The effect of national culture on the critical success factors of lean: overcoming disagreement

(1)

1

The effect of national culture on the

critical success factors of lean:

overcoming disagreement

by

Marc Segers

University of Groningen Faculty of Economics and Business

MSc Supply Chain Management

June 24th, 2019

Marc Segers m.a.segers@student.rug.nl

Student number 2325551 Supervisor: dr. ir. T. Bortolotti

Co-assessor: dr. ir. N.J. Pulles

Acknowledgments:

I am most grateful to my supervisor, dr. ir. T. Bortolotti, for his guidance during the past three months. His extensive knowledge of the subject, combined with his patience, has helped me throughout the whole thesis. Furthermore, I would like to express my sincere gratitude to the co-assessor of my thesis,

(2)

2

Abstract:

Lean manufacturing has gained increased interest in the current literature; however, the literature suggests that there is no universal approach. Multiple authors suggest that national culture is one of these contingent factors. Nonetheless, not all researchers agree on whether national culture has a significant effect on lean. This paper is an attempt to overcome these inconsistencies. It provides clarity by looking into the different possible effects of national culture on the critical success factors (CSFs) of lean. The literature review provides two conceptual models, one in which national culture acts as a moderator, and one in which it acts as an antecedent of lean. Structural equation modeling is performed to test both models, making use of data from the third round of the High-Performance Manufacturing (HPM) project. The findings suggest that national culture does affect lean. However, the discussion shows that authors who prove otherwise are not wrong. Three factors explain the differences in results: choice of cultural framework, the scope of the research, and the concept of fit. Managers can use the article to understand which CSFs are more effective and natural in their culture. They can use this information to their advantage in order to increase the leanness of their firms.

Keywords:

(3)

3

1. Introduction

Lean manufacturing (henceforth lean) has become immensely popular in the last decades, due to its ability to effectively focus on the added value for the customer. Companies achieve this by eliminating different sources of waste. Since the emergence of the manufacturing philosophy, many companies have tried implementing it. However, most of the companies do not gain the results they were aiming for (Bortolotti, Boscari, & Danese, 2015; Pay, 2008). Therefore, researchers started to identify factors that must be present for the successful adoption of the lean philosophy. In light of the contingency theory, these critical success factors (CSFs) are not universal. No one-size-fits-all approach for increasing the 'leanness' of an organization exists.

Researchers have looked into the effect of different contingencies, including but not limited to firm size, national wealth, organizational culture and national culture (e.g., Marodin & Saurin, 2015; Netland, 2016; Shah & Ward, 2003). There is controversy surrounding the effect of national culture. On the one hand, some authors find that national culture does affect the implementation of lean significantly. For example, Wiengarten, Gimenez, Fynes, & Ferdows (2015) argue that lean practices, which are team-based, are more effective in collectivistic cultures. On the other hand, several articles show that differences in national culture do not influence the implementation of lean. For example, Cheung, Myers, & Mentzer (2010) argue that cultural differences are decreasing due to globalization and that national culture, therefore, is not essential for improvement programs. How can it be that there is no consensus on this topic?

One possible explanation for these inconsistencies can be the use of different (and sometimes inappropriate) methodologies. National culture has been conceptualized as a moderator and as an antecedent of lean interchangeably. Neither of these methods is wrong, but the misinterpretation of these methods can lead to confusing and contradicting results (Venkatraman, 1989). In a conceptual model where national culture is an antecedent of lean, it suggests that different cultural types are (de)stimulating the use of lean. The moderation model describes that the effect of the CSFs on the leanness of an organization is contingent on national culture. Therefore, the use of CSFs to increase the leanness of a firm would be more effective in certain countries. A thorough search of the literature yielded no other articles that have considered these different methods in their research on national culture in operations management.

This study aims to remove confusion regarding the topic of national culture and the CSFs of lean by answering the following research question:

'How does national culture influence the effect of CSFs on the leanness of an organization?'

The value added to the current literature will be the following. Firstly, this study will provide clarity on how to conceptualize national culture. The literature review provides two conceptual frameworks, namely 'fit as moderation' and 'fit as mediation’. Both will be tested and analyzed. The discussion will elaborate on the different implications of the models, which will help to clarify the inconsistent results concerning national culture in operations management.

(5)

5

2. Literature review

2.1 Lean

This article will use the definition of lean from Shah & Ward (2007): 'Lean manufacturing refers to an integrated social-technical system whose main objective is to eliminate waste.' The strength of this definition is that it is all-embracing, stressing that both the technical and social aspects are essential. For this reason, researchers often split lean practices into soft lean and hard lean practices, where soft lean practices consist of social practices, and hard lean practices consist of technical practices. This research will use the same categorization.

The many failures of lean implementation highlight its complexity. Even though implementing the tools is not that difficult, successfully implementing the whole philosophy is. Taking a piecemeal approach (i.e., implementing only one lean tool) will most likely fail (Liker & Morgan, 2006), since successful lean implementation emphasizes changing the whole organizational culture (Liker & Hoseus, 2008). In order to cope with the complexity of lean implementation, authors started identifying CSFs of lean implementation. The next paragraph will describe the reviewed literature and the identified CSFs.

2.2 The CSFs of lean

CSFs are defined as: 'those few things that must go well to ensure success for a manager of an organization, and, therefore, they represent those managerial or enterprise areas that must be given special and continual attention to bring about high performance' (Boynton & Zmud, 1985). Literature sometimes refers to CSFs from an opposing perspective, calling them barriers (e.g., Marodin & Saurin, 2015). This article transposes these barriers to CSFs.

(6)

6

Critical success factors

Netland (2016) Hu et al. (2015) Hilton & Sohal (2012) Manville et al. (2012) Timans et al. (2012) Vinodh & Joy (2012) Pedersen & Huniche (2011) Jeyarama n & Kee (2010) Näslund (2008) Achanga et al. (2006) Chan et al. (2005) Total

Management engagement and commitment x x x x x x x x x x 10

Education and training x x x x x x x x x x 10

Motivated personnel x x x x x x x x 8

Empowered personnel x x x x x x x x 8

Vision and plan statement x x x x x x x x 8

Available resources x x x x x x x x 8

Communication x x x x x x x 7

Skills and expertise x x x x x x x 7

Supportive organizational culture x x x x x x 6

Performance measurement x x x x x 5

Linking to business strategy x x x x x 5

Project prioritization, selection, reviews and tracking x x x x x 5

Rewards and recognition x x x x x 5

Linking to customer x x x 3

Linking to suppliers x x x 3

Use of lean tools and methods x x x 3

Project success stories, best practices sharing and benchmarking x x x 3

Organizational infrastructure x x x x 4

Teamwork x 1

Emphasize safety and job attractiveness x 1

Use external experts x 1

(7)

7

2.3 National culture in operations management

Contingency theory suggests that there is no universal approach to the successful implementation of improvement programs. The literature has repeatedly suggested that national culture is a contingent factor. One of these articles is that of Adam, Flores, & Macias (2001), in which they called for culture-specific quality improvement models. Boscari, Bortolotti, Netland, & Rich (2018) did an extensive literature review regarding national culture in operation management. They concluded that, even though not all researchers have similar findings, national culture does matter for operations management. However, it should be noted that this might change due to globalization (Cheung et al., 2010).

