Organisations are microcosms of society. They are our source of niche as well as our source of scourge (Chidi & Ogunyomi, 2010). What a paradox? It is a truism that organisations are the dominant feature of our society. According to Etzioni (1964, p.1), "our society is an organisational society. We are born in organisations, educated by organisations, and most of us spend much of our lives working for organisations. We spend much of our leisure time paying, playing, and praying in organisations. Most of us will die in an organisation, and when the time comes for burial, the largest organisation of all- the State must grant official permission". "Organisations are social units (or human groupings) deliberately constructed and reconstructed to seek specific ends or goals" (Etzioni, 1964, p.2). For organisations to meet their goals, they should be able to attract qualified and competent human capital. There is a popular maxim that the human capital is a source of competitive advantage. This is the view of the resource-based theory. The focus of this study is on recruitment and selection which are subsets of human capital resourcing practices; and to examine their relationship with organisational performance. Organisational performance has been the focus of intensive research efforts in recent times. How well an organisation implements its policies and programmes and accomplishes its strategic intent, in terms of its mission and vision is of paramount concern. Managers and administrators in both private and public organisations are becoming increasingly aware that a critical source of competitive advantage does not often come from product and services, best public relations strategy or state-of-the-art technology but from having an appropriate system of attracting and managing the

Many scholars have viewed the concept of organisational performance from different perspectives, and this has been problematic since there are no universal or unified criteria for measuring the concept of organisational performance. Researchers have used financial

organisation's human resources (Oladipo & Abdulkadir, 2011).

**1. Introduction**

Wood, S., Wagner, A., Armstrong, E., Goodman & Davis, E. (1975). "Industrial Relations Systems as a Basis for Theory in Industrial Relations". *British Journal of Industrial Relations* Vol. 13 N0 3, pp 291-308

### **Human Capital Resourcing Practices and Organisational Performance: A Study of Selected Organisations in Lagos State, Nigeria**

Christopher Odogwu Chidi1 and Okwy Peter Okpala2 *1Department of Industrial Relations & Personnel Management University of Lagos, 2Department of Accounting, University of Lagos, Nigeria*

#### **1. Introduction**

278 Theoretical and Methodological Approaches to Social Sciences and Knowledge Management

Waters, D. (1998). *Essential Quantitative Methods: A Guide for Business.* New York: Addison

Wood, S., Wagner, A., Armstrong, E., Goodman & Davis, E. (1975). "Industrial Relations

Systems as a Basis for Theory in Industrial Relations". *British Journal of Industrial*

Wesley Longman Ltd.

*Relations* Vol. 13 N0 3, pp 291-308

Organisations are microcosms of society. They are our source of niche as well as our source of scourge (Chidi & Ogunyomi, 2010). What a paradox? It is a truism that organisations are the dominant feature of our society. According to Etzioni (1964, p.1), "our society is an organisational society. We are born in organisations, educated by organisations, and most of us spend much of our lives working for organisations. We spend much of our leisure time paying, playing, and praying in organisations. Most of us will die in an organisation, and when the time comes for burial, the largest organisation of all- the State must grant official permission". "Organisations are social units (or human groupings) deliberately constructed and reconstructed to seek specific ends or goals" (Etzioni, 1964, p.2). For organisations to meet their goals, they should be able to attract qualified and competent human capital. There is a popular maxim that the human capital is a source of competitive advantage. This is the view of the resource-based theory. The focus of this study is on recruitment and selection which are subsets of human capital resourcing practices; and to examine their relationship with organisational performance. Organisational performance has been the focus of intensive research efforts in recent times. How well an organisation implements its policies and programmes and accomplishes its strategic intent, in terms of its mission and vision is of paramount concern. Managers and administrators in both private and public organisations are becoming increasingly aware that a critical source of competitive advantage does not often come from product and services, best public relations strategy or state-of-the-art technology but from having an appropriate system of attracting and managing the organisation's human resources (Oladipo & Abdulkadir, 2011).

Many scholars have viewed the concept of organisational performance from different perspectives, and this has been problematic since there are no universal or unified criteria for measuring the concept of organisational performance. Researchers have used financial

Human Capital Resourcing Practices and Organisational Performance:

employment and those who will not"

industry in Lagos State, Nigeria.

**2. Literature review**

underpinnings of the study.

**Resource-based view or theory**

A Study of Selected Organisations in Lagos State, Nigeria 281

announcing job vacancies with a view to attracting a pool of qualified applicants to fill up vacancies in an organisation. It is regarded as a positive process. According to Etomi (2002), recruitment is concerned with the process of attracting a sufficient number of individuals with the right profile in terms of qualifications, experience, skills and other relevant attributes to indicate their interest in working for an organisation. Recruitment is the process of generating a pool of qualified applicants for organisational jobs (Mathias & Jackson, 2004). Selection is the process of evaluating those who have been searched for and obtained through recruitment with a view to deciding whether they can be employed or not. It is also the process of choosing the individual or individuals who best meet the job-related criteria. "Selection is a decision-making activity: the psychological calculation of suitability" (Price, 2004, p.408). According to Yoder and Staudohar (1982, p.169) "selection is the process in which candidates for employment are divided into two classes – those who will be offered

The objective of this paper is to examine human capital resourcing practices and organisational performance in selected organisations in the food, beverage and tobacco

Attempt is made to review some theoretical and conceptual issues, as well as empirical studies germane to human capital resourcing practices. Human capital is the bedrock upon which all other organisational resources rest upon. Bontis, Dragonetti, Jacobsen and Roos (1999) view human capital as representing the human factor in the organisation; the combined intelligence, skills and expertise that gives the organisation its distinctive character. The human elements of the organisation are those that are capable of learning, changing, innovating and providing the creative thrust which if properly motivated can ensure the long-term survival of the organisation. According to Armstrong (1998), the word resourcing describes what managers need to do to ensure that they get the people they want in terms of numbers, skills and capabilities. This entails forecasting requirements, job analysis, recruitment and selection. Price (2004) views employee resourcing (human capital resourcing) as the process by which people are identified and allocated to perform necessary work. Thus, resourcing has two strategic imperatives: first is to minimise employee costs and to maximise employee value to the organisation; and secondly to obtain the correct behavioural mix of attitude and commitment in the workforce. Katou (2008) views human capital resourcing as comprised of recruitment, selection, separation and flexible work arrangements. This study leans on the following theories; the resource-based view or theory, contingency theory, universalistic theory and decision-making theory. Theoretical framework provides the explanations on which a study is based (Oyeniyi, 2006). What follows is an examination of the theoretical

Human resource has been regarded as an important factor for an organisation to gain competitive advantages and realise organisational goals or targets as advanced by the resource-based theory (Barney, 2001). This theory holds the view that the strategic

and non-financial metrics to measure organisational performance. Financial measures include profit, sales, and market share. Non-financial measures include output or productivity, quality, efficiency, and the attitudinal and behavioural measures such as commitment, intention to quit, and satisfaction (Khan, 2010). Dimensions of organisational performance could therefore be financial and non-financial. Wang, Chich-Jen, and Mei-Ling (2010) citing Choi and Mueller (1992) argue that an enterprise should simultaneously consider financial and non-financial indices for performance evaluation. In other words, qualification and quantification factors should be considered at the same time, because such non-financial indices as employee morale and product quality are very important for its long-term operation.

The absence of good human capital resourcing practices could lead to dysfunctional or negative organisational outcomes and high rates of employees' separation (voluntary and involuntary). Organisations try to avoid the need for involuntary separation and to minimise voluntary separation especially among top performers as both kinds of turnover are costly (Noe, Hollenbeck, Gerhart & Wright, 2004). Haphazard human capital resourcing and separation of valued employees could be insidious to the well-being of organisations the world over. In some organisations, be it unionised or non-unionised, public or private, manufacturing or service-oriented, the human capital resourcing function is conducted in a haphazard and informal fashion. More so, nepotism, favouritism and god-fatherism have been rife in the execution of human capital resourcing function in some organisations. According to Fashoyin (2005), recruitment and selection are heavily influenced by relations rather than by objective assessment of the suitability of the job applicant. Thus, family affiliation and friendship have substantial influence. These may lead to negligent hiring with adverse implications for employees' satisfaction, retention as well as organisational performance. In spite of such challenges, researches on effective human capital resourcing are few. According to Ploy hart (2006), in spite of the critical needs for effective staffing practice, many organisational decision makers overlook the need for staffing research necessary to identify research-practice gaps. Such studies are imperative to abridge the theory-practice gaps in human capital resourcing practices in Nigerian workplaces. An organisation reputable for incessant voluntary labour turnover will find it extremely difficult to attract talents or prospective applicants from the external labour market. Dreher and Dougherty (2002) argue that voluntary turnover is costly because replacements must be recruited, selected and trained. Thus, an excessive voluntary turnover rate can disrupt the social and communication patterns among stayers and increase stayers' workloads and stress levels. The escalation in the rate of labour turnover is a grave concern for organisations. Dess and Shaw (2001) opine that voluntary turnover represents significant direct costs (replacement, recruitment, selection, temporary staff and management time); indirect costs (staff morale, pressure on remaining staff, cost of training, product/ service quality and organisational reputation) and loss of social capital.

According to Peretomode and Peretomode (2001), the efficiency and effectiveness of any work place (whether the private or the public sector) largely depend on the calibre of the workforce. The availability of a competent and effective labour force does not just happen by chance but through an articulated recruitment exercise. Recruitment is the process of announcing job vacancies with a view to attracting a pool of qualified applicants to fill up vacancies in an organisation. It is regarded as a positive process. According to Etomi (2002), recruitment is concerned with the process of attracting a sufficient number of individuals with the right profile in terms of qualifications, experience, skills and other relevant attributes to indicate their interest in working for an organisation. Recruitment is the process of generating a pool of qualified applicants for organisational jobs (Mathias & Jackson, 2004). Selection is the process of evaluating those who have been searched for and obtained through recruitment with a view to deciding whether they can be employed or not. It is also the process of choosing the individual or individuals who best meet the job-related criteria. "Selection is a decision-making activity: the psychological calculation of suitability" (Price, 2004, p.408). According to Yoder and Staudohar (1982, p.169) "selection is the process in which candidates for employment are divided into two classes – those who will be offered employment and those who will not"

The objective of this paper is to examine human capital resourcing practices and organisational performance in selected organisations in the food, beverage and tobacco industry in Lagos State, Nigeria.

