filho, 2006).
D – strategic alignment (Decoene and Bruggeman, 2006).
E – operations strategy formation (Brown et al., 2007).
F – operations strategy implementation (Rapert et al., 2002).
G – trade-offs (Silveira and Slack, 2001).
H – consensus (Kellermanns et al., 2005).
I – organisational issues (Mullins, 2006).
Each piece of evidence was found based on the frequency of answers, direct
observations and content analysis of documents as well as through the associations
between the data and theoretical references (Rytter et al., 2007; Hill and Brown, 2007;
Mullins, 2006; Rhee and Mehra, 2006; Johansen and Riis, 2005; Mintzberg et al., 2003;
Hausman et al., 2002; Swamidass et al., 2001; Boyer and Mcdermott, 1999; Parente,
1998; Nie and Young, 1997).
Shared topics between evidence and a category determine which evidence belongs
to which category. Figure 4 shows how the collected data were processed; this figure
CATEGORIES
A B C D E F G H I
1 A1 B1 C1 D1 E1 F1 G1 H1 I1
EVIDENCE
2 A2 C2 D2 E2 F2 I2
3 A3 D3 F3
Figure 4.
The relationship
CHAIN OF EVIDENCE
between the categories
A1, A3, C2, E2 and I1 support a conclusion
and their evidence
indicates the distribution of the evidence among the categories and enables the Alignment of
drawing of particular conclusions. Columns A-I represent the defined categories. Rows operations
1-3 indicate evidence by category (e.g. A1-A3 are the evidence from category A), and
cells A1, A3, C2, E2 and I1 inside the triangles indicate a chain of evidence that support strategy
a particular conclusion. Tables IV-VI in the next section are based on Figure 3 and
show the cells of each category. Table VII presents the chains of evidence.
221
4. Results and discussion
The quantification of the main issues raised by the data sources provides nine categories
that support the data analysis. Table III records the number of times that each issue was
mentioned. The first nine issues account for more than 75 per cent of all records.
We defined these issues as the categories of our research. The entries for the category
“trade-offs” represent 12.7 per cent of all records, and therefore, this category is the most
important identified by us. Trade-offs have proved to be key factors in conflicts
regarding the interfacial strategic elements between operations and marketing.
Marketing managers often criticised decisions about operations-specific trade-offs
(intra-functional trade-offs). For these managers, for example, the choice of technology
adopted is often based on the quest for productivity at the expense of flexibility.
During the meetings and interviews, and in the documents, we observed the
spontaneous use of conceptual bridges – the second identified category – that encouraged
Considered categories
Trade-offs – G 112 16 31 159 12.7%
Conceptual bridges – B 98 10 35 143 11.4%
Competitive priorities – A 104 8 23 135 10.8%
Strategic alignment – D 86 8 31 125 10.0%
Operations strategy
formation – E 72 8 21 101 8.1%
Operations strategy
implementation – F 54 6 27 87 6.9%
Organisational issues – I 32 14 27 73 5.8%
Consensus – H 34 10 21 65 5.2%
Activities of the procedure – C 28 8 19 55 4.4% 75.3%
Issues with a low frequency
Managers’ perceptions 27 6 15 48 3.8%
Interface processes 22 8 11 41 3.3%
Competitive context 22 4 9 35 2.8%
Operational performance 24 6 9 39 3.1%
Operational resources 22 0 7 29 2.3%
Inter-functional differences 20 0 9 29 2.3%
Product design 18 0 8 26 2.1%
Operations complexity 16 0 7 23 1.8%
Technology 10 0 7 17 1.4%
Product range 8 0 6 14 1.1% Table III.
Political power 4 0 5 9 0.7% 24.7% The main issues raised
Total 813 112 328 1,253 100% 100% by the data sources
IMDS the participants to engage in a more extensive and objective discussion regarding the
strategic alignment of operations. Conceptual bridges are the inter-relationships that are
113,2 established by the managers among the competitive dimensions of each function.
Whenever one of the managers mentions price, such as the marketing mix and cost,
as a competitive priority of the operations strategy in one of his or her arguments, s/he
establishes a conceptual bridge between the competing dimensions of marketing and
222 operations. These conceptual bridges are also key factors in the analysis of conflicts,
because observing these bridges during discourse allows the possibility of verifying
the ability of managers to relate the strategic elements of both functions and the level
of understanding of the conflicts between them.
To discuss the results achieved in this research, some of the relationships between
evidence and categories will be described, but this discussion will not be exhaustive.
Evidence A1 presented in Table IV suggests that managers had difficulties
disaggregating the main competitive priorities and defining the concepts to be used.
