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Mount Kenya University

Factors Affecting the Implementation of Lean as a Business
Improvement Technique for Small and Medium Enterprises
(SMEs) in Kiambu County, Kenya
Presented By: Michael Githui Wataka – MBA/NRB/101/0006
Supervised by: Prof. Tom Nyamache

SMEs play a vital role in the growth of the Kenyan

60% of SMEs do not operate beyond the first year.
Various business techniques are available for
improving business performance, however most
require high capital outlay that SMEs may not be
able to conveniently access.
Lean is a low cost approach to improvement. The
uptake of Lean by SMEs is however very low.
The project aims to find out what factors
contribute to this.
A study of 100 businesses shall be done.

The above points to the weak competitive position that most SMEs occupy.Introduction: Background of the Study Businesses can use Lean as a business improvement method. only 40% of SMEs operated beyond the 1st of starting. . Improving the business performance of SMEs is therefore important. Lean works by focusing on increase the value created for the customer by reducing waste. According to the Kenya National Bureau of Statistics survey of 2007.

Introduction: -Profile of Kiambu County One of the 47 counties of Kenyan Republic. 4 major towns and has a myriad of activities ranging from manufacturing. real estate and agriculture. Kajiado. Nairobi Metropolitan comprises of Nairobi. One of the 4 counties forming the Greater Nairobi or Nairobi Metropolitan. .6Million. services. Kiambu County has a population of 1. Machakos and Kiambu counties and accounts for 60% of the nation’s wealth.

(KNBS. Despite the above. studied SMEs in the garment sector and found that capacity management and bottle necks in operations were main hurdles faced. Randiki (2000). 2009).000 jobs created in the Kenyan economy in 2007.Statement of The Problem SMEs are usually small compared to large firms but due their sheer numbers contribute immensely to the economy of any nation. .Introduction:. The above points to weakness in operational capacity of SMEs. 89% were in the SME sector. Lean helps improve the operational capacity of firms leading to improved business performance. this Project sets to find out why this is the case. (Daniels. few SMEs have adopted Lean as a business technique. by studying SMEs in Kiambu County. 2007). Out of the 469.

To determine the willingness of SMEs workers to participate in Lean. .Introduction: Objectives General: The purpose of the study is to explore what factors affect the uptake of Lean as improvement strategies by SMEs in Kenya. Specific: To determine the understanding of Lean amongst SMEs in Kiambu County. with a case study of SMEs in Kiambu County. To determine the willingness of management or owners of SMEs in Kiambu County to commit funds towards Lean. To determine the capacity of SMEs in Kiambu County to implement Lean management.

Research Questions The following research questions will be asked and answered by this study: What is the understanding of Lean amongst management and owners of SMEs in Kiambu County? What capacity do the management and/or owners of the business have to implement Lean initiatives? What amount of funds would managers and owners of SMEs in Kiambu County contribute towards implementation Lean thinking? What would be the willingness of workers in SMEs in Kiambu County to participate Lean initiatives? .

agriculture. 2008). it provides a good representation of what other SMEs may be experiencing in Kenya. . real estate and other service industries. Improving the competitiveness of the SMEs is important to enhance their contribution to the economy. (KNBS. the contribution of SMEs to the Kenyan economy is hampered by their poor competitive nature (Randiki. it also has a population of 1. 1997). Innvoation and automation have been found to be too expensive for SMEs to undertake initially (Hill &Jones. (KNBS. 2007). (Daniels.Justification of the Study SMEs are vital to the growth of any economy despite their small size due to their sheer numbers. 2000) and is further shown by their low survival rate of below 40% in the 1 st year of operation.6million people and various industries ranging from manufacturing. 2011). Unfortunately many SMEs in Kenya do not implement Lean (Sirma. 2008). Due to it’s proximity to Nairobi and its rural urban nature. Kiambu County is part of the Nairobi Metropolis that contributes 60% of Kenya’s wealth (GoK. 2007). Lean on the other hand is a low cost approach to improvement (Imai. In Kenya however. 2009).