This article will use the definition for culture of Hofstede (1980): 'The collective programming of mind which distinguishes the members of one human group from another.' Multiple frameworks are available that describe differences in national culture. In operations management literature, the GLOBE model and Hofstede’s cultural framework are most widely used (Bockstedt, Druehl, & Mishra, 2015).

Hofstede (1980) defined four dimensions of national culture: power distance, individualism, uncertainty avoidance, and masculinity. These dimensions were developed based on survey data of 40 different countries, which he gathered during his career at IBM. Hofstede ranked all dimensions between 0 and 100. Power distance is about the equality of power within a country. In countries with high power distance, less powerful members accept that there is an unequal distribution of power, without further justification. The second dimension is individualism and its counterpart, collectivism. In countries with high levels of individualism, individuals are expected to take care of themselves and their families. Opposed to individuals in countries with high levels of collectivism live in denser social networks, expecting individuals to look after each other. The third dimension, masculinity versus femininity, is often summarized as tough versus tender. The masculine side of the spectrum is about heroism, assertiveness, and material rewards, as opposed to a preference for cooperation and modesty at the femininity side. The final dimension is the uncertainty avoidance index. This dimension shows how countries cope with uncertainties. Countries with high levels of uncertainty avoidance are characterized by trying to control the future. In later work, Hofstede added two more dimensions: long-term orientation versus short-term orientation and indulgence versus restraint. Long-term orientation is about pragmatic virtues oriented towards future rewards. Cultures with a high score in this dimension are described as persistent, being, and able to adapt to changing circumstances. Cultures on the other side of the dimension, foster their society. They have national pride, respect for traditions, and want to fulfill their social obligations. The final dimension, indulgence versus restraint, is about the allowance of simple pleasures in life. Cultures with a high score on indulgence are characterized as more likely to allow simple pleasures, whereas low scoring cultures are more likely to regulate behavior and adhere to strict social norms.

In a more recent study, House, Hanges, Javidan, Dorfman, & Vipin (2004) developed a competing framework. They did a study involving 172 investigators in 62 countries. Approximately 17.000 middle managers received the survey. This data was used to build upon and extend the framework of Hofstede. The authors proposed nine dimensions: performance orientation, future orientation, gender egalitarianism, assertiveness, institutional collectivism, in-group collectivism, power distance, humane orientation, and uncertainty avoidance.

(8)

8 Smith (2006) compares both frameworks, concluding that they have their limitations. He states that there is not one superior framework. They differ in levels of aggregation, chosen methodology, and the number of dimensions. The latter is the first reason for the choice of Hofstede's framework. Fewer dimensions will make the framework easier to comprehend. Secondly, the dimensions of the GLOBE framework have a higher correlation, which increases the risk of multicollinearity (House et al., 2004). Thirdly, Merritt (2000) has done a study in which he retested the construct validity of Hofstede’s data and showed the relevance of this framework for business and management research. Finally, Magnusson, Wilson, Zdravkovic, Zhou, & Westjohn (2008) compared multiple cultural frameworks. They concluded that Hofstede’s framework, despite its limitations, compares favorably to other models. Table 2.2 provides an overview of the analyzed quantitative literature on national culture within the operations management improvement literature (i.e., the literature on improvement efforts in operations management). Boscari et al. (2018) recently did an extensive review of this topic. This article uses their sample as a starting point for gathering literature. Their analysis included only a few articles specifically on lean; therefore, other literature was gathered by searching the Scopus database. The following search phrase was entered: 'TITLE-ABS-KEY((lean OR JIT OR "just-in-time" OR TQM OR "total quality management" OR TPM OR "total productive maintenance") AND "national culture")'.

The first thing to notice from the table is that many different improvement efforts will be analyzed. Lean programs and lean related programs (such as TQM) are most important for this article. However, the table includes other improvement efforts as well, since there is no consensus on the effect of national culture on these efforts as well. Even though this article focuses on lean, it is highly likely that this article will also explain the disagreement for other improvement programs. Adding these to the table will provide more profound insides into how the operations management improvement literature conceptualizes national culture.

Furthermore, column three of the table shows that authors have used either Hofstede or GLOBE. Some even used other measures. For example, Adam et al. (2001) compared the results of two countries to see whether there are differences between these countries. Cagliano, Caniato, Golini, Longoni, & Micelotta (2011) used a measure for cultural distance within the Hofstede framework. They calculate this value by subtracting the dimension values of one country, from the values of the other country. Column four also shows that authors use different versions of the Hofstede framework. His first version consisted of four dimensions (4D), whereas his current version consists of six dimensions (6D). Some authors still prefer older versions. For example, Cagliano et al. (2011) used the 4D framework, while at this time, Hofstede already released the new 6D framework. Finally, multiple authors have chosen to investigate only one or two dimensions of the framework. This column demonstrates that there is no standard regarding the measurement model for national culture.

The fifth column, 'method', displays whether the authors choose for the cultural dimensions as a moderator or as an antecedent of lean in their conceptual model. Note that the table describes the latter relation as mediation. The reason is that authors choose national culture as an antecedent of lean (or another practice) when they describe a direct relation and when they describe a mediation relation. These different models have the same theoretical implication about national culture. The only difference is that with a mediation relation, there is an indirect effect via a third variable as well. However, moderation has a different theoretical implication. The terminology mediation might seem confusing, but this is due to models of fit that are described by Venkatraman (1989). These models will be explained later in this paper. The column demonstrates that ten articles describe a mediating relation, whereas six articles describe a moderation relation.

(9)

9 The seventh and final column displays the dimensions that have been found to affect the improvement programs. This column also shows the direction of the effect (i.e., positive or negative). Note that the implications of a positive effect for a specific dimension are different for the mediation methodology than for the moderation methodology (the hypotheses development section will explain these different implications).

(10)

10

Authors Improvement

program

Cultural framework

Dimensions measured Method Effect

found?

Dimensions found effect Adam et al.

(2001) Quality practices None Comparison of two countries Mediator Maybe* None Bockstedt et al.

