LITERATURE REVIEW

2.1 Introduction
This chapter presents a review of related literature to understand and build the framework for the
study. It discusses the theories upon which the study would be conducted, the concept of lean
manufacturing, the benefits, challenges and lean implementation tools and techniques. It finally
provides empirical literature review to establish the impact of lean manufacturing.

2.2 Theoretical Framework

(Nhan, 2020) defined a theoretical framework as the use of a theory (or theories) in a study that
simultaneously conveys the deepest values of the researcher(s) and provides an articulated
signpost or lens for how the study will process new knowledge. The framework shapes the types
of questions asked, guides the method by which data are collected and analyzed, and informs the
discussion of the results of the study (Luft, et al., 2022). It is related and/or reflects the
hypothesis of a study and often ‘borrowed’ by the researcher to build his/her own house or
research inquiry (Adom, et al., 2018). This study was guided by and anchored on resource-based
view and theory of constraint.

2.2.1 Resource-Based View

The view of this theory is that institutions can only be successful when they effectively and
efficiently utilize their resources in the safest manner in order to ensure a safer environment
(Kaikai & Mose, 2020). Thus, it is important for the companies to acquire the essential resources
that are useful in implementation of the green management practices; so, as such, resource-based
view theory provides an analysis of the resources required. (Quyen, 2020) explained that the
natural resource-based view is an essential part for the firm to connect between the
environmental performances and to attain the competitive advantage in the corporate market. In
the resource based view, the distribution of resources to non-core activities leads to opportunity
costs (Nasiche & Ngugi, 2014). This theory explains that the growth and development of a firm
specifically depends on the available resources within the firm (Anane, 2020), and its main

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principle is that the basis for a competitive advantage of a firm lies primarily in the application of
the bundle of the valuable resources at the firm’s disposal (Kipkorir & Wanyoike, 2015).

The RBV is built on the concept that resources and capabilities are not heterogeneous across
other organizations, and through the utilization of this concept the success rate variations
between organizations can be explained (Almarri & Gardiner, 2014). The core idea of the theory
is that instead of looking at the competitive business environment to get a niche in the market or
an edge over competition and threats, the organisation should instead look within at the resources
and potential it already has available (Chigara, 2021). Given its focus on the resource as the
firm’s significant component and its uncomplicated view of firms as a bundle of these resources,
the RBV is explicitly reductionist since it stands against holistic or emergent theories that liken
firms to organisms with complex feedback-controlled mechanisms focused on boundary
maintenance (Kraaijenbrink, et al., 2010).

2.2.2 Theory of Constraint

The Theory of Constraints, known as TOC, explains a procedure for managing factors,
production processes, organizational decisions and situations in which there are constraints in the
present state (Pozo, et al., 2009). They further commented that it is a business management tool
that links all the manufacturing techniques and that makes it possible to relate the solutions to a
firm’s critical problems (regardless of its size), to ensure that its ongoing improvement process
continues unabated. According to TOC, there is always, at least, one single constraint, and TOC
implements a concentrating process to detect the constraint and restructure the remaining of the
organization around it (Oroujia, 2016).

This theory is highly attractive because it suggests focusing attention and improving efforts only
on the constraints, which will bring a promise of high efficacy and obtaining great results with
the smallest possible outlay (Urban, 2019). By using the Theory of Constraints, management can
control the contribution margin and the product’s unit production cycle with regard to its critical
resources, i.e., its constraints (bottlenecks), thus raising production capacity (Pozo, et al., 2009).
Theory of Constraints (TOC) represents a global management philosophy that considers that the
organization works to make profit (MELENDEZ, et al., 2018). Originally TOC focused on
planning the production process and allocating resources but its content is improved day by day

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as the technology evolves and competition between rival companies increases in business world
(Şimşit, et al., 2014).

2.3 Conceptual Framework

2.3.1 The Concept of Lean
(Gobinath, et al., 2015) believe that lean evolved from Toyota after world war 2nd as a business
strategy due to the limited resources available in Japan, unlike the vast resources available to
manufactures in the US. (Dave, 2020) maintain that lean originated from the period American
feared that the Japanese manufacturing companies in the car industry would take over and gain a
matchless competitive advantage. After the finishing of World War 2, lean manufacturing was
developed by Japanese manufacturers mainly in automotive industry (Chahal & Narwal, 2017).
The automotive industry pioneered the application of the Lean System, but today it is possible to
see it running at many kinds of manufacturing industries such as electronics, steel, aerospace,
machinery building and more (Lobato, et al., 2021). Consequently, the process of Lean
Manufacturing has been the main concerns and issues of many manufacturing companies
throughout the world (Mahadevan & Dinesh, 2018).

