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Scope for lean implementation: A survey of 127 Indian industries

Article  in  International Journal of Rapid Manufacturing · January 2010


DOI: 10.1504/IJRAPIDM.2010.034253

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Int. J. Rapid Manufacturing, Vol. 1, No. 3, 2010 323

Scope for lean implementation: a survey of


127 Indian industries

Bhim Singh*
Department of Mechanical Engineering,
Galgotias College of Engineering and Technology,
1-Knowledge park – 2, Greater Noida – 201306, UP, India
E-mail: bhimsingh_ncce@rediffmail.com
*Corresponding author

S.K. Garg
Department of Mechanical and Production Engineering,
Delhi Technological University,
Delhi – 110042, India
E-mail: skgarg63@yahoo.co.in

S.K. Sharma
Department of Mechanical Engineering,
National Institute of Technology (NIT),
Kurukshetar – 136119, Haryana, India
E-mail: sksharma49nitk@yahoo.com

Abstract: Lean manufacturing is a plethora of principles that focus on cost


reduction by identifying and eliminating non-value added activities. Indian
industry is still struggling to implement lean principles and philosophies.
Through this paper, an attempt has been made to identify the scope for lean
implementation in Indian industry which forces the Indian industry to adopt
lean manufacturing initiatives. A questionnaire is prepared after identifying
26 issues of lean implementation with discussion to industrial personals and
sent to 300 Indian industries. The responses of 127 industries were received
on a five-point scale ranging from very low to very high. By applying
factor analysis, 26 lean issues were reduced in to five broad categories, i.e.,
customers issues, organisational issues, supplier issues, market issues and
top management issues. Further descriptive statistics was used to find the
importance of lean issues to Indian industry.

Keywords: lean manufacturing; lean implementation issues; factor analysis;


Indian industry; survey; India.

Reference to this paper should be made as follows: Singh, B., Garg, S.K. and
Sharma, S.K. (2010) ‘Scope for lean implementation: a survey of 127 Indian
industries’, Int. J. Rapid Manufacturing, Vol. 1, No. 3, pp.323–333.

Biographical notes: Bhim Singh is presently associated with Galgotia’s


College of Engineering and Technology, Greater Noida, UP, India, as an
Assistant Professor in the Mechanical Engineering Department. He received his
BTech from REC Kurukshetra and MTech from GNDEC, Ludhiana. He is

Copyright © 2010 Inderscience Enterprises Ltd.


324 B. Singh et al.

presently pursuing PhD from NIT Kurukshetra on lean manufacturing. He has


more than ten years of teaching experience in undergraduate and postgraduate
classes. He has published paper in international journal and in several national
and international conferences. He has guided many projects to undergraduate
students. His area of interest – statistical quality control, operations research,
supply chain management, value engineering and lean manufacturing.

S.K. Garg did his PhD from IIT Delhi, India. He is presently associated
with the Mechanical and Industrial Engineering Department of Delhi Technical
University, Delhi, as Professor of Industrial Engineering and Operations
Research. He has published more than 50 papers in international journals and
conferences. He also authored three books in his area of interest. His area of
interest includes lean manufacturing, supply chain management, just in time
manufacturing, total quality management and operation research. He is also
guiding many research scholars for their PhD degree in his field.

S.K. Sharma is currently a Professor in the Department of Mechanical


Engineering at the National Institute of Technology, Kurukshetra, Haryana,
India. He did extensive research in the field of industrial engineering and
has guided 16 candidates in their dissertation for MTech degree. He is guiding
ten students for their PhD degree in the field of production and industrial
engineering. He has published many papers in national and international
journals of repute.