(2015) Innovation contests GLOBE Uncertainty avoidance and performance orientation

Mediator Yes Uncertainty avoidance (-) and performance orientation (+) Cagliano et al. (2011) New forms of work organizations

Hofstede 4D Mediator Yes Masculinity (-), uncertainty avoidance (-), power distance (-) and individualism (-)

Cheung et al.

(2010) Relationship learning Hofstede 5D – cultural distance Moderator No None Flynn & Saladin

(2006) Baldrige Quality Award Hofstede 4D Mediator Yes Power distance (+), uncertainty avoidance (+), masculinity (+) and individualism (-) Kull & Wacker

(2010) TQM GLOBE All Moderator Yes Uncertainty avoidance (+) and assertiveness (-)

Kull et al. (2014)

Lean GLOBE All Moderator Yes Uncertainty avoidance (+), assertiveness (-) and

future orientation (-)

Lagrosen (2003) TQM Hofstede 4D Mediator Yes Uncertainty avoidance (-) and individualism (-)

Matthews et al.

(2001) Quality practices Hofstede Power distance and uncertainty avoidance Mediator Yes Uncertainty avoidance (+/-) and power distance (+/-) Netland et al.

(2013) Lean Hofstede 5D Mediator No None

Netland (2016) Lean Hofstede Individualism –

comparison of two countries

Mediator No None

Power et al.

(2010) Lean Hofstede Individualism Mediator Yes Individualism (-)

Su & Chen

(2013) Learning mechanisms Hofstede Individualism Moderator Yes Individualism (-) Vecchi &

Brennan (2011) TQM GLOBE All Mediator Yes Uncertainty avoidance (-), institutional collectivism (-), performance orientation (-), power distance (+), future orientation (-)

Wiengarten et

al. (2015) Lean Hofstede Individualism Moderator Yes Individualism (-)

Wiengarten et

al. (2011) Quality practices Hofstede 4D Moderator Yes Individualism (-), Masculinity (-), Uncertainty avoidance (-)

(11)

11

2.4 Research hypotheses

This section will be dedicated to developing hypotheses and creating conceptual frameworks. First, the relations of the identified CSFs on the leanness of an organization will be described; after that, the effect of national culture will be discussed. By definition, CSFs should have a positive effect on the leanness of an organization. For the sake of simplicity, all relations from CSFs on the leanness of an organization will be summarized in one hypothesis. The objective of this study is to look into the effect of national culture, describing every single hypothesis regarding the direct effects will only complicate this article without adding any value. This hypothesis is foremost useful for confirming that the CSFs are indeed success factors, and thus have positive relations.

The following section will explain how these factors will result in a higher leanness of organizations. It should be noted that not all CSFs are being described. This is due to the use of an already existing database (the HPM project). Therefore, some CSFs could not be measured, which is a limitation of the study. Furthermore, some CSFs are lean practices. Increasing a lean practice will increase the leanness of an organization. However, this does not mean that it is a CSF. Ultimately, seven CSFs have been selected: management engagement and commitment, education and training, motivated personnel, empowered personnel, communication, rewards and recognition, and organizational infrastructure. The methodology section will further explain why these factors have been chosen. This sequence is unusual but can be explained by the use of an already existing database.

2.4.1 The CSFs of lean

According to Netland (2016), management engagement and commitment is seen as an essential CSF of lean by multiple authors. If management does not entirely engage in the implementation, they might intentionally or unintentionally sabotage the effect (Worley & Doolen, 2006). Not only does management provide an example for the other employees, but they also have the power to dedicate the necessary resources (both financial and human) to the lean implementation. These resources (which were also identified as a CSF of lean) are for instance required to provide employee training (Flynn, Schroeder, & Sakakibara, 1995). All with all management engagement and commitment is a necessity for increasing the leanness of an organization.

Training and education is about enhancing the knowledge and skills of employees. Increased lean knowledge and skills would logically result in a more successful lean implementation. Puvanasvaran, Megat, Hong & Razali (2009) stated that: 'In a lean production environment, training is pivotal in order to develop a workforce, which is capable of shouldering the increased responsibilities, to develop multi-skilled workers, and to create an environment in which workers have the skills and ability to push for continuous improvement.' Also, Bortolotti et al. (2015) concluded that successful lean plants use soft LM practices (which includes employees' training to perform multiple tasks) more extensively than unsuccessful lean plants. This description of training and education shows a close link to skills and expertise, which has led to the decision of using training and education as a CSF that also encompasses skills and expertise.

(12)

12 Furthermore, empowered personnel has been mentioned repeatedly in the literature. Bowen & Youngdahl (1998) explain that empowerment is necessary to cope with the vastly decreasing inventory buffers and with their increased responsibility for quality control and improvement. If there is a malfunction in the production line, employees have the responsibility and authority to stop the production line and focus on solving the problem. This way, the problem can be fixed faster than when management has to come in action, which diminishes the risk of empty buffers and inventories. It is therefore expected that empowered personnel will result in higher leanness.

Table 2.1 demonstrates that 7 out of 11 articles stated that communication is a CSF of lean. Worley & Doolen (2006) state that communication is vital in any organization, but particularly in lean environments, since it requires clear communication between all value streams. Koufteros, Nahm, Cheng, & Lai (2007) describe that communication is critical for lean practices such as pull production since organizational members depend on one another for the effective and efficient flow of information. Moreover, it has been explained that lean concerns a cultural change, where employees are the recipients. Puvanasvaran et al. (2009) argue that communication will lower their resistance to lean implementation, which thus increases the chances of success. Finally, communication is needed to spread the strategy and vision through the company. The failure of JIT implementation is often blamed on not adequately considering a coherent long-term manufacturing strategy (Bortolotti et al., 2015). Literature suggests that the clear communication of vision, plan, and strategy provides clarity, and thus direction for the improvement effort. This will ensure that employees do not lose focus and work towards a common goal.

Rewards and recognition are mentioned regularly in literature. They are said to enhance employee satisfaction and motivation (Danish & Usman, 2010). Rewards and recognition provide employees with an incentive to work towards the company goal. Rewards can both be financial and non-financial; either way, they are believed to help increase the leanness of an organization.

Finally, an appropriate organizational infrastructure has been mentioned as a requirement for the implementation of lean. Achanga et al. (2006) found that the most suitable structure would be a flexible structure. A flexible structure is characterized by a few hierarchical layers, also known as a flat structure. This CSF has resemblance with employee empowerment since a flat structure also allows faster decision making where required. Furthermore, it motivates employees, and top management can focus on strategic choices.

