The effect of lean production on financial performance: The mediating role of inventory leanness

Hofer, Christian; Eroglu, Cuneyt; Hofer, Adriana Rossiter

doi:10.1016/j.ijpe.2012.03.025

Cited by 267 publications

(241 citation statements)

References 61 publications

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“…It follows that the lean production model is reflected in the degree of competitiveness of the entire business system that adopts it. The LP is therefore a strategy or philosophy that promotes the use of practices, such as the kanban, a type of scheduling system, the total quality management (TQM) and just-in-time (JIT), to minimize scrap/waste and improve the performance of a company [8,9]. The LP initially broken down into four areas/strategic phases of production: Product development, supply chain, also called Kanban supermarket [10][11][12], the management of the workshop, and after-sales service.…”

Section: Theory and Methods-lean Management And Industrial Ecologymentioning

confidence: 99%

Industrial Ecology and Environmental Lean Management: Lights and Shadows

et al. 2014

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Current industrial production is driven by increasing globalization, which has led to a steady increase in production volumes and complexity of products aimed at the pursuit of meeting the needs of customers. In this context, one of the main tools in the management of customer value is Lean Manufacturing or Production, though it is considered primarily as a set of tools to reduce the total cost of the resources needed to achieve such needs. This philosophy has recently been enriched in the literature with case studies that link Lean Management (LM) with the improvement of environmental sustainability. The consequence is an expansion of the Computer Integrated Manufacturing (CIM); indeed, CIM, currently, combining and integrating the key business functions (e.g., business, engineering, manufacturing, and information management) with a view of the life cycle, does not highlight the strategic role of the environmental aspects. In order to deal with the increasingly rapid environmental degradation that is reflected in society, in terms of both economy and quality of life, Industrial Ecology (IE) introduced a new paradigm of principles and instruments of analysis and decision support (e.g., Life Cycle Assessment-LCA, Social Life Cycle Assessment -SLCA, Material Flow Account-MFA, etc.) that can be considered as the main basis for integrating the environmental aspects in each strategy, design, production, final product, and end of life management, through the re-engineering of processes and activities towards the development of an eco-industrial OPEN ACCESSSustainability 2014, 6 6363 system. This paper presents the preliminary observations based on a analysis of both theories (LM-IE) and provides a possible assessment of the key factors relevant to their integration in a "lean environmental management", highlighting both positives (lights) and possible barriers (shadows).

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Section: Theory and Methods-lean Management And Industrial Ecologymentioning

confidence: 99%

Industrial Ecology and Environmental Lean Management: Lights and Shadows

et al. 2014

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“…A positive relationship between lean practices and firm performance has been identified by Lewis (2000), Yang, Hong andModi (2011), Hofer, Eroglu andHofer (2012), among others. Papers in this stream of literature are summarized in Table 4.…”

Section: Lean Practices and Performancementioning

confidence: 91%

“…These bundles of practices are interrelated, internally consistent and mutually facilitating, including Just-In-Time (JIT), Total Quality Management (TQM), Total Preventive Maintenance (TPM), Human Resource Management (HRM), kanban, etc. (Shah and Ward, 2003;Hajmohammad et al, 2012;Hofer, Eroglu and Hofer, 2012). The ultimate goal of lean production is to increase profitability by systematically minimizing wastes and increasing efficiency (Hofer, Eroglu and Hofer, 2012).…”

Section: Short-term and Long-term Sustainability Practicesmentioning

confidence: 99%

“…(Shah and Ward, 2003;Hajmohammad et al, 2012;Hofer, Eroglu and Hofer, 2012). The ultimate goal of lean production is to increase profitability by systematically minimizing wastes and increasing efficiency (Hofer, Eroglu and Hofer, 2012). Lean was designed to identify and reduce seven forms of wastes, namely, overproduction, waiting, transportation, defects, inappropriate processing, unnecessary inventory and unnecessary motion (Verrier et al, 2014).…”

