PAPER WITHIN Production Systems
AUTHOR: Marc Daniel Betz, Ahmad Taffash
JÖNKÖPING June 2021
Managing successful implementation
of flexible automation in SMEs
This exam work has been carried out at the School of Engineering in Jönköping in the subject area Production system with a specialisation in production development and management. The final thesis is a part of the Master of Science program. The scientists take full responsibility for opinions, conclusions and findings presented.
Examiner: Gary Linnéusson
Supervisor: Daniel Hussmo
Scope: 30 credits (second cycle)
Abstract
Abstract
Today the global market is changing to increased competition, short product life cycles and mass customisation. Therefore, the pressure on manufacturing companies to become more flexible in their production has increased. As a response to this increased pressure, many companies have implemented automation solutions to achieve the required flexibility and stay competitive. Small and medium-sized enterprises (SMEs) are particularly under pressure, because they are usually subcontractors to large companies which trigger and promote high-mix and low-volume production. The literature shows that there are couple of reasons, for example poor management skills, impacting SMEs' behaviour and the way they run businesses. Moreover, the academia uncovers the misassumption that the conceptual frameworks, organisational theories, and processes developed through researching large companies are directly applicable and relevant to SMEs. The truth is SMEs run the business and adopt models and theories differently from larger counterparts. Therefore, the purpose of this study is to increase knowledge about managing successful implementation of flexible automation projects in companies with a high mix, low volume production. The methodological approach of this work was theoretical and empirical driven. The theory part includes a literature review, and the empirical section includes a single case study and experts involvement. Thereby five key words for flexible automation could be identified which built the basis for the research. The outcome of the study is 21 general recommendations regarding implementing flexible automations at SMEs with high mix, low volume production. These recommendations have been developed to help SMEs in their journey with automation as they can be used as a road map to cover the implementation process, before, during and after.
Keywords: Flexible Automation, Employee Involvement, Change Management, SMEs, Implementation.
Contents
1
Introduction ... 4
1.1 BACKGROUND ... 4
1.2 PROBLEM DESCRIPTION ... 5
1.3 PURPOSE AND RESEARCH QUESTIONS ... 6
1.4 DELIMITATIONS ... 6
1.5 OUTLINE ... 6
2
Method and implementation ... 8
2.1 RESEARCH DESIGN ... 8
2.2 LITERATURE REVIEW ... 9
2.3 EMPIRICAL PART ... 13
2.3.1 Case Study ... 13
2.3.2 Expert involvement ... 14
2.4 METHODS FOR THE DATA ANALYSIS ... 15
2.5 RESEARCH QUALITY ... 15
3
Theoretical framework ... 18
3.1 CHANGE MANAGEMENT ... 18 3.2 AUTOMATION ... 27 3.3 EMPLOYEE INVOLVEMENT ... 314
Empirical findings ... 34
4.1 CASE DESCRIPTION ... 344.2 INTERVIEWS CASE COMPANY ... 35
4.3 EXPERT INTERVIEWS ... 41
5
Analysis ... 45
5.1 BEFORE THE IMPLEMENTATION ... 45
5.3 AFTER THE IMPLEMENTATION ... 52
6
Discussion ... 55
6.1 DISCUSSION OF THE FINDINGS ... 55
6.2 DISCUSSION OF THE METHOD ... 60
7
Conclusion and recommendations ... 62
7.1 RECOMMENDATIONS ... 62
7.2 CONCLUSION ... 63
8
References ... 64
9
Appendices ... 69
9.1 APPENDIX 1INTERVIEW QUESTIONS,EXPERTS ... 69
Figure list Figure 1 Research process. 9 Figure 2 Relevance tree for the literature study. 10 Figure 3 Lewin’s model of change adapted from Lewin (1947). 20 Figure 4 Transition phases (Hayes, 2014, p.261). 25 Figure 5 Attributes for implementing a CoBot solution adapted from Djuric et al. (2016, p. 459). 31 Figure 6 Case company organigram. 34 Table list Table 1 Search terms regarding Employee. 11 Table 2 Search terms regarding Automation. 12 Table 4 Ethical and moral aspects in research adapted from Bell & Bryman (2007). 17 Table 5 Model for leading change adapted from Kotter (1995, p.61). 21 Table 6 Recommendations relating to before, during and after the implementation of flexible automation. 62 Abbreviations CoBot ... Collaborative robot LoHi ... Low volume high mix MS ... Microsoft SMEs ... Small and medium-sized entersprise
Introduction
1
Introduction
This chapter describes the background of the study and the problem area this study is built upon. Additionally, the purpose of the study and the research questions are presented. The delimitations and the scope of the study are also described. Finally, the disposition of the study is delineated.
1.1 Background
Increased global competition is tweaking the environment facing most companies today by pushing these companies to boost performance through adopting and innovating processes and product improvements (Baily et al., 2005). This requires implementing cutting-edge automation technology in manufacturing small and medium-sized enterprises (SMEs) as Automation is a vital factor in attaining SMEs' competitiveness (European union, 2019). SMEs play a significant role in the improved Swedish non-financial business economy due to the generated value added- up to 61% and generated employment EU: 56.4% and 66.6%, respectively (European Union, 2020).
SMEs are usually subcontractors to larger companies which trigger and promote high-variation and low-volume production (European Commission & Programme, 2009). Consequently, high-variation and low-volume production offer a market advantage with improved responsiveness, tailoring to customer demand, low inventory requirements for finished goods, and higher flexibility (Berndtsson & Christensson, 2019). Bossen & Ingemansson (2016) stated that Automation would be of great significance to the Swedish manufacturing industry for the contribution it has in increasing flexibility. Moreover, flexibility resulting from adapting automation plays a significant role in staying competitive by offering higher quality and reducing costs (Bossen & Ingemansson, 2016). According to the change management literature, automating a particular area is considered an operational change that targets how the ongoing operations in the business are done and have its most significant effect at the organisation’s lower level (Lorenzi & Riley, 2000). Yet, Ates & Bititci (2011) defined a couple of characteristics impacting SMEs' behaviour when managing change, including but not limited to the firefighting approach, limited resources, poor management skills, etc. When it comes to change management, most research is based on large companies with a narrow focus on SMEs (Ates & Bititci, 2011). Tonge (2001) reveals an implicit assumption that conceptual frameworks, organisational theories, and processes developed through researching large companies are directly applicable and relevant to SMEs. However, how SMEs run the business and how they adopt models and theories are different from their larger counterparts (Sarkar et al., 2001). Hence, it is significant to consider the unique characteristics and pattern of behaviour in managing change at SMEs when studying change management capability in SMEs’ context. Furthermore, García-Morales et al. (2007) stress the importance of different
Introduction
management for SMEs from large organisations to be successful. Contemplating all the given facts reveals a need to change in the management at SMEs to benefit from implementing automation efficiently and to ensure employees involvement.