This section has described how the CSFs can help organizations to increase the leanness of their firms. The described effects are summarized in the following hypothesis:

Hypothesis 1: Higher levels of the CSFs of lean will result in higher leanness of an organization

As has been described at the beginning of this chapter, this research divides lean practices into soft and hard practices. The hard practices, which are the technical practices, are most mentioned in lean research. However, the soft practices seem to be important as well. Bortolotti et al. (2015) found that firms that successfully implement lean are using soft practices more extensively than unsuccessful lean firms. Rahman & Bullock (2005) proved that hard and soft practices have a positive effect on performance. They argued that soft practices have an indirect effect on performance through hard practices. They explain that hard practices may yield quality improvements, but ultimately, it is 'people that make quality happen.' Their findings suggest that an increase in the use of soft skills will lead to an increase in the hard practices, as is summarized by the following hypotheses:

(13)

13

2.4.2 National culture

The literature review on national culture showed that there are many inconsistencies when authors test the effect of national culture. This article is an effort to overcome these inconsistencies by using the theory of fit. The theory of fit suggests that there are multiple ways to model reality and that none of them will have a perfect match. The researcher must conceptualize reality in a way that has the best fit. Venkatraman (1989) is one of the authors that describes this theory and explains how an author can increase the level of fit. He emphasizes that multiple methods can be correct but that the conclusions of the research depend on the interpretation of these methods. Furthermore, he emphasizes that the underlying theory partially determines the correct model of fit. His article describes six conceptual methods, of which two are relevant for this research: fit as moderation and fit as mediation.

The first model of fit, fit as moderation, is related to contingency theory. According to this theory, the effect of a CSF on lean is contingent on national culture. In other words, when using fit as moderation, specific cultural dimensions would be more favorable for implementing lean. The second model of fit, fit as mediation, suggests that national culture would be an antecedent of CSFs, which mediates the effect between national culture and firm performance. This approach suggests that a cultural dimension (e.g., individualism) would affect a CSF (e.g., teamwork) directly, which is equally plausible. This approach has a closer link with institutional theory, which suggests that people act according to specific rules and norms, which differ per culture. For example, in an individualistic culture, people act out of self-interest, which leads to less teamwork. Using fit as mediation thus conceptualizes that a certain CSF is more common in a particular cultural dimension, as opposed to being more effective. So, using this theory, it is likely that some CSFs both have a significant mediation and moderation effect. It is, in fact, the correct interpretation of these results that will lead to a valuable discussion.

The problem in the current literature is that there are contradicting results regarding national culture. The first discrepancy is that some authors found national culture to be of importance for lean, while others say that it has no significant effect. One of the contributing factors to this inconsistency might be that fit as moderation and fit as mediation are being used interchangeably. As has been explained, fit as moderation and fit as mediation have a different meaning; however, both methods can prove that national culture affects lean. For this reason, when researching whether national culture affects lean, it is essential to test both frameworks. For example, Vecchi & Brennan (2011) looked into the direct effect of the GLOBE dimensions on TQM (fit as mediation). In their discussion, they explain that they have found multiple dimensions that affect TQM, which is correct. However, when elaborating on these results, they also state that these dimensions are favorable for applying TQM. The theory of fit states that this is inaccurate since they did not test the moderation effect.

The second discrepancy is that authors that do find an effect of national culture on lean show different results. The Japanese culture is often described as the most favorable culture for improvement programs since its origin lies in this country (e.g., Flynn & Saladin (2006)). Japan is characterized by a high level of masculinity (95), a high level of uncertainty avoidance (92), a high level of long-term orientation (88), an above-average value of power distance (54), a below-average level of indulgence (42), and a below-average level of individualism (46). However, not all authors agree. For example, Kull et al. (2014) argue that the Japanese culture is not ideal for lean and that this is the reason that Toyota separated its headquarters from Japan. They did not find a significant moderation effect by collectivism. Other papers, such as that of Wiengarten et al. (2011, 2015) state that a collectivistic culture results in a higher efficacy of lean implementation. To summarize, only looking at collectivism, the Japanese culture suggests that average levels of collectivism are most favorable, Kull et al. (2014) argue that collectivism does not affect lean, and Wiengarten et al. (2011, 2015) find that a collectivistic culture would result in higher efficacy of lean.

(14)

14 required. Two propositions are made, which differ from hypotheses since they do not suggest a direction. Both propositions will be tested, and the difference in results will be discussed in the discussion.

Proposition 1: National culture moderates the effect between the CSFs of lean and the leanness of an organization

Proposition 2: National culture both directly and indirectly affects the leanness of an organization, of which the indirect effect is through the CSFs of lean

Figure 2.1 and 2.2 summarize the described hypotheses, where figure 2.1 represents the fit as moderation model (proposition 1), and figure 2.2 represents the fit as mediation model (proposition 2).

Figure 2.1 - Conceptual model 1 (fit as moderation)

(15)

15

3. Methodology

3.1 Data collection and sample

This study is performed using data from the third round of the High-Performance Manufacturing (HPM) project. The HPM project is an effort of researchers to collect data from manufacturing plants across multiple countries. It is used to analyze the performance of different improvement practices. Round 3 of this project consists of 10 countries, namely Austria, China, Finland, Germany, Italy, Japan, South Korea, Spain, Sweden, and the USA. These countries were selected to control for cultural and economic diversity. Furthermore, these countries contain both high performing and traditional plants. Large plants (more than 100 employees) were randomly selected from a local database. All the plants operated in the mechanical, electronics, and transportation equipment sector. In each country, local research teams were responsible for selecting the plants, distributing the questionnaires, and collecting the data. The questionnaire was created in English but is translated into the native language by a local. Plant representatives received the questionnaire and were responsible for the distribution of different players within the company. Different functions within the companies received different versions of the questionnaire (i.e., managers received a different questionnaire than floor workers). This way, the chances of common method bias are reduced. The survey includes objective and perceptual measures. The questionnaires were collected in sealed envelopes and translated back to English by different translators to ensure accuracy. Ultimately, 317 plants sent a response, which equals a response rate of 65%. Table 3.1 shows the distribution of the sample.

Country Industry Number Percentage

Electronics Machinery Transportation

Austria 10 7 4 21 7% China 21 16 14 51 16% Finland 14 6 10 30 9% Germany 9 13 19 41 13% Italy 10 10 7 27 9% Japan 10 12 13 35 11% South Korea 10 10 11 31 10% Spain 9 9 10 28 9% Sweden 7 10 7 24 8% USA 9 11 9 29 9% Number 109 104 104 317 Percentage 34% 33% 33% 100%

Table 3.1 - Distribution of the sample

3.2 Variables and scales

This article uses perceptual measures for the measurement of the leanness of an organization and the CSFs. A 7-point Likert scale is used to operationalize the perceptual items, ranging from 1 ('strongly disagree') to 7 ('strongly agree'). Some items are reverse coded to reduce the chance of common method variance (Bortolotti, Danese, Flynn, & Romano, 2015).

