The adoption of advanced manufacturing technologies : human resources management implication - New Zealand evidence

Abstract

An increasing number of organisations around the world are seeking to improve their long-term manufacturing competitiveness through the adoption of advanced manufacturing technologies (AMT). These technologies have the potential to improve product quality, increase process flexibility, and reduce manufacturing cycle time. However, there is one major concern: the implication for human resources management strategies adopted by firms to complement technological innovations.

Technological innovations have been suggested to encourage the displacement of low skilled workers in favour of highly skilled ones. The reason for such disposition (reduction of low skilled workers) is based on the assumption that highly skilled and educated employees can adapt more easily to new technological innovations. Furthermore, employee empowerment and development are also enacted to promote these changes. Other recent studies also suggest a need for the examination of the implication of the two categories (linked and integrated) of AMT for human resources (HR) strategies.

In all, the purpose of this study is to examine the HR management implications of AMT adoption, using a comprehensive firm-level survey of technological adopters in New Zealand. Data collected through questionnaire administration enabled us to examine the relationship between AMT, its two categories (linked and integrated) and employee empowerment and composition.

Test of hypotheses formulated for this research indicated that technological adoption is associated with overall reduction in organisational size (downsizing) and the extent of employee empowerment. More statistical analysis revealed that human resources strategies that accompany technological adoptions vary by category of technology adoption. We found that linked AMT is more related to employee empowerment compared to integrated AMT. On the other hand, integrated AMT is more related to employee recomposition compared to linked AMT. In other words, organisational size reduction and compositional shift in favour of skilled and educated workers is greater in integrated AMT compared to linked AMT adoption.

Considering the impact of automation and computerization on the world economy, this study will help organisations to reduce or eliminate the inconsistencies between technological adoptions and their final objectives, with regards to HR management strategies. In addition, apart from contributing to the scanty knowledge in the area of AMT adoption, the current study will shed more light on New Zealand's level of awareness of new technologies.