#### **2. Literature review**

280 Theoretical and Methodological Approaches to Social Sciences and Knowledge Management

and non-financial metrics to measure organisational performance. Financial measures include profit, sales, and market share. Non-financial measures include output or productivity, quality, efficiency, and the attitudinal and behavioural measures such as commitment, intention to quit, and satisfaction (Khan, 2010). Dimensions of organisational performance could therefore be financial and non-financial. Wang, Chich-Jen, and Mei-Ling (2010) citing Choi and Mueller (1992) argue that an enterprise should simultaneously consider financial and non-financial indices for performance evaluation. In other words, qualification and quantification factors should be considered at the same time, because such non-financial indices as employee morale and product quality are very important for its

The absence of good human capital resourcing practices could lead to dysfunctional or negative organisational outcomes and high rates of employees' separation (voluntary and involuntary). Organisations try to avoid the need for involuntary separation and to minimise voluntary separation especially among top performers as both kinds of turnover are costly (Noe, Hollenbeck, Gerhart & Wright, 2004). Haphazard human capital resourcing and separation of valued employees could be insidious to the well-being of organisations the world over. In some organisations, be it unionised or non-unionised, public or private, manufacturing or service-oriented, the human capital resourcing function is conducted in a haphazard and informal fashion. More so, nepotism, favouritism and god-fatherism have been rife in the execution of human capital resourcing function in some organisations. According to Fashoyin (2005), recruitment and selection are heavily influenced by relations rather than by objective assessment of the suitability of the job applicant. Thus, family affiliation and friendship have substantial influence. These may lead to negligent hiring with adverse implications for employees' satisfaction, retention as well as organisational performance. In spite of such challenges, researches on effective human capital resourcing are few. According to Ploy hart (2006), in spite of the critical needs for effective staffing practice, many organisational decision makers overlook the need for staffing research necessary to identify research-practice gaps. Such studies are imperative to abridge the theory-practice gaps in human capital resourcing practices in Nigerian workplaces. An organisation reputable for incessant voluntary labour turnover will find it extremely difficult to attract talents or prospective applicants from the external labour market. Dreher and Dougherty (2002) argue that voluntary turnover is costly because replacements must be recruited, selected and trained. Thus, an excessive voluntary turnover rate can disrupt the social and communication patterns among stayers and increase stayers' workloads and stress levels. The escalation in the rate of labour turnover is a grave concern for organisations. Dess and Shaw (2001) opine that voluntary turnover represents significant direct costs (replacement, recruitment, selection, temporary staff and management time); indirect costs (staff morale, pressure on remaining staff, cost of training, product/ service quality and organisational

According to Peretomode and Peretomode (2001), the efficiency and effectiveness of any work place (whether the private or the public sector) largely depend on the calibre of the workforce. The availability of a competent and effective labour force does not just happen by chance but through an articulated recruitment exercise. Recruitment is the process of

long-term operation.

reputation) and loss of social capital.

Attempt is made to review some theoretical and conceptual issues, as well as empirical studies germane to human capital resourcing practices. Human capital is the bedrock upon which all other organisational resources rest upon. Bontis, Dragonetti, Jacobsen and Roos (1999) view human capital as representing the human factor in the organisation; the combined intelligence, skills and expertise that gives the organisation its distinctive character. The human elements of the organisation are those that are capable of learning, changing, innovating and providing the creative thrust which if properly motivated can ensure the long-term survival of the organisation. According to Armstrong (1998), the word resourcing describes what managers need to do to ensure that they get the people they want in terms of numbers, skills and capabilities. This entails forecasting requirements, job analysis, recruitment and selection. Price (2004) views employee resourcing (human capital resourcing) as the process by which people are identified and allocated to perform necessary work. Thus, resourcing has two strategic imperatives: first is to minimise employee costs and to maximise employee value to the organisation; and secondly to obtain the correct behavioural mix of attitude and commitment in the workforce. Katou (2008) views human capital resourcing as comprised of recruitment, selection, separation and flexible work arrangements. This study leans on the following theories; the resource-based view or theory, contingency theory, universalistic theory and decision-making theory. Theoretical framework provides the explanations on which a study is based (Oyeniyi, 2006). What follows is an examination of the theoretical underpinnings of the study.

#### **Resource-based view or theory**

Human resource has been regarded as an important factor for an organisation to gain competitive advantages and realise organisational goals or targets as advanced by the resource-based theory (Barney, 2001). This theory holds the view that the strategic

Human Capital Resourcing Practices and Organisational Performance:

needed to achieve organisational performance/effectiveness.

A Study of Selected Organisations in Lagos State, Nigeria 283

established that practising an effective recruitment and selection process has positive relationship with organisational performance. Researchers have found a positive and statistically significant association between use of recruitment and selection procedure and profits (Terpstra & Rozell, 1993). A good recruitment exercise enhances productivity. It also reduces cost as it reduces labour turnover rate and employee dissatisfaction (Nwachukwu, 2000). In a study in Greece, Katou and Bedhwar (2006) found that staffing and other HRM practices such as training and promotion, involvement of employees, incentives, safety and health have positive relationship with firms' performance. Gberevbie (2010), in a study on strategies for employee recruitment, retention and performance in the Nigerian civil service, argued that for an organisation to realise its goals, appropriate strategies for employee recruitment and retention are sine-qua-non for enhanced performance. In a study on recruitment, and quality of academic staff selection, the case of Covenant University, Nigeria; Gberevbie (2006) declared that the success and failure of any organisation to a greater extent depend on the quality of its work-force arising from the level of importance attached to the recruitment of its work-force. Gberevbie (2006) further observed that there is a linkage between labour sourcing decision and organisational performance. The linkage is contingent on the fact that for organisation to achieve its goals, labour sourcing decisions on where to get quality staff and when to hire them become very crucial to the performance and survival of the organisation. In a similar vein, Armstrong (2001) observed that employee resourcing strategy is a vital part of both the formulation and implementation of business strategies

Selection has been found to be positively related to firm performance (Terpstra & Rozell, 1993). Researchers found a positive relationship between effective recruitment and selection practices and top-class performance (Harel & Tzafrir, 1996; Delany & Huselid, 1996). Selective selection is negatively related to employee turnover and is positively related with perceived profit, market share and investments in the near future (Verburg, 1998). Fajana (1995) noted that in the selection process of small and medium enterprises (SMEs) and some large enterprises (LEs), selection was often based on subjective criteria as interviews, psychological tests and medical examinations were ignored or not formally or seriously executed. References were sometimes asked for but not given proper consideration or scrutiny. From empirical research, firm size is very important for the formalisation of HR policies and practices. Hornsby and Kurato (1990) analysed personnel policies and activities on five important aspects namely; job analysis and job description, recruitment and selection, remuneration, training and performance assessment. They found that sophistication of personnel activities were directly linked with firm size. The bigger the company the more sophisticated and extensive were the policies and activities in use. Thus, with increasing size, HR policies and activities become more complex, more formalised and sophisticated. If an organisation hires an applicant without checking his/her references and background and the applicant later commits a crime while in the employ of the organisation, the organisation may be found guilty of negligent hiring (Aamodt, 1999). From experience, reference checks is one of the selection tools usually taken for granted by many organisations. The danger of this attitude towards reference checks could be negligent hiring. Dessler (2008) defined negligent hiring as hiring

capability of an organisation is dependent on its resource capability in the shape of people (Armstrong, 2009). The resource-based theory provides the rationale for human capital resourcing. It maintains that the long-term competitiveness of a company depends upon the resources that not only differentiate it from its competitors, but are also durable and difficult to imitate and substitute. The resource-based view, advocates that an organisation can gain competitive advantage by attracting and retaining best human resources.

#### **Contingency theory**

Contingency theory states that the relationship between the relevant independent variables (e.g HRM policies and practices) and the dependent variable (performance) will vary according to the influences such as company size, age, technology, capital intensity, degree of unionisation, industry/sector, ownership and location (Paauwe, 2004). This theory holds the view that human resource management is influenced by the organisation's environment and circumstances (Legge, 1978; as cited in Armstrong, 2009). This is also true for human capital resourcing practices and organisational performance since they cannot exist in a vacuum but within an operating milieu or environment. Organisational performance is influenced by variables viewed as contingencies (Katou, 2009). This supports the argument of Kuchinke (2003) that organisations do not operate in a vacuum.

#### **Decision-making theory**

The basis of the decision-making theory is the fact that decision- making is at the very heart of business success of any organisation (Gberevbie, 2006). For this study, the decisionmaking theory is adopted because human capital resourcing which promotes the achievement of organisational goals and objectives entails management decision. Thus, the more quality a decision taken by an organisation is, particularly as regards who to hire and from what source, the higher their profitability and productivity (Gberevbie, 2006). Noe, Hollenbeck, Gerhart, and Wright (2004) observed that through personnel selection, organisations make decisions about who will or will not be allowed to join the organisation. This theory assumes that decision-making is the essence of all human resource management actions and processes. It also assumes that decisions are rational and that managers examine the pros and cons of taking a particular decision.

#### **Universalistic theory**

The universalistic theory is associated with terms such as best practices and high performance work practices. It assumes that there is a linear relationship between HR practices or systems and organisational performance and that best practices are universally applicable and successful. It posits that organisational success is best measured in terms of financial performance indicators like profits, or by market share and sales levels. Universalistic theorists are Osterman (1994), Pfeffer (1994) and Huselid (1995).

What follows are empirical studies which have established connections between human capital resourcing practices and organisational performance. Delany and Huselid (1996)

capability of an organisation is dependent on its resource capability in the shape of people (Armstrong, 2009). The resource-based theory provides the rationale for human capital resourcing. It maintains that the long-term competitiveness of a company depends upon the resources that not only differentiate it from its competitors, but are also durable and difficult to imitate and substitute. The resource-based view, advocates that an organisation can gain competitive advantage by attracting and retaining best human

Contingency theory states that the relationship between the relevant independent variables (e.g HRM policies and practices) and the dependent variable (performance) will vary according to the influences such as company size, age, technology, capital intensity, degree of unionisation, industry/sector, ownership and location (Paauwe, 2004). This theory holds the view that human resource management is influenced by the organisation's environment and circumstances (Legge, 1978; as cited in Armstrong, 2009). This is also true for human capital resourcing practices and organisational performance since they cannot exist in a vacuum but within an operating milieu or environment. Organisational performance is influenced by variables viewed as contingencies (Katou, 2009). This supports the argument of Kuchinke (2003) that organisations do not operate in

The basis of the decision-making theory is the fact that decision- making is at the very heart of business success of any organisation (Gberevbie, 2006). For this study, the decisionmaking theory is adopted because human capital resourcing which promotes the achievement of organisational goals and objectives entails management decision. Thus, the more quality a decision taken by an organisation is, particularly as regards who to hire and from what source, the higher their profitability and productivity (Gberevbie, 2006). Noe, Hollenbeck, Gerhart, and Wright (2004) observed that through personnel selection, organisations make decisions about who will or will not be allowed to join the organisation. This theory assumes that decision-making is the essence of all human resource management actions and processes. It also assumes that decisions are rational and that managers examine

The universalistic theory is associated with terms such as best practices and high performance work practices. It assumes that there is a linear relationship between HR practices or systems and organisational performance and that best practices are universally applicable and successful. It posits that organisational success is best measured in terms of financial performance indicators like profits, or by market share and sales levels. Universalistic theorists are Osterman (1994), Pfeffer (1994) and Huselid

What follows are empirical studies which have established connections between human capital resourcing practices and organisational performance. Delany and Huselid (1996)

resources.

a vacuum.

**Contingency theory**

**Decision-making theory**

**Universalistic theory**

(1995).

the pros and cons of taking a particular decision.

established that practising an effective recruitment and selection process has positive relationship with organisational performance. Researchers have found a positive and statistically significant association between use of recruitment and selection procedure and profits (Terpstra & Rozell, 1993). A good recruitment exercise enhances productivity. It also reduces cost as it reduces labour turnover rate and employee dissatisfaction (Nwachukwu, 2000). In a study in Greece, Katou and Bedhwar (2006) found that staffing and other HRM practices such as training and promotion, involvement of employees, incentives, safety and health have positive relationship with firms' performance. Gberevbie (2010), in a study on strategies for employee recruitment, retention and performance in the Nigerian civil service, argued that for an organisation to realise its goals, appropriate strategies for employee recruitment and retention are sine-qua-non for enhanced performance. In a study on recruitment, and quality of academic staff selection, the case of Covenant University, Nigeria; Gberevbie (2006) declared that the success and failure of any organisation to a greater extent depend on the quality of its work-force arising from the level of importance attached to the recruitment of its work-force. Gberevbie (2006) further observed that there is a linkage between labour sourcing decision and organisational performance. The linkage is contingent on the fact that for organisation to achieve its goals, labour sourcing decisions on where to get quality staff and when to hire them become very crucial to the performance and survival of the organisation. In a similar vein, Armstrong (2001) observed that employee resourcing strategy is a vital part of both the formulation and implementation of business strategies needed to achieve organisational performance/effectiveness.