” .Introduction: Hypothesis The author has formulated the following hypothesis that will be tested in the study: “The main barriers to uptake of Lean amongst SMEs in Kenya are lack of knowledge about Lean.

Other Matters Significance of the Study Limitations of the Study Definition of Terms .

Literature Review: Theoritical Review Business Improvement Methods Lean and Kaizen Theory Application of the Theory of Contraints to Lean Six Sigma and Lean Lean and Strategy .

Literature Review: Conceptualization – Theoretical Framework SME Survival and Growth Theory of Constraints Lean and Kaizen Theory Six Sigma Theory Business Improveme nt Methods .

Literature Review: Conceptualization – Conceptual Framework Implementation of Lean Knowledge Change Resource Cost Manageme Manageme Manageme Manageme nt nt nt nt .

This variable will enable the researcher to understand the amount of funds managers and owners of SMEs in Kiambu County contribute towards implementation of Kaizen and Lean initiatives. Cost management. Resource management. Change management.Summary of Independent Variables Risk Management. .This variable will enable the researcher to establish the capacity that management and owners of the business have to implement Lean and Kaizen initiatives.This variable will enable the researcher to create understanding of Lean and Kaizen initiatives amongst management and owners of SMEs in Kiambu County.This variable will enable the researcher to establish the willingness of workers in SMEs in Kiambu County to participate in Kaizen and Lean initiatives.

Summary of the Variables Research Gap .Literature Review Empirical Review.

Research Methodology This covers  Introduction  Research Design and Location of the Study  Population  Sampling and Sampling Techniques  Piloting of the Research Instruments  Data Collection Methods and Procedures  Validity  Data Analysis Techniques  Ethical Considerations .

Appendices Questionnaire Letter of Introduction Study Time Frame Study Budget .

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Frontiers in Leadership Research . Holweg. M. (2009). Kubiak.M.d. Gemba Kaizen: A Commonsense. M.References Cont’d Holm. (2006).Create and Implement the Best Strategy for Your Business. Benbow. Genealogy of Lean Production. New York: McGraw Hill.437. Donald. Kenya National Bureau of Statistics. Harvard Business Essentials: Strategy. . Lean Production and business process reengineering in a South African Context: A Case Study. (2005). M. The Certified Six Sigma Black Belt Hand Book. Economic Survey 2007. 420 . W. (1997). R. Nairobi: Kenya National Bureau of Staitistics. D. Wisconsin: ASQ Quality Press. (n. (2008). Low-Cost Approach to Management (1st Edition ed.. 1-7. (2010). Imai. Milwaukee. T. Boston.). MA: Harvard Business Press.). Luecke. Leadership in Lean Production. Kruger. Journal of Operations Management .

220-225.References Cont’d Mugenda. UK and US 1994-2001. Rothenberg. (1990). Delbridge. Salman. A. Lean Production and Manufacturing Performance Improvement in Japan. . J. James. & Gerahgty. H. Little.. Jones. International Journal of Innovation. Research Methods: quantitative and qualitative approaches. & Mugenda. India: I K International Publishing House Pvt Ltd. MA: Productivity Press. (1999). P. New Delhi. Essentials of educational and social sciences research method. Oliver. (2003). R. J. J.. Rochester: Printing Industry Center at RIT. University of Cambridge. Randiki. The Machine that Changed the World: The Triumph of Lean Production. Orodho. M. (2000). Boston.. Womack P. (2004).. Capacity Utilisation in Micro and Small Enterprises : A Case Study. Management and Technology .. (2008). 1 (2). (2002). Dublin: Blackhall Publishing Sekhar. S. Nairobi: Masola Publishers. Daniel. Nairobi: University of Nairobi. Lean Manufacturing in Small and Medium Sized Printers. A. (2010). & Cost. Nairobi: African Centre for Technology Studies. Business policy and strategic management. Applying Lean Principles to Production Scheduling. Cambridge: ESRC Centre for Business Research.. N.. The Barriers to SMES Implementation of Lean Production and Countermeasures: Based on SMES in Wenzhou. & Barton. F. R. van der Krogt.. (2010). T. Roos Daniel. O. SG. Yu. M. Y.

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