The Effect of Lean Manufacturing on the Financial Performance: Case of the Manufacturing Companies in South Lebanon

Abstract

Businesses have been trying to implement new business initiatives such as lean manufacturing to stay alive in the latest competitive market place. Such initiative concentrates on cost reduction by removing the non-value added activities to achieve better financial performance. This study examined the effect of lean manufacturing on financial performance from the perspective of managers in the industrial sector in South Lebanon. The methodology of this study was quantitative in which 152 self-administered questionnaires were distributed randomly among managers. The data was analyzed using SPSS software. Descriptive statistics were identified and proposed hypotheses were tested using Pearson correlation and regression analysis. The results showed that lean manufacturing has a significant and positive effect on financial performance. Future studies are encouraged to expand the research to other regions in Lebanon over a longer time horizon and apply different quality improvement tools.