Selection has been found to be positively related to firm performance (Terpstra & Rozell, 1993). Researchers found a positive relationship between effective recruitment and selection practices and top-class performance (Harel & Tzafrir, 1996; Delany & Huselid, 1996). Selective selection is negatively related to employee turnover and is positively related with perceived profit, market share and investments in the near future (Verburg, 1998). Fajana (1995) noted that in the selection process of small and medium enterprises (SMEs) and some large enterprises (LEs), selection was often based on subjective criteria as interviews, psychological tests and medical examinations were ignored or not formally or seriously executed. References were sometimes asked for but not given proper consideration or scrutiny. From empirical research, firm size is very important for the formalisation of HR policies and practices. Hornsby and Kurato (1990) analysed personnel policies and activities on five important aspects namely; job analysis and job description, recruitment and selection, remuneration, training and performance assessment. They found that sophistication of personnel activities were directly linked with firm size. The bigger the company the more sophisticated and extensive were the policies and activities in use. Thus, with increasing size, HR policies and activities become more complex, more formalised and sophisticated. If an organisation hires an applicant without checking his/her references and background and the applicant later commits a crime while in the employ of the organisation, the organisation may be found guilty of negligent hiring (Aamodt, 1999). From experience, reference checks is one of the selection tools usually taken for granted by many organisations. The danger of this attitude towards reference checks could be negligent hiring. Dessler (2008) defined negligent hiring as hiring

Human Capital Resourcing Practices and Organisational Performance:

Organisational performance is positively related to recruitment

Job analysis exercise (systematic investigation in to the nature and requirements of a job) is carried out prior to recruitment of staff in my

Job vacancies are often advertised externally in my organisation to fill

Job vacancies are advertised internally in my organisation to fill

Both internal and external recruitment sources are used in filling job vacancies whenever they

In the recruitment of staff, my organisation adopts realistic and honest recruitment messages.

strategy is practised by my

**<sup>8</sup>**The use of contract staff is

organisational size

of recruitment?

The use of outsourcing recruitment

commonplace in my organisation

E-recruitment or online or internet recruitment is practised by my organisation to attract prospective applicants from external labour

**<sup>10</sup>**Recruitment practices are related to

How often does your organisation deploy the following internal method(s)

**<sup>i</sup>**Promotion 78 (31)

**ii** Transfer 78 (31)

**iii** Job posting 78 (23)

**4. Results**

**1**

**2**

**3**

**4**

**5**

**6**

**7**

**9**

**11**

practices.

organisation.

job openings

job openings

organisation.

market

arise.

A Study of Selected Organisations in Lagos State, Nigeria 285

**S/N STATEMENTS N SA A D SD MIS STD**

78 (35) 44.9%

78 (12) 15.4%

78 (12) 15.4%

78 (20) 25.6%

78 (20) 25.6%

78 (14) 17.9%

78 (18) 23.1%

78 (19) 24.4%

78 (19) 24.4%

78 (21) 26.9%

> **N Always 3**

> > 39.7%

39.7%

29.5%

**4 3 2 1**

(3) 3.8%

> (7) 9%

(24) 30.8%

(13) 16.7%

(15) 19.2%

(5) 6.4%

(22) 28.2%

(26) 33.3%

(23) 29.5%

(13) 16.7%

**Sometimes 2**

> (47) 60.3%

> (44) 56.4%

> (50) 64.1%

(3) 3.8%

(13) 16.7%

(2) 2.6%

(2) 2.6%

(6) 7.7%

(4) 5.1%

(1) 1.3%

(26) 33.3%

**Never 1**

> (3) 3.8%

> (5) 6.4%

2.99 .63

2.51 .95

3.04 .73

3.01 .75

2.96 .75

2.85 .84

2.88 .79

2.28 1.17

**MIS STD**

2.36 .56

2.23 .56

(40) 51.3%

(56) 71.8%

(29) 37.2%

(43) 55.1%

(41) 52.6%

(53) 67.9%

(34) 43.6%

> (32) 41%

(10) 12.8%

(44) 56.4%

workers with questionable backgrounds without proper safeguards. Negligent hiring is injurious to the organisation, customers and co-workers. Aamodt (1999) suggested that employers via the HRM department should obtain information about the quality of previous performance by relying on an applicant's references from previous employers. Ahmed and Schroeder (2003) investigated the effect of selective hiring on organisational performance (quality, cost, flexibility, delivery and commitment). The study confirmed a positive and significant relationship with firms' operational performance. Delaney and Huselid (1996) reported that selectivity in staffing is positively related to firm performance. Employees could be hired via sophisticated selection procedures designed to screen out all but the very best potential employees that would impact on the bottom line.

#### **2.1 Research hypotheses**

Two research hypotheses were formulated for the purpose of this study and both tested at 5% level of significance. The authors hypothesised:

#### **3. Methods**

The study adopted the descriptive or survey research design. There are other research designs such as observational and experimental designs. The justification for choosing the survey method is based on the fact that the study is interested in gaining an understanding of the problem being investigated without any attempt to manipulate or control the sample subjects (Asika, 1991). More so, the focus of the study is to examine the attitude or opinion of respondents as opposed to their behaviour. The survey method is ideal since large sample of respondents are required and the researchers are interested in subjecting the collected data to rigorous statistical analysis and hypotheses testing. Primary, secondary and tertiary sources of data were utilised. With a view to eliciting information from respondents, a self-developed questionnaire was designed using the 4 point Likert scale ranging from strongly agree (4) to strongly disagree (1). Also, the 3 point scale ranging from always (3) to never (1) was deployed. An in-depth interview was carried out to corroborate some of the responses to the items in the instrument. The instrument has 24 items. Section A sought the views of respondents on adopted human capital resourcing practices. This section has nineteen (19) items. Section B x-rayed the demographic profile of respondents with five (5) items. Cronbach's Alpha or Coefficient Alpha is .89 or 89%. This implies that the instrument is reliable. A total of 105 samples were drawn from the target population using the simple random sampling technique. However 78 questionnaires were returned upon which the data analysis was based. This represents 74% response rate. Data analysis was carried out with the aid of SPSS (Statistical Package for Social Sciences) version 17. Correlation statistical technique was used to test the hypotheses at 5% level of significance.

#### **4. Results**

284 Theoretical and Methodological Approaches to Social Sciences and Knowledge Management

workers with questionable backgrounds without proper safeguards. Negligent hiring is injurious to the organisation, customers and co-workers. Aamodt (1999) suggested that employers via the HRM department should obtain information about the quality of previous performance by relying on an applicant's references from previous employers. Ahmed and Schroeder (2003) investigated the effect of selective hiring on organisational performance (quality, cost, flexibility, delivery and commitment). The study confirmed a positive and significant relationship with firms' operational performance. Delaney and Huselid (1996) reported that selectivity in staffing is positively related to firm performance. Employees could be hired via sophisticated selection procedures designed to screen out all but the very best potential employees that would impact on the bottom

Two research hypotheses were formulated for the purpose of this study and both tested at

i. That there is a positive relationship between recruitment practices and organisational

ii. That there is a positive relationship between selection practices and organisational

The study adopted the descriptive or survey research design. There are other research designs such as observational and experimental designs. The justification for choosing the survey method is based on the fact that the study is interested in gaining an understanding of the problem being investigated without any attempt to manipulate or control the sample subjects (Asika, 1991). More so, the focus of the study is to examine the attitude or opinion of respondents as opposed to their behaviour. The survey method is ideal since large sample of respondents are required and the researchers are interested in subjecting the collected data to rigorous statistical analysis and hypotheses testing. Primary, secondary and tertiary sources of data were utilised. With a view to eliciting information from respondents, a self-developed questionnaire was designed using the 4 point Likert scale ranging from strongly agree (4) to strongly disagree (1). Also, the 3 point scale ranging from always (3) to never (1) was deployed. An in-depth interview was carried out to corroborate some of the responses to the items in the instrument. The instrument has 24 items. Section A sought the views of respondents on adopted human capital resourcing practices. This section has nineteen (19) items. Section B x-rayed the demographic profile of respondents with five (5) items. Cronbach's Alpha or Coefficient Alpha is .89 or 89%. This implies that the instrument is reliable. A total of 105 samples were drawn from the target population using the simple random sampling technique. However 78 questionnaires were returned upon which the data analysis was based. This represents 74% response rate. Data analysis was carried out with the aid of SPSS (Statistical Package for Social Sciences) version 17. Correlation statistical technique was

line.

**2.1 Research hypotheses**

performance.

performance.

**3. Methods**

5% level of significance. The authors hypothesised:

used to test the hypotheses at 5% level of significance.

Human Capital Resourcing Practices and Organisational Performance:

There is positive relationship between selection practices and organisational performance

**<sup>15</sup>**Selection practices are related to

organisation is related to adopted

Employees' tenure in an

recruitment and selection

**<sup>17</sup>**Orientation/induction of new staff is done by my organisation

> Staff are properly placed after selection in jobs for which they are economically most useful

**How often does your organisation use the following selection method (s) in making hiring decisions?**

Assessment centre (case analysis, in-basket, leaderless group discussions)

analysis)

**<sup>v</sup>**Graphology(hand writing

**vi** Polygraph( honesty or integrity test)

**ix** Investigation from previous employers

Table 1. Descriptive Statistics of Primary Data

**Source:** Field Survey, 2011.

**<sup>i</sup>**Interview 78 (69)

**ii** Employment test 78 (56)

**iv** Work sample(practical test) 78 (19)

**vii** Medical examination 78 (50)

**viii** Reference report 78 (33)

MIS= mean Item Score: STD= standard deviation/ variation ratio

organisational size

practices

**14**

**16**

**18**

**19**

**iii**

A Study of Selected Organisations in Lagos State, Nigeria 287

 **N SA A D SD MIS STD**

78 (28) 35.9%

78 (12) 15.4%

78 (5) 6.4%

78 (34) 43.6%

78 (20) 25.6%

> **N Always 3**

> > 88.5%

71.8%

24.4%

64.1%

42.3%

78 (20) 25.6%

78 (10) 12.8%

78 (15) 19.2%

78 (27) 34.6%

**Legend:** N= Respondents: SA= strongly agree: A= Agree: D= disagree: SD= strongly disagree:

**4 3 2 1**

(1) 1.3%

(15) 19.2%

(35) 44.9%

(3) 3.8%

(8) 10.3%

**Sometimes 2**

> (9) 11.5%

> (21) 26.9%

> (38) 48.7%

> (44) 56.4%

> (29) 37.2%

> (25) 32.1%

> (20) 25.6%

> (36) 46.2%

> (40) 51.3%

(3) 3.8%

(1) 1.3%

**Never 1**

> (1) 1.3%

(20) 25.6%

(15) 19.2%

> (39) 50%

(38) 48.7%

(8) 10.3%

(9) 11.5%

(11) 14.1%

2.54 .68

3.37 .63

**MIS STD**

2.71 .49

2.00 .72

2.05 .66

1.63 .71

1.71 .78

2.54 .68

2.31 .67

2.21 .67

(49) 62.8%

(51) 65.4%

(35) 44.9%

(40) 51.3%

(50) 64.1%

**S/N STATEMENTS N SA A D SD MIS**

15.4%

47.4%

9%

19.2%

2.6%

10.3%

11.5%

6.4%

7.7%

5.1%

3.8%

24.4%

16.7%

3.8%

16.7%

9%

**N Always 3**

**N Always 3**

**iv** Employee referral 78 (12)

**<sup>i</sup>**Advertisement 78 (37)

**ii** Executive search agency(head hunters) 78 (7)

**iii** Employee referral 78 (15)

**iv** Through Unions 78 (2)

**<sup>v</sup>**Educational Institutions(scouting) 78 (8)

**vi** Private employment agency 78 (9)

**vii** Public employment agency 78 (5)

**viii** Professional bodies 78 (6)

**ix** Unsolicited applications 78 (4)

**How often does your organisation use the following recruitment metrics to determine the effectiveness and efficiency of recruitment**