(16)

16

Soft lean practices Hard lean practices

Supplier feedback JIT delivery by suppliers (JIT) Supplier development Pull production (JIT)

Customer involvement Continuous flow (JIT) Employee involvement Set up time reduction (JIT)

Total productive maintenance (TPM) Statistical process control (TQM) Table 3.2 - Division of lean practices

The four bundles (soft practices, TQM, TPM, and JIT) represent the second-order constructs. Their underlying items can be found in appendix A. The list in the appendix includes items that were disposed of due to reliability and validity issues; these items are marked with an X in the final column. Furthermore, supplier development and supplier feedback are merged into one first-order construct, since the measurement items are highly similar.

The literature review described a total of 21 CSFs, yet only seven will be measured. Primarily, since some identified CSFs are lean practices. For example, increasing the linkage to customers will increase the leanness of an organization, since customer involvement is defined as a lean practice. Furthermore, many CSFs are closely related. For example, emphasize safety and job attractiveness will result in motivated personnel. Therefore, testing both factors will result in discriminant validity issues. It is believed that testing more CSFs will only lead to unnecessary complications in the conceptual model, instead of providing clarification towards the research question (which is about the effect of national culture). Finally, some CSFs could not be measured since no matching data is available in the dataset. Even though this is a limitation to this study, it is thought that it will not influence the results, since this concerns only three factors. Furthermore, the CSFs that are mentioned most in the literature are included in the research. The first column of Table 3.3 lists the CSFs that will not be used, whereas the second column provides argumentation for their disposal.

Dismissed CSF Motivation

Linking to supplier Measure of lean

(supplier feedback, supplier development and JIT delivery by

supplier)

Linking to customer Measure of lean

(customer involvement) Performance measurement Measure of lean

(statistical process control) Use of lean tools and methods Measure of lean

(combination of all practices) Vision and plan statement Strong relation to communication Linking to business strategy Strong relation to communication

Teamwork Strong relation to communication

Available resources Strong relation to management engagement and commitment Supportive organizational culture Strong relation to management engagement and commitment Skills and expertise Strong relation to education and training

Emphasize safety and job attractiveness

Strong relation to motivated personnel Project prioritization, selection, review

and benchmarking

No data available Use external experts No data available

(17)

17 For most CSFs corresponding measurement items could be found in the HPM project. Other factors needed proxies since no matching data was available. Communication is one of these factors; hence integration is used as a proxy. Integration is being measured in the same way as similar research by Turkulainen & Ketokivi (2012). Commitment is used as a proxy for motivated personnel. Commitment and motivation are not the same; however, the difference is so small that it is believed to be an adequate proxy. Finally, the extent to which authority in a firm is decentralized measures the CSF empowered personnel. All other variables did not need proxies. The complete overview of the measurement items can be found in Appendix B.

The final variable, national culture, is the only variable that is not measured with data from the HPM project. The scores for each country have been extracted from Hofstede’s official website. Table 3.4 displays these dimensional scores.

Country Power

distance

Individualism Masculinity Uncertainty avoidance Long-term orientation Indulgence Austria 11 55 79 70 60 63 China 80 20 66 30 87 24 Finland 33 63 26 59 38 57 Germany 35 67 66 65 83 40 Italy 50 76 70 75 61 30 Japan 54 46 95 92 88 42 South Korea 60 18 39 85 100 29 Spain 57 51 42 86 48 44 Sweden 31 71 5 29 53 78 USA 40 91 62 46 26 68

Table 3.4 - Hofstede's cultural dimension scores per country

3.3 Reliability and validity

The HPM project scales are based on literature, which helps to improve the content validity of the data. Experts and managers provided feedback in order to ensure content validity further. Finally, the scales were pilot tested in each country, to ensure the understandability and the accuracy of the translated questionnaires.

In order to test the different validity and reliability aspects, confirmatory factor analysis was performed using Amos 25.0. Initially, all measurement items shown in Appendix A and B were included. Since the suggested cut-off values for reliability and validity were not met, items were iteratively deleted. This process was continued until all criteria were within the suggested limits.

(18)

18 Construct Mean (µ) SD (σ) Cronbach's alpha JIT 4.33 0.74 0.827 Soft practices 5.34 0.50 0.779 TQM 4.71 1.02 0.923 TPM 4.94 0.67 0.756

Rewards and recognition 4.49 1.07 0.935

Motivated personnel 5.20 0.62 0.921 Communication 5.26 0.66 0.918 Management engagement and commitment 5.64 0.63 0.859 Empowered personnel 4.54 0.89 0.866 Organization infrastructure 4.36 1.05 0.895

Education and training 5.27 0.70 0.88

Table 3.5 – Mean, standard deviation and reliability scores of the constructs

In order to ensure convergent validity, items had to load into their first order factors with satisfactory scores. Furthermore, first-order factors had to load significantly into the second-order codes. Appendix A and B show the factor loadings scores of the items. The values ranged from 0.53 to 1.00. This paper uses the suggested cut-off value of 0.50 from Anderson, Kellogg, & Gerbing (1988). Therefore, all items meet the thresholds.

Finally, in order to ensure discriminant validity, the square root of the average variance extracted (AVE) should be higher than their correlation coefficients with the other constructs. Table 3.6 shows these values. Bold values represent the square roots of the AVEs, and the italic values represent the correlation coefficients. The data shows no signs of discriminant validity issues.

3.4 Data analysis

(19)

19

Constructs JIT Soft

practices TQM TPM Rewards and recognition

Motivated

personnel Communication Management engagement and

commitment

Empowered

personnel Organization infrastructure Education and training

JIT 0.793 Soft practices 0.584 0.737 TQM 0.357 0.570 0.895 TPM 0.425 0.530 0.278 0.713 Rewards and recognition 0.528 0.391 0.322 0.413 0.91 Motivated personnel 0.370 0.605 0.133 0.431 0.348 0.837 Communication 0.435 0.545 0.373 0.553 0.432 0.499 0.807 Management engagement and commitment 0.461 0.706 0.367 0.365 0.343 0.363 0.556 0.744 Empowered personnel -0.075 0.369 0.09 0.263 0.013 0.286 0.212 0.117 0.827 Organization infrastructure -0.014 0.336 0.01 0.193 0.095 0.250 0.180 0.176 0.548 0.861 Education and training 0.532 0.631 0.371 0.414 0.640 0.511 0.441 0.468 0.297 0.266 0.806

(20)

20

4. Results

This section will provide the test results for the structural equation models. The first section will show the results of the effects from the CSFs on the leanness of an organization (i.e., H1) and the effect from the soft practices on the hard practices (i.e., H2). The second section will provide the results for the effect of national culture (i.e., P1 and P2). Afterward, the discussion will give meaning to these results by clarifying the implications of significant relations. The results in this section are only shown if their p-value is below 0.10.