1 Introduction

In spite of the numerous benefits offered by lean manufacturing to today’s industrial


world, the irony is that it is obvious that many manufacturers have yet to grasp the full
benefits of this philosophy. In particular, the focus at many Indian industries which are
still working on Henry Fords mass production principles or continued to be driven by an
in-trenched and outdated batch and queue mentality. However, there are those who have
been faster to catch on to the lean manufacturing notion and now accept it as a key part
of their strategy for long-term manufacturing survival with the focus on eliminating
waste from the present system and concentrating their efforts on adding more value to
the end product by reducing lead times, reducing inventory and improving overall
communication. Lean manufacturing focuses on eliminating waste and non-value adding
activities and waste can be overproduction, defects, unnecessary inventory, inadequate
processing, excessive transportation, waiting and unnecessary motion (Womack et al.,
1990). Lean manufacturing as a multidimensional approach that encompasses a
wide variety of management practices, including just-in-time, total quality management
(TQM), work teams, cellular manufacturing, suppliers involvement, etc., in an integrated
system. The main thrust of lean production (LP) is that these practices can work
synergistically to create a systematised, high quality system that fulfils the demands of
the customers at the required pace (Shah and Ward, 2003). But, the implementation of
lean management to any industry in not a simple task and lean manufacturing philosophy
is designed for a smooth demand. That is why, many Indian industries are still unable to
take full advantages of lean benefits. To motivate the Indian industry towards lean
implementation, some lean implementation issues required to be identified and discussed
Scope for lean implementation 325

in context to Indian conditions. In this paper, a list of 26 lean implementation issues is


identified from the literature followed by discussion to industrial personals. These
26 identified issues are reduced in to five categories, i.e., customers issues, organisational
issues, supplier issues, market issues and top management issues with the help of factor
analysis. List of these identified implementation issues are shown in Table 1. Further
descriptive statistics was used to explain importance of the lean implementation issues to
Indian industry.
Table 1 Lean implementation issues in Indian environment

Customers issues
• To reduce response time
• To deliver in small lots
• To implement self-certification
• To reduce rejection
• To increase range of products
Organisational issues
• Frequent breakdown
• High inventory
• High rejection rate
• Underutilisation of capacity
• Workers absenteeism
• Obsolete technology
• High setup time/changeover time
Supplier issues
• Unreliable transport
• Frequent changes in supply schedule
• Poor communication system
• Poor vendor response
• Frequent design changes
• High lead time
Market issues
• Stiff competition
• Low sales revenue
• Poor brand image
Top management issues
• Lack of funds
• Lack of multiskilled manpower
• Lack of quality consciousness
• Lack of support from top management
326 B. Singh et al.

2 Literature review on lean implementation

Publication of the book The Machine that Changed the World attracted attention of
researchers towards lean manufacturing (Womack et al., 1990). Taj and Berro (2006)
demonstrated how lean manufacturing and constraint management could work together to
improve productivity, efficiency and quality. Motwani (2003) discussed, with the help of
case study, the most important elements of lean manufacturing and the strategies used by
the company for lean implementation by utilising business process framework. Domingo
et al. (2007) concluded that the combination of milk run and value stream mapping
(VSM) is an important tool for increasing routing flexibility and process improvement of
any industry. Lasa et al. (2008) showed that the VSM is a valuable tool for redesigning
the productive systems according to the lean system. Seth et al. (2008) addressed the
various wastes in the processing side of the supply chain of the Indian cottonseed oil
industry, using VSM as an approach and wastes are then individually attacked to reduce
or eliminate them from the system. Bayou and Korvin (2008) compared the leanness of
GM and Ford production system and found Ford’s system is more than 17% leaner than
GM’s system over the three-year period. Rathje et al. (2009) described in detail two lean
implementation projects within the same company and highlighted a number of lessons
learned, all of which may help other organisations ensure the success of their own
lean implementation and improvement efforts. Browning and Heath (2009) developed a
revised framework that reconceptualises the effect of lean on production costs and use it
to develop propositions to direct further research and also developed a fuller range of the
effects of lean practices on production costs and illuminate how operations managers
might control key variables to draw greater benefits from lean implementation. Matt
(2008) designed ten ‘easy-to-use’ steps for the systematic design of LP systems. Saurin
and Ferreira (2009) presented guidelines for assessing LP impacts on working conditions
either at a plant or departmental level, which were tested on a harvester assembly line in
Brazil. Doolen et al. (2008) carried out field study of two Kaizen events held within a
single organisation utilising both quantitative (survey) and qualitative (interviews) and
demonstrated that initial success in business outcomes and human resource outcomes are
not necessarily correlated and that success may vary over time. Leaders need to pay close
attention to follow-up mechanisms to ensure sustainability. Krishnamurthy and Yauch
(2007) described that manufacturing corporations might find the infrastructure to be a
beneficial way to structure their own organisations in order to capitalise on the benefits
of both the lean and agile manufacturing strategies. Buzby et al. (2002) showed the
applications of lean manufacturing principles to administrate the function of the
quotations process and demonstrated that the electronic solutions are the best remedies
for streamlining the quotations process to reduce the total cycle time. Mistry (2005)
revealed how specific quality enhancing and lean manufacturing components evolved
over a period of seven years in a two stage transition from a ‘lean’ supply chain to one
that represented an integrated lean and agile paradigm based on the decoupling point
approach. Barla (2003) presented a multi-attribute selection model (MSM) in five basic
steps for evaluation and selection of suppliers on lean philosophy. John (2009) conducted
a case study of a small furniture company that achieved 30% increase in productivity
by implementing a new scheduling system that assisted implementation of lean
manufacturing. Kennedy and Widener (2008) developed a theoretical framework
that assists in understanding the control choices, accounting practices and organisational
Scope for lean implementation 327

