Challenges in the transformation to lean production from different manufacturing-process choices: a...

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This article was downloaded by: [Ohio University Libraries] On: 02 October 2013, At: 10:20 Publisher: Taylor & Francis Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House, 37-41 Mortimer Street, London W1T 3JH, UK International Journal of Production Research Publication details, including instructions for authors and subscription information: http://www.tandfonline.com/loi/tprs20 Challenges in the transformation to lean production from different manufacturing-process choices: a path- dependent perspective Patricia Deflorin a & Maike Scherrer-Rathje b a Department of Business Administration, University of Zurich, Zurich, Switzerland b Institute of Technology Management, University of St. Gallen, St. Gallen, Switzerland Published online: 23 Sep 2011. To cite this article: Patricia Deflorin & Maike Scherrer-Rathje (2012) Challenges in the transformation to lean production from different manufacturing-process choices: a path-dependent perspective, International Journal of Production Research, 50:14, 3956-3973, DOI: 10.1080/00207543.2011.613862 To link to this article: http://dx.doi.org/10.1080/00207543.2011.613862 PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the “Content”) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use of the Content. This article may be used for research, teaching, and private study purposes. Any substantial or systematic reproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in any form to anyone is expressly forbidden. Terms & Conditions of access and use can be found at http:// www.tandfonline.com/page/terms-and-conditions

Transcript of Challenges in the transformation to lean production from different manufacturing-process choices: a...

Page 1: Challenges in the transformation to lean production from different manufacturing-process choices: a path-dependent perspective

This article was downloaded by: [Ohio University Libraries]On: 02 October 2013, At: 10:20Publisher: Taylor & FrancisInforma Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House,37-41 Mortimer Street, London W1T 3JH, UK

International Journal of Production ResearchPublication details, including instructions for authors and subscription information:http://www.tandfonline.com/loi/tprs20

Challenges in the transformation to lean productionfrom different manufacturing-process choices: a path-dependent perspectivePatricia Deflorin a & Maike Scherrer-Rathje ba Department of Business Administration, University of Zurich, Zurich, Switzerlandb Institute of Technology Management, University of St. Gallen, St. Gallen, SwitzerlandPublished online: 23 Sep 2011.

To cite this article: Patricia Deflorin & Maike Scherrer-Rathje (2012) Challenges in the transformation to lean productionfrom different manufacturing-process choices: a path-dependent perspective, International Journal of Production Research,50:14, 3956-3973, DOI: 10.1080/00207543.2011.613862

To link to this article: http://dx.doi.org/10.1080/00207543.2011.613862

PLEASE SCROLL DOWN FOR ARTICLE

Taylor & Francis makes every effort to ensure the accuracy of all the information (the “Content”) containedin the publications on our platform. However, Taylor & Francis, our agents, and our licensors make norepresentations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of theContent. Any opinions and views expressed in this publication are the opinions and views of the authors, andare not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon andshould be independently verified with primary sources of information. Taylor and Francis shall not be liable forany losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoeveror howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the use ofthe Content.

This article may be used for research, teaching, and private study purposes. Any substantial or systematicreproduction, redistribution, reselling, loan, sub-licensing, systematic supply, or distribution in anyform to anyone is expressly forbidden. Terms & Conditions of access and use can be found at http://www.tandfonline.com/page/terms-and-conditions

Page 2: Challenges in the transformation to lean production from different manufacturing-process choices: a path-dependent perspective

International Journal of Production ResearchVol. 50, No. 14, 15 July 2012, 3956–3973

Challenges in the transformation to lean production from different manufacturing-process

choices: a path-dependent perspective

Patricia Deflorina* and Maike Scherrer-Rathjeb

aDepartment of Business Administration, University of Zurich, Zurich, Switzerland; bInstitute of TechnologyManagement, University of St. Gallen, St. Gallen, Switzerland

(Received 30 August 2010; final version received 5 August 2011)

The implementation of lean production remains popular among industrial companies, and the requirement forindividualised steps in its implementation is widely accepted; however, research has not yet considered thedifferent process choices available to the companies. The conclusions drawn from the automotive industry’smass production environment may be misleading, given the different conditions of many other industries.We therefore compare case data from a craft producer with the rich, case-study based literature of massproducer companies that highlight the transformation from mass to lean production. We derive a list ofspecific challenges a craft producer must approach using a different strategy than a mass producer. This studyadds to the lean production theory by demonstrating how different manufacturing process choices influencethe lean transformation process and its successful implementation. It provides specific propositionsconcerning the transformation to lean by considering the different processes of craft and mass productioncompanies. Furthermore, the case study gives an in-depth understanding of the challenges a craft-orientedcompany faces when becoming lean.

Keywords: lean production; craft production; mass production; path dependency; case study

1. Introduction

In 2008, Toyota surpassed General Motors, the world’s largest car manufacturer, in global car sales (Bunkley 2009).Taiichi Ohno laid the foundation for this change with his new philosophy and approach to the automotive industry(Holweg 2007, Shah and Ward 2007). Lean has become a widely recognised philosophy that aims to reduce wasteand non-value activities to improve performance in cost-efficiency, conformance quality, productivity, and reducedinventory levels and throughput times.

However, because the lean philosophy stems from the automotive industry, research has predominantly focusedon the mass-producing industry. Nevertheless, the lean production philosophy is currently widely applied globally indifferent industries, such as the process industry (Abdulmalek and Rajgopal 2007), aerospace industry (Ehret andCooke 2010), furniture manufacturing (Hunter et al. 2004), the textile industry (Ferdousi and Ahmed 2010), and theservice industries (Liker and Morgan 2006, Laureani et al. 2010).

Often, existing research analysing the transformation to lean does not consider the initial process choice of thecompanies. Whereas many companies follow a mass production philosophy, some are still structured according tocraft-oriented principles (Cusumano 1991). This is especially true in Europe, where the oldest industrial nations stilladhere to the job-shop philosophy, which is basically a craft manufacturing establishment. Job-shop organisationstypically require many ad hoc adjustments and control is exerted at a low level to flexibly fulfil the required tasks(Gelders and Van Wassenhove 1981, Cusumano 1991). Cusumano (1991) explains the connection between craft-and job-shop: ‘It seems important for supervisors and workers to be highly skilled – hence the label craft seemsappropriate for this mode of operation’. Based on the well-known product/process matrix, production processes canbe divided into four main stages (Woodward 1965, Gelders and Van Wassenhove 1981): job-shop, batch, mass, andbulk. Bulk refers to the continuous production of commodities (e.g. chemicals). Mass production is similar but dealswith discrete products (e.g. cars). Batch production occurs whenever demand is insufficient to enable massproduction. It is still, however, a flow shop, as it goes through the same sequence of operations. Made-to-orderproducts are often produced according to job-shop philosophy where alternative routings for a task may be allowed

*Corresponding author. Email: [email protected]

ISSN 0020–7543 print/ISSN 1366–588X online

� 2012 Taylor & Francis

http://dx.doi.org/10.1080/00207543.2011.613862

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(Gelders and Van Wassenhove 1981). McDermott et al. (1997) highlight the trade-offs when deciding between a job-shop and flow-shop alternative. Based on the differences between craft/job-shop and mass, we believe thatcompanies with manufacturing processes structured according to craft and job-shop philosophy need differentinitiatives to become lean as a mass producer following the flow-shop philosophy.

