ABSTRACT
The annual increase in productivity of the United States in the past ten years is the lowest among all industrial nations, including Japan, West Germany, France, Italy, and England. Kantrow and Gerwin argue that flexible technology is an essential element to increase a firm's long-term competitive position. Many advantages can be enumerated to support the acquisition of flexible manufacturing technology: quick response to the change in market demand, lead time reduction, increased demand due to increased product flexibility, and improved quality of goods and services produced. Many firms are finding that their available tools for evaluating investments in flexible technology often contradict the intuition of their managers. Kaplan suggests that managerial judgement be applied to decide whether the strategic benefits of an investment in flexible technology outweigh the difference, or gap, between the investment cost and the quantifiable benefits.