Lean manufacturing has a very long history, which depends on how lean is defined (Adzrie, et
al., 2020). LM was derived from the Toyota Production System (TPS) that gained popularity in
the 20th century as the least-cost production method by creating customer value and eliminating
waste (Ramkumar, et al., 2021). TPS was introduced by Taichii Ohno but was widely referred as
just-in-time (JIT) manufacturing in the 1980s (Adzrie, et al., 2020), and today known as “Lean
Manufacturing (Chahal & Narwal, 2017) . TPS tried to cut production costs by removing all
forms of waste that were naturally incorporated, while looking for solutions to technical and
organizational challenges within shop-floor activities (Alves, et al., 2011). Lean is developed
principally from the TPS although it includes many other sources (Adzrie, et al., 2020).

Since lean affects every aspect of an organization, it can be rather considered as a new
management philosophy (AlManei, et al., 2017). As a new direction of sustainability, the
practical implementation of lean philosophy has been towards eliminating all activities that
consume time and resources (Kafuku, 2019). Its principles are based on the value of the

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product/service as perceived by the customer and then making the flow in-line with the customer
pull and striving for perfection through continuous improvement to eliminate waste by sorting
out Value Added activity(VA) and Non- Value Added activity(NVA) (Sundar, et al., 2014). The
theory of lean manufacturing illustrates manufacturing process without waste although LM
practices are especially advantageous in companies that are involved in mass productions of
products (Aryarathne & Galahitiyawe, 2022). A number of companies, both within and outside
the manufacturing sector, have implemented lean, although the degrees of success varied across
these companies (Alefari, et al., 2020).

It is very difficult to find a concise definition of lean which everyone agrees because authors
defined it distinctively (Sujatha & Prahlada Rao, 2013). The use of the term “lean” denotes a
concept that has since literally exploded, with almost having many definitions being proposed
and employed (Anon., 2021). (Gobinath, et al., 2015) defined Lean manufacturing as “A
systematic approach for identifying and eliminating waste through continuous improvement by
flowing the product at the pull of customer in pursuit of perfection”. Lean manufacturing is
defined as “a procedure always designed to lower the costs and waste products in manufacturing
firms” (Awan, et al., 2022). In other words, it is the set of tools that assist in the identification
and reducing of waste in design, manufacturing, distribution and customer service (Adzrie, et al.,
2020). In a nutshell, lean manufacturing can be best defined as an approach to deliver the upmost
value to the customer by eliminating waste through process and human design elements (Sujatha
& Prahlada Rao, 2013).

The focus is on producing high quality products in the most efficient and economical manner
that incorporates less human effort, less inventory, less time to develop products, and less space
to become highly responsive to customer demands (Cheah, et al., 2012). Lean Manufacturing
focuses on shortening the timeline between customer order and shipment and also cutting costs
and improving quality, through the identification and elimination of waste in the value stream
(Bakås, et al., 2011).

The current shape of the lean management concept is strongly influenced on the one hand by
practices for organization of production systems initiated by Toyota and on the other one
numerous and diversified management practices in later years (Jedynak, 2015). Lean production
can be described at different levels of abstraction: it can be defined as a philosophy, as a set of

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principles and as bundles of practices (Vienazindiene & Ciarniene, 2013) (Čiarnienė &
Vienažindienė, 2012). Lean approaches is a versatile process and component that entails an
extensive scope of management practices that involve technology manufacturing management,
quality process and just in time process (Linus & Daud, 2021). The primary idea of LM is to
supply better quality commodities to more consumers at a lower price.