Only a limited number of studies on lean production have referred to the original process choice of theproduction site, and those few studies mostly investigated a mass-producing environment (Ahlstrom and Karlsson1996, Boyer 1996, Boyer et al. 1997, Womack and Jones 1996, Shah and Ward 2003, 2007, Achanga et al. 2006,de Treville and Antonakis 2006, Liker and Meier 2006, Womack et al. 2007). However, we found discussionsindicating that lean implementation is path-dependent on factors such as culture (Henderson et al. 1999), and thatoriginal setup influences the measures necessary for a successfully implemented transformation (Sheridan 2000).Additionally, Adler and Cole (1993) and Needy et al. (2000) suggest that the conclusions drawn from the pioneeringautomotive industry are misleading because the conditions differ in many other industries. Jina et al. (1997)conducted two case studies analysing whether lean can be implemented in high-variety, low-volume industries andconcluded that the lean manufacturing elements emphasised depend on the specific circumstances of theorganisation. Those circumstances include volume considerations and variety specificities. Lewis (2000) states that acausal linkage between inputs and outcomes must be established for a successful transformation to lean. In ouranalysis, the original processes of a manufacturing company, whether a craft or a mass producer, serve as the inputvariable.

Our research is based on the theory of organisational path dependence (Sydow et al. 2009). Organisationalprocesses (i.e. routines) are shaped over time and define a firm’s choices (Ketokivi and Schroeder 2004). A firm’sspecific asset position therefore shapes its ability to change, specifically its ability to reconfigure its capabilities(Teece et al. 1997). Applying path-dependency assumptions to the lean-implementation literature highlights theimportance of considering every company’s original setup. Our paper is therefore guided by the following question:What are the differences in changing to lean production based on craft or a mass production process?

This article attempts to redress the imbalance of focusing only on mass producers by assessing the challenges ofimplementing lean for a craft and a mass producer. We present the theory of path dependence and a literaturereview on the changes to lean from mass production processes, and we derive the propositions for a successfultransformation. We then present, based on a case study, a craft producer’s transition to lean production and testwhether the propositions derived for mass production are also applicable for a craft production setup. We finish thearticle by concluding that companies’ initial process choices are an important factor for researchers andpractitioners to consider when discussing and analysing the implementation of lean production. The final sectiondescribes the limitations of this study and provides suggestions for how this study may be extended.

2. Breaking organisational paths

History matters – every advanced path-dependency thought stresses the importance of past events for future actions(e.g. Teece et al. 1997). However, the theory of organisational path dependence goes further, as it also includessustained persistency and lock-in (Sydow et al. 2009). Sydow et al. (2009) developed a three-stage model oforganisational path dependence and discussed path-breaking interventions. The first step covers the identification ofstrategic persistence. The existing behavioural pattern is likely to damage the organisation’s future market success.This can be demonstrated with the existence of a superior alternative (Sydow et al. 2009). Companies that strugglewith their present process choice (e.g. craft production or mass production) expect a superior alternative in leanproduction. The second step includes the identification of self-reinforcing feed-back mechanisms, and the third partencompasses the search for the event that sets the path-building process in motion (Sydow et al. 2009). The choice ofa mass or craft production processes was often decided quite some time ago. After the implementation, the processeswere gradually improved over time – leading to self-reinforcing mechanisms. The philosophies of the two processchoices were persistently reproduced, and alternatives were crowded out (Sydow et al. 2009). Thus, the decision tochange to another production environment becomes increasingly more difficult, as it requires high investments andthe creation of new routines. The companies therefore face a lock-in situation.

With the diffusion of lean production, an alternative to craft and mass production arose. Managers faced theneed to deliberately break organisational paths. The above presented theory of path dependence can be a guide tounlocking organisational paths (Sydow et al. 2009). To be able to change, the self-reinforcing patterns ofthe processes have to be interrupted. Only if hidden patterns are identified can they be critically reflected and put

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on the organisational discourse agenda (Kettinger et al. 1997). Therefore, every attempt to change to leanproduction must consider the plant’s current process choice.

3. Transforming to lean: learning from Toyota

Toyota’s success has been widely documented. Despite its recent difficulties, the company has a well-earnedreputation for excellence in quality, flexibility, and cost reduction. Liker’s (2004) book, The Toyota Way, and Likerand Meier’s (2006) practical guide, The Toyota Way Fieldbook, are two widely accepted manuals for lean imple-mentation. Practitioners and researchers extensively apply the authors’ four dimensions (see also Table 1) withinwhich the Toyota management principles are summarised. To become lean, a company must account for each of thefour dimensions of the 4P model: philosophy, process, people and partners, and problem-solving (Liker 2004, Likerand Meier 2006). Although we believe that mass-producing companies face different challenges than a craftproducer in the lean transformation, we believe the aggregated dimensions of the 4P model are still valid. Therefore,we analyse each transformation to lean within these four dimensions. Table 2 highlights literature focusing on thetransformation from mass to lean. We structured the initiatives according to Liker’s (2004) 4P model.

The term philosophy denotes a company’s long-term orientation. As Liker (2004) states, the philosophy atToyota stands for doing the right thing for the company, its employees, the customers and society as a whole.He states that the focal point is not to make money but to generate value for the customers; money followsautomatically if the customers are satisfied. The employees should be confident that their relationship with thecompany is long-lasting so that they will work hard to achieve the best possible results.

Processes are key to achieving the desired results. Therefore, process orientation is a central part of leanproduction and, with it, process flow. Creating flow lowers the ‘water level’ and exposes the problems andinefficiencies that require immediate attention. It is a continuous task to eliminate waste, considering that processescan be composed of nearly 90% waste compared with 10% value added work (Abdulmalek and Rajgopal 2007).

The third dimension addresses people and partners. To create a learning organisation, people and partners mustbe encouraged to think and to grow. The Toyota way does not create a stress-free environment but includes toolsthat aim to bring problems to the surface and encourage people and partners to search for the roots of the problems.

The problem-solving dimension represents the company’s continuous search for the root problems to driveorganisational learning. First, there are always opportunities to learn. Second, when someone learns an importantlesson, they are expected to share it with others facing similar problems so that the company can learn and improve.