**sources/methods in your organisation?**

**<sup>i</sup>**Yield ratio 78 (19)

**ii** Cost per hire 78 (13)

**iii** Survey 78 (3)

**iv** Data on turnover 78 (13)

**<sup>v</sup>**Leads or applicant generated 78 (7)

Walk-in 78 (3)

**x**

**13**

**<sup>12</sup>How often does your organisation deploy the following external method(s) of recruitment?**

**4 3 2 1**

(11) 14.1%

**Never 1**

(21) 26.9%

(10) 12.8%

(51) 65.4%

> (39) 50%

(23) 29.5%

(48) 61.5%

(37) 47.4%

(21) 26.9%

(16) 20.5%

**Never 1**

(20) 25.6%

(26) 33.7%

(47) 60.3%

(20) 25.6%

(40) 51.3% 2.01 .55

**MIS STD**

1.82 .58

2.06 .57

1.37 .54

1.60 .67

1.82 .62

1.45 .62

1.60 .63

1.78 .53

1.83 .47

**MIS STD**

1.99 .71

1.83 .69

1.44 .57

1.91 .65

1.58 .66

(55) 70.5%

**Sometimes 2**

> (41) 52.4%

> (50) 64.1%

> (53) 67.9%

> (25) 32.1%

> (31) 39.7%

> > (46) 59%

(25) 32.1%

(35) 44.9%

(53) 67.9%

(59) 75.6%

**Sometimes 2**

> (39) 50%

> (39) 50%

(28) 35.9%

(45) 57.7%

(31) 39.7%

**Source:** Field Survey, 2011.

**Legend:** N= Respondents: SA= strongly agree: A= Agree: D= disagree: SD= strongly disagree: MIS= mean Item Score: STD= standard deviation/ variation ratio

Table 1. Descriptive Statistics of Primary Data

Human Capital Resourcing Practices and Organisational Performance:

merely indicates that the variables covary.

**5. Discussion of findings**

performance.

advantage.

**7. References**

Publishing Company.

U.K: Kogan Page Ltd.

Kogan Page Ltd.

**6. Conclusion**

A Study of Selected Organisations in Lagos State, Nigeria 289

In testing the first hypothesis that there is a positive relationship between recruitment practices and organisational performance, it was found that there is a positive relationship between recruitment practices and organisational performance (r =0.45; p< .05).This result is statistically significant. In testing the second hypothesis that there is a positive relationship between selection practices and organisational performance, it was found that there is a positive relationship between selection practices and organisational performance (r= 0.49; p< .05).This is also statistically significant. This means that as recruitment and selection practices are properly executed or improve, so does organisational performance. It should be noted that this interpretation in no way implies causality. The significant relationship

From the test of hypotheses, it was found that there is a positive relationship between recruitment practices and organisational performance (r=0.45; p<.05). It was also found that there is a positive relationship between selection practices and organisational performance (r=0.49; p<.05). These results are statistically significant. These findings are consistent with the findings of Delany and Huselid (1996) who found that practising an effective recruitment and selection process has positive relationship with organisational performance. The findings also corroborate the views of Terpstra and Rozell (1993) who found an association between use of recruitment and selection procedure and profits. The findings are also consistent with those of Ahmed and Schroeder (2003) who investigated the effect of selective hiring on organisational performance (quality, cost, flexibility, delivery and commitment) and found a positive and significant relationship with firms' operational

This study set out to investigate human capital resourcing practices and organisational performance. From the findings of this study, it could be concluded that there is an association between human capital resourcing practices and organisational performance. From the findings of this study, the authors hereby recommend that organisations should pay adequate attention to recruitment and selection practices to gain competitive

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Differences". *Journal of Operations Management.* 21, pp. 19–43.

Practices on Operational Performance: Recognising Country and Industry

**Source:** Field Survey, 2011.

Table 2. Demographic Profile of Respondents

In testing the first hypothesis that there is a positive relationship between recruitment practices and organisational performance, it was found that there is a positive relationship between recruitment practices and organisational performance (r =0.45; p< .05).This result is statistically significant. In testing the second hypothesis that there is a positive relationship between selection practices and organisational performance, it was found that there is a positive relationship between selection practices and organisational performance (r= 0.49; p< .05).This is also statistically significant. This means that as recruitment and selection practices are properly executed or improve, so does organisational performance. It should be noted that this interpretation in no way implies causality. The significant relationship merely indicates that the variables covary.

#### **5. Discussion of findings**

288 Theoretical and Methodological Approaches to Social Sciences and Knowledge Management

Male 69 88.5% Female 9 11.5%

Less than 20years ----- ---

20-29 4 5.1%

30-39 48 61.5%

40-49 25 32.1% 50 and above 1 1.3%

Married 49 62.8%

Single 29 37.2%

Separated --- ---

Divorced --- ----

OND 1 1.3% HND 30 38.5%

First degree 27 34.6%

Masters 20 25.6%

Ph.D ---- ----

Junior ----- ----

Senior 62 79.5% Management Staff 16 20.5%

**Frequency**

**Relative Frequency**

**S/N Variables Absolute**

Sex of Respondents

Age of Respondents

Marital Status

Qualifications

**5.** Job Category

**Source:** Field Survey, 2011.

Table 2. Demographic Profile of Respondents

**1.**

**2.**

**3.**

**4.**

From the test of hypotheses, it was found that there is a positive relationship between recruitment practices and organisational performance (r=0.45; p<.05). It was also found that there is a positive relationship between selection practices and organisational performance (r=0.49; p<.05). These results are statistically significant. These findings are consistent with the findings of Delany and Huselid (1996) who found that practising an effective recruitment and selection process has positive relationship with organisational performance. The findings also corroborate the views of Terpstra and Rozell (1993) who found an association between use of recruitment and selection procedure and profits. The findings are also consistent with those of Ahmed and Schroeder (2003) who investigated the effect of selective hiring on organisational performance (quality, cost, flexibility, delivery and commitment) and found a positive and significant relationship with firms' operational performance.

#### **6. Conclusion**

This study set out to investigate human capital resourcing practices and organisational performance. From the findings of this study, it could be concluded that there is an association between human capital resourcing practices and organisational performance. From the findings of this study, the authors hereby recommend that organisations should pay adequate attention to recruitment and selection practices to gain competitive advantage.

#### **7. References**

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**Section 7**

**Lean Behaviour and Sustainability**

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## **Section 7**

**Lean Behaviour and Sustainability**

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Performance as viewed from Human Resource Management Strategy". *African*

**15**

*Malaysia*

A. Perumal Puvanasvaran

*Technical University of Malaysia Malacca*

**Enhancing Productivity Through Lean Behavior**

Productivity is a measure of output from a production process. It reflects the efficiency of production. A change in technology today, however, might increase production output with a given quantity of inputs, such an increase in productivity would be more technically efficient, but might not reflect any change in allocative efficiency. Lean initiatives that focuses on tools and techniques, often stumble as excitement from initial achievements diminishes and the lean way becomes more difficult. Behavioral change is the key to making lean initiatives sustainable and successful. Lean behavior on the other hand, improves the problem solving capabilities of people in the development system while eliminating

Furthermore, lean is one of the popular concepts that have been implemented in many companies. According to Bhasin and Burcher (2006), very few companies succeed in implementing lean manufacturing practices. The number of lean tools, techniques and technologies available to improve operational performance is growing rapidly, however a few companies that put effort to use them failed to produce significant results. One of the major reasons for unsuccessful implementation of lean manufacturing is the typical behaviors exhibited by people at the workplace, which are known to be deficient in trust and gain commitment too. Orr (2005) stated that the term "lean" manufacturing seems to have forgotten the debate on human motivation, and has focused on techniques, where the emphasis has been on deploying new methods, rather than understanding how work is organized and lead. The practice of lean behavior is shown to be an essential element for producing healthy work environments that can lead to economic improvement. At the same time, lean produces as stated by Emiliani (1998). Emiliani and Stec (2004) that lean behavior practices must apply all the lean principles where most companies failed to apply all the lean principles together in order to get significant result. It is essential that the right behavior among organization employees is maintained, so that the full benefits of lean can be enjoyed as stated by Sanjay and Peter (2006). Implementation lean is a long journey process and not easily implemented. To fully benefit the company for lean implementation, both the concept and techniques should be considered. Lean behaviors typically are essential factor and should be assessed for a successful and complete implementation.

Thus, it is important to enhance productivity through lean behavior and inspect lean result after implementation of lean. This study will presents the results of the comparison being made between lean behaviors after implementing lean for one year through lean behavior of

wastages, reducing cost, increasing efficiency and enhancing productivity.

**1. Introduction**

### **Enhancing Productivity Through Lean Behavior**

#### A. Perumal Puvanasvaran

*Technical University of Malaysia Malacca Malaysia*

#### **1. Introduction**

Productivity is a measure of output from a production process. It reflects the efficiency of production. A change in technology today, however, might increase production output with a given quantity of inputs, such an increase in productivity would be more technically efficient, but might not reflect any change in allocative efficiency. Lean initiatives that focuses on tools and techniques, often stumble as excitement from initial achievements diminishes and the lean way becomes more difficult. Behavioral change is the key to making lean initiatives sustainable and successful. Lean behavior on the other hand, improves the problem solving capabilities of people in the development system while eliminating wastages, reducing cost, increasing efficiency and enhancing productivity.

Furthermore, lean is one of the popular concepts that have been implemented in many companies. According to Bhasin and Burcher (2006), very few companies succeed in implementing lean manufacturing practices. The number of lean tools, techniques and technologies available to improve operational performance is growing rapidly, however a few companies that put effort to use them failed to produce significant results. One of the major reasons for unsuccessful implementation of lean manufacturing is the typical behaviors exhibited by people at the workplace, which are known to be deficient in trust and gain commitment too. Orr (2005) stated that the term "lean" manufacturing seems to have forgotten the debate on human motivation, and has focused on techniques, where the emphasis has been on deploying new methods, rather than understanding how work is organized and lead. The practice of lean behavior is shown to be an essential element for producing healthy work environments that can lead to economic improvement. At the same time, lean produces as stated by Emiliani (1998). Emiliani and Stec (2004) that lean behavior practices must apply all the lean principles where most companies failed to apply all the lean principles together in order to get significant result. It is essential that the right behavior among organization employees is maintained, so that the full benefits of lean can be enjoyed as stated by Sanjay and Peter (2006). Implementation lean is a long journey process and not easily implemented. To fully benefit the company for lean implementation, both the concept and techniques should be considered. Lean behaviors typically are essential factor and should be assessed for a successful and complete implementation.