1.2 Problem description
The Swedish manufacturing industry comprises small and medium-sized enterprises with low volume series with high variety (Löfving et al., 2018). Many of these companies count on workforce to achieve higher flexibility. However, in a country like Sweden, which is considered a high-wage country compared to other countries, relying on workforce is not considered cost-efficient. Thus, there is a risk that Sweden loses its position on the global market to its competitors in low-wage countries (Stankiewicz, 2015). To avoid that, some SMEs in Sweden implemented flexible industrial robots to increase flexibility, social sustainability, and competitiveness (Hammar & Norström, 2020). Nonetheless, for SMEs with low volume and high mix, the degree of Automation is low. This is because industrial fixed automation is traditionally utilised for high volume and low variation production (Camarinha-matos et al., 2016; Sjøbakk et al., 2014).
The technological advancement around the globe brought flexible robots that can be moved, are easy to be programmed, and safe to be used without guards. The ability for these robots to be moved enables beneficial utilisation for automation for different production settings, thus providing flexible automation solutions. A research project called Low volume high mix production in Sweden by flexible automation and mobile robots (LoHiSwedProd) has been initiated to address the implementation of flexible robots, financed by the strategic research program Produktion2030. Two previous master theses were conducted as part of the LoHi project. The first master thesis aimed to investigate the changes in the working environment after implementing flexible automation solutions and evaluating flexible robots' performance at few case companies (Berndtsson & Christensson, 2019). The second master thesis aimed to identify problems within the use of flexible robots in SMEs (Hammar & Norström, 2020). Hammar & Norström (2020) categorised stumbling blocks that hinder SMEs from implementing flexible Automation into different categories. An example of these stumbling blocks is the attitudes and mindsets of the managers and employees, which need to be further investigated (Hammar & Norström, 2020). Ingaldi & Ulewicz (2020) reveal that both employees and management should be convinced that change is good. Moreover, the whole organisation must be on board to guarantee the success of the change implementation. The combination of having an unrealistic expectation of the changes' effect and the limitation of resources leads to a lack of top management commitment (Johansen & Öhrwall Rönnbäck, 2007). In a connected context, the decision to invest in automation is challenging for both management and employees. This decision will create a change in the working context/tasks for both management and employees on the shop floor. To facilitate the transition, management support is
Introduction
considered to be vital (Hayes, 2014). Scherrer-Rathje et al. (2009) believe that management support is an essential condition for success as it can it lengthen the decision-making process, undermine employee commitment, and contribute to communication breakdowns.
1.3 Purpose and research questions
Given the problem stated above, the purpose of this research is the following: Increase knowledge about managing successful implementation of flexible automation projects in companies with a high mix, low volume production. This knowledge is intended to support SMEs during the journey with automation by being more efficient when managing implementation of flexible automation solutions. Hence, the aim is to develop recommendations on how to manage implementation of flexible automation solutions successfully.
To address this, the research intends to answer three research questions:
1. What aspects are important to consider before implementing flexible automation?
2. What aspects are important to consider during implementation of flexible automation?
3. What aspects are important to consider after the implementation of flexible automation?
1.4 Delimitations
The field of automation solutions is vast. There are a countable number of flexible automations that have been used in SMEs to attain the level of desired flexibility in these companies. This research is dedicated to investigating SMEs with low volume high mix production, excluding SMEs with mass production. Additionally, the study will not investigate fixed Automation.
1.5 Outline
The thesis is divided into seven chapters. The first chapter introduces the research background and why it is essential to study it, the research questions, aim, and purpose are also defined. Afterwards, the second chapter illustrates in detail the methodology behind the research. The research design, the theoretical, empirical part and the data analysis are presented. The third chapter forms one of the three pillars of the study and covered the theoretical aspects which are divided into management, employee involvement, and automation. Chapter four presents the summaries from the case company and expert interviews which are the second and third pillar of the study. The fifth chapter covers the literature study results and the interviews together. They are analysed relating to three steps, before, during, and after the implementation. The
Introduction
research questions are answered in the penultimate chapter, and the most important aspects are summarised. The final chapter concludes the study results and presents the recommendations for managing the implementation of flexible automation successfully.
Method and implementation
2
Method and implementation
This chapter deals with the research method and the used strategies for the study, whereas the structure of the methodology chapter is oriented on the research ‘onion’ from Saunders et al., (2016). Moreover, the chapter motivates why the presented strategies are used. Besides, the research process is explained, including the case company’s participation as a resource for the data collection.
2.1 Research Design
The research design is divided into two parts. The first one is the theoretical part, including the literature review, which builds the foundation of the study. The second part is empirical, which includes the case study and the expert interviews. It gives the study a practical connection to ensure that the developed recommendation has relevance for practice and support the results of the literature study. Besides, the view of the three different angles improves the quality of the recommendations (Figure 1). The focus on theory implies already that the thesis follows a deductive approach, which means the work is theory-driven, wherefore an in-depth theory analysis was done (Saunders et al., 2016). The deductive approach was chosen because the recommendations developed needed a link to previous research to ensure relevance and a broad view. Therefore, an extensive literature review has been chosen. This ensured that the view of different authors and different aspects were involved which may have not been identified as important before (Saunders et al., 2016). According to Easterby-Smith et al. (2018), the literature study is an essential part of a research project to evaluate and clarify what is already known about the topic and to outline gaps in the knowledge. Furthermore, it shows what the research project is adding to the field, and it justifies why the research is conducted (Easterby-Smith et al., 2018). Therefore, the literature study was carried out systematically to cover the known and unknown in the fields (Saunders et al., 2016). Based on the literature study, the questions for the expert interviews and case interviews have been developed (appendix 9.1 and 9.2).