The 4P model is, to some degree, hierarchical; the higher levels build on the lower levels. Without a long-termphilosophy, a company cannot implement all the actions necessary for the other three dimensions. Furthermore, theprocesses provide the setting for challenging and developing the employees. This step, in turn, is necessary to createa learning organisation.

4. Lean transformation process of mass producers: insights from existing cases

The following paragraph summarises various researchers’ suggestions on the successful implementation of lean for amass production process choice. We use Liker’s (2004) four dimensions – philosophy, process, people, and problem-solving – to structure these paragraphs.

4.1 Philosophy

The philosophy of a lean company combines the goals of satisfying its customers and building confidence in itsemployees that the established relationships are long-lasting. Bhasin and Burcher (2006) argue that the

Table 1. Four dimensions of a lean transformation (Liker 2004).

‘P’ Theme

Philosophy Long-term thinkingProcess Eliminate wastePeople and partners Respect, challenge, involvement, and growthProblem-solving Continuous improvement and learning

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Table

2.Sample

ofliterature

showingactivitiesneeded

toim

plementleanfrom

amass

producer’sperspective.

Philosophy

Processes

People

andpartners

Problem-solving

Seeingleanasalong-termjourney

Establishingacultureoftrust

Improvingqualitythroughprocessredesign

Establishingprocessstandardisation

throughataktthroughoutallprocesses

tosynchroniseallprocesssteps

Switchingfrompushtopullproduction

Implementingacontinuousimprovementprocess

Implementingaproblem-solvingprocess

Switchingfrommanagementbycontrolling

tomanagementbyhelping

Switchingfrommanagementbydirecting

tomanagementbycoaching

Switchingfrommanagementbyplanningto

managementbylistening

Establishingadequateskillsforleadership

andshopfloortoworkinleanenvironment

Switchingfromemployeeevaluationto

employeeempowering

Switchingfromemployeeexclusionto

employeeinvolvement

Establishingateam-basedworkingculture

Makeshopflooremployeesresponsible

forproblem-solvingprocess

Establishingacultureofcontinuous

improvement

Switchingfromignoringproblemstostopping

theproductionlinetosolvetherootsof

theproblem

Switchingfromignoringproblemstodeal

withthemimmediately

Study

Author

xx

xx

Conceptualwork

BhasinandBurcher

(2006)

xx

xx

xx

Case

studiesonelectronics

conduitmanufacturer

Emiliani(2003)

xx

xx

xx

xx

Case

studiesonautomotive

manufacturer

Liker

andMeier

(2006)

xCase

studyonaerospace

supplier

Liker

andMeier

(2006)

xx

Case

studyonmanufacturer

ofsnow

blowers/lawn

mowers

HartwellandRoth

(2006)

xx

xx

Generalstudyonmass

producers

Noer

(2009)

xx

Case

studyonaircraft

manufacturer

Klein

(1994)

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acknowledgement of lean as a long-term journey is indispensable for a successful transformation to lean production.They further posit that knowledge about the different tools and practices in the lean portfolio is not crucial; rather,it is critical to see the process as a long-term journey that can only succeed with a clear direction, a well-plannedtransformation and an adequately sequenced project. Hartwell and Roth (2006) add that the long-term journey canbe successfully completed only if certain conditions are in place. These conditions include the establishment of anenvironment of trust in which managers follow an information transparency policy and integrate employees of alllevels into the organisation’s decision-making and information-sharing.

In a mass-production environment, employees are not committed to long-term goals. The only task of the shop-floor employees is to perform their given activities as fast as possible without interrupting the process flow (Likerand Meier 2006). Therefore, to address Liker’s philosophy dimension (2004) for mass producers, the followingproposition must be addressed:

P1m The top management of a mass producer needs to change the company’s culture with the goal ofintegrating the employees into a community to change from a short-term orientation to a long-term commitment.

4.2 Process

The second P of Liker’s pyramid, processes, covers the elimination of waste based on high transparency. Liker andMeier (2006, p. 111) state, ‘The establishment of standardised processes and procedures is the greatest key tocreating consistent performance.’

One of the main process changes in transforming to lean is the change in all processes from push to pull (Likerand Meier 2006). Each activity has to pull the next one (Womack and Jones 1996). To ensure a pull system,continuous flow is needed. The takt time is the heartbeat of a lean system. A company’s processes must all follow auniform takt such that each step takes the same amount of time (Liker and Meier 2006). Takt time is defined as theavailable production time divided by the rate of customer demand (Womack and Jones 1996). If each process stepfollows the same takt, bottlenecks in the production process leading to process interruptions can be avoided,and processes can be synchronised. Only if all processes are synchronised, can the product flow. To ensure that thedemanded takt time can be achieved continuously, processes must be as standardised to as great a degree aspossible. With this in mind, we propose the following for a successful transformation to lean production with massproduction processes:

P2m A mass producer must implement standardised processes that follow a uniform takt.P3m Processes must be changed from push to pull.

4.3 People and partners

The third dimension of Liker’s pyramid centres on people and partners, particularly on learning and the developmentof human talent. This dimension should be separated into two categories: the behaviour and skills of white-collar andblue-collar workers. For white-collar employees (i.e. management and employees in leading positions), a mass-producing company should move away from directing employees in favour of helping coaching and listening toemployees (Noer 2009). Blue-collar workers (i.e. shop-floor employees) should be empowered; moving away fromrepetitively fulfilling a given task to actively improving processes or machine equipment (Klein 1994, Bhasin andBurcher 2006, Liker and Meier 2006, Noer 2009). Therefore, responsibility must be promoted as far down thehierarchical ladder as possible (Womack et al. 2007). To obtain the necessary background to make adequate decisionsand take on the required responsibilities (Liker and Meier 2006), blue-collar workers need to be involved in theinformation flow (Emiliani 2003). They need training in job rotation and in additional tasks that were not relevant in amass-producing environment. These tasks may include housekeeping, quality-checking, and simple machine repairs.Management, on the other hand, needs the skills to implement and change the firm’s leadership style. Overall, themostcentral message in the people and partners dimension is the importance of teamwork. Klein (1994) and Emiliani (2003)observed the difficulty of transitioning from mass production, where people work in isolation, to a team-basedworking culture. Mass producers often have factory employees who know only one production step.

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To conduct our analysis, we derive the following propositions to be tested in the transformation from a craft to alean production company:

P4m The employees of a mass producer need additional skills that enable them to conduct severalprocess steps that contribute to the firm’s success in transforming to lean.

P5m A mass producer needs to involve all employees from shop-floor to management in problem-solving to transform to lean.

P6m A mass producer should teach its employees a variety of skills, such as simple machine repair,quality-checking, and material ordering.