Thus, it is important to enhance productivity through lean behavior and inspect lean result after implementation of lean. This study will presents the results of the comparison being made between lean behaviors after implementing lean for one year through lean behavior of

Enhancing Productivity Through Lean Behavior 297

A survey was conducted by interviewing the top management, middle management and the shop floor. The top management barrier to implement the tool related to issues of communication and power. There were concerns that middle managers and supervisors may feel threatened by the perceived loss of control as shop floor staffs gain more power to use initiatives and make certain changes without consultation with line managers. Even they felt that there were difficulties when it came to making decisions regarding throwing away certain pieces of equipment and machinery that are very old, do not work and take up valuable space. Middle management representatives commented that the 5Ss started off well but dwindled in certain areas. It was because they lost interest and it fell down on custom and practice/self-discipline. They also felt that they should have more power to make decisions relating to their positions. Shop floor felt that some employees had attitude problems, and put minimum effort into their jobs and were not bothered to use or implement the 5Ss, while others were actively involved. Besides, they also commented that their initiative was sometimes held back by their line managers. It was felt that certain line managers were fearful of their subordinates shining and potentially threatening their position. As a result, they did minimum and took no interest in the initiatives of 5S that were likely to be protected by their line managers. From the survey, it was clear to show that the management behavior is the important barrier to implement the lean tool. In **Table 1**,

lean behaviors practices of impact lean manufacturing are highlighted.

Table 1. Component and Lean Behaviors Practice Of Impact Lean Manufacturing

lean behavior are proposed in this chapter for enhancing productivity.

It is a present-day instance of the recurring theme in human history toward increasing efficiency, decreasing waste, reducing cost and using empirical methods to decide what matters, rather than uncritically accepting pre-existing ideas. In order to enhance productivity, we therefore acquire a broader set of skills, creative and innovative approaches to analysis, using up-to-date tools and design through the implementation of lean production methodology and management. As an example, manufacturers must be able to use various of methodologies, ideas and many others of present-day high technology tools to be able to enhance problem productivity and do lean production effectively. Meanwhile, both manufacturers and consumers that comprise the different status levels in the community will have easy and convenience access to the real-time oriented systems for problem solving capabilities and productivity enhancement. For this to occur, tips to build

**3. Tips to build lean behavior**

the people in the development system. The importance of the problem solving capabilities of people in implementing lean process management will be also discussed. The survey was to conduct in an aerospace composite manufacturer in their kitting department. Selfadministered questionnaire has been selected to be the survey instrument in enhancing productivity. These questionnaires were distributed to 45 employees working in the kitting department. Results of the findings and feedback are collected and analyzed by using the Statistical Package for Social Science (SPSS) software. The outputs of the analysis were in the form of index values, percentages and hypothesis testing. The result shows the improvement on lean behavior with the help of people development system implementation which enhance the people capabilities in eliminating wastages, reducing cost and increasing productivity. These are supported by comparing the results of surveys on lean behavior for the beginning and end of the year with the monitoring of real life data on the case study.

#### **2. Lean behavior**

Lean behavior is defined as behaviors that add or create value to waste. It is the minimization of waste associated with arbitrary or contradictory thought and actions that leads to defensive behavior, ineffective relationship, poor co-operation, and negative attitudes stated by M.L. Emiliani (1998). According to case study on Motorola, behavior is important to change culture to sustain implementing of lean concept. Many efforts failed due to the behavior of the management. Employees will follow the management's behavior if they are ordered to do new things. Anonymous, Worley and Doolen (2006) investigated two specific variables impact on lean implementation which is management support and communication. For management support, top management should not only demonstrate commitment and leadership, it must also work to create interest in the implementation and communicate the change to everyone within the organization. Comm (2005) states, that five best practiced components must present in order to apply lean. The five best practiced components are environment change, leadership, culture, employee empowerment, and communication. The management is required to have these lean behaviors which will influence the employees to practice the five components. Meanwhile, Orr (2005) stated that leadership is the fundamental aspect in engaging this different approach in thinking. Leaders are not necessarily top and senior management. Leaders are employees with influence on the work, at whatever level of seniority and responsibility. A leadership must have nine lean behaviors. The nine lean behaviors are teaches and engages workgroups, Respect For people, Process Focus, Support and recognition, Lead by example, Deploy policy and objectives, Commitment to standards, Understand lean vision and principles and Support the change process. Meanwhile, there are other findings on factors that act as barrier for implementing lean concept. Emiliani (1998) stated four primary causes that management lack influence over employees; the four components are the barrier for the commitment of whole employees to implement lean concept. The four components are Trust, Communication, Processes and Environment. Even a case study was conducted by O'hEocha (2000) on Cooke Brother Ltd manufacturing company about the influence of employee's attitudes on the use of 5S which is one of the lean tools for improvement environment management. After the company applies the lean tool in their company, employees were asked to identify the potential issues that may act as barriers to effective implementation.

the people in the development system. The importance of the problem solving capabilities of people in implementing lean process management will be also discussed. The survey was to conduct in an aerospace composite manufacturer in their kitting department. Selfadministered questionnaire has been selected to be the survey instrument in enhancing productivity. These questionnaires were distributed to 45 employees working in the kitting department. Results of the findings and feedback are collected and analyzed by using the Statistical Package for Social Science (SPSS) software. The outputs of the analysis were in the form of index values, percentages and hypothesis testing. The result shows the improvement on lean behavior with the help of people development system implementation which enhance the people capabilities in eliminating wastages, reducing cost and increasing productivity. These are supported by comparing the results of surveys on lean behavior for the beginning and end of the year with the monitoring of real life data on the case study.

Lean behavior is defined as behaviors that add or create value to waste. It is the minimization of waste associated with arbitrary or contradictory thought and actions that leads to defensive behavior, ineffective relationship, poor co-operation, and negative attitudes stated by M.L. Emiliani (1998). According to case study on Motorola, behavior is important to change culture to sustain implementing of lean concept. Many efforts failed due to the behavior of the management. Employees will follow the management's behavior if they are ordered to do new things. Anonymous, Worley and Doolen (2006) investigated two specific variables impact on lean implementation which is management support and communication. For management support, top management should not only demonstrate commitment and leadership, it must also work to create interest in the implementation and communicate the change to everyone within the organization. Comm (2005) states, that five best practiced components must present in order to apply lean. The five best practiced components are environment change, leadership, culture, employee empowerment, and communication. The management is required to have these lean behaviors which will influence the employees to practice the five components. Meanwhile, Orr (2005) stated that leadership is the fundamental aspect in engaging this different approach in thinking. Leaders are not necessarily top and senior management. Leaders are employees with influence on the work, at whatever level of seniority and responsibility. A leadership must have nine lean behaviors. The nine lean behaviors are teaches and engages workgroups, Respect For people, Process Focus, Support and recognition, Lead by example, Deploy policy and objectives, Commitment to standards, Understand lean vision and principles and Support the change process. Meanwhile, there are other findings on factors that act as barrier for implementing lean concept. Emiliani (1998) stated four primary causes that management lack influence over employees; the four components are the barrier for the commitment of whole employees to implement lean concept. The four components are Trust, Communication, Processes and Environment. Even a case study was conducted by O'hEocha (2000) on Cooke Brother Ltd manufacturing company about the influence of employee's attitudes on the use of 5S which is one of the lean tools for improvement environment management. After the company applies the lean tool in their company, employees were asked to identify the potential issues that may act as barriers to effective

**2. Lean behavior**

implementation.

A survey was conducted by interviewing the top management, middle management and the shop floor. The top management barrier to implement the tool related to issues of communication and power. There were concerns that middle managers and supervisors may feel threatened by the perceived loss of control as shop floor staffs gain more power to use initiatives and make certain changes without consultation with line managers. Even they felt that there were difficulties when it came to making decisions regarding throwing away certain pieces of equipment and machinery that are very old, do not work and take up valuable space. Middle management representatives commented that the 5Ss started off well but dwindled in certain areas. It was because they lost interest and it fell down on custom and practice/self-discipline. They also felt that they should have more power to make decisions relating to their positions. Shop floor felt that some employees had attitude problems, and put minimum effort into their jobs and were not bothered to use or implement the 5Ss, while others were actively involved. Besides, they also commented that their initiative was sometimes held back by their line managers. It was felt that certain line managers were fearful of their subordinates shining and potentially threatening their position. As a result, they did minimum and took no interest in the initiatives of 5S that were likely to be protected by their line managers. From the survey, it was clear to show that the management behavior is the important barrier to implement the lean tool. In **Table 1**, lean behaviors practices of impact lean manufacturing are highlighted.

Table 1. Component and Lean Behaviors Practice Of Impact Lean Manufacturing

#### **3. Tips to build lean behavior**

It is a present-day instance of the recurring theme in human history toward increasing efficiency, decreasing waste, reducing cost and using empirical methods to decide what matters, rather than uncritically accepting pre-existing ideas. In order to enhance productivity, we therefore acquire a broader set of skills, creative and innovative approaches to analysis, using up-to-date tools and design through the implementation of lean production methodology and management. As an example, manufacturers must be able to use various of methodologies, ideas and many others of present-day high technology tools to be able to enhance problem productivity and do lean production effectively. Meanwhile, both manufacturers and consumers that comprise the different status levels in the community will have easy and convenience access to the real-time oriented systems for problem solving capabilities and productivity enhancement. For this to occur, tips to build lean behavior are proposed in this chapter for enhancing productivity.

Enhancing Productivity Through Lean Behavior 299

compares common fat behaviors that result in waste and selected lean behaviors that promote flow between people as stated by Cleary (1989) and (1996). It is important to realize that interpersonal skills and organizational effectiveness are developed by practicing and improving upon weaknesses (i.e. lean behaviors), not strengths (i.e. fat behaviors) as

Table 1.a Comparison Of Behavior Attributes by Cleary (1989) and (1996).

organization, the productivity will definitely be enhanced by lean behavior.

The answer is probably yes, when we consider the practice of lean behaviors as shown to be an essential element for producing healthy work environments that can lead to productivity growth, as well as help production sustain efforts to become lean producer. The principal focus is on how individuals can consistently behave in ways that create value (lean behavior), with the goal of eliminating waste in interpersonal relationships and development of people that possess basic capabilities for problem solving in their thoughts and actions. If the performance of lean behaviors can be practiced by individuals and then integrated into the

Liker (2004) stated about how organization should implement the lean process management, there is no exact definition for a fully lean organization. Even though the goal of becoming a

**5. Do lean behaviors correlate with productivity?**

mentioned by M.L. Emiliani (1998).

The organizational vertical integration has parallels input values with other lean disciplines such as lean behaviors are therefore important. Positive organizational behavior which is linked to human resource strengths and psychological capabilities for performance improvement and productivity enhancement in today's workplace. Worker inappropriate behaviors are difficult to change because they are functional: they serve a purpose as an employee. The practice of lean behaviors is shown to be an essential element for producing healthy work environments that can lead to economic growth, as well as help businesses sustain efforts to become lean producers. The principal focus is on how individuals can consistently behave in ways that create value, with the goal of eliminating waste in both intra and interpersonal relationships M.L. Emiliani (1998).

Several tips that leaders can use to improve their team lean behavior. Such as:

1. Defining lean behavior

Most people like to see the correct or the right way of handling work but the correct or right way is not always clear. They might think of doing a right way without looking into lean principals. Lean wants problems and abnormal conditions to be exposed and no wastage nor costliness. Leaders have to make sure that doing the right way doesn't have a high cost to team members.

