Lean Principles, Learning, and Software Production: Evidence from Indian Software Services

Abstract

While the concepts of lean production are frequently applied in service organizations there is little work that rigorously has examined implementing lean production in contexts other than manufacturing as well as lean production's impact on performance in these settings. In this paper we set out to accomplish both tasks by investigating the implementation of a lean production system at an Indian software services firm. Combining a detailed case study and empirical analysis we document the internal processes that the lean initiative influences. We find that lean projects perform better than the non-lean projects in our sample in many, but not all cases. Building on this result we see that the impact of the techniques on problem solving, coordination, and standardization of work improve the way that the firm learns as well as its productivity. In so doing, we gain insight into how a company can build an operations-based advantage.