Title: An empirical study of the effects of uncertainty on SME manufacturers

Authors: S.C.L. Koh, Angappa Gunasekaran, Sameh M. Saad

Addresses: Management School, University of Sheffield, 9, Mappin Street, Sheffield, S1 4DT, UK. ' Management Department, University of Massachusetts, 285 Old Westport Road, North Dartmouth, MA 02747–2300, USA. ' School of Engineering, Sheffield Hallam University, City Campus, Sheffield, S1 1WB, UK

Abstract: This research examines how and to what extent uncertainty affects SME manufacturers who plan and schedule their production using MRP, MRPII or ERP systems. The results show consistent tardy delivery performance, reinforcing that there is a shortage of guidance and knowledge on how to tackle uncertainty in these SMEs. We propose a business model for SME manufacturers to enable diagnosis of causes of uncertainty so that they can be dealt with effectively and efficiently. The business model is applied using a questionnaire survey in 51 SMEs in the UK and the empirical results provide the SME manufacturers with a reference on which causes of uncertainty are more likely to result in tardy delivery. Using a real case study, simulation modelling and experimental study, the results show that knowing the significant causes of uncertainty does add value to the decision-making of the SME manufacturers in tackling uncertainty.

Keywords: uncertainty; SMEs; MRP; MRPII; ERP; enterprise resource planning; UK manufacturing; production planning; scheduling; simulation; decision making; material requirements planning; manufacturing resource planning.

DOI: 10.1504/IJSOM.2005.007500

International Journal of Services and Operations Management, 2005 Vol.1 No.4, pp.395 - 425

Published online: 27 Jul 2005 *

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