This study aims to accurately identify the strategic management issues regarding the production capacity of Korean manufacturing firms and to conduct research from a manufacturing strategy perspective for creating competitive advantage. In accordance with this objective, the types of manufacturing strategies adopted by Korean manufacturing firms and their competitive capabilities were examined, and the sources of competitive advantage by manufacturing strategy type were empirically analyzed. Most Korean manufacturing firms adopt a price-oriented strategy of supplying low-priced products through cost reduction. However, this price-oriented strategy primarily pursues price competitiveness through labor cost reduction, and is not supported by management rationalization or scientific management methods in production activities. Firms pursuing technological innovation have abandoned existing price competitiveness in favor of product differentiation, but were found to lack competitiveness. Furthermore, sales-oriented firms showed no clear source of competitive advantage, which indicates that Korean manufacturing firms are not only inexperienced in marketing strategy but also lack the integration of production and marketing functions.