Authored by Steven Shutt
In the realm of manufacturing there has long been discussion around revolutions in industry. A broad overview includes the first industrial revolution with the quintessential mental image of steam and coal-driven industry in the 1800s, Henry Ford’s assembly lines, and the electrification of industry bringing consumerism in the second revolution around 1900 and internet-connected computers transformed manufacturing in the third industrial revolution circa 2000.
The modern day brings a potential fourth industrial revolution, commonly referred to as Industry 4.0, which could be just as transformative as the first three. In this revolution, automation and artificial intelligence are expected to play a large role in revolutionizing manufacturing yet again. With cornerstone pillars of actionable and transparent data and digital trust, the tools that will drive Industry 4.0 have developed new processes, products, services and technologies including:
Ultimately, like the first three industrial revolutions before it, these technologies will drive a number of improvements for the processes where they are applied, regardless of industry. Technology integration for all employees drives increased productivity, improved data capture and better visibility into common work processes. These processes are then ripe for re-engineering or optimization to minimize downtime, errors or increase throughput in a positive feedback cycle that drives results for the business. Further, these same tools provide real-time data to produce actionable insights for faster response times for issues like customer requests, breakdowns and production errors.
A key factor to note is that while the lessons above have first been applied to manufacturing, heavy industry and “blue-collar” work; every lesson learned and approach can also be adapted and applied to the service economy (sometimes called “pink-collar” work) and the information economy (“white-collar” work). While this may sound unconventional, it helps to realize that almost all business is built around workers adding value to something before handing it off to another downstream in the process. After all, what is the ultimate difference between a line operator adding a component to a widget, a software engineer adding code to software or an editor adding a sentence to a proposal? Many challenges in management come down to the same core issues of resource management to produce at the quality and quantity needed—the terminology, individual components and the work environments are the primary differences. While not as consistently recognized as Industry 4.0, the digital transformation of technology-driven information economy workplaces will in many ways mirror the monumental shift that occurred in previous revolutions in industry, but the lessons learned in manufacturing can be applied to other areas.
While now almost cliché to discuss, the Covid-19 pandemic upended every aspect of society and demonstrated that nothing is certain in business except for the need of adaptability and constant innovation. For many companies, the need to quickly pivot to new paradigms in the short-term was a stress test that challenged many aspects of their business. The goal for many was digitizing their operations—a difficult proposition in the best of times—which includes the complex tasks of coordinating many interdependent systems including technology enablement (front- and back-end), upskilling employees for digital expertise and the deployment of new collaborative tools while maintaining in-person synergies. For companies able to weather the storm, it is clear that properly enabled digital work environments and processes can provide benefits greater than what was invested—thrive, don’t just survive.
To bring about the benefits of Industry 4.0 to the information economy, digital transformation must be thought of as an on-going philosophy, rather than a one-time project. Buy-in and focus from the end users (i.e. the workers in every department) is needed for any transformation to be successful because the most knowledgeable and impactful operations people on each process in a manufacturing line are those that live it day-in and day-out. Since the lax return to the status quo is always a threat, true culture and operational change is needed from every level of the organization.
Any inevitable problems that do occur in a transformation should be challenged communally and continuously improved upon so the entire organization can take value from the lessons learned. This sort of culture change is best done by integrated organizational change management efforts, ideally led by personal and financially empowered professionals with a clear direction and belief in the end goals. While this can often incur an additional cost, this expense is necessary for your businesses digital transformation to succeed.
By re-engineering business processes, cross-team and interdepartmental silos are broken down with seamless handoffs of work products, data and other information; creating stronger, more efficient and less error-prone departments and businesses. Similar to the needs of Industry 4.0, the core needs for a successful digital transformation are interoperability and seamless communication between departments, the transparency of information across departments and teams (except where deemed a risk for security) and respect for each employee and team to make their own decisions. This focus on the processes, products and people involved at each step can be transformative in getting disparate departments to act as one cohesive unit, connected by seamless technologies.
Many of the benefits that are traditionally ascribed to tightly integrated, in-person teams are those that can be unlocked through successful implementation of digital systems. High-bandwidth interactions are highly necessary during design or strategic work and with non-aligned tools and personnel information on these complex tasks can be misunderstood or missed entirely. On the other hand, tools and processes designed and implemented around specific tasks and workflows can mitigate or eliminate these issues. To look at the previous example of design work, collaborative design sessions using software can be much more effective on most metrics versus a limited in-person meeting or, worse yet, a virtual session without the tools to collaborate effectively. In this scenario, the missed opportunity of including all stakeholder voices is a missed opportunity in the design, productivity, inclusion and diversity goals of the project.
With the abundance of digital technology rising, navigating your business’s current digital workspace can be complex. Baker Tilly’s knowledgeable professionals can help assess and implement the right process improvements and digital technology to optimize your operations. To learn more about these topics, or to start investigating how to digitally transforms aspects of your business, contact us.