Implementation of Lean Production Principles and Its Relationship with Performance in Small and Medium-Sized Food Industry Enterprises in Khuzestan Province, Iran

Document Type : Original Research

Authors
M. Molla 1
E. Abbasi 1
S. Choobchian 1
S. D. Hajimirrahimi 2
1 Department of Agricultural Extension and Education, College of Agriculture, Tarbiat Modares University (TMU), Tehran, Islamic Republic of Iran.
2 Imam Khomeini Higher Education Center, Karaj, Islamic Republic of Iran.
Abstract
Lean production system is a new management approach and a business strategy that results in the elimination of waste (costs and time) and improvement of the performance and overall value of an organization. The main objective of this study was to investigate factors influencing implementation of Lean Production Principle (LPP) and its relation with the performance of Small and Medium-sized Food Industry Enterprises (SMFIEs) in Khuzestan Province. This study was a kind of descriptive-correlation and causal-relation that was conducted through a survey technique. Statistical population of the study consisted of all managers in Small and Medium Enterprises (SMEs) in Khuzestan food industry (N= 307). By using Krejcie and Morgan’s tables and stratified random sampling method, 170 person were selected as sample, of which 161 person completed the research questionnaires (return rate 94.7%). The results show that among the eight factors that influence the implementation of LPP, three variables of “customer relationship management”, "human resource management”, and “employees’ empowerment” have the most direct effects on LPP and, ultimately, the highest total effect on SMFIEs performance. The implementation of LPP could explain about 31 percent of variances in SMFIEs performance. Conducting justification and education workshops not only enhances the knowledge of SMFIEs managers, but also helps implement the LPP and, subsequently, improves the performance of SMFIEs.

