Enhancing Inventory Performance in Manufacturing Supply Chains Through Lean Six Sigma: A Case Study
DOI:
https://doi.org/10.55578/jdso.2605.006Keywords:
Lean Six Sigma, DMAIC, Inventory Optimization, Manufacturing Systems, Inventory Control, Supply Chain Performance, Operational Efficiency, Process ImprovementAbstract
Effective inventory management is a critical determinant of operational efficiency, cost control, and service performance in increasingly volatile manufacturing environments. While Lean Six Sigma (LSS) is widely established as a methodology for waste reduction and process variability minimization, its structured application to inventory strategy and performance optimization remains comparatively underdeveloped in the literature. Existing inventory management practices are frequently constrained by fragmented decision-making, weak process integration, and limited responsiveness to demand uncertainty, leading to persistent inefficiencies such as excess stock, stockouts, and elevated holding costs. This study develops and empirically implements a Lean Six Sigma–based, DMAIC-driven framework for inventory optimization, integrating core tools including value stream mapping, root cause analysis, 5S, process mapping, and performance measurement systems. The framework operationalizes inventory management as a structured, data-driven process aligned with key performance indicators, enabling systematic identification of inefficiencies and targeted improvement interventions. The framework is applied in a medium-sized Egyptian electrical control panel manufacturer characterized by significant inventory inefficiencies, including high carrying costs, prolonged lead times, excess inventory, and recurring stockouts. The DMAIC implementation yields statistically and operationally meaningful improvements across multiple performance dimensions: inventory turnover increases by 20%, on-time order fulfillment improves by 15%, carrying costs decrease by 22%, lead times are reduced by 25%, stockout rates decline by 30%, and inventory accuracy improves by 15%. Overall, the findings demonstrate that Lean Six Sigma can effectively reconfigure inventory management from a reactive, fragmented system into a structured, performance-driven, and continuously improving operational capability. The proposed framework contributes both theoretically and practically by providing an empirically grounded, context-sensitive approach to inventory optimization in resource-constrained manufacturing environments.
References
1. Cheng, J.L., 2017. Improving inventory performance through Lean Six Sigma approaches. IUP Journal of Operations Management, 16(3); pp.23-38.
2. Hong, C., 2017, November. Implementing Lean Six Sigma to achieve inventory control in supply chain management. In AIP Conference Proceedings (Vol. 1902, No. 1, p. 020037). AIP Publishing LLC.
3. Cabral, C.D.O., Monteiro, M.M., Quelhas, O.L.G., and Ribeiro, P.C.C., 2018, December. Using Lean Six Sigma for the Optimization of Inventory Management—A Case of a Lubricating Oil Factory. In International Conference on Production and Operations Management Society (pp. 569-578). Cham: Springer International Publishing.
4. Gomaa, A.H., 2025. Manufacturing supply chain excellence through Lean Six Sigma: A case study approach. Global Journal of Industrial Management, 1(1), pp.2032-2032.
5. Aruleswaran, A., Muraliraj, J. and Zailani, S., 2026. Lean six sigma and sustainable supply chain management: A case study in electric vehicle parts manufacturing. International Journal of Lean Six Sigma, 17(1), pp.147-169.
6. Akindipe, O.S., 2014. Inventory Management: A Tool for optimal use of resources and overall efficiency in manufacturing SMEs. Journal of Entrepreneurship, Management and Innovation, 10(4), pp.93-114.
7. Rodrigo, W.L.M.P.U., Rathnayake, R.M.S.S., and Pathirawasam, C., 2020. Effect of inventory management on financial performance of listed manufacturing companies in Sri Lanka. IAR Journal of Business Management, 1(4), pp.383-389.
8. Freitag, A.E.B. and Quelhas, O.L.G., 2019. Lean Manufacturing Application Analysis in the Inventory Management. Industrial Engineering and Operations Management I: XXIV IJCIEOM, Lisbon, Portugal, July 18–20, p.207.
9. Emar, W., Al-Omari, Z.A., and Alharbi, S., 2021. Analysis of inventory management of slow-moving spare parts by using ABC techniques and EOQ model: a case study. Indonesian Journal of Electrical Engineering and Computer Science, 23(2), pp.1159-1169.
10. Anichebe, N.A. and Agu, O.A., 2013. Effect of inventory management on organizational effectiveness. In Information and knowledge management (Vol. 3, No. 8, pp. 92-100).
