The assimilation of digital technologies in manufacturing promises to transform both the capabilities and performance of daily production operations. Powerful data platforms, advanced analytics tools, AI technologies, and augmented reality solutions are rapidly becoming less expensive, more capable, and easier to use.
However, one often hears senior manufacturing executives saying, “I understand the potential of digitalizing our operations, but we’re not ready”. Sometimes this is due to other initiatives or major projects currently underway, such as a new product line launch, a factory expansion, or a major IT system upgrade. In other cases, “not being ready” could simply mean that the necessary up-front planning and preparation work for launching a digital manufacturing initiative has not yet been done.
Experience shows that “readiness” is a strong predictor of success in digital manufacturing projects. The most successful are those which are well prepared; they are purposeful, focused, practical, and aligned. They have the required resources and skills, at the right time. As expected, these programs have a high success rate, frequently becoming industry benchmarks for digital transformation.
Other manufacturers sometimes invest in digital solutions with surprisingly little preparation. These projects tend to be technology-driven and often have unclear ownership and governance across the leadership team. Occasionally, leaders will even admit that they’re not sure exactly what they are doing, running digital development as a loosely managed experiment. In some cases, the production staff is neither informed nor engaged, which can even lead to people blocking or sabotaging the project.
Up-front preparation (sometimes labelled as “strategy”) is best done at the beginning of a transformation effort; however, it should also be revised on an on-going basis.
Based on our work with clients across a range of industry sectors, Argon & Co has identified four essential elements of readiness critical to success. These are: clarity of purpose, governance, jobs-to-be-done, and innovation capabilities.
A good way to illustrate these four elements is through a set of simple questions, for example:
Clarity of purpose
- Is there a clear vision of what you want to achieve?
- Is it expressed in terms that are measurable?
- How will the daily work routines change?
- What are other potential outcomes – both positive and negative?
- How does digitalization of manufacturing enable medium-term and long-term operational performance and business success?
- What is the expected ROI?
Governance
- What is the road map for deployment and who is leading it?
- What is the role of the steering committee; how does it function, and who are its members?
- How are resources allocated?
- How is risk evaluated?
- How are results measured?
- Who are the primary and secondary stakeholders, and how are they engaged/aligned?
- How are other initiatives and programs integrated?
Jobs-to-be-done
- What are the business problems to be solved?
- What are the required new operational capabilities?
- What specific use cases are targeted?
- How are they prioritized and sequenced?
- Who are the users?
- How are digital use cases aligned with your continuous improvement system?
- Which production problems are the best opportunities for innovation, versus continuous improvement?
- What are the similarities and interdependencies among the use cases?
- What are the implied data requirements of use cases?
Innovation capabilities
- What is your process and methodology for innovation?
- What existing staff and resources will be made available?
- What additional skills must be recruited or contracted?
- Where and how will your innovation teams work?
- How are the requirements and preferences of the users collected and prioritized?
- How are new ideas from users captured and evaluated?
- How does the innovation process drive technology requirements and selection (and not vice versa)?
If you can clearly answer all these questions, you probably have a high degree of readiness. But beware – it is essential to reach a shared understanding across the leadership team and the project teams. Would they all answer these questions in the same way? Surprisingly, some teams struggle to have a consistent answer for even the simple questions.
The digitalization of your factory can start small, but over time it will likely become a game-changing transformation. Along the way, you will repeatedly re-imagine your production operations, assimilating new data-centric processes and work methods.
Your strategy and approach will likely be revised multiple times, as your teams learn from successes and failures. Teams will learn to solve problems through agile innovation, applying the latest digital technologies to address practical use cases. Over time, real transformation will take place, delivering significant value to your customers, employees, shareholders, and to our planet.
So, the final question is…are you ready?
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