Proprietary technologies: building a manufacturer's flexibility and competitive advantage

When barriers to entry are limited, technologies often contribute little to a firm's long-term competitive advantage (CA). This research argues that a manufacturing firm's proprietary technologies can overcome this limitation because they are rare, inimitable, valuable and non-substitutable. Technologies, which are dedicated by suppliers to meet a manufacturer's needs, are also a part of a firm's strategic assets. Based on 201 responses from senior managers and executives at US manufacturers, results show that proprietary technologies positively influence suppliers' dedicated technologies. In addition, these two types of technologies influence differently a manufacturing firm's flexibility and CA. Proprietary technologies indirectly impact flexibility and directly impact CA, while suppliers' dedicated technologies directly impact flexibility and indirectly impact CA. The combination of the two technology resources creates the overall success for manufacturer.