Lean Six Sigma implementation towards achieving sustainable performance among SMEs in Malaysia

Many studies have been conducted on Sustainable Performance (SP) and Lean Six Sigma (LSS), but several implementation models derived failed to be cost-efficient. However, comprehensive research on SP focusing on cost implication of implementing LSS is still lacking. Currently, small and medium-sized enterprises (SMEs) manufacturing face barriers related to SP, including poor financial resources and lack of expertise. More so, there is a rise in the total cost of implementing LSS, which is unaffordable for most manufacturing SMEs due to financial constraints. To address this gap, this research examined the integrated effects of Lean Manufacturing (LM) and Six Sigma (SS) on SP of manufacturing SMEs. This study also proposed and validated a total cost model and implementation guideline toward achieving SP among manufacturing SMEs. This research was based on primary data collected from middle officers working in Malaysia manufacturing SMEs. The study adopts system thinking approach to emphasize the organizational system's role in achieving SP. This study employed a quantitative technique where 251 manufacturing SMEs out of 527 responses received were found to implement LM and SS simultaneously. Statistical Package for Social Sciences and Partial Least Squares Structural Equation Modelling were used to analyse the data. More importantly, results of this study indicated that Supplier Involvement, Just-in-Time, Supplier Development, Continuous Flow, Quality Management Practices, Set up Time Reduction were supported out of nine hypotheses proposed under LM. On the other hand, Six Sigma Structured Improvement Procedure and Six Sigma Focus on Metrics were supported out of three hypotheses proposed under SS. More importantly, this study formulated a cost implementation model from supported hypotheses. This study also formulated LSS implementation guidelines for achieving SP. This study's implications and significant contributions would help avoid cost of rework when product defect and waste in manufacturing are eliminated