Lean manufacturing performance in Indian manufacturing plants

Manimay Ghosh, Institute of Management Technology, Nagpur, India

Journal of Manufacturing Technology Management Vol. 24 No. 1, 2013 pp. 113-122

http://www.emeraldinsight.com/1741-038X.htm

Introduction and structure of the paper:

Lean manufacturing, often coined as Toyota production system (TPS) in academic literature, started in Toyota Motor Manufacturing Company after the Second World War when most Japanese organizations including Toyota were confronted with the challenge of managing production facilities with limited resources. This challenge motivated Toyota managers to develop various elements of TPS aimed at reducing waste. Thus, lean is about producing the same output with lesser resources (men, material, space, and machinery). Application of lean is not limited to the automotive sector only, but, it has also found acceptance in a wide range of manufacturing industries and is being applied in big as well as small organizations. The purpose of this paper is to examine the current state of lean adoption in Indian manufacturing plants and its impact on operational performance.

This paper is organized with an overview of the relevant literature in the beginning followed by the motivation behind this research and the research methodology. It also deals with the results of the survey and presents a discussion on the research findings and ends with a conclusion.

Research methodology used:

A survey questionnaire was developed and adapted based on work done in US industries. The survey questionnaire was sent to 400 firms in four geographic regions in India. The survey was to measure the current state of lean implementation in Indian manufacturing plants located in the four regions (North, South, East, and West). Stratified sampling was used for the survey, as automotive companies (automobiles and auto ancillaries), the biggest users of lean system, are clustered in the Western, Southern, and Northern regions of India. Additionally, simple random sampling was used for manufacturing companies spanning a wide variety of sectors (e.g. metal products, metal processing and power equipment). The survey was carried out between May and September 2010. The total sample size used for the study was 79.

Seven questions pertaining to seven distinct dimensions of a lean system were used supplier feedback, customer needs, pull system, setup times, total productive maintenance, statistical process control (SPC), and cross-departmental problem solving. Six questions were asked related to operational performance metrics employee productivity, first-pass correct output, cost of conversion, inventory, manufacturing lead time, and space requirement. Additionally, questions related to size of the plant, age of the plant, product type, year of implementation of lean were also asked. 400 firms (small, medium, and big) were contacted by e-mail, and phone from various industries and geographic locations over a five month period. Descriptive statistics (mean and standard deviation) were then calculated for the lean dimensions and the operational metrics used in the study. The statistics were calculated based on five-point Likert scale

Major findings/ results:

The study investigates the degree of lean production implementation in Indian manufacturing plants and its impact on operational metrics. The study also indicates the relationship between lean dimensions/practices and operational outcomes.

Since lean manufacturing is a multi-dimensional construct, the results demonstrate that approximately 80 percent of the respondents have implemented many dimensions of lean focus on customer needs, pull system, setup time reduction, total productive maintenance, supplier performance, statistical process control, and cross-departmental problem solving. The operational metrics have improved on all accounts: high productivity, reduced lead time, improved first-pass correct output, reduced inventory and space requirement. Interestingly, respondents have indicated that first-pass correct output, reduced manufacturing lead time, and increased productivity are the three main drivers of lean implementation. Also, the average number of years lean has been adopted in the sample studied was found to be 7.6 years.

Criticism:

The relevancy and quality of the subject is good and the paper offers researchers a broader and more comprehensive view of lean adoption in Indian manufacturing plants and its impact on operational performance. The findings of this study in terms of improvement in operational metrics seem to be in agreement with the findings of other scholars. However, as the sample size for this study was not large enough, generalizations from this study to the population need to be made with caution.

The Kompass online business directory (in.kompass.com) was used to source contact details of the firms for this study. Additionally, government managed companies were contacted. Hence some new industries not included in the directory may be missing and the data collection may vary. Also the survey was conducted through questionnaires by mail so some respondents might have ignored and may not have filled it seriously entering random answers, which will again vary the data. Use of personal interviews or focus group discussions to collect the data would have been more accurate.

Submitted By:

KEERTHI R

1420347