IDEAS home Printed from https://ideas.repec.org/a/spr/annopr/v241y2016i1d10.1007_s10479-012-1177-3.html
   My bibliography  Save this article

Lean principles, practices, and impacts: a study on small and medium-sized enterprises (SMEs)

Author

Listed:
  • Bin Zhou

    (University of Houston-Downtown)

Abstract

Lean as a business strategy is used to improve quality and service, eliminate waste, reduce time and costs, and enhance overall organizational effectiveness. Heightening challenges in competition in recent years have prompted many small and medium-sized enterprises (SMEs) to adopt lean to enhance firms’ competitiveness. This paper attempts to present an all-inclusive study and it examines various factors associated with the implementation of lean in SMEs in the U.S. The findings suggest that most of SMEs have a relatively accurate understanding of lean concept and philosophy. The primary reasons to implement lean are mainly internal, including reduce cost, improve profit margin, improve utilization of plant/facility, and maintain competitive position. A hierarchical cluster analysis was conducted to investigate lean status. It was discovered that both advanced adopters and beginners of lean are discovered. ANOVA test results show that there exist quite significant differences in terms of the degrees of lean implementation in SMEs. Varied lean tools and programs have been applied and they are positively related with firms’ performance. Lastly, the paper provides evidences that major lean barriers are encountered by SMEs regarding management or people related factors as well as key knowledge and know-how.

