Lean principles adoption in environmental management system (EMS): A survey on ISO 14001 certified companies in Malaysia
Perumal
Puvanasvaran, Robert Kerk Swee Tian, Vasu Suresh, Mohd Razali Muhamad
University technical malaysia melaka (Malaysia)
Received: May 2012
Accepted: November 2012
Puvanasvaran, P., Tian R.K.S., Suresh, V., & Muhamad, M.R. (2012). Lean principles adoption in environmental management system (EMS): A survey on ISO 14001 certified companies in Malaysia. Journal of Industrial Engineering and Management, 5(2), 406-430. http://dx.doi.org/10.3926/jiem.486
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Abstract:
Purpose: The purpose of this study is to examine the characteristic of the lean principles in ISO 14001 and to propose linkage between lean principles and ISO 14001.
Design/methodology/approach: To achieve the objective of the study, literature survey and quantitative research method using questionnaire survey are used.
Findings and Originality/value: The findings of this study confirm that ISO 14001 certified company adopted lean production practices. The study also proves that lean principles have a positive and significant relationship with ISO 14001 EMS and the linkage can be made between lean principles and ISO 14001 to achieve Continual Improvement.
Research limitations/implications: The small sample sizes of the participating companies are the main limitations of this study and this research mainly focus on the manufacturing environment and services industry in Malaysia.
Practical implications: This research shows that all ISO 14001 companies do adopt at least one of lean production practices and the main findings are lean principles has positive and highly significant relationship with ISO 14001 requirements. This is because the integration of lean principles in ISO 14001 will serve practical methods for ISO14001 EMS to achieve the continual improvement.
Originality/value: This research is amongst the first to study on the combination of lean principles with ISO 14001. Based on the current situation, there is no integration between this two management system.
Keywords: Lean Principles, EMS, ISO 14001, Integration.
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1. Introduction
Management practices in
the recent days have undergone rapid transformations owing to global
changes
taking place. The focus of
organizations has been on increasing
operational efficiency, reducing costs, enhancing quality levels,
ensuring
steady profits, and meeting customer needs. The efforts of the
management in
the recent times have been on enhancing productivity through efficient
methods
of production that emphasizes on the elimination of unnecessary
procedures and
processes that add to production costs. The
efficiency of production process determined by the optimal use of
resources and
adopting an environmentally friendly production method. Environment
management systems or EMS has been the focal point of management
strategies in
most organizations today.
EMS
practices within an
organization need to be integrated with exiting organizational
practices to
realize its true potentials. Research studies have revealed that the
majority
of organizations focuses more on gaining market competitive advantage,
improving customer relations, and increasing profit potentials than
adopting
work processes that satisfy environmental safety and policy
requirements.
Lean
is one such business
model that focuses on delivering quality products to the customer at
reduced
cost of production. The principles of Lean are founded on understanding
of
customer needs and demands, eliminating non-value added activities from
the
production process, involving the workforce in resolving operational
issues,
define metrics for measuring organizational performance, assist in the
decision
making process and problem solving (Ross & A.E.C, 2004).
ISO 14001 is the world’s
most recognized EMS framework that helps organizations both to manage
better
the impact of their activities on the environment and demonstrate sound
environmental management. ISO 14001 is designed to be flexible enough
to be
applied to any size of organization in both the private and public
sectors by Montabon,
Meinyk, Stroofe and Calantone (2000).
The
organization of this
paper is as follows. Section 1 is the introduction. Section 2
literature
review. Section 3 presents the research methodology. Section 4 results.
Section
5 discussion. Section 6 presents conclusions, recommendation and future
research.
2. Literature review
The literature review will
focus on identifying the various aspects of Lean and EMS systems, ISO
14001
standards and its prospective business applications. Lean principles
encourage
an organisation to bring about significant changes in their operational
and
cultural environment. This in turn has a positive impact on the
environmental
performance of the company reducing pollution, waste and emissions.
Lean
principles enable companies to deliver with lesser resources resulting
in
lesser scrap and wastage. It encourages organisations to judiciously
use
natural resources, such as energy, water and forest products. Lean
pushes for
continuous improvement and empowers companies to better their
environment performance
(Environment Protection Agency, 2010).
It can be seen that Lean
principles and ISO 14001 standards have a lot of common ground and both
aim at
reducing waste. Lean focuses on delivering the maximum value to the
customer
using the required resources at minimizing waste. When an organisation
implements Lean, there are significant cost savings. There is optimum
utilization of resources and wastage is reduced. This has a positive
impact on
the environmental performance of the company. When a company is
implementing
Lean principles into EMS, it must clearly set forth the objectives of
such an
initiative (Mc Donald, 2005). The senior management must play an
important and
visible role in implementing the Lean and green initiatives. The
procedures and
measures for attaining the goals must be clearly communicated to the
employees
at all levels. There must be cross functional cooperation in the
organisation
to learn and benefit from mutual experience. There should be a process
of
acknowledging the best practices of each unit and introducing the same
at the
company level. A company can benefit tremendously from combining the
Lean and
green efforts. The company will be seen as contributing to protecting
the
environment and preserving it for future generations. It will result in
reduced
cost of operations, optimum utilization of resources, reduction in
wastage and
better profitability for the organisation.
