Skip to main content
Log in

Relationship between lean six sigma, environmental management systems, and organizational performance in the Malaysian automotive industry

  • Published:
International Journal of Automotive Technology Aims and scope Submit manuscript

Abstract

In the globalization era, lean initiatives and environmental management systems are increasingly implemented in the automotive industry. The aim of this report is to investigate and perform structural analysis of Lean Six Sigma (LSS) and Organizational Performance (OP). Data were obtained from 252 top management leaders in the Malaysian automotive industry. This report presents the results of the Exploratory Factor Analyses (EFA), Confirmatory Factor Analysis (CFA), and reliability analysis, which are empirically verified and validated. A set of assessment measurements of LSS and OP is expected to be suitable for their characteristics and improve their competitiveness. Thus, the main objective of the analysis was to provide additional insight into the relationship between LSS and OP by examining the effects of ISO 14001 certification as a moderator. The results indicate that ISO 14001 certification does not significantly moderate the relationship between LSS and OP in the Malaysian automotive industry. However, the OP values for ISO 14001 certified companies are higher than those without ISO 14001 certification.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Similar content being viewed by others

References

  • Aberdeen Group (2006). The Lean Six Sigma Benchmark Report. Boston. Massachusetts.

  • Antony, J., Escamilla, J. L. and Caine, P. (2003). Lean sigma. Manufacturing Engineer 82,2, 40–43.

    Article  Google Scholar 

  • Amrina, E. (2009). Manufacturing Performance Measurement Tool for Small and Medium-Sized Enterprises. M. S. Thesis. Faculty of Mechanical Engineering, University Technology Malaysia. Malaysia.

    Google Scholar 

  • Bhasin, S. (2008). Lean and performance measurement. J. Manufacturing Technology Management 19,5, 670–684.

    Article  Google Scholar 

  • Boyer, K. K. (1996). An assessment of managerial commitment to lean production. Int. J. Operation Management 16,9, 48–59.

    Article  Google Scholar 

  • Chang, T. L. (2002). Six Sigma: A Framework for Small and Medium Sized Enterprises to Achieve Total Quality. Ph.D. Dissertation. Cleveland State University. USA.

    Google Scholar 

  • Crino, S. T., McCarthy, D. J. and Carier, J. D. (2007). Lean six sigma for supply chain management as applied to army rapid fielding initiative. Proc. 1st Annual IEEE Systems Conf., 56–62.

  • Cua, K. O., McKone, K. E. and Schroeder, R. G. (2001). Relationship between implementation of TQM, JIT, and TPM and manufacturing performance. J. Operations Management, 19, 675–694.

    Article  Google Scholar 

  • Eker, M. and Pala, F. (2008). The effect of competition, just in time and total quality management on the use of multiple performance measures: An empirical study. J. Economic and Social Research 10,1, 35–72.

    Google Scholar 

  • Flynn, B. B., Sakakibara, S. and Schroeder, R. G. (1995). Relationship between JIT and TQM: Practice and performance. Academy of Management J. 38,5, 1325–1360.

    Article  Google Scholar 

  • George, M., Rowlands, D. and Kastle, B. (2004). What is Lean Six Sigma?. McGraw-Hill. New York.

    Google Scholar 

  • Handley, S. M. and Benton Jr., W. C. (2009). Unlocking the business outsourcing process model. J. Operation Management 27,5, 344–361.

    Article  Google Scholar 

  • Hoque, Z. and James, W. (2000). Linking the balanced scorecard measures to size and market factors: Impact on organizational performance. J. Management Accounting Research, 12, 1–17.

    Article  Google Scholar 

  • Hoque, Z., Mia, L. and Alam, M. (2001). Market competition, computer aided manufacturing and use of multiple performance measures: An empirical study. British Accounting Review, 33, 23–45.

    Article  Google Scholar 

  • Hsu, Y. L. and Liu, C. C. (2010). Environmental performance evaluation and strategy management using balanced scorecard. Environmental Monitoring Assessment, 170, 559–607.

    Article  Google Scholar 

  • Hu, L. and Bentler, P. M. (1998). Fit indices in covariance structure modeling: Sensitivity to under parameterized model misspecification. Psychological Method 3,4, 424–254.

    Article  Google Scholar 

  • Hu, L. and Bentler, P. M. (1999). Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives. Structural Equation Modeling 6,1, 1–55.

    Article  Google Scholar 

  • Ittner, C. D. and Larcker, D. F. (1998). Innovations in performance measurement: Trends and research implications. J. Management Accounting Research, 10, 205–238.

    Google Scholar 

  • Joreskog, K. G. and Sorbom, D. (1993). LISREL 8: Structural Equation Modeling with the SIMPLIS Command Language. Scientific Software Int.. Chicago.

    Google Scholar 

  • Jusoh, R. and Parnell, J. A. (2008). Competitive strategy and performance measurement in the malaysia context: An exploratory study. Management Decision 46,1, 5–31.

    Article  Google Scholar 

  • Kanji, G. K. (2002). Measuring Business Excellence. Routledge Advances in Management and Business Studies. Routledge. London.

