Digital Muda - The New Form of Waste by Industry 4.0

Lean management is an approach where value is created through the reduction of waste. Eight forms of waste were identified by the Toyota Company as worth considering while managing an efficient production process: overproduction, waiting, transport, over processing, inventory, movement, defects, and unused creativity. Modern manufacturing plants are being transformed by Industry 4.0, the fourth industrial revolution, which promotes a wide variety of technological solutions to increase innovativeness and competitive advantages. Technological solutions are created on the basis of data that must be analyzed to enable manufacturers to be more strategic in the decision-making process and generate new profit channels through data analytics. A conceptual framework was developed to investigate if the inefficient usage of data has a negative impact on manufacturing performance through the decision-making process. Semi-structured interviews were conducted in two leading manufacturing companies in Sweden that are following lean principles. A new form of waste, digital waste, was defined. This paper suggests considering digital waste as a new type of muda (waste), which is its theoretical contribution. From a practical perspective, the results of the paper encourage practitioners to pay extra attention to data analytics, work on the reduction of digital waste and establish new revenue channels based on data analysis.