August 18, 2016
Digital technologies are changing the face of manufacturing. The sweeping changes are often accelerating faster than companies can craft transformation policies and job profiles. Many manufacturers are still at the starting point, struggling to build their digitalization strategy. They even question who on the team should drive the initiative, and what skills personnel will need in order to design and follow through with modern digitalization concepts.
These are important questions that need to be addressed early in the planning stages of any digital initiatives, whether isolated proof-of-concept tactics or wholesale re-engineering of the entire manufacturing value chain. The makeup of the team will play a key role in success—or disappointment—around your digital transformation.
Here’s some advice for inviting personnel on the roller coaster ride of digital transformation and preparing them for what is ahead.
Starting at the beginning
CIO.com describes digital transformation as “the acceleration of business activities, processes, competencies, and models to fully leverage the changes and opportunities of digital technologies and their impact in a strategic and prioritized way.” That definition may seem vague and full of broad terms that are difficult to firmly grasp. This is one of the challenges around digitalization; the concepts aren’t simply defined and deployed. In these early stages of transformation, best practices are yet to be identified, use-cases are limited, and most experts writing about the topic are projecting assumptions, not reporting on hard evidence. A leap of faith is required.
From the vast volumes being generated on the topic, though, the evidence points to radical changes on the horizon—and bringing positive benefits to the companies that are ready to seize the opportunities.
Here are three examples analyst firm McKinsey & Co. cites to illustrate the wide scope of digitalization in manufacturing:
- Boeing developed its two most recent airframes, for the 777 and 787, using all-virtual design, reducing time to market by more than 50 percent.
- At innovative fashion retailer Zara, 10 staff members can now update a store’s inventory in a couple of hours, work that used to take 40 employees more than 5 hours.
- Pharmaceutical manufacturers use continuous manufacturing suites, less than half the size of traditional factories, and even use portable factories built in 40-foot trailers.
Industry and academic leaders agree that digital-manufacturing technologies will transform every link in the manufacturing value chain. That includes a wide range of jobs, from research and development to the supply chain, factory operations, marketing, sales, and service. People at all levels in the organization and beyond the four walls will have new levels of connectivity, a voice, access to data, and the opportunity to engage and contribute in meaningful ways. Data may be the “fuel that makes the bus run” in digitalization, but the people are the drivers.
How personnel are affected
Unlike some other performance-based programs, one committee can be created to manage the company’s entire digital transformation. An energized, company-wide mindset that embraces change must come from the top. The CEO, CFO, CIO, and COO must collaborate to allocate resources and deploy new concepts in a strategic—not haphazard—fashion. The operational line of business managers must also take responsibility for updating tactics. The ripples will be felt throughout the company, with personnel in all departments being affected by data availability, automation, and new customer-centric policies. No one will be able to sit back and wait for the transformation to happen around them. Action, strategic as well as tactical, will be required at all levels in the plant:
- C-suite execs must find the budget, set strategy, empower leaders, and ignite enthusiasm for change and innovation.
- Plant managers must make sure the big ideas are doable, profitable, align with regulations, and answer customer needs.
- Department heads must turn concepts into action, train personnel, refine processes, recruit partners, and celebrate success.
Are you ready?
Although digitalization is a technology issue at its core, the IT staff alone cannot bear the burden. In fact, an IT background may not even be critical for the leadership team. In a survey recently conducted by Deloitte and MIT Sloan Management Review, individuals were asked to name the most important skill for leaders needed to succeed in a digital environment. Only 18% of respondents listed technological skills as most important.
Instead, they highlighted managerial attributes such as having a transformative vision (22%), being a forward thinker (20%), having a change-oriented mindset (18%), or other leadership and collaborative skills (22%).
Creative thinking is becoming more important in many manufacturing settings, where innovation and efficient problem-solving are key competitive differentiators. This is even leading to a growing STEAM movement, which advocates adding art to the traditional STEM stack of science, technology, engineering, and math skills being taught in schools. New jobs are emerging in manufacturing that require both technology and liberal arts backgrounds, such as a user-experience designer, who may be tasked with designing dashboards, writing training manuals, and planning how customers will access product-related information.
Deloitte reports that the list of digital business roles and functions is extensive and growing. “There are now digital strategists, chief digital officers, digital engagement managers, digital finance managers, digital marketing managers, and digital supply chain managers, among other positions.”
Despite the evolving emphasis, many managers are expressing concern over personnel readiness. A survey conducted by Accenture indicates that 88% of manufacturing executives say they are unprepared for the coming disruption to current operating models.
Now is the time to address these issues and build a team that can help your organization start the journey toward digitalization with logic and creativity. The early planning stages are often the most important steps of the project, the ones that set the tone, pace, and expectations. Be sure you launch your digital endeavor with the right team in place, the team with a wide range of skills, especially the ability to envision a new era in manufacturing.