University of Nottingham (Malaysia Campus) masters student Edmen Tam has compiled, with the guidance of Dr. Christina Chin, a research project on the status of lean in Malaysia. What’s happening with the introduction of lean into this rapidly growing Asian economy?

This article discusses the findings and results of the questionnaire that was sent out to manufacturing companies.

For this research, an electronic survey questionnaire was designed and sent to a total of 2390 companies in Malaysia of various manufacturing backgrounds. The manufacturing companies included of metal, concrete, heating, ventilation, and air conditioning (HVAC), electrical and electronic, medical and other miscellaneous materials manufacturing. The manufacturing companies involved in this study ranged from medium to large scale with a varying number of employees.The survey questionnaire consists of five sections;

(a) Demographic data (year of establishment, products manufactured, number of employee)

(b) 14 lean principles

(c) Quality management systems utilised by the company

(d) Benefits and disadvantages of lean

The questions were designed in different style for each section namely; on a range of ‘yes’ and ‘no’ options and a five-point scale to measure the extent of implementation and agreement described by each of the items. The scale used ranged from 1 = not implemented, to 5 = completely implemented and also 1 = strongly disagree, to 5 = strongly disagree. Employees working in the manufacturing industry were consulted to gain feedback on the initial survey. The comments and feedback were taken into consideration. Apart from the e-survey distributed, a semi-structured interview based on the survey questionnaire was also conducted with three manufacturing companies.

Results

A total of 24 complete respondent’s data was collected out of 2390 enquiries. The possible reasons of low response rate may be due to confidentiality issues to avoid the sharing of personal practices to their competitors. Yet, no personal information e.g. profit attainment of company or layouts of production lines were questioned in the survey. All data collection was assured for the scope of the research only. The following section discusses the results obtained from the survey’s five sections.

Respondent profile

71% respondents are in manager positions, thus this validates the authenticity of their answers because of their first-hand knowledge and experience from direct involvement in the implementation of lean manufacturing in the company, around 42% of the companies manufactured metal products. It was also found 75% of companies implement ISO9001 as their preferred quality management system. However, 63% were well established companies of over 20 years.

 

Lean adoption status

In this section, a total of 67% of respondents utilised and practiced lean in their production lines. Of those 67%, 81% are large corporations whereas 19% are small medium enterprises (SMEs). Based on the result, it was evident companies which are less than 10 years of establishment are less likely to implement lean as opposed to companies which are more than 20 years old. Equally, larger companies are more likely to adopt lean principles.

This is evident based on the studies conducted by Shah and Ward, and Bonavia and Marin, where smaller manufacturing companies are less likely to implement lean principles due to restrictions and barriers. For instance the transition towards lean for a new company is difficult because the need to being lean is more than implementing a set of tools and principles. Being lean is a culture and philosophy on its own so much that a company must build an organisation where learning and continuous improvements are the norm.

As a result, larger companies implement lean because they understand the culture of lean through experience. However, a few SMEs also implement lean principles as a preliminary practice, and will likely implement further as the company matures. For companies opting not to implement lean, the reasons for their decision were, for instance, the lack of expertise and general understanding in the subject at hand. Although, companies know which segment of their production line requires improvement, however due to the lack of understanding of lean, the situational problem in their production lines remains unsolved (see Table 4).

 

Adoption of lean principles

To substantiate the extent of lean adoption in Malaysian companies, the respondents were asked to rate the adoption level of lean principles. 80% of companies agreed in practicing the long term philosophy principles in the organisation (see Figure 1). While only 19% believed a larger inventory is preferred due to lack of lean knowledge. However, this majority disagreed with the philosophy, as it may result in overproduction and wastes in manufacturing. As a result of overproduction, opportunities for improvements and quality of products are reduced, increased of holding costs and most importantly, lead times will be longer which disrupts the flow of the production line.

Based on the results (see Figure 2), 5S were identified as the leading lean tool majority of companies utilised in their workplace with a mean score of 3.65. This followed by standardised workflows and pull production control with a mean score of 3.45 and 3.4 respectively. This result is aligned with a previous research done, which suggests the most applied tool utilised by Malaysian industries is 5S. It is no surprise 5S is the most implemented tool in companies as cleanliness of the workspace are always emphasised and practiced. 5S also creates a well-organised, smooth flowing manufacturing process which ensures a safe and clean environment for the employees. Lean tools with mean score of less than 3 were namely poka-yoke, VSM, kanban and single-minute exchange of Die (SMED) which were implemented primarily in larger companies.