The data collecting method was qualitative, including single-case analysis, interviews, and a literature study. The single case study was described by Williamson (2002) as suitable for investigating a limited group or organisation in a real-life context. In this research, the case study formed the frame for the empirical part wherein semi-structured interviews were conducted (Saunders et al., 2016). The empirical part was extended with two semi-structured expert interviews. The view of the experts brought real-life experiences in the research project without any company connection. This variety of people and functions increased the reliability and validity of the thesis work, according to Williamson (2002).
Method and implementation
Research process structure
The transparency of a research process is crucial to allow others to judge the work themselves and to give the possibility to replicate the presented work (Saunders et al., 2016). Therefore, the research process structure has been explained as following. The whole research process can be divided into a theoretical and an empirical part. Where the theoretical part is defined by the background knowledge of the researchers and the literature study builds the theory basis for the development of the empirical part. Moreover, the empirical part supports the knowledge out of the literature study and adds a real-life connection to it with the expert interviews and the case study. To ease the understanding of the research process, figure 1 presents the overview of the whole process.
Figure 1 Research process.
On the left side of the figure is a timeline that shows what happened over time. First, the process was started with brainstorming to find relevant topics for the research project, which was done with the knowledge of the researchers in support of the supervisor. The research questions were developed, and the relevant fields for the literature study found. After the literature study, the expert’s interviews were done, and the questions for the interviews were developed out of the findings of the literature study. The case study started parallel to the expert involvement. For the case study, one company was chosen wherefore interviews were conducted. Lastly, the findings of the literature study, the expert interviews, and the case study were synthesised in the analysis part to answer in the discussion the research questions and lastly to form the conclusion and recommendations for successfully managing the implementation of flexible automations in SMEs.
2.2 Literature review
The search process was conducted in three main areas, Automation, Management, and Employee. To give the study a structure, the relevance tree method from Saunders et
Method and implementation
al., (2016) was applied. Therefore, a brainstorming session was carried out to find the relevant fields and topics for the literature study. The relevance tree is a similar constructed to an organisation chart whereby the research questions are reflected in the headings and subheadings (Saunders et al., 2016). For the presented research the relevance tree was adjusted and combined with the results from the brainstorming session. During the brainstorming, three keywords have been identified, which formed the basis for the research process. Therefore, the starting point for the relevance tree and the literature study were three keywords, management, employee, and automations for SMEs. Figure 2 shows the used relevance tree whereby each key topic was extended with connecting words from the second or third level, which was used alone or in combination with the keywords. During the research process, the search terms have been extended with new keywords which could be found during the search process. Therefore, the presented relevance tree (figure 2) presents the starting point of the research process.
Figure 2 Relevance tree for the literature study.
The search was conducted in three databases to ensure that relevant literature was not overseen. The databases used were ProQuest, Web of Science, and the University Database Primo. The search process in all databases followed the same processes. The search was limited to sources from 2000 to 2021, and the search criteria have been “title” for Primo and ProQuest and for Web of Science “topic” because the criteria “title” was not available. The date limitation was not used for paper out of the management field since there are many papers which are still relevant for this field even though they were written before 2000 for instance, Kotter (1995). The search process was divided into three steps, in the first step, each title of the search results was checked and if a title sounded relevant or promising the abstract of the document was read. In the second step, the findings and conclusion of each document with a relevant title and abstract was read. The last step was the reading of the whole text, and if it was still relevant, it was used for the theoretical background. The whole selection process was related to the selection process by Booth et al. (2016). Additionally, to the structured literature research, the snowballing approach was also applied to cover relevant literature which may have not been found. Snowballing means that the bibliography of the chosen paper was checked for further relevant papers (Saunders et al., 2016).
Method and implementation
Literature Study on Employee
The literature study on employee was carried out to build the basis for answering all three research questions since the employee perspective is central to all three questions. The goal was to identify relevant topics for the questionnaire and to examine the different aspects of the employee in a company. The search terms used in each database are listed in table 1.
Table 1 Search terms regarding Employee. Operator 4.0 Human factor in
Automation Workforce and Automation Employee involvement in Automation Employee involvement SME Employee involvement and automation design Job autonomy automation
project
Job autonomy automation development Employee SME Employee involvement SME Employee automation SME
The search followed the steps and settings as described earlier. In total, it was possible to find 34 papers with a relevant heading. From which, 17 were identified as useful for the report and 13 used for the employee chapter due to the usefulness to answer the research questions.
The Boolean search query looked as following:
“Operator 4.0” OR “Human factor in Automation” OR “Workforce and Automation” OR “Employee involvement in Automation” OR “Employee involvement SME) OR “Employee involvement and automation design” OR “Job autonomy automation project” OR “Job autonomy automation development” OR “Employee SME” OR “Employee involvement SME” OR “Employee automation SME” since: 2000-01-01
Literature Study on Automation
The study regarding Automation was conducted because of the need to understand what is important to consider when it comes to flexible Automation for SMEs. Moreover, to clarify the difference between the variety of automation solutions. The search terms used in each database are presented in table 2.
Method and implementation
Table 2 Search terms regarding Automation.
What is Automation Automation SME Robotics SME Flexible Automation SME Movable Automation
CoBots
Framework for Automation Framework implementing
Automation
The search followed the same steps as the previous search. In total, it was possible to find 20 papers with a promising heading. Thereof seven were identified as useful for the report. However, through the snowballing method additional four papers could be found. Hence 11 papers were used for the automation chapter because of the usefulness to answer the research questions.
The Boolean search query looked as following:
“Flexible Automation SME” OR “Movable Automation CoBots” OR “Framework for Automation” OR “Framework implementing Automation” since: 2000-01-01
Literature Study on Management
The literature study on Management was done to investigate the Management perspective. Besides, the goal was to find a framework that can be used by the management to implement successful flexible automation solutions. The research terms which have been used are presented in table 3.