4.1 Hypotheses testing

As can be seen in figure 4.1, two factors prove to have only positive effects on lean bundles. Management engagement and commitment has a significant positive effect on soft practices (ß=0.290, p<0.01). Education and training show similar results. This CSF has a significant positive effect on soft lean practices (ß=0.120, p<0.01).

The results of the third CSF, motivated personnel, are more complicated. The results show that this factor is a CSF of soft practices (ß=0.178, p<0.001), on the other hand, it has a strong negative effect on TQM (ß=-0.372, p<0.001). Empowered personnel similarly has both positive and negative effects. This CSF seems to have a positive effect on both soft practices and TPM (ß=0.072, p<0.05 and ß=0.076, p<0.10). As opposed to having a detrimental effect on JIT practices (ß=-0.101, p<0.05).

Having an appropriate organizational infrastructure does not have any significant positive relations. Moreover, this CSF seems to harm TQM practices (ß=-0.129, p<0.05). Communication and rewards and recognition have multiple positive effects on the leanness of an organization. Communication positively affects TQM and TPM (ß=0.304, p<0.01 and ß=0.265, p<0.01). Rewards and recognition have a positive effect on all hard lean practices: TQM (ß=0.102, p<0.10), TPM (ß=0.125, p<0.01) and JIT (ß=0.162, p<0.10).

Organizational infrastructure is the only CSF that does not prove to have a positive effect on any lean bundle. According to the analysis, it cannot be confirmed that organizational infrastructure is a CSF of lean. For this reason, it will not be used for testing the effects of national culture.

Furthermore, the theory suggested that the use of soft practices would lead to more hard practices. Soft practices have a strong positive effect on TQM (ß=0.860, p<0.01). Furthermore, soft practices seem to have a positive influence on both TPM and JIT (ß=0.222, p<0.01 and ß=0.348, p<0.01).

Finally, it should be noted that CSFs can also have an indirect effect on hard practices via soft practices. Table 4.1 displays the significant indirect and total effects (which is the combined direct and indirect effect). Management engagement and commitment, education and training, motivated personnel, and empowered personnel have significant positive indirect results on all hard practices. Appropriate organizational infrastructure, communication, and rewards and recognition do not have any significant indirect effects (since they do not affect soft practices directly). These indirect effects are vital since they might affect the total effects. For example, empowered personnel proves to have a direct negative effect on JIT practices (ß=-0.101 and p<0.05). In contrast, the indirect effect on JIT practices is positive (ß=0.028, p<0.01). In total, empowered personnel does not prove to have a significant effect on JIT practices.

(21)

21 Figure 4.1 - Results of direct structural equation model * p<0.10, ** p<0,05, *** p <0,01

(22)

22

CSF

Lean bundle

Direct effect

Indirect effect Total effect

Management

engagement and

commitment

TPM

0.064***

TQM

0.249***

0.254**

JIT

0.111***

0.129*

Education and

training

TPM

0.027**

TQM

0.103***

0.262**

JIT

0.046**

0.159**

Motivated

personnel

TPM

0.040***

0.129**

TQM

-0.372***

0.153***

-0.218**

JIT

0.069***

Empowered

personnel

TPM

0.076*

0.016**

0.092**

TQM

0.062***

JIT

-0.101**

0.028***

Appropriate

organizational

infrastructure

TPM

TQM

-0.129**

-0.218*

JIT

Communication TPM

0.265***

0.272***

TQM

0.304***

0.331***

JIT

Rewards and

recognition

TPM

0.125***

0.126***

TQM

0.102*

JIT

0.162***

0.163***

(23)

23

4.2 Propositions testing

In order to test Propositions 1 and 2, a separate structural equation model has been developed for each cultural dimension. Due to the complexity of the conceptual model, it was not feasible to include all cultural dimensions into one structural equation model. First of all, by doing so, the model became too hefty to run. Secondly, increasing the number of interaction effects in a single model would decrease the model fit, resulting in unsatisfactory fit indices. For these reasons, instead of running one model, six models have been tested (i.e., one model for each dimension). Figure 4.2 is an example of a tested model. Note that the upper part represents proposition 2 (fit as mediation), and the lower part represents proposition 1 (fit as moderation). Furthermore, the results of the models will be shown in tables instead of in structural equation models. It is believed that this provides a better overview since only two tables will be needed instead of six figures. Finally, table 4.2 gives an overview of the model fit indices and R² of all structural equation models. As can be seen from the table, all indices are above the suggested thresholds.

(24)

24

Model χ2_/df _CFI _TLI _GFI _{RMSEA R² soft R² TPM R² TQM R² JIT}

Power distance 1.868 0.979 0.929 0.972 0.052 0.49 0.31 0.31 0.28 Individualism 2.226 0.968 0.895 0.965 0.062 0.51 0.32 0.34 0.29 Masculinity 1.977 0.971 0.904 0.969 0.056 0.5 0.34 0.35 0.25 Uncertainty avoidance 2.303 0.965 0.881 0.967 0.064 0.51 0.3 0.32 0.24 Long-term orientation 2.126 0.97 0.899 0.969 0.06 0.52 0.3 0.34 0.26 Indulgence 1.825 0.978 0.924 0.973 0.051 0.5 0.31 0.34 0.27

Table 4.2 - Model fit indices and R² of national culture models

4.2.1 Proposition 1 – fit as moderation

The first proposition suggested that national culture moderates the effect from the CSFs on lean

practices. Table 4.3 provides an overview of the moderation effects on all relations between the

CSFs and the lean practices. A total of 19 moderation effects have been found at a significance

level of p<0.10, of which 12 were significant at the p<0.05 level. Two of the moderation effects

met the p<0.01 threshold.

A first look at the table shows that each cultural dimension moderates at least one relation. Only

the results for uncertainty avoidance can be doubted, since just one significant effect at the

p<0.10 level has been found. Individualism seems to be the cultural dimension that has the most

effect on lean as a moderator. Surprisingly, the two newer dimensions (long-term orientation

and indulgence) show the second and third most moderation effects, while the literature does

not mention these dimensions that often.

