Why tech transformation matters: ‘Digitalization is not a destination’
During a session at the recent Private Networks Forum, panelists put aside all those technical buzzwords related to digitalization and digital transformation — you know the ones: Artificial intelligence, machine learning, automation, connectivity, etc. — and instead addressed the why of the matter, a question that attempts to bridge the gap between strategy, technology and the workforce.
Digitalization: Where business strategy and technology meet
For Siemens Digitalisation and Sustainability Lead Joan Mulvihill, the strategy and the reasons behind an organization’s particular digital transformation are far more important than the specific technology being used to facilitate the transformation. “Digitalization is not a destination,” she said. “No one is going to get any prizes for being the most digitalized version of an organization that is selling a product or service that people don’t want anymore,” she said. To get at the why then, Mulvihill continued, organizations must first ask themselves what their market will look like several years from now and what needs to be done to ensure they remain relevant in that future market.
The why involves understanding, first and foremost, that technology can remove, replace or improve several operations, processes and systems within an organization. According to Conrad Leiva, the VP of ccosystem and workforce education at CESMII-Smart Manufacturing Institute, there has been a lot of early digitalization success around increasing internal productivity and cost efficiency, as well as the reduction of energy, particularly for industries that produce things like cement and chemicals and food products, as these all require energy-hungry equipment.
“We’ve also seen now, when you start looking more strategically, benefits like speed, agility, [the] ability to change your product mix quickly [and] to create stronger partnerships and innovate,” he said, adding that there has been a notable move away from “the period of early adopters” and that we are “crossing the chasm” with a lot of enterprise-level technology. “We are seeing [organizations] looking at technology as part of their strategic plan,” he said.
Because digitalization fosters a better environment for innovation, it can result in significant market disruption and differentiation, particularly if an organization has room to grow. For instance, longtime IBM manufacturing industry group leader and Intel Manufacturing IOT Council leader Mary Bunzel described watching smaller companies scale throughout her time with IBM and Intel as the result of digitalization. Specifically, Bunzel shared how she encountered several organizations that “incubate[d] a core capability within their organization, automate[d] it for disruption and then [broke] that company off as an independent service.” In other words, these companies “productized” a core capability and turned it into an entirely new revenue stream.
Bunzel also shared that it’s “absolutely key” to strategically align technology deployments to the direction that the enterprise is going to ensure that you have support from leadership, as well as unified corporate messaging to pass along to the workforce. Otherwise, technology and the improvements it brings will not become part of the organization’s DNA, which Bunzel said is the ultimate mark of a true and successful digital transformation.
Don’t forget the workforce: ‘Technology is not a self-driving car’
“The technology is interesting … and a vehicle that will get you there, but it’s not a self-driving vehicle. It needs people in the organization to go on that journey,” commented Mulvihill. “It’s all about the people… and finding the technology that [allows] people to grow sustainable careers.”
Building from Mulvihill’s self-driving, or not-so-self-driving concept, Leiva noted the importance of workforce education. “The workforce … need[s] to keep up with all the technology changes and know all the options that are available and how practical they have become, he said.
For its part in this, CESMII has established regional innovation centers aimed at provided this much needed education. “We can demonstrate the technology and bring manufacturers to see first-hand a lot of that integrated technology in person because for a lot of manufacturers, seeing is believing,” Leiva continued.
Both Leiva and Bunzel stressed the need to ensure that the criticality of new technology and digitalization is understood within the entirety of an enterprise, from top to bottom. “The why of these investments… needs to be understood by the whole company and by the workforce,” Leiva said, claiming that a culture that doesn’t put this at the center of its vision statement cannot truly embrace digital and higher levels of collaboration and innovation.
Earlier on in the conversation, Mulvihill commented that it’s incredibly easy for companies and their workers to “get lost in the maze of technology,” but later argued that adding technology into an organization can actually improve that organization’s the human element if done right.
“The more technology we put into organizations, the more human those organizations will become,” she said. “If we automate everything that’s automatable, then the only thing left for humans to do is that which is truly human, and the only thing that is truly human is our intention, our purpose, our creativity, our ability to make decisions that are beyond the data. There will always be a role for people in organizations, but there will not always be a role people who do not what to engage with technology at all.”