Overcoming the barriers to the implementation of more efficient productive strategies in small enterprises
| Date | 06 January 2020 |
| Pages | 149-165 |
| DOI | https://doi.org/10.1108/ER-11-2018-0298 |
| Published date | 06 January 2020 |
| Author | Andrea Signoretti |
| Subject Matter | Hr & organizational behaviour,Industrial/labour relations,Employment law |
Overcoming the barriers to
the implementation of more
efficient productive strategies in
small enterprises
Andrea Signoretti
Department of Sociology and Social Research, University of Trento, Trento, Italy
Abstract
Purpose –The purposeof this paper is to elaborate an empiricalmodel of how small, family-ownedcompanies
can overcome the barriersthat have been shown in different disciplines to hinder the implementationof lean
production in thiscategory of enterprises.
Design/methodology/approach –A multiple case study involving five carefully selected small manufacturing
firms operating in Northern Italy was conducted through interviews with key managers and visits inside plants.
This data was integrated by a specific seminar and by interviews with unions and training specialists.
Findings –The resulting empirical model highlights the significance of social relations among small
entrepreneurs in overcoming anylack of commitment towardslean changes,the role of consultantsand practical
training in breaking the barrier of resource constraints and the channelling and control of employee involvement
to encourage their participation in lean activities. Unions, when present, also play a role in preventing situations
of excessivework intensity. Important variantswithin this common model alsoemerged among small firmson
the grounds of their structure (e.g. size), product market conditions and managerial choices.
Practical implications –Knowledge on how to overcome the barriers to lean production implementation
can help social actors both inside and outside of differently characterised small firms which are implementing,
or intending to implement, the lean approach.
Originality/value –There is no existing literature on the subject of successful application of lean methods
in small enterprises. The uniqueness of this paper’s contribution is reinforced by its broad analytical
perspective on the lean system, stemming from an interdisciplinary analysis of different bodies of literature,
including management, operations, human resources and employment relations in line with the definition of
the lean system.
Keywords Small firms, Employment relations, Human resources, Lean production,
Interdisciplinary studies, Operations and management
Paper type Research paper
1. Introduction
Small manufacturing firms play an important role in European national economies.
They employ a significant number of workers and produce a substantial proportion of
national turnover (Djassemi, 2014). In the case of Italy, the country of focus for this study,
official businessstatistics for manufacturingattest to the country’s weighing towardssmaller
firms (Eurostat,2013). This paper concentrates on small manufacturing firms thatare family
owned, which constitute the vast majority of small enterprises (Klein, 2000; OECD, 2014).
In these small firms, the proprietor usually acts as an owner-manager. They are also
independent in theirownership, which means that these enterprises do not receive additional
resourcesfrom larger parent companies,which would invalidate thecharacteristics associated
with their smallness (Minbaeva et al., 2003). Henceforth, the expression “small firm”refers to
manufacturing enterprises of this size that are independent and family owned.
The number of smallfirms changes over time, with new businessesestablished every year
and othersceasing to operate. The higher failurerate of small firms is due to the fact thatthese Employee Relations: The
International Journal
Vol. 42 No. 1, 2020
pp. 149-165
© Emerald PublishingLimited
0142-5455
DOI 10.1108/ER-11-2018-0298
Received 16 November 2018
Revised 14 May 2019
Accepted 12 June 2019
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0142-5455.htm
Assessorato al Lavoro, Formazione professionale, Orientamento per il mercato del lavoro, Istruzione,
Personale, Provincia di Torino.
149
Productive
strategies
in small
enterprises
companies, facing various structural and market issues, are more vulnerable to global
competition thanare medium- and large-sized enterprises (Brown and Inman,1993). Previous
literaturehas highlighted how smallfirms can compete in internationalmarkets through strict
mutual collaborations and, internally,through the deployment of general purposetechnology
and flexible labour in producing quality products in limited batches. Intra-firm collaboration
between owner-managers and workers has been also considered as relevant, with the latter
providing the necessary tacit knowledge to constantly improve products and processes.
All these elements largely assume informal characteristics. This typeof competitive strategy
is known as flexible specialisation (Piore and Sabel, 1984). However, recent studies have
shown that confronting increased international competition and uncertain markets, these
businessmodels strive to survive for two mainreasons (Herrigel and Zeitlin,2010). First, small
firms are requiredto pursue cost-reduction goals that are not central to flexible specialisation
models (Herrigel and Zeitlin, 2010). This need is particularly felt in small enterprises
operating in mature industries, as is mostly the case in the Italian context, with lower
opportunitiesfor disruptive technologicalor scientific innovations (Campagnolo and Camuffo,
2011). Second,the assurance of reliabilityin product delivery and quality becomescrucial, and
small companies are often hampered by incorrect lead times and due dates, and a lack of
sophisticated quality controls (Sabel, 2005; Campagnolo and Camuffo, 2011).
Addressing these issues requires the use of rigorous scientific tools and specific
managerial principles to create standards on which continuous improvement should
be based, hence overcoming the informalitycharacterising strategiesof flexible specialisation.
In this vein, workers’tacit knowledge remains important but needs to be incorporated into
codified policies (Sabel, 2005). Lean production can provide the means for this (Rawabdeh,
2005); indeed, many scholars have defined lean production as an organisational model that
combines cost savings with reliability in product delivery and quality by adopting both hard
and soft codified practices (Kochan et al., 1997; Secchi and Camuffo, 2016; Tortorella et al.,
2015). Hard practicesrefer to technical and analyticaltools such as Kanban and 5S, while soft
practices for applyingsuch techniques are those pertaining to managerial principles and the
role of workers, suchas just-in-time methods, quality management, scientific standardisation,
continuous improvement, employee involvement and cooperative small group problem-
solving. This definition of lean production includes practices (analytical tools, managerial
principles and workers’role) across various disciplines (operations, management, human
resources and employment relations)(Bortolotti et al., 2015). At any r ate, despite the relevance
of lean productionto small firms, previous studies haveestimated that fewer than 10 per cent
of such companies are able to implement this system (Saurin et al., 2011). Certain features of
small companies should facilitate lean production application. In particular, these enterprises
can implement lean production more quickly than larger enterprises because they have
fewer organisational layers, which enables owner-managers to rapidly convey their
commitment throughout the organisation (Haksever, 1996). To date, however, the barriers to
lean implementation have overpoweredthese advantages for small firms (Bhasin, 2012;Shah
and Ward, 2003).
Despite the socioeconomic importance of small firms, there has been scant research into
their recurrent failures in adopting the lean production model and thereby increasing their
competitiveness (with some exceptions, including Achanga et al., 2006; Conner, 2001), as
scholars have tended to focus on large enterprises (Sim and Rogers, 2008). In particular,
studies are yet to elaborate an empirical model highlighting how small companies can
overcome the barriers that hinder their implementation of lean production. This paper
formulates such an empirical model by focusing on managerial agency. It is unique among
the few studies conducted on small firms and lean production in drawing insights from
literature across various disciplines, including management, operations, human resources
and employment relations, in line with the definition of the lean system. Consequently, a
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