Investigation and Assessment the Level of Adoption Lean Philosophy in SMES Under Uncertainty by EFA/FAHP/FTOPSIS Integrated Model

Abstract

Abstract Small and Medium Enterprises (SMEs), thus it is pursues to improve their performance to stay in the global competitive markets through adopting an efficient manufacturing systems, one of them is lean production (LP). LP is a continuous improvement philosophy that based on using various lean activities to improve enterprise performance by eliminating various type of waste. In this paper, a Lean Level Assessment Methodology is proposed which integrated Exploratory Factor Analysis (EFA), Fuzzy Analytic Hierarchy Process (FAHP) and Fuzzy Technique for Order of Preference by Similarity to Ideal Solution (FTOPSIS) to identify level of importance of lean activities and assess the level of SMEs leanness concerning five dimensions of lean activities. SMEs lean activities have surveyed through a comprehensive literature review, where twenty six lean activities have identified as the most common SMEs activities that classifying into five lean dimensions. A questionnaire was developed to collect data related to the levels of adoption of these lean activities by SMEs using a triple Likert scale. EFA was used to extract the most influencing lean activities on SMEs leanness based on questionnaire data. FAHP was used to determine the weights and the level of importance of these lean activities, while FTOPSIS was employed to investigate and assess the level of SMEs’ leanness related to the five lean dimensions activities. The proposed methodology has applied in four Iraqi SMEs (A1, A2, A3, and A4) for producing healthy water and soft drink in Baghdad. The results have explained that only 19 lean activities are the most influencing on SMEs leanness. Efficient manager is an important lean activity that has 58.90% level of importance. Although the four Iraqi SMEs have approximately acceptable level of leanness related the five lean dimensions, there is variation in adoption these lean dimensions activities by SMEs. SMEs management should develop a continuous improvement strategy based on utilizing SMEs’ efforts and resources to improve activities of the weaker dimension for improving their competitiveness and ensuring sustainability in the rapidly changing business environment. One limitation of this paper is the difficulty in obtaining data related to lean activities and their performance through SMEs’ processes and activities.