Environmental
Management
System (EMS)
In
the 21st
century, there is great emphasis on companies and businesses to
contribute
towards protecting the environment as part of their corporate social
responsibilities. Companies need to adopt measures to protect and
enhance the
environment in order to maintain good relations with customers,
suppliers and
vendors. There is a growing need for businesses to fulfil their
corporate
social responsibilities in order to survive in the global economy.
Environment
management system (EMS) can help the company in fulfilling their
responsibilities towards protecting the world environment (Gbedemah,
2004). An
EMS provides the framework to manage the company’s environmental
responsibilities effectively and also helps in integrating the
environmental
initiatives into the day to day operations. An efficient EMS is
critical to all
types of business irrespective of the nature, size and scale of
operations. In
the global market, it is important for manufacturing, automotive,
retail and
service industries to have an EMS in place. An effective EMS
contributes to
cost savings and reduces the environmental liabilities (Cheremisinoff,
Rosenfeld and Rosenfeld, 2010). It also helps in ensuring
that employees, suppliers and vendors understand their role in the
environmental policy and contribute effectively towards meeting the
environmental
objectives of the organization (Visser, Matten, Tolhurst & Pohl,
2010).
ISO 14001 standard
and principles
ISO 14001 is an
internationally accepted standard that sets out the steps to be taken
by a
business to put in place an effective
EMS (Environmental
Protection Agency,
2002). It helps in integrating the
environmental goals into the overall operations of the company. ISO
14001
standards were written by consensus of nearly 50 countries and more
than 100
countries have endorsed it as an international standard. ISO 14001 is
applicable to all types of organizations with varying nature and size
of
operations. It is also relevant to companies with different risk
profiles. It
is easily adaptable either to an entire organization or a specific
function
(Woodside & Aurrichio, 2000). ISO 14001 has
become an administrative tool towards corporate environmental
management (Puvanasvaran,
Muhamad & Kerk, 2010). It also helps in reducing
insurance and prosecution risks. ISO
14001 helps in gaining
investor confidence and brings in more ethical investment (Whitelaw,
2004).
Lean system
Lean is a tool for process
improvement that aims at maximizing customer value and minimizing waste
(Miller,
Pawloski & Stanridge, 2010). Lean
helps in focusing on
key processes that affect the output to the customer. It focuses on
continuously improving the process management elements to deliver
maximum value
to customers. Lean helps in achieving the organizational goals with
fewer
resources and zero waste. Lean does not focus individually on systems,
tools,
technologies, assets and functions. It works on optimizing the process
flow
across assets, systems, technologies and functions to deliver the best
value to
customers (Lean Enterprise Institute, 2009).
Earlier,
lean principles
were thought to be relevant only to manufacturing companies. This is no
longer
true. Lean can be implemented successfully across all industries. To
reap the
full benefits of lean, the company must adopt it as part of their
business
strategy (Turbide, 2005). This will result in lean
principles being implemented consistently across all the functions in
the
organization and will have a positive impact on the overall
performance.
Lean
should be adopted as
a way of thinking and as a way of doing business in order to fully
enjoy its
benefits (Sarkar, 2007). According to Reidenbach
& Goeke (2006, pp. 1), “Rather than having cost reduction as the
exclusive
focus of lean thinking, the conceptual framework of lean also has
tremendous
potential for increasing top-line revenue by creating a sustainable
differential value advantage for the enterprise that deploys the
concept in its
entirety.”
Integrating lean
into ISO 14001
Earlier it was thought
that lean and EMS has different objectives and hence cannot be
integrated. A
company would implement its
lean and EMS initiatives separately
with a view that the two target different kind of waste. Lean involves
implementation of measures for optimizing the process flow and
minimizing
waste. EMS is aimed at putting policies and procedures in place to
reduce the
adverse effect on the environment. Subsequently, studies have shown the
strong
relationship between the lean and green activities in an organization.
Both
lean and green initiatives share a common goal of reducing wastage. The
wastage
defined in lean management also has significant environmental impact. Implementation
of lean principles will have a positive impact on the company’s
environmental
performance. A business should take a holistic approach in implementing
an EMS
and integrate the lean principles to the environmental aspects of the
company.
Companies should work towards fostering an effective relationship
between the
lean and green activities to maximize customer satisfaction and
minimize waste
(Mitsuishi, Ueda & Kimura, 2008).
For
the lean principles to
be integrated into the ISO 14001 standards in an organization, the
environment
policy and lean objectives must be clearly defined. A well defined
system must
be in place setting out the roles and responsibilities of the employees
in
different departments across various levels. The employees should
clearly know
what their lean and green goals are and the means to achieve them. This
helps
in reducing the time and effort spent on searching for solutions
(Gordon,
2001).
The process of integrating
Lean into the EMS is a multi-layered process and involves many steps.
The first
step is listing those areas of function in the company which has the
largest
environmental impact. The business should ensure that the Lean
principles are
integrated into those processes that impact the environmental
performance. The
next step is creating awareness amongst the employees about the Lean
and green
efforts of the company. Employees must be made to feel that their
company does really
care about the environment and not merely undertaking to implement an
EMS for
ISO certification. They must be able to see and understand the vision
of the
company in integrating Lean principles into ISO 14001 standards.
Employees must
be fully aware of the course of their actions and their environmental
impact. Another
important factor for deriving the system successfully was the employee
problem
solving capability (Puvanasvaran, Megat, Tang, Muhamad & Hamouda,
2008). Top
management commitments play a very important role and have a strong
relationship with problem solving capability (Puvanasvaran, 2009). It
is only
with this understanding that organisations can get the full support and
participation of the employees in integrating Lean principles into the
EMS (Gordon,
2001).
