The digital revolution has transformed every area of society, from commerce and banking, to healthcare and education. Throughout this digital transformation, one common theme has been clear: those who fail to embrace technology inevitably fall behind and get replaced. This continues to ring true for manufacturers facing the need to reduce costs and compete in a global marketplace.

What Does Digital Transformation Mean?

digital transformationIn a nutshell, digital transformation is the huge shift that is occurring in manufacturing as all areas of the field begin to take on more digital technologies. This doesn’t just mean you’re throwing in a few computers to the mix. This is a huge transition to a fully digital process that works on all levels.

Customer expectations and distribution can shift in a heartbeat and digital transformation can help a manufacturer adjust to these shifts. This transformation isn’t only physical. It also incorporates data and statistical analysis to improve manufacturing processes to ensure that a business thrives. Should a business not choose to embrace digital transformation, they’re setting themselves up for failure and ensuring their competitors have an advantage over them.

What are the Four Pillars of Digital Transformation?

When it comes to embracing digital transformation in your manufacturing company, there are four main areas you’ll want to address to fully implement the idea. They are:

  • Empowering Your Employees — First, you’re going to want “digital buy-in” from your employees. You need to allow them to innovate as much as possible and this may be difficult if you have employees who feel hesitant to embrace technology. Instead of letting this hesitation foster, empower your employees to advance a step at a time, even if it is baby steps like moving over to a cloud-based format.
  • Engaging Your Customers — Use data and statistical analysis to better engage with your customers. By taking a “deep dive” into the data, you can track all your interactions with your customers so that you can expand on their experience and provide better customer support.
  • Optimizing Your Processes — The third pillar, optimizing your processes, is one of the best areas that digital transformation can help with. By working through systems in the old, pre-digital manner, you probably have a lot of redundancies and areas where the time lag is so significant that it can impact your whole business. Digital transformation can streamline these processes so that your business runs optimally.
  • Transforming Your Product or Service — This is all about changing your core business to stay current with technology. If you’re used to delivering a catalog of products that rarely changes, then it’s absolutely necessary to modernize so you can stay current. Customization and other options are a must and new technology can help provide you with this.

What are the Challenges of Digital Transformation?

CPQ Solutions White Paper Download imageThere are several challenges you must overcome to implement a digital transformation. These include:

  • Resistance to change and employee pushback, either because they aren’t familiar with the technology, or they’re afraid that automation will cost them their jobs.
  • Lack of information is an issue as many businesses don’t have the digital expertise to even know what’s available or how to get started.
  • A big challenge for many businesses is a lack of a strategy to unite the company behind digital transformation. If you don’t have a plan, it will not be successful.
  • Yet another issue is the budget that is required to make this transition. Technology can be an expensive investment, but failure to adapt is more expensive in the long-run.

What does a Digital Transformation Strategy Look Like?

There are multiple steps to creating a digital transformation strategy. In order to make this work, you will need to:

  • Get buy-in from your employees. It is absolutely critical to involve employees throughout your company early in the process to get them excited about the possibilities of this digital transformation. Educating your employees about the opportunities available is key.
  • Create a budget. Once you have buy-in, you need to look closely at your total budget and determine how much you’re willing to set aside for the digital transformation. This will be used on new equipment, software, and training.
  • Assess your current digital state. Next, do an analysis of where you stand with your digital readiness. Think of this like a road trip. You have to know where you’re starting from before you can figure out how to get where you want to go.
  • Create a list of SMART goals and outcomes. Now that you know where you are, create your goals for making the transformation. Do you want to implement a new software system or a digitized process? Make sure that you list out all of the sub-points as steps you need to reach to get to these final outcomes.
  • Figure out your weaknesses. Once you know where you want to go with your transformation, look back at your current state and determine where you have weaknesses and gaps. Is it that you have the software but are lacking in employee training? Then you need to know how to address this.
  • Create your roadmap. Finally, you’ll want to make a map of exactly how you will achieve your transformation. This flowchart should include every step along the way as well as those employees who will be responsible for achieving these steps.

The company that refuses to modernize is making itself obsolete. In order to take the next step in the digital revolution, you need to embrace the concept of digital transformation. That means addressing the challenges so that you can overcome them and move your business forward.