Modelling the relationship of digital technologies with lean and agile strategies

Abstract

As the world becomes globalised, companies fight for survival by connecting their in-house processes with external suppliers/customers. To remain competitive, companies must integrate innovative capabilities like ‘industry-4.0 technologies’ with their operation and supply chain (SC) strategies. The integration of various strategies has been investigated with the associated effect on performance; however, studies on how industry 4.0 technologies might support integrated strategies are still incipient. This work investigates the hierarchical relationships of ‘industry 4.0 technologies’ with lean and agile strategies. Adopting the ‘Interpretive Structural Modelling (ISM)’ technique to present a model depicting the linkage, the work also classifies the technologies and practices according to their ‘driving’ and ‘dependency’ powers. The findings revealed that the technologies have a high affinity to enable the implementation of lean and agile strategies. Among the nine technologies included in the study, ‘Cyber-Physical-System’, ‘Internet-of-Things’, ‘Cloud-Computing’, and ‘Big-Data-Analytics’ have the highest driving powers, signifying their higher affinity with the practices. Meanwhile, all the practices have a high enough affinity to be influenced by the technologies, except for a few (3/16 of lean and 2/9 of agile) that possess affinities too low to be driven by these technologies. The theoretical and managerial impacts of the research are also emphasised.