Lean Manufacturing Adoption and Its Impact on Productivity in MSMEs Evidence from GIDC Industrial Estates, India

ABSTRACT The lean manufacturing method, which originated from the Toyota Production System, is based on improving production efficiency by eliminating processes that do not add value and continuously optimising the workflow. While the lean manufacturing method appears to be widely adopted by large companies, reliable information on its actual implementation and impact on performance in small and medium-sized enterprises (SMEs), especially those in emerging industrial areas, remains lacking. This study aims to investigate the extent to which small and medium-sized enterprises (SMEs) on the Gujarat Industrial Development Corporation (IDC) campus in India have adopted lean manufacturing methods and their impact on production efficiency. Combining descriptive and analytical methods, raw data were collected from 30 participants through questionnaires, interviews, and field observations. Secondary sources, such as government reports and literature on lean manufacturing, were also consulted. This study focuses on methods such as 5S, Kaizen, Just-in-Time (JIT), Total Productivity Management (TPM), Kanban, and Value Stream Mapping (VSM), and analyses the relationship between these methods and productivity indicators such as output per employee, cycle time, defect rate, machine utilization rate, and overall equipment efficiency (OEE). The results of this study, statistically significant, suggest that the adoption of lean management certainly contributes to increased productivity. This is a positive sign. While basic methods such as 5S and Kaizen are relatively widespread, more advanced tools are still not fully adopted. However, several challenges remain, including a shortage of skilled workers, employee resistance to change, insufficient training, funding issues, and delays in the full-scale implementation of lean management by management. This adds new practical evidence to the literature demonstrating that lean management is an effective way to improve operational capabilities, particularly for small and medium-sized enterprises (SMEs) in such clusters. Training programs, strengthened leadership responsibilities, and supportive policies are especially important for the continued adoption of lean management in these small businesses. While the above analysis may be somewhat simplified, generally speaking, this is true. Keywords: Lean Manufacturing, MSMEs, Productivity, Operational Performance, Continuous Improvement, GIDC, Emerging Economies.