The
company should work on integrating the EMS requirements into the
existing
systems. If a separate process flow is created for EMS, there could be
issues
of lack of coordination between the environmental measures and other
processes.
The procedures and measures for attaining the goals
must be clearly communicated to the employees at all levels. The study
done by
Puvanasvaran, Kerk and Muhamad, (2011) effectiveness of integrating
Lean and
EMS can be realized by adopting processes and procedures designed to
eliminate
waste and create an economically sustainable work environment.
3.
Research methodology
The research design is one
of the key factors in determining the effectiveness of the research
study. If
the method applied does not meet the needs of the objectives, the
findings and
analysis of data collected are wasted. A mixed method of Qualitative
and
Quantitative research design would be employed. The
Review of
current literature will provide a meaningful addition to the
qualitative aspect
of the study, while survey questionnaire will contribute to the
quantitative
aspect of the study. The purpose of this study
is to ensure internal and external validity of the study with
Cronbach’s Alpha.
This study conducted using the cross-sectional survey which is the most
appropriate tool to be used. Information of this study was gathered
from various
ISO 14001 certified companies in Malaysia. The best approach to gather
data for
this study is through a survey by distributing questionnaires to the
respondents. The set of questionnaire is designed to collect the data
and
information needed in this study.
Questionnaire development
The questionnaire
development is done by referring to all the data gather such as
literature
review, books, and etc. For this study, the questionnaire was divided
into two
sections. Section
A and Section B.
In the first section of
the questionnaire, the question was developed by referring to previous
study
conducted by Puvanasvaran, Megat, Tang and Muhamad (2009); Boyer
(1996). It is
used to identify the ISO 14001 certifies companies adopted the lean
production
practices. In the second section of the questionnaire, the questions
were
developed from Womack et al. (1990) and Malaysian Standard
Environmental System
(EMS) requirement with guidance for use (ISO 14001:2004). The second
section of
the questionnaire was used to measure the positive and significant
relationship
of lean principles with the ISO 14001 requirement.
Pilot test
Pilot test conducted to
ensure that the result of the questionnaire is valid and meet the
objective of
the research. This is done by sending the questionnaire to 10 ISO 14001
certified companies around Melaka. Discussion of the questionnaire was
held
when the company was visited. Opinion was given which help the
researcher to
modify the existing questionnaire. Besides that, from the pre-test, the
total
time spend with the company also can be identified.
Sending and receiving
questionnaire
In this study, data was obtained
only from primary sources. Primary data in this context refer to the
information obtained first hand by the researcher on the variables of
interest
for the specific purpose of this study. In this study, the primary data
obtain
from the ISO 14001 certified companies around Malaysia. The data
collection
method used is questionnaire.
A questionnaire is a
pre-formulated written set of questions which respondents record their
answers.
This study is preferred to use this method because it is easy for the
researcher to get the information. In addition by using this method, it
is less
costly compared to other methods. Type of question asked in the
questionnaire
is close-ended. This is to make sure the respondents easy to fill in
the answer
and state in the questionnaire. In the questionnaire, Likert scale
questions
will be used. The questionnaire was distributed around May 2011 and the
process
of distributing and collecting the questionnaires takes around 8 weeks.
The data were collected
from ISO 14001 certified company in Malaysia. The list of the 420 ISO
14001
certified company was collected from the Malaysian Certified Database.
A total
of 140 questionnaires were mailed by hand into the respondent. With
close
follow up by telephone call, email, and personally meet up with the
respondent
to hand in and collected the questionnaires, only 48 completed
questionnaires
was received. Clear instructions were given to ensure individual
selected as
respondents must be those involved with the ISO 14001 in their
respective
company.
Data analyzing
The data analysis flow
chart in the Figure 1 shows the data analysis process. From the data
collection, feel for data, goodness of data, hypothesis testing to the
interpretation of the result, the step and flow can be seen.
There are a number of
different reliability coefficients. One of the most commonly used is
Cronbach’s
alpha (Coakes, 2005). It is used to assess the internal consistency
reliability
of several items or scores that the researcher wants to add together to
get a
summary or summated scale score (Morgan et al., 2004). Cronbach’s alpha
is
based on the average correlation of items within a test if the items
are
standardized (Coakes, 2005). The alpha value should be positive and
usually
greater than 0.70 in order to provide good support for internal
consistency
reliability (Morgan, Leech, Gloeckner & Barret, 2004).
In this study, the first
part of the questionnaire, the mean and standard deviation were
computed with
the scores of the eight variables. The mean is the value of the degree
of
adoption of lean production practices in the ISO 14001 certified
company. The
percentage of each variable also has been measure to support the value
of the mean
and standard deviation.
In
the second part of the
questionnaire, reliability coefficients, descriptive statistics, and
correlation will do to measure the relationship of lean principles with
the ISO
14001 requirement. Correlations measure how variables are
related. Before calculating a correlation coefficient, data is screened
for
outliers and evidence of a linear relationship. Pearson’s correlation
coefficient is a measure of linear association. If the relationship is
not
linear, Sprerman’s rho will be used to measure the correlation between
the
variables (Morgan et al., 2004). A Pearson correlation coefficient
describes
the relationship between two continuous variables. A correlation
between two
dichotomous or categorical variables is called phi-coefficient (Coakes,
2005). Correlation
is measured between each variable of the lean principles that is value,
value
streams, flow, pull and perfection with the ISO 14001 requirement.
