Implications of lean implementation to management control systems package – Literature review and empirical evidence

Previous studies show that the lean implementation attempts have not always been successful. Kennedy and Widener (2008) studied the topics of management control systems and lean implementation and tried to find out how these two concepts can affect and support each other. The aim of this thesis was to find out whether there is support to what is suggested in the earlier research conducted by e.g. Kennedy and Widener (2008) stating that management control systems package should be reorganized and the focus of control components adjusted due to implementation of lean manufacturing strategic initiative in order to support the success of the lean implementation and lean initiative in general. This thesis was conducted as an interpretive qualitative case study aiming to explain the control components used in the case company starting lean implementation. The main objective was to describe the management control package in a lean environment and to gain understanding of how management control components change due to lean initiatives, or if they do not change. The case company of this thesis is operating in the manufacturing industry and was at the time of this study implementing its first proper lean strategic initiative after two earlier attempts that had failed. The data collection for the case study was done via interviews, and the framework developed by Kennedy and Widener (2008) is approached with the Malmi and Brown’s (2008) typology of management control system as a package. At the end of this study the control framework developed by Kennedy and Widener (2008) was revised into ‘The reassessed control framework’ based on the case study and analysis of the previous studies. The thesis suggests that the management controls should be reassessed when implementing lean. Not only because it is a leaner way to arrange management control systems package, but because it supports the lean implementation process itself. As a result, the company will be able to reduce costs by increasing effectiveness gained from streamlining of processes and providing better opportunities for the people at the company to participate. As stated on earlier research this study confirmed that designing a management control systems package fit for lean environment should improve the company’s performance. However according to this study the performance is improved especially when the management controls are reorganized to support the involvement of people.siirretty Doriast