Lean, Six Sigma and its influence on potential and realized absorptive capacity

Abstract

Purpose The purpose of this paper is to explore how Lean and Six Sigma’s distinctive practices relate to potential absorptive capacity (PACAP) and realized absorptive capacity (RACAP). The paper seeks to understand which of the practices in Lean Six Sigma are needed to manage absorptive capacity systematically. Design/methodology/approach Partial least square based structural equation modeling (PLS-SEM) was used to test the theoretical model drawing on a sample of 125 manufacturing organizations in Malaysia. In addition to examining direct effects, the study also examines indirect effects using bootstrapping method to identify possible mediation effects proposed in the model. Findings The results explain that Lean’s social practices (LSP), Six Sigma’s roles structure (RS) and structured improvement procedure (SIP) positively influence potential absorptive capacity (PACAP). Meanwhile LSP, RS and focus on metrics (FOM) positively influence realized absorptive capacity (RACAP). SIP was found to influence RACAP through PACAP. The analysis reveals the combination of Lean Six Sigma practices that are required in managing PACAP and RACAP differentially. Research limitations/implications The study is only confined to manufacturing industries in Peninsular Malaysia. Data collected were cross-sectional in nature. The application of Lean Six Sigma and how it influences absorptive capacity may get sturdier across time, and this may change the effect toward sustainability of firm’s competitive advantage. A longitudinal study may be useful in that context. The study also makes specific recommendations for future research. Practical implications The results of this study can be used by Lean Six Sigma practitioners to prioritize the implementation of Lean Six Sigma practices to develop absorptive capacity of the organization through PACAP and RACAP, which needs to be managed differentially as they exert differential outcomes. This would enable organizations to tactfully navigate and balance between PACAP and RACAP in accordance to business strategies and market conditions. Originality/value Absorptive capacity in Lean and Six Sigma context has largely been studied as a unidimensional construct or used as a grounding theoretical support. Therefore, understanding the multidimensionality through PACAP and RACAP provide insights on how to enhance and maneuver absorptive capacity through Lean Six Sigma systematically. The findings may pave the way for future research in enhancing the current knowledge threshold in Lean Six Sigma.

Exploring the dark side of Lean: a systematic review of the lean factors that influence social outcomes

“…Lean, or "Lean management", relates to the Toyota Production System and definitions have evolved over time (Bhamu and Singh Sangwan, 2014): from a hard set of tools (Shingo and Dillon, 1989) and steps to be taken (Dennis, 2015) to a systems approach that combines both hard and soft factors (Bortolotti et al, 2015;Muraliraj et al, 2020;Langstrand, 2016).…”

Top management commitment and lean team members’ prosocial voice behaviour

“…The involvement of top management is critical for the successful implementation of any project (Tzempelikos, 2015;Alnadi and McLaughlin, 2021;Belhadi et al, 2019). This involvement includes its engagement in providing extensive support to implement changes (Amoako-Gyampah et al, 2018;Rodríguez et al, 2008;Basu and Dan, 2020;Muraliraj et al, 2020;Narayanamurthy et al, 2018). Lean implementation entails high degrees of uncertainty and conflicting demands, such as tensions between immediate production goals and long-term development goals (Maalouf et al, 2019).…”

The Effects of Organizational Absorptive Capacity, Professional Experience and Training over the Use of Sales Force Automation

“…www.ejkm.com 19 ISSN 1479-4411 Muraliraj et al (2019) asserted that companies must foster organizational absorptive capacities to cope with the turbulence of the business world and to survive in dynamic environments. Cohen and Levinthal (1990, p.130) were the first authors to develop the notion of absorptive capacity.…”

“…Second, the majority of early research uses absorptive capacity as an unidimensional concept (e.g. Cohen and Levinthal, 1990), while recent research examines its sub-dimensions, potential and realized absorptive capacities (Ahmed et al, 2019 ;Chaudhary, 2019 ;Muraliraj et al, 2019). However, as far as it is known, there is no research that examined the relationship between organizational absorptive capacity and SFA use through potential absorptive capacity and realized absorptive capacity.…”