Table 3 Search terms on Management. SME Change
management
Resistance to change Innovation at SMEs
Management SME Transaction phases of change
As described in the chapter before, the search was conducted in the same way with some minor adjustments to reduce the number of hits. The search terms related to Management were used without any time restrictions because of the relevance of old sources in this field. However, if the number of hits has been too extensive, the search was limited to ‘exact results’ or to ‘book, paper, journal’ results. With these adjustments, it was possible to carry out the research without any time limitations. In total, it was possible to find 36 papers with a promising heading. Thereof 23 were identified as relevant for the report. Through the snowballing method, additional 6 papers could be identified why the chapter Management chapter has been written in relation to 29 papers.
Method and implementation
The Boolean search query looked as following:
“SME Change management” OR “Resistance to change” OR “Innovation at SMEs” OR “Management SME” OR “Transaction phases of change”.
2.3 Empirical part
In the empirical part the case study and the expert involvement are explained. Moreover, the importance of the real-life aspects is explained and how it contributes to the study.
2.3.1 Case Study
The basis for the empirical part of this research is a single case study. The case study research helps to analyse a real-life setting and to gain an in-depth understanding of the case (Yin, 2018). The object of the analysis in the case was the investigation of the management and operator’s behaviour, motivation, and feelings for or against the new flexible automation solution. Besides, the case has been used to see how in a real-life situation an automation was implemented, why it was done, what went well and what could have been done better. The case study was chosen as a method because a real-life phenomenon that happened in the past should have been investigated (Saunders et al., 2016). The reason to have a retrospective view in the case study was that the implementing process but also the stages after the implementation needed to be examined. To enable the investigation, it was necessary to find a company that had implemented a flexible automation solution some time ago.
The focus group for the case study was the CEO, the production manager, and two employees of the company. The chosen operators had either worked with the machine before or have been involved to some levels into the automation process. For the case study it was important to involve someone of each hierarchical level in the company to investigate the whole perspective of the automation implementation process. For the case study, a SME with a low volume, high mix (LoHi) production was chosen. The company which was examined also collaborated in another research project named LoHiSwedProd what made the contact easier. Furthermore, it was confirmed that the company was interested in the topic, which was described as a good prerequisite for positive and supportive collaboration, according to Williamson (2002). The selected company was located in Sweden and had previously invested in a flexible automation solution.
Interviews
Research interviews are used when purposeful information from two or more people are required. The interviewer is listening attentively and asks concise and unambiguous questions to the interviewee who is participating voluntarily. Most often, research
Method and implementation
interviews are distinguished according to the structure of the interview, and the most traditional interview forms are structured, semi-structured, and unstructured (Saunders et al., 2016). In the presented thesis semi-structured interviews have been used. The semi-structured interviews gave the researcher the possibility to adapt the scope of the questionary. This was necessary as the interviewees and their background were variating. The researcher performed the semi-structured interviews with a list of themes, keywords, and questions to have the freedom to adapt to each interview situation (appendix 9.1 and 9.2). Due to the persistent COVID-19 pandemic, the interviews were performed as online interviews. Thus, the data collection was easier as the interviews were recorded and transcribed according to a later chapter.
Company interviews
The goal of the company interviews was to gain insights of the opinions and behaviours of the different people regarding flexible Automation, and to investigate if the case company considered literature-relevant aspects to implement the flexible Automation successfully. Furthermore, to investigate the employee perspective and the manager perspective on successful and not as successful things related to flexible Automation. Therefore, three questionaries have been developed (appendix 9.1 and 9.2). The questionaries were developed relating to the position of the people. Therefore, the questionnaire at each level was different but the same for the people with similar responsibility. The interviews have been carried out as online interviews in MS Teams. Each interviewee was interviewed alone and in a separate room to prevent influence from other people. Additionally, it was pointed out that the information will be anonymised and not publicised to other people in the company. The duration of each interview was around 60 minutes. Before the interview started, the research case was described and explained, for the person to understand the reason for interview.
2.3.2 Expert involvement
The involvement of experts in the study has been important to support the results of the literature study and to involve general real-life aspects of flexible automation implementation processes in the thesis. Therefore, two experts with different backgrounds have been interviewed. One expert (expert 1) has 40 years of experience in the field of automation implementation, and the second expert (expert 2) has worked with Management consulting related to automation for around 20 years. Expert 1 covered more technical aspects but also the employee view. Expert 2 covered the view of management. The interviews took around one hour each and were conducted online and recorded in MS Teams. The questionnaire (Appendix 9.1) for the interviews with the expert was developed broadly because the experts should have had the opportunity to speak about aspects that they thought to be important.
Method and implementation
2.4 Methods for the data analysis
This chapter presents how the literature review and interview data have been analysed. Moreover, how the findings have been presented is also explained.
In the analysis the results from the literature study have been connected to the empirical findings. Moreover, the not occurred aspects in the case company have also been mentioned. This was done relating to the time when the aspect should have been considered. The three categories “before”, “during” and “after the implementation” have been chosen as the whole implementation process should have been analysed. However, before this step could been carried out, it was necessary to transcribe each interview. The transcription eased the analyse of the interviews regarding the said things and non-verbal communication components (Saunders et al., 2016). The additional contextual information’s have been important to understand also the incidents which may have influenced the interviewee's answer (Saunders et al., 2016). The analysis process followed a grounded analysis method, which means that the data was analysed in relation to the data fragments of the literature study (Easterby-Smith et al., 2018). During the transcription process, the data was cleaned regarding not accurate data (Saunders et al., 2016). Besides, data sampling was performed which means that not relevant parts of the interview have not been transcribed to save time (Saunders et al., 2016). After the interviews had been transcribed, the researchers coded the transcriptions. Coding was described by Easterby-Smith et al. (2018) as an interpretive exercise which is mostly the first step to develop categories for the analysis of the interviews. It was used to categorise data with similar meanings to make the data accessible for further analysis (Saunders et al., 2016). After the interviews had been coded, the codes were categorised relating to the three steps of implementing an flexible automation. Lastly, the key points of each interview were summarised in the empirical findings to present the most relevant parts of each interview.