Keywords

Subjects

Achanga, P., E. Shehab, R. Roy, and Nelder, G. 2006. Critical Success Factors for Lean Implementation within SMEs. J. Manuf. Technol. Manag., 17 (4): 460–471.
Akbari1, M., Danesh, M., Dolatshah, P., and Khosravani, A. 2019. Moderating International Environment Hostility between International Corporate Entrepreneurship and Halal Food Industry. J. Agr. Sci. Tech., 21 (3):545-560.
Akbari, uM., Sakhdari, K., and Danesh, M. 2020. Organizational Preparedness for Corporate Entrepreneurship Performance in Iranian Food Industry. J. Agr. Sci. Tech., 22 (2):361-375.
Alcaraz, J. L. G., A. A. Maldonado, A. A. Iniesta, G. C. Robles, and Hernández, G. A.. 2014. A Systematic Review/Survey for JIT Implementation: Mexican Maquiladoras as Case Study. Comput Ind, 65: 761–773.
Alefari, M., K. Salonitis, and Xu, Y. 2017. The Role of Leadership in Implementing Lean Manufacturing. Procedia CIRP, 63, 756-761.
Ali, J. 2016. Performance of Small and Medium-Sized Food and Agribusiness Enterprises: Evidence from Indian Firms. Int. Food Agribusiness Manag. Rev., 19 (4): 53-64.
Ali Mirzaei, A., A. Asadi, and Tahmasebi, M. 2011. Barriers to the Development of Small and Medium Rural Entrepreneurship Enterprises in Khuzestan Province (Case Study: Dates Supplementary Industries). Journal of Entrepreneurship Development, 3 (12): 165-184. (in Persian)
Amin Bidokhti, A. A., and Zargar, S. M. 2011. Investigating Barriers of Development of Small and Medium Enterprises (SMEs) and Providing a Framework for Supporting These Enterprises. Work and Society, 38:34-48. (in Persian)
Ardic, O. P., N. Mylenko, and Saltane, V. 2011. “Small and Medium Enterprises: A Cross-Country Analysis with a New Data Set. The World Bank.
Armstrong, C. E. 2013. Competence or Flexibility? Survival and Growth Implications of Competitive Strategy Preferences among Small US Businesses. Strateg. Manag. J., 6 (4): 377–398.
Bakas, O., T. Govaert, and Van Landeghem, H. 2011. Challenges and Success Factors for Implementation of Lean Manufacturing in European SMES. Proceedings of the 13th International Conference on the Modern Information Technology in the Innovation Processes of the industrial enterprises (MITIP 2011), Thondheim, Norway.
Beck, T., A. Demirguc-Kunt, and Levine, R. 2005. “SMEs, Growth, and Poverty: Cross-Country Evidence. Journal of Economic Growth, 10(3): 199-229.
Belekoukias, I., J. A. Garza-Reyes, and Kumar, V. 2014. The Impact of Lean Methods and Tools on the Operational Performance of Manufacturing Organizations. Int J Prod Res., 52(18): 5346-5366.
Bhasin, S. 2013. Analysis of Whether Lean is viewed as an Ideology by British Organizations. J. Manuf. Technol. Manag., 24 (4): 536–554.
Borges Lopes, R., F. Freitas, and Sousa, I. 2015. Application of Lean Manufacturing Tools in the Food and Beverage Industries. J. technol. manag. innov., 10(3): 120-130.
Bevilacqua, M., F. E. Ciarapica, and De Sanctis, I. 2017. Lean Practices Implementation and Their Relationships with Operational Responsiveness And Company Performance: An Italian Study. Int J Prod Res., 55(3): 769-794.
Deranek, K., S. Chopra, and Mosher, G. A. 2017. Lean Adoption in a Small and Medium Enterprise: Model Validation. J. Technol. Manag. Appl. Eng., 33(3): 2.
Dora, M., M. Kumar, D. Van Goubergen, A. Molnar, and Gellynck, X. 2013. Operational Performance and Critical Success Factors of Lean Manufacturing in European Food Processing SMEs. Trends Food Sci Tech, 31: 156–164.
Dora, M., D. Van Goubergen, M. Kumar, A. Molnar, and Gellynck, X. 2014. Application of Lean Practices in Small and Medium-sized Food Enterprises. Brit Food, 116(1): 125–141.
Farsi, J. Y., and Toghraee, M. T. 2014. Identification the Main Challenges of Small and Medium Sized Enterprises in Exploiting of Innovative Opportunities (Case Study: Iran SMEs). Journal of Global Entrepreneurship Research (JGER), 4(1): 4.
Feghhi Farahmand, N. 2017. A Model for Evaluating Lean Production in Small and Medium Industries Using a Combination of Confirmatory Factor Analysis, Clustering and LINMAP Techniques (Case Study of Small and Medium Industries of Basic Metals and Fabric). Product. Manag., 40 (11): 221-258. (in Persian)
Fullerton, R. R., F. A. Kennedy, and Widener, S. K. 2014. Lean Manufacturing and Firm Performance: The Incremental Contribution of Lean Management Accounting Practices. J Oper Manag., 32 (7–8): 414–428.
Godinho Filho, M., G. M. D. Ganga, and A. unasekaran, A. 2016. Lean Manufacturing in Brazilian Small and Medium Enterprises: Implementation and Effect on Performance. Int J Prod Res., 54(24): 7523-7545.
Green Jr, K. W., R. A. Inman, L. M. Birou, and Whitten, D. 2014. Total JIT (T-JIT) and Its Impact on Supply Chain Competency and Organizational Performance. Int J Prod Econ., 147: 125–135.
Habibpour Gatabi, K., and Safari Shali, R. 2010. Comprehensive Manual for Using SPSS in Survey Research. Tehran: Loyeh Publication. (in Persian)
Hofer, C., C. Eroglu, and Hofer, A. R. 2012. The Effect of Lean Production on Financial Performance: The Mediating Role of Inventory Leanness. Int J Prod Econ., 128: 2542–2653.
Hong, P., M. Yang, and Dobrzykowski, D. D. 2014. Strategic Customer Service Orientations, Lean Manufacturing Practices and Performance Outcomes: An Empirical Study. J. Serv. Manag., 25 (5): 699–723.
Hosseini, S. S. 2017. Identification and ranking the factors affecting lean manufacturing by using FAHP technique (Case study of Iran Transfo Corporation0. International Academic Journal of Science and Engineering, 3(4): 20-27. (in Persian)