#### **4. Comparison of behavior attributes**

The organizational vertical integration reflects the level of business community that exhibits the most consistent generative behaviors, as well as helpful tendencies, will be the partner of choice for employees, suppliers, customers, and investors. Lean behaviors exhibited by the organization culture should be a strong source of competitive advantage. **Table 1a** below

The organizational vertical integration has parallels input values with other lean disciplines such as lean behaviors are therefore important. Positive organizational behavior which is linked to human resource strengths and psychological capabilities for performance improvement and productivity enhancement in today's workplace. Worker inappropriate behaviors are difficult to change because they are functional: they serve a purpose as an employee. The practice of lean behaviors is shown to be an essential element for producing healthy work environments that can lead to economic growth, as well as help businesses sustain efforts to become lean producers. The principal focus is on how individuals can consistently behave in ways that create value, with the goal of eliminating waste in both

Most people like to see the correct or the right way of handling work but the correct or right way is not always clear. They might think of doing a right way without looking into lean principals. Lean wants problems and abnormal conditions to be exposed and no wastage nor costliness. Leaders have to make sure that doing the right way doesn't

When the demand for goods is decreasing, workers stop to do overtime. The leader needs to thank to workers for their action. If the workers continue doing their overtime, they are doing it for the wrong reason and that is to increase the overhead cost of the company. Some people like to bypass a process to make things happen quickly. Leader should stop rewarding them of heroism. This might be sending a wrong message.

Leaders must make the workplace look like 5S environment that support lean behavior. Workers will do and follow what the leader normally says. If the workers keep collecting data without analyzing it or no change is being made. Do you think this system support lean behavior? Definitely not! This will lead to wasting of time and

When people see others exhibiting good behavior, they are more likely to continue or follow it. Leaders need to set up a good example of team that can perform good lean

If a member doesn't meet productivity and quality standards after repeated attempts to work with in order to improve, then get a new member. If a customer has expectations that are unreasonable and unprofitable to company, find more customers and nothing to say that you need to deal with them. If an employee chooses not to show lean

The organizational vertical integration reflects the level of business community that exhibits the most consistent generative behaviors, as well as helpful tendencies, will be the partner of choice for employees, suppliers, customers, and investors. Lean behaviors exhibited by the organization culture should be a strong source of competitive advantage. **Table 1a** below

behaviors so that others will follow the right steps and procedures.

behavior, they may not be a good match for the team.

intra and interpersonal relationships M.L. Emiliani (1998).

1. Defining lean behavior

expenses.

have a high cost to team members. 2. Rewarding who has lean behavior

3. Making system support lean behavior

4. Building up a right lean behavior team

5. Eliminating problem members in the team

**4. Comparison of behavior attributes**

Several tips that leaders can use to improve their team lean behavior. Such as:

compares common fat behaviors that result in waste and selected lean behaviors that promote flow between people as stated by Cleary (1989) and (1996). It is important to realize that interpersonal skills and organizational effectiveness are developed by practicing and improving upon weaknesses (i.e. lean behaviors), not strengths (i.e. fat behaviors) as mentioned by M.L. Emiliani (1998).

Table 1.a Comparison Of Behavior Attributes by Cleary (1989) and (1996).

#### **5. Do lean behaviors correlate with productivity?**

The answer is probably yes, when we consider the practice of lean behaviors as shown to be an essential element for producing healthy work environments that can lead to productivity growth, as well as help production sustain efforts to become lean producer. The principal focus is on how individuals can consistently behave in ways that create value (lean behavior), with the goal of eliminating waste in interpersonal relationships and development of people that possess basic capabilities for problem solving in their thoughts and actions. If the performance of lean behaviors can be practiced by individuals and then integrated into the organization, the productivity will definitely be enhanced by lean behavior.

Liker (2004) stated about how organization should implement the lean process management, there is no exact definition for a fully lean organization. Even though the goal of becoming a

Enhancing Productivity Through Lean Behavior 301

region and a known industry player in the world. Though ABC having start to implement Lean Manufacturing System since 2004, but there are some mistakes and frailness due to the lack of implementation which is observed as in production system, where the knowledge and understanding of lean manufacturing system as common and primary root cause problem. The whole of problems occurred throughout from the top level to the bottom. Due to this, the top management commitment, teamwork, and people capabilities in eliminating wastages are also lacking. Furthermore, the problems occurred because the lean implementation was not linking to the individual, department, and company's key performance indicator which was unmotivated the total employees of the company to practice the real of lean concepts. Therefore, based on this reality the lean behavior among the employees never rooted. Effectively in the end of 2006, the company overcomes the past problems with new perspective of lean implementation by developing the integration and heuristic approach of lean concepts as a new strategy that involve all aspects of the company in their operation that correlated to the KPI. The scope of study for this project is conducted

In today's competitive world, no company can afford to waste resources. The most underutilized resource of most manufacturing company is their people assets. The number one asset of any organization is also its people. In fact, people are one of the few appreciating asset an organization has. The real advantages of employee's involvement are to focus a group of employees with different perspective on a single objective that support the organization's strategic focus. The companies that develop and leverage the capabilities of all their employees will achieve better performance than those that do not. The companies that fail to unlock the potential of their workforce will be forced to carry more overhead, have more layers of management, will be slower to react to market change and opportunities. Therefore, since we implement lean as a system in which the people functions need to be developed into a system which called "People Management Systems" to provide the capability for rapid improvement and adoption to change. Each of the three systems in framework has its own objective. The objective of the lean process management system is to identify and eliminate wastages by removing non value added activities. People management systems need to provide the capability for rapid improvement and adoption to change. Here, again, we must accept the fact that change is inevitable and that the speed with which the necessary modification are made is the deciding factor in our survival. The objective of the business management system is to apply carefully the organization's limited resources, including capital and hard assets as well as time and human assets. Three integration elements with total employee involvement from top to bottom play an important role for sustaining problem solving among employees in practicing lean concept. It is important to create people development system which consists of all these three elements with total involvement of people to increase problem solving capability. People management system, Business management system and lean process management system are integrated by principles that, in a sense, hold them together. These principles are meant to provide a framework (**Figure 2**) to focus the direction in enhancing productivity and problem solving capability among employees by forming as people development system in

only at kitting department.

lean process management. They are:

**7. Developing a new system to productivity enhancing**

fully lean organization can only be reached if the employees are well aligned with new philosophy. In that case, it is important for an organization to understand and apply all lean behavior practices and principles, in addition to a comprehensive lean thinking which affects the whole business model as a key and not solely learner production. **Figure 1** shows the key participants in a business, each having a relationship governed by processes and behaviors governing generative relationships. Each of these relationships should be carefully managed in order to minimize waste and maximize the benefits to productivity enhancing.

Fig. 1. Enhancing Productivity Through Lean Behaviors In A Business

#### **6. Background of case study**

The Company where the case study was conducted was incorporated on 16th August 1994. Currently, numbers of employees are 1155 person. The nature of business for this company is to manufacture composites components for aero and non aero structures. The name of this company is changed to ABC in terms of confidential issues. ABC was given a mandate by the government to spearhead Malaysia's foray into the high technology industry of aerospace and composites manufacturing.

The objective of the establishment of ABC is to become the manufacturing arm for ABC's work cluster. ABC created the work cluster with the aim to provide design, manufacturing and aircraft production services to relevant industries. This company fits into the business plan by participating in manufacturing activities for sub-contract work. To date, ABC has succeeded in securing major wing manufacturing programmed with leading aerospace companies, BAE systems, specifically for the manufacture of Airbus A300, A320 and A380 range of aircrafts. The company has also secured non-aerospace composites component manufacturing of the Alvis Bridging Launch Rail in Advance Composites. Within a short span of time since its formation, ABC has emerged as a leading aerospace company in the

fully lean organization can only be reached if the employees are well aligned with new philosophy. In that case, it is important for an organization to understand and apply all lean behavior practices and principles, in addition to a comprehensive lean thinking which affects the whole business model as a key and not solely learner production. **Figure 1** shows the key participants in a business, each having a relationship governed by processes and behaviors governing generative relationships. Each of these relationships should be carefully managed in order to minimize waste and maximize the benefits to productivity

Fig. 1. Enhancing Productivity Through Lean Behaviors In A Business

The Company where the case study was conducted was incorporated on 16th August 1994. Currently, numbers of employees are 1155 person. The nature of business for this company is to manufacture composites components for aero and non aero structures. The name of this company is changed to ABC in terms of confidential issues. ABC was given a mandate by the government to spearhead Malaysia's foray into the high technology industry of

The objective of the establishment of ABC is to become the manufacturing arm for ABC's work cluster. ABC created the work cluster with the aim to provide design, manufacturing and aircraft production services to relevant industries. This company fits into the business plan by participating in manufacturing activities for sub-contract work. To date, ABC has succeeded in securing major wing manufacturing programmed with leading aerospace companies, BAE systems, specifically for the manufacture of Airbus A300, A320 and A380 range of aircrafts. The company has also secured non-aerospace composites component manufacturing of the Alvis Bridging Launch Rail in Advance Composites. Within a short span of time since its formation, ABC has emerged as a leading aerospace company in the

**6. Background of case study**

aerospace and composites manufacturing.

enhancing.

region and a known industry player in the world. Though ABC having start to implement Lean Manufacturing System since 2004, but there are some mistakes and frailness due to the lack of implementation which is observed as in production system, where the knowledge and understanding of lean manufacturing system as common and primary root cause problem. The whole of problems occurred throughout from the top level to the bottom. Due to this, the top management commitment, teamwork, and people capabilities in eliminating wastages are also lacking. Furthermore, the problems occurred because the lean implementation was not linking to the individual, department, and company's key performance indicator which was unmotivated the total employees of the company to practice the real of lean concepts. Therefore, based on this reality the lean behavior among the employees never rooted. Effectively in the end of 2006, the company overcomes the past problems with new perspective of lean implementation by developing the integration and heuristic approach of lean concepts as a new strategy that involve all aspects of the company in their operation that correlated to the KPI. The scope of study for this project is conducted only at kitting department.

#### **7. Developing a new system to productivity enhancing**

In today's competitive world, no company can afford to waste resources. The most underutilized resource of most manufacturing company is their people assets. The number one asset of any organization is also its people. In fact, people are one of the few appreciating asset an organization has. The real advantages of employee's involvement are to focus a group of employees with different perspective on a single objective that support the organization's strategic focus. The companies that develop and leverage the capabilities of all their employees will achieve better performance than those that do not. The companies that fail to unlock the potential of their workforce will be forced to carry more overhead, have more layers of management, will be slower to react to market change and opportunities. Therefore, since we implement lean as a system in which the people functions need to be developed into a system which called "People Management Systems" to provide the capability for rapid improvement and adoption to change. Each of the three systems in framework has its own objective. The objective of the lean process management system is to identify and eliminate wastages by removing non value added activities. People management systems need to provide the capability for rapid improvement and adoption to change. Here, again, we must accept the fact that change is inevitable and that the speed with which the necessary modification are made is the deciding factor in our survival. The objective of the business management system is to apply carefully the organization's limited resources, including capital and hard assets as well as time and human assets. Three integration elements with total employee involvement from top to bottom play an important role for sustaining problem solving among employees in practicing lean concept. It is important to create people development system which consists of all these three elements with total involvement of people to increase problem solving capability. People management system, Business management system and lean process management system are integrated by principles that, in a sense, hold them together. These principles are meant to provide a framework (**Figure 2**) to focus the direction in enhancing productivity and problem solving capability among employees by forming as people development system in lean process management. They are:

Enhancing Productivity Through Lean Behavior 303

 KPI in lean process management determination through Mission, Core Value, Vision, Objective, Strategy, Strategy Initiative and Personal Objective for people development system is crucial. This will align overall workforce of the company to follow one common goal. Each level has its own portion of contribution towards the target. The results are compared with the target or goal used to measure the success of KPI. The accumulation of success from each portion will reflect the overall achievement of the

 Respect for people in lean process management is another crucial factor in developing the lean culture throughout organization. In order to measure the lean behaviors, top management commitment, leanness level of the company and perception of team member's capability, Liker (2004) type scale is used to get the responses from respondent. For example, one can ask managers to rate the degree of support by top management on five-point scale from no support (1) to total support (5). Beside this, the problem solving capability also can be measured by counting the number of ideas

 Skill and Knowledge in lean process management is the fundamental requirement for employees to equip themselves. Without this they can't perform well in solving problem to identify and eliminate wastages. Lean tools and assessment techniques by using assessment criteria to determine the level of implementation using spider web chart with rating of 1 (beginning to introduce) to 5 (practice with excellent). Another measurement on employee skill metric will emphasize on employees skill and their

Table 2. An Analytical Framework For Measuring Problem Solving Capability In Lean

To conduct the case study survey, the questionnaire was used which was developed by the Ford Motor company. The questionnaires contain the criteria of lean behavior practices based on the literature review Orr (2005). The lean behavior practices are divided into three

generated, Level of people involved and the total cost of the project.

company goal.

cross functionality.