People and partners development was important, with a high majority of 90% companies ascertain this principle is in place. Finally, in terms of problem solving, all large scale companies agreed they tend to observe as the key techniques for continuous root problem solving as part of their organisational learning principles.

 

Advantages and disadvantages of lean implementation

In terms of lean advantages, results revealed that overall companies generally agreed and realise the benefits of lean implementation with a mean score of more than 3. They had rated the following top advantages of lean; reduces process waste, financial savings and effective labour usage with a mean score of 3.85 and 3.8 respectively (see Figure 5). Though a handful disagreed, it should be noted that these companies do not integrate lean principles in their production lines. As such, the key to lean implementation is knowledge and understanding of its implementation and effectiveness in the manufacturing line.

In view of lean disadvantages, an average mean score of 2.3 was obtained whereby; large companies disagree on any significance of disadvantages that lean would create. However, SMEs surveyed was in total agreement on some of the lean disadvantages. For instance, the cost of lean tools implementation required a large investment in equipment and facilities; subsequently requires the recruitment of lean consultants to aid the lean process. As a result, SMEs and new companies feel intimidated by the scale of lean implementation thus provoke a higher level of resistance.

 

How do we fix these problems in the future?

There is no right way to become lean as every company’s lean journey begins under disparate conditions. In order to become a successful lean company, there are also many factors that have to be taken into consideration. As a result from this research, one of its aims is to recommend methods and principles of lean that can be used by companies to improve their production line. Upon leveraging the literature and results collected, the following recommendations were extracted to guide companies in considering the importance and benefits of lean adoption.

Focus on long term results: The adoption of lean requires a long-term commitment from a company as it takes more than a year to two in order to harness the necessary momentum towards the lean journey. Even though a company utilises tools for swift and notable improvements, over time, the benefits gained from lean tools would deteriorate if the company does not employ a sustainable way of production. Based on the data gathered, a majority of 86% of companies surveyed indicated that they focus highly on long term goals.

Embed a set of rules and principles: The success of lean requires a culture that embraces learning and continuous improvement as a second nature to both the employees and management. The implementation of lean tools should not only focus on the physical changes in the production line, rather sharing of lean philosophies and intended company’s goals with the employees as the essence. By embedding this principle, the company and its employee share the same ideology and work culture towards a common mission and vision.

Eliminate the resistance to change: As the company embarks towards becoming lean, the management must educate the employees on the necessary changes in order to move forward with the company. In order to minimise the resistance and fear, employees must comprehend and understand lean to be assured on the challenges ahead.

Training and development: Employees should be provided with the necessary training to ascertain their continuously learning and develop new skills in necessity for a better and improved production line in the manufacturing industry. With such scheme, the creation of a stronger working culture for lean would benefit not only the company in product flow and more efficient layout to the production line but equally to the employees as well.

 

In the future

The majority of companies surveyed implement lean tools and principles and agreed upon lean’s benefits and importance than drawbacks. In general, companies need to be aware that lean functions are more than a set of tools and processes, because being lean is a culture on its own that involves the employees, management and suppliers as a whole to be successful.

The culture of lean dictates a company should always strive for perfection and additionally continuous learning and improvement. A company that feels lean would never end; fail to comprehend that the integration of lean is not meant to stop at a certain point. However, being lean is more about adopting a culture of continually seeking perfection rather than thinking of tools and processes alone. As such, this research project intimates that the most common barriers companies face in attempting to apply lean are mainly due to a lack of expertise and general understanding of lean principles. Evidently, the indispensable factors a company must take for successful implementation of lean are:

(1) Strategic application of lean tools surrounding the production line;

(2) Focus on strategic goals, and

(3) Continuous improvement for perfection for the production flow and employees mind set.

The future direction of this research is to utilise the mixed method approach for more extensive data gathering and to conduct a comparative review of lean principles, adoption and practices in the South East Asia region.