Reliability Test,
Descriptive Statistics and Correlation are used for this study. The
Statistical
Package of The Social Science (SPSS version 19) uses to record, analyse
and
interpret raw data. The
data obtains were compiled, summarized
and display in a form that is easily understood.
Figure 1. Data analysis flow Chart
4.
Results
As
of date July 2011, total ISO 14001 certified companies in whole
Malaysia are
420 companies in total. Only companies located in Selangor, Kuala
Lumpur,
Negeri Sembilan, Melaka, Johor, Kedah, Pulau Pinang, and Perak are
selected. This
is because the ISO certified company from others states mostly come
from a government
agency and plantation industries. From 290 companies located in these 8
states,
only 140 companies were selected as sample size. The other 150
companies were
excluded from the survey because they are from plantation industry,
construction industry and government agency.
Questionnaires are
distributed to the selected company by mail except for a company in
Melaka and
Negeri Sembilan because most of the questionnaires were delivered by
hand. From
this 140 ISO 14001 certified companies, only 34.3% or 48 respondent
response
and return back the questionnaires show as Table 1. According to
Sekaran
(2010), a 30 percent response rate is considered acceptable because the
return
rates of mail questionnaires are typically low. In the rules of thumb,
sample
size larger than 30 and less than 500 is also appropriate for most
research
(Roscoe, 1975).
State |
Frequency |
Percent % |
Manufacture |
Service |
||
Frequency |
Percent % |
Frequency |
Percent % |
|||
Selangor |
7 |
14.6 |
4 |
57.1 |
3 |
42.9 |
Negeri Sembilan |
11 |
22.9 |
11 |
100 |
0 |
0 |
Melaka |
18 |
37.5 |
14 |
77.8 |
4 |
22.2 |
Johor |
5 |
10.4 |
4 |
80 |
1 |
20 |
Kedah |
1 |
2.1 |
1 |
100 |
0 |
0 |
Pulau Pinang |
5 |
10.4 |
5 |
100 |
0 |
0 |
Perak |
1 |
2.1 |
1 |
100 |
0 |
0 |
Total |
48 |
100 |
40 |
83.3 |
8 |
16.7 |
Table 1. Distribution of respondent based on State and Industry
Lean
Production Practices in the ISO 14001 Certified Companies
The
lean production practices are identified in the ISO 14001 certified
companies.
This section also will measure the adoption of lean production
practices in the
ISO 14001 companies. Reliability Test and Descriptive Statistics are
discussed
in this section. This section will discuss the result from analysis to
prove
that the ISO 14001 certified companies has adopted lean production
practices.
Reliability
Cronbach’s alpha is used
to assess the inter-item reliability, with alpha values of 0.7 or
higher
considered to indicate acceptable reliability for establishing scales
(Soriano-Meier & Forrester, 2002). Cronbach’s alpha is based on the
average
correlation of items within a test if the items are standardized
(Coakes, 2005).
Table 2 shows that the alpha value for the ISO 14001 certified company
that has
adopted lean production practices is 0.772 and no of item is 8, which
is exceeded
or higher than 0.70.
Other than that, with the
exception of Cellular Manufacturing, the scale reliabilities are
highest when
all the 8 items are included which is 0.809. The alpha value just
slightly
increased approximately 4.8% of the increment, even after elimination
of the
item Cellular Manufacturing.
Similar to the study done
by Puvanasvaran et al., (2009) on Lean Process, the results show that
the alpha
value just increased slightly in their studies and no elimination has
been
done. Therefore the elimination needs not necessarily to be justified
(Grandzol
& Gershon, 1998).
cale |
Mean |
SD |
Alpha if Deleted |
Lean Production Practices (Alpha = 0.772) |
|
|
- |
Items |
|
|
|
Continuous Improvement (Kaizen) |
1.94 |
0.24 |
0.758 |
Zero Defect |
1.81 |
0.39 |
0.723 |
Just-In-Time (JIT) |
1.9 |
0.31 |
0.741 |
5S' and General Visual Management |
1.88 |
0.33 |
0.747 |
Total Preventive Maintenance (TPM) |
1.79 |
0.41 |
0.72 |
Pull Production and Kanban |
1.69 |
0.47 |
0.719 |
Standardized Work |
1.88 |
0.33 |
0.747 |
Cellular Manufacturing |
1.63 |
0.49 |
0.809 |
Table 2. Reliability analyses of Lean Production Practices
Descriptive
Statistics
Descriptive
Statistics of lean production practices are shown in Table 3. It shows
that the
highest lean production practices in the ISO 14001 certified company
are
Continuous Improvement (Kaizen). 93.8% or 45 respondents have adopted
Continuous Improvement (Kaizen) in their companies. This is followed by
Just-In-Time that is 89.6% or 43 respondents. 5S’ and General Visual
Management
and Standardized Work have the same value that is 87.5% or 42
respondents. It follows
by Zero Defect that is 81.3% or 39 respondents. Other than that, 79.2%
or 38
respondents have adopted Total Preventive Maintenance (TPM) in the
companies. It
is followed by Pull Production and Kanban that is 68.8% or 33
respondents. The
last lean production practice is Cellular Manufacturing that is 62.5%
or 30
respondents.
