Operations Strategy for Lean and Sustainable Systems

In the present era of globalisation and circular economy, sustainable development is considered a universal goal for every business organisation. For being sustainable, organisations need to improve their performance in terms of economic, social and environmental measures. Maintaining balance among these measures is a big challenge for most of the organisations today. Despite this tension, some organisations such as 3M, Walmart, GE, IBM, the Hyatt Regency, and Scandic hotels, among others, have been able to turn their environmental concerns into a competitive edge. While these organisations have overcome this traditional trade-off, there is no shared understanding nor strategic guidance on how to achieve sustainable and cost-effective business operations without compromising productivity, the quality of goods and/or services, and the environment. Furthermore, if we consider the three dimensions of sustainability, where social responsibility is added to economic and environmental concerns, a holistic analysis approach seems to be missing. Embracing the three dimensions of sustainability into the upstream process pipelines and in initiatives to continuously improve operations requires a deep understanding of key internal interactions within the company and key external interactions across the value chain. This understanding, however, still appears to be at a stage of infancy. On the one side, limited perspectives for sustainable development have been considered, on the other, recent studies still identify the prevailing need to enhance our understanding of the link between sustainability, lean and performance. 

Among the operational improvement initiatives that seem to have an explicit connection to sustainability are those based on lean thinking. Fortunately, the existence of lean has offered a way to sustain operations. In lean, a company focuses on producing high quality products in the most efficient and economical way while incorporating less human effort, less inventory, less time to develop products, and less space and yet highly responsive to customer demands. Elimination of material waste directly meets the sustainability objectives. By cutting down unnecessary wastes in all resources, organisations will have more reserves of these resources to be used in the future prolonging sustainability. There are also several real cases of organisations that have embraced lean methods in order to maintain competitiveness in the global market. Companies such as Honda and Toyota have successfully sustained their operations through the lean approach.