The frequency of this item was 19.3 per cent. We define the frequency as the number of
times that a given piece of evidence was identified in interviews, the content analysis of
documents and direct observations divided by the total number of times that all
evidence in the same category were identified.
Ideas to determine the key disaggregations were based on the strengths,
weaknesses, opportunities and threats (SWOT) matrix, the goals for the year, the
Categories
A B C
Freq. Freq. Freq.
Competitive priorities (%) Conceptual bridges (%) Activities (%)
Evidence
1 Difficulties of managers 24.3 Managers structure the 26.4 Activity in the context of 28.3
in disaggregating the arguments of their reality: different views
key competitive assumptions through of market needs
priorities and defining the relationships
the concept to be used between functional
trade-offs
2 Empirical beliefs 18.9 Use of conceptual 24.4 Managerial interest in 17.3
(without scientific proof) bridges during determining
about the importance of managers’ investigations to
competitive priorities for argumentation confirm or not confirm
customers the socialised
assumptions
3 Very different 16.3 Managers reflect on the 20.8 Development of 17.1
perceptions of incompatibilities hypotheses –
operations managers between technology, establishing relations
regarding priorities of capacity and product between resources, their
importance to customers portfolio performance and what is
expected by the market
4 Analysis of the 14.3 Understanding the 10.0
differences in competitive context of
Table IV. perceptions, previously the organisation
The relationship between unnoticed, of the
categories A-C and their understanding of market
evidence needs
current corporate strategy (a three-year strategic plan) and activity 1 (contextualising Alignment of
facts). The availability of products for orders, for example, was a disaggregation of operations
priority delivery, which managers had difficulty conceptualising. The managers were
uncertain whether the availability of products should be evaluated by considering the strategy
quantities of products on hand and actual demand or only the estimates provided in the
sales or production plans. Some misunderstandings occurred because of the difficulties
of conceptualising competitive dimensions; therefore, it was observed that these 223
difficulties also contribute to the conflicts between functions.
During the second interview, most managers mentioned having noticed the absence
of scientific proof of their convictions regarding the importance of competitive
priorities for customers (evidence A2 with frequency 18.9 per cent). These managers
stated that the first two activities in Table II were instrumental in reaching such
determination and that many managerial decisions are based solely on experience.
This result is important because it demonstrates that having reliable information is an
important element for achieving consensus. According to the transcript of an excerpt
from the interview of one of the operations managers:
[. . .] If I’m not convinced of the reliability of the information source, I distrust the importance
given to a certain priority and decide to follow my own instincts, because I know that it will
be difficult to reach a consensus.
Further evidence revealed by the entire group was that the operations managers have
different perceptions regarding the importance of customer priorities (evidence A3 with
frequency 16.3 per cent). According to the managers, the second activity, addressing
the exploration of perceptions in the current context, was crucial to provide evidence
A3. The main differences detected were discussed with the support coordinator, such
that serious consideration was given even to extreme perceptions.
Column B of Table IV presents evidence related to the category “conceptual bridges”.
The first evidence, B1 (frequency 26.4 per cent), demonstrates that managers structured
the argument of their hypotheses through the relationships between functional trade-offs.
Thus, from the managerial perspective, conjecture about the importance of customer
priorities and performance compared to competitors appeared to stimulate debate
regarding the inter-functional trade-offs of operations and marketing. All managers
perceived these debates to be of a reflective nature, especially when considering
incompatibilities between technology, capability and the product portfolio.
From the analysis of the category “conceptual bridges”, it was found that
managers, through their hypotheses, debates and consensus-building activities, could
share ideas to improve competitiveness and acquire broader knowledge about strategic
processes.
In addition to the different management views on market needs, differences in
perception regarding competitive priorities were also evident during the first and
second activities.
These differences appeared in the perceptions that managers have of the importance
of customer priorities and their performance compared to their competitors. Column D
of Table V presents the evidence related to strategic alignment.
The management group were surprised that such significant differences existed
among participants of the same functional group (evidence D1 – frequency 25.3 per cent).
One of the managers made the following comment during the interview:
IMDS
Categories
113,2 D E F
Freq. Operations strategy Freq. Operations strategy Freq.
