The digital transformation, digitization, the Internet of Things, artificial intelligence, virtual reality, augmented reality…these technologies are no longer hidden secrets……So then why do some digital initiatives fail? In this blog I’ll try to identify some of the reasons (along with some data of course) I believe digital initiatives don’t take off, or get off the ground but then quickly come crashing back to earth.
1. Lack of a digital strategy
I’ve seen companies invest in many different digital technologies to address specific needs or applications, but their actions weren’t necessarily part of a bigger strategic vision around digital. And “no strategy” usually equals “no success.” (By the way, you’ll notice that a number of the issues I am going to mention come back to this one, a lack of strategy. It’s probably the single biggest reason for failure.)
2. Cool technology but no problem? (Or, let’s find a business problem to solve)
How many times have you purchased a gadget or an app simply because it seemed cool, but in the end you didn’t find any practical use for it? This is not that different in the industrial world where we also test cool technologies without identifying any specific problem beforehand. A related and almost even bigger mistake is to then chase a problem just to validate the technology we acquired. You can waste a lot of time and resources doing that.
3. Unclear or difficult to measure ROI
Some technologies are hard to measure their ROI because they are related to cost avoidance. Example: technologies that help avoid tailings dams breaches or safety issues but which don’t necessarily deliver any measurable improvement in productivity. How do you measure something that doesn’t happen?
4. Lack of skills
This is somehow linked to #1, the lack of a guiding strategy. Without a strategy, how can you know kind of skills your employees should have. Cyber security? UX? Big data? Project management? On top of that, there are lots of soft skills required to execute a digital strategy (entrepreneurship…… Unconventional thinking…..team working….)
5. DIY and F (do-it-yourself and fail)
During my many years of automation experience I’ve seen a good number of failures when systems were developed by users themselves even when there were plenty of good off-the-shelf solutions available. They are eventually dropped due to poor performance, technology obsolescence, or simply because they were so customized that they were impossible to maintain or improve. And guess what? By the time that happens your developers have moved on to other opportunities and no one else even knows what is “under the hood.”
6. Wrong partner
OK, so you’ve made the right decision and decided not go it alone and you want to work with a specialized partner, but you still need to be careful about choosing the right one.
Digital fever is flooding the market with pseudo-digital specialists and we often see suppliers who push users to apply highly overengineered solutions or simply wrong solutions. A classic example that comes to mind is an asset health monitoring solution that uses a complex “predictive machine learning analytics behemoth” when a simple but effective condition monitoring application would be sufficient.
7. To scale or not to scale?
Some applications and initiatives that do meet with a level of success in a particular area are relegated to failure simply because they never get the exposure they deserve, and so they are never replicated to other areas where they could foster innovation throughout the rest of the organization. Unfortunately, they will die alone like so many other pet projects. Again, it comes back to a lack of strategy. If incubation is part of the strategy then there needs to be a defined path forward that can take small successes and turn them into big ones.
So those are my observations. Digitization is not a panacea for success, but there are things you can do if you want to avoid some of the common pitfalls. And if you want to see some of the proven digital solutions Schneider Electric can help you leverage under our EcoStruxure™ platform, click here to explore”
PS – Why Part 1? Because I would appreciate your help and feedback to share the reasons why you think digital projects could fail. Let’s work together for parts 2, 3, 4…