Process Management

**9. Methodology**

Another important element incorporated with this people development system framework is teamwork of top, middle and bottom management. The total commitment of all these three levels will enhance the productivity and the problem solving capability in lean process management among employees.

Fig. 2. PDS Framework for Enhancing Productivity and Problem Solving Capabilities Among Employees.

#### **8. Key characteristic, critical success factors (CSF) and related performance matrix**

The following key characteristics, CSFs and related performance metrics are identified A.P. Puvanasvaran et al (2008), as crucial in people development system of lean process management and are highlighted in **Table 2**.

Key performance indicator - KPI for every level such as company, department, section

Respect for people – Respect for people which mainly focuses on the lean behaviors that

 Skill and Knowledge – Skill and Knowledge for employees will support them in practicing lean concept effectively and efficiently by utilizing the lean tool and

Another important element incorporated with this people development system framework is teamwork of top, middle and bottom management. The total commitment of all these three levels will enhance the productivity and the problem solving capability in lean process

Fig. 2. PDS Framework for Enhancing Productivity and Problem Solving Capabilities

**8. Key characteristic, critical success factors (CSF) and related performance**

The following key characteristics, CSFs and related performance metrics are identified A.P. Puvanasvaran et al (2008), as crucial in people development system of lean process

and individual levels which is linked towards the organization goal.

each employee in organization should build in their mind.

techniques.

Among Employees.

management and are highlighted in **Table 2**.

**matrix**

management among employees.

#### **9. Methodology**

To conduct the case study survey, the questionnaire was used which was developed by the Ford Motor company. The questionnaires contain the criteria of lean behavior practices based on the literature review Orr (2005). The lean behavior practices are divided into three

Enhancing Productivity Through Lean Behavior 305

questionnaire only rated by kitting area department for the last two level respondents. The

After getting the result from company, authors will use the software SPSS version 13 to make the analysis. In the 2 part of the question (about lean behavior), the outputs of the analysis were in the form of index values, percentages and hypothesis testing. In the literature review state that Emiliani and Stec (2004) explain lean behavior is applying lean principles and tools to improve leadership behaviors and eliminate behavioral waste.

In order to assess the lean behavior before and after the lean implementation, a questionnaire was distributed and then an internal consistency analysis was used to

The questionnaire distributed directly to the employees to do the survey. The beginning of the year (January) questionnaire was distributed to 45 employees of the kitting department. However, 3 employees already resign. Thus, the questionnaire only assigned by 42 people and the feedback collected exactly 42 respondent results. At the end of the year,

Internal Consistency Analysis: An internal consistency analysis was used to assess the reliability of questionnaire. It is an indicator of how well the different items measure the same issue. The measurement of internal consistency involve for calculation of Cronbanch's coefficient alpha. The values of alpha range from 0 to 1 where the value close to 1 indicate higher reliability. Alpha value should be positive and usually greater than 0.7 which are considered acceptable for testing the reliability of factors. As shown in **table 3**, the alpha value for the January 2007 in the three categories range is from 0.721 to 0.821. For respect for People, the scale of reliability can be increased by eliminating Q02 which show 0.815. For Continuous Learning and Improvement, the scale of reliability it is better to include all of the nine questions and if any questions were eliminated, will reduce the scale reliability. Last but not least for Process and Result Drive, the scale of reliability can be improved by eliminating Q30 which show 0.829. For the December 2007 the alpha value in three categories ranges from 0.718 to 0.758. For respect for People, the scale reliability can be increased by eliminating Q03 which show 0.739. For Continuous Learning and Improvement & Process and Result Driven the scale of reliability were reduced Q12 and

Although, the alpha value for the 3 categories for December 2007 is decreased when compare with January 2007, but the range is greater than 0.7, so the instrument are consider acceptable. Furthermore, the elimination questions are not necessary as the alpha value increase slightly after eliminating. Since the alpha value are greater than 0.7, it can conclude

questionnaire was distributed to 44 people and collected back exactly 44 responds.

feedback is received within two weeks from the company.

**9.3 Analysis using SPSS**

**10. Results and discussion**

**10.1 Respondent rate**

**10.2 Reliability test**

Q23,which show 0.768 and 0.801.

that this instrument is reliable.

evaluate the reliability of questionnaire.

categories which are; respect for people (RFP), continuous learning and improvement (CL&I) and process and result driven (P&RD). This is exactly to fulfill the Toyota "4 P model" Orr. For the RFP and CL&I, there are nine variables asked, and for P&RD, there are twelve variables to answer. The answers of questionnaire were using the four-point scale and circle the appropriate number. The response scale ranges from 1 to 4 representing the range of strongly agree, agree, disagree, and strongly disagree.

The index value is used to determine the strength and weakness of lean behavior practices. The index value is calculated by formula provided by Nesan and Holt (2002).

#### **Index = [ ( n1 ) + 2 ( n2 ) +3 ( n3 ) + 4 ( n4 ) ] / [ 4 ( n1 + n2 + n3 + n4 ) ],**

Where n1,…, n4 represent the number of respondents that indicated the respective practices on the scale 1 to 4. The formula yields indices ranging from 0 to 1, where below 0.2 represent minimum strength and above 0.8 represents maximum strength

Nesan and Holt (2002). The second analysis is to determine the relationship or mean score of each level of management for each practice. Analysis of variance (ANOVA) is used to analyses situations in which there are several independent variables and how these independent variables interact with each other Field. Before calculating the ANOVA, one assumption must be considered is the score of variable is normally distributed. For the third analysis, correlation is used to measure the difference between each principle variables and how are they related. Before calculating a correlation coefficient, there are a few assumptions for correlation analysis which are normality and linearity Coakes (2005). Pearson's correlation coefficient is a measure of linear association with the score for each variable is normal distributed. If the relationship is not linear and normal distributed, Spearman's rho will be used to measure the correlation between the variables Coakes (2005).

#### **9.1 Pilot test**

Pilot test is conducted to ensure the finding from the questionnaire is valid and meet the objective of this project. This is done by sending the questionnaire to two lean expertise of the company. Discussion on the questionnaire was held when the company was visited. Opinion was given which help researcher to modify the questionnaire. Besides that, from the pre-test, the total time spend to answer the questionnaire also can be identified.

#### **9.2 Sending and receiving questionnaire**

The questionnaires send to a composite manufacturing company in Malaysia. The questionnaire is directed to three levels of the company, which are, top management, engineers and operators, and shop floor workers. For the top management level respondent, the questionnaires were answered by all department of the company. Meanwhile, the questionnaire only rated by kitting area department for the last two level respondents. The feedback is received within two weeks from the company. The total feedbacks are 53. The questionnaires send to one of composite manufacturing company in Malaysia. The questionnaire is directed to three levels of the company, which are, top management, engineers and operators, and shop floor workers. For the top management level respondent, the questionnaires were answered by all department of the company. Meanwhile, the questionnaire only rated by kitting area department for the last two level respondents. The feedback is received within two weeks from the company.

#### **9.3 Analysis using SPSS**

304 Theoretical and Methodological Approaches to Social Sciences and Knowledge Management

categories which are; respect for people (RFP), continuous learning and improvement (CL&I) and process and result driven (P&RD). This is exactly to fulfill the Toyota "4 P model" Orr. For the RFP and CL&I, there are nine variables asked, and for P&RD, there are twelve variables to answer. The answers of questionnaire were using the four-point scale and circle the appropriate number. The response scale ranges from 1 to 4 representing the

The index value is used to determine the strength and weakness of lean behavior practices.

**Index = [ ( n1 ) + 2 ( n2 ) +3 ( n3 ) + 4 ( n4 ) ] / [ 4 ( n1 + n2 + n3 + n4 ) ],**  Where n1,…, n4 represent the number of respondents that indicated the respective practices on the scale 1 to 4. The formula yields indices ranging from 0 to 1, where below 0.2 represent

Nesan and Holt (2002). The second analysis is to determine the relationship or mean score of each level of management for each practice. Analysis of variance (ANOVA) is used to analyses situations in which there are several independent variables and how these independent variables interact with each other Field. Before calculating the ANOVA, one assumption must be considered is the score of variable is normally distributed. For the third analysis, correlation is used to measure the difference between each principle variables and how are they related. Before calculating a correlation coefficient, there are a few assumptions for correlation analysis which are normality and linearity Coakes (2005). Pearson's correlation coefficient is a measure of linear association with the score for each variable is normal distributed. If the relationship is not linear and normal distributed, Spearman's rho will be used to measure the correlation between the variables Coakes (2005).

Pilot test is conducted to ensure the finding from the questionnaire is valid and meet the objective of this project. This is done by sending the questionnaire to two lean expertise of the company. Discussion on the questionnaire was held when the company was visited. Opinion was given which help researcher to modify the questionnaire. Besides that, from

The questionnaires send to a composite manufacturing company in Malaysia. The questionnaire is directed to three levels of the company, which are, top management, engineers and operators, and shop floor workers. For the top management level respondent, the questionnaires were answered by all department of the company. Meanwhile, the questionnaire only rated by kitting area department for the last two level respondents. The feedback is received within two weeks from the company. The total feedbacks are 53. The questionnaires send to one of composite manufacturing company in Malaysia. The questionnaire is directed to three levels of the company, which are, top management, engineers and operators, and shop floor workers. For the top management level respondent, the questionnaires were answered by all department of the company. Meanwhile, the

the pre-test, the total time spend to answer the questionnaire also can be identified.

The index value is calculated by formula provided by Nesan and Holt (2002).

range of strongly agree, agree, disagree, and strongly disagree.

minimum strength and above 0.8 represents maximum strength

**9.1 Pilot test**

**9.2 Sending and receiving questionnaire**

After getting the result from company, authors will use the software SPSS version 13 to make the analysis. In the 2 part of the question (about lean behavior), the outputs of the analysis were in the form of index values, percentages and hypothesis testing. In the literature review state that Emiliani and Stec (2004) explain lean behavior is applying lean principles and tools to improve leadership behaviors and eliminate behavioral waste.

#### **10. Results and discussion**

In order to assess the lean behavior before and after the lean implementation, a questionnaire was distributed and then an internal consistency analysis was used to evaluate the reliability of questionnaire.

#### **10.1 Respondent rate**

The questionnaire distributed directly to the employees to do the survey. The beginning of the year (January) questionnaire was distributed to 45 employees of the kitting department. However, 3 employees already resign. Thus, the questionnaire only assigned by 42 people and the feedback collected exactly 42 respondent results. At the end of the year, questionnaire was distributed to 44 people and collected back exactly 44 responds.