Items |
Frequency |
Percent |
Cumulative Percent |
Mean |
SD |
|
Continuous Improvement (Kaizen) |
No Adoption |
3 |
6.3 |
6.3 |
1.94 |
0.24 |
Adoption |
45 |
93.8 |
100 |
|||
Zero Defect |
No Adoption |
9 |
18.8 |
18.8 |
1.81 |
0.39 |
Adoption |
39 |
81.3 |
100 |
|||
Just-In-Time (JIT) |
No Adoption |
5 |
10.4 |
10.4 |
1.9 |
0.31 |
Adoption |
43 |
89.6 |
100 |
|||
5S' and General Visual Management |
No Adoption |
6 |
12.5 |
12.5 |
1.88 |
0.33 |
Adoption |
42 |
87.5 |
100 |
|||
Total Preventive Maintenance (TPM) |
No Adoption |
10 |
20.8 |
20.8 |
1.79 |
0.41 |
Adoption |
38 |
79.2 |
100 |
|||
Pull Production and Kanban |
No Adoption |
15 |
31.3 |
31.3 |
1.69 |
0.47 |
Adoption |
33 |
68.8 |
100 |
|||
Standardized Work |
No Adoption |
6 |
12.5 |
12.5 |
1.88 |
0.33 |
Adoption |
42 |
87.5 |
100 |
|||
Cellular Manufacturing |
No Adoption |
18 |
37.5 |
37.5 |
1.63 |
0.49 |
Adoption |
30 |
62.5 |
100 |
Table 3. Descriptive Statistics of Lean Production Practices
N |
Valid |
48 |
Missing |
0 |
|
Mean |
1.81 |
|
Median |
1.94 |
|
Mode |
2 |
|
Std. Deviation |
.236 |
|
Percentiles |
25 |
1.63 |
50 |
1.94 |
|
75 |
2.00 |
Table 4. Mean, Median, and Mode for All Lean Practices
From
Table 4, the statistics show that the lean production practices had the
mode
value of 2. It shows that ISO 14001 companies have
adopted the lean principles in their organization. The mean value of
1.81 also
shows that the result is more toward to the adoption of lean production
practices.
Similar
from the previous study, value of the Mean and Standard Deviation is
used to
analyse the result (Roslan, Taib & Watee, 2009). Similar to the
study done
by Puvanasvaran, Tay, Megat, Tang and Rosnah (2009), Mean and Standard
Deviation was used to identify the degree of adoption in the analysis.
Other
than that, alpha values of 0.7 or higher considered to indicate
acceptable
reliability for establishing scales (Soriano-Meier & Forrester,
2002). In
the study done by Najmuddin et al., (2009) Descriptive Statistical
analysis was
used for the study to analyse the result. Result of reliability
analysis and
descriptive statistic in the Table 2 till Table 4 clearly support that
the ISO
14001 certified companies has adopted lean production practices.
Relationship
of lean principles with ISO 14001 requirement
This
section will measure the agreement of adoption of lean principles and
ISO 14001
(EMS) implementation. Reliability Test and correlation are discussed in
this
section. This section will discuss the result from analysis to prove
that Lean
Principles have a positive and significant relationship with the ISO
14001
requirement.
Reliability
The result of reliability
analysis for each set of lean principles; value, value streams, flow,
pull, and
perfection are shown in Table 5. Cronbach’s alpha is used to assess the
internal consistency reliability of several items or scores that the
researcher
wants to add together to get a summary or summated scale score (Morgan
et al.,
2004). In addition, the mean and standard deviation for each of the
items are
also indicated. Cronbach’s
alpha is used to assess the
inter-item reliability, with alpha values of 0.7 or higher considered
to
indicate acceptable reliability for establishing scales (Soriano-Meier
&
Forrester, 2002).
Items |
Cronbach's Alpha |
Lean Principles |
0.986 |
Value |
0.963 |
Value Streams |
0.946 |
Flow |
0.967 |
Pull |
0.955 |
Perfection |
0.945 |
Table 5. Overall lean principles Cronbach’s Alpha
From the result, Table 5
shows that Cronbach’s Alpha for first lean principle Value has the
alpha value
at 0.963. For the second lean principle, Value Stream has the alpha
value at
0.946. Flow, the third principle has the alpha value at 0.967. The
alpha value
of Pull is 0.955 and lastly the alpha value for Perfection is 0.945.
All the
alpha value for each lean principle is higher than 0.70 and the overall
Lean
Principles Cronbach’s Alpha value is 0.986. George
& Mallery (2003: pp. 231) provide the following rules of thumb:
> 0.9 – Excellent,
> 0.8 – Good,
> 0.7 – Acceptable,
> 0.6 – Questionable,
> 0.5 – Poor, and
< 0.5 – Unacceptable
That means all questions are highly
reliable with the study. Therefore, it is concluded
that the measured have an acceptable level of reliability.
Correlation
This
section will discuss the analysis and result of correlation on lean
principles
with ISO 14001. Each of the lean principles will be identified and
studied to
measure how strong and significant the correlation is. Lean Principles
have a positive
and significant relationship with ISO 14001 requirement can be analysed
and
support from the result in this section.