4.4 Problem-solving

Problem-solving addresses one of the biggest goals in lean production: to eliminate the root causes of problems.To enable employees to begin searching for these causes, the company must establish a culture that supportscontinuous improvement (Emiliani 2003, Bhasin and Burcher 2006, Hartwell and Roth 2006, Liker and Meier2006). The goal is to promote problem-solving skills and, as a result, to learn and grow as an organisation. People’sbehaviour must change from ignoring problems to stop the production line, and finding and solving the root causesof the problems (Liker and Meier 2006). Liker and Meier (2006) state that this task is crucial, as employees in mass-producing companies have never had to problem-solve before. A mass producer’s primary aim is to promote stableprocesses and to eliminate the sources of mistakes that endanger this stability; thus, no active problem-solving isundertaken. Womack et al. (2007, p. 30) state,

. . .workers wouldn’t volunteer any information on operating conditions – for example, that a tool was malfunctioning –much less suggest ways to improve the process. These functions fell, respectively, to the foreman and the industrialengineer, who reported their findings and suggestions to higher levels of management for action.

In order to be able to transform to lean, a mass producer needs to implement two processes:

P7m A mass producer must implement a continuous improvement process to transform to lean.P8m A mass producer needs to implement a problem-solving process to transform to lean.

To understand the influence of the starting position (mass or craft), we test the derived measures on the data of acraft producer transitioning to lean production.

5. Methodology

To compare the different challenges that craft and mass producers face, we adopt a dual approach. First, weexamine a mass producer’s original process choice and possible trajectory to lean production. In agreement withLewis (1998), we believe that existing case studies offer an efficient and effective means for comparing complexoperating settings (Lewis 1998). Womack et al. (2007) among others have provided numerous examples of thestarting position of a mass producer and the transition process to a lean producer. Second, we use a single case studyto obtain data on a craft-producing company and compare the data with existing data from the literature on mass-producing companies (Eisenhardt 1989, Yin 1994, Punch 1998, Stuart et al. 2002, Eisenhardt and Graebner 2007).This approach allows an in-depth understanding of a craft-producing company’s situation and its challenges inbecoming a lean producer.

5.1 Data collection

This study’s sample is a manufacturing company, a leading European manufacturer of food-processing plants andequipment that traditionally operated as a craft producer. The company agreed to allow two researchers to observeits transformation process to lean. To ensure the change process was not disrupted and to gather as much data aspossible, we used a field-based interview technique. The analysed company, hereafter referred to as Machinery Inc.,generated annual sales of over E1.2 billion (US$1.6 billion) in 2009. Worldwide, the company employsapproximately 7500 people, of whom 3000 are located at its headquarters in Switzerland.

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We conducted 20 interviews in the company with members representing different functional areas andhierarchical levels. We selected the interviewees based on their involvement in the lean transformation project andconducted the interviews in value-adding processes such as production, quality management, logistics, and customerservice. We were able to interview members from all hierarchical levels, including two members of the board, variousfunctional managers and assembly workers on the shop floor. Additionally, we conducted interviews in supportprocesses such as finance and controlling, informational technology, and procurement. We also interviewed thedirector of a business unit where lean was implemented.

The interviews were semi-structured. To improve the validity of our results, we applied the recommendationsof Dilman (1978) and Oppenheim (1992) to our design of the interview guideline. They recommendedconducting a comprehensive literature review to design questions. Additionally, we discussed the questions withan independent academic from the field of lean management. Our development of the research protocol wasguided by our research interests and the relevant literature. The interview guideline is presented in theAppendix.

Each interview lasted approximately 1.5 h and was taped and transcribed. After each round, the researcherscompared notes and impressions. Following Eisenhardt’s (1989) rules, we developed detailed interview notes within24 h, included all data from the interview, and concluded each set of interview notes with the researchers overallimpressions. To enhance the accuracy and minimise the limitations resulting from relying on retrospective data, wefollowed Miller et al.’s (1997) procedure. First, we used free reports, allowing members to not answer the question ifthey did not remember clearly. Second, we verified individual reports by asking the same questions to multipleparticipants. Third, if verification was needed, we recalled the first interviewees to validate the new information.Finally, we supplemented interviews with secondary data, such as internal memos, minutes, and documentationsconcerning the change to lean production.

In addition to the interviews, the researchers conducted three site visits, including tours lasting approximately 1 heach and two discussion sessions in the business unit. The aim of these visits was to experience, first hand,information transparency issues and to observe how the problems associated with current lean efforts wereaddressed. By conducting site visits and attending discussion sessions, we were able to observe company practices,verify the issues and changes discussed in the interviews, and better understand how employees were coping with theimplementation of lean and its associated changes.

5.2 Data analysis

Following Miles and Huberman (1994), our data analysis proceeds through four steps. First, we developed a contactsummary sheet to record the main themes from each interview (Miles and Huberman 1994). One researcher wasresponsible for identifying the main themes, whereas the second researcher crosschecked it with the transcripts.A theme was defined as an interviewee’s central ideas (Dutton and Dukerich 1991). For example, the functionalseparation during the craft-oriented production period and the implementation of the ‘just-do-it room’ to overcomethe functional separation were common central ideas. Second, based on the contact summary sheet, we constructeda complete theme list. To focus on the main drivers, we focused our research attention on the themes most oftenmentioned. Unique themes, reported from only one or two interviewees, were omitted. Additionally, the resultingthemes were connected to Liker’s four Ps. The third step covered the coding of the interview. We used selectivecoding (Corbin and Strauss 1990) and coded quotations into the themes and the four Ps. One researcher wasresponsible for coding a single interview transcript, whereas the second researcher cross-checked the coding. Reviewand discussions between the two researchers continued until agreement was reached. If no agreement was achieved,the interviewees were asked for clarification. This procedure allowed checking for inter-rater reliability (Voss et al.2002). The fourth step covered the writing of the case study. The procedure concluded with the final validity checkas we presented the result to the director of the business unit. Only two minor details about the timeline of initiativeshad to be adapted.

6. Lean transformation process of a craft producer: insights from Machinery Inc.

6.1 Original processes

Machinery Inc. produces customised machines from four main machine families. Customers can define theirrequired specifications or alterations based on standard modules. To fulfil these diverse customer requirements, the

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shop floor of Machinery Inc. was, prior to lean implementation, mainly organised in a cell-based layout that was

dominated by craft production. The working cells were assigned to one of the four main machine families that the

company produces. The individual cells of one machine family were focused according to metal sheet specifications.

A machine was produced in one cell from start to finish by a team of two to three employees who worked solely in

this respective cell. In the middle of each cell was the machine that was to be finished. Around the machine, work

places for different activities such as bending, shaping, stamping, bolting, etc., were arranged. The components to be

assembled on the machine were prepared in these work places and finally assembled. Within the cell, alternative

routings for a task were allowed, and with this, no coordinated flow existed. Each cell contained an inventory with

semi-finished goods, components, raw materials, and consumables. The overall production plan was organised in

weekly steps. Each cell was autonomous with respect to planning the production for the weekly orders.