#### **10.2 Reliability test**

Internal Consistency Analysis: An internal consistency analysis was used to assess the reliability of questionnaire. It is an indicator of how well the different items measure the same issue. The measurement of internal consistency involve for calculation of Cronbanch's coefficient alpha. The values of alpha range from 0 to 1 where the value close to 1 indicate higher reliability. Alpha value should be positive and usually greater than 0.7 which are considered acceptable for testing the reliability of factors. As shown in **table 3**, the alpha value for the January 2007 in the three categories range is from 0.721 to 0.821. For respect for People, the scale of reliability can be increased by eliminating Q02 which show 0.815. For Continuous Learning and Improvement, the scale of reliability it is better to include all of the nine questions and if any questions were eliminated, will reduce the scale reliability. Last but not least for Process and Result Drive, the scale of reliability can be improved by eliminating Q30 which show 0.829. For the December 2007 the alpha value in three categories ranges from 0.718 to 0.758. For respect for People, the scale reliability can be increased by eliminating Q03 which show 0.739. For Continuous Learning and Improvement & Process and Result Driven the scale of reliability were reduced Q12 and Q23,which show 0.768 and 0.801.

Although, the alpha value for the 3 categories for December 2007 is decreased when compare with January 2007, but the range is greater than 0.7, so the instrument are consider acceptable. Furthermore, the elimination questions are not necessary as the alpha value increase slightly after eliminating. Since the alpha value are greater than 0.7, it can conclude that this instrument is reliable.

Enhancing Productivity Through Lean Behavior 307

the strength and weakness of lean behavior practices within the organization. Dimension 2 explored the relationship between the lean principles. For each dimension, four Likert (2004) scales ranging from 1 to 4 were provided and the scale was used is the agreement scale. Agreement scale is used to determine agreement on of the 30 lean behaviors practices, the

Data obtained from the survey were subjected to relative index calculations for agreement

 **Index = [ ( n1 ) + 2 ( n2 ) +3 ( n3 ) + 4 ( n4 ) ] / [ 4 ( n1 + n2 + n3 + n4 ) ],**  Where n1, n2 , n3 , n4 represent the number of respondents that indicated the respective practices on the scale 1 to 4. The formula yields indices ranging from 0 to 1, where below 0.2 represent minimum strength and above 0.8 represents maximum strength Nesan and Holt (2002). From the **table 4**, the indices calculated for all of the lean practices showed a similar pattern, with indices ranging between 0.464 and 0.78 for January 2007. For the December 2007, the range is between 0.597 and 0.818. In addition, the min index for 30 practices also increased from 0.691 to 0.7614, total increments is about 10%. This indicates that lean behavior practices in aerospace composite manufacturer are improved, and it is near to the lean behavior standard. After comparing the 2 group of index, we found that the index for

However, there is also some practices need to be improved where the indices show

Basically, for the new result, many performances were practiced very well. It can be seen clearly In **Figure 3** and the sum of index of practices is increased a lot and meets the lean behavior standard (0.800) already. The results are better if compared with the January 2007 which is totally negative and only one practice meet the lean behaviors standard. Below are

scale ranged from 1 (strongly disagree) to 4 (strongly agree).

factor. The relative index was calculated by using the formula:

People from outside areas help to solve problems.+0.207

People share ideas and knowledge-from 0.667 to 0.818

People look for ways to improve their work –from 0.750 to 0.801

 People contribute openly and honestly in the meetings I attend.-0.029 People are coached and trained by their leaders/Supervisors.-0.017

Before making decisions, people gather the information –from 0.708 to 0.818

People are encouraged to improve their knowledge and skills at work -0.738 to 0.813

People focus on the customer and the customer need (inside and outside the plant) -

However, one of the practices that needs improvement and need to be given more attention

the practices is increased a lot. Such are:

People share ideas and knowledge.+0.151

People deliver what was promised.-0.013

is the indices showed very low. The practice is:

the practices that meet the standard:

from 0.750 - 0.818.

Meetings start on time.+0.215

dropped. Such practices are:

**10.4 Analysis of strength and weakness of the lean behaviors practice**

Table 3. Reliability Statistic January 2007 and December 2007

#### **10.3 Analysis and results**

The structured postal questionnaire survey was designed to assess initial literature search finding concerning the 30 practices, in two different dimensions. Dimension 1 investigated

Table 3. Reliability Statistic January 2007 and December 2007

The structured postal questionnaire survey was designed to assess initial literature search finding concerning the 30 practices, in two different dimensions. Dimension 1 investigated

**10.3 Analysis and results**

the strength and weakness of lean behavior practices within the organization. Dimension 2 explored the relationship between the lean principles. For each dimension, four Likert (2004) scales ranging from 1 to 4 were provided and the scale was used is the agreement scale. Agreement scale is used to determine agreement on of the 30 lean behaviors practices, the scale ranged from 1 (strongly disagree) to 4 (strongly agree).

#### **10.4 Analysis of strength and weakness of the lean behaviors practice**

Data obtained from the survey were subjected to relative index calculations for agreement factor. The relative index was calculated by using the formula:

#### **Index = [ ( n1 ) + 2 ( n2 ) +3 ( n3 ) + 4 ( n4 ) ] / [ 4 ( n1 + n2 + n3 + n4 ) ],**

Where n1, n2 , n3 , n4 represent the number of respondents that indicated the respective practices on the scale 1 to 4. The formula yields indices ranging from 0 to 1, where below 0.2 represent minimum strength and above 0.8 represents maximum strength Nesan and Holt (2002). From the **table 4**, the indices calculated for all of the lean practices showed a similar pattern, with indices ranging between 0.464 and 0.78 for January 2007. For the December 2007, the range is between 0.597 and 0.818. In addition, the min index for 30 practices also increased from 0.691 to 0.7614, total increments is about 10%. This indicates that lean behavior practices in aerospace composite manufacturer are improved, and it is near to the lean behavior standard. After comparing the 2 group of index, we found that the index for the practices is increased a lot. Such are:

However, there is also some practices need to be improved where the indices show dropped. Such practices are:

Basically, for the new result, many performances were practiced very well. It can be seen clearly In **Figure 3** and the sum of index of practices is increased a lot and meets the lean behavior standard (0.800) already. The results are better if compared with the January 2007 which is totally negative and only one practice meet the lean behaviors standard. Below are the practices that meet the standard:

However, one of the practices that needs improvement and need to be given more attention is the indices showed very low. The practice is:

Enhancing Productivity Through Lean Behavior 309

 Plant leadership is on the plant floor daily to provide assistance and improve the business is 0.597. However; the index also improved already, for the Jan 2007 just

Beside the index, after comparing the 2 group of ranking the authors found that the ranking

People share ideas and knowledge, it is raise 20 rank, from ranking 21 raise to 1. It is the

Before making decisions, people gather information. It is raise to 16 rank, from ranking

People from outside help to solve the problem. It is raised 14 rank, from ranking 28

The result at **Table 5** shows that the increment respects for people was the highest. The practices for RFP such as, people contribute openly and honestly in the meeting will give employees operational autonomy encouraged an innovative culture and let employee contribute more ideas to solving problems. Furthermore, the practices "people can participate in decision relevant to their job and focus on the problem" in RFP also got strong relationship with PSC. In a study among the employees of a manufacturing plant, it found a positive relationship between participation and employees' innovative behavior, measured using self-ratings of employees' suggestions and implementation efforts will contribute to

0.464.

biggest lift practices:

Fig. 3. Strength of Lean Practices.

the idea of solving problem.

Table 5. Analysis Mean Value Index RFP, CLAI, PARD.

17 raise to 1.

raise to 14.

for the practices also change drastically. These are:

Table 4. Strength Values For January 2007 and December 2007

Table 4. Strength Values For January 2007 and December 2007

 Plant leadership is on the plant floor daily to provide assistance and improve the business is 0.597. However; the index also improved already, for the Jan 2007 just 0.464.

Beside the index, after comparing the 2 group of ranking the authors found that the ranking for the practices also change drastically. These are:

Fig. 3. Strength of Lean Practices.

The result at **Table 5** shows that the increment respects for people was the highest. The practices for RFP such as, people contribute openly and honestly in the meeting will give employees operational autonomy encouraged an innovative culture and let employee contribute more ideas to solving problems. Furthermore, the practices "people can participate in decision relevant to their job and focus on the problem" in RFP also got strong relationship with PSC. In a study among the employees of a manufacturing plant, it found a positive relationship between participation and employees' innovative behavior, measured using self-ratings of employees' suggestions and implementation efforts will contribute to the idea of solving problem.

Table 5. Analysis Mean Value Index RFP, CLAI, PARD.

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Respect for People and Continuous Learning and Improvement is 0.456, and the significance value of this coefficient is 0.001. But for December 2007, the values become 0.129, and significance value is 0.202 while the correlation coefficient between Respect for People and Process and Result Driven is 0.526 with the significance value is 0. But for new result it is 0.101 and the significance value is 0.258.last but not least, correlation coefficient between Continuous Learning and improvement and Process and Result Driven is 0.193 with the

significance value is 0.111. For new result is 0.310 and 0.020.

Table 7. Correlation between Factors In December 2007

Fig. 5. Comparison for Lean Behaviors.

Table 8. Index Value of Lean Behavior In January 2007 and December 2007

**11. Success of people development system in case study company**

the real life data of kitting department as the company case study.

The importance of problem solving capabilities of every employee in implementing lean process management to make the improvement in lean behaviors is evident as depicted by

The **Figure 4** shows that index value of three main categories which all have significant increase. Especially, respect for people, which is increased from 0.67 to 0.773. This is followed by continuous learning and improvement raised from 0.679 to 0.763 and the process and results driven shows improvement from 0.653 to 0.698 in each. Overall the results shows the company improved in all 3 construct, Thus, we can say, the company really put a lot of effort in practices lean behavior as shown in the comparison of lean behaviors in **Table 8 and Figure 5**. In conclusion, authors found that most practices of the lean behavior will improve the PSC of the employee. Thus, after implementing lean process after one year, problem solving capability of employee had been increased and make the lean result of company increase.

#### **10.5 Analysis of the relationship between the lean principles**

Correlation between Respect for People, Continuous Learning and improvement and Process and Result Driven are shown in **Table 6 and Table 7**. The data obtained was analyzed by using Statistical Package for Social Science (SPSS) software version 13. Correlation method was used where correlation is a measure of relationship involving variables Field. **Table 6** and **Table 7** show a matrix that is displayed giving the correlation between the three variables. For the January 2007correlation coefficient 0.587 between

Table 6. Correlation between Factors In January 2007.

Fig. 4. Lean Behaviors Index Value

The **Figure 4** shows that index value of three main categories which all have significant increase. Especially, respect for people, which is increased from 0.67 to 0.773. This is followed by continuous learning and improvement raised from 0.679 to 0.763 and the process and results driven shows improvement from 0.653 to 0.698 in each. Overall the results shows the company improved in all 3 construct, Thus, we can say, the company really put a lot of effort in practices lean behavior as shown in the comparison of lean behaviors in **Table 8 and Figure 5**. In conclusion, authors found that most practices of the lean behavior will improve the PSC of the employee. Thus, after implementing lean process after one year, problem solving capability of employee had been increased and make the lean result of company increase.

Fig. 4. Lean Behaviors Index Value

**10.5 Analysis of the relationship between the lean principles**

Table 6. Correlation between Factors In January 2007.