11. Kumar, G., Nebhnani, R., and Sharma, R., 2022. Inventory Management of Automotive Industries using ABC Analysis: A Systematic Approach. Journal of Industrial Engineering International, 4(3), p.27.
12. Haekal, J. and Setiawan, I., 2020. Comparative analysis of raw materials control using JIT and EOQ method for cost efficiency of raw material supply in automotive components company Bekasi, Indonesia. International Journal of Engineering Research and Advanced Technology, 6(10), pp.76-82.
13. Geng, X., Li, Y., Wang, L., Zhang, L., Yang, Q., Ye, J., and Liu, Y., 2019, July. Spatiotemporal multi-graph convolution network for ride-hailing demand forecasting. In Proceedings of the AAAI Conference on Artificial Intelligence (Vol. 33, No. 01, pp. 3656-3663).
14. Schmidt, M.C., Veile, J.W., Müller, J.M. and Voigt, K.I., 2023. Industry 4.0 implementation in the supply chain: a review on the evolution of buyer-supplier relationships. International Journal of Production Research, 61(17), pp.6063-6080.
15. Stojkanović, D., Petković, Z. and Ivanov, L., 2021. Just in Time as a modern principle of inventory management. KNOWLEDGE-International Journal, 45(1), pp.193-197.
16. Mor, R.S., Kumar, D., Yadav, S. and Jaiswal, S.K., 2021. Achieving cost efficiency through increased inventory leanness: Evidence from manufacturing industry. Production Engineering Archives, 27(1), pp.42-49.
17. Yadav, M.V.S., 2026. The Effect of Inventory Management Practices on Organizational Cost Reduction and Performance. Applied-Finance Letters, 15(1), pp. 571-577.
18. Antony, J., Setijono, D. and Dahlgaard, J.J., 2016. Lean Six Sigma and Innovation–an exploratory study among UK organisations. Total Quality Management & Business Excellence, 27(1-2), pp.124-140.
19. Gomaa, A.H., 2024. Improving productivity and quality of a machining process by using lean six sigma approach: A case study. Engineering Research Journal (Shoubra), 53(1), pp.1-16.
20. Antony, J., Snee, R. and Hoerl, R., 2017. Lean Six Sigma: yesterday, today and tomorrow. International Journal of Quality & Reliability Management, 34(7), pp.1073-1093.
21. Gomaa, A.H., 2023a. A systematic review of Lean Six Sigma in manufacturing domain. Engineering Research Journal (Shoubra), 52(4), pp.139-148.
22. Gomaa, A.H., 2023b. Operational Excellence for Improving Manufacturing Performance Using Lean Six Sigma. International Journal of Business and Administrative Studies, 9(2), p.1.
23. França, S.L.B., Dias, D.F., Freitag, A.E.B., Quelhas, O.L.G., and Meiriño, M.J., 2018, July. Lean manufacturing application analysis in the inventory management of a furniture industry. In International Joint Conference on Industrial Engineering and Operations Management (pp. 207-219). Cham: Springer International Publishing.
24. Trakulsunti, Y., Antony, J. and Douglas, J.A., 2020. Lean Six Sigma implementation and sustainability roadmap for reducing medication errors in hospitals. The TQM Journal, 33(1), pp.33-55.
25. Yang, K., Wu, Q. and Cormican, K., 2025. From the Great Wall to great workflow: Lean Six Sigma in Chinese listed companies. International Journal of Lean Six Sigma, 16(4), pp.946-971.
26. Benmamoun, Z., Hachimi, H. and Amine, A., 2017, April. Inventory management optimization using Lean Six Sigma. In Proceedings of the International Conference on Industrial Engineering and Operations Management (pp. 11-13).
27. Cherrafi, A., Elfezazi, S., Chiarini, A., Mokhlis, A., and Benhida, K., 2016. The integration of lean manufacturing, Six Sigma, and sustainability: A literature review and future research directions for developing a specific model. Journal of Cleaner Production, 139, pp.828-846.
28. Sin, A.B., Zailani, S., Iranmanesh, M., and Ramayah, T., 2015. Structural equation modelling on knowledge creation in Six Sigma DMAIC project and its impact on organizational performance. International Journal of Production Economics, 168, pp.105-117.
29. Mwangi, W. and Nyambura, M.T., 2015. The role of inventory management on performance of food processing companies: a case study of Crown Foods Limited, Kenya. European Journal of Business and Social Sciences, Vol. 4(4), pp. 64-78.
