Classification of Lean Firms on Widespread Adoption of Lean Principles using Cluster Analysis

Abstract

The purpose of this study is to determine the essential lean domain principles required for widespread adoption of Lean Manufacturing Practices and to empirically prove lean domain principles has an impact on achieving higher operational benefits. Adoption of lean principles should lead to higher volumes of production, reduction in rejection rate, decrease in cost of production and manufacturing cycle time and thus helps to achieve operational benefits. Data was collected from engineering goods manufacturing firms with batch process and employee size of more than 100. The research framework was tested by classifying the firms as ‘Widespread Lean Firm’ and ‘Limited Lean Firm’ using cluster analysis and validated through discrimant analysis. The results of the hypothesis test indicate that firms with widespread adoption of lean manufacturing practices were able to achieve higher operational benefits.