The responsible person for the cell usually organised similar orders in batches. When all weekly orders were finished,

semi-finished goods or components were produced to put on stock for later use.The employees were highly skilled and able to handle all the required tasks within one cell. This structure created

a culture of traditional craftsmanship; the employees cared about the quality of the end products in their cells and

took pride in solving engineering-related problems. The cells were supplied with different half-products. These half-

products were often stored as the processes were not synchronised. There was no defined volume or product-mix,

but each process owner optimised output according to his own schedule. Therefore, long waiting times occurred if

the needed part was not in stock. Although the customer order started the work within the cells, the whole

production process was not organised according to the pull principles. Pull dictates when material is moved and who

determines that it has to be moved (Liker and Meier 2006). Three main principles distinguish pull from push (Liker

and Meier 2006): defined agreement with respect to what to deliver; resources, space, etc. must be dedicated; and the

agreement has to be controlled (physically and visually). The cells, as used at Machinery Inc., were only

organisational cells that grouped workers together to produce one machine. Pull-principles were not applied.The information flow within the work cells was highly efficient because the employees were working closely

together. Process improvements had previously been discussed by the shop-floor employees of one cell and

implemented directly into the work cells. However, information was often not shared outside the cell, and functional

separation hindered the improvement of products and processes.Although management was satisfied with the company’s development, several serious problems had to be

addressed. For example, the employees in the production department struggled when faced with a 100% increase in

orders. Machinery Inc. had never experienced an increase in this magnitude and the business unit’s management did

not know how to respond and handle such a large quantity of orders. Thus, customers were told thatMachinery Inc.

had a delivery delay of up to 12 months. After having attended a lean-production seminar and having heard about

other success stories within Switzerland, the CEO and the top management were convinced that a pull system, seen

as part of lean production, was necessary for the company to remain competitive. The launch meeting for the lean-

implementation project was held in November 2006. The transformation project from craft to lean was initially

implemented in one business unit of Machinery Inc. If the implementation in the first business unit proved

successful, it would be followed by the implementation of lean in the other business units.The first goal toward lean was to implement a pull system. A pull system is an aggregation of several elements

that support the concept. Such supporting systems include Kanban, visual control, and standardised work (Liker

and Meier 2006). The transformation to pull and, finally, to lean in the first business unit began with the rebuilding

of the manufacturing process to implement a two-bin system. In doing so, the plant setup and the resulting processes

were changed significantly, establishing boundaries to keep employees from reverting to the old way of doing things.

In the two-bin system, two parties work on the same production step. One party arranges the required tools and

parts on a tray, and the second party performs the production tasks on the product. After the task is complete, the

parties exchange roles. The company then implemented a long cycle time. The first cycle time was the time the

responsible employees estimated they had to complete the task. One cycle lasted 2–3 days within which a certain

number of defined production steps had to be completed. The cycle time was progressively reduced as the employees

gained more and more experience, finally cutting the time to between 3 and 4 h. After the employees adjusted to this

shorter cycle, the cycle was substituted through synchronised process steps that had the same lead time. Here, the

tasks were defined to be conducted in 1.5 h each. All process steps within Machinery Inc. follow this takt today.Visualisation was also an important issue. Between each process step, an open space was implemented. If the

space is free, the prior process step has permission to produce the next item on schedule. The production process

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now follows the pull principle – spanning all processes. For example, the last process step dictates what to do (buildthe next product on schedule) and when to do it (when the space is empty between the two process steps). With thisprinciple, inventories decreased, and the production process was aligned with customer orders. In addition to thereduction in inventories, throughput time was lowered. The company, therefore, experienced a clear advantage fromthe implementation of pull.

Along with the synchronisation of processes, the so-called ‘just-do-it’ rooms were established for team meetingsto ensure adequate information flow. Representatives from every process (e.g. production, procurement, qualitycontrol, logistics, and finance and accounting) meet daily to discuss ongoing orders (Scherrer-Rathje et al. 2009).These meetings ensure that problems with customer orders are discussed as soon as they occur.

7. Challenges encountered during the change from craft to lean

The interviews with the employees revealed several challenges the company faced during the transformation processowing to their craft-related orientation. These issues are discussed in terms of Liker’s (2004) four dimensions:philosophy, process, people and partners, and problem-solving.

7.1 Philosophy

Our analysis of Machinery Inc.’s philosophy revealed that it was necessary to change its employees’ mindsets.Historically, Machinery Inc. had clear hierarchical levels. Although employees were motivated to solve technicalproblems, they were not required to share the issues with other employees or to identify the root causes. Thetransformation, however, shifted the responsibilities as far down the hierarchical ladder as possible. The employeeshad to learn to accept responsibility and become self-reliant not only for the problem at hand but also for makingsure that the problem did not occur again. Machinery Inc. installed a ‘just-do-it room’ where responsible teammembers had to discuss the problems at hand. Responsible employees from each process step have to be present,and a solution is jointly searched for directly in the ‘just-do-it room’. Postponements of decisions are not accepted.If the problem cannot be solved directly in the ‘just-do-it room’, responsibility is given to one employee out of thepresent employees in the ‘just-do-it room’ to have a solution ready at the next meeting. Employees from differenthierarchical levels and functions are present in the room. The position in hierarchy is not crucial in being selectedas a member of the ‘just-do-it room’; however, the ability to contribute expertise to the discussions is important.With this approach, Machinery Inc. showed its employees that the company trusted them. This, in turn, motivatedthe employees to care not only about their work but about the products and the company.

7.2 Processes

A central goal of a lean producer is to reduce waste in every process. The processes at Machinery Inc. were changedcompletely. In craft production, strong boundaries exist between functions. For example, R&D employees do notspeak to manufacturing employees; marketing employees do not speak to sales employees. Every functionalimprovement was performed independently, and no information transparency about what had been communicatedto the customer existed. During the transformation to lean, all processes were synchronised, interfaces were defined,co-working between functions was established, and the ‘just-do-it room’ was installed to reduce boundaries betweendepartments and functions, and to increase information transparency. Customer orders and punctual deliveriesbecame the centre of interest; all other processes became supportive. In a craft-production environment, theemployees had a high degree of freedom in performing their assigned tasks; therefore, the same tasks were oftenexecuted in different ways. Furthermore, it was quite common to solve problems ad hoc, which was not helpful inachieving process transparency. An important concern encountered during the transformation was the lack ofstandardised and updated bills of material. Each cell handled changes differently. Because lean production requiressynchronised and standardised processes, the harmonisation of the different bills of material was of criticalimportance. Historically, process flow was not an important concern at Machinery Inc. If problems occurred with acustomer machine, it was put in an area where all machines with supplier delays or unsolved problems were stored.In this area, the machines were out of sight. The production of the next machine was begun. This meant that solvingthe problems of the stored machines was postponed indefinitely. As a result, problems with the stored machines

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were not resolved until the customer complained, which sometimes took up to one year. A procurement employeenamed the storage area ‘the petting zoo of Machinery Inc.’ and described the situation as follows:

Every machine waiting for a certain part or a solution for an unsolved problem was put in the petting zoo. In thebeginning, the area was in the middle of the production hall. After some time, the petting zoo was moved to a warehouseand with this, out of sight. From then on, the production area always looked clean. It was comfortable not to be remindedof the open tasks every time we walked into the production area.

