Why the digital transformation is not really a technical challenge anymore
Working for one of the biggest one-stop shops for IoT solutions in the world I’ve seen great projects and successes being put in place, but also a lot of them fail or take for ages before a true return on investment is made. Interesting thing is that the main challenges in all these projects are roughly the same.
One of the things I like to state is that the ‘technical challenge’ is not your biggest hurdle at all. If you can think of a solution you would like, you can find people that can build it for you. A bigger challenge is our ability (individually and with a company) to adapt to the impact the digital transformation has.
I would like to share a couple of lessons learned I have seen in the past couple of years which could help you avoid the pitfalls others had to encounter. To set the scene I will be talking mainly about projects with industrial customers which I have seen working towards their digital horizon.
Let me first start with the fact that we all are going to go through this transition within the next couple years, there is no question about it and if you are not doing it your competition will do so and will outrun you within a shorter time frame you can Imagine. So you want to invest in new technologies to make sure you keep in business.
If you are not convinced I will give a short example to ‘tickle’ the mind.
Imagine you and your competitor build machines, these machines are custom-made, one of a kind and in a specific niche market. Your competitor design’s and builds them for a customer and their R&D is leading the design since they have the best (technical) knowledge of the needs the customer has. The machine is built without a way to connect to some form of cloud and there are no real smart devices used.
The customer buys it from your competitor and starts operating it. After half a year someone from the competitor is visiting the customer (sales or service) and asks the customer how the machine is performing. His response is something like: I’m happy with the machine! It performs most of the times as expected, you have improved the design from the last machine we had so that is nice. There are some features that we do not use though and we have noticed that there is a different output when we have different operators in charge. The conversation will go on and depending on the skill set of your employee some tips and tricks will be shared. After that, your employee will drive back with this information, delivers it to R&D with the results that improvements are investigated and the next machines will be better. Also, it could be that training will be provided to the customer to get more out of all features the machine has to offer.
You decided to invest in some smart devices and some analytics tools for the machines you bring to the market. This enables you to get data to your office and do some analytics. After half a year your employee visits the customer with the following story: Dear customer, you are now operating one of our machines for a half year and we noticed that you do not use the full potential of what we have designed for you, can I give your operators some tips/tricks that will help them get more out of our machine?
Next to that, you are able to see (every day) that the actual use of the machine does not exactly match with the operational profile your R&D had in mind designing it. Now you are learning every day how to design a better machine. Imagine the head start you will have on your competitor within half a year…..
Now you are a machine builder that delivers 10 of the same machines to 10 different customers. Equipped with smart devices and the ability to connect remotely so data can be analyzed elsewhere.
- You are now able to give at least 9 of your customer’s support on getting more out of their purchased asset. (possibly your customer is willing to pay for this service)
- You will learn 10 times as fast as you used to do
This is one example of the power digitization could bring to your operation. Now, do you want to start your journey?
6 lessons learned:
1 Technology will not be your biggest challenge
If you have a slight idea on where the quickest ROI will be, you need to define which technology to choose to get with your ‘bold Idea’ the business case you want to show your management. Please be aware that technology will not be the issue.
Yes, there are lots and lots of technology’s hitting the market on an even faster pace you can develop a decent proof of concept. Augmented/virtual reality, Big data, machine learning, AI, drones, blockchain, digital twins, and these days you are even able to combine multiple to reach your goal.
You will be able to build what you need but make sure you keep the following lessons in mind.
2 Think big!!!!! But start small
Looking at the potential, you are allowed to dream of all the nice things you can build and all the value you will create. Build air castles and think with your growth mindset on all the positives the future will bring. Done that? Great, that will be the destination of your journey and you will use it to motivate your team during the frustrating period you are about to face.
Now start small!!
Please pick one machine, one line, one small object you like to start with and work your way to whatever you had imagined before. There are loads of company’s burning triple their R&D budget on developing extensive functional specifications and adding new possibilities/requirements to their Wishlist without actually developing something. You will find yourself hunting the pot of gold you will find at the rainbow. Truth is the pot will move just as fast as you walk to get there. By starting small on something that you can actually see you will learn and develop something that is actually bringing value. Instead of dreaming of the one system that brings you everything you dream of.
3 Search for data
Roughly 10% of the data we produce is actually used (for something). This means that a huge part of the information you need for your first(small) application is already there and only needs to be found. Make the unconnected connected. Often assets have their own analytics already installed. Make sure your supplier grand’s you excess to what is important for your operation. If he does not want that, make sure you start to talk to others that will be ‘open’.
If you are investing in your assets make sure to invest that little extra for a ‘smart device’ instead of a cheap alternative that is not able to give you anything. Most of the hardware will be there for the next twenty years and within the next five, you wish to have the data available you could have bought earlier. If you start investigating your new purchases ask your supplier what value this purchase can bring to your process. I’ve learned that the average sales you deal with are not telling you this unless it is being asked.
4 If devices start to talk so should your people
Doing these projects right will have an impact from the shop floor till the top floor. It will impact the way people work, the way they interact and the dependency they have on each other.
Next to that, we see that these initiatives often kick-off at multiple departments within the same company. It is needless to say, that this costs time, money and is a waste of knowledge. This being bundled will make you move faster and more efficient.
5 the right team
Point four brings me to point five and that is to search for the right people to drive this. Often these journeys are started by one or two enthusiasts that see the potential. This is great, to begin with, but this is not a one man’s job. Assembling the right team will make ore break the success you have in mind. You need someone who can dream and tell stories. One that can build a plan and more or less stick with that. One that knows the operation you are trying to enhance. Last but not least is that you need support from your management. Without support and a sort of vision in the management team, you are significantly less likely to build a successful application. It is likely that not all competencies are currently in-house. Do not be hesitant to work together with your suppliers to find what you need. They have probably seen the things you want to achieve being implemented somewhere else so why not use that knowledge?
6 be agile
Though you set off with a clear (small) goal in mind it is possible that along the way you find other information that brings faster and other values. It happens that ones the journey is set (and investments are made) it is difficult to change headings. If you find a more suitable application that brings a faster ROI of more value do not be scared to change course and head for another direction. But keep point two in mind and do not end up changing course all the time and not reach any success at all.
Hopefully, you will be able to learn from the ones that started this journey before you. Since we are all going to start sooner or later.
My advice: make sure you become the one that sets the course instead of the one that adapts to what the competitor is doing.