Investigating German Small and Medium-sized Manufacturing Companies and their Journey to the SmartFactory
: Possible Instruments for Maturity Assessment and Long-term Development

  • Volker Brunnenmiller

Student thesis: Doctoral Thesis


Companies in the manufacturing industry have been in a constant need for improving production processes to sustain market positions and competitive advantages, and this need has exacerbated through growing international competition, increasing market volatility, demand for highly individualised products, and shortened product life cycles. While these enterprises have long been able to draw on traditional optimisation tools, such as strategic quality management systems, to keep their processes up to par, the recent development of Industry 4.0 has changed their situation fundamentally and has partly blunted once effective tools. One aspect of Industry 4.0 in the manufacturing sector, the SmartFactory, can be implemented by large corporations or new market entrants with considerable financial means in a clean-slate, revolutionary approach. In contrast, a small and medium-sized company (SME) with its limited financial, workforce, and knowledge resources has to take a slower, evolutionary path toward introducing these technologies and reaping their benefits to defend their competitiveness. The disadvantages for SMEs in the wake of the burgeoning Fourth Industrial Revolution pose a particular problem to the German economy, in which highly specialised, internationally successful SMEs play an important role. These companies need additional optimisation instruments, incorporating as well as supplementing the existing ones, to organise their path toward becoming SmartFactory entities. Yet, the existing tools for SmartFactory implementation have been developed for larger-scale companies and are unsuitable for SMEs. In particular, there is only limited research on how SmartFactory maturity can be measured for German SMEs and how the transformational journey towards a SmartFactory can be advanced through sustainable process-optimisation steps yielding immediate benefits. These short-term successes are particularly important in the resource-poor SMEs.
To contribute to filling this gap in practice and research, this thesis develops three instruments, which are specifically geared toward German SMEs by taking their particular characteristics into account. These instruments are an SME-specific SmartFactory maturity model (assessing the most important dimensions: strategy, process, structure, people, and technology); a framework that supports the introduction of new and highly advanced SmartFactory tools and concepts; and a SmartFactory Process Optimisation Loop (SPOL), which, in an iterative approach, structures the SmartFactory transformation process of SMEs. All three instruments are based on a SmartFactory definition appropriate for German SMEs and on a guiding precept that is based on Chandler’s (1962) principle and expands it as follows: structure follows process follows strategy enabled by people and technology.
To this end, the thesis employed a qualitative-empirical approach. Preliminary versions of the maturity model and the framework were developed on a theoretical basis and were then revised using qualitative-empirical data from semi-structured expert interviews. A first set of interviews with SmartFactory experts and managers of German SMEs was used to identify special SmartFactory characteristics, challenges, future market demands, and needs for assistance. Afterwards, a second set of interviews with experts for the dimensions of the maturity model was conducted. The goal was to evaluate each dimension and its associated objects to ensure the completeness of the model, a proper delimitation of the maturity stages, a conclusive description of the characteristics of each stage, and the applicability of the entire model.
The finalised maturity model, the technological framework, and the SPOL, in which they are embedded, provide a step-by-step agile loop approach that generates current-state descriptions, supports strategic decisions, outlines optimisation roadmaps, and ultimately accompanies the SME on its path through digital transformation.
Date of Award10 Jun 2022
Original languageEnglish
Awarding Institution
  • University of Portsmouth
SupervisorAlaa Karam Abdelaal Garad (Supervisor), Hoefer Stephan (Supervisor) & Philip Brabazon (Supervisor)

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