This study investigates the relationships between three dimensions of competitive priorities (customer focus, product innovation and delivery) and how Asian manufacturers manage and develop their employees and the consequent effect on sustainable manufacturing performance. Three dimensions of manufacturing performance are considered in this study—quality performance, production flexibility and operations cost. This study uses 259 datasets collected from manufacturers in four Asian countries. Structural equation modeling and mediation analysis are performed to test the relationships. Results show that there is a significant positive and mediating relationship between the competitive priority of product innovation, employee management and development, quality performance, production flexibility and operation cost. However, such significant relationships do not exist with competitive priorities of customer focus and delivery. Organizations are constantly faced with the problem of determining which competitive priorities to focus on. However, different competitive priorities have different effects on how the employees are managed and developed, and ultimately, on organizational performance and competitiveness. There is a need to focus on innovation-led strategies that relate to sustainable outcomes. This is one of the first studies in Asia to understand the multilateral relationships between different competitive priorities and different performance dimensions when employee management and development intermediate.
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