Leadership and Productivity: A Study of US Automobile Assembly Plants

36 Pages Posted: 13 Apr 2022 Last revised: 23 May 2022

See all articles by Soledad Giardili

Soledad Giardili

School of Economics, University of Edinburgh

Kamalini Ramdas

London Business School - Department of Management Science and Operations

Jonathan Williams

University of North Carolina (UNC) at Chapel Hill

Date Written: April 08, 2022

Abstract

We examine the effect of plant managers on productivity using unique matched manager-plant panel data on US auto assembly plants during 1993-2007. Our econometric approach is two-pronged. Our first approach relies on using the panel nature of our data to measure variation in productivity due to managerial influence. We estimate the interquartile range of the effect of individual plant managers on average hours-per-vehicle to be about 30%. Further, we find that plant managers’ experience with the models that are in production ameliorates the negative impact of new model introductions on productivity. We also observe evidence that managers' plant-specific tenure has a positive impact on productivity. In our second approach, we use high-frequency time-series data, along with structural-break tests and machine-learning methodologies, to predict variation in production using plant manager switches. We find that a plant manager's identity is predictive of changes in both the mean and variance of production, further highlighting their channels of managerial influence. These findings are robust to narrowing the sample to focus on retirements as an exogenous source of managerial switches.

Keywords: productivity, leadership, plant manager, shop floor, automobile industry, managerial experience

JEL Classification: L2, M2, J24

Suggested Citation

Giardili, Soledad and Ramdas, Kamalini and Williams, Jonathan W., Leadership and Productivity: A Study of US Automobile Assembly Plants (April 08, 2022). Available at SSRN: https://ssrn.com/abstract=4069025 or http://dx.doi.org/10.2139/ssrn.4069025

Soledad Giardili

School of Economics, University of Edinburgh ( email )

31 Buccleuch Place
Edinburgh, EH8 9JT
United Kingdom

Kamalini Ramdas (Contact Author)

London Business School - Department of Management Science and Operations ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

Jonathan W. Williams

University of North Carolina (UNC) at Chapel Hill ( email )

102 Ridge Road
Chapel Hill, NC NC 27514
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
631
Abstract Views
1,990
Rank
87,598
PlumX Metrics