Strategic alignment (%) formation (%) implementation (%)
Evidence
224 1 First and second 25.3 Possibility of evolution 30.4 Process of strategic 38.3
activities: different of interface strategic consensus attainment:
managerial perceptions processes convergence towards the
of competitive priorities implementation of
operational strategies
2 Fostering reflection on 17.2 Discussion of inter- 22.7 Analysis between 31.8
extreme perceptions and functional trade-offs functions on the
their consequences related to the formation operational performance
of operations strategy required by the market:
association with the
implementation’s flaws
3 Organisational 14.2 Learning on the 18.1
protections (stocks, formation of operations
mediation of product strategy and its
development staff) make alignment:
difficult the infrastructure,
understanding of technology and capacity
Table V. competitive issues of
The relationship between both functions
categories D-F and their 4 Encouraging 13.4
evidence information sharing
[. . .] We were very surprised during the initial activities because we did not expect that our
opinions would be so different. These distortions scare, because it indicates that we don’t
know our customers in the way we should know them and we are not analyzing our
competitors in the way we should.
These reflections converged on both the consequences of such differences for the
alignment between operations and marketing and the reasons for the differences; thus,
hypothesising was stimulated. For example, one can cite the importance to the customer of
the completion (one of the disaggregations of quality discussed) of the family of products.
Operational managers justify these discrepancies through the strong intermediation
of the area of product development (evidence D3 – frequency 14.2 per cent), which
discourages information sharing and questioning the importance of certain marketing
attributes. According to the operational managers, organisational protections
(in particular, the mediation of personal development products and stocks) make
understanding the competitive issues in both functional areas difficult. All operational
managers mentioned that information sharing, driven by the applied procedure, helps
reduce misinterpretation of the customer demands and thus favours alignment.
Because many discussions converged on operations strategy formation, we observe
three pieces of evidence (E1-E3 with frequencies 30.4, 22.7 and 18.1, respectively)
showing the possible influence of the applied procedure, as shown in column E.
These pieces of evidence address the possibility of the development of strategic
inter-functional processes. Considering that the main strategic focuses of the organisation
are internal operational issues, such as cost reduction and the elimination of production Alignment of
errors, it is expected that the applied procedure, by encouraging reflection on the needs of operations
markets in an environment of low functional integration, indicates the development of
strategic inter-functional processes to the managers. strategy
Because the procedure contains an activity exclusively aimed at the discussion of
trade-offs, it was expected that evidence would be presented on this subject. Trade-offs
are very important to operations strategy because management of trade-offs is 225
essential to produce a strategy tailored to the competitive conditions of the company.
Competitive priorities and decision areas should be considered in this light and ensure
a practical formulation that makes the applied strategy realistic and feasible.
Moreover, continuous decision making concerning these priorities will provide
sustainable alignment. Column G of Table VI presents the findings of the category
relating to this subject.
The debate on trade-offs, according to the interviewees, is an opportunity to reduce
the incompatibility between the functions through information sharing. The process of
selecting among disaggregated competing priorities implies deciding among a series
Categories
G H I
Freq. Freq. Freq.
Trade-offs (%) Consensus (%) Organisational Issues (%)
Evidence
1 Reflection on inter- 17.7 Conceptual bridges in 27.1 Difficulty defining the 27.5
functional trade-offs: the activity of processes of interface
arguments based on negotiating consensus between marketing and
shared information operations
2 Opportunity to reduce 15.3 Greater consistency of 17.2 Change in managerial 17.4
incompatibilities perceptions because of behaviour: increased
between the tasks: information sharing: socialisation of
meetings with managers facilitating the operations alignment
to encourage reflection negotiation of consensus problems
on the trade-offs
3 S&OP meetings: 14.2 Coordination: the ability 16.9 Presence of the directors: 15.0
correctional decisions to encourage reflection favours biases during
regarding operational on the dynamics of the trade-offs discussion
and market trade-offs market changes and
operational fitness, in
addition to reconciling
managerial views
4 Test of management 13.1 Integrated analysis of 9.2 Importance of the 12.7
assumptions: facilitating the results of new sponsorship of the
a better alignment sources of research to direction
between operations stimulate consensus
strategy and marketing among operations and
plan marketing managers
5 Learning: provides a 12.5
better balance between Table VI.
operational trade-offs The relationship between
and more alignment the categories G-I and
with market needs their evidence
IMDS of options. The number of possibilities available delays the process when experiences
113,2 and information are not exchanged. As one of the participating managers stated during
the interview:
[. . .] In my view, trade-offs are the key elements of the strategy formulation process. Many
conflicts occur because of them. The processes become sluggish when there is no interaction
to decide on trade-offs. However, they frequently avoid talking about it.
226
Application of the procedure showed that organisational issues also influence
the outcome of operations alignment, as shown in column I of Table VI. For example,
the managers stated that, during the meetings, they noticed a change in the behaviour
of the participants through a greater socialisation of the problems of operations
alignment (evidence I2, frequency 17.4 per cent). According to some accounts, the
initial meetings took place in an atmosphere of caution and study; however, during
the development of activities, the managers perceived that they were in an
environment in which it was safe to express their opinions. However, biases were
present in the considerations about trade-offs when the directors were present
(evidence I3, frequency 15.0 per cent). Moreover, all managers reported that the
sponsorship of the board is important to the alignment of operations strategy (evidence
I4, frequency 12.7 per cent).