According
to our survey shows that the inter-correlation between 1st
lean
principle Value with ISO 14001 requirements are highly significant
where p is
less than 0.01. All five variables were positively correlated
with Value. According
to the correlation analysis between 1st lean principles
Value and
ISO 14001 requirements (Table 6), we discover that the higher variable
with
value are implement documented environmental objectives
and targets has the highest correlation, where value r is equal to
0.948. Figure
2 shows the PP plots of Lean Principles “Value”
against ISO 14001 Requirements. The
PP plot is useful to compare the centre of the distribution. In this
case, we
can quite reasonably conclude that the normal distribution provides a
good
model for the data.
According to Womack and
Jones (2003), lean Value is specified from the perspective of the
customer. It
is about listening to the voice of the customer in order to meet the
customer
requirements and recognizing and eliminating waste. The
understanding of Value from the customer’s perspective then carefully
to take
the time to actually explore this with the customers so that inaccurate
assumptions will not be made (Womack & Jones, 2003).
Performance indicators can be used to track progress in achieving the
objectives and targets as the documentation and communication of
objectives and
targets improves an organization’s ability to achieve its objectives
and target
(EMS ISO 14004:2004 Requirements with Guidelines – 4.3.3.1). This is
where
Value shall establish, implement and maintain documented environmental
objective and targets as from the customer perspective consistent with
the
environmental policy and to continual improvement.
|
1th Lean Principles |
Items |
Value |
|
Correlation |
Value help to improve our fulfillment to customer requirements in ISO 14001 |
.935** |
Value help to implement documented environmental objectives and targets |
.948** |
Value help to implement program for achieving environmental objectives and target. |
.929** |
Value helps an organization comply with environmental laws and regulations. |
.938** |
Value help to increase awareness and participation of employees. |
.923** |
**. Correlation is significant at the 0.01 level (2-tailed).
Table 6. Value with ISO 14001 Requirements
Figure 2. Lean Principles “Value” against ISO 14001 Requirements
From the correlation analysis between 2nd
lean principles Value Stream and ISO 14001 requirements
(Table 7) are highly significant where p is less than 0.01. We
can see that, the higher variable with value stream are identified
ISO14001 implementation process loopholes has the highest correlation,
where
value r is equal to 0.959. Figure 3 shows the PP plots of Lean
Principles “Value Stream” against ISO 14001
Requirements. The normal probability plot shows a strongly linear
pattern. There
are only minor deviations from the line fit to the points on the
probability
plot. The normal distribution appears to be a good model for these data.
Value
Stream will
recognize waste or non value added step in the process and is known as
Value
Stream Mapping (Womack
& Jones, 2003).
The organization shall establish, document, implement,
maintain, and continually improve an environmental management system in
accordance with the requirements of the international standard and
determine
how to fulfil the requirement (EMS ISO 14001:2004 Requirements – 4.1).
This
where Value stream helps to identify ISO 14001 implementation process
loopholes. Value
Stream Mapping will identify all the steps in the
value stream for each process by eliminating whenever possible the
steps that
do not create value and continuous improvement.
|
2nd Lean Principles |
Items |
Value Stream |
|
Correlation |
Value stream help to streamline work in ISO14001 implementation. |
.872** |
Value stream significantly reduce waste within ISO 14001 implementation process. |
.907** |
Value stream help to identify ISO14001 implementation process loopholes. |
.959** |
Value stream help to identify actual and potential nonconformity. |
.909** |
Value stream help to reduce the complex documents control system in ISO 14001 implementation. |
.896** |
**. Correlation is significant at the 0.01 level (2-tailed).
Table 7. Value Stream with ISO 14001 Requirements
Figure 3. Lean Principles “Value Stream” against ISO 14001 Requirements
Based
on the relationship between 3rd lean principles Flow and ISO
14001 requirements (Table 8) are highly significant where p is less
than 0.01. All
six variables were positively correlated with Flow,
we find that identifying nonconformity to mitigate their
environmental impacts has the highest correlation, where value r is
equal to
0.961. Figure 4 shows the PP plots of Lean Principles
“Flow” against ISO 14001 Requirements. The normal
probability plot shows a reasonably linear pattern in the centre of the
data. However,
the tails, particularly the lower tail, show departures from the fitted
line. A
distribution other than the normal distribution would be a good model
for these
data.
According to Womack and
Jones (2003), Flow is about working towards a process that delivers
value with
the most effective use of resources. EMS has to be effective on an
ongoing
basis so organisations should have a systematic method for identifying
actual and
potential nonconformity, making corrections and taking corrective and
preventive action (EMS ISO 14004:2004 Requirements with Guidelines –
4.5.3). This
where Flow will come in to identifying nonconformity to mitigate the
environmental impacts as flow makes the value-creating steps occur in
tight
sequence so the product will flow smoothly toward the customer.
