IMPACT OF LEAN MANUFACTURING ON THE OPERATIONAL PERFORMANCE: EVIDENCE FROM TEXTILE INDUSTRY

Abstract

Purpose of the study: Lean manufacturing is perceived to be a significant competitive advantage of firms as it removes waste from manufacturing operations with innovations in products and processes. This research aims to know the impact of lean manufacturing practices of textile firms on their operational efficiency. Methodology: For this study, questionnaires were electronically sent to operation/ production managers of 122 textile firms using lean manufacturing technologies in Pakistan. Based on the literature review, nine lean manufacturing practices and five operational performance measures were included in the questionnaire survey. Just 91 operation managers replied, a response rate of 74%. Multiple regression analysis was performed to test the hypotheses of the study. Main findings: The results of regression analysis show that lean manufacturing practices significantly impact the operational performance of textile firms. The study's findings suggest that the involvement of customers, suppliers, and employees causes an increase in the operating performance of firms. Moreover, it is established that some lean manufacturing practices such as 5S, automation (Jidoka), Justin time (JIT), equipment layout, and continuous improvement (Kaizen) have a significant and positive effect on the operational performance of firms. Application of the study: The lean manufacturing practices save money for businesses and increases overall productivity by reducing waste. These are also helpful in increasing consumer loyalty and employee productivity. The study's results show that lean production methods can be adopted to improve operating performance and competitiveness. Originality/ Novelty: This study adds a piece of first-hand evidence by establishing a significant effect of lean manufacturing practices of firms on their operational performance in Pakistan, where most of the firms so far are using traditional techniques due to lack of financial resources.