How to approach digital transformation
Article originally published by Manufacturing Management on the 13th May 2019.
Written by our Co-Founder & Chair, Neil Svensen.
Intelligent platforms and clever use of technology are nothing new for the manufacturing sector, but an increase in computing power means we can now use them as never before in business, bringing unprecedented benefits to every type of organisation. The inexorable rise of digital technologies – the so-called fourth industrial revolution – has entered a new phase that’s transforming the way we live and work at a profound level.
The manufacturing industry is in a great position to make the most out of the opportunities these emerging technologies open up. Through the combination of new platforms, big data and cloud software, organisations have the means to optimise processes to yield improved productivity, quality and speeds. Indeed, 81% of UK manufacturers say they are ready to invest in new digital technologies. It is estimated that there will be a combined spend of $333 billion on digital transformation solutions in 2018 – nearly 30% of the year’s digital transformation spend worldwide.
From taking care of mundane tasks (so employees can do more human things like looking after customers), to forecasting, quality control, experience design and building supply networks that are efficient and flexible, manufacturing organisations are already using new technologies to take leaps forward in the services and strategies they can offer. We’re looking at the potential to make employees happier and more productive whilst driving amazing new products and services – improving efficiency, minimising costs and increasing scalability.
It’s important to understand this isn’t just about technology as a specialist topic that sits on its own; it’s about how new digital capabilities are revolutionising, quite frankly, everything. What many companies don’t realise is that complete organisational reform is needed, with a new mindset required, not just the adoption of a new system implemented by your IT department.
There’s no getting away from the fact that any such major organisational shift will be disruptive. The benefits of ‘going digital’ are multiple, but the process of actually transforming a company - while simultaneously ensuring ‘business as usual’ for staff, customers and the supply chain - is not without its challenges. A robust strategy will allow organisations to best reap the rewards, while making the process as efficient and straight-forward as possible.
Successful IT transformation requires clear leadership and effective communication of clear and consistent visions based on reasons employees can get behind. To bring people on the IT journey in this way, you need senior level oversight. The C-Suite is where the narrative is set for the rest of the company. If this narrative is scepticism and uncertainty – or even a complete lack of engagement – this will inevitably trickle down.
All employees need to understand the level of change that’s happening and to work collaboratively for these advanced technologies to really show their worth and help manufacturing companies establish closer relationships with customers (identified as the lead reason for offering servitisation in Barclay’s Annual Manufacturing Report).
Strong communication here is critical. When change is coming and people don’t understand it, they can become disengaged, which then creates barriers in implementation. It’s therefore crucial to have total fundamental understanding and engagement from all levels of the organisation. It’s really one of the biggest - and sadly most overlooked - challenges.
But there are ways to tackle it…
Collaborate from the outset
To harness IT in a way that advances your business, your edge and your bottom line, you need to truly involve all aspects of organisation from the very outset. Different divisions don’t like having new technology foisted on them. If it’s been developed in isolation, it might not even be fit for purpose. Collaboration at the start gathers the right inputs into the design process, translating them into a more seamless implementation where everyone knows what’s happening and gets behind the change.
Avoid complicated terminology
Machine learning, intelligent machines, cognitive platforms – these new digital tools use a language that many find confusing or impenetrable. Finding ways to simplify the terminology and underline their value for executive board members will help bring them on board, as well as giving them the tools they need to communicate the changes to their teams across the entire organisation. Glossaries can help everyone get to grips with new jargon at their own pace.
Give real-life examples of technology
One problem for people working in AI is that they focus on the technology rather than the outcome. We need to think about how to turn the technological advances into something that both technical and non-technical people appreciate. You can do this by creating powerful examples that show intelligent technology in action, demystifying it while demonstrating the benefits.
What’s really happening in any digital transformation is a journey where a new process becomes part of your growth as a business - it’s a shift in mindset, ways of working and organisational structure. The ultimate goal is to have company-wide engagement – involving everyone from board level to front-line staff – in your vision as a digital business, with your C-Suite driving it. The manufacturing organisations that will flourish in the future will have a C-suite that ‘thinks digital’ and embraces their role in taking your business into the future.