How to create a winning digital transformation strategy

Recent studies clearly show that manufacturers understand the opportunity digital transformation offers, but how can they ensure the greatest benefit from it?

Data Digital IT - StockThe building blocks of what’s being referred to as the Fourth Industrial Revolution (4IR) or Industry 4.0 are predominantly technologically-based – big data, cloud computing, automation and robotics, the (Industrial) Internet of Things, and business intelligence tools. Combined, these technologies are ushering in a radical new era of digital transformation.

The concept is relatively simple, and indeed many manufacturers have successfully grasped it. What’s more difficult however is putting a strategy in place to connect the building blocks and leverage their combined capabilities.

An underlying error of judgement for many is the belief that shifting towards a 4IR or Industry 4.0-ready business requires the adoption of every one of these building blocks, which is a fallacy.

A significant part of the confusion stems from the fact there are still too many misnomers surrounding not only this revolutionary shift itself, but the technologies driving it – regardless of reports to the contrary.

Cutting through the noise or hype and educating executive teams is vital to overcoming this confusion, something seen through the rise of senior positions with ‘transformation’ or ‘adoption’ in their titles.

Whether officially titled as such or not, these internal sponsors are vital in demonstrating the business case for change, establishing a robust digital transformation strategy and helping to drive it forward.

Modern technologies typically cut across internal siloes, bridging departments, processes and duties. This can pose a challenge when attempting to form your business’ connected approach as it isn’t immediately clear whose responsibility it falls under.

However, the value of leadership shown by an empowered individual or team of individuals cannot be overstated, particularly if they sit outside of a specific silo and have visibility across the entire organisation.

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Though termed ‘digital transformation’, the transformation refers to the effect digital technologies can have on a business’ productivity, revenue and, ultimately, growth.

Though termed ‘digital transformation’, the transformation refers to the effect digital technologies can have on a business’ productivity, revenue and, ultimately, growth. It does not refer to the timescale of change.

The deep-rooted changes across process, people and culture necessary to get the most out of digital connectivity won’t be an overnight transformation. It should be viewed more as an incremental journey, one which will look very different from business to business; there is no onesize- fits-all approach.

That is why it is imperative to map out clear objectives – not just the beginning and end goal, but also the people responsible for achieving them and structured timeframes.

During both roundtables, discussions emphasised the importance of having clearly defined targets and the return on investment (ROI) mapped out for each step of this journey, as well as for the project overall.

Without having such a robust, coherent business value proposition, it was far more difficult – if not impossible – to achieve buy-in from senior executives and decision-makers.

Several roundtable delegates also noted that they saw great value in creating scalable digital strategies comprised of several smaller transformation projects.

These test cases or pilots relate to a specific Industry 4.0 building block or combination, allowing them to be trailed on one process or area of the business to capture experience and knowledge, which in turn informs a broader rollout or a greater level of connectivity across the ecosystem.

Enabling a Connected Ecosystem - Front CoverThis article is taken from the recent white paper, Enabling a Connected Ecosystem, based on research conducted by both The Manufacturer and Microsoft, and the insights gained from two exclusive roundtable events which brought together senior leaders from across UK manufacturing.

What the past 18 months have clearly demonstrated is that those most likely to succeed in the modern connected business environment are those eager to engage customers, empower employees, and successfully leverage these new digital technologies.

The full white paper – co-created by The Manufacturer and Microsoft – explores digital transformation and connectivity in the most practical sense.

If your business has already made the first step towards a connected ecosystem, or is considering taking one, this is vital reading for you and your business’ decision-makers to question your existing processes and get the most out of your connectivity journey.

Click here to download the full white paper.