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Impact of Lean Manufacturing and Environmental Management on Business Performance

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Introduction:

 In this report we tried to explain the relationship between lean manufacturing practices environmental management practices and environmental performance, business performance outcomes (e.g., market and financial performance).

 The hypothesized relationships of this model are tested with data collected from 309 international manufacturing firms (IMSSIV) by using AMOS.

 There is an increasing social demand for environmental sustainability and organizations recognize that it has implications for its competitive positions and are striving to inculcate environmental friendly practices. So in this report we try to explain how lean manufacturing practices can achieve this and what impact it has on business performance.

 Lean manufacturing is a collection of tactical methods that helps in eliminating non-value added activities (waste) for delivering quality products with least cost at a greater efficiency.

 Lean implementation is rapidly expanding throughout manufacturing and service sectors as a core business strategy to develop a competitive advantage.

 The focus of lean manufacturing is on driving rapid, continual improvement in cost, quality, service, and delivery, significant environmental benefits typically "ride the coattails" or occur incidentally as a result of these production-focused efforts.

 Lean production techniques create a culture of employee empowerment, and waste minimization, continuous improvement, which is very compatible with organizational characteristics encouraged under environmental management systems (EMS) and pollution prevention (P2). Other related business strategies such as "Six Sigma" can have the same effect.

Hypothesis Development:

H1: Lean manufacturing will be positively...

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...ste (preferably environmental waste) thus increasing environmental efficiency of the firm.

 The paper is very important keeping in fact that it considers Environmental management as a prime factor or driving force for a firm’s efficiency. Presently we could see all the companies are surging towards a greener approach. Companies are trying hard to establish themselves as global environmental friendly firms by different certifications like ISO 14001, etc. and also Government rules & policy off late focuses more on environmental friendly approach.

 In spite of few limitations of this paper, it provides some valuable managerial insights.

References:

http://www.wausau.k12.wi.us

http://www.sciencedirect.com

International Journal of Production Economics

J.C. Anderson, D.W. Gerbing Structural equation modeling in practice: a review and recommended two-step approach
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