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The textile industry contributes 2 and 3% to the global and Indian Gross Domestic Product (GDP), respectively. India supplies a quarter of global cotton yarn. Yet, most yarn manufacturing companies use outdated methods and lack organisational skills and strategies. Improvement in processes in India could significantly help the industry worldwide.

The variables that influence the performance of the system were identified. Their interrelationships and impact were identified from the employees in the chosen case study, a yarn manufacturing industry. A System Dynamics (SD) approach was employed to study the benefits of implementing 5S lean strategies. The impact of each variable on various performance measures such as throughput, Work In Progress, processing time, waiting time, idle time, over-processing and scraps was analysed.

Improvement in outcomes reflected an enhanced adoption of leanness in the industry. The decision-makers can utilise this study to optimise the necessary parameters in the system and attain the desired productivity levels. Better resource management and reduced processing time helped increase the despatch rate by 9.735% and decrease the WIP by 23.01%. Time management helped to reduce the inventory, idle time and waiting time. Over-processing, defects and scraps were minimised, indicating a shift towards lean.

This study pioneers the use of SD simulation models for optimising yarn manufacturing using lean strategies. Improvement in performance measures by integrating these strategies opens avenues for future research using multiple approaches to address a problem.

Implementing 5S lean principles and simulations enhances productivity, reduces waste and optimises resource management for the yarn manufacturing industry. Decision-makers can employ simulation to witness the outcomes of their changes without investing cost and time and without associated implementation risks.

The use of a simulation model to witness the benefits of incorporating lean strategies in yarn production has not been explored. This approach could help the managers and policymakers understand their existing system's shortcomings and critical areas that require improvement.