How the top 1% of small manufacturers are using low-cost digital tools to stay competitive

Posted on 22 May 2020 by The Manufacturer

The Fourth Industrial Revolution is here and digital transformation is all the rage. Manufacturist podcast host, Chad Perry, takes an in-depth look at what it means to tackle Industry 4.0 head on.

High-sounding terms and complicated technology abound, as do thousands of vendors who may or may not have exactly what your small business needs. Through this frenzy the message is clear: change your ways or go extinct as competitors become more productive with lower costs while offering better products.

But aside from the very real risk of losing your ability to compete, the bigger and mostly unspoken danger is that of getting distracted by information, products, and services that are either not the right fit, too costly, or too complicated to be useful.

In this regard many business owners and decision-makers understand that they need to do something to stay competitive, but face the same questions as to where to start or what to do next, and the practical steps therein.

The question of immediate, practical action is especially relevant as we mount our defenses against the global pandemic and its economic consequences.

Many businesses are going into survival mode, while others are struggling to retool and ramp up production of critical health products. And this is happening on top of the day-to-day challenges of running a small business.

The silver lining in our current state of emergency is that it’s becoming obvious that the organizations who have been able to adapt and respond quickly are the ones who have tools and processes that are flexible to change.

Digital tools offer that flexibility, but adopting digital tools and all the organisational changes that go with them can be a considerable challenge on many fronts: time, expense, complexity, and information overload.

In response to this challenge, I’ve set out over the course of 2020 to interview the world’s leading small business owners, government officials, vendors, and other industrial experts to find out exactly what growth-minded small manufacturers should be doing to stay competitive.

Listen to the Podcast

With the support of The Manufacturer, I’ve been able to reach these experts and bring their valuable insights to the manufacturing community as a non-profit, limited-run podcast called Manufacturist.

Each episode is an informative 45-60 minute conversation exploring simple, but meaningful steps that successful small businesses are taking to ensure they remain competitive.

As of this writing we’ve completed over a dozen interviews, with more to come, available right now on your favorite podcast app or directly on our website here.

And although each of our guests offer a unique perspective, some consistent themes have emerged that you can take back to your business today while exploring the full interviews as time permits.

Guests include:

William Bridgman (United Kingdom)
Warren Services
The Manufacturer Top 100 small business owner!

Malcolm Jeffers (South Africa)
Digital Operations Transformation Strategist
IAAE – International Academy of Automation Engineers
Non-profit promoting digital skills development.

Calvin Williams (United States)
Impruver Technologies
Continuous improvement coaching.

Peter Rifken (United States)
Principal Solutions Consultant
Quick Base
Low-code process automation, software provider.

Digital foundation: people

The most important theme is foundational… that digital transformation is about people, not technology.

The idea behind the Fourth Industrial Revolution is that technology is now cheap enough to deploy just about everywhere, thereby giving decision-makers and operators an unlimited stream of data to predict problems and identify opportunities.

But with so many options and so much data often comes paralysis. What tools to use, which data is important, etc.

It’s all too easy to get down in the weeds and forget that the whole point of technology is to support humans – to free up people to do what they’re better suited to do than machines. Thus, technology is not here to replace people, but to make them more human.

The improvement of people-centric ideas should always be the starting point of any conversation or investment. People-centric ideas include decision-making, safety, quality of life, problem-solving, and customer value.

But choosing the right tools is also important. On that point our experts tend to agree on four concrete steps that any business, no matter how small, can take immediately to help them adopt digital tools with little to no financial risk:

1. Outcomes

First, start with why.

Know the reason for whatever it is that you’re doing. Understand your business problems in detail, how they can be measured, how they rank against each other, and how a successful outcome is identified when each problem is fixed.

Not every problem will have an easy tech solution, but knowing where you’re starting and where you’re going is the least expensive and lowest risk way to get to a solution that works for you and your business.

2. Small wins

Second, fail fast. (Or succeed fast!)

Large, expensive, cumbersome projects that take years to bear fruit are generally counterproductive and difficult to start.

Instead, treat your business as a never-ending series of small experiments that are easy to start without planning, where the purpose is to prove or disprove a new tool or change in process. This is, after all, the core idea behind continuous improvement!

The cumulative effect of small wins can be substantial over the years, while limiting your risk to bite-sized pieces ensures you always have something to show for your efforts without betting the farm, whether it’s a lesson learned or tangible result.

3. Culture

Third, empower your people!

Command and control management is now obsolete. Successful businesses use a hybrid top-down and bottom-up approach where individuals who are closest to any given problem are empowered to experiment with new ideas in alignment with an overall mission set by executive leadership.

Encourage your people to experiment with ways to make their jobs easier, more productive, or safer. Maximise cross-pollination of ideas by pairing up highly experienced masters of trade with individuals who are tech-savvy and typically younger or less experienced in the trade.

This hybrid approach can amount to a wholesale cultural shift, requiring radical changes to mindset at every level of your organisation, but the change tends to be easier as small wins create momentum around clearly defined business outcomes.

4. Leadership

Fourth, invest in yourself!

There is no escaping the fact that you, as a leader, must have awareness of industry trends and take the steps necessary to stay competitive.

Read articles, listen to podcasts, watch videos, ask what your peers are up to, hire a coach, seek out free resources through universities and government organisations, etc.

Use every available resource to self-educate so you can identify the right outcomes relevant to your business, so you can have authoritative discussions with vendors, so you can hire and cultivate the right people, and (most importantly) so you can ignore everything else with confidence.

There’s more to digital manufacturing

The basics I’ve shared here barely scratch the surface.

The challenges we face now are immense…  an unprecedented global health crisis, massive economic disruption, and technological forces that are converging with decades of momentum. The pressure to grow, transform, and adapt has never been greater for any business leader alive today.

But now, with hundreds of years of cumulative experience packed into over a dozen expert interviews, you can tap into an arsenal of wisdom that will help you stay competitive no matter the challenge.

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