30. Golas, Z. and Bieniasz, A., 2016. Empirical analysis of the influence of inventory management on financial performance in the food industry in Poland. Engineering Economics, 27(3), pp.264-275.
31. Karim, N.A., Nawawi, A., and Salin, A.S.A.P., 2018. Inventory management effectiveness of a manufacturing company–Malaysian evidence. International Journal of Law and Management, 60(5), pp.1163-1178.
32. Anshur, A.S., Ahmed, M.M., and Dhodi, M.H., 2018. The role of inventory management on financial performance in some selected manufacturing companies in Mogadishu. International Journal of Accounting Research, 6(2), pp.1-6.
33. Shardeo, V., 2015. Impact of Inventory Management on the Financial Performance of the firm. IOSR Journal of Business and Management, 17(4), pp.1-12.
34. Shah, R. and Shin, H., 2007. Relationships among information technology, inventory, and profitability: An investigation of level invariance using sector-level data. Journal of Operations Management, 25(4), pp.768-784.
35. Khan, M.N. and Khokhar, I., 2014. Select financial ratios as a determinant of profitability evidence from petrochemical industry in Saudi Arabia. European Journal of Business and Management, 6(6), pp.187-196.
36. Khan, M.N. and Khokhar, I., 2015. The effect of selected financial ratios on profitability: an empirical analysis of listed firms of cement sector in Saudi Arabia. Quarterly Journal of Econometrics Research, 1(1), pp.1-12.
37. Hashed, A.W.A. and Shaik, A.R., 2022. The nexus between inventory management and firm performance: A Saudi Arabian perspective. The Journal of Asian Finance, Economics and Business, 9(6), pp.297-302.
38. Sunday, O. and Joseph, E.E., 2017. Inventory management and SMEs' profitability. A study of furniture manufacturing, wholesale and eatery industry in Delta State, Nigeria. Journal of Finance and Accounting, 5(3), pp.75-79.
39. Vastag, G. and Whybark, D.C., 2005. Inventory management: is there a knock-on effect?. International Journal of Production Economics, 93, pp.129-138.
40. Folinas, D. and Shen, C.Y., 2014. Exploring links among inventory and financial performance in the agricultural machinery. International Journal of Food and Agricultural Economics (IJFAEC), 2(4), pp.1-12.
41. Rumyantsev, S. and Netessine, S., 2007. Inventory and its relationship with profitability: evidence for an international sample of countries. Available at SSRN 2319862.
42. Alnaim, M. and Kouaib, A., 2023. Inventory turnover and firm profitability: a Saudi Arabian investigation. Processes, 11(3), p.716.
43. Andreou, P.C., Louca, C. and Panayides, P.M., 2016. The impact of vertical integration on inventory turnover and operating performance. International Journal of Logistics Research and Applications, 19(3), pp.218-238.
44. Kinney, M.R. and Wempe, W.F., 2002. Further evidence on the extent and origins of JIT's profitability effects. The Accounting Review, 77(1), pp.203-225.
45. Chen, H., Frank, M.Z., and Wu, O.Q., 2005. What actually happened to the inventories of American companies between 1981 and 2000?. Management Science, 51(7), pp.1015-1031.
46. Koumanakos, D.P., 2008. The effect of inventory management on firm performance. International Journal of Productivity and Performance Management, 57(5), pp.355-369.
47. Muchaendepi, W., Mbohwa, C., Hamandishe, T., and Kanyepe, J., 2019. Inventory management and performance of SMEs in the manufacturing sector of Harare. Procedia Manufacturing, 33, pp.454-461.
48. Mishra, U., Wu, J.Z., and Sarkar, B., 2021. Optimum sustainable inventory management with backorder and deterioration under controllable carbon emissions. Journal of Cleaner Production, 279, p.123699.
49. Mazanai, M., 2012. Impact of just-in-time (JIT) inventory system on efficiency, quality and flexibility among manufacturing sector, small and medium enterprise (SMEs) in South Africa. African Journal of Business Management, 6(17), p.5786.
50. Patrucco, A., Ciccullo, F. and Pero, M., 2020. Industry 4.0 and supply chain process re-engineering: A coproduction study of materials management in construction. Business Process Management Journal, 26(5), pp.1093-1119.
