Lean and continuous improvement use and success in energy-based utilities

Purpose This paper aims to investigate Lean implementation in the US energy-based utility sector and what the industry’s success factors are. If implemented fully, Lean can potentially improve efficiency and employee relations in organizations of many different types. However, many companies in all industries fail to implement Lean because they do not sufficiently address significant success factors, such as having top management committed to the program. Meanwhile, Lean implementation in Energy-based utilities has very few peer-reviewed studies. Design/methodology/approach A two-step sequential mixed method approach was conducted to understand how Lean is used in energy-based utilities and how it is successfully implemented in the industry. Four US energy-based utilities participated in the study. An online survey was conducted first to gather information with both quantitative and qualitative data from participants. Then, a semi-structured interview followed to discover more information about success factors. The analysis used descriptive statistics to calculate the proportion of how many respondents are using Lean or other continuous improvement programs. Then, eclectic and pattern coding were used to develop success factor themes in this industry. Findings This research found that the majority of the respondents in this study use Lean or other continuous improvement methods, with 87% of the respondents using a continuous improvement program and 53% using Lean or Lean Six Sigma (LSS) in their work group within their organization. It was found that energy-based utilities share common success factors with other industries when implementing Lean and have unique success factors specific to utilities. The top shared success factors include top management support, awareness of the benefits of LSS, training, teamwork, communication, culture, employee empowerment, selection of tools and a supportive organizational structure. Employees’ understanding of the benefits of Lean was cited more frequently in this research than in previous studies outside the utility industry. New success factors related to the lack of control of the weather, regulations, how far the facilities are from each other and variations of demand, processes and energy prices challenge the implementation. Practical implications The results of this study show that Lean and continuous improvement (CI) are used in energy-based utilities, and the success factors for implementing these programs are similar to that of other industries. However, the results also indicate that it is not always fully clear how specific Lean and CI techniques can best be used in energy-based utilities; thus, more published case studies could be helpful to make Lean and CI programs in the industry more successful. Originality/value Few published peer-reviewed papers discuss the use of Lean or other continuous improvement methods and their associated success factors in this industry. This research partially fills that gap. In particular, the study uses data from employees at different levels in energy-based utilities, giving a more in-depth look at the industry’s Lean/CI efforts.