Section: Short-term and Long-term Sustainability Practicesmentioning

confidence: 99%

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Short-term versus long-term benefits: Balanced sustainability framework and research propositions

Wu¹,

Subramanian

Abdulrahman

et al. 2017

Sustainable Production and Consumption

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Sustainability research has been expanding rapidly during recent decades. Such research takes various forms with the identification of mixed results. Even though there are several review articles on sustainability with valuable insights, the time dimension aspect of sustainability is totally missing in addition to lack of well-developed framework. This paper systematically reviews previous sustainability studies published in the refereed scientific journals for the past two decades to understand the evolution of sustainability issues in the business context and solutions proposed until now. The study categorizes the popular sustainability practices into short-and long-term practices based on the time effect, and link them with different forms of organizational capabilities and sustainability performance. The paper further proposes a two-dimensional sustainability framework that incorporates practices, capabilities and performance, and the balancing issues between short-and long-term sustainability. At the end, it suggests potential research directions for future research as well. Graphical abstract Highlights We systematically reviews the past two decades sustainability studies published in the refereed scientific journals  We use time dimension to classify and understand sustainability benefits Review of sustainability theories, practices, capabilities, and performance Classification of sustainability practices, capabilities, and sustainability performance Model & propositions development We categorized sustainability practices and performances into short-and long-term perspectives for effective managerial decisions  We propose research propositions relating firm's capability and its implementation of shortand long-term sustainability practices and sustainability performance.  We draw attention to the future role of organizational capabilities and their interactions with sustainability practices to achieve better performance.

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“…Given the tremendous importance of inventory in firms' competitive and financial lives, a lively literature has emerged through the careful analysis of inventory management and financial performance (Fry and Steele 1995, Gaur, Fisher et al 2005, Capkun, Hameri et al 2009, Kesavan, Gaur et al 2010, Eroglu and Hofer 2011, Caglayan, Maioli et al 2012, Hofer, Eroglu et al 2012, Jones and Tuzel 2013, Kesavan and Mani 2013, Kroes and Manikas 2014. Despite the varied nature of the results found over time, a relatively robust consensus seems to be emerging that prudent inventory management does indeed contribute to better financial performance (Gaur, Fisher et al 2005, Modi and Mishra 2011, Hourmes, Dickins et al 2012, Jones and Tuzel 2013, Kesavan and Mani 2013, Wang, Yiu et al 2013, Alan, Gao et al 2014, Basu and Nair 2014, Kroes and Manikas 2014.…”

Section: Theoretical Backgroundmentioning

confidence: 99%

Are Inventories Accretive? Lessons from Inventory and Earnings Relationship in the U.S. Capital Goods Sector

Ray¹

2017

AFR

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This paper presents results documenting the effects of inventories (considered as current assets) on corporate earnings in the US capital goods industry. The results reveal that inventories may have a negative impact on corporate earnings. Therefore, shareholder wealth may be negatively impacted by carrying inventories in the US capital goods sector. Carrying inventories may be crowding out non-inventory assets. Interestingly, higher inventories may lead to depressed overall sales. Depressed overall sales may contribute to further reduction in non-inventory assets. This reduction in non-inventory assets may further result in lower corporate earnings. These results strengthen the need for optimal inventory management and also call for a more nuanced treatment of inventories in the standard accounting literature. These results also strengthen the popular rationale for lean supply chain management. This paper contributes to the literature on the close relationship between operational efficiency and corporate financial outcomes.

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The effect of lean production on financial performance: The mediating role of inventory leanness

Cited by 267 publications

References 61 publications

Industrial Ecology and Environmental Lean Management: Lights and Shadows

Industrial Ecology and Environmental Lean Management: Lights and Shadows

Short-term versus long-term benefits: Balanced sustainability framework and research propositions

Are Inventories Accretive? Lessons from Inventory and Earnings Relationship in the U.S. Capital Goods Sector

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