Participative management: An empirical study of the semiconductor manufacturing industry

In order to stay competitive, semiconductor fabrication plants (fabs) must increase throughput and lower casts. At the same time processes are becoming more complex with shorter life cycles. In this environment, some fabs are turning to their workforce for the added capacity, flexibility, and speed, This paper examines the effect of participative management techniques on manufacturing performance. Analyzing an international sample of 15 fabrication plants, we show that participative management has a statistically significant and positive correlation with manufacturing quality and a positive, but not statistically significant, correlation with quantity. The analysis also shows that the fabs in our sample tend to drive the individual components of participative management-power, information, rewards, and knowledge-to the lowest level of the organization in a congruent fashion. This suggests that those fabs that utilize participative techniques do so efficiently.