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What’s the Way Forward to Achieve Digital Transformation?

What’s the Way Forward to Achieve Digital Transformation?


Aug 18, 2017
Manufacturing and Distribution

Achieving Digital Transformation 

The final blog post in our series about Digital Transformation helps you see the need for a strategy and some of the basics involved in developing it.

If you’ve read our recent posts discussing digital technology and its ability to transform organizations, you know that most leaders in the industry see it as nothing short of a revolution, with the potential to reinvigorate manufacturing in this country. If you’ve determined that there may be practical ways for you to implement digital tools to help your discrete manufacturing organization grow, then you’re probably wondering, “So, what do I do next?”

Transforming how you operate (and in many cases the products you make) takes equal parts commitment and discipline, and it starts with developing a smart strategy. Moving from the traditional ways you’ve run your company to what’s new and unknown isn’t easy, and certainly not something to undertake with only marginal commitment—to realize the benefits of digital, you must be “all in.” If you think you’re ready to take your company to the next level with a digital transformation, use this overview of the steps you’ll take on your journey from traditional to digital.

Identify Where and What
The first step in undergoing transformation will be to identify the areas within your organization that most need improvement—and that have the greatest potential to impact growth and profitability. Different technologies require different levels of investment, and a business consultant can help you understand the value of each by weighing the potential for improvements—to quality, capacity, productivity, and others—against the investment required to adopt them.  

From past posts on this topic, you know that technology can be used to improve the efficiency and profitability of your internal operations, and it can also be used after the sale to monitor your product’s performance in use. Improving internal operations is a matter of monitoring equipment performance, product quality, and labor usage to improve in areas like maintenance costs and downtime; after-sale product performance is monitored using sensors connected back to your systems, providing data that helps you predict maintenance needs and inform future product improvements. In most cases, a business consultant will recommend that you focus first on internal operations, and then expand your efforts to include after-market opportunities.

Anticipate How Workers Will Be Affected
Once you know where you’ll focus efforts to transform from traditional to digitally enabled, you need to understand how the process—and the tools involved—will affect your workers. Be prepared to address cultural “unrest” precipitated by the new technology with a thoughtful change management plan. A well-developed plan that explains, trains, and helps people embrace new processes and procedures will minimize the hurdles inherent in organization-wide change. 

Get the Right Talent on Board
The very nature of a digitally enabled organization requires special skill sets, some on the part of your current workforce and some you’ll need to bring on board to make the transformation (and ongoing operations) run smoothly. With more and more organizations taking advantage of digital technologies like 3D printing and robotics, hiring the right people will continue to foster a “seller’s market,” with competition for talent driving up salaries of those whose job it is to keep systems working at peak performance.

Set Up Strict Protocols
Without clear, enforced operational standards and protocols, a digital transformation can go awry—quickly. Unfortunately for manufacturers taking their first steps into the digital world, there’s relatively little in the way of best practices to rely on because even enterprise-level manufacturers are just beginning to evaluate the success of their own standards and protocols. That puts the onus on each manufacturer to develop processes and the means to ensure that they’re observed.

Invest in Security
Each sensor and device is a potential point of vulnerability, so as you invest in technology you also must invest in associated security. Undoubtedly, your back-office operations are protected by at least a modest level of security designed to mitigate risks of hacking and data loss. When you connect digital tools like sensors to multiple areas within the facility, you need to put more (and more sophisticated) measures in place to secure the data being generated. 

It may seem counterintuitive to invest in emerging and new technologies as the manufacturing industry as a whole is growing slowly—but it’s exactly the right time because the need to establish value that exceeds that of your competitors has never been greater. How you respond to market conditions will determine how you’ll fare, with those who see the potential of digitalization to improve processes and products reaping the greatest rewards. And in the future, those who’ve jumped on board will be looking at those who didn’t in their rearview mirrors.

 

Author(s)

Suzanne Koss
Suzanne Koss, CPIM
Partner
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