The role of the dutch business system in effectively implementing lean management

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1. Introduction

1.1 Problem Indication

Nowadays lean management is being implemented in many organizations all over the world. Lean management is about reducing waste as much as possible and about doing things simple and thereby constantly improving those things (Slack, Chambers & Johnston, 2007).

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It has been implemented effectively in many industries and organizations such as Wal-Mart and emergency departments (Dickson, Singh, Sheung, Wyatt & Nugent, 2009; Schonberger, 2007). However, there is also evidence that lean management is often not effectively implemented or even considered as a failure (Schonberger, 2007). Multiple studies have been trying to explain what kind of factors influence the success or failure of implementing lean management in organizations (Bhasin & Burcher, 2006).

For decades authors have argued that organizations and industries are influenced by institutions in their environment (Tempel & Walgenbach, 2007; Scott, 1995). It therefore seems important to have a better understanding of the institutions around us. The term ‘institutions’, however, is very broad. According to North (1991, p. 97) institutions are “the humanly devised constraints that structure political, economic and social interaction. They consist of both informal constraints (sanctions, taboos, customs, traditions, and codes of conduct), and formal rules (constitutions, laws, property rights)”. Practical examples of institutions are the educational and the financial system. Formal institutions are easier to identify and to discern than informal institutions. In this study the focus will be on formal institutions, thereby limiting the field of investigation.

Furthermore, this study follows the business systems approach developed by Whitley (1992b). According to this approach, business systems are explained by institutions. A business system is seen as “particular ways of organizing, controlling and directing business enterprises that become established as the dominant forms of business organization in different societies” (Whitley, 1992b, p. 125). In other words, the characteristics of a business system show how the economy is organized. According to Whitley (1992a) nations have a highly significant influence on their domestic institutions, because “state actions determine the effectiveness and role of formal institutions in governing many important aspects of economic coordination” (Whitley, 1999, p. 44).Therefore business systems are situated at the national level and this is also the reason why they are different among nations. A practical example of a business system is the compartmentalized business system, to which e.g. the U.S.A. belongs. It is characterized by a highly mobile workforce, shareholder control, well-developed capital markets, and an unregulated labor market. This is very different from the business system in the Netherlands, but its characteristics will be discussed later. It should be stated that some characteristics of the Dutch business system are quite similar to the characteristics of other business systems such as the German. Furthermore, this study recognizes that institutions are sometimes not situated at the level of the nation because e.g.

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