When discussing profitability in the manufacturing industry, an efficient sourcing function invariably plays a significant role. Additionally, recent inflation and the rising prices in Europe have further emphasised the importance of sourcing in a company’s financial performance.
Sourcing has also played a central and growing role in the manufacturing industry where companies often focus on their core competencies and outsource the remaining operations to be handled by global supply chains. These factors – along with the ability of sourcing to directly impact the financial results of a company through purchase prices – provide an almost self-evident context for the dissertation to focus on profitability management.
Addressing management challenges at the employee level
Profitability management is typically studied at the organisational level, and causalities are sought in areas such as company strategy, processes, or available resources. Sundberg’s dissertation delves deeper into the subject and examines how individual employees ultimately transform company goals into outcomes with their actions.
A framework created in the dissertation relies primarily on management theory but also incorporates behavioural sciences, particularly the self-determination theory. The framework describes how intended profitability management is transformed through employees’ perceptions into individual actions which collectively determine organisational outcomes.
The dissertation relies on a rich dataset collected from eight manufacturing companies operating in Finland. The study examines how profitability management appears in the companies and how employees perceive autonomy granted through management control in sourcing.
The study indicates that autonomy is highly valued in sourcing, especially the freedom to choose the means to achieve goals. Autonomy was also found to be
an integral part of sourcing, and it increased employee satisfaction, motivation and resulted in positive performance.
Overall, Sundberg's dissertation provides the scientific community with a new framework and perspective for examining profitability management. Furthermore, from a practical standpoint, the dissertation familiarises readers with related management theory and provides insights into improving sourcing management through employee autonomy.
Jaakko Sundberg, residing in Pirkkala, Finland, works as a Regional Commodity Manager at AGCO Power Oy. AGCO is a global agricultural machinery manufacturer and its subsidiary, AGCO Power, focuses on providing power solutions, such as engines, for these machines.
Public defence on Friday 25 August
The doctoral dissertation of M.Sc. Jaakko Sundberg in the field of industrial engineering and management titled Profitability Management as an Enabler of Business Performance Through Employee Autonomy in Sourcing will be publicly examined at the Faculty of Management and Business of Tampere University at 12.00 on 25 August 2023, in the Pieni sali 1 auditorium of the Festia building on the Hervanta campus. The Opponent will be Adjunct Professor Ilkka Sillanpää from the University of Oulu while Professor Teemu Laine from the Faculty of Management and Business at Tampere University will act as the custos.
The doctoral dissertation is available online.
The public defence can be followed via a remote connection.
Photo: Hanna-Riikka Sundberg