Proceedings of International Conference on Strategies inVolatile and Uncertain Environment for Emerging MarketsJuly 14-15, 2017Indian Institute of Technology Delhi, New Delhipp.318-326

An Operational Performance of Indian Postal Service using LeanManufacturing Approach – A Conceptual Model

Vadivel S. M1 and A. H. Sequeira2

Abstract

This paper aims to develop a conceptual model to study the lean manufacturing activitiesand its influence of operational performance in Indian postal service. Thorough literaturereview, report analysis and books; the most right lean techniques or tools and theirusefulness have been investigated. There are nine main relevant tools used forimplementing lean service activities such as cellular layout, value stream mapping, kaizenvisual control, kanban, 5S, standardization, cause and effect diagram and single pieceflow. The conceptual model in the postal service is to improve the productivity throughidentification/elimination of waste, improving workplace through 5S and visual control.The critical parameters such as productivity, existing layout problems, workplaceconditions and ambience such as lighting and ventilation are considered. The proposedframework is at conceptual stage. It requires further implementation to be validated.

Keywords: Conceptual model, Lean Manufacturing, Operational performance, Postalservice, Working environment .

1. Introduction

The postal industry comes under Indian public sector managed by central government. It is amajor service oriented industry utilizes the advantage of labour intensive work in India andprovide a better services through integration with other departments such as airways, railwaysand roadways. Everyday postal department receiving more than 40,000 articles which is difficultto store and sorting process unless there is an efficient method. The present postal service isin mysterious situation of falling demand, inflexible workforce, with low morale and lack ofhuman resource management. In present condition, customer to customer mail is on the decline,but business to business and business to customer mail are growing substantially. Insufficientinfrastructure amenities such as logistic management, warehouses prevent them from growingfurther (Ramachandran, 2011).

Postal organizations need to change from the traditional method to nontraditional way toimprove the operational performance through productivity for a long run. In the globalenvironment, price (tangible) is not only important factor but also customer satisfaction

1. Research Scholar, National Institute of Technology Karnataka, School of Management,Surathkal – 575025, IndiaE-mail: ph.dvadivel@gmail.com

2. Professor, National Institute of Technology Karnataka, School of Management,Surathkal - 575025, IndiaE-mail: aloysiushs@gmail.com

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An Operational Performance of Indian Postal Service using Lean Manufacturing Approach –A Conceptual Model

(intangible) is to be reflected to enhance the organizational performance. (Bard et al, 2003).For improving the performance, no need incorporate refined tools advanced technologies tosolve problems. Most of the problems can be solved with low cost and common senseapproaches (Iberahim et al., 2016). Lean manufacturing is one of the techniques to identifyand reduce the non-value added activities (waste) and improve the operational performancethrough employees’ coordination. The lean manufacturing implies continuous improvementthat involved every postal employee both managers and workers require less cost for itsimplementation (Imai, 2007).

India postal is the one of the important service industries, it has wide network of 1,54,939post offices is the huge postal network in the world in the business of providing mail,parcels, logistics, retail and financial services across nation. It plays a significant role insupporting the socio-economic development.In India, up to march 2011 totally postal servicehad 1,54,866 post offices, out of that 1,39,040 were in rural and 15,826 in urban areas(Ramachandran, 2011). In recent years, postal service industry faces many challenges andcompeting with electronic communication through mail process (Lee, 2011). In the postaland mail operations, delivering mails on time is very critical issue. Daily, post offices needsto operate millions of mails to be delivered on time. The postal department fails to deliverthe mails on time because of 7 forms of wastes in terms of excess transportation, inventorymails, over process, over production, waiting, unwanted motions and service defects. Thispaper aims to identify the 7 forms of waste in postal service and increasing the deliveringmails with the implementation of lean manufacturing practices in the long run of sustainableperformance.

This paper is organized as follows: Section 2 is the literature review for this research andfinding the research gap, Section 3 is the research questions, Section 4 is research objectives,Section 5 is discussion of conceptual framework and propositions development, while,remaining section 6, 7 and section 8 has the limitations, conclusions and directions for furtherresearch.

2. Literature Review

To date, Lean manufacturing application not only limited to manufacturing of goods but alsowidely adopted in service operations. Studies on the implementation of lean service notedinteresting trends started in 2005 and increasing cases across service industries such ashealthcare, education, public services, hotel, financial and IT industries etc.

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An Operational Performance of Indian Postal Service using Lean Manufacturing Approach –A Conceptual Model

In previous years, many definitions were made to study the construct and concept of leanmanufacturing/service and its impact of operational performance. Few important literatures reviewedare considered.

