Abstract: Nowadays, in order for small and medium scale enterprises to excel in performance, it is necessary to have congruency among the manufacturing functions and the operational priorities. In this paper a model is presented to know the relationship between the manufacturing functions, operation priorities and manufacturing performance. Using data collected from small and medium scale manufacturing enterprises in Mumbai and suburban region, this study examines the seven hypothesis based on the relationship between manufacturing functions, priorities and perfomance. The structural equation model is tested using Amos7 software to test the hypothesis. The results show that there exists a positive relation between manufacturing functions and operation priorities as four out of six the dimensions measured such as Process control and implementation, Management of resources, Management of people, and Partnership with supplier are positively related, while two dimensions Training and developing and Teamwork are not positively related. Findings also support strong impact of operation priorities with growth in productivity as a measure of performance.
Keywords: Manufacturing functions, operation priorities, manufacturing performance, structural equation model
Recieved: 12.09.2012 Accepted: 06.01.2012 UDC: 5.017.2