Hu, Q., R. Mason, S. J. Williams, and Found, P. 2015. Lean implementation within SMEs: A literature review. J Manuf Technol Mana., 26(7): 980–1012.
Jani, S. Y. 2018. “Development of Lean Practices Model for Small and Medium Scale Manufacturing Industries SMEs in Gujarat State.” Unpublished thesis, C. U. Shah University.
Iran Statistic Center. 2014. Statistical Year Book, Iran. (in Persian).
Jasti, N. V. K., and Kodali, R. 2015. Lean Production: Literature Review and Trends. Int J Prod Res., 53(3): 867-885.
Kafuku, J. M. 2019. Factors for Effective Implementation of Lean Manufacturing Practice in Selected Industries in Tanzania. Procedia Manuf., 33: 351-358.
Knol, W. H., J. Slomp, R. L. Schouteten, and Lauche, K. 2018. Implementing Lean Practices in Manufacturing SMEs: Testing ‘Critical Success Factors’ Using Necessary Condition Analysis. Int J Prod Res., 1-19.
Krejcie, R. V. and D. W. Morgan, D. W. 1970. “Determining Sample Size for Research Activities. Educ. Psychol. Meas., 30(3): 607-610.
Liker, J. K. 2004. The Toyota way: 14 Management Principles from The World’s Greatest Manufacturer. New York: McGraw-Hill.
Martínez-Jurado, P. J., J. Moyano-Fuentes, and Jerez-Gómez, P. 2014. Human Resource Management in Lean Production Adoption and Implementation Processes: Success Factors in the Aeronautics Industry. Bus. Res. Q., 17(1): 47-68.
Nawanir, G., L. Kong Teong, and Norezam Othman, S. 2013. Impact of Lean Practices on Operations Performance and Business Performance: Some Evidence from Indonesian Manufacturing Companies. J. Manuf. Technol. Manag., 24(7): 1019-1050.
Netland, T. H. 2016. Critical Success Factors for Implementing Lean Production: The Effect of Contingencies. . Int J Prod Res., 54(8): 2433-2448.
Nordin, N., B. M. Deros, and Wahab, D. A. 2010. A Survey on Lean Manufacturing Implementation in Malaysian Automotive Industry. Int. J. Innov. Technol. Manag., 1(4): 374.
Olivella, J., L. Cuatrecasas, and Gavilán, N. 2008. Work Organization Practices for Lean Production. J. Manuf. Technol. Manag., 19 (7), 798-811.
Panwar, A., R. Jain, A. P. S. Rathore, B. Nepal, and Lyons, A. C. 2018. The Impact of Lean Practices on Operational Performance–An Empirical Investigation of Indian Process Industries. Prod Plan Control, 29(2): 158-169.
Powell, D., J. Riezebos, and. Strandhagen, J. O. 2013. Lean Production and ERP Systems in Small and Medium-Sized Enterprises: ERP Support for Pull Production. . Int J Prod Res, 51(2): 395-409.
Punnakitikashem, P., N. Buavaraporn, and Chen, L. 2013. An Investigation of Factors Affecting Lean Implementation Success of Thai Logistics Companies. In 24th POMS Annual Conference (pp. 1-10).
Roslin, E. N., S. A. M. Shahadat, S. Z. M. Dawal, and Mirmohammad Sadeghi, S. 2014. A Conceptual Model for Full-Blown Implementation of Lean Manufacturing System in Malaysian Automotive Industry. In Proceedings of the 2014 International Conference on Industrial Engineering and Operations Management, Bali, Indonesia. Http:iieom. Org.ieom2014.pdfs.292. Pdf (Accessed June 2 2014).
Sahoo, S. and Yadav, S. 2018. Lean Implementation in Small and Medium-Sized Enterprises: An Empirical Study of Indian Manufacturing Firms. Benchmark Int J, 25(4): 1121-1147.
Satolo, E. G., L. E. de Moura Hiraga, G. A. Goes, and Lourenzani, W. L. 2016. Lean Production Assessment in a Sugarcane Agribusiness: A Case Study in Brazil. Indep. J. Manag. Prod., 7(3): 937-952.
Seyed Hoseini S. M., Bayat Tork, A. 2005. Lean Production Factors Assessment in Non-Continuous Production Organizations (A Case Study on Sadid Industry Group). IQBQ, 9 (2):59-89 (in Persian)
Simões, V. 2008. Critical Factors of Lean Implementation in Manufacturing Environments. Unpublished thesis. Engineering University of Porto.
Wiengarten, F., C. Gimenez, B. Fynes, and Ferdows, K. 2015. Exploring the Importance of Cultural Collectivism on the Efficacy of Lean Practices: Taking an Organizational and National Perspective. Int. J. Oper. Prod. Manag., 35 (3): 370–391.
Womack, J. P., D. T. Jones, and Roos, D. 1990. The Machine That Changed the World. New York: Reason Associates.
Yadav, V., R. Jain, M. L. Mittal, A. Panwar, and Lyons, A. 2019. The Impact of Lean Practices on the Operational Performance of SMEs in India. Ind Manage Data Syst., 119 (2): 317-330.
Yoshino, N. and Taghizadeh-Hesary, F. 2016. Major Challenges Facing Small and Medium sized Enterprises in Asia and Solutions for Mitigating Them. ADBI Working Paper 564. Tokyo: Asian Development Bank Institute‌ Available: http://www.adb.org/publications/major challenges-facing-small-and-medium-sized-enterprises-asia-and-solutions/
Zanjirchee, S. M., and Sayadi Turanloo, H. 2009. Methodology Explaining the Critical Factors of Successful and Failure of Manufacturing Organizations by Fuzzy Approach. International Journal of Industrial Engineering & Production Management, 20 (4): 1-10.
Zhaveh Tash, H., and Kabaranzad Ghadim, M. R. 2014. Investigating Factors Influencing Lean Production Implementation in Pars Khodro Company. International Management Conference, Mobin Cultural Ambassadors Institute, Tehran, ‌ https://www.civilica.com/Paper-ICOM01-ICOM01_0983.html. (in Persian)
Zhou, B. 2016. Lean Principles, Practices, and Impacts: A Study on Small and Medium-Sized Enterprises (SMEs). Ann. Oper. Res., 241(1-2): 457-474.
Journal of Agricultural Science and Technology
Volume 23, Issue 6
November and December 2021
Pages 1239-1253