Having a full production schedule, employees had many excuses for why the machines in the petting zoo werenot taken care of. Although some customers were lost owing to long delivery delays, the full production scheduleprevented any escalation of the problem from top management. With the implementation of lean, this storage areawas considered waste and eliminated. This means that if a problem with an end product occurs today, it must besolved immediately. Each problem is discussed in the ‘just-do-it room’, where different functions meet. If, forexample, a part is missing, the procurement employee of the ‘just-do-it-team’ must bring forth an immediatesolution for providing the necessary part to the shop floor. As every production process of an end product isdiscussed in the ‘just-do-it room’ on a daily basis, the missing part would probably have been discovered earlier.However, if necessary, it is better to stop the production process until the problem is solved than to store and ignorean unfinished machine. Machinery Inc. had to remove the ad hoc processes commonly observed in craft-productionenvironments and establish transparent and standardised processes in their place.

7.3 People and partners

The implementation of lean clearly changed the working tasks of many employees at Machinery Inc. The employeeswere trained with certain skills and had, at the same time, gathered a high level of tacit knowledge for their assignedtasks. Most employees learned their skills in an apprenticeship at Machinery Inc. They refined their skills over theyears and became experts in their fields. The change to lean involved the same workers, but now they were beingasked to perform repetitive and structured tasks rather than the broader field of tasks to which they had becomeaccustomed. During the transformation process from craft to lean, an assembler stated:

We were quite frustrated. During the implementation process of lean we realised that our work will become boring.We were proud to work on one machine for a certain customer. We identified ourselves with the customers we wereproducing machines for. After lean was implemented, our tasks became more structured. We lost the pride of working forspecific customers because we had to conduct a decreased number of steps repetitively instead of producing the wholemachine within the same cell.

The leader of international projects added, ‘We have never been a mass-production company. We did not like itif someone told us how fast we had to build the machines. It implies that we did not do our best in the past’.

With the implementation of lean, the firm required different tasks from its employees. They had to be generalistsrather than experts in a specific task. In lean production, cross-trained teams of workers and their achievements,rather than single employees, become the centre of interest. The challenge at Machinery Inc. was to motivate theemployees to work in what they perceived to be a less attractive environment, which could be counteracted by whatthey would hopefully see as new and challenging responsibilities. To motivate shop-floor employees, the employeeswere given the responsibility to continuously improve their processes and working environment. Each improvementor problem solved is demonstratively visualised on the job floor. The improvements achieved, such as inthroughput-time reduction, were displayed and continuously shared with all employees to keep the motivation high.Additionally, the employees were given a high degree of freedom to create their new working place according to thelean philosophy. During this time of change, the employees had the possibility to solve inconveniences that theyhave been complaining about for several years. Many of the inconveniences often complained about could be solvedduring this time of change.

7.4 Problem-solving

Although continuous improvement was always a goal ofMachinery Inc., the firm’s approach changed after lean wasimplemented. Machinery Inc. was one of the first companies in Europe to implement a continuous improvementprocess. As the project leader of organisational projects summarises, ‘We received a bonus for every error wereported. The goal was never to analyse the sources of the errors and eliminate them but to find the personresponsible for an error and blame this person’.

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An assembler recalls that the successful implementation of the first continuous improvement activities wasdifficult, as standardisation was lacking. Therefore, the identification of the root cause was difficult, as processesand tasks were often performed and completed differently, according to the employee’s experience.

The above example suggests that the continuous improvement process in place was not useful. To improveexisting processes, a permanent standardised continuous improvement process is necessary. In addition, a problem-solving process where roots of errors and inefficiencies are discovered and eliminated is required. In the newcontinuous improvement process, Machinery Inc. faced the challenge of establishing a standardised process whereemployees had to discover real process improvements instead of just blaming other employees if something did notwork or solve problems ad hoc. Based on their experience of the previous continuous improvement process, theemployees were quite reluctant to participate in continuous improvement initiatives. The new continuousimprovement process is based on a team effort to improve processes within and between functions. The visiblechanges at the shop floor were one of the key drivers of the employees to support the new continuous improvementinitiative. Additionally, the ‘just-do-it room’ and the displayed improvement suggestions on the shop floor helpeddemonstrate that the new initiative was reasonable and different from the traditional improvement process.Additionally, a standardised problem-solving process with root-cause analysis methods was implemented toeliminate the occurrence of the same error more than once.

8. Discussion of the path-dependent differences

The following section compares the challenges that mass producers and craft producers face in the transformationto lean. The differences are highlighted according to Liker’s (2004) pyramid (philosophy, processes, people andpartners, and problem-solving).

8.1 Philosophy

To achieve a long-term philosophy with the goal of being a value-adding contributor, the learning enterprise is acentral concept. The actions needed to achieve this goal vary between the two different setups. The philosophy of amass producer is to focus on the fulfilment and improvement of short-term efficiency goals. As summarised in P1m,the culture of a company needs to change so that employees move from thinking short term to thinking long term.Similar to Toyota, Machinery Inc. succeeded in developing a community. A substantial part of the labour base hadbeen with the company for more than 20 years. The achievement of long-term goals is as important as theachievement of short-term goals. However, as the case-study analysis reveals, the company cannot call itself alearning organisation. For example, the implementation of a continuous improvement activity failed because theneeded standardisation was lacking. Employees did not look for real process improvements but blamed otheremployees for errors and called this continuous improvement. With this, no real improvements were achieved, andthe findings could not be shared with other employees of the company in a standardised way. To summarise, even ifa long-term culture is present within the company, it is the learning organisation that is missing.

For the craft producer, we propose the following:

P1c The top management of a craft producer must change the company’s culture with the goal ofcreating a learning organisation to support the firm’s long-term orientation.

