Lean Manufacturing and Profitability of Manufacturing Firms in Uganda

Abstract

This study was carried out to following the new wave of lean manufacturing within manufacturing firms in Uganda. The main aim was to establish whether the lean manufacturing indeed had any influence on the level of profitability and hence business continuity and success. The unit of analysis was composed of a set of manufacturing firms in Uganda engaging in production of goods for sale within and outside the country. Two respondents were selected from each of the 80 (sample size) manufacturing firms. Data collection was carried out by means of a questionnaire which was self administered by the respondents. Correlation and regression analyses were carried out to address the main aim of the study. Findings indicated that lean manufacturing within manufacturing firms in Uganda had a positive correlation with increase in profitability levels. Additionally, the lean strategies were found to have a positive influence of up to 41.4% of the changes in levels of profitability in Uganda. With these findings, it is recommended that manufacturing firms in Uganda already practicing lean manufacturing strategies should continue doing so. Likewise, those manufacturing firms that have not yet started practicing manufacturing, they should prepare to do in order to tap the positive benefits the strategies can have as far as increase in profitability is concerned. This however should be in line with other factors that significantly impact the level of profitability in these manufacturing entities in Uganda.

Keywords: Lean manufacturing, profitability