Measuring the leanness of manufacturing systems—A case study of Ford Motor Company and General Motors

In spite of thevast researchpublishedon leanmanufacturing systems in several disciplines in the last decade, the concept remains underdeveloped for two reasons. First, it lacks a generally accepted definition. Different authors define lean in terms of its objectives, which vary, overlap and differ in different firms. Second, no study has developed a systematic and relative measure of lean production systems. With the lack of such a measure, two companies cannot be rated objectively on their progress toward becoming lean. This paper has two goals: first, to define manufacturing leanness as a unifying concept, and, second, to develop a systematic, long-termmeasure of leanness. Manufacturing leanness is a strategy to incur less input to better achieve the organization’s goals through producing better output. The systematic measure of leanness has seven characteristics: relative, dynamic, long-term fuzzy logical, objective, integrative and comprehensive. The leanness measure utilizes the fuzzy-logic methodology since lean is a matter of degree. Applying the measure to compare the production leanness of Ford Motor Company and General Motors, the paper selects Honda Motor Company as the benchmarking firm. Selecting just-in-time (JIT), Kaizen, and quality controls as lean attributes, the paper uses surrogates for these attributes extracted fromaudited financial statements over the years 2001–2003. The results show that Ford’s system is more than 17% leaner than GM’s system vis-à-vis the benchmarked company’s system. 2008 Elsevier B.V. All rights reserved. * Corresponding author. Tel.: +1 313 593 9962; fax: +1 313 271 9837. E-mail addresses: [email protected] (M.E. Bayou), [email protected] (A. de Korvin). 1 Tel.: +1 713 221 8403.