Development of Product and Process Innovation through the Integration of Lean Methodologies, Advanced Digitalization, and Sustainability

This research investigates the integration of three key paradigms—Lean Manufacturing (LM), advanced digitalization with a focus on Artificial Intelligence (AI), and social sustainability—within small and medium-sized enterprises (SMEs). It aims to advance interdisciplinary understanding and provide empirically grounded insights for managers and policymakers on how such integration fosters responsible, inclusive, and resilient innovation. Although LM, digitalization, and sustainability have been studied separately, their synergistic potential remains underexplored, particularly in SMEs, which possess unique agility and human-centered capacities. Adopting a multi-level interpretive approach, the study addresses three gaps: (i) a systemic gap in understanding interactions among LM, Industry 4.0, and social sustainability; (ii) an operational gap regarding how AI-enabled tools support Lean transformations while preserving inclusivity and well-being; and (iii) a strategic gap on AI’s influence on SMEs’ international decision-making and competitiveness. The thesis comprises five chapters, including three empirical studies at systemic, operational, and strategic levels. Chapter I establishes the theoretical and methodological framework. Chapter II, through a systematic literature review of 43 publications, develops a conceptual framework illustrating how LM–digital integration reinforces human-centered values and social sustainability. Chapter III, based on a case study of an Italian SME, shows that AI-driven training can democratize knowledge but also creates tensions related to skills, monitoring, and digital anxiety, emphasizing participatory and transparent implementation. Chapter IV, using multiple cases of Italian SMEs, finds that AI enhances foresight and strategic agility when aligned with ethical and human-centered principles. Chapter V synthesizes findings, demonstrating that meaningful SME innovation arises from aligning Lean principles, digitalization, and social sustainability. The thesis advances theory by (1) redefining LM–Industry 4.0 convergence as a socio-technical, ethically grounded system; (2) embedding social sustainability into industrial resilience; (3) framing SME innovation as multi-level and emergent; (4) positioning SMEs as adaptive, human-centered innovation agents; and (5) conceptualizing AI as a socio-organizational phenomenon. Methodologically, it contributes a multi-level qualitative design integrating literature review and case studies. Managerially, it offers a roadmap for responsible innovation, proposing strategies for participatory AI integration, inclusion metrics, and human-centered decision tools. Overall, the research develops an integrated model of human-centered innovation, showing how SMEs can achieve technologically advanced, socially inclusive, and ethically responsible industrial transformation.