structure associated with lean manufacturing. Bruuna and Meffordb (2004) discussed
many reasons why the internet can facilitate the movement to LP systems and a few firms
have made tentative efforts in that direction. Arbos (2002) proposed a methodology for
the implementation of lean management in a services production system, as applied to the
case of telecommunication services. In addition, since services are subject to a much
greater degree of variability of features than industrial production, this work included an
analysis of that variability and a proposal for action to be taken when it is excessive.
Singh and Sharma (2009) discussed application of lean tools with the help of an Indian
case study and noted considerable improvement in lead time, cycle time, inventory
reduction and productivity improvement. Singh et al. (2009) discussed the importance of
lean practices for the industries during recessionary times. Worley and Doolen (2006)
identified management support and communications as important variables in a lean
manufacturing implementation. Furthermore, evidenced that these variables are critical in
not only the implementation of lean manufacturing practices and principles, but also in
the ongoing planning and deployment efforts of organisational leader.

3 Need for this study

After having gone through the literature and discussing the lean implementation issues
with the industrial personal, it has been observed that lean philosophy has many benefits
to offer for the Indian industry, but present status of lean is not up to the mark in the
Indian industry and needs attention of researchers and managers for improvements.
Secondly, a very few research have been made on lean implementation in Indian
conditions, this fact is well-disclosed by a cursory search on the internet using a versatile
search engine, i.e., http://www.google.com with keywords such as LP, lean philosophy,
lean manufacturing, Toyota production system, just in time production, just in time
manufacturing and world class manufacturing. Table 2 shows the result of this cursory
search that web pages from India are less than 1% of the total web pages.
Table 2 Outcome of internet search

Results (no. of web pages ) as on 24 October 2009


Sr. no. Keyword used (India/total) web
From the web From India
pages %
1 LP 11,800,000 33,300 0.281409243
2 Lean philosophy 531,000 13,700 2.515145952
3 Lean manufacturing 2,530,000 40,400 1.571739807
4 Toyota production system 922,000 30,100 3.161432623
5 Just in time production 111,000,000 355,000 0.318800233
6 Just in time manufacturing 372,000,000 1,770,000 0.473553255
7 World class manufacturing 124,000,000 1,440,000 1.147959184
Total 622,783,000 3,682,500 0.59129745
Source: http://www. google.com
328 B. Singh et al.

4 Present work

The lean implementation issues are identified in discussion to industry personal and
importance of these issues to the industry is justified with the help of a survey of Indian
industry. Brief methodology of work done in this paper is given below:
• identification of lean implementation issues in consultation to industrial personal and
preparation of questionnaire
• pilot study for checking construct validity and reliability of questionnaire
• questionnaire mailed to 300 Indian industries and only 127 valid responses are
received
• applied factor analysis using SPSS for grouping of lean implementation issues
• descriptive statistic for analysis using SPSS
• results and discussion.