2.3.2 Lean Implementation Tools and Techniques

Lean implementation requires the selection of appropriate tools from the lean arsenal to achieve
process excellence (Pearce & Pons, 2013). Lean manufacturing offers various tools and
techniques that assist in tackling different types of waste effectively and improve efficiency in
different situations (Wong & Wong, 2011). Some of the tools and techniques that are used by
organizations include 5S, Poka – yoke (Error proofing), Kaizen (Continuous improvement), Takt
time, One piece flow, Pull system and Just-In-Time (JIT) (Silva, et al., 2011). A set of lean tools
can be implemented to achieve the aims of lean philosophy and can be categorized into three
categories: quality, production processes, and methods (Saidul Huq & Mitrogogos, 2108).

Over one hundred lean tools that can be implemented exist, although the most important lean
management tools are 5S, Bottleneck Analysis, Continuous Flow, Value Stream Mapping
(VSM), Heijunka (Level scheduling), Hoshin Kanri (Policy deployment), Jidoka
(Autonomination), Just‐In‐Time (JIT), Kaizen (Continuous improvement), Kanban (Pull
System), Key Performance Indicators (KPIs), Muda (Waste), Overall Equipment Effectiveness
(OEE), Plan‐Do‐Check‐Act analysis (PDCA), Poka‐Yoke (Error Proof‐ ing), Root cause
analysis, Single‐Minute‐Exchange of Dies (SMED), Visual Factory, SMART goals,
Standardised Work, Takt Time, Total Productive Maintenance (TPM), Gemba (The real place)
The impact of using different lean manufacturing tools on waste reduction Advances in
Production Engineering & Management 15(1) 2020 83 and Six Big Losses, as of March 23,
2017, as Vorne Industries listed on its website (Leksic, et al., 2020).

The JIT philosophy must be implemented as a systematic and comprehensive transformation of

production and operation procedures (Lara, et al., 2022). Just in Time (JIT) is a type of
operations management approach which originated in Japan in the 1950s as a production strategy
that strives to improve a business return on investment by reducing in-process inventory and

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associated carrying costs (Dange, et al., 2016). The 5S's are key lean ideas derived from the
Japanese words seiri (sort), seiton (set all together), seiso (sparkle), seiketsu (institutionalize) and
shitsuke (sustain) (Singh, et al., 2018).

Table 2.1: Lean Implementation Techniques and Tools

1 5S Reduce wasted time & motion.

2 Automation Reduce human effort and provide accurate automatic system.
3 Continuous Flow Ensuring the continuous flow throughout the value stream.
4 Continuous Improvement Make sure that there is every little improvement every day
and improve overall efficiency.
5 Kan-Ban Schedule production and minimize work-in-process.
6 Kaizen Change for better every day.
7 Single Minute Exchange To minimize setup time and cost thereby freeing capacity
to Die (SMED) and enabling the production of very small lots.
8 Cellular Manufacturing Design cells to optimize process for better performance.
9 Six Sigma Improve quality, operational performance, practices and
systems.
10 Team Motivated team has better knowledge of work.
Development/Training
11 Total Productive Ensure uptime, Improve process capability and consistency
Maintenance
12 Total Quality Improve quality by preventing defects from occurring.
Management (TQM)
13 Value Stream Visualize of processes and their conformance to lean
Mapping (VSM) manufacturing principles.
14 Visual Management To provide immediate, visual information that enables
people to make correct decisions and manage their work and
activities.
15 Work Standardization To ensure that all workers execute their tasks in the same
manner and thus reduce variation from differences in work
method.
22 Flexible manufacturing To provide a systematic flexible change in manufacturing
System (FMS) environment like layout, methods, machine etc.
16 Production leveling Reduce unevenness and waste in industry.
17 Inventory Management Put all inventory products in a proper sequence to supply
these items in proper network.
18 Zero Defect Concept To eliminate all possibility which are responsible for
wastage.
20 WIP (Work in Process) WIP is the summation of all investment factors i.e. all types
of costs put during process.
21 Lean Thinking Discover new ideas to deliver much comfort level and
benefits to industry with eliminating waste.

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Source: (Chahal & Narwal, 2017)

2.3.3 Factors Affecting the Successful Implementation of Lean Concept

The Lean management is a complex organizational system that requires an effective strategic
approach to its implementation in a long-term thinking (Klein, et al., 2022). Also, a
comprehensive and holistic approach is involved in implementing LM in many organizations
involving sustainability and green initiatives (Ramkumar, et al., 2021). This is because it is not
enough for the companies to just implement lean practices to improve performance, but they
need to be aware of management responsibility on using such strategies too (Panigrahi, et al.,
2021). Lean manufacturing is an integrative concept, so its adoption can be characterized by a
collective set of key areas or factors (Sujatha & Prahlada Rao, 2013). Thus, it is important to
develop an understanding of the factors that are critical to the successful implementation of lean
principles and practices (Kundu & Manohar, 2012). A plethora of literature has investigated the
successful implementation of lean tools and practices into different manufacturing companies
(Kafuku, 2019).

