Searching for Complementarity in Lean Manufacturing Settings

The paper aims to test and validate the complementarity effects on operational performance of two of the main lean manufacturing bundles, Just in Time (JIT) and Total Quality Management (TQM). The paper also explores the role played by the Human Resource Management (HRM) bundle as an enhancer of the complementarity between JIT and TQM. The paper is based on statistical analysis on the High Performance Manufacturing round III database, a survey that involves 266 plants in nine countries across three different industries (electronics, machinery and transportation components). The paper proves the existence of complementarity between JIT and TQM and shows the enabling role of HRM on such complementarity. Research implications. The paper provides analytical and empirical argumentations showing that JIT and TQM mutually reinforce each other’s marginal returns on operational performance. The study also indicates that only those plants characterized by a significant implementation of HRM practices enjoy the complementarity effects of TQM and JIT on operational performance. The research suggests a pattern of improvements where JIT and TQM have to be implemented hand-in-hand to take full advantage of their complementarity. HRM, the soft part of lean initiatives, provides the ground over which complementarity originates, spreading its benefits throughout the organization.