4.1 Target population


Industries selected for this survey were three types of industries, i.e., manufacturing
industry, machine tool industry and automobile industry all over the country. 300
questionnaires were sent to all three types of selected industries in equal number and a
total of 127 responses were received, i.e., 42.33%. Numbers of responses received from
individual industries is shown in Table 3.
Table 3 Responses received according to type of industry

Type of industry Total Percentage


Manufacturing 51 40
Machine tools 39 31
Automobile industry 37 29
Total 127 100

4.2 Grouping of lean implementation issues using factor analysis


A factor analysis was performed to verify groupings of lean implementation issues from
the survey data. Factors were extracted using the maximum likelihood method, followed
by a varimax rotation. The Kaiser criterion (eigenvalues > 1) was employed in
conjunction with an evaluation of scree plots. Both the scree test and initial eigenvalue
test suggested the presence of five significant factors for lean implementation issues that
were retained for rotation. This factor analysis empirically grouped the scale items of lean
implementation issues as given in Table 4. The five factors explain 81.3% of the inherent
variance in their items. The grouped lean implementation issues are given in Table 1 and
labelled as customers issues, organisational issues, supplier issues, market issues and top
management issues.
Scope for lean implementation 329

Table 4 Rotated factor matrix on lean implementation issues

Factors
S.N. Lean implementation issues
1 2 3 4 5
1 Frequent breakdown 0.211 0.758 0.053 –0.047 0.145
2 High inventory 0.043 0.880 0.136 –0.034 0.018
3 High lead time 0.136 0.005 0.812 –0.060 –0.066
4 High rejection rate 0.001 0.835 –0.051 –0.311 0.043
5 High setup time/changeover time 0.167 0.807 0.027 0.022 0.200
6 Lack of funds 0.297 0.452 –0.093 –0.045 0.704
7 Lack of multiskilled manpower 0.372 0.205 –0.054 0.197 0.753
8 Lack of quality consciousness 0.423 0.279 0.134 0.138 0.760
9 Lack of support from top management 0.131 0.127 –0.010 –0.038 0.702
10 Low sales revenue 0.286 0.327 0.037 0.892 0.383
11 Obsolete technology 0.285 0.803 –0.007 0.070 0.499
12 Poor brand image 0.333 0.135 –0.026 0.898 0.335
13 Poor communication system 0.446 0.347 0.766 –0.034 0.340
14 Poor vendor response 0.192 0.163 0.781 0.047 0.176
15 Underutilisation of capacity 0.381 0.726 –0.081 0.133 0.091
16 Unreliable transport 0.230 0.156 0.712 –0.043 0.183
17 Workers absenteeism 0.382 0.706 0.051 0.041 0.079
18 Frequent changes in supply schedule 0.017 –0.052 0.708 –0.033 –0.009
19 Frequent design changes 0.005 0.039 0.709 –0.097 0.035
20 To reduce response time 0.889 –0.037 0.286 0.001 0.011
21 To deliver in small lots 0.812 0.037 0.348 0.282 –0.052
22 To implement self-certification 0.898 0.096 0.208 0.345 –0.250
23 Stiff competition 0.201 0.001 0.097 0.733 –0.195
24 To increase range of products 0.712 –0.043 –0.054 0.306 –0.060
25 To reduce cost 0.731 0.069 0.000 0.261 0.361
26 To reduce delivery time 0.752 –0.082 –0.015 0.156 0.202
Notes: Extraction method: principal component analysis; rotation method: varimax with
Kaiser normalisation; rotation conversed in ten iterations
330 B. Singh et al.

