Best Practices for Manufacturers Planning a Digital Transformation Journey

Jul 28, 2022 5:00:00 PM / by PlantStar Team

Technology has been advancing at a breakneck pace. Many manufacturers understand the need to embrace new building blocks: mobile, IoT, artificial intelligence, digital twins, and advanced robotics.

Digital transformation can be a daunting undertaking, especially when trying to figure out where to start and how to maximize the journey’s benefits and minimize its potential hiccups. But with careful planning and thoughtfulness, businesses, large and small, can manage the process. Recognizing the digital business case, communicating with employees, creating a roadmap, and deploying a Manufacturing Executive System (MES) help suppliers avoid potential pitfalls.

Understand the Digital Business Case

Digital technology is the linchpin for the next Industrial Revolution: Industry 4.0. It enables a supplier to transform their business by moving away from inefficient, often manual, legacy manufacturing processes to modern digital exchanges. Adopting it results in reduced paperwork, the elimination of data silos, improved productivity, streamlined supply chains, and less downtime. Those gains result in quantifiable benefits for manufacturers:

  • 10% to 20% of value-add production costs coming out
  • 15% to 30% reduction in working capital

Yet, many (38%) suppliers have not embraced digital technology. They need to break down their own barriers to adoption or else find themselves at a competitive disadvantage. Here's how companies can plan: 

Know Your Limitations

No supplier starts out as a digital technology expert. Depending on the firm, limitations arise in many different places: a general lack of knowledge, security concerns, a weak supply chain, and no or limited access to digital talent.

As companies embrace the new capabilities, they need to be realistic about the learning curve. Time is needed for new manufacturing processes to take root and thrive. Problems will arise as blind spots are exposed. Therefore, they need to start slowly and ramp up as they gain experience and become more familiar and comfortable with digital capabilities.

Communicate With Your Employees

The transition is not just a technology undertaking but also has a major impact on personnel. Such a dramatic change forces employees out of their comfort zones and introduces uncertainty, doubt, and fear, which can quickly derail even the best migration plans.

Communication is key when it comes to avoiding such pitfalls. Employees need to understand the project goals and how they will improve their workday. Many individuals fear for their employment. Be sure to keep employees in the loop throughout the journey, so they provide feedback, understand the process, and help to make the transformation a success.

Assess Your Current State

The next step is to take a good, hard look at your current state. What technology do you have in place? What processes are followed? How well do your employees understand technology? Which processes work? Which needs improvement? How can digital solutions streamline workflow? This assessment helps companies identify areas that need improvement, so they better focus their digital transformation efforts.

Define Clear Goals and Objectives

Next, manufacturers need to clearly define their goals and objectives. What exactly do you want to achieve with the transformation? Do they want to improve the customer experience? Add more product options? Increase operational efficiency? Boost revenue? Improve productivity? Enhance quality? Only when they know what their goals are can they start planning how to achieve them.

Implement Change Management Processes

Any digital transformation journey brings about change, which will need to be managed. After all, suppliers will likely alter the way employees work significantly. Change management processes help to ensure that these adjustments are made smoothly and that employees adapt to the new way of working.

Develop a Roadmap

Digitalization affects every part of the company and thus needs to be rolled out in a highly coordinated and well-planned way. After they know what they need, businesses should develop a roadmap that articulates their digital transformation journey. The roadmap creates a staged approach that senior management uses to develop a long-term strategy, define end goals, and allocate the resources needed for the transformation. Be sure to create milestones and include deadlines in the roadmap, so you clearly measure your progress along the way. This plan also serves as a guide for teams and keeps everyone on track.

The Importance of an MES

Digital transformation moves suppliers from material based to information-based businesses. Their ability to examine and use information becomes just as important as anything clever that they do in the manufacturing process.

However, generating new information is only the first step in leveraging it. The data has to be stored in a common place and have a standard format. Manufacturers need to deploy MES software, like PlantStar. This enterprise system acts as a traffic hub providing real-time production monitoring, synchronization, and analysis of plant equipment data. With an MES solution, they integrate autonomous manufacturing functions into their overall manufacturing operations and realize benefits, like process improvement, greater efficiency, less product variation, higher yields, and greater productivity.

Digital technology has tremendous potential to empower manufacturers, so they eliminate waste, break down traditional barriers, increase productivity, and gain more visibility into their operations. While it has great potential, it also can be difficult to implement. Thinking deeply about the process and following best practices mitigates potential missteps.