BLOG VIEW: When 17 software developers came together in February 2001 to write the Manifesto for Agile Software Development, it changed the way mission-critical software was built. Yet it still took years for most industries to fully embrace Agile ideas.
Agile is a development philosophy centered on rapid, incremental delivery. It anticipates shifting requirements and encourages teams to break large projects into smaller pieces, deliver quickly, gather feedback, and refine.
Its core strength is adaptability: move fast, learn fast, and adjust as you go. If the destination changes, Agile helps teams course correct. Today, nearly everyone building software for the mortgage industry claims to be Agile. Daily stand-ups, sprints, and retrospectives are now table stakes.
And yet, after 20 years in the industry working with teams around the world, there is a question as to whether Agile is delivering everything the industry thought it would. It’s becoming clear that the industry is missing the next leap forward.
Agile helps teams move quickly, but speed alone doesn’t guarantee excellence. What mortgage technology needs now is Lean along with Agile; the discipline of manufacturing applied to the way we build software.
Lean Manufacturing is built on eliminating waste and embedding quality into the process from the start. Its goal is efficiency and consistency: do only what adds value, do it right the first time, and continually improve the system. While Agile accepts some rework as part of learning, Lean treats rework also as waste and designs processes to avoid it.
Lean’s origins trace back to post–World War II Japan, where Toyota leaders such as Taiichi Ohno and Eiji Toyoda set out to build cars with limited resources. They developed what became the Toyota Production System (TPS), a philosophy emphasizing flow, quality at the source, and constant refinement. Instead of mass production, Toyota focused on precise production and making what was needed, when it was needed, with minimal waste.
This approach produced extraordinary gains in quality and efficiency, prompting global interest. By the 1980s and 1990s, American manufacturers and management experts studied and codified the system, popularizing the term “Lean.” Today, Lean reshapes industries from healthcare to logistics and increasingly influences software development. Mortgage technology should be next. Our industry needs its Toyota moment.
Quality First: Deliver It Right the First Time
In practice, Agile and Lean can complement each other. Agile helps teams respond to evolving business needs. Lean ensures that what gets delivered is reliable, efficient, and built with minimal friction.
Developers must begin demanding the same rigor from software production that transformed automotive manufacturing. We can still deliver quickly—but with the added confidence that high-quality systems will work the first time.
Our industry has normalized bugs, rework, and post-launch cleanup. The issues may be small, but if Toyota built cars the way many of us build software, we’d read about recalls every day.
Lean begins with an uncompromising truth: quality is non-negotiable.
Manufacturers don’t release cars that “should work well enough.” They design, test, and build for reliability from Day One. Mortgage technology, by contrast, often treats go-live as “the real QA phase.”
That leads to downstream issues: implementation fatigue, service tickets, and frustrated users improvising workarounds for problems that should have been caught upstream.
When quality becomes the priority, not an afterthought, organizations stop absorbing the hidden costs of failures: wasted time, damaged reputations, and lost customers.
Quality can no longer be the last step in our process. It must be part of the foundation. If it’s not right at the beginning, every step that follows becomes more expensive.
Waste Elimination: Stop Requiring the Rework
In manufacturing, waste is the sworn enemy. Anything that doesn’t create customer value is identified and removed, whether excess inventory, needless motion, overproduction, or defects.
Software development experiences the same inefficiencies.
Teams routinely invest in features that go unused, retrace their steps because requirements were unclear, and lose momentum through long handoffs and meetings without decisions. Communication gaps stretch timelines and introduce errors that surface only after release.
Lean exposes all of this for what it is: waste. The discipline demands that developers root it out.
Lean culture teaches teams to call out waste early and repeatedly, not to place blame, but to preserve efficiency and focus. When teams learn to see waste, they can stop it before it spreads.
Continuous Improvement: The Kaizen Mindset
Lean isn’t a project; it’s a habit. Manufacturers call it kaizen: a commitment to small, ongoing improvements that appear everywhere, from the assembly line to code reviews.
Software teams need that same mindset.
Quality must accumulate over time. In practice, this means refining code to make it cleaner and more efficient, reducing unnecessary complexity, improving documentation so knowledge is shared, elevating skills through ongoing learning, and streamlining workflows to eliminate friction.
In a Lean environment, a defect isn’t simply patched and passed along. It is examined closely. Teams ask why it happened and what must change to prevent it from happening again.
When continuous improvement becomes muscle memory, quality rises, and delivery accelerates. Teams spend less time fixing recurring issues and more time creating new value.
Cross-Functional Collaboration: Tear Down the Walls
Lean reshaped automotive manufacturing by breaking down silos between design, engineering, and production. Designers didn’t only sketch; they walked the floor. Engineers didn’t only run models; they built.
The same principle applies to mortgage technology.
Teams work best when developers, analysts, and testers share accountability, not just tasks, and when customers, not just product owners, engage early and often.
Too often, technology teams build in isolation. Lean forces collaboration. When everyone owns the outcome, quality follows.
Cross-functional teams shorten feedback loops. When the people who write the code sit close to the people who test it and regularly engage with the people who will use it, requirements sharpen, defects surface sooner, and delivery becomes cleaner.
How Mortgage Tech Teams Can Start Now
None of this requires a full-scale transformation on Day One. Practical steps can start immediately:
Shift quality to the left: Test early and often, before code reaches production. AI is making comprehensive testing more efficient, eliminating excuses for not validating 100% of output.
Measure waste: Software rarely tracks rework as manufacturing does, but it should. Count unused features and post-release fixes. What gets measured gets managed.
Shorten feedback loops: Put developers, analysts, and testers at the same table, and bring customers into the process whenever possible. Our experience with various Credit Unions shows the advantages of moving lenders and developers closer during development.
Simplify workflows: Reduce handoffs and approvals that slow momentum. Years of working with global software teams have proven that simplified workflows lead to faster, better outcomes.
Empower product owners to inspect constantly: Hold frequent, focused improvement sessions beyond basic sprint retros.
Lean succeeds not through new tools but through a new way of thinking: work simply, collaborate deeply, and never stop improving.
The mortgage industry has spent decades fighting the same battles: expensive implementations, difficult upgrades, lingering defects, and frustrated users. Agile certainly helped, but it’s no longer enough.
Lean is not a replacement. It’s the next evolution.
If lenders want reliable technology that truly supports the way they work, they must expect more from the teams who build it. They must demand quality first, eliminate waste, commit to continuous improvement, and dismantle silos for good.
It’s time to build mortgage software the way the best manufacturers build cars – precisely, consistently, and with pride.
Lokesh Chandra Pathak, CIO of Mortgage Cadence, has more than 27 years of experience in engineering, product development, and IT strategy.