Implementing Lean Procurement : Opportunities, methods and hinders for medium sized enterprises - a case study

Abstract: This thesis describes how lean procurement can be implemented in a medium sized enterprise, focusing on opportunities in the process, methods to achieve the opportunities, and hinders that need to be handled. A literature study has been conducted to identify these aspects, organized by six implied implementation stages of lean procurement. To challenge the findings, an empirical study was conducted at Isaberg Rapid, in order to confirm or discard identified important concepts. In order to conduct a credible study, the choice of a qualitative method has been chosen to contribute to the studied area, with a main emphasis of providing an insider’s view of the case company by semi- and unstructured interview questions. Further, an abductive research process can explain the work order, where an iterative approach has been used between theoretical and empirical studies to create an understanding of the studied area. Isaberg Rapid as a case company was chosen because of their successful lean work and their current aim of implementing lean procurement. A starting point for the study was a theoretical review to decide how and what data that needed to be collected. This led to the choice of interviews, documents analysis and observations at the case company, where interviews were the main contributor with participants connected to lean and procurement. Collected data was interpreted and conceptualized, in order to function as a base for the analysis, together with the theoretical study. The theoretical study describes the opportunities, methods and hinders of lean procurement in the implied implementation stages of Internal lean, Understanding the supply, Establish lean suppliers, Efficient inbound logistics, Joint improvements and development, and finally An extended enterprise. The analysis compares these findings with the empirical study, to depict main concepts of lean procurement, related to medium sized enterprises. The study shows the importance of creating a lean culture that is manifested internally, that can support the development of the procurement function, and further motivate and influence suppliers to adapt the lean work. Main opportunities identified in the study are increased inventory turnover, capable suppliers and reduced waste in the supply chain. Important methods to enable the opportunities are assigned lean roles, education and training, kaizen events, kanbans, milk runs and knowledge sharing. Main hinders for the methods and opportunities are resistance, commitment and trust, resources, power circumstances, and distant suppliers.