|
3rd Lean Principles |
Items |
Flow |
|
Correlation |
Flow help to identifying nonconformity to mitigate their environmental impacts. |
.961** |
Flow help to correcting nonconformity to mitigate their environmental impacts. |
.951** |
Flow help to investigating nonconformity in order to avoid their recurrence. |
.885** |
Flow help to evaluating the need for actions to prevent nonconformity to avoid their occurrence. |
.927** |
Flow help to reduce the usage of resources in ISO 14001 implementation. |
.885** |
Flow help the organization to verify that the system is operating according to plan. |
.958** |
**. Correlation is significant at the 0.01 level (2-tailed).
Table 8. Flow with ISO 14001 Requirements
Figure 4. Lean Principles “Flow” against ISO 14001 Requirements
According to our survey
shows that the inter-correlation between 4th lean principle
Pull
with ISO 14001 requirements are highly significant where p is less than
0.01. All
four variables were positively correlated with Pull. From the Table 9,
the correlation
between lean principle Pull and ISO 14001 Requirement, the organization
stipulating the operating criteria in the procedures has the highest
correlation, where value r is equal to 0.950. Figure 5 shows the PP
plots of Lean
Principles “Pull” against ISO 14001 Requirements. For
data with long tails relative to the normal distribution, the non
linearity of
the normal probability plot shows the middle of the data may show an
S-like
pattern. In this particular case, the S pattern in the middle is fairly
mild. In
this case we can reasonably conclude that the normal distribution can
be
improved upon as a model for these data.
Womack & Jones (2003),
Pull is to get close as they can to produce according to demand or
consumption
rate with little or no inventory in the system. From the EMS ISO
14004:2004
Requirements with Guidelines – 4.4.6, an organization needs to apply
some type
of operational controls to meet its environmental policy commitments,
achieve
its objectives and targets, comply with applicable legal requirements
and other
requirements to which the organization subscribes and manage its
significant
environmental aspects. This is where Pull can help the organization
stipulating
the operating criteria in the procedures as Pull can
produce to demand and link the process closer to actual customer demand
with
little or no inventory in the systems.
|
4th Lean Principles |
Items |
Pull |
|
Correlation |
Pull help to taking actions to mitigate their environmental impacts. |
.938** |
Pull help to implementing appropriate actions designed to avoid nonconformity occurrence. |
.933** |
Pull help the organization to ensure the effective planning that relate to its significant environmental aspects. |
.936** |
Pull help the organization stipulating the operating criteria in the procedures. |
.950** |
**. Correlation is significant at the 0.01 level (2-tailed).
Table 9. Pull with ISO 14001 Requirements
Figure 5. Lean Principles “Pull” against ISO 14001 Requirements
Table 10 shows that the inter-correlation
between 5th lean principle Perfection with ISO 14001
requirements. All
four variables were positively correlated with lean principle
Perfection highly
significant where p is less than 0.01. From the table, correlation
between lean
principle Perfection and ISO 14001 requirement, to ensure this standard
continuing suitability, adequacy and effectiveness has the highest
correlation,
where value r is equal to 0.960. Figure 6 shows the PP plots of Lean
Principles “Perfection” against ISO 14001 Requirements. There
are only minor deviations from the line fit to the points on the
probability
plot. The normal distribution appears to be a good model for these data.
Perfection is about the
continuing striving for the perfect process by continually removing
successive
layers of waste as it was uncovered (Womack
& Jones, 2003). An organization should periodically review and
continually
improve its environmental management system with the objective of
improving its
overall environmental performance (EMS ISO 14004:2004 Requirements with
Guidelines – 4.5.3). With Perfection it can help to ensure the standard
continuing suitability, adequacy and effectiveness of the ISO 14001.
|
5th Lean Principles |
Items |
Perfection |
|
Correlation |
Perfection helps to assessing opportunities for improvement and the need for changes to the standard. |
.922** |
Perfection helps to ensure this standard continuing suitability, adequacy and effectiveness. |
.960** |
Perfection helps to ensure this standard consistent with the commitment to continual improvement. |
.879** |
Perfection helps in sustaining the ISO 14001 standards certification. |
.949** |
**. Correlation is significant at the 0.01 level (2-tailed).
Table 10. Perfection with ISO 14001 Requirements
Figure 6. Lean Principles “Perfection” against ISO 14001 Requirements
5.
Discussion
The
results of the data analyses show
that all ISO 14001 companies do adopt at least one of lean production
practices. Other than that, the result of reliability analysis in the
Table 2
show that all the variables are indicated acceptable reliability for
establishing scales with the Cronbach’s alpha value which is exceeded
or higher
than 0.70. While it also shows that each variable of Continuous
Improvement
(Kaizen), Zero Defect, Just-In-Time (JIT), 5S' and General Visual
Management,
Total Preventive Maintenance (TPM), Pull Production and Kanban,
Standardized
Work, and Cellular Manufacturing has the Mean value higher than average
toward
the adoption of lean production practices. Similar from the previous
study,
value of the Mean and Standard Deviation is used to analyse the result
(Roslan
et al., 2009). Similar to the study done by Puvanasvaran (2009), Mean
and
Standard Deviation was used to identify the degree of adoption in the
analysis.
Other than that, alpha values of 0.7 or higher considered to indicate
acceptable reliability for establishing scales (Soriano-Meier &
Forrester,
2002).
This
study also found that there was a significant and positive relationship
between
Lean Principles: value, value stream, flow, pull and
perfection with the ISO 14001 requirement. Similar
to the study done by Puvanasvaran (2009), Reliability Test and
Correlation was
used to identify the degree of adoption and commitment in the analysis
to
support and prove the Hypotheses. Similar to the study done by Roslan
et al.,
(2009), the hypotheses are proved and clarify with the Pearson
Correlation
Analysis.