Suggested Citation

  • Bin Zhou, 2016. "Lean principles, practices, and impacts: a study on small and medium-sized enterprises (SMEs)," Annals of Operations Research, Springer, vol. 241(1), pages 457-474, June.
    • Handle: RePEc:spr:annopr:v:241:y:2016:i:1:d:10.1007_s10479-012-1177-3
    DOI: 10.1007/s10479-012-1177-3
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10479-012-1177-3
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10479-012-1177-3?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Panizzolo, Roberto, 1998. "Applying the lessons learned from 27 lean manufacturers.: The relevance of relationships management," International Journal of Production Economics, Elsevier, vol. 55(3), pages 223-240, August.
    2. Zhou, Bin & Zhao, Yao & Katehakis, Michael N., 2007. "Effective control policies for stochastic inventory systems with a minimum order quantity and linear costs," International Journal of Production Economics, Elsevier, vol. 106(2), pages 523-531, April.
    3. Sharp, J. M. & Irani, Z. & Desai, S., 1999. "Working towards agile manufacturing in the UK industry," International Journal of Production Economics, Elsevier, vol. 62(1-2), pages 155-169, May.
    4. Zhou, Bin & Katehakis, Michael N. & Zhao, Yao, 2009. "Managing stochastic inventory systems with free shipping option," European Journal of Operational Research, Elsevier, vol. 196(1), pages 186-197, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sunder M, Vijaya & Ganesh, L.S., 2021. "Lean additives in a service factory: A design science approach," Technovation, Elsevier, vol. 104(C).
    2. Sun, Jingchao & Na, Hongming & Yan, Tianyi & Che, Zichang & Qiu, Ziyang & Yuan, Yuxing & Li, Yingnan & Du, Tao & Song, Yanli & Fang, Xin, 2022. "Cost-benefit assessment of manufacturing system using comprehensive value flow analysis," Applied Energy, Elsevier, vol. 310(C).
    3. Song Xu & Reena Nupur & Devika Kannan & Rashi Sharma & Pallavi Sharma & Sushil Kumar & P. C. Jha & Chunguang Bai, 2023. "An integrated fuzzy MCDM approach for manufacturing process improvement in MSMEs," Annals of Operations Research, Springer, vol. 322(2), pages 1037-1073, March.
    4. Vadivel Sengazhani Murugesan & Sunil Kumar Jauhar & Aloysius Henry Sequeira, 2022. "Applying simulation in lean service to enhance the operational system in Indian postal service industry," Annals of Operations Research, Springer, vol. 315(2), pages 993-1017, August.
    5. Fabiane Letícia Lizarelli & Jiju Antony & José Carlos Toledo, 2020. "Statistical thinking and its impact on operational performance in manufacturing companies: an empirical study," Annals of Operations Research, Springer, vol. 295(2), pages 923-950, December.
    6. Oluwaseun Niyi Anifowose & Matina Ghasemi & Banji Rildwan Olaleye, 2022. "Total Quality Management and Small and Medium-Sized Enterprises’ (SMEs) Performance: Mediating Role of Innovation Speed," Sustainability, MDPI, vol. 14(14), pages 1-19, July.
    7. Catherine Maware & David M. Parsley, 2022. "The Challenges of Lean Transformation and Implementation in the Manufacturing Sector," Sustainability, MDPI, vol. 14(10), pages 1-24, May.
    8. Anshu Gupta & Pallavi Sharma & Akansha Jain & Hongbo Xue & S. C. Malik & P. C. Jha, 2023. "An integrated DEMATEL Six Sigma hybrid framework for manufacturing process improvement," Annals of Operations Research, Springer, vol. 322(2), pages 713-753, March.
    9. Pimchanok Panthai & Kanokporn Kungwalsong, 2024. "Resource Efficiency and Environmental Impact Assessment Method for Small-Scale Producers: A Case Study of Pond and In-Pond Raceway System Production for Growing Nile Tilapia," Sustainability, MDPI, vol. 16(3), pages 1-23, February.
    10. Malesios, Chrisovalantis & De, Debashree & Moursellas, Andreas & Dey, Prasanta Kumar & Evangelinos, Konstantinos, 2021. "Sustainability performance analysis of small and medium sized enterprises: Criteria, methods and framework," Socio-Economic Planning Sciences, Elsevier, vol. 75(C).
    11. Luis Enrique Valdez-Juárez & Dolores Gallardo-Vázquez & Elva Alicia Ramos-Escobar, 2018. "CSR and the Supply Chain: Effects on the Results of SMEs," Sustainability, MDPI, vol. 10(7), pages 1-27, July.
    12. Alkhoraif, Abdullah & Rashid, Hamad & McLaughlin, Patrick, 2019. "Lean implementation in small and medium enterprises: Literature review," Operations Research Perspectives, Elsevier, vol. 6(C).
    13. De, Debashree & Chowdhury, Soumyadeb & Dey, Prasanta Kumar & Ghosh, Sadhan Kumar, 2020. "Impact of Lean and Sustainability Oriented Innovation on Sustainability Performance of Small and Medium Sized Enterprises: A Data Envelopment Analysis-based framework," International Journal of Production Economics, Elsevier, vol. 219(C), pages 416-430.
    14. Mariano Jiménez & Luis Romero & Jon Fernández & María del Mar Espinosa & Manuel Domínguez, 2019. "Extension of the Lean 5S Methodology to 6S with An Additional Layer to Ensure Occupational Safety and Health Levels," Sustainability, MDPI, vol. 11(14), pages 1-18, July.
    15. Hariyani, Dharmendra & Mishra, Sanjeev & Hariyani, Poonam & Sharma, Milind Kumar, 2023. "Drivers and motives for sustainable manufacturing system," Innovation and Green Development, Elsevier, vol. 2(1).
    16. Parast, Mahour Mellat & Safari, Arsalan, 2022. "Enhancing the quality and competitiveness of small businesses: A pooled cross-sectional analysis," International Journal of Production Economics, Elsevier, vol. 246(C).
    17. Francisco C. Marques & Fernando A. F. Ferreira & Constantin Zopounidis & Audrius Banaitis, 2022. "A system dynamics-based approach to determinants of family business growth," Annals of Operations Research, Springer, vol. 311(2), pages 799-819, April.