8.2 Processes

The standardisation of processes is one of the greatest keys to creating consistent performance. One of the maindifferences of the transformation to lean between a mass producer and a craft producer can be summarised withstandardisation. The goal of a mass producer is to have as many interchangeable parts as possible (Womack et al.2007). As the case ofMachinery Inc. indicates, the workers had a high degree of freedom in finishing their work, andprocess improvements were done ad hoc. Problems were solved, but because of the lack of standardisation, thesolutions could not be shared between processes. Until standards are defined, it is not possible to make lastingimprovements. Based on its background as a craft producer, Machinery Inc. was in great need of standardisation(see also the Lantech case study of Womack and Jones (1996, p. 122)). This issue was apparent in the example ofthe non-standardised bills of material; it is not possible to make lasting improvements without standardisation

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(Liker and Meier 2006). We do not suggest or imply that mass producers do not face difficulties in thestandardisation of processes. However, craft producers face different challenges that need to be approacheddifferently. Whereas a mass producer only has to synchronise the already standardised processes to a takt, a craftproducer has to establish standardisation from the ground up. Therefore, we propose the following for a craftproducer:

P2c The implementation of lean in a craft-producing company requires thorough efforts to promotestandardisation.

A mass producer’s transformation to lean requires the transition from a push to a pull system. Craft-producers’processes suggest that, even though the production process starts with a concrete customer order, the order is stillpushed down the production line. Traditionally, many of the standard half-products were produced according to thepush philosophy and put on stock until needed. Implementing lean and pull needs the synchronisation of allprocesses and the avoidance of stock. Each of the processes only starts if the prior process is ready to overtake thematerial (Womack and Jones 1996). While at first glance Machinery Inc. appears to have a pull system, most of theprocesses begin when the respective machine is idle or the worker is running out of orders. Semi-finished productsare always produced on stock for later use if the different cells have free capacity instead of when a customer orderrequires the production of these semi-finished goods. Therefore, propositions P3m and P3c are identical.

P3c Processes must be changed from push to pull.

8.3 People

The third level of Liker’s pyramid, the people perspective, includes issues such as employee involvement,responsibility, and teamwork. Every single employee is responsible for the company’s success. To fulfil thecompany’s quest for involvement, responsibility, and teamwork, employees must possess the respective skills.The people perspective includes the need for training. This perspective shows some interesting differences.

Whereas a mass producer’s employees often only perform one production step, a craft producer has a workforceof highly skilled employees at the factory level. The employees learn their skills in an apprenticeship and refinethem over time. From these different starting points, the transition to lean production has different challenges.Employees who work in a mass production company are suddenly required to understand more than oneproduction step. Craft producer employees face the demand to work in a more repetitive way than before. As thecase study of Machinery Inc. shows, craftsmen are reluctant to follow highly standardised procedures. Theseexamples reveal that proposition 4m is not applicable to craft producers and should be modified.

P4c The employees of a craft producer need to follow more repetitive and highly standardisedprocedures to succeed in transforming to lean.

Another difference between mass and craft-producing settings concerns the employees working on the shopfloor. The involvement of the employees at a mass producer is exceptionally low. Often, a special workforce isresponsible for solving problems. In contrast, if a problem occurs atMachinery Inc., the highly skilled employees tryto solve it ad hoc, often without seeking out the source of the problem. Ad hoc problem-solving is often conductedinside one function (see also the Lantech case study of Womack and Jones (1996, p. 107)). Nevertheless, to preventrepetitive mistakes, people involvement and the sharing of solutions should span multiple cells and functions.For example, the knowledge about root causes stemming from design engineering should be transferred to otherdesign teams to prevent similar inefficiencies. In summary, a mass producer needs to involve all employees fromshop floor to management in the problem-solving process, but a craft producer needs to overcome functionalbarriers. This conclusion leads us to reformulate proposition 5m:

P5c A craft producer needs to involve employees from different departments and functions toovercome isolated problem-solving activities.

At the heart of a lean-production company is a dynamic work team. Flexibility in employee assignments iscentral to lean production. To transform a firm from mass to lean, Womack et al. (2007, p. 99) stated:

. . .workers need to be taught a wide variety of skills – in fact, all the jobs in their work group so that tasks can berotated and workers can fill in for each other. Workers then need to acquire many additional skills: simple machine repair,

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quality-checking, housekeeping and materials-ordering. Then, they need encouragement to think proactively so that theycan devise solutions before problems become serious.

Machinery Inc.’s challenge in transforming to lean is different. The employees are already highly educated andflexible in their job activities. Even though the employees have the skills to solve technical problems, problem-solving capabilities need not only the ad hoc identification of problems but the search for the root causes and actionsthat prevent similar mistakes. Additionally, the findings must be shared. The employees of a craft-oriented companytherefore need to increase their capabilities with respect to identifying the root causes of mistakes and eliminatingthem. A process is improved not by blaming other employees but by analysing the process and finding theinefficiencies that must be addressed. Hence, the employees must be trained in other areas to strengthen thecontinuous improvement process. These skills build the foundation for achieving the fourth level of Likers pyramid.

The examples show that a craft and a mass producer differ in their employee training requirements. Whereas massproduction employees need to build up additional skills, the employees of a craft producer need to adapt their existingskills to new applications. Therefore, proposition 6m is not valid for a craft producer seeking to transform to lean.

P6c A craft producer’s employees need to enhance their problem-solving capabilities to solve theproblems in a standardised way and adapt their skills for finding process inefficiencies and sharethem with other employees.

8.4 Problem solving

The last dimension of Liker’s pyramid, problem-solving, includes continuous improvement activities and problem-solving. At Machinery Inc., the continuous improvement programme in place has often been misused to blamemistakes on other employees. To support the lean philosophy, the company must implement a standardisedcontinuous improvement process. The standardised continuous improvement process supports employees in theirongoing tasks to improve processes. Additionally, the process should foster the sharing of improvements within thecompany. Whereas a mass producer has to implement continuous improvement processes from scratch, a craft-oriented company has to adapt existing processes.

P7c A craft producer must implement a continuous improvement process where improvements areshared within the company.

In a mass-production environment, problem-solving skills are not existent at factory level; however, the casestudy of the craft production company suggests otherwise. Although the employees of Machinery Inc. do possessproblem-solving skills, these skills are not used systematically. Problem-solving activities are often focused ontechnical problems more than they are on root-cause analysis. Furthermore, due to low process standardisation, thesolution for one process often cannot be adapted to another, although the cells have similar processes and couldprofit from the improvements. In summary, a mass-producing company has no problem-solving process at all, whilea craft producer has a problem-solving process installed, but it does not reflect lean philosophy.

P8c A craft producer must implement a standardised problem-solving procedure to transform to lean.

9. Conclusion

The literature on the implementation of lean production is often implicitly or explicitly focused on thetransformation from mass production to lean. This focus is based on lean production’s origin in the automotiveindustry where mass production was common. In our research, we asked if companies with a craft productionorientation and mass producers face similar challenges during the transformation to lean. Based on the case studyand literature analysis, we find that there are many differences that must be considered during the transformation tolean production. These differences include people involvement, process standardisation, changes in behaviour,problem-solving, mistake handling, and differences in work tasks.

