Operations capabilities provide the fundamental basis of competitive advantage for manufacturing firms. Thus, it is crucial for managers as well as researchers to understand the importance of operations capabilities within the respective market environment. This thesis evaluates the most important operations capability dimensions as well as operations capabilities for competitive manufacturing in a high-cost environment and how they differ based on manufacturing firm characteristics. Therefore, a quantitative survey was conducted within the high-cost environments Sweden and Germany. Empirical findings show that quality is the order-winning criterion in high-cost environments, followed by delivery, cost and flexibility. However, the importance highly differs across the various manufacturing firm characteristics. Managers of manufacturing firms in high-cost environments can use these findings to validate and adjust their operations strategy to achieve a competitive advantage.