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Initially, it is important to find the appropriate tools for implementing lean manufacturing inpostal service and then how lean manufacturing will influence the operational performance. Valuestream mapping (VSM) tool used to identify the existing layout problems and seven types ofwastes; cellular layout tool helps to organize the single piece flow and effectively utilize thematerial and human resources; visual control tool helps the visual information of the entireorganization; 5S tool makes good housekeeping and clean visual workplace; Kaizen tool helpsto improve the process continuously; kanban tool control the inventory system through cardsystem; standardization tool maintains the balanced workflow or procedure to get a desiredoutput rate; single piece flow supports fast production rate and reduce throughput time betweenworkstations; cause and effect diagram tool not only helps to identify (causes) the 7 typeswaste and also identify the its root and eliminate it.

Research Gaps

• Lack of standard models/frameworks in lean manufacturing applications in service industriesarea (Shradha Gupta Monica Sharma Vijaya Sunder M , 2016).

• Very few literature studies focusing on SEM (Structuring Equation Modeling) in leanmanufacturing applications in service industries particularly postal service (author, 2017).

• There is less work done on assessment on lean manufacturing applications in service andits implementation and the performance (V, Suresh, and Aramvalarthan, 2016).

• Developing countries like India servicing large populations with limited resources need processimprovement and methodologies to improve quality service and reduce non value addedactivities. ( Gupta Monica Sharma Vijaya Sunder M, 2016).

3. Research Questions

RQ1: What is the relevance of lean manufacturing in service industries?

RQ2: In which industry in service sector the lean manufacturing exist at present?

RQ3: Why lean initiative steps not taken by Indian postal service?

RQ4: What are the requirements for developing and implementing in Indian postal service?

RQ5: What is the scope for implementing lean manufacturing in Indian postal service?

4. Research Objectives

RO1: To analyze the relevance of lean manufacturing in service industry

RO2: To identify the industry in service sector the lean manufacturing exist at present

RO3: To examine the lean initiative steps not taken by Indian postal service

RO4: To formulate the requirements for developing and implementing in Indian postal service

RO5: To analyze the scope for implementing lean manufacturing in Indian postal service

5. Conceptual Framework and Propositions

Based on the work experience of the researcher and the review of the literature a conceptualframe work has been developed. Today customers’ expected demand is high quality at low costwith variety of product requirements. They require quicker deliveries in batch sizes with reducedlead times. In response to this demands, companies implemented standardization process,kaizen, visual management, cellular manufacturing, and value streaming process. Batch sizeproduction needs additional frequent setups. Hence, single piece flow tool is to facilitate customersquickly with more production units. Nowadays, industries have shifted from mass production to

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batch production as per customer demand. Accordingly, several companies introduced theflexibility and efficiency related with cellular manufacturing to increase the flow speed (Fullerton,2006). Few studies showed that working environment is an important factor for the effectiveadoption of lean in any firms.

Figure 1: A Conceptual Framework Linkage between Lean Practices, WorkingEnvironment and is Effect on Operational Performance

Propositions

P1: Lean practices influence on operational performance

P1a

: Value stream mapping influence on operational performance

P1b

: Kaizen influence on operational performance

P1c

: 5S influence on operational performance

P1d

: Visual control influence on operational performance

P1e

: Standardisation influence on operational performance

P1f: Kanban influence on operational performance

P1g

: Cellular layout influence on operational performance

P1h: Cause and Effect diagram influence on operational performance

P1i: Single piece flow influence on operational performance

P2: Lean practices influence on working environment

P3: There is a positive relationship between working environment and operational performance

P4: Working environment mediates the effect of lean practices on operational performance

environment

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6. Limitations

Lean manufacturing tools or techniques are more to implement in any discrete manufacturingindustries. Here, appropriate tools only applied here. Ex: JIT concept could not be deployed inIndian postal services due to bulk mails (more than 40,000 articles) received per day.

2. Discussion and Conclusion

This study is undertaken to design the conceptual model for lean manufacturing practices inIndian postal service industry. Initially, the factors or determinants that contribute to themeasurement of lean tools have been identified. There are nine right tools that contribute tolean measurement while implementing. This model development limited by considering andselecting the practice/tool/technique that is proposed by the empirical literature survey. Theconceptual model will be further analyzed by a SEM model to measure operational performance.Practitioners and scholars may benefit from this conceptual paper as it will aid to improve theeffectiveness of the operational performance (non-financial measurement) in the postal service.

3. Scope of Future Work

Right now, this conceptual model will be implemented in register mail service (RMS office). Thismodel can be extended to bulk parcel service and speed postal service and it will be diagnosewhich tools contribute more to improve operational activities as well as which tool yield lesscontribution to operational activities. Further, this work can be extended with environmental andfinancial performance to improve organizational performance.

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