With the purpose of identifying which factors can help managers to overcome
barriers to the alignment of operations strategy at the interface with marketing,
multiple sources of evidence, as defined by our methodology, allowed chains of
evidence to be established. The following relationship between the pieces of evidence
was used to form the chains.
The chain of evidence C3, D1, D2, E2, G3-G5 and I2 indicates that the reflections on
marketing and operational incompatibilities, the identification of differences of
perceptions among functional managers, the development of hypotheses, research
activities and greater socialisation of operational problems leads us to conclude that
the balance between intra-functional trade-offs is a factor that can support managers in
their attempt to overcome barriers to alignment of operations strategy. The learning
and behavioural changes can be regarded as a consequences of this process.
The collective interest in establishing new investigations and an integrated view of
the competitive environment influence the alignment of operations strategy at the
interface with marketing (evidence C1, C2, C4, F2, H3 and H4). These factors reduce
doubts regarding market needs and operational suitability.
Evidence B2, B3, C3, E3, F1, G2, and H3 demonstrate that the debates regarding
the trade-offs also promote important reflections among managers about the
understanding of customer needs and operational performance. These considerations
facilitate associations between the process of reaching consensus and questions about
issues related to technology, capacity and the product portfolio. As important factors
for promoting alignment, these reflections appear to encourage the use of conceptual
bridges and strategic learning from a more integrated view of interfacial processes.
According to evidence B1, B2, B3, D4, E1, G1, G2 and H1, the conceptual bridges,
reflections on conflicts between functional priorities, information sharing and
consensus building regarding processes with difficult functional delimitation
demonstrated that the understanding of inter-functional trade-offs can support the
operational alignment.
5. Conclusion Alignment of
This study aimed to determine the factors that can aid managers to overcome barriers operations
to alignment of operations strategy at the interface with marketing. The following
statement emphasises the relevance of this objective: strategy
[. . .] most organizations are as mortal as the people who create and run them. The obvious
explanation is that firms fail to reconcile market requirements and operations resources
because it is all too easy either to misinterpret customer requirements or fail to develop the 227
requisite operational capabilities (Slack and Lewis, 2008, p. 233).
The chains of evidence and their respective factors are shown in Table VII.
The first factor, the balancing between intra-functional trade-offs, is intrinsically
linked to the understanding of the needs of the market and, therefore, to a clear
definition of strategic objectives, which, according to Boyer and Mcdermott (1999), is a
critical factor for the development of strategic consensus. Improved balancing of cost
and quality levels within the specified limits of operations naturally leads to a more
appropriate treatment of market needs.
This factor demonstrates that even the internal decisions for specific operations
influence the alignment process. Therefore, levels of coherence and comprehensiveness
perceived by marketing managers can influence interface processes. Regarding the
operations, the balancing act suggests that a more flexible profile for operational
resources inhibits questions about the decisions and consequently avoids conflicts.
We conclude that the perceptions of managers are generally not supported by
scientific evidence but by experience acquired throughout their careers. Both access to
and sharing of knowledge through marketing and operations initiatives, such as market
analyses, surveys on the behavioural features of regional markets, the management of
distribution, programmes for cost reduction, lean production techniques, and so forth,
have proved to be of the utmost importance in changing perceptions. We observed that
marketing managers often mentioned operations initiatives and operations managers
often mentioned marketing initiatives when expressing their opinions. While this
knowledge sharing took place only gradually during the meetings, the use of conceptual
bridges became increasingly frequent.
We note that non-participative processes are often driven by performance targets
that can become a coercive influence on managers and can lead to a fragile and
temporary performance enhancement. In contrast, activities associated with joint
research on the competitive context appear to motivate management staff to better
understand threats and opportunities in business, thereby fostering the alignment
of functional strategies through strategic consensus. Joint research can aid the
understanding of which intersection of resources/needs are most critical and may
C3, D1, D2, E2, G3, G4, G5, I2 The balance between intra-functional trade-offs
C1, C2, C4, F2, H3, H4 Joint research on the competitive context Table VII.
B2, B3, C3, E3, F1, G2, H3 Reflections on the understanding of customer The chains of
needs and operational performance evidence and their
B1, B2, B3, D4, E1, G1, G2, H1 Understanding of inter-functional trade-offs respective factors
IMDS reduce investment bias. Relevant theory can be generated from the understanding
113,2 gained through in-depth studies of this factor.
