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Figuring out the right way forward for your particular digital transformation has everything to do with picking the best place to focus your efforts. A new report by LNS Research (Avoiding Pilot Purgatory) has gathered and analyzed information from industrial companies all over the world about how they are pursuing digital transformation in their operations. Using this information, LNS Research has created its Use Case Navigator, which categorizes digital transformation initiatives into six functional areas across the industrial enterprise: Customer Experience, Connected Supply Chain, Connected Operations, Connected Worker, Connected Products and Connected Assets. The goal is to help industrial companies identify where and how they can start or accelerate their digital transformation with initiatives that are proven to have maximum impact for minimum effort.
Digital transformation initiatives that are skewed this way are not only going to be relevant in times of crisis – when some industrial companies may be slowing down while others are ramping up quickly – but also as we start on the road to recovery and then look to become more future-proof and resilient.
What can we take out of this report that helps us now and into the future? Firstly, it is interesting to note that the “best” use cases, according to the findings from LNS Research, are categorized as Connected Assets[1] and Connected Workers[2]. In fact, three of the top four best use cases are in the Connected Assets category. It is not surprising that the best use cases fall under these two categories and this leads us to the first key lesson to be had from the Use Case Navigator and this report, which is about return on investment.
Choose use cases that easily link to return on investment (ROI)
It is fair to assume that use cases around Connected Assets and Connected Workers are implemented more often – and considered the best – because it can be easier to build successful business cases around them that show immediate financial impact. Connecting assets and workers will have a direct impact on productivity, and productivity translates into profits. This, in turn, increases the motivation and momentum to scale the use case and drive further ROI.
An interesting example is the Predictive Maintenance use case for high-cost assets. The fact that an asset is expensive puts the ROI in a different context. In other words, you could probably afford to make a larger investment to improve the maintenance of a high-cost asset than you would to maintain low-cost assets – but the return will be greater.
Another observation from this research is that Connected Assets use cases are likely to be closer to “business as usual” inside a plant. Connecting assets is not generally a disruption but rather an improvement – meaning that all industrial operations are already well-versed in doing maintenance and so moving to predictive maintenance is not a revolution, but an evolution.
One last point to note here is that the research shows the “worst” use cases – those that are high effort but low value – fall under the Customer Experience category, indicating that the journey from customer experience to profit is likely to be more difficult to document, measure, and track.
Domain expertise is essential to successful digital transformation
LNS Research found that the maturity of the technologies that drive the use cases had an impact on their scores – i.e. as technology becomes more mature, more industrial companies will use it. An example of this is data analytics, which has advanced to the point where easy-to-deploy packages can be bought off the shelf. However, what is important to note here is that the use of mature and advanced technologies must still be fit for your specific purpose. If we stay with the analytics example, analytics has two important elements: first, the pure technology and the algorithms that are provided by super mathematicians, and secondly, the domain expertise to ensure the right analysis is put over the relevant data. It’s about applying a primary technology to a certain domain. An example here is our EcoStruxure Traceability Advisor which gives companies in the Consumer Packaged Goods (CPG) market complete visibility of their supply chain by capturing and analyzing data from different sources and stakeholders. It tracks and traces products as they move along the supply chain, providing data about their history, location, and suppliers. Transparency ensures full visibility into every piece of information related to the product, proving their origin and highlighting information about ingredients, allergens, physical characteristics, and other key attributes.
Domain expertise is especially important at times when your workforce may be inaccessible – either because of necessary social distancing practices and work-from-home requirements, or generally as skill shortages grip every industry. In a plant, the high rotation of people due to experts retiring and newer workers coming in diminishes the level of expertise held within your four walls. Primary technologies with embedded knowledge, however, can be used by someone who doesn’t know how to operate the machine or line, and compensate for a lower level of skills and expertise onsite.
Consider additional business needs and outcomes
One of the use cases in the research from LNS that is considered to be high effort but low value is remote operations centers. While it is true that the journey to digitally transform operations control can be lengthy, and sometimes with low ROI, other business performance indicators could mean this type of use case should still be considered, particularly during and following a time in which all industrial companies have had to operate with strong restrictions for on-site employees. Companies with remote operations and geographically distributed supply chains should view remote operations centers with a renewed perspective. Increasing their investment in this area means they would stand to benefit from greater collaboration, sharing of best practices, quicker decision making, and improved safety now and into the future.
To sum up, industrial companies that are either starting or accelerating their digital transformation can find LNS Research’s Use Case Navigator to be a helpful guide to choosing the digital transformation initiative that best suits their specific needs. Combining that with rigorous consideration of needs like ROI, domain expertise, and other business outcomes, they can embark on the path to success.
Download the full report, Avoiding Pilot Purgatory: How to choose the right use cases to accelerate industrial transformation.
[1] Connected Assets use cases: for asset-intensive industries, reducing costs and improving asset performance
[2] Connected Workers use cases: improving health and safety of workers, sharing expertise, and connecting workers to the data and expertise needed to improve operations and outcomes
