Lean First, Tech Second: The Smart Route to Operational Excellence

Digital technologies are fundamentally reshaping how companies operate, from manufacturing floors to customer service desks, as businesses across industries embrace the Internet of Things, cloud computing, big data and artificial intelligence (AI) to streamline operations and unlock new sources of revenue.

However, in the rush to adopt digital technologies, companies that prioritise technology alone risk missing a fundamental truth—digitalisation succeeds only when built upon a foundation of lean principles.

Our research, published in the International Journal of Production Economics, shows that integrating lean practices with digitalisation leads to a robust learning environment, which ultimately drives overall operational performance. In my other related article published in Rotman Management, I answer the contraposition, “In the Era of Digital Everything, Is Lean Still Relevant?”

Many firms invest heavily in digital tools, expecting immediate gains in efficiency. Yet, our study found that digitalisation alone does not inherently improve learning or operational outcomes. While digitalisation provides decision-supporting intelligence by connecting data with processes, lean principles foster a structured learning culture that enhances efficiency over time. When combined, these methodologies create a powerful synergy that enables firms to sustain improvements in the long run.

Research highlights that digitalisation’s emergent intelligence leads to a decision-supporting learning system, which helps combine resources and share capabilities. On the other hand, lean, as a continuous improvement method, fosters a human-centred learning system, as proven through numerous case studies and empirical research. 

The synergy between lean and digitalisation 

Both lean and digitalisation contribute to learning in firms, but their impact on organisational learning systems through the workforce is distinct. Lean’s incremental approach, grounded in social and technical practices, contrasts with digitalisation's emphasis on leveraging emergent technologies to create cyber-physical systems.

Understanding how lean practices and digitalisation impact learning in organisations is essential. This is particularly relevant as many firms that traditionally relied on lean practices are now investing in digitalisation.