    18. Vicky Ching Gu & Bin Zhou & Qing Cao & Jeffery Adams, 2021. "Exploring the relationship between supplier development, big data analytics capability, and firm performance," Annals of Operations Research, Springer, vol. 302(1), pages 151-172, July.
    19. Pearce, Antony & Pons, Dirk & Neitzert, Thomas, 2018. "Implementing lean—Outcomes from SME case studies," Operations Research Perspectives, Elsevier, vol. 5(C), pages 94-104.
    20. María Jesús Ávila-Gutiérrez & Alejandro Martín-Gómez & Francisco Aguayo-González & Juan Ramón Lama-Ruiz, 2020. "Eco-Holonic 4.0 Circular Business Model to Conceptualize Sustainable Value Chain towards Digital Transition," Sustainability, MDPI, vol. 12(5), pages 1-32, March.
    21. Jozefine Nybom & Erik Hunter & Eric Micheels & Martin Melin, 2021. "Farmers’ strategic responses to competitive intensity and the impact on perceived performance," SN Business & Economics, Springer, vol. 1(6), pages 1-22, June.
    22. Malesios, Chrisovalantis & De, Debashree & Moursellas, Andreas & Dey, Prasanta & Evangelinos, Konstantinos, 2019. "Review of Statistical Modeling Approaches for Sustainability Analysis of Small and Medium sized Enterprises," MPRA Paper 93028, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Becerril-Arreola, Rafael & Leng, Mingming & Parlar, Mahmut, 2013. "Online retailers’ promotional pricing, free-shipping threshold, and inventory decisions: A simulation-based analysis," European Journal of Operational Research, Elsevier, vol. 230(2), pages 272-283.
    2. Noblesse, Ann M. & Boute, Robert N. & Lambrecht, Marc R. & Van Houdt, Benny, 2014. "Characterizing order processes of continuous review (s,S) and (r,nQ) policies," European Journal of Operational Research, Elsevier, vol. 236(2), pages 534-547.
    3. Evrim Ursavas, 2022. "Priority control of berth allocation problem in container terminals," Annals of Operations Research, Springer, vol. 317(2), pages 805-824, October.
    4. Zhu, Han & Liu, Xing & Chen, Youhua (Frank), 2015. "Effective inventory control policies with a minimum order quantity and batch ordering," International Journal of Production Economics, Elsevier, vol. 168(C), pages 21-30.
    5. Hayya, Jack C. & Harrison, Terry P. & He, X. James, 2011. "The impact of stochastic lead time reduction on inventory cost under order crossover," European Journal of Operational Research, Elsevier, vol. 211(2), pages 274-281, June.
    6. Mou, Shandong & Robb, David J. & DeHoratius, Nicole, 2018. "Retail store operations: Literature review and research directions," European Journal of Operational Research, Elsevier, vol. 265(2), pages 399-422.
    7. Paula Ramona Rachisan & Adrian Grosanu & Sorin Romulus Berinde, 2012. "PARTICULARITIES OF ACCOUNTING FOR SHARE-BASED PAYMENT WITHIN ROMANIAN SMEs," JOURNAL STUDIA UNIVERSITATIS BABES-BOLYAI NEGOTIA, Babes-Bolyai University, Faculty of Business.
    8. Qing-chun Meng & Xiao-le Wan & Xiao-xia Rong, 2015. "A Robust Ordering Strategy for Retailers Facing a Free Shipping Option," PLOS ONE, Public Library of Science, vol. 10(5), pages 1-14, May.
    9. Shao, Xiao-Feng, 2017. "Free or calculated shipping: Impact of delivery cost on supply chains moving to online retailing," International Journal of Production Economics, Elsevier, vol. 191(C), pages 267-277.
    10. Perera, Sandun & Janakiraman, Ganesh & Niu, Shun-Chen, 2017. "Optimality of (s, S) policies in EOQ models with general cost structures," International Journal of Production Economics, Elsevier, vol. 187(C), pages 216-228.
    11. Bortolotti, Thomas & Romano, Pietro & Martínez-Jurado, Pedro José & Moyano-Fuentes, José, 2016. "Towards a theory for lean implementation in supply networks," International Journal of Production Economics, Elsevier, vol. 175(C), pages 182-196.
    12. Lin, Ching-Torng & Chiu, Hero & Chu, Po-Young, 2006. "Agility index in the supply chain," International Journal of Production Economics, Elsevier, vol. 100(2), pages 285-299, April.
    13. Michal Medonos & Marie Jurová, 2016. "Implementing Lean Production - Application of Little's Law," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 64(3), pages 1013-1019.
    14. Han Zhu, 2022. "A simple heuristic policy for stochastic inventory systems with both minimum and maximum order quantity requirements," Annals of Operations Research, Springer, vol. 309(1), pages 347-363, February.
    15. Wang, Xun & Disney, Stephen M. & Ponte, Borja, 2023. "On the stationary stochastic response of an order-constrained inventory system," European Journal of Operational Research, Elsevier, vol. 304(2), pages 543-557.
    16. Dowlatshahi, Shad & Cao, Qing, 2006. "The relationships among virtual enterprise, information technology, and business performance in agile manufacturing: An industry perspective," European Journal of Operational Research, Elsevier, vol. 174(2), pages 835-860, October.
    17. Anna-Theresa Walter, 2021. "Organizational agility: ill-defined and somewhat confusing? A systematic literature review and conceptualization," Management Review Quarterly, Springer, vol. 71(2), pages 343-391, April.
    18. Kartikeya Puranam & David C. Novak & Marilyn Lucas, 2022. "Extending the newsvendor model to account for uncontrolled inventory transfers," Annals of Operations Research, Springer, vol. 317(1), pages 213-226, October.
    19. Samir Abdulnour & Chantal Baril & Georges Abdulnour & Sébastien Gamache, 2022. "Implementation of Industry 4.0 Principles and Tools: Simulation and Case Study in a Manufacturing SME," Sustainability, MDPI, vol. 14(10), pages 1-20, May.
    20. Huaxiao Shen & Tian Tian & Han Zhu, 2019. "A Two-Echelon Inventory System with a Minimum Order Quantity Requirement," Sustainability, MDPI, vol. 11(18), pages 1-22, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:annopr:v:241:y:2016:i:1:d:10.1007_s10479-012-1177-3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.