(Technology Forecasters: Alameda, California) -- It seems everyone is trimming down these days. A soon-to-be-published study conducted by Technology Forecasters Inc. and Electronics Supply & Manufacturing, revealed a wealth of insight on the state of lean in electronics. Among the most significant findings were the popularity of lean practices, particularly among contract manufacturers, and the strong correlation between the adoption of lean practices and financial performance.

In all, 75 percent of the 250 electronics-manufacturing managers surveyed said their companies are engaged in lean implementation. The greatest emphasis is on improved efficiency and processes, removing waste, reducing production costs and improving material flows in the factory.

While lean is still predominantly a manufacturing phenomenon, the study found that companies are starting to drive lean practices across the supply chain, working with both customers and suppliers on joint lean implementations.

More than 50 percent of respondents said they were applying lean principles to supply chain processes. When asked about progress of these implementations, however, the results were modest, perhaps because many of these implementations are still nascent. The expectation, however, is that given more time significant reductions in waste and cost savings are possible.

Lean encompasses a broad set of philosophies, tools and techniques for streamlining business processes. Lean can trace its origins to large repetitive manufacturing actions in the automotive sector, in particular Toyota’s Production System, but the principles can be applied to any business processes in almost any industry.

The study found that lean has a positive financial impact. Indeed, three quarters of the companies with advanced lean programs had net profit margins greater than 5 percent, compared to 28 percent of nonadopters.

Nonadopters accounted for the highest percent of companies with net profits less than 1 percent. As for the return on their lean investments, more than 50 percent of managers reported a return on investment greater than 10 percent.

The Web-based survey was conducted in January and February and included electronics original equipment manufacturers, electronic manufacturing service providers, contract electronics design firms, original design manufacturers, distributors and component manufacturers.

This article was originally published in Electronics Supply & Manufacturing.

For more information, visit http://www.my-esm.com/digest/showArticle.jhtml?articleID=198700644

The complete study, entitled “The State of Lean Adoption in the Electronics Industry,” written by Kathleen Geraghty and Hitech Attri, was presented at Technology Forecasters Inc. Quarterly Forum in Monterrey, Mexico, in March. For information on this and other TFI studies, please email the author at brayner@techforecasters.com.