Leveraging global operations innovation to create sustainable competitive advantage

Abstract

High fixed costs and the emergence of globalization have forced traditional domestic automotive mass producers to the brink of bankruptcy. This thesis focuses on the global growth strategy of a Tier 1 automotive supplier and examines causal relationships between that strategy and the system stakeholders who execute and support it. The literature review examines current research to illustrate the benefit of approaching globalization with a process-driven, systems-based mindset. Current literature offers insight into improved financial measures that traditional mass producing firms can employ to streamline decision making and shift the mindset of leaders to engage employees, suppliers, and customers around a long-term systems based operating strategy. The thesis is based upon three core experiences the author had at American Axle to illustrate the importance of systems-based operations innovation. The literature review in conjunction with the internship experience is used to illustrate opportunities for American Axle to improve its operating strategy. The paper highlights traditional approaches currently used inside the company and offers solutions to change employee behavior throughout American Axle's global manufacturing system. The thesis examines behaviors, metrics, and results often seen in an absorption cost environment where there are weak operational controls and non-standard corporate scorecards. Using current research and professional industry experience, I will argue robust operational controls and metrics, aligned with an overarching systems approach that considers the long term implications of today's decisions, are essential components to the viable, long term success of any global enterprise.