Lean manufacturing principles as a driver for digital transformation: Adoption insights and performance outcomes in Turkish SMEs

Abstract

Manufacturing companies have started to embrace Digital Transformation (DT) technologies to stay competitive and enhance their operational performance. However, the real industry implementation of DT technologies has proven challenging, particularly for small and medium-sized enterprises (SMEs) that face unique obstacles, especially within developing countries like Turkey. To improve the success rate, recent studies have been investigating the role of Lean Manufacturing (LM) principles to aid the adoption of DT technologies. Despite this interest, research on how LM principles can support DT adoption remains limited, particularly for SMEs. While larger corporations with greater resources are more frequently studied, SMEs often fall behind in DT adoption. Addressing this gap, this study examines how LM principles can aid Turkish manufacturing SMEs in adopting DT technologies, with the goal of improving their operational performance. The theoretical lens of this research is institutional theory supported with contingency theory, to provide a more comprehensive understanding of DT technology adoption within SMEs in a developing country. While institutional theory offers valuable insights as one of the primary theoretical lenses of DT, existing research indicates that it often overlooks the specific challenges SMEs encounter in dynamic and diverse environments like manufacturing. To address this limitation, contingency theory is incorporated into the framework. As a result, the theoretical model is based on institutional theory, reinforced by contingency theory, to examine the impact of LM principles on the adoption of DT technologies in Turkish SMEs, with the goal of enhancing operational performance. Developing and validating this theoretical framework not only deepens the understanding of DT adoption in SMEs but also expands the institutional theory by establishing a robust model tailored to a more complex environment with specific needs and challenges of SMEs in developing countries. To accomplish the research objectives, this study adopted a quantitative research approach. A questionnaire survey was administered, with responses collected from 208 participants representing Turkish SMEs. Following data collection, quantitative analysis was conducted using Structural Equation Modelling (SEM) with IBM SPSS and AMOS software. The SEM analysis results indicate that LM principles positively influence the adoption of DT technologies within Turkish SMEs, providing insights into the specific LM principles that drive this impact. Additionally, the analysis revealed that institutional pressures, specifically mimetic, coercive, and normative pressures arising from competitors, government regulations, and industry further supported DT adoption in Turkey. The findings also provide evidence that DT technologies contribute to improved operational performance within Turkish SMEs. This research offers empirical evidence that LM principles support DT technology adoption in Turkish SMEs, providing valuable insights into how LM principles can contribute to DT adoption processes. From a theoretical perspective, the study extends the institutional theory framework by adapting it to more complex environments through the integration of contingency theory. Additionally, the findings provide practical guidance for managers on aligning their strategies to facilitate DT adoption and inform policymakers on the effects of creating supportive policies that enhance DT adoption among SMEs.