Lean production and business performance: international empirical results

Abstract

Purpose

This paper aims to identify factors that considerably impact business performance of lean manufacturers (companies with extensive use of lean tools and excellent operational performance).

Design/methodology/approach

IMSS IV (International Manufacturing Strategy Survey) data bank is used for statistical analysis. It contains 711 valid observations from 23 countries from the time period between 2005 February and 2006 March. Out of the 711 responding organization data of 453 firms are analyzed. Quantitative analyses are done by cluster, ANOVA, and regression analyses.

Findings

Many factors influencing business performance of lean producers are outside of the scope of Operations Management (e.g. market dynamics, new entrants, and customization). Production's contribution to business performance is limited to product/service positioning, supplier and capacity management.

Research limitations/implications

The most important limitation is that the database used in the study was created for more general purposes. Although our results do not show any difference among industries, we only consider cultural impact at regional level. The explanatory power of our model reveals that we could have overlooked many important factors (e.g. innovation capability of business unit, firm role in the supply chain), so further research (e.g. review of strategic management literature) is required to enhance the reliability of variables.

Originality/value

Empirical results regarding improvements in business performance of lean companies are ambiguous. The study highlights key areas of lean production that contribute to superior business performance. It will help managers to explore both operational and business benefits of lean implementation.

Citation

Losonci, D. and Demeter, K. (2013), "Lean production and business performance: international empirical results", Competitiveness Review, Vol. 23 No. 3, pp. 218-233. https://doi.org/10.1108/10595421311319816