Risk calculations in the manufacturing technology selection process

Abstract

PurposeThe purpose of this paper is to present result obtained from a developed technology selection framework and provide a detailed insight into the risk calculations and their implications in manufacturing technology selection process.Design/methodology/approachThe results illustrated in the paper are the outcome of an action research study that was conducted in an aerospace company.FindingsThe paper highlights the role of risk calculations in manufacturing technology selection process by elaborating the contribution of risk associated with manufacturing technology alternatives in the shape of opportunities and threats in different decision‐making environments.Practical implicationsThe research quantifies the risk associated with different available manufacturing technology alternatives. This quantification of risk crystallises the process of technology selection decision making and supports an industrial manager in achieving objective and comprehensive decisions regarding selection of a manufacturing technology.Originality/valueThe paper explains the process of risk calculation in manufacturing technology selection by dividing the decision‐making environment into manufacturing and supply chain environment. The evaluation of a manufacturing technology considering supply chain opportunities and threats provides a broader perspective to the technology evaluation process. The inclusion of supply chain dimension in technology selection process facilitates an organisation to select a manufacturing technology not only according to its own requirements, but also according to the interest of its constituent supply chain.