Can Lean and Agile organisations within the UK automotive supply chain be distinguished based upon contextual factors?

The purpose of this paper is to robustly establish whether firms are implementing Lean or Agile production in the automotive supply chain (SC) and, by drawing on contingency theory (CT) as our theoretical lens, independently determine whether Lean and Agile firms can be distinguished based upon contextual factors.

Primary quantitative data from 140 firms in the West Midlands (UK) automotive industry were obtained via a constructed survey. Analysis incorporated the use of logistic regressions to calculate the probability of Lean and Agile organisations belonging to different groups amongst the contextual factors investigated.

Lean and Agile firms co-exist in the automotive SC and Lean firms were found to be at higher tiers of the SC, while Agile firms were found to be at lower tiers.

The originality of this study lies within the novel methodological attempt used to distinguish Lean and Agile production, based upon the contextual factors investigated. Not only is the importance of CT theoretically approved, but “received wisdom” within SC management is also contested. Extant literature propagates that the automotive SC is comprised of organisations that predominantly adopt Lean production methods, and that in SCs comprised of both Lean and Agile organisations, the firms closer to the customer will adopt more flexible (Agile) practices, while those that operate upstream will adopt more efficient (Lean) practices. The findings from this study have implications for theory and practice, as Lean and Agile firms can be found in the automotive SC without any relationship to the value-adding process. To speculate as to why the findings contest existing views, resource dependence theory and, more specifically, a power perspective, was invoked. The authors provide readers with a new way of thinking concerning complicated SCs and urge that the discipline of SC management adopts a “fourth” SC model, depicting a new Lean and Agile SC configuration.