The Importance Of Lean Manufacturing Practices Towards Enhancing SMEs' Productivity

Che Deraman, Nurul Farhanah (2017) The Importance Of Lean Manufacturing Practices Towards Enhancing SMEs' Productivity. Project Report. UTeM, Melaka, Malaysia. (Submitted)

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Abstract

Elimination of waste is the process of getting rid of something, whether it’s waste, errors, or the competition. It is one of the most effective ways to increase the profitability of any business. Lack of understanding of the concept lean manufacturing and its principles and some of employees are reluctant to change were problems that facing by Small to medium-sized enterprises (SMEs). Besides, most of the industries especially SMEs are facing with seven types of waste, while costly and time consuming also become one of the problem among SMEs to apply lean. This study aimed to investigated the importance of lean manufacturing practices towards enhancing SMEs productivity. The objective of this study was specifically; i) To study the importance of Lean Manufacturing practices among SMEs. ii) To determine the Lean Manufacturing practices that could enhance SMEs’ productivity. iii) To examine the relationship between the Lean Manufacturing practices and SMEs’ productivity. A descriptive survey research was used to get the primary data by using questionnaire. Respondents were encompassed of 52 individuals who were management staff in selected SMEs through the states of Kelantan, Terengganu and Pahang. It showed there is a positive relationship between lean manufacturing practices and SMEs productivity in this study. The data analyzed using descriptive, regression analyses and correlation analyses found that the coefficient of determination R² = 0.876. This suggests the SMEs’ productivity (Y) is influenced 87.6% by independent variables, while the rest (100% - 87.6% = 12.4 %) is explained by other causes. Lastly, overproduction and waiting time is high positive relationship with SMEs’ productivity, while there were moderate positive relationship between over processing, excess motion and transportation with SMEs' productivity. Therefore, access inventory and production defects have a small and definite relationship between with SMEs' productivity. Hence, through this study, researcher can conclude that overproduction is the strongest characteristics in study the importance of lean manufacturing practices towards enhancing SMEs’ productivity.

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