51. Relich, M., Nielsen, I. and Gola, A., 2022. Reducing the total product cost at the product design stage. Applied Sciences, 12(4), p.1921.
52. Kumar, S.S. and Mogha, S.K., 2024. Material management in automobile industry: Era 4.0. In E3S Web of Conferences (Vol. 529, p. 01049). EDP Sciences.
53. Letunovska, N., Offei, F.A., Junior, P.A., Lyulyov, O., Pimonenko, T., and Kwilinski, A., 2023. Green supply chain management: The effect of procurement sustainability on reverse logistics. Logistics, 7(3), p.47.
54. Kanecka, B., 2020. Material management in a manufacturing company. Acta Universitatis Nicolai Copernici. Zarządzanie, 47(2), pp.67-76.
55. Aruleswaran, A., 2010. Changing with Lean Six Sigma. LSS Academy, Malaysia.
56. Pfeifer, M.R., 2022. SMEs in automotive supply chains: a survey on six sigma performance perceptions of Czech supply chain members. Processes, 10(4), p.698.
57. Snee, R.D., 2010. Lean Six Sigma–getting better all the time. International Journal of Lean Six Sigma, 1(1), pp.9-29.
58. Swarnakar, V. and Vinodh, S., 2016. Deploying Lean Six Sigma framework in an automotive component manufacturing organization. International Journal of Lean Six Sigma, 7(3), pp.267-293.
59. Hu, B. and Tian, Y., 2011, September. Six Sigma applied in inventory management. In Advanced Engineering Forum (Vol. 1, pp. 355-359). Trans Tech Publications Ltd.
60. Rifqi, H., Zamma, A., Souda, S.B. and Hansali, M., 2021. Lean manufacturing implementation through DMAIC approach: A case study in the automotive industry. Quality Innovation Prosperity, 25(2), pp.54-77.
61. Puiu, I.R., Petre, I.M. and Boșcoianu, M., 2025. Targeting Toward Optimal Inventory in Automotive Industry—An Analysis Based on Six Sigma Methodology. Logistics, 10(1), p.8.
62. Raval, S.J., Kant, R. and Shankar, R., 2020. Analyzing the Lean Six Sigma enabled organizational performance to enhance operational efficiency. Benchmarking: An International Journal, 27(8), pp.2401-2434.
63. Shrafat, F.D. and Ismail, M., 2019. Structural equation modeling of lean manufacturing practices in a developing country context. Journal of Manufacturing Technology Management, 30(1), pp.122-145.
64. Achibat, F.E., Lebkiri, A., Lougraimzi, H., Berrid, N., and Maqboul, A., 2023. Analysis of the impact of Six Sigma and Lean Manufacturing on the performance of companies. Management Systems in Production Engineering, 31(2), pp.191-196.
65. Marques, P., Requeijo, J., Saraiva, P. and Frazão‐Guerreiro, F., 2013. Integrating Six Sigma with ISO 9001. International Journal of Lean Six Sigma, 4(1), pp.36-59.
66. Amjad, M.H.H., Shovon, M.S.S., and Hasan, A.S.M.M., 2024. Analyzing Lean Six Sigma practices in engineering project management: A comparative analysis. Innovatech Engineering Journal, 1(01), pp.245-255.
67. Goshime, Y., Kitaw, D., and Jilcha, K., 2019. Lean manufacturing as a vehicle for improving productivity and customer satisfaction: A literature review on metals and engineering industries. International Journal of Lean Six Sigma, 10(2), pp.691-714.
68. El-Khalil, R., Leffakis, Z.M., and Hong, P.C., 2020. Impact of improvement tools on standardization and stability goal practices: An empirical examination of US automotive firms. Journal of Manufacturing Technology Management, 31(4), pp.705-723.
69. Arumugam, V., Antony, J., and Kumar, M., 2013. Linking learning and knowledge creation to project success in Six Sigma projects: An empirical investigation. International Journal of Production Economics, 141(1), pp.388-402.
70. Trimarjoko, A., Hardi Purba, H., and Nindiani, A., 2020. Consistency of DMAIC phases implementation on Six Sigma method in manufacturing and service industry: a literature review. Management and Production Engineering Review.
71. Gupta, V., Jain, R., Meena, M.L., and Dangayach, G.S., 2018. Six-sigma application in tire-manufacturing company: a case study. Journal of Industrial Engineering International, 14(3), pp.511-520.