4.3 Descriptive statistic of lean implementation issues


Further analysis confirms the reliability of these five factors with Cronbach’s alpha of
0.85, 0.82, 0.79, 0.75 and 0.81 respectively. The mean and standard deviation of all the
implementation issues were calculated and given in Table 5.
Table 5 Descriptive analysis for lean implementation issues

Lean implementation issues Mean Std. deviation N


Frequent breakdown 2.9286 0.95648 127
High inventory 3.8267 0.92362 127
High lead time 3.6619 1.00740 127
High rejection rate 3.2540 0.79936 127
High setup time/changeover time 3.6746 0.90181 127
Lack of funds 2.3905 0.84346 127
Lack of multiskilled manpower 2.7381 0.88705 127
Lack of quality consciousness 2.7619 0.88026 127
Lack of support from top management 3.5635 0.96744 127
Low sales revenue 3.6667 0.84853 127
Obsolete technology 2.8746 0.91939 127
Poor brand image 3.5397 0.90023 127
Poor communication system 3.5794 0.84241 127
Poor vendor response 3.7008 0.89726 127
Underutilisation of capacity 2.6825 0.90907 127
Unreliable transport 3.1397 0.85464 127
Workers absenteeism 2.6270 0.80731 127
Frequent changes in supply schedule 3.1714 0.73950 127
Frequent design changes 3.2159 0.70409 127
To reduce response time 3.6952 0.65027 127
To deliver in small lots 3.5492 0.71630 127
To implement self-certification 3.6587 0.75007 127
Stiff competition 4.2889 0.73997 127
To increase range of products 3.5159 0.71536 127
To reduce cost 3.8889 0.66900 127
To reduce delivery time 3.6143 0.68827 127
Notes: Five-point scale ranging very low to very high (1 – very low, 2 – low,
3 – medium, 4 – high and 5 – very high)

5 Result and discussion

Grouping of lean implementation issues using factor analysis is shown in Table 4. This
grouping is very practical and confirms with the status of the issues in the industries.
Further descriptive statistics for status of lean implementation issues in Indian industries
is presented in Table 5. The data indicate that market issue is most important in the
Scope for lean implementation 331

Indian conditions as mean of all its sub-issues is greater than 3.5; for ‘stiff competition’,
it is 4.20; customers issues is the next important factor of lean implementation as mean of
all sub-issues under this head is 351 to 3.88; suppliers issues is also an important factor
with mean 3.1 to 3.7; organisation as a lean implementation issues also received
considerable weight-age and mean of its all sub-issues varies from 2.87 to 3.83; and top
management issues received less importance as compared to other issues, its mean varies
from 2.4 to 2.9. Lean implementation issues as per decreasing order of their importance
to Indian industry are given in Table 6.
Table 6 Lean implementation issues as per importance in Indian industry

Top
Market Customer Supplier Organisational
Lean issues management
issues issues issues issues
issues
Total mean 3.84 3.65 3.63 3.12 2.86
Rank 1 2 3 4 5

6 Conclusions

Through this research, lean implementation issues are identified and ranked according to
their usage in the Indian industry. Market pressure appeared as very dominating issue
which indicate that there are sufficient player in the Indian market in all three fields, i.e.,
(automobile, manufacturing and machine tool) and Indian industry is feeling the heat
of competition which motivate industry towards lean initiatives. Second main issue for
lean came out of this study is customers issues, which is very true as per the definition of
lean the end customer is the main pull for every lean activity (Womack et al., 1990).
Customers issue is the driving force for the Indian industry for lean implementation.
Supplier issues is also received good importance in Indian environment and discloses the
fact that development of suppliers and communication with the suppliers is not up to
the mark in the Indian industries and Indian industries are required to work on vendor
development for creating reliable source of supply. Organisational issues is the next in
the series and received considerable importance in the Indian industries which indicate
that Indian industries still have lot of scope for improvement and industries need to
recognise the importance of lean implementation and need to change their organisational
structure according to the requirement of lean philosophy.
Top management issues for lean implementation is also very important and top
management policies and attitude towards lean implementation need some improvement
in Indian industries. As very less research has been found on lean implementation
in Indian context in the extant literature, so, this paper will be very beneficial for the
researchers and practitioners and motivate the industries towards lean initiatives.

Acknowledgements

The authors desire to acknowledge Mr. Surrender Kumar Midha, Manager Quality,
DENSO Haryana, for his unconditional help during this research. We also give our
sincere thanks to all those who spared their valuable time for filling our questionnaire.
332 B. Singh et al.

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