A report of information technology in Mexican manufacturing firms
| DOI | https://doi.org/10.1108/02635570010291801 |
| Date | 01 July 2000 |
| Published date | 01 July 2000 |
| Pages | 201-209 |
| Author | Stephen E. Lunce,Stephanie A.M. Smith |
| Subject Matter | Economics,Information & knowledge management,Management science & operations |
A report of information technology in Mexican
manufacturing firms
Stephen E. Lunce
Texas A&M International University, Laredo, Texas, USA
Stephanie A.M. Smith
Texas A&M International University, Laredo, Texas, USA
Introduction
This study focuses on the presence of
Information Technology (IT) in the
maquiladora facilities located in the USA-
Mexico border region. A maquiladora is a
foreign-owned assembly, manufacturing or
processing facility that produces components
primarily for export to firms located in the
USA (Bryan and Gonzalez, 1991; Cohen, 1994).
This paper presents the results of a survey
administered in late 1996 to assess the levels
of sophistication and the pervasiveness of IT
along the border in the Mexican states of Baja
California Norte, Chihuahua, Coahuila,
Nuevo Leon, Sonora and Tamaulipas. The
results provide a starting-point for a
comparison of these types of facilities to
similar plants located in the USA and
Canada. It is anticipated that this
information would be useful to strategic
planners in the preparation of their strategic
plans which could take advantage of
these relatively new multinational
operations.
Research concerning the use of IT in
Mexican firms has been limited (Correa, 1995;
Gemoets, 1989; Lunce and Smith, 1996), and it
is therefore difficult to provide comparative
baselines for investigating the differences in
IT architectures in similar firms in Mexico
and in the other NAFTA signatory countries.
However, it is important to understand that
NAFTA has reduced (or eliminated) many of
the restrictions and impediments that had
previously been encountered by American,
Canadian and/or Mexican companies
attempting to develop multinational
organizations on the North American
continent. It may be hypothesized that as a
result of these earlier restrictions (barriers),
the level of information technology that is
employed by Mexican firms may be
significantly different from the types and
levels of IT employed by US firms. If a firm
seeks to develop integrated operations in
both Mexico and the USA, it is imperative
to ensure the compatibility of its information
processing technologies. This compatibility
issue has not been adequately addressed. As
agreements such as NAFTA have lowered
barriers to entry, the failure to investigate
this incompatibility will compound the
problems of developing truly well-
coordinated international organizations.
Background
Maquiladoras are foreign-owned assembly
plants that manufacture, process or assemble
unfinished products at a lower cost than is
possible in the firm's normal country of
operation. The maquiladora industry was
created by Mexico's 1965 Border
Industrialization Program (BIP) ± which
encouraged foreign (non-Mexican) firms to
invest in manufacturing facilities along the
US-Mexico border via the creation of tax-free
zones (Greenfeld, 1992). Over the years, the
precise definition of a maquiladora has been
obscured; however, perhaps they are best
described as a Mexican corporation that
operates under the maquiladora program as
approved by the Mexican Secretariat of
Commerce. The program is currently
governed by the ``Decree for Development
and Operation of the Maquiladora Industry''
published by the Mexican Federal
government's Diario Oficial on December 22,
1989. This program entitles a company to
foreign investment participation (of up to 100
per cent of the capital invested) and to special
customs treatment (since ordinarily all of the
maquila's products are exported) (Bryan and
Gonzalez, 1991).
The maquiladora industry in Mexico
currently consists of more than 2,200
manufacturing facilities (which employ
approximately 700,000 workers); and is
responsible for approximately $4.74 billion in
value-added production (Cohen, 1994).
Approximately 80 per cent of the
maquiladoras are located along Mexico's
northern border. Originally, the primary
incentive for the creation of such facilities by
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[ 201 ]
Industrial Management &
Data Systems
100/5 [2000] 201±209
#MCB University Press
[ISSN 0263-5577]
Keywords
Information technology, Mexico,
Manufacturing
Abstract
This paper present s the results of a
study that investigates the
sophisticationof the information
technology (IT)employed by
maquiladoras.Themaquiladoras
are Mexican manufa cturing and
assembly plantsthat have been
established by non-Mexican,
primarily US, companies to take
advantage of severaleconomic
factors that sho uld increase the
profitabilityof these non-Mexican
firms. This research is designed to
allow the researchteam to: (1)
develop an understanding of the
technologies foun d in the
maquiladoras,and(2)assistinthe
developmentof an adequate model
of IT architecturesemployed such
that comparisonscan be made of
the architecturesused by
manufacturingfirms located in the
USA, Canada, andMexico (the
signatories of NAFTA, the North
American FreeTrade Agreement).
In general,the results of this survey
indicate the useof significantly
more sophisticated IT than might
otherwise be expected as a result
of the general perception that
maquiladorasshould be organized
to capitalize on therelatively low
skill levels andwages of the hourly
Mexican worker.
This project was funded in
part by a grant from the
Center for the Study of
Western Hemispheric Trade
and in part by the College of
Business Administration and
the Graduate School of
International Trade at Texas
A&M International University.
Student research assistance
was provided by: Echo
Chang, Scott Roberts, Nancy
Morales, Sergio Cano, Ruben
de los Santos, Raul Garza,
Pipe Loic and Elizabeth
Paramo.
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