Towards Achieving a Sustainable Lean Transformation: Measuring Tangible and Intangible Gains

Towards Achieving a Sustainable Lean Transformation: Measuring Tangible and Intangible Gains

DOI: 10.4018/979-8-3693-0458-7.ch003
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Toyota Motor's success as a global brand automobile manufacturer has inspired manufacturing organizations worldwide to pursue lean transformation. However, a lack of understanding of lean sustainability hampers their progress towards achieving true lean organization status like Toyota. Without proper measurement, the gains from lean improvements remain unknown, leading to inaccuracies in strategy deployment. This chapter aims to define sustainable lean transformation gains and propose indicators to measure them. Extensive literature review reveals the importance of tangible and intangible indicators. To validate the proposed measurements, a survey involving 7 lean experts and 92 practitioners was conducted. Data analysis utilized content validity index, inter-rater agreement, and measurement model analysis. The chapter concludes by suggesting research opportunities to enhance lean management knowledge.
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Literature Review

This literature review section commences with an examination of short-term and long-term gains and objectives arising from lean transformation results. Subsequently, a spectrum of real-world scenarios across industries is presented, illustrating both the successes and challenges that organizations have encountered on their journeys of lean transformation. These narratives serve as a repository of rich insights, offering valuable lessons for practitioners and scholars alike. This section also engages in a comprehensive exploration of the concept of lean transformation sustainability, rooted in the broader context of sustainable organizational change. Building upon this conceptual foundation, the chapter shifts its focus towards the formulation of measurement indicators designed to evaluate sustainable gains in lean transformation endeavors. The concept of lean transformation sustainability underscores the consistent attainment of performance objectives and the enduring capability to derive benefits and enhancements from lean initiatives. Through an in-depth exploration of the measurement of sustainable gains, this chapter aspires to provide insights into the assessment of the efficacy and enduring impact of lean transformation efforts, encompassing both tangible and intangible outcomes.

Key Terms in this Chapter

Lean Transformation: The conversion from traditional operations system to lean operations system. This conversion reflects necessary changes to achieve the gains associated with lean practices.

Convergent Validity: The degree of similarity or correlation among indicators that have been employed to measure the same construct.

Sustainability: The ability to be maintained at a certain level or standard over time.

Lean Pilot Project: The process of installing basic lean elements into the organisation’s operations system.

Sustainable Gains: The ability to persistently acquire benefits and improvements from lean transformation efforts that include both tangible and intangible gains.

Inter-Rater Agreement: The degree of consensus or consistency among two or more raters (experts) in their assessments of a particular measurement instrument. It measures the extent to which multiple raters or judges, who are independently evaluating the same indicators or criteria, provide similar ratings or scores.

Content validity: The extent to which an instrument convincingly appears to assess the intended variable in a logical manner.

Internal Consistency Reliability: The extent to which items within a measurement instrument consistently measure the same construct or attribute. It is commonly assessed using statistical coefficients such as Cronbach's alpha and rho c.

Lean Transformation Sustainability: Maintaining the momentum of lean transformation in organisation’s operations system to achieve persistent performance goals while having consistent direction towards continuous improvement.

Discriminant Validity: The level at which a construct is genuinely different from other constructs, both in terms of its correlation with other constructs and the extent to which its indicators solely represent that specific construct.

Construct Validity: Construct validity is established when a measurement tool consistently and accurately captures a distinct concept. This type of validity encompasses various elements, including content validity, convergent validity, and discriminant validity.

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