Cost awareness as a fundamental prerequisite of advanced manufacturing technology adoption in a supplier–OEM dyad

Purpose The article focuses on the limited cost awareness as a fundamental yet insufficiently understood barrier to advanced manufacturing technology (AMT) adoption and, consequently, enhanced business performance. Design/methodology/approach The article utilizes a longitudinal, interventionist case study (2015–2021) of an AMT-based supplier and its manufacturer customer in Finland. Findings The findings of this article show that decisions not to leverage the advantages offered by AMT may be based on inaccurate financial numbers, indicating limited cost awareness. Thus, considerable cost information asymmetry between an AMT supplier and their customer is problematic and hampers legitimizing AMT adoption decisions. Practical implications Realizing the efficiencies offered by AMTs and their associated services requires a business model transition, which is often justified on economic grounds, particularly through cost savings. However, if cost awareness is inadequate, the business model transition may not be possible and the potential benefits remain unrealized. As a response, the article proposes a framework to analyze and develop the cost awareness of the stakeholders in a customer-supplier dyad. Originality/value As a unique contribution to the AMT literature, the article argues the importance of utilizing truthful and up-to-date cost information to support the adoption of the AMTs and the benefits they potentially entail. The article brings together literature on value creation, AMT and digital servitization in a novel synthesis, paving the way for critical studies on costs in manufacturing technology adoption.