High value manufacturing: Capability, appropriation, and governance

Manufacturing competitiveness is on many policy agendas, born out of a concern for firms in high-cost economies finding themselves outcompeted by low-cost rivals. Government policy makers and manufacturing firm strategists have put their faith in what we label as high value manufacturing (HVM). We see HVM as an incipient phenomenon currently in a situation of prescience, as something that is still “in-the-making,” with manufacturing firms trying to find ways to be able to step away from having to compete on price. This paper consults relevant strategy theories with the purpose to pinpoint the issues and problems that need to be accommodated for bringing HVM into being and for creating the effects that are anticipated. We found that HVM must be seen as a distributed activity, thus realizing complex functionality for a system-of-use, while being subjected to path constitution. For HVM to function, the firms involved need to find solutions to the capability problem, the appropriation problem, and the governance problem. We suggest that further research needs to involve itself in problem-solving activity to assist in bringing HVM about while simultaneously further developing strategy theory geared toward firms that are involved in a distributed activity like HVM.