The moderating effect of Lean supply chain management on the impact of Lean shop floor practices on quality and inventory

The purpose of this paper is to understand the relationship between the implementation of Lean shop floor (LSF) practices and Lean supply chain management, and their effect on quality and inventory turnover.

A survey-based research method was conducted and data were collected from 110 plants located in Brazil. The research constructs were validated through rigorous procedures (unidimensionality and discriminant validity and reliability) through confirmatory factor analysis and two hypotheses were tested using ordinary least square regression.

The results indicate that: Lean supplier relationship positively moderates the effect of LSF practices on inventory turnover; Lean customer relationship negatively moderates the effect of LSF practices on inventory turnover; and Lean supplier relationship positively moderates the effect of LSF practices on quality.

From a theoretical perspective, the results of this study provide evidences supporting the importance of understanding the systemic relationships between Lean implementation at the shop floor and the firm’s relationships with supply chain partners, that was not tested before. As managerial implications, the results suggest that managers should take a decision to foster a Lean supply chain management depending on which performance metrics they need to improve: quality or inventory turnover.