| Author: | Lam, Kwong Man |
| Title: | An exploratory study of the critical capabilities of original equipment manufacturers in the cosmetics industry |
| Advisors: | Cheng, T .C. Edwin (LMS) Choy, Petrus (LMS) |
| Degree: | D.B.A. |
| Year: | 2021 |
| Subject: | Cosmetics industry -- Management Industrial management Hong Kong Polytechnic University -- Dissertations |
| Department: | Faculty of Business |
| Pages: | xiv, 310 pages : color illustrations |
| Language: | English |
| Abstract: | The global cosmetics market has continued to record a significant and strong growth over the years as one of the industries sustaining the highest level of potential for further development and growth. At the overall market growth of the industry has been characterized by its rapid emergence of new brands, new geographic markets and new sub-categories of trendy cosmetics products, all fuelled by worldwide adoption of digital transformations and technologies. The increasing demand from legacy, and both independent and private label brands has been boosting a tremendous growth of the cosmetics original equipment manufacturing of the cosmetics industry. According to Adroit Market Research (2019), the global sales revenue of the cosmetics original equipment manufacturing has reached USD50.91 billion in 2018 and it is unanimously agreed that the market will continuously be growing by a compound annual growth rate of approximately 5.3% to garner USD73.08 billion by 2025. The growth of the cosmetics original equipment manufacturing is completely and highly dependent on the dynamic changes of the global cosmetics market as a whole. A large number of business contracts from legacy beauty brands have been awarded to the cosmetics original equipment manufacturers for the consistent and undisrupted supply of cosmetics products. The changes in consumer preferences and behaviours to highly sustainable and customized cosmetics products and the emergence of independent brands are providing cosmetics original equipment manufacturers greater incentives and motivations for a resource-based nurture, enhancement and assessment of their critical capabilities in order to retain and attract existing and new segment of customers, sustain a superior performance and stay ahead from severe competition. Numerous studies explored the relationships between critical capabilities and organizational performances. Their approach was either following a single-pair or overly general. There is a paucity of study focusing on exploring the association of critical capabilities and organizational performances of original equipment manufacturers, not to say in the context of the cosmetics industry. Hence, this study is motivated to (1) fill the research gap by holistically and comprehensively investigating the critical capabilities of original equipment manufacturers and their organizational performance implications in the context of cosmetics industry; and (2) explore and identify the critical capabilities of cosmetics original equipment manufacturers to provide a deeper understanding and practical insights of their organizational performance implications. The initial constructs and measurement indicators of critical capabilities and organizational performance measures pertinent to original equipment manufacturers in the cosmetics industry were identified through an extensive review of previous and extant literatures from generic and industry-specific (manufacturing and original equipment manufacturing) perspectives. This permitted the generation of the nine initial constructs with 54 corresponding measurement indicators of critical capabilities applicable to original equipment manufacturers in the cosmetics industry and six initial constructs with 36 corresponding measurement indicators of organizational performance measures pertinent to original equipment manufacturers in the cosmetics industry. This study is exploratory in nature and adopted a quantitative approach using structured survey questionnaire to collect data at organization level. Online survey questionnaires were sent to 214 targeted respondent firms, representing the original equipment manufacturers in the cosmetics industry. With the 172 returned and valid responses, data was statistically analyzed by Exploratory Factor Analysis to identify and define the potential critical capabilities and organizational performance measures, followed by Multiple Regression Analysis to examine and predict their corresponding relationships in order to identify the critical capabilities of original equipment manufacturers in the cosmetics industry. The statistical findings revealed six critical capabilities of this study, that are (i) Sustainability Development Capability, (ii) Human Resource Capability, (iii) Leadership Capability, (iv) Knowledge Management Capability, (v) Marketing Capability and (vi) Supply Chain Oriented Capability, which are significantly associated with, in different and corresponding levels and degrees of significance, the five organizational performance measures of this study covering (i) Corporate Social Performance, (ii) Innovation Performance, (iii) Human Resource Performance, (iv) Marketing Performance and (v) Financial Performance. A case study of a leading global cosmetics original equipment manufacturer, Kolmar Korea Co. Ltd., was first conducted to validate and triangulate the empirical results of the identified critical capabilities and their relationships with respective organizational performance measure of original equipment manufacturers in the cosmetics industry. The findings and observations, based on the first case study of Kolmar Korea Co. Ltd., were further compared and benchmarked with the second case study of another renowned cosmetics original equipment manufacturer, namely COSMAX Inc., in which both case studies exhibited consistent findings and observations with the empirical results of this study relating to the critical capabilities of original equipment manufacturers in the cosmetics industry and their organizational performance implications. This study contributes to fill the research gap and enrich the contents of academic studies on critical capabilities and organizational performances, particularly the identification of the critical capabilities of original equipment manufacturers in the cosmetics industry and their associations with organizational performances. Practically, it also provides practical insights and guidelines to the senior executives of cosmetics original equipment manufacturers by highlighting the importance of strategic and deployable choices and practices for developing and enhancing their critical capabilities in pursuit of the most desirable and optimal organizational performances for sustainable survival and expansion in today's dynamic and fast-growing global cosmetics market. |
| Rights: | All rights reserved |
| Access: | restricted access |
Files in This Item:
| File | Description | Size | Format | |
|---|---|---|---|---|
| 5459.pdf | For All Users (off-campus access for PolyU Staff & Students only) | 3.53 MB | Adobe PDF | View/Open |
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