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A new application model of lean management in small and medium sized enterprises

The research aims to find out a better model of Lean implementation for Vietnamese SMEs. An AS-IS model reflects the current model of Lean implementation employed by Vietnamese SMESs; input of the model is collected from the SMEs’ survey and in-depth interviews. | ISSN 1726-4529 Int j simul model 14 (2015) 2, 289-298 Original scientific paper A NEW APPLICATION MODEL OF LEAN MANAGEMENT IN SMALL AND MEDIUM SIZED ENTERPRISES Nguyen, D. M. University of Economics and Business, Vietnam National University, Hanoi, Vietnam E-Mail: nguyendangminh@hotmail.com Abstract Although Lean management has been implemented by Vietnamese small and medium sized enterprises (SMEs) for more than ten years, the success rate as well as the sustainable effectiveness achieved by these firms remains limited. As revealed by the survey, the current model of implementation mainly focuses on Lean management tools such as 5S, Kaizen (continuous improvement) and Mieruka (visual management). A better implementation model is proposed with the focus laid on the central factor of “Tam the”- a Vietnamese word refers to the deep understanding of employees and managers about the benefits of their tasks and Lean management for themselves. A simulation model run by Crystal Ball software confirms the higher effectiveness of the proposed model, which provides scientific evidence to persuade practitioners to swiftly employ the new model of implementation. (Received in August 2014, accepted in October 2014. This paper was with the author 1 month for 1 revision.) Key Words: Lean Management, Simulation, SMEs, "Tam the" 1. INTRODUCTION Lean management is one of the most advanced management philosophies which focus on attaining customer’s satisfaction and creating values through waste reduction [1, 2]. The effectiveness and efficiency of Lean application is proven by numerous successful cases around the world including Toyota, Nissan, GM, Seven Eleven and etc. Specifically, implementing Lean management could help enterprises to reduce operating time by 50 % and cost by 80 %, to save production space by 30 % and to enhance the productivity by at least 30 % [3, 4]. Lean management has been implemented in many countries all over the world including Asian countries such as