    Google Scholar 

  • Kaplan, R. S. and Norton, D. P. (1992). The balanced scorecard-measure that drive performance. Harvard Business Review, 71–79.

  • Kaplan, R. S. and Norton, D. P. (1996). The Balanced Scorecard-Translating Strategy into Action. Harvard Business Scholl Press. Boston.

    Google Scholar 

  • Kaplan, R. S. and Norton, D. P. (2001). The Strategyfocused Organization: How Balanced Scorecard Companies Thrive in the New Business Environment. Harvard Business School Press. Boston.

    Google Scholar 

  • Koufteros, X. A., Vonderembse, M. A. and Doll, W. J. (1998). Developing measures of time based manufacturing. J. Operations Management 16,1, 21–41.

    Article  Google Scholar 

  • Kumar, M., Antony, J., Singh, K. R., Tiwari, K. M. and Perry, D. (2006). Implementing lean sigma framework in an Indian SME: A case study. Production Planning and Control 17,4, 407–423.

    Article  Google Scholar 

  • Kumar, M. and Antony, J. (2009). Multiple case study analysis of quality management practices within UK six sigma and non six sigma manufacturing small- and medium-sized enterprises. Proc. Institution of Mechanical Engineers: J. Engineering Manufacture, 223(Part B), 925–934.

    Article  Google Scholar 

  • Lansiluota, A. and Jarvenpaa, M. (2008). Environmental and performance management forces: Integrating “Greenness” into balanced scorecard. Qualitative Research in Accounting and Management 5,3, 184–206.

    Article  Google Scholar 

  • Li, S., Rao, S. S., Ragu-Nathan, T. S. and Ragu-Nathan, B. (2005). Development and validation of a measurement instrument for studying supply chain management practices. J. Operations Management, 23, 618–641.

    Article  Google Scholar 

  • Mahapatra, S. S. and Mohanty, S. R. (2007). Lean manufacturing in continuous process industrial research. J. Scientific and Industrial Research, 66, 19–27.

    Google Scholar 

  • Moser, C. A. and Kalton, G. (1971). Survey Methods in Social Investigation. 2nd edn. Heinemann Educational. London.

    Google Scholar 

  • Nunnally, J. C. (1978). Psychometric Theory. McGraw Hill. New York.

    Google Scholar 

  • On, C. C. (2006). The Development and Application of Six Sigma Implementation Model for HK/China Manufacturing Companies. Ph. D. Dissertation. City University of Hong Kong. Hong Kong.

    Google Scholar 

  • Parast, M. M., Adams, S. G., Jones, E. C., Rao, S. S. and Raghu-Nathan, T. S. (2006). Comparing quality management practices between the United States and Mexico. Quality Management J. 13,4, 36–49.

    Google Scholar 

  • Pickrell, G., Lyons, H. J. and Shaver, J. (2005). Lean six sigma implementation case studies. Int. J. Six Sigma and Competitive Advantage, 1, 369–379.

    Article  Google Scholar 

  • Sakakibara, S., Flynn, B. B. and Schroeder, R. G. (1993). A framework and measurement instrument for just-in-time manufacturing. Production and Operations Management 2,3, 177–194.

    Article  Google Scholar 

  • Shah, R. and Ward, P. T. (2003). Lean manufacturing: context, practice bundles, and performance. J. Operation Management, 21, 129–149.

    Article  Google Scholar 

  • Shah, R. and Goldstein, S. M. (2006). Use of structural equation modeling in operation management research: Looking back and forward. J. Operation Management 24,2, 148–169.

    Article  Google Scholar 

  • Shah, R., Chandrasekaran, A. and Linderman, K. (2008). In pursuit of implementation patterns: The context of lean and six sigma. Int. J. Production Research 46,23, 6679–6699.

    Article  Google Scholar 

  • Spector, R. (2006). How constraints management enhances lean and six sigma. Supply Chain Management Review 10,1, 42–47.

    Google Scholar 

  • Zadry, H. R. (2005). The Integration of Total Quality Management (TQM) and Theory of Constraints (TOC) Implementation in Malaysian Automotive Suppliers. M. S. Thesis. Faculty of Mechanical Engineering. University Technology Malaysia. Malaysia.

    Google Scholar 

  • Yang, M. G. M., Hong, P. and Modi, S. B. (2011). Impact of lean manufacturing and environmental management on business performance: An empirical study of manufacturing firms. Int. J. Production Economics 129,2, 251–261.

    Article  Google Scholar 

  • Zu, X., Fredenhall, L. D. and Douglas, T. (2008). The evolving theory of quality management: The role of six sigma. J. Operation Management, 26, 630–650.

    Article  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to N. F. Habidin.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Habidin, N.F., Yusof, S.M. Relationship between lean six sigma, environmental management systems, and organizational performance in the Malaysian automotive industry. Int.J Automot. Technol. 13, 1119–1125 (2012). https://doi.org/10.1007/s12239-012-0114-4

Download citation

  • Received:

  • Revised:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s12239-012-0114-4

Key Words

Navigation