Title: Incorporating competitive advantage into the process technology investment decision

Authors: Alison U. Smart, Peter Barrar, Andrew M. McCosh, Ashley D. Lloyd

Addresses: Manchester Business School, Booth Street West, Manchester, M15 6PB, UK. Manchester Business School, Booth Street West, Manchester, M15 6PB, UK. The University of Edinburgh Management School, William Robertson Building, 50 George Square, Edinburgh, EH8 9JY, UK. The University of Edinburgh Management School, William Robertson Building, 50 George Square, Edinburgh, EH8 9JY, UK

Abstract: Evidence suggests that few organisations specifically factor competitive advantage into process technology investment decisions, despite evidence that companies who invest for market reasons tend to be more successful. This article outlines a five-step method that companies can use to ensure that competitive advantage is explicitly included in the investment decision. The steps outlined assume that a company wishes to invest in process technology to achieve an advantage. The five steps require an estimation of the competitive position, identification of a potential competitive advantage, discrimination between projects based on competitive advantage factors, financial appraisal and a final check to ensure that the proposed investment fits the strategy.

Keywords: process technology; technology investment; competitive advantage; strategy; financial appraisal.

DOI: 10.1504/IJMTM.2002.001458

International Journal of Manufacturing Technology and Management, 2002 Vol.4 No.5, pp.401-419

Published online: 03 Jul 2003 *

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