Digital technology a potential for sustainability

Digital transformation in industry has the potential of improving efficiency and productivity as well as social, economic and ecological sustainability. However, digitalisation and sustainability tend to be treated as two separated issues. A new thesis in product innovation by Hossein Rahnama explores how these two areas can be integrated within manufacturing companies.

The research shows that digital transformation and sustainability can strengthen each other; a process known as the twin transition. For example, sensors can be used to monitor equipment wear and tear, collecting data that enables predictive maintenance. This helps extend the lifespan of equipment, reducing waste and resource consumption.

“My literature studies show that there is a lack of a strategic framework explaining how manufacturing companies can use digital technologies to integrate environmental, social, and economic sustainability goals,” says Hossein Rahnama.”

The thesis focuses on collaboration within the manufacturing value chain, particularly between technology solution providers (TSPs) and manufacturing companies. Such collaboration can help overcome both internal and external sustainability challenges, while enabling the co-creation of tailor-made technology solutions for sustainable production.

Co-creation of value

In one case study conducted in southern Sweden, 15 interviews were carried out with employees from TSPs. The results show that TSPs and manufacturing companies can co-create value for improving sustainability through digital technologies can also enhance energy efficiency, recyclability, and innovation, thereby boosting competitiveness.

However, collaboration requires data sharing, which has traditionally been limited due to concerns about trade secrets. Other challenges include organisational resistance, lack of digital skills, and limited customer demand for sustainable solutions.

In another study, 15 participants from manufacturing companies and TSPs within an automation cluster were interviewed about the challenges of digital transformation and sustainability.

Financial pressures

“The interviews show that the main challenges these companies face are financial pressures from high investment costs and uncertain returns, resistance to organisational change, low supplier commitment, and limited customer demand for sustainable solutions. This is partly due to external factors such as complex regulations, a lack of financial incentives, and unpredictable events. There is also a general reluctance to share data, especially through cloud-based platforms,” says Hossein Rahnama.”

Drawing on both the literature review and the interview findings, Hossein Rahnama developed a strategic sustainability framework based on the ISO 14001 PDCA model (Plan–Do–Check–Act), a globally recognised environmental management system.

This sustainability framework provides a step-by-step tool for integrating key sustainability practices, offering a structured approach to governance, strategy, operations, monitoring, and continuous improvement. It also illustrates how various digital technologies can be applied at different stages of the process.

Concentration on the "Do" phase

The research highlights that most existing technologies are concentrated in the “Do” phase, which focuses on operational activities such as real-time monitoring, predictive maintenance, and automated process optimisation.

However, manufacturing companies could create even greater value by expanding the use of digital technologies in the “Plan” phase, using advanced analytics and simulation tools to support better decision-making. Strengthening the “Check” phase, which deals with sustainability reporting and carbon footprint management, could also improve transparency and compliance with environmental regulations.

“A general finding in my thesis is the critical role that technology solution providers can play in enabling manufacturing companies to develop twin transition strategies,” concludes Hossein Rahnama.