Lean Manufacturing Strategy and Corporate Performance of Selected Pharmaceutical Firms in Southwest Nigeria

This study was conducted to examine the influence of lean manufacturing strategy on the corporate performance of selected pharmaceutical firms in Southwest Nigeria. Before now, the pharmaceutical subsector has been ravaged by challenges of poor inventory management, frequent machine breakdowns that stifled production, and technical know-how that led to waste of resources in the system. Lean manufacturing techniques such as inventory leanness, total productive maintenance, and automation were evaluated to ascertain their effect on the corporate performance of the selected firms. The survey research design was used to carry out this study. The study population was 1,146 employees of four lean-oriented pharmaceutical firms in Southwest Nigeria. Primary data were collected from a sample size of 285 respondents as determined by Krafcik and Morgan’s sampling size technique. Data collected were analysed using Multinomial Logistic Regression (MLR). Findings showed the parameter estimates Wald tests of .891, .883, and .987, indicating the effect of inventory leanness on the corporate performance of the selected firms at significant values of .019, .02 and .004. The results also revealed that total productive maintenance influences corporate performance (operational and market performance) at a p-value of .021, and .0001 accordingly. Moreover, the estimated coefficient Wald tests of .933, .893, and 268 showed a strong positive influence of manufacturing automation on corporate performance at a p-value of .007, .018, and .0001 for operational, financial, and market performance, respectively. The results also indicated significant influence of waste elimination on corporate performance at a p-value of .014, .012, and .0001, respectively. Based on the findings, it was concluded that the lean manufacturing strategy has a positive influence on the corporate performance of the selected pharmaceutical firms in Southwest Nigeria. It was recommended, amongst others, that corporate managers should work tirelessly to minimise every form of non-value addition to the production system.