Table 5 shows that all the
variables are indicate highly acceptable reliability for establishing
scales
with the Cronbach’s Alpha which is exceed or higher than 0.70. The
table also
shows that the Cronbach’s Alpha value of five lean principles that are
Value
(0.963), Value Streams (0.946), Flow (0.967), Pull (0.955) and
Perfection
(0.945). The
Cronbach’s Alpha for lean principles is 0.986 far
exceed 0.70 which mean the established scales reliability is highly
acceptable.
Table
6 to Table 10 indicates that all the variables are positively
correlated to the
lean principles that are Value, Value Streams, Flow, Pull, and
Perfection. The Correlation
between lean principles and ISO 14001 requirements are highly
significant where
p value is less than 0.01. As shown in Table 6, correlation between
lean
principle Flow and ISO 14001 Requirement, to identify nonconformity to
mitigate
their environmental impacts has the largest correlation, where value r
is equal
to 0.961.
To use skewness and kurtosis to see if the
distribution is normal, we need to convert the given skewness and
kurtosis
scores to z-scores. Use the following formula: zskewness =
(K-0)/SEskewness or
z kurtosis = (S-0)/SEkurtosis. S = Skewness; K = kurtosis; SE =
Standard Error
(of skewness or kurtosis). If the value is smaller than 1.96, the
distribution
is normal. In larger samples, this value should be increased to 2.58.
The
results of the Z score of Skewness for lean principles value is
-0.478/0.343 =
1.39, value stream is -0.739/0.343 = 2.15, flow is -0.471/0.343 = 1.37,
pull is
-0.378/0.343 = 1.10 and perfection -0.477/0.343 = 1.39. The results
show the Z
score for the five lean principles is smaller than 1.96, the
distribution is
normal. Another way in which normality can be tested is by means of the
Kolmogorov-Smirnov
(K-S) and the Shapiro-Wilk
tests. These tests compare the distribution with a
comparable normal distribution. The Shapiro-Wilk test is used for small
sample
sizes (less than 50). The
results of the tests are shown in Table 11. Shapiro-Wilk test for Lean
principles value p= 0.053, value stream p= 0.056, Flow p= 0.052, Pull
p=0.072
and perfection p= 0.114. If the Sig p>0.05 and therefore the
data is normally distributed. From
these result we reach the conclusion that lean principles has a
positive
relationship with ISO 14001 requirements.
|
Kolmogorov-Smirnov(a) |
Shapiro-Wilk |
||||
|
Statistic |
df |
Sig. |
Statistic |
df |
Sig. |
Value |
.124 |
48 |
.062 |
.953 |
48 |
.053 |
Value Stream |
.126 |
48 |
.055 |
.952 |
48 |
.056 |
Flow |
.125 |
48 |
.059 |
.937 |
48 |
.052 |
Pull |
.127 |
48 |
.051 |
.956 |
48 |
.072 |
Perfection |
.125 |
48 |
.060 |
.961 |
48 |
.114 |
(a) Lilliefors Significance Correction
Table 11. Output of Kolmogorov-Smirnov and Shapiro-Wilk Test for Checking the Normality of the Lean Principles
6.
Conclusion
The purpose of this paper
is to identify the ISO 14001 certifies companies
adopted the lean production practices and to measure the positive and
significant relationship of lean principles with the ISO 14001
requirement. The
results show that all ISO 14001 companies do adopt at
least one lean production practices. Primarily, the main
findings show that the lean principles have
positive and highly significant relationship with ISO 14001
requirements.
There
is a need for everyone to be aware and understand the lean principles
and the
process of implementation. This is where it plays a crucial role in
ensuring
the successful implementation of lean principles integrates with
ISO14001
requirements. This is because the integration of lean
principles in ISO 14001 will serve practical methods for ISO14001 EMS
to
achieve the continual improvement.
There
are still some limitations in the research. Firstly, the research
mainly
focuses on the manufacturing environment and services industry.
Secondly, the research
can be further enhanced through a bigger population with various types
of
industries to understand the adoption of lean principles in ISO14001
implementation.
Recommendations
and future study
This is one of the first
attempts to understand and integrate the lean principles into ISO
14001. Based
on the current situation, there is no integration within this two
management
system. The integration of lean principles into ISO 14001 will serve
practical
methods for this standard to achieve the continual improvement.
There
are few interesting
recommendations and future study that can be done in the future. They
are:
- will become another interesting area for future study would be to understand the impacts of lean principles on ISO 14001. The first is related to the so called environmental management system and the second is to the five lean principles.
- lean principles and ISO 14001 have natural coexistence whether people understand the relationship or not. As the study to understand the correlation between lean principles and ISO 14001, future study can better integrate both and upgrade the organization or company in terms of efficiency as well as continuous improvement of the ISO 14001.
- once the linkage has been analysed and identified, the development of the framework can be done in the future study. With this framework, the study can be implemented in the ISO 14001 certified companies in Malaysia and the success of the lean principles and ISO 14001 integration can be measured.
- from this measurement and study, more improvement can be done with the framework and implementation process before the integration of lean principles and ISO 14001 can be truly a success.
Acknowledgement
The author would like to
acknowledge the Ministry of Science, Technology and Innovation (MOSTI) for
the project granted for this study: PROJECT NO.:
06-01-14-SF0046
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Journal of Industrial Engineering and Management, 2008-2024
Online ISSN: 2013-0953; Print ISSN: 2013-8423; Online DL: B-28744-2008
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