To successfully manage lean adoption process, organisations need to thoroughly understand key
factors that govern and facilitate the leanness process of manufacturing systems (Zargun & Al-
Ashaab, 2014), because they are essential parts of lean manufacturing implementation (Kundu &
Manohar, 2012). Lean manufacturing implementation is a strategic activity within a given
organisation supported by management as well as by other employees, and which will succeed
only through joint action (Berlec, et al., 2017). (Kafuku, 2019) identified commitment of
management to increase working capital, provision training to staff on lean philosophy, and
development of mechanism for reducing waste as crucial factors for effective implementation of
lean thinking. Based on their study, (Punnakitikashem, et al., 2013) found that the critical
success factors significantly related to the success implementation of lean included leadership
and management, finance capability and organizational culture.

Implementation of Lean philosophy and principles can be described as a set of actions and
processes that start from planning the change, that define the success factors and that finish by
implementation and measuring the progress (Čiarnienė & Vienažindienė, 2012). Management
needs to address the critical success factors to ensure that 'things must go right' for a project or

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activity to achieve management objectives and business growth (Kundu & Manohar, 2012).
Because the whole organisational culture has to change, and all employees need to go through
the lean learning process and participate in the lean implementation, it is very important to have
proper human resources especially in management and people leading LP implementation in the
company (Berlec, et al., 2017). Thus, (Knol, et al., 2018) claim that should the required aspect
not have been in place, this success factor might have been the bottleneck for the implementation
of lean practices.

In brief, to succeed with implementing a lean programme in a factory, managers must commit to
and involve themselves in the activities of implementation (Netland, 2016). (Bakås, et al., 2011)
suggested the critical success factors for lean implementation, which are noted below.

 Ensure strong leadership and management involvement

 Allow for thorough employee involvement and sufficient participation
 Allocate sufficient time for preparing the organisation
 Make sure that sufficient motivation for completing initiatives exists
 Build competence in the internal organisation 6. Make sure a performance evaluation
system is established in parallel

2.3.4 Challenges Associated with the Implementation of the Lean Concept

Lean is a well-recognized structure because it can help grow the organization on all aspects even
though many companies face problems with its implementation (Pandey & Tyagi, 2018),
because its implementation manufacturing can be considered as any other change introduced to a
company (AlManei, et al., 2017). According to (AlManei, et al., 2017), change is identified as
the behavioural shift of “the organization as a whole, from one being to another”. The
implementation of Lean-methods as something new to the culture can be a difficult challenge
since the need is felt to convince managers and employees to think and act in ways that are
foreign to them (Bakke & Johansen, 2019). (AlManei, et al., 2017) summarised the common root
cases of failing lean implementation and grouped them into five. They are:

 Lean suppliers
 Leadership

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  Employee involvement
 Tools and techniques
 Business systems

(Cheah, et al., 2012) also highlighted the challenges of lean manufacturing implementation.
The challenges identified are given in table 2.2.

Table 2.2 Challenges of Lean Manufacturing Implementation

 Uncertainties in demand
 Pressure from customer
 Pressure from top management
 Non effective method (e.g., inventory management)
 Projects implementation
 Knowledge and information transfer (effective communication)
 Training
 Lack of common vision
 Non lean behaviour (increase flow time, increase waste)
Source: (Cheah, et al., 2012)

The change in the organizational culture is the backbone of the success of the Lean approach
since lean approach cannot be sustained without a cultural shift and a clear direction set by the
organization’s leadership team (Maware & Parsley, 2022).