72. Antony, J., McDermott, O., Powell, D., and Sony, M., 2023. The evolution and future of Lean Six Sigma 4.0. The TQM Journal, 35(4), pp.1030-1047.
73. Subramaniyam, P., Srinivasan, K. and Prabaharan, M., 2011. An innovative lean six sigma approach for engineering design. International Journal of Innovation, Management and Technology, 2(2), p.166.
74. Albliwi, S.A., Antony, J., and Lim, S.A.H., 2015. A systematic review of Lean Six Sigma for the manufacturing industry. Business Process Management Journal, 21(3), pp.665-691.
75. Alkunsol, W.H., Sharabati, A.A.A., AlSalhi, N.A., and El-Tamimi, H.S., 2019. Lean Six Sigma effect on Jordanian pharmaceutical industry’s performance. International Journal of Lean Six Sigma, 10(1), pp.23-43.
76. Angelis, J., Conti, R., Cooper, C., and Gill, C., 2011. Building a high‐commitment lean culture. Journal of Manufacturing Technology Management, 22(5), pp.569-586.
77. Dorval, M., Jobin, M.H., and Benomar, N., 2019. Lean culture: a comprehensive systematic literature review. International Journal of Productivity and Performance Management, 68(5), pp.920-937.
78. Parast, M.M., 2011. The effect of Six Sigma projects on innovation and firm performance. International Journal of Project Management, 29(1), pp.45-55.
79. Duggan, J., Cormican, K., and McDermott, O., 2023. Lean implementation: analysis of individual-level factors in a biopharmaceutical organisation. International Journal of Lean Six Sigma, 14(2), pp.309-334.
80. Belhadi, A., Kamble, S.S., Zkik, K., Cherrafi, A. and Touriki, F.E., 2020. The integrated effect of Big Data Analytics, Lean Six Sigma and Green Manufacturing on the environmental performance of manufacturing companies: The case of North Africa. Journal of Cleaner Production, 252, p.119903.
81. Ghobakhloo, M. and Hong, T.S., 2014. IT investments and business performance improvement: the mediating role of lean manufacturing implementation. International Journal of Production Research, 52(18), pp.5367-5384.
82. Sarwar, J., Khan, A.A., Khan, A., Hasnain, A., Arafat, S.M., Ali, H.U., Uddin, G.M., Sosnowski, M., and Krzywanski, J., 2022. Impact of stakeholders on Lean Six Sigma project costs and outcomes during implementation in an air-conditioner manufacturing industry. Processes, 10(12), p.2591.
83. Stoiljkovic, V., Milosavljevic, P., Mladenovic, S., Pavlovic, D., and Todorovic, M., 2014. Improving the Efficiency of the Center for Medical Biochemistry, Clinical Center NiS, by Applying Lean Six Sigma Methodology. Journal of Medical Biochemistry, 33(3), p.299.
84. Thakur, V., Akerele, O.A., Brake, N., Wiscombe, M., Broderick, S., Campbell, E., and Randell, E., 2023. Use of a Lean Six Sigma approach to investigate excessive quality control (QC) material use and resulting costs. Clinical Biochemistry, 112, pp.53-60.
85. Widiwati, I.T.B., Liman, S.D. and Nurprihatin, F., 2025. The implementation of Lean Six Sigma approach to minimize waste at a food manufacturing industry. Journal of Engineering Research, 13(2), pp.611-626.
86. Setyabudhi, A.L., Sanusi, and Sipahutar, I., 2019, May. Application Of Six Sigma Methodology To Improve the Product Quality Of Moldings Plastic (Case Study: PT Mega Technology Batam). In IOP Conference Series: Materials Science and Engineering (Vol. 505, No. 1, p. 012067). IOP Publishing.
87. Yamamoto, J., Abraham, D., and Malatestinic, B., 2010. Improving insulin distribution and administration safety using Lean Six Sigma methodologies. Hospital Pharmacy, 45(3), pp.212-224.
88. Daly, A., Teeling, S.P., Ward, M., McNamara, M. and Robinson, C., 2021. The use of Lean Six Sigma for improving availability of and access to emergency department data to facilitate patient flow. International Journal of Environmental Research and Public Health, 18(21), p.11030.
Downloads
Published
Data Availability Statement
NA
Issue
Section
License
Copyright (c) 2026 Attia Gomaa (Author)
This work is licensed under a Creative Commons Attribution 4.0 International License.