Abstract
With the rapid development of modern Chinese companies, small-and-medium companies play a more and more critical role. At the same time, the competition among Chinese SMEs is also intensifying. This paper proposes the significance of lean management under current enterprise management through the introduc-tion of lean management, how it affects innovation, and the case analysis of a manufacturing SME. The case analysis includes quality process management and improvement, waste elimination, employee participation, good leadership, and supplier relationship. These measures of lean management give a general under-standing of how the company inspires innovation and further show that LM has a remarkable effect on SMEs, especially in the manufacturing sector.