To be Actionable, Digitization Objectives Need Clarity

To be Actionable, Digitization Objectives Need Clarity

Earlier on in my career, I was selected to be part of one of the dreamy types of projects that was meant to combine best practices with then cutting-edge technology. We were given a ballpark budget and timeline, along with vague directions to increase automation and enable flexibility, such that when this new project was operational, everyone would be blown away by its speed and agility.

To be honest, it’s been a while since I thought about it, but a LinkedIn comment recently caught my eye, which immediately took me back to that conference room brainstorming sessions with rolls of white paper, Excel spreadsheets and stacks of RFP responses. We were confident that we could make the project a success, but more than ten years later I’m still unconvinced that it lived up to the bold, and also ambiguous, objectives.

Back then, our team of internal and external partners felt anxious and isolated, but really that could have been nearly any project, in any company and in any decade. It’s especially relevant for supply chains today, as they’re increasingly tasked with creating competitive differentiation for the broader business, but with little specificity as to how.

Of course, digitization is one topic that’s driving ambition without direction for many. Considering that the direction often comes from an organization’s senior leaders, just how do they perceive digital technologies and their role in the future of supply chain?

Executive Uncertainty

Throughout the hierarchy, the majority of the supply chain community agrees that informational technologies are disruptive and important. The sentiment is growing year on year, especially for big data analytics and cloud computing. For operational technologies, however, the most senior levels of the supply chain organization are still the most unclear on the usefulness of several new forms of digitization.

Information chart visualizing how different job functions view the importance of operational technologies, based on 1,415 survey respondents.

The business cases for these technologies are only beginning to emerge as spot usage is occurring, but those uses have yet to achieve enough momentum to warrant full executive support. The clarity on these uses and continued exposure to real examples will help in building the support needed to transition investments from operating expenditure to more substantial capital expenditures.

The opportunity to create those business cases will differ by industry, as some sectors are already more advanced than others. For example, our 2016 Future of Supply Chain survey tells us that 80% of respondents from the automotive industry find advanced robotics disruptive and important, but only 54% feel the same about 3D printing.

In comparison, the aerospace and defense industry is more bullish on 3D printing, but is finding ways to combine both in the development of satellites. For Boeing, the investments into practices that involve the use of modular 3D printed parts was out of necessity, but notable investors, including Richard Branson, see opportunity, too.

No matter the industry, businesses need to clarify objectives and successfully progressing digitization ultimately depends on the ability to make decisions and/or drive actions. Starting with solidified process fundamentals and an aligned mindset as the foundation for exploration, companies can begin the process of acquiring, filtering, analyzing and then acting.

Infographic visualizing the process needed to successfully progress digitization.

This simplified type of approach is exemplified by that very comment on LinkedIn that reminded me of the project I worked on years ago. Derek Black of ARM Automation in Austin, Texas works with a number of companies in creating custom automation solutions, and also counsels executives on developing strategies.

Within his comment, Derek says, “In order for automation to be successful, even with advanced controls and ‘machine intelligence’, (companies) must first work to structure the tasks and limit/manage/control for variables and extraneous cases. From the factory floor to detecting fraud to self-driving cars, this axiom will hold true. Stop expecting a free ride or a silver bullet if you want a viable and cost effective solution.”

We’re already seeing digitization’s potential for disruption, but the hype must be tempered with real opportunity. Or, as Derek says, “set reasonable expectations for now, and we’ll all be better off”.

Your questions and feedback are always welcome via email at [email protected], or via Twitter @pvanhull.

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Author Patrick Van Hull

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