• International Journal of Technology (IJTech)
  • Vol 13, No 1 (2022)

Ensuring the High Performance of Design and Engineering Firms in Mexico’s Aerospace Industry: A Qualitative Comparative Analysis

Ensuring the High Performance of Design and Engineering Firms in Mexico’s Aerospace Industry: A Qualitative Comparative Analysis

Title: Ensuring the High Performance of Design and Engineering Firms in Mexico’s Aerospace Industry: A Qualitative Comparative Analysis
María Aline Manzo, José Carlos Rodríguez

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Cite this article as:
Manzo, M.A., Rodríguez, J.C., 2022. Ensuring the High Performance of Design and Engineering Firms in Mexico’s Aerospace Industry: A Qualitative Comparative Analysis. International Journal of Technology. Volume 13(1), pp. 5-15

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María Aline Manzo Universidad Vasco de Quiroga, Facultad de Negocios, Morelia, 58090, Mexico
José Carlos Rodríguez Universidad Michoacana de San Nicolás de Hidalgo, Instituto de Investigaciones Económicas y Empresariales, Ciudad Universitaria, Morelia, 58004, Mexico
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Abstract
Ensuring the High Performance of Design and Engineering Firms in Mexico’s Aerospace Industry: A Qualitative Comparative Analysis

The aerospace industry is considered strategic for economic and national security reasons because it generates short- and long-term benefits for countries, such as new investments, technology transfers, and spillover. Therefore, this research aimed to identify the necessary and sufficient conditions for guaranteeing the high performance of design and engineering firms (DEFs) in Mexico’s aerospace industry. Taking a resource-based perspective enhanced by absorptive capacity and entrepreneurship approaches, this study contributes to understanding the causal ambiguity and social complexity characterizing the relationship between firms’ performance and resource allocation. Additionally, this research used a fuzzy-set qualitative comparative analysis (fsQCA) method to gain insight into the configurations (i.e., sets of resources) that lead firms to achieve high performance levels (HPLs) in Mexico’s aerospace industry. The results demonstrated that absorptive capacity, innovation capacity, entrepreneurial capacity, research and development activities, and specialized human resources are necessary conditions for achieving HPLs.

Aerospace industry; Design and engineering firms; fsQCA; High performance levels; Mexico

Introduction

France, Germany, the United Kingdom, and the United States are global leaders in the aerospace industry. Nevertheless, new players (including research, production, and manufacturing centers) have recently emerged in Brazil, China, India, Mexico, and Singapore, lowering production costs for aircraft components and other mechanical and electronic systems through intercompany collaboration (Bédier et al., 2008; Casalet, 2013). Emerging economies aim to pursue innovation and disseminate new knowledge to reduce the technological gap between themselves and industrialized economies (Fu et al., 2011). Overall, the aerospace industry in emerging economies has focused on developing joint venture projects between foreign and local investors and other stakeholders to fulfill original equipment manufacturers’ (OEMs’) requirements (Bédier et al., 2008; Casalet, 2013; Deloitte, 2019).

In this regard, Mexico has engaged in successful collaboration and implemented strategic actions, such as export promotion and research and development (R&D) efforts, to develop joint ventures, which, combined with the government’s promotion of technology transfer, have led to the growth of the country’s aerospace industry (Goldstein, 2002; Goldstein, 2006; Flores and Villareal, 2017). In fact, Mexico is considered one of the most important investment locations in the aerospace industry and an example of a consolidated aerospace industry that aims to boost innovation (ProMéxico, 2016; Flores and Villareal, 2017). Typically, design and engineering firms (DEFs) have driven the aerospace industry in Mexico, and their performance relies heavily on creating and disseminating new knowledge and venturing into different innovative areas within firms to expand their client portfolios with new products, services, and technologies (FEMIA, 2015).

From a theoretical perspective, the resource-based view considers causal ambiguity and social complexity as two essential features for understanding and explaining firms’ performance (Barney and Clark, 2007). Qualitative comparative analysis (QCA) deals with causal complexity by analyzing configurations (i.e., sets of resources) resulting from combinations of different conditions (i.e., resource allocations; Ragin, 2008; Mello, 2021). This paper argues that the causal ambiguity and social complexity considered by the resource-based view can be analyzed using QCA methods to investigate complex causal processes (Wagemann, 2012; Parente and Federo, 2019; Gerrits and Pagliarin, 2020). QCA approaches explain how the presence or absence of different conditions in alternative configurations can result in similar outputs (Ragin, 2008). The set-theoretic relations in QCA employ the concepts of equifinal, conjunctural, and asymmetric causation as explanations for causal complexity (Wagemann, 2012), which in this research related to Mexico’s aerospace industry. The research question underpinning this study was as follows: What are the necessary and sufficient conditions that lead DEFs in Mexico’s aerospace industry to achieve high performance levels (HPLs)?

The results suggest that five conditions are necessary for DEFs in Mexico’s aerospace industry to achieve HPLs: R&D activities, entrepreneurial capacity (EC), absorptive capacity (AC), innovation capacity (IC), and specialized human resources (SHR). The results also suggest that R&D and EC are crucial for achieving HPLs, while AC, IC, and SHR are peripheral to the desired outcome. Finally, this study identified some configurations leading to HPLs in DEFs in Mexico’s aerospace industry. In this country, small- and medium-sized companies share risk through alliances and joint research projects, mainly supported by the National Council for Science and Technology (CONACYT). The results suggest that DEFs can develop firm-level strategies for managing the resources and processes underpinning the R&D activities, entrepreneurship, and innovation that will lead to high-performing DEFs in Mexico’s aerospace industry.

Besides this introduction, the paper is organized into four sections. Section 2 presents the literature review that supported the study. Section 3 discusses the fuzzy-set qualitative comparative analysis (fsQCA) model employed in the research for data collection, case selection, and analysis. Section 4 evaluates and discusses the empirical results, and Section 5 presents concluding remarks. 

Conclusion

Highly innovative industries require resources to innovate and constantly outperform their competitors, and DEFs in Mexico’s aerospace industry likewise require continual innovation. In this research, AC, IC, EC, SHR, and R&D activities were all necessary conditions for achieving HPLs; however, they did not necessarily have to be present simultaneously to achieve the desired outcome. The causal complexity principle explains that DEFs in this industry may develop a sustained competitive advantage. The conditions evaluated in this study may explain the performance of firms in other countries resembling Mexico, but they may differ from the conditions in industrialized countries with different characteristics for highly innovative industries.

    Nevertheless, the parsimonious and intermediate solutions suggest that R&D activities and EC are central conditions, while AC, IC, and SHR are peripheral conditions. The analysis of central and peripheral conditions allows conclusions to be drawn regarding the causal essentiality of specific combinations of causal conditions. Central conditions are critical to the survival of DEFs in Mexico’s aerospace industry, and the causal complexity in this analysis revealed how DEFs can develop a sustained competitive advantage in the global aerospace industry. The results indicate that R&D activities and EC are central conditions in this process, and DEFs must constantly invest in R&D efforts to promote innovation and improve AC. Certainly, R&D activities and SHR are critical for exploiting profitable projects in Mexico’s aerospace industry.

      Finally, further research should consider other causal conditions in the analysis of HPLs, such as the financial strategies of DEFs in Mexico’s aerospace industry that support innovation development. Indeed, the aerospace industry is high risk, requiring firms to carefully manage their financial conditions.

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