2.5 Research quality
The research quality can be measured through the reliability and validity of a research project (Saunders et al., 2016). In particular, for quantitative research, reliability and validity have great importance to ensure the integrity of the study (Saunders et al., 2016; Williamson, 2002). According to Saunders et al. (2016) the reliability is given if the research is replicable with similar findings. On the other hand, the validity is given when appropriate measures were used and if the analysis of the results is accurate and the findings can be generalised (Saunders et al., 2016). To have validity in the thesis work, the researchers were adopting triangulation which means more than one source of data collection were used (Saunders et al., 2016). It also increases the certainty that the data is telling the truth. Therefore, to have validity in the research project, the literature review, one case company and two experts were chosen for the data collection. Besides, these three different sources of data made it possible that the findings could be generalised for other automation implementation projects.
Method and implementation
The internal reliability in the thesis is given through the fact that the research is carried out in a research team, which ensures that the interviews were done without any biases, interpreted and analysis more correctly. According to Saunders et al. (2016) the involvement of more than one researcher in the interviews and also in the data analysis increases the quality of the research and its internal reliability. The external reliability is given in this work through the involvement of experts with a variety of experience and through the literature study. However, the case company results could vary from company to company. That is why the results of all three aspects of the research have been used to form the recommendation, which ensures that the results a more general and not just related to one case.
Ethics and moral
The ethical and moral aspects must been considered before a research process takes place (Saunders et al., 2016). It can be distinguished between the protection of the research subjects or information and the integrity of the research community (Easterby-Smith et al., 2018). According to Bell & Bryman (2007) there are ten main aspects which must be considered regarding ethics and moral in a research project. The following table 4 present the aspects and how they could be insured during this research project.
Method and implementation
Table 4 Ethical and moral aspects in research adapted from Bell & Bryman (2007). Aspects Solution for this research
No harm to participants The research was anonymised, and the interviews were conducted in a private room without other participants. Respecting the dignity of
research participants
The researcher drew attention that interviewees do not need to answer questions which they do not feel comfortable with.
Fully informed consent of research participants
Before each interview started, the researchers explained the aim and purpose of the research project and why they should be interviewed.
Protecting the privacy of research participants
The interviews were arranged together with the interview partners, and they were conducted in their company. Besides the questionnaires did not include any private questions.
Ensuring the confidentiality of research data
The interviewees have been informed that the interview will be anonymised and that no one else will see the interview. Besides for permission to record the interview was also asked.
Protecting the anonymity of individuals or
organisations
The collected Data was anonymised, and for the findings and data analysis, synonyms have been used.
Avoiding deception about the nature or aims of the research
The research and questionnaires have been developed to the best of knowledge and belief with respect to the ethical and moral aspects.
Declaration of affiliations, funding sources and conflicts of interest
This thesis does not have any type of affiliations since it is writing without independent from the researchers.
Honestly and transparency in
communicating about the research
The whole research process was explained in detail to gave as much transparency as possible
Avoidance of any misleading or false reporting of research findings.
To prevent misleading or false findings, the thesis has been written in a research pair and in close cooperation with other researchers.
Summarising the presented research project was developed in the knowledge of the ethical and moral aspects in research.
Theoretical framework
3
Theoretical framework
This chapter presents the main theoretical areas related to the study including “Automation for SMEs”, “Change Management”, and “Employee involvement”.
3.1 Change Management
The rate of change is rapidly escalating in all organisations to remain competitive as suppliers of services and goods to the larger organisation and at the macro level. The phenomenon of change is considered evidence to survive; therefore, many theories stress the importance of managing the change efficiently and effectively. Thomas et al. (2011) described the change as a common, ongoing, and anticipated process. The volatile and ever-changing global environment urges organisations to develop the capability to adapt and change (Abrell-Vogel & Rowold, 2014). If themed by being rapid, efficient, and continual, this capability to adapt and change will distinguish the winners from the losers in today’s rapidly changing, highly competitive environment (Lorenzi & Riley, 2000).
Lorenzi & Riley (2000) define change management as “the process by which an organisation gets to its future state, its vision.”. Lorenzi & Riley (2000) first stressed creating a vision, then encouraging individuals to change agents to achieve that vision. Moreover, Lorenzi & Riley (2000) also characterises the plans needed by these change agents: realistic, future-oriented, providing a total systems approach. According to Lorenzi & Riley (2000), change in an organisation is often identified as one of four types: operational changes, strategic changes, cultural changes, political changes. Operational changes target how the business's ongoing operations are done, for example, the Automation of a particular area. Each of these types has its impact at a different level of the organisation; for example, operational changes have their biggest effect at the organisation’s lower level (Lorenzi & Riley, 2000). In some cases, change is accompanied by something called resistance to change. Resistance to change is described as the refusal to adapt to altered circumstances, which can be organised, overt or covert, or induvial (Coch & French, 1948). In all three cases, resistance to change is considered to be disruptive (Coch & French, 1948).
Change at SMEs versus change at large companies:
There are a couple of characteristics having an impact on SME behaviour in change management. Ates & Bititci (2011) identified some of these characteristics: the firefighting approach, limited resources, command and control culture, poor management skills, and reacting to external stimuli. When it comes to change management, most research is based on large companies with a narrow focus on SMEs. However, the way SMEs run the business and how they adopt models and theories are different from their larger counterparts (Sarkar et al., 2001). Hence, it is significant to consider the unique characteristics and pattern of behaviour in managing change at SMEs when studying change management capability in SMEs’ context.
García-Theoretical framework
Morales et al. (2007) stress the importance of different management for SMEs from large organisations to be successful. Moreover, Martin-Tapia et al. (2008, p.59) define some of the managerial differences between SMEs and large companies affecting the way SMEs conduct strategic planning and implementation: “shorter lines of communication and closer interaction [within the SMEs], the presence of a founder’s vision, flexibility in managing external relationships, and an entrepreneurial orientation”. Accordingly, change in any organisation is realised through human interacting with other human beings and with all other considerations of production, it is understandable that the pathways for constructing strategic change must differ as the parameters of human interaction differ, and firm size is one of the noteworthy variables (Sloan et al., 2013).