Approaching the moderation from the perspective of the CSFs, the same conclusion can be

drawn. The effect of each CSF on a lean practice is moderated by at least one cultural

dimension. However, communication shows that only its relation to soft practices is being

moderated by long-term orientation at the p<0.10 significance level. Rewards and recognition,

management engagement and commitment, and empowered personnel seem to be most

sensitive to moderation effects.

The final perspective, which is that of the lean bundles, show that the soft practices and TQM

bundle are most sensitive to moderation effects. They show seven and eight moderation effects,

respectively. JIT (zero moderation effects) and TPM (one moderation effect) seem to be less

affected by national culture as a moderator.

(25)

25

Critical success factors (independent variable)

Cultural dimension

(moderator)

Bundle

(dependent

variable)

Rewards and

recognition

Education

and training Communication

Empowered

personnel

Motivated

personnel

Management

engagement and

commitment

Power distance

Soft

-0,130**

TPM

TQM

-0,110**

JIT

Individualism

Soft

-0,121**

0,105*

TPM

TQM

0,156**

-0,106**

0,106**

JIT

-0,164**

Masculinity

Soft

0,103*

TPM

TQM

-0,122**

0,162***

JIT

Uncertainty avoidance Soft

TPM

TQM

0,117*

JIT

Long-term orientation Soft

0,149***

-0,099*

TPM

TQM

-0,119*

JIT

Indulgence

Soft

0,121**

TPM

0,108*

0,091*

TQM

0,106**

JIT

(26)

26

4.2.2 Proposition 2 – fit as mediation

The second proposition suggested that national culture, directly and indirectly, affects the leanness of an organization, of which the indirect effect is through the CSFs of lean. Table 4.4 displays all significant effects. Note that the total effect indicates whether the combined direct and indirect effect of national culture significantly affects the leanness of an organization. This cumulative effect does not include the moderation effect since that is a separate variable in the structural equation model (interaction variable). Table 4.4 shows that the analysis proved that multiple effects were significant. 11 direct, nine indirect and 11 total significant effects have been found out of 24 possibilities (six dimensions * four bundles). Twenty-seven of these effects were significant at the p<0.05 level, of which 20 were significant at the p<0.01 level.

Comparable to the results of proposition 1 (fit as moderation); individualism, long-term orientation, and indulgence are the dimensions that prove to have the most influence on lean implementation. From the perspective of the lean bundles, it becomes clear that the soft practices are most sensitive to the direct and indirect effects of national culture (11 out of 18 possible relations were significant at the p<0.05 level). However, the other bundles show many significant results as well.

Finally, Appendix C presents other results that are not highly relevant for this research, but that will add value to the managerial implications. The results in this appendix represent the direct effects of national culture on the CSFs of lean. These effects indicate whether some CSFs are being used more in specific cultural dimensions. Even though this information might be useful to some, it does not help in clarifying the effect of national culture on the leanness of an organization.

(27)

27

Cultural dimension Bundle Direct effect Indirect effect Total effect

Power distance Soft -0,215*** -0,131**

TPM TQM JIT 0,209*** 0,222*** Individualism Soft 0,178*** TPM -0,204*** 0,134*** 0.177*** TQM -0,187*** -0,154** JIT Masculinity Soft -0,120*** TPM -0,170*** 0,055* -0,115* TQM JIT 0,078**

Uncertainty avoidance Soft -0,182*** -0,157**

TPM

TQM 0,116**

JIT

Long term orientation Soft -0,104** -0,113*** -0,217***

TPM 0,070* TQM 0,198*** 0,135** JIT Indulgence Soft 0,135*** 0,152** TPM 0,083* TQM -0,177*** -0,140*** JIT -0,177*** -0,215***

(28)

28

5. Discussion

The vast number of results complicates their interpretation. This section will provide clarity by discussing the implications of the findings, which will bring about an answer to the research question:

'How does national culture influence the effect of CSFs on the leanness of an organization?’. The first

part will discuss the first two hypotheses, which are regarding the effects of the CSFs and the lean bundles. After that, the theory of fit will be used to discuss the two propositions concerning national culture. The end of this chapter will describe the managerial implications and limitations of this study.

5.1 Critical success factors and lean bundles

The selection process of CSFs was based on multiple articles. Most of these articles used qualitative methods to identify the factors. It is therefore essential to quantitatively confirm that these factors are indeed success factors. Otherwise, the results of national culture will not make sense. The factors will be confirmed by looking into the results of the direct, indirect effects and total effects of the CSFs on the leanness of an organization.

Based on the results, four CSFs could instantly be confirmed as CSFs of lean: rewards and recognition, education and training, communication, and management engagement and commitment. These CSFs all showed significant positive effects to at least one lean bundle. Furthermore, these factors did not show any significant negative effects. It should be noticed that these factors are CSFs of lean; however, this does not mean that they are CSFs for each lean bundle.

Two factors showed both positive and negative significant direct effects on lean bundles. The first factor, empowered personnel, has a positive effect on soft practices (ß=0.072, p<0.05), a positive effect on TPM (ß=0.076, p<0.10) and a negative effect on JIT (ß=-0.101, p<0.05). However, this negative effect on JIT is countered by a positive indirect effect via soft practices (ß=0.028, p<0.01). The total effect of empowered personnel on JIT practices is therefore not significant, leaving only significant positive effects on the leanness of an organization. For this reason, it can be concluded that empowered personnel is a CSF of lean. The second factor, motivated personnel, has a significant positive effect on soft practices (ß=0.178, p<0.01) and a significant negative effect on TQM (ß=-0.372, p<0.01). The indirect positive effect on TQM via soft practices (ß=0.153, p<0.01) partly neutralizes the negative effect. However, the total effect is still negative (ß=-0.218, p<0.05). For this reason, motivated personnel can both be a barrier or a success factor for lean, depending on which lean bundles are used more extensively in the firm.

The final factor, having an appropriate organizational infrastructure, did not show any significant positive relations with the lean practices. Moreover, it showed a negative direct relation with TQM (ß=-0.129, p<0.05). The total effect of organizational infrastructure on TQM was negative as well (ß=-0.218, p<0.1). Therefore, having an appropriate organizational infrastructure cannot be confirmed as a CSF of lean. This factor even seems to be a barrier to TQM implementation.

The first hypothesis stated: 'Higher levels of the CSFs of lean will result in higher leanness of an

organization.' The discussion explains that having an appropriate organizational infrastructure cannot

be confirmed as a CSF. The other factors did prove to have a positive effect on lean. All with all, hypothesis one can partly be confirmed. The second hypothesis stated: 'Higher levels of soft lean

practices will result in higher levels of hard lean practices.' This hypothesis can be confirmed. The

result section shows strong positive effects from the soft practices to all the hard practices.