The comparison of the transformation to lean from a craft- or a mass-oriented company reveals that the specificasset position of a company influences its necessary steps in the transition to lean production. This supports thepath-dependency theory as concrete activities are needed to break up the lock-in effects. Based on the three-stagemodel of the path-dependency theory (Sydow et al. 2009), it becomes clear that a company transforming to lean

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requires path-breaking interventions. Companies must identify the self-reinforcing feedback mechanism to

overcome the lock-in situation. The transformation ofMachinery Inc. has shown that different initiatives are needed

to overcome the lock-in situation and to transform to lean. For example, Machinery Inc. had to overcome the

employees’ negative experiences with continuous improvement initiatives. Only the knowledge of the company’s

history allowed for the creation of concrete initiatives. We therefore strongly suggest that the path-dependency

theory be applied in research on the implementation of the lean philosophy.Future research should take the differences between craft and mass production into consideration to avoid

generalisations that are only suitable for one type of production process. As a starting point for further research, we

derived eight propositions: which are summarised in Table 3.For practitioners, the results show that managers of a craft production site have to be cautious when adopting

lean implementation procedures. The original process choice differs from a mass-production company; thus

management must be aware of the challenges that need to be addressed differently. Only if the self-reinforcing

feedback mechanism to overcome the lock-in situation can be identified is a successful transformation to lean

possible. Therefore, the propositions derived are a useful guideline for managers facing a transformation to lean.

Furthermore, we strongly believe that future studies of the success factors in lean-production implementation

should include a company’s original process choice, which would allow the management of both kinds of

production to be aware of the specific challenges. Additionally, managers can profit from the challenges and

learning that our case study highlights.In the study at hand, the external partner perspective has not been included. Further research needs to be done to

analyse whether the supplier management in the transformation to lean from craft- or mass-orientation differs.

Additionally, further research attempts lie in testing the derived propositions in various industries and geographical

regions. With this, the new research results can overcome the limitations that generalised results are not generated

by our single case study. Such research would help to identify the success factors of a transformation to lean without

neglecting a company’s background. Many companies are only at the beginning of the transformation to true lean

production, and studies with the above-mentioned information would help them to succeed in this transformation

process.

Table 3. Transformation to lean from mass- and craft-production process choices.

Proposition Mass producer Craft producer

1 The top management of a mass producer needs tochange the company’s culture with the goal ofintegrating the employees into a community tochange from a short-term orientation to a long-term commitment

The top management of a craft producer mustchange the company’s culture with the goal ofcreating a learning organisation to support thefirm’s long-term orientation

2 A mass producer must implement standardisedprocesses that follow a uniform takt

The implementation of lean in a craft-producingcompany requires thorough efforts to promotestandardisation

3 Processes must be changed from push to pull Processes must be changed from push to pull4 The employees of a mass producer need additional

skills that enable them to conduct several processsteps that contribute to the firm’s success intransforming to lean

The employees of a craft producer need to followmore repetitive and highly standardised proce-dures to succeed in transforming to lean

5 A mass producer needs to involve all employees fromshop-floor to management in problem-solving totransform to lean

A craft producer needs to involve employees fromdifferent departments and functions to overcomeisolated problem-solving activities

6 A mass producer should teach its employees a varietyof skills, such as simple machine repair, quality-checking, and material ordering

A craft producer’s employees need to enhance theirproblem-solving capabilities to solve the problemsin a standardised way and adapt their skills forfinding process inefficiencies and share them withother employees

7 A mass producer must implement a continuousimprovement process to transform to lean

A craft producer must implement a continuousimprovement process where improvements areshared within the company

8 A mass producer needs to implement a problem-solving process to transform to lean

A craft producer must implement a standardisedproblem-solving procedure to transform to lean

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Appendix

Open Questions

– Please describe the organisational form prior to the lean implementation:

– Philosophy– Processes– People– Problem-solving

– Do you think the organisational form is critical to succeed in lean implementation?– Please describe the main processes.– Why did you choose a craft oriented process form in the first place?– What were the reasons to change from craft to lean?– How was the change conducted in the following for categories:

– Philosophy– Processes– People– Problem-solving

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– What are the key items learned from the process change?– What actions do you take to keep lean sustainable in place?

– Philosophy– Processes– People– Problem-solving

– Which stage of implementation did you achieve?

Source: based on Womack and Jones (1996)

– Prepare

– Build vision– Get lean knowledge (all key leaders)– Make the commitment (top managers in the business unit and senior managers)– Find a change agent (leader and potential consultant)– Define initial implementation scope (a whole process; a business unit; others)

– Get started

– Map your value stream– Chart product and information flow– Collect baseline data (cost, schedule, quality)

– Design production system

– Develop a future state value stream map– Identify tact time requirements– Plan new layout– Integrate suppliers– Design visual control system– Plan TPM system

– Implement business system– Complete the transformation and strive for improvements– Closed questions– Which elements of lean did you implement?

– Six sigma quality– Visual display– Defect prevention– One-piece flow– Pull system– Kanban– Work cells– Single-minute exchange die (SMED)– Quality at source (JIDOKA)– Just-in-time supply (JIT)– Efficiency of motion & workplace practices– Value analysis– Value stream mapping– Total quality management (TQM)– Total preventive maintenance (TPM)– Kaizen (Continuous improvement)– Poka-yoke– 5S– Design for manufacturing and assembly (DFMA)– Supplier management– Quality function deployment (QFD)– Others (please specify)

– Critical success factors for lean implementation

Source: Achanga et al. (2006)

– The most critical success factor (CSF): Leadership & Management, Strategy and Vision

– Clear strategy and objectives for change

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– KPIs for measuring the impact of change initiatives– Scoping and tailoring the intervention– Planning, organising and resources for the intervention– Preparing and finishing the intervention– Unfolding the intervention in a connected, coherent manner– Motivation for lean internal or external driven– Benchmarked companies– Lean– Strategy broken down to cell level– Senior management involvement– Senior management commitment

– Supportive Elements of CSF: Organisation, Culture, Employees

– Organising, Human Resource Management and resources for change– Organisational (cultural and political) readiness for change– Stakeholder management– Developing Lean champions– Person with a significant per cent time responsible for lean activities– Documentation of shop-floor problems for continuous improvement– Graphs to monitor current status and guide further improvement activities– Do operators have a high level of decision-making?– Availability documented process– Training for front line workers concerning problem-solving– How get problem-solving process started?

– Supportive Elements for Implementation: Support Technology

– How did the technologies support the lean implementation?

– ERP– SCM– CRM– E-Procurement– Others

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