Lewin’s model of change:
The change model developed by Lewin (1947) includes these elements: field theory, group dynamics, action research, and the three phases of change (Lewin, 1947). However, Bakari et al. (2017, p.155) mentioned some of the criticism the model received “…has been criticized for its linearity, unsuitability for continuous change and inability to incorporate leader-follower relationship dynamics”. Moreover, Cummings et al. (2016, p.33) stated that “Lewin has been criticized by scholars for over-simplifying the change process and has been defended by others against such charges”. The following text will explain each of these elements and is based on Lewin (1947). Field theory reveals that there are symbolic forces that are being maintained to form the present situation, which in turn affect the individual behaviour. According to Lewin (1947), change is a consequence of changes in the forces in the symbolic field. Thus, the recognition of these forces offers the key to realise people’s motives and enable leaders to influence people’s behaviour. To identify the field forces, Lewin (1947) suggests digging into the cognitive and behavioural traits of group life through conducting interviews with the people concerned. Group dynamics assert group pressure constrains individual behaviour. Thus, change management should focus on the group level rather than on the individual level. Action’s research suggests two aspects: the first one is that individuals should feel the importance of change, which includes both being able to understand one’s momentary status quo and the difference in comparison to the future status quo. The second one is choosing and implementing the most appropriate solution to the situation at hand, which includes evaluating and analysing all possible solutions.
Finally, Lewin (1947) declared that a complete change management process is segmented into three phases, as presented in figure 3. The first phase, unfreeze, is when a process is being unfrozen through stimulating the process contributors to the importance of change by defeating their defence mechanisms and creating a sense of urgency. Some of the actions within this stage may include defining what needs to change survey the company, ensuring support from management-motivate your issue,
Theoretical framework
and creating the need for change- communicate the change. The second phase, change, aims at empowering changing forces to ensure that the change is happening. Lewin (1947) stresses looking at change as a process rather than an event. Therefore, this phase requires creating a detailed plan of actions and involving people to test the proposed change. This stage is often difficult as it involves fear and uncertainty connected with change. Lewin (1947) stresses coaching to overcome fear and having clear communication to prevent losing sight of the future state. Moreover, Lewin (1947) emphasises two key drivers of long term and successful effectiveness of the change implementation- leadership and information flow. The third phase, refreezing, requires stabilising the transformation process to be embedded into the current system, such as policies, practices, and culture. This supports the maintenance of the new status quo and prevents the participants from returning to their previous state (Lewin, 1947). Some of the actions in this phase include identifying change supports and barriers, sustain the change long term through establishing feedback processes and creating a rewards system, offer training, support, and communication, and celebrate success (Lewin, 1947).
Figure 3 Lewin’s model of change adapted from Lewin (1947). Kotter’s model of change:
Change is never easy, and studies of large-scale organisational change show many difficulties as it can be time, energy, and attention consuming. However, through understanding the change process and applying that knowledge to manage and lead the change, the results can be improved (Ates & Bititci, 2011). This includes a comprehensive understanding of the steps needed to be taken for the process to be successful (Kotter, 1995). Kotter (1995) also suggested a model to facilitate change in the organisation. This model is comprised of eight stages that an organisation should go through. Each stage must be adequately addressed if the required change is to happen and come to be part of a new operating environment. These stages are explained and shown in table 5. However, this model was criticised by (Kesken & Ilic, 2008) for deficient understanding certain aspects of human nature and its psychological reaction to change. Moreover, Kesken & Ilic (2008) argued that the model should provide a balanced message of the advantages and disadvantages of change.
Theoretical framework
Table 5 Model for leading change adapted from Kotter (1995, p.61). Eight steps to transforming your organisation
1. Establishing a sense of urgency: examining the market and competitive realities Identifying and discussing crises, potential crises, develop scenarios or major opportunities.
2. Creating the guiding coalition: assembling a group with energy and power to lead the change effort, encouraging the group to work together as a team
3. Developing a vision and strategy: creating a vision to help direct the change effort, developing strategies for achieving that vision
4. Communicating the change vision: using every vehicle possible to communicate the new vision and strategies, teaching new behaviours by the example of the guiding coalition. Address peoples' concerns and anxieties
5. Empowering broad-based action: getting rid of obstacles to change, changing systems or structures that seriously undermine the vision, encouraging risk-taking and non-traditional ideas, activities, and actions
6. Generating short-term wins: planning for visible performance improvements, creating those improvements, recognising, and rewarding employees involved in the improvements
7. Consolidating change and producing more change: using increased credibility to change systems, structures, and policies that don’t fit the vision. Hiring, promoting, and developing employees who can implement the vision. Reinvigorating the process with new projects, themes, and change agents
8. Anchoring new approaches in the culture: articulating the connections between behaviours and corporate success. Developing the means to ensure leadership development and succession
Kotter (1995) argues that damage control experts and management control systems serve a critical purpose, which can sometimes be blinding from the important reality. Complacency, according to Kotter (1995) also, can be deadly. Moreover, the turbulent world crisis can offer an opportunity to increase needed urgency, an opportunity that must not be overlooked. This urgency can be embedded in a new competitive threat or emergent of an ample opportunity. The reaction to that is by creating a strategic initiative and appointing a team to make the change happen. Kotter (1995) claims that in both large and small organisations, a successful guiding team should be consist of three to five people through the first year of the renewal process. If the managerial ranks have a high sense of urgency, it helps immensely in putting a guiding coalition together. Usually, companies failing in the second phase undervalue the difficulties joined with producing change and the significance of guiding coalition.
Kotter (1995) emphasised the importance of employee engagement, employee collaboration in order to establish a more productive and positive culture. Kotter (1995) also claims that with the lack of reasonable vision, all transformation efforts can dissolve into a list of incompatible and confusing projects that can lead the organisation in the unwanted direction or to nowhere at all. Examples of failed transformation
Theoretical framework
initiatives showed plenty of plans and programs but no vision. Another reason could be that the management had a sense of vision, but it was too complicated or blurry to be achieved. Moreover, Kotter (1995) gives a specific description for the vision by saying, “if you can’t communicate the vision to someone in five minutes or less and get a reaction that signifies both understanding and interest, you are not yet done with this phase of the transformation process.". Kotter (1995) likewise declares that it is impossible to lead change unless most people are willing to help, which includes making short-term sacrifices. These sacrifices will not be made unless employees believe that beneficial change is possible and without credible communication that could capture the hearts and minds. With this said, it is apparent that creating a vision is not enough; rather, there is an urgency for it to be communicated flawlessly throughout the organisation. Additionally, it is also significant to confront people's anxieties and worries, candidly and publicly.
