Applying lean thinking: a case study of an Indian steel plant

Supply chain management techniques have proved to be a competitive weapon for many companies in a broad range of sectors. Up until recently, published examples of these companies have been based in the developed world. Increasingly, these techniques are being transferred to the developing world to improve competitiveness, particularly within domestic markets. This paper adopts an action research-based methodology to demonstrate the level of gains that can be achieved in such countries. A case study of a steel company is presented. Through the application of some aspects of lean thinking, it is shown that per annum production costs can be reduced by 8% of turnover, while capital equivalent to 3.5% of turnover can be released through the removal of inventory. A lead time reduction of 50% is also achieved.