Impact of Lean Manufacturing Practices in Sri Lankan Western Province SMEs on Their Sustainability Performance: Based on Managerial Perspective

Abstract

The contribution of Small and Medium Enterprises (SMEs) in Sri Lanka plays a massive role economically and socially as it accounts for 80% of all businesses. Since the large scale businesses are now moving towards sustainable development these SMEs could also think of practicing such strategies for the betterment of their future as well as the country. Therefore it is important to show the respective parties the benefits they could gain by having sustainable practices within the business. Hence the main objective of this study is to investigate the impact of one of the sustainable practices which is the Lean Manufacturing Practices (LMPs) on sustainability performance of SMEs. Here sustainability performance were measured under economic, environment and social perspectives which are considered as Triple Bottom Line (TBL) sustainability performances. Data were collected from 100 SMEs in Western Province Sri Lanka through a structured questionnaire and analysis was done with Structural Equation Modeling (SEM) using Smart PLS. Outcome has shown that there is a significant positive impact on sustainability performance from LMPs. In implementing LMPs within a business this will be an supportive study for managers to inspire and get the commitment of business stakeholders who have different expectations. Further this study contributes to theoretical and practical knowledge in terms of the importance of LMPs in maximizing economic, environment and social sustainability performances.