Kotter (1995) reveals that it happens too often that the employee understands the vision and is willing to make it happen, yet some obstacles block the path. In some cases, these obstacles are in the person's head, making it challenging to convince them that no external barrier exists. Moreover, if the blocker is a person, Kotter (1995) emphasises the importance of treating that person fairly in a consistent way with the new vision. With that said, it is recommended to identify the source of resistance to the change and work on removing their concerns and creating pre-emptive solutions around their resistance. Moreover, find sources that can underpin your change's value by delivering on it, for example, industry leaders or expertise. Kotter (1995) stresses the importance of short-term wins by saying, "without short-term wins, too many people give up or actively join the ranks of those people who have been resisting change". The change process is often long and takes a long time to reap any rewards, which can cause failure if individuals think their effort was wasted. That's why it is significant to have shorter-term targets and create some short-shorter-term wins that can be important for motivating and directing individuals.
Kotter (1995) claims that plenty of change projects fails due to early declaration of victory when this quick win is the spark of what needs to be done to attain long-term change. It is important to consider each success an opportunity to build on what went right and to identify what can be improved. All this can be achieved by setting goals, building on the momentum gained, and bringing in new change leaders and agents for the change coalition. Finally, Kotter (1995) also underlines the importance of having the change part of the organisation's core to make change stick. Accordingly, Kotter (1995) emphasises making continuous efforts to guarantee the visuality of change in every aspect of the organisation. This can be done by talking about progress on every occasion, including the change values and ideals when training and hiring new staff, recognising key members of the change coalition, and ensuring that the staff remembers their contributions.
Theoretical framework
Resistance to Change:
According to Zander (1950), resistance to change is a behaviour to protect the individuals from the impacts of imagined or real change. This behaviour serves to preserve a status quo, seek out to disrupt, challenge, or invert prevailing discourses, assumptions, and power relations (Zaltman et al., 1977). In general, all types of resistance to change and the justifications behind it are distinguished. The forms of resistance indicate how an individual exhibits when he or she is exposed to change. Typically, two categories are being recognised for these behaviours: passive resistance and active resistance, both are called disruptive resistance(Ford et al., 2008). Active resistance involves finding ridicule, fault, appealing to fear, and manipulation. Passive resistance involves verbal agreement but not following through, withholding information, and feigning ignorance (Bolognese, 2002).
Ford et al. (2008) refer that most of the literature regarding change management and resistance to change is perceived from the standpoint of those seeking to bring about change, while change receivers create unreasonable barriers to prevent this change. Thus, resistance to change is primarily related to the employees. Ford et al. (2008) suggest perceiving resistance as a conflict, which is not only negative but might play a positive role. This conflict might be in the form of criticism, debate, or disagreement, which do not essentially equate to negative resistance, rather a source for better understanding as well as additional solutions and options, constructive resistance (Ford et al., 2008). Gilgeous & Chamers (1999) suggest six initiatives for managing change. These six initiatives address the following areas: stress, self-esteem, competency, predictability of change, perceived relationships between employees and employers, and organisational readiness for change. The initiatives suggest policies for managers to follow to assist in managing people element of change. For each of these six initiatives, Gilgeous & Chamers (1999) suggest action guidelines be implemented in order to prevent resistance. Moreover, he suggests when to act during change.
Links between leadership style, performance, and change management:
According to Dess et al. (2019), leadership is defined as “the process of transforming organisations from what they are to what the leader would have them become” which indicates the significant role leadership implies in leading change. Samad (2012) referred to the increasing body of literature spotting the important impact the leader’s characteristics have on strategic direction and organisational performance. There are a couple of studies that found a relationship between performance and leadership. For example, Lim (1997) found that a mix of transformational and human resources orientation types bring in enhanced performance. This comes in line with what Keller (2006) states. According to Keller (2006), it is the leader's task to prepare people to exert high efforts in order to achieve targets that were unachievable and to attain the action of employees to do their best for the organisation. Consequently, this indicates a strong connection between the organisational performance and leaders.
Theoretical framework
Leadership theories describe leadership as transformational and transactional. On the one hand, transactional leaders concentrate on the role of organisation, group performance, and supervision (Yasin et al., 2014). On the other hand, transformational leaders focus on improving motivation and follower’s engagement by guiding their behaviours toward a shared vision (Yasin et al., 2014). Moreover, Yasin et al. (2014) argue that transformational leadership is themed by challenging the current state and is change-oriented. Judge & Piccol (2004) describes a transformational leader as a leader who works with teams in order to identify needed change, create a vision to steer the change through inspiration, and implement the change in coinciding with committed group members. Additionally, Jung et al. (2008) state that transformational leadership is more important than other styles of leadership when the goal is to achieve superior performance because transformational leadership improves organisational innovativeness by taking initiatives. When it comes to change, Bass (2017) stated that the research in the leadership literature endorses the idea that transformational leadership is better for non-routine situations. While in situations where the focus is on maintaining status quo, transactional leadership fits better as it emphasises clarification of goals, task completion, and followers compliance (Bass, 2017). Transformational leaders can effectively change the status quo through exhibiting the proper behaviours at the proper stage during the transformation process (Eisenbach et al., 1999). According to Ford & Ford (1994) the implementation of change should take place when the leader craft a vision through intellectual stimulation, where leaders set targets for employees to motivate them rethinking old ways of doing business. For this process a transformational leader would be a great mediator through creating and promoting a culture that supports behavioural control and team-decision making (Manz & Sims, 1991).
The stages of psychological reaction:
While people go through change, they experience a range of cognitive and emotional states. Whether the transition is imposed or voluntary, desired on undesired, it evolves through a cycle of reasonably predictable stages as described in figure 4 (Hayes, 2014). Hayes (2014) also argues that the person exposed to the transition has to work through all the stages for a successful transition. Thus, understanding this process can help managers and individuals. The text below about the seven transition phases is based on Hayes (2014):
Theoretical framework
Figure 4 Transition phases (Hayes, 2014, p.261).