Reflections on the understanding of customer needs and operational performance
can lead to effective strategies through an interactive learning process and an
improved organisational climate. Strategic interface processes between operations and
marketing must value knowledge sharing and consensus more than they value
228 technical activities that are inherent in the functions. This promotes the supremacy of
corporate interests. This factor encourages detailed investigation that leads
management staff to discuss improvements in the corporation’s performance. The
identification of this important factor suggests the opportunity to expand the theory,
considering that it favours the double-loop learning of Slack and Lewis (2008), given its
ability to stimulate reflection about competing paradigms among functions.
A reflection process can assess the level of correspondence of operations strategy
and reduce resistance against established modus operandi.
Their understanding of inter-functional trade-offs allowed management staff to exhibit
an improved cognitive structure regarding functional strategies and their interfaces. We
conclude that this factor reduces the negative impact of organisational structures and
political influence on the alignment process. In other words, the understanding of
inter-functional trade-offs enables conflict to be reduced through a sharing of opinions and
values that determines a more appropriate and participatory resource distribution.
We can state that the innovative contribution of this research will provide factors
that reduce the influence of specific structural issues of operations strategy (operations’
resources profile, investment bias, history and organisational structures/political
forces) and cooperate with the basic aspects of its formulation relative to its alignment
(comprehensive, coherence, correspondence and criticality).
The factors point to reductions in conflicts and interface difficulties and, consequently,
can improve organisational performance because an inability to integrate these functions
usually results in reduced organisational performance (Gonzalez et al., 2004). These
authors provide a good platform for further study in an area that can add value to the
strategic direction and eventual implementation of the chosen direction.
Given the unceasing search of companies for decision-making processes that
maximise their results, we note that these factors provide management staff with
valuable information that can be used to improve the alignment of their operations. In
other words, managers are better placed to make decisions because of their broader
knowledge about interface processes.
Recent research has shown the need for events that foster dialogue and action, and
the importance of bridging strategy language and reality (Rytter et al., 2007).
This finding is directly applicable to the domains of market strategy and operating
strategy (Hill and Brown, 2007). In this context, cross-functional relationships can be
identified, and collaboration and networking between groups can be encouraged
( Johansen and Riis, 2005). The operations-marketing strategic interface, therefore, has
considerable potential to improve the competitive performance of organisations. We
suggest that focusing on this interface can aid managers to explore relevant
opportunities, thus expanding the practical implications of strategic theory.
Possible benefits to marketing may include the knowledge of untapped operational
capabilities and potential time reductions in introducing new products (time to market).
There are many conflicts in the operations-marketing interface due to the existence of Alignment of
differing interests (Shapiro, 1977; Mukhopadhyay and Gupta, 1998; Hausman et al., 2002). operations
Consequently, the professionals involved in these conflicts are subjected to severe stress.
The factors found in this study aid in overcoming barriers in the alignment of operations strategy
and thus facilitate the interaction of the interface processes. This implies improved
relationships between the professionals involved in these processes. Therefore, the
results found in this research can improve the quality of the lives of not only managers 229
but also everyone involved with the tactical and operational processes of these functions.
Organisations that stimulate the factors identified in this research can achieve
relevant economic and commercial gains. The economic impacts can be generated from
operating activities that are better aligned over time with market needs. For instance,
the ability to quickly adjust the operational capabilities can avoid the cost of obsolete
inventory. Examples of business impacts include the fast introduction of new products,
short delivery time and greater mix and volume flexibility.
The contributions of this research can be discussed in the classroom for courses on
industrial management, production engineering and marketing. They can also
encourage teaching and learning regarding the operations-marketing interface and the
alignment of operations strategy.
The study of a single organisation should be considered a limitation of this work.
However, our research design ensures a great depth and the opportunity to observe the
interactions between managers at the moment they occur.
Future research using relevant themes identified in this study may be able to find
more evidence concerning the applicability of the results through new case studies.
Additionally, the substantiation of practical results for the organisations in the short
and medium term is very important for final validation. The ultimate goal is to
promote approaches that are aligned with structural and infrastructural resources,
operational control systems that ensure that customers’ needs are met, pricing
strategies that are aligned with the products’ attributes, and a choice of technology that
must be compatible with both current and future market requirements. We also note
the decreased time-to-market and improvements in long-term demand forecasting.
Quantitative approaches and modelling for future exploration may be interesting
alternatives for multi-case verification of the operational resources profile, considering
that research on this barrier permits, for example, the analysis of a number of assets
dedicated to specific tasks.
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