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Digital Transformation – The 3 things we’ve learned from customers who have the greatest success

by John Joseph | Dec 03, 2019 |

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I recently had a meeting with one of our customers to discuss expansion of our product footprint across their production floor. Our product is one facet of a phased plan to reengineer workflows from quoting parts to rethinking how production is managed. This forward-thinking President plans to grow the company’s top-line and profit over time, and is putting key pieces of the factory intelligence puzzle into place to ensure success. A holistic approach to getting the company mobilized and using technology to create new top-line momentum. I was impressed that he had a vision and was sowing the seeds of a new operating model. While technology integration and transformation usually start at the top, it doesn’t end there. In this meeting, this leader asked us to help him develop a profile for an individual who would lead various technology initiatives for the company. We welcomed the discussion because it offered us an opportunity to rethink transformation across a wider set of company dimensions than just dropping in a piece of software.


Most of my career has been spent conveying information technology into industries such as healthcare, retail, financials and higher education. Working with manufacturing customers is a new experience and it’s been exciting to see how digitalization is able to accelerate a new flow of information from the production floor to the operations center. Comparing and contrasting manufacturing customers from other industries offers some interesting observations relative to consideration and deployment of technology into their mainstream workforce.


A midsized financial company is a good example of the typical technology engagements I worked with at past companies. Because IT is considered the lifeblood and offers a competitive advantage for these organizations, technology people are nested at all levels of the organization, budgets tend to be very large and decisions have 5-10 year impacts on the business. These decisions are usually made by a coalition of people tasked with research, evaluation and support over its lifecycle. At a financial, technology management roles are considered some of the most important jobs in the company. These investments are often 6 or 7 figures in scale and are “bet your badge” decisions that are taken very seriously.


In contrast, mid-sized manufacturing companies ($10-100M rev) have a slightly different mandate. While information is of vital importance to managing work in process (WIP), most will admit that the intellectual property has been really focused on a material transform from raw stock to finished part within very specific tolerances because they ‘fit’ into larger assemblies and final products across a wide range of uses from medical implants to spacecraft. Companies are selected on their ability to make a precise component at cost and quality targets. The most prized employees at a manufacturing company are the master machinists who can look at a part and visualize every step required to make it successfully. Machinists are the lifeblood of the organization, but data is becoming a differentiator and there’s a widening gap in how it’s used. These new roles I call the digital machinists are becoming the new pulse of the organization.


{ “These times, they are a changin” }


With a clear mandate for data on a wide variety of topics being driven by their downstream customers, how do modern manufacturers retool for success while continuing to deliver excellence in making components? While on the surface, the incorporation of smarter tools, deeper measurement and automation have immediate tangible benefits, equally important is building a winning organizational platform in this advanced digital era.


After watching this progression at several of our customer sites, here are 3 things to consider as you start:


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1. Identify a champion.

Likely the most important decision you will make. Select someone who is:

a. A respected leader with a successful track record of wins for the company

b. Comfortable with new technology

c. Fluent and takes the time to immerse and understand the production flow deeply


This person is an intelligent and open-minded leader and displays agility as they solve problems quickly. Designating a champion frees you up to drive the next two items on this list. Keeping the organization (which includes the champion) focused on goals and metrics as the President is far more balanced now. Being the chief and the implementer at the same time can lead to delays and conflicts. Ideally, one should be focused on accountability and the other on delivery to goals.


The key is to break out of the status quo and drive the business to higher output on both top and bottom line. This is a CAN-DO initiative, so people need to get on board. It’s amazing to see these companies accelerate growth by shedding old models and reengineering process flows with new information. It’s a process of discovery and refinement.

2. Goal setting and metrics.

Work to articulate the vision for what this new technology will offer in benefits and 

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growth for the organization. Get people to weigh-in and buy-in. This pays off huge dividends. Recast what the new 

normal looks like by defining the why, how and what. In doing this, people around the room can see how the pieces fit together, and feel ownership for the results. Through this process you will see some natural leaders emerge and they may surprise you. Goal setting lights up a bunch of neurons in process oriented coworkers. This is where the hearts and minds are won and people start to buy-in.


After understanding where you want to go, how do you measure progress? Just as GPS lays breadcrumbs on a digital map for where you’ve traveled, metrics are specific and measurable points in time that indicate success or falling short and why. A few examples we’ve heard early in customer engagements:

“Our production meetings have become ineffective. People come in with half-baked status and don’t want to admit that something’s not working or ask for help. I have no idea what needs attention on the floor and where to direct my top talent to keep production on track. Our control charts are covered in red ink. It’s not effective.”


“Priorities on the floor change daily. I need a way to determine if my highest priorities are going to meet customer delivery commitments. I can’t see the job progress until the end of a shift and by then it’s too late. I have to authorize overtime to catch up. There go the profits.”

Establishing definitive success criteria that are broadcast-able, timely and understood by stakeholders is critical to your competitiveness on several dimensions. Take the time to agree on what winning looks like, how it gets delivered and by whom. Operating in a vacuum without the latest information is pointless and results in goals being missed.

3. Organizational structure and role definition.

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Is the organization designed to succeed in the new operating model? This is part art and part science as people need to complement one another. Consider putting the champion(s) who revealed themselves in the goal setting process as good candidates to put into linchpin activities. Meaning, those activities or actions that are vital to the success of the new metrics driven organization. Let them drive for a while and feel the pressure for success. Delivering a project to full functionality is among the most rewarding experiences a senior leader can accomplish with their team. Celebrate the wins in an environment where you learn fast and iterate even faster. This is a dynamic process.


Mixing people and technology is a tricky balance, but when done properly becomes your secret weapon. If the technology you chose is the right one, it unifies people on the production floor. Modern production intelligence systems should be able to cut diagnostics time to minutes, not hours - and better yet instant. Honestly, if the product you invested in doesn’t create simple real-time performance indicators, show deltas to plan and drill-in historical information, you should remove it and replace it with something that does. Manufacturing analytics is advancing so rapidly that it should be a modular drop-in with results in minutes, not weeks, and should allow your people to accomplish great things right away.


Reward people who want to make a bigger impact. They become the next role models for new employees and set the tone on your culture. It’s more about impact on the business and less about their absolute title.


On the surface, this seems mundane, but your people are always your greatest asset. I’ve always believed that if you put your people first, the returns will be a 10x multiplier. Figure out who your best champions are and get them mobilized for success.


PS - I chose not to over-index on culture in this article, but rather on a system of shared values within an organization that work to unify players into a high performing team against a backdrop of new and enabling technology. I believe culture goes way deeper, is more complex and requires a longer time horizon to form.