Shock: happens when people have not been warned of changes. In this phase, people may feel paralysed and overwhelmed. Moreover, people can lack the ability to take in new information, plan, and think constructively due to anxiety and panic. Consequently, this leads to a state of immobilisation. Even when people feel positive and the transition is perceived as a desirable gain, they can still have difficulty in planning, taking constructive action, and experience a state of immobilisation. The intensity of this stage is directly affected by the degree of desirability and preparedness of the transition. Hayes (2014) recommends actions to be taken in order to facilitate progress through the shock phase. Moreover, Hayes (2014) suggests providing timely opportunities and information to be included in relevant decision-making. If not possible, the managers can consider different ways of announcing the change.
Denial: This stage is themed by retreatment from the reality of change. Negative changes can be denied, and attention can be displaced to less important matters. Moreover, any potential threat to the status quo is managed by behaving in the usual way, while activity and energy are devoted to the familiar and known. Consequently, the refusal of change and clinging to the past lead to a decrease in anxiety. It is considered that resistance to change at this phase is the highest. For this matter, Hayes (2014) urges change leaders to diagnose what is being denied. Management can help those in denial by confronting what is being denied, repeating the message, drawing attention to evidence, experience, and examples that show the change is happening, finding ways to ensure the engagement with the reality of the change, and getting people to do practical things related to the change.
Depression: Once the individual acknowledges that change is apparent and things cannot continue, as usual, depression arises with a feeling that the situation is beyond their control. This stage is themed by sadness, anger, confusion, and withdrawal. The feeling of depressant is evident even in situations where change was initially
Theoretical framework
passionately supported. In this phase, the change starts to be experienced as stressful. Hayes (2014) induces the leaders’ intervention to help others accept and understand the situation by listening, providing support, accepting, and adopting noncritical reaction to the expressed feelings, help people to work on their feelings, and help them identify opportunities to move on.
Letting go: this phase implies letting go of the past, which includes accepting reality for what it is. Hayes (2014) suggests a couple of actions leaders can do to help people let go of the past. This includes explaining the need for change and how beneficial it is, providing targets linked with movement towards the desired state, and removing symbols of the past in the workplace.
Testing: This phase shows more creative, active, experimental involvement in the novel situation. This involves new ways of being and behaving are tried out, and more energy is available. However, irritability and anger can be easily aroused in case the new behaviour is not successful. Moreover, this stage may include trial and error behaviour or the cycle of plan, do, study, and act. Hayes (2014) suggests some ways leaders can do to encourage testing. This includes creating the time, resources, and space required to test, promote creative thinking, encourage risk-taking, avoid punishing those who make mistakes, act as a mentor, praise, and support success, and provide feedback.
Consolidation: The testing process outcome is some new ways of behaving and being, which are adopted gradually as the new norm. This phase progresses parallelly with the testing stage, and to begin with, every so often, there is more rejecting and testing than consolidating and testing. It includes reflecting on new experiences and evaluating if they offer a foundation for a constructive approach to move forward. When consolidation happens, it includes reflecting on the outcome of the test and usage of any learning to be the base and inform the choice of additional testing practices. Hayes (2014) argues that consolidation can be facilitated by reviewing learning and performance, aiding others to identify the new state's desired features, rewarding achievement, encouraging team spirit, and broadcasting their successes.
Internalisation, reflection, and learning: once the changed behaviour is the norm, is the new natural order of things, and occurs subconsciously, the new transition is completed. In the perfect case scenario, the past would be left behind. During this stage, personal growth and learning that benefit future transitions can be recognized. Hayes (2014) recommends some actions to facilitate reflecting, learning, and internalisation. These actions include helping people review the change experience by asking questions and running review workshops, carrying our formal post-implementation reviews, and getting people to share their experience.
Theoretical framework
3.2 Automation
Automation is defined by the Oxford Dictionary of Mechanical Engineering (2019) as “Mechanisms and systems that reduce or eliminate human labour; often applied specifically to manufacture and inspection on production lines” (Atkins & Escudier, 2019, p. 395). A frequently used form of automation are Robots (Atkins & Escudier, 2019). Robotic applications can be distinguished between flexible or fixed solutions (traditional). The traditional solution is mainly installed in automobile industries with around 65 % according to Djuric et al. (2016). These can be explained by the properties of traditional robotic applications, which require a lot of space, complex and time-consuming programming (Andersson et al., 2020). Besides, they are fixed installed, only profitable with medium to large lot sizes, and used for periodic repeatable tasks which infrequently are changed (Andersson et al., 2020; Djuric et al., 2016). On the other hand, flexible solutions for instance, collaborative robots (CoBot), are mostly easy to program and lightweight, besides also without guards usable, intrinsic safe, slow in a collaborative operation, and they are able to work with humans at the same task (Andersson et al., 2020; Matheson et al., 2019). Additionally, they are usable for assembly, pick and place applications. However, compared to a traditional solution, a CoBot solution delivers worse results in terms of speed, precision, and payload (Andersson et al., 2020; Matheson et al., 2019).
The characteristics of traditional robotic solutions contradict today’s market development, which demands reduced lead times, mass customisation, and fast product changeover (Matheson et al., 2019). Production companies and their manufacturing systems are required to be flexible, fast and easily changeable, and already cost-efficient with low volume to serve the changing market (Zheng et al., 2019). The term flexibility has received a lot of attention during the last few years from both the SME industry and academia due to external factors such as changing consumer preferences and increased competition (Wadhwa, 2012). The fast-changing demands require the manufacturer to be more flexible on the production and product level (Wadhwa, 2012). The production flexibility of a company is the ability to compete in a market that has a fast and frequently changing demand, which requires to have short implementation times for new and major modified products (Wadhwa, 2012). In contrast, “product flexibility relates to the ability of the system to cope with changes products to be processed by the system” (Wadhwa, 2012, p. 448). As stated by Wadhwa (2012), most often, product flexibility is used to achieve flexibility in a manufacturing system. The product flexibility can be increased with a focus at the machine or system level. Thereby according to Wadhwa (2012), flexibility at the machine level is the basic framework for other flexibilities.
Flexibility in Automation
Löfving et al. (2020, p. 8) highlighted that “flexible automation is […] [a] technology that can perform a variety of industrial tasks and is not dedicated to one machine or