2.3.5 Benefits of Lean Concept

Lean production can be regarded as an advanced mode of modern management due to its ability
to minimize inventory, perceive and eliminate waste, shorten the development and production
cycle, and bring huge benefits to enterprises (Han, 2018). (Chan, et al., 2019) observe that
organisations around the globe are choosing to adopt LPS to eliminate waste and increase their
productivity because this approach has demonstrated an overwhelming influence on the
restructuring of the global industry. Lean manufacturing also emphasises visual control and
transparency, which makes it easier to identify problems in the process (Buer, et al., 2018). In
brief, lean management seeks to implement business processes that achieve high quality, safety

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and worker morale, whilst it reduces cost and shortens lead times (Kareem, et al., 2017). For this
reason, (Silva, et al., 2011) argue that it is one of the techniques that is getting popular among
local apparel manufacturers.

Lean is regarded to be beneficial since a company can increase profit, reduce cost and remain
competitive in the market if it can eliminate the unnecessary factors involved in the
manufacturing process (Mahadevan & Dinesh, 2018). Lean manufacturing is a methodology that
reduces waste and increases productivity within the organization (Kaneku-Orbegozo, et al.,
2019). The concern of lean process is directed toward reducing production time and eliminating
waste in all the possible areas across the production lines (Ramkumar, et al., 2021). As a
philosophy that is based on customer-focused process improvements, the key idea behind lean is
to increase value to customers while reducing the number of resources consumed and cycle times
via waste elimination (Čiarnienė & Vienažindienė, 2012). The benefits of lean implementation
include an increase in customer satisfaction, workplace safety, efficiency and quality (Adzrie, et
al., 2020).

2.3.6 Supply Chain Disruptions

External and internal factors can cause supply chain disruption. Internal factors originate from
within the supply chain and they include production line break down, IT problems, demand
fluctuations, sustainability issues or quality problems. External causes, which do not originate
from within the supply chain, include labour strikes, regulatory changes, weather conditions,
financial turbulence, terrorism and counterfeiting. Furthermore, supply chain disruptions can be
man-made and somewhat controllable or caused by natural disasters and consequently more
unpredictable. Supply chain disruptions may occur for long period and their impacts on the
performance of a supply chain can be severe if the organisation does not have a resilient supply
chain.

To reduce supply chain risk, supply chains must be designed to incorporate event readiness,
provide an efficient and effective response, and recover to their original state after supply
disruptions (Aigbogun, et al., 2018). In fact, manufacturing firms should be responsive by being
able to reconfigure their supply chain practices (Piprani, et al., 2020). This implies that
organisations should foster supply chain resilience (SCRes). Achieving and increasing SCRes is

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high on the agenda of researchers, organisations, supply chains, industries, governments, and
economic institutions (Scholten, et al., 2020).

SCRes facilitates firms into quickly responding to any unforeseen changes and in restoring their
operations by combining and reconfiguring the firms’ available resources and capabilities
(Piprani, et al., 2020). Indeed, building SCRes can require organisations and supply chains to
contribute to resilience at an industry, national or supranational level (Scholten, et al., 2020). For
examples, organisations have started practising responsible business operations such as green
purchasing, environment, social and governance (ESG). Thus, resilience is a proactive approach
which helps business organizations to elude avoidable risks and bounce back quickly from
unexpected/unavoidable risks (uncertainties) in the supply chain (Aigbogun, et al., 2018).

2.4 Review of Empirical Literature

(Erceg, 2022) carried out a study that to present lean thinking implementation in manufacturing
companies to improve procedures and increase competitiveness. The author found some
proposed improvements to business processes, and thus Frozen Ltd. saved time and costs,
making it more competitive in the market. The hypothesis that the lean methodology can help a
company perform its business processes better, was confirmed. The author further suggested that
the company needs to continue with its efforts to use lean since this is not a single event but a
journey.

Moreover, (Aryarathne & Galahitiyawe, 2022) conducted a study to explain the impact of lean
manufacturing practices on operational performances. Cross sectional data drawn from a survey
sample of 386 managers in the apparel sector with a simple random sampling were used. Data
were analyzed using SPSS and Structural Equation Modeling. The study found a positive impact
of lean manufacturing practices towards operational performances.

In another study, (Klein, et al., 2022) evaluated the influence of Lean practices on process
effectiveness. A survey method that collected data through a questionnaire, was adopted The
population of the study was composed by all the administrative servants of a public institution in
Brazil, with a sample of 997 answers obtained from the studied institution. The data analysis was
carried out by means of descriptive statistics, exploratory and confirmatory factor analysis, and

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multiple regression. The result showed a positive influence of four Lean practices on the
effectiveness of processes. Based on this, the authors concluded that Lean practices act as a basis
for the effectiveness of processes and may optimize operational and administrative activities in
public organizations.

