Is Digital Transformation All About Outcomes? Here’s The Truth

When people hear talk about digital transformation, they imagine that it’s something that can be done overnight by getting new software or getting a new piece of ‘digital equipment’. The true meaning of this term has been lost to overuse and the marketing gimmicks of CIOs selling overnight IT solutions.

What is digital transformation?

Digital transformation is persistent drive towards developing a technological ecosystem that is aimed at the continuous improvement and optimization of operations using digital technology. It’s aim in the manufacturing industry is to solve day-to-day manufacturing problems and improve the operations processes.

Digital transformation calls organizations to continue to rethink their use of technology and human capital to improve business performance. It is a continuous journey.

The biggest challenge in this transformational journey comes from lacking the proper human resources that understand more than technology uses. They should know how to continuously leverage the use of technology for business improvement.

This brings us to an important question, how best can you leverage digitization for the progress of your business?

Opportunities in your supply chain

One of the best ways to leverage new data technologies is with supply chain management optimization. The data available can help your organization take control of the entire process to make informed decisions at each step of the way- from the acquisition of raw materials to the delivery of the finished product to customers.

With digitized systems, the whole process is transparent. From determining the amount of inventory an organization should hold in its storage facilities at a given time to predicting with accuracy your customers’ needs ahead of time, there are many elements of supply chain management with drastic room for improvement using digital transformation.

Without strong demand prediction capabilities, blind production often leads to excess goods that unfortunately go to waste. Customer needs can be anticipated, and you can produce what customers want before they request for it.

With digital transformation, an organization can produce the highest quality and most accurate amount of products while measuring how to incur the lowest possible production cost.

The road to digital transformation

When people hear of digital transformation, they often think it means that there needs to be a shut down of all current operations to start fresh with completely new processes. This happens with some organizations, but it is not necessary.

If you want to leverage technology effectively, the best way to do so is to start by identifying small day to day problems and then venturing out to find the right technologies that can help solve them. It could be in customer service, inventory management, or in labor cost reduction.

The following are technologies that can be used for digital transformation.

Software applications

You can acquire software applications for virtually any task in your organization nowadays. With the right software applications, you can help reduce the workload.  

The right software can help managers save time in calculating costs per employee or product. Take Zhejiang Medicine, for instance, a pharmaceutical company that has adopted a 100% paperless policy. Being a pharmaceutical company means keeping an inventory of a high volume of records to ensure that the drug batches are not contaminated and that the process needs proper documentation for government inspection. This can generate a lot of paperwork.

To solve this, Zhejiang Medicine adopted the Rockwell Software PharmaSuite, an application tailored to their record-keeping needs. They transitioned from a manual recording of information to a digital recording system.  

A company can interpret their data to anticipate customers’ needs as well as predict market trends using analytics software. R is a great example of an incredibly useful, free software environment with immense statistical computing power to help meet these needs. An organization’s production decisions, from the acquisition of raw materials to the distribution of the finished product, are informed and calculated with the kind of information that a statistical processor like R can generate.

The cost of production is greatly reduced by focusing energies exactly where they are needed using demand-driven insights.

With the proper analytics, market demand can be predicted and inform the production schedule drawn. An organization can also decide to get contingent workers busy during periods that have high production needs predicted instead of using full-time workers year round that are not fully utilized during the slow seasons. This cuts unnecessary labor costs.

With digital simulations, a machine’s capacity and capabilities are determined before they can be acquired with the use of a ‘digital twin’. A test to ascertain performance under different conditions can also be carried out before the deployment of the physical machine. This savings greatly reduces costly machine time.

Mobile apps are another game-changer in the market at the moment. With almost everyone using smartphones nowadays, the closest way to interact with customers is to be at ‘their fingertips’. Using mobile apps, companies can make your products and the information about them a lot more accessible to customers. You can also engage with customers more on such platforms by providing them with real time updates.

While digital transformation should generate results, it is not about getting from point A to point B. It is about becoming the kind of company that is ready for continuous evolution.