(29)

29 organizational infrastructure has been operationalized as the flatness of the organization. A flat organization was suggested to be more effective for lean since it allowed faster decision making and could increase employee motivation (Achanga et al., 2006). Then again, these assumptions are made based on JIT practices and soft practices. The relations of organizational infrastructure to these practices did not show a significant effect, while it did show a negative effect on TQM practices. Therefore, the conclusion can be drawn that a flat infrastructure is not the most appropriate for TQM practices, while it cannot be proved that it is most effective for the other lean practices. The second factor that could not be confirmed to be a CSF of lean is motivated personnel. This is more surprising since 8 out of 11 articles mentioned motivated personnel as a CSF of lean. The factor did prove to affect the soft practices positively. However, it seemed to have a detrimental effect on TQM practices. Instinctively this makes no sense; it makes more sense that TQM lowers the motivation of personnel since TQM is a formal procedure, which leaves little room for proactivity and creative solutions of employees. Therefore, it is believed that the results may be misleading and that motivated personnel does not result in less TQM practices. If this is true, motivated personnel will still be a CSF of lean, since it positively affects soft practices. Another surprising finding is the negative effect of empowered personnel on JIT. Empowered personnel is often mentioned as a CSF of JIT (e.g., Hu et al., 2015) since it allows floor workers to respond to abnormalities quickly. This is extra important for companies making use of the JIT philosophy since they usually have lower inventory levels (Bowen & Youngdahl, 1998). Abnormalities, such as defects, can quickly empty these inventories, which results in significant problems. One explanation for the negative relation might be that empowered personnel is operationalized as decentralization of authority, which is a proxy for empowered personnel. However, the finding remains inconsistent with literature, and it must be concluded that it might be inaccurate. Empowered personnel can still be confirmed as a CSF of lean since the negative direct effect on JIT is countered by the positive indirect effect via the soft practices.

Finally, the results add to the current literature by stressing the importance of the indirect effects. If researchers measure lean in terms of multiple bundles or practices, they should account for the relations between these bundles or practices. By doing so, it becomes possible to test indirect effects, which can determine the outcome of the results. This is caused because the opposite effects can cancel each other out. This phenomenon is visible at the direct and indirect effects of empowered personnel on JIT practices. The negative direct effect gets canceled out by the positive indirect effect, resulting in no significant total effect.

5.2 Fit as moderation

Two propositions and relating conceptual frameworks have been developed in the literature review: fit as moderation and fit as mediation. This paragraph will discuss the first. Proposition 1 stated: 'National

culture moderates the effect between the CSFs of lean and the leanness of an organization.' The literature

section explained that the implication of national culture as a moderator is based on the contingency theory. In other words, the strength of the effect of the CSFs of lean on the leanness of an organization is dependent on national culture. This means that the use of CSFs would have more effect on the leanness of an organization in specific cultures. Table 4.3 showed the results from the moderation effects. This section will first elaborate on these results and then compare them to the literature.

(30)

30 in a culture that is characterized by high uncertainty avoidance will be extra productive for the implementation of TQM. For the total effect on lean, it will be concluded that this effect is negligible. Individualism, masculinity, and long-term orientation showed mixed positive and negative moderation effects. For these dimensions, it is difficult to say whether they have a positive or negative total moderation effect. The reason therefore is that opposite effects will neutralize each other. For example, individualism shows a positive (ß=0.105, p<0.10) and a negative (ß=-0.121, p<0.05) moderation effect on soft practices, resulting in an insignificant total moderation effect on soft practices. It might be useful information to know which CSF is more effective in that individualistic culture, but it is difficult to say whether an individualistic culture is more useful for the implementation of soft practices. This same phenomenon of opposite effects that cancel each other out happens on a different level. Instead of different moderation effects within a bundle, the total effects of the bundles can cancel each other out as well. All the moderation effects of individualism on the relations with TQM are positive (or negative moderation on negative direct effect). Hence an individualistic culture is more effective for the implementation of TQM practices. All the moderation effects of individualism on the relations with JIT are negative. Hence an individualistic culture is less effective for the implementation of JIT practices. These opposing moderation effects on TQM and JIT cancel each other out, proving no significant total moderation effect of individualism on lean. Following the same explanation, the total moderation effect of masculinity and long-term orientation on the total leanness of a firm is insignificant. Nevertheless, using a more detailed lens, multiple significant effects have been found on the lean bundles and the CSFs.

(31)

31 power distance and high indulgence. However, it is crucial to keep the scope in mind. The discussion demonstrated that the opposing effects could result in insignificant total effects.

5.3 Fit as mediation

The second conceptual model demonstrated the fit as mediation framework. The corresponding proposition was the following: 'National culture both directly and indirectly affects the leanness of an

organization, of which the indirect effect is through the CSFs of lean.' The following section will discuss

the results, after which they will be compared to the literature.

Table 4.4 displays the significant direct, indirect, and total effects of national culture on the lean bundles. When only a direct effect is significant, the implication is that the use of that lean bundle is more or less common in that cultural dimension. Full mediation (i.e., only an indirect effect is significant) indicates that the use of the CSFs for a particular lean bundle is more common in that cultural dimension. Total effects are the combined direct and indirect effects.

The articles studied in the literature review that used the fit as mediation approach looked into the direct effect of national culture on lean. This effect is more important for managers than the indirect effect, the reason being that managers can then apply this knowledge to use lean practices that are more natural in their country more extensively. This way, employees will feel comfortable working with these lean practices. The following conclusion can be drawn based on the direct effects: Cultures characterized by high power distance, low individualism, low masculinity, and low indulgence stimulate the use of lean. For uncertainty avoidance and long-term orientation, the results are insignificant, since the opposing results cancel out.

Important to notice is that the scope again determines whether one finds significant results. For example, this article also focuses on the indirect and total effect. With partial mediation (i.e., an indirect and a direct effect are significant), one should be wary that the total effect may be canceled out. For example, masculinity has a direct negative effect on TPM (ß=-0.170, p<0.01) and an indirect positive effect on TPM (ß=0.055, p<0.10). The small indirect effect counters part of the direct effect, resulting in a cumulative effect of -0.115 that is only significant at the p<0.10 level. On the other hand, a significant total effect may occur where no significant direct effect has been found since there is an indirect effect (e.g., the effect of power distance on soft practices). In this case, it will be inaccurate to conclude that national culture does not affect lean. To conclude, the results show that authors should be aware of their scope when drawing conclusions with regards to national culture and lean.

The effect of national culture on the critical success factors of lean: overcoming disagreement