Also, (Linus & Daud, 2021) examined lean production approach in Nigeria manufacturing sector
by looking into the relevance of adopting lean production in the manufacturing sector and how
lean practices influence performance. The study employed a contemporary systematic review of
literature from lean production as a methodical approach for the study. It was revealed that the
acceptance or approval of lean practices will provide the desired support and quality that are
important to improved performance in manufacturing companies. The study argues that the
manufacturing sector will have control over waste minimization and cost reduction that will meet
better quality and improved performance. Thus, the authors urged manufacturing sector to accept
the variant of lean production if performance improvement is to be achieved in the
manufacturing sector/

Furthermore, (Alhuraish, et al., 2016) determine the companies’ performance for industries
applied lean manufacturing and six sigma. It was found that companies implementing lean
manufacturing and six sigma have wealthy performance across financial performance,
operational performance and innovation performance. The various lean six sigma tools such as
Kanban, TPM, 5S, VOC, Gemba etc., were found to be associated with improved financial or
operational or innovation performance. Thus, they concluded that corporations get more
advantage in using quality practices to improve quality, reduce cost, improve productivity and so
on, compared to companies that have not implemented at all.

(Awan, et al., 2022) also examined the influence of various lean manufacturing practices on the
sustainability performance of companies and the mediating role of green supply chain
management (GSCM). The data was collected using questionnaires administered to 250
Pakistani manufacturing firms and analyzed using AMOS 25. Results demonstrate that process
and equipment, product design, supplier relationships, and customer relationships significantly
affect sustainable performance.

(Lara, et al., 2022) evaluated empirically whether the degree to which a company implements a
combination of Just in Time (JIT) or Lean Manufacturing practices systematically affects the

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company's operational, financial, and/or organisational performance. Meta-analysis was adopted
to gather secondary data in Web of Science, EBSCO, and Science Direct databases, with an open
period, considering all works available until July 2020. The authors found that Lean
manufacturing practices demonstrate a positive and significant relationship in operational,
financial, and organisational performance, all with an average impact on the effect size.

Besides, it was obtained from the study conducted by (BOUAZZA, et al., 2021) that advanced
Lean Manufacturing’s tools have positive impact on the environmental performance. In a study
of (Abobakr, et al., 2022), they used quantitative model to investigate whether Lean
Manufacturing (LM) practices/tools can improve the three aspects of corporate sustainability
performance (economic, environmental, and social). Their study confirmed that a significant
association exists between LM practices/tools implementation and the improvement on three
aspects of corporate sustainability performance (economic, environmental, and social).

In another study, (Alaaraj & Bakri, 2019) examined the effect of lean manufacturing on financial
performance from the perspective of managers in the industrial sector in South Lebanon.
Quantitative method was used and 152 self-administered questionnaires were distributed
randomly among managers. The data was analyzed using SPSS software. The results showed
that lean manufacturing has a significant and positive effect on financial performance. Also,
(Bandi, et al., 2022) determined the most used of LM tools and how these tools can impact the
operational performance. Based on the eleven completed responses that were collected in the
survey through convenience sampling method, the empirical results through descriptive analysis
revealed that usage of LM tools such as 5S and Kaizen can lead companies in improving their
processes.

(Panigrahi, et al., 2021) also carried out a study to empirically investigate the influence of lean
manufacturing (LM) practices on the operational and business performance of manufacturing
companies in Oman. In their study, they used a self-administered structured survey questionnaire
to collect data from 185 companies. The statistical analysis obtained from structural equation
modeling found that lean manufacturing practices can explain operational performance, although
lean practices were unable to benefit overall business performance. The results of the study of
(Maware & Adetunji, 2019) indicated that operational performance was improved by
implementing the selected LM tools.

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2.5: Chapter Summary
This chapter has provided the theories related to this study. It started off by defining theoretical
framework and the n discussed the two theories – resource-based view and theory of constraint –
that established the ground for the study. The concept of lean was explained, in addition to the
challenges, benefits, lean implementation tools and techniques and successful factors for lean
implementation. Finally, a summary of the empirical literature reviewed was done.

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