{"id":9675,"date":"2021-09-16T07:34:58","date_gmt":"2021-09-16T12:34:58","guid":{"rendered":"https:\/\/flevy.com\/blog\/?p=9675"},"modified":"2021-11-24T10:50:51","modified_gmt":"2021-11-24T15:50:51","slug":"digital-manufacturing","status":"publish","type":"post","link":"https:\/\/flevy.com\/blog\/digital-manufacturing\/","title":{"rendered":"Digital Manufacturing"},"content":{"rendered":"

\"\"Digital Transformation<\/a> in Manufacturing<\/a>, or Digital Manufacturing for short, is a matter of survival now for manufacturing concerns.\u00a0 Manufacturing companies desirous of survival have no choice but to hop on the Digital Transformation bandwagon, rapidly.<\/p>\n

Business Transformation<\/a> of any kind is not an easy endeavor.\u00a0 Change Management<\/a> of Digital Manufacturing is typically more difficult than any Change or Transformation Program that an organization may undertake.<\/p>\n

Forming a strategy to leverage digital technologies is the 1st step in transforming a manufacturing concern towards Digital Manufacturing<\/a>.\u00a0 Bigger challenges are faced in strategy execution.<\/p>\n

For Transformation execution to be effective, CEOs must reconsider almost everything about the way their companies work; for instance, establish new Business Models<\/a>, reorganize their Organizational Design<\/a>, and also rethink their Leadership<\/a> style.<\/p>\n

Specifically, there are 3 key pillars of Digital Manufacturing execution that need careful consideration for the Transformation to be successful:<\/p>\n

    \n
  1. Business Model over Technology<\/li>\n
  2. Independence of Digital Operations<\/li>\n
  3. CEO-driven Digital Transformation<\/li>\n<\/ol>\n

    \"\"<\/a><\/p>\n

    \u00a0<\/strong>Let us consider the key pillars a little more in detail.<\/p>\n

    Business Model over Technology<\/strong><\/h2>\n

    Shifting from old technology to new is easier than changing the Business Model of any concern, especially a manufacturing concern.\u00a0 Customarily, manufacturers sell machinery, hand out software as complementary, and offer after sales repair and maintenance service for the machinery.<\/p>\n

    For Digital Transformation to be truly successful, the whole way of doing business has to change.\u00a0 Manufacturers have to look at what they are selling i.e., outcome instead of a product.\u00a0 What is important is manufacturers should be willing to do away with existing Business Models to create and capture new value.<\/p>\n

    Value creation is achievable in many ways using industrial Internet of Things (IoT)<\/a> by manufacturers.\u00a0 All of the avenues for value creation should be used in parallel so as to gain the largest impact.<\/p>\n

    Value created through Digital Manufacturing can be captured in 2 ways:<\/p>\n

      \n
    1. Software as a Service and Subscriptions\/Licenses<\/li>\n
    2. Offering Success as a Service<\/li>\n<\/ol>\n

      Independence of Digital Operations<\/strong><\/h2>\n

      Digital operations can create a meaningful impact only when they are independent of the main business.\u00a0 Independence is important but so is proper linkage with the industrial business.<\/p>\n

      Initially, understanding regarding value provided by Digital operations may be very limited in the manufacturing business therefore cooperation may be inhibited.\u00a0 Finding ways to link Digital operations with the manufacturing business must cater to the requirement of understanding how the machines work.<\/p>\n

      Resistance from the manufacturing business is expected when the 2 forces combine, especially when the Digital operations grow.\u00a0 Delineating who handles customer relationship and all factors associated with it, is also a question that may spring up in cooperation between manufacturing and digital operations.<\/p>\n

      Ways to obtain gains from linking vertical business and the horizontal digital function must be found.<\/p>\n

      CEO-driven Digital Transformation<\/strong><\/h2>\n

      Sponsor of the Digital Manufacturing initiative has to be the CEO.\u00a0 Only the CEO has the influence to decide the divergences between the old manufacturing business and the new digital business.<\/p>\n

      CEOs have to drive the Digital Manufacturing shift.\u00a0 Leading from the front to make everyone understand that Digital Transformation is a very serious and important endeavor.<\/p>\n

      CEOs must have the will and resolve to challenge incumbency, obliviousness, and existing state of affairs.\u00a0 While remaining firm on the strategic direction, CEOs must be flexible enough to experiment, learn, and adjust course.<\/p>\n

      Interested in learning more about Digital Manufacturing?\u00a0 You\u00a0can download\u00a0an editable PowerPoint on Digital Manufacturing here<\/strong>\u00a0<\/a>on the\u00a0Flevy documents marketplace<\/a>.<\/p>\n

      Do You Find Value in This Framework?<\/h2>\n

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      \u2013 Roderick Cameron, Founding Partner at SGFE Ltd<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

      Digital Transformation in Manufacturing, or Digital Manufacturing for short, is a matter of survival now for manufacturing concerns.\u00a0 Manufacturing companies desirous of survival have no choice but to hop on the Digital Transformation bandwagon, rapidly. Business Transformation of any kind is not an easy endeavor.\u00a0 Change Management of Digital Manufacturing is typically more difficult than… Digital Manufacturing<\/span><\/a><\/p>\n","protected":false},"author":110,"featured_media":9682,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","footnotes":""},"categories":[84,82],"tags":[2667,1535,2669,228,2653,917,2666,2668,30,1074],"class_list":["post-9675","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-information-technology","category-operations","tag-business-model-over-technology","tag-business-transformation","tag-ceo-driven-digital-transformation","tag-change-management","tag-digital-manufacturing","tag-digital-transformation","tag-digital-transformation-in-manufacturing","tag-independence-of-digital-operations","tag-manufacturing","tag-organizational-design"],"_links":{"self":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9675","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/users\/110"}],"replies":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/comments?post=9675"}],"version-history":[{"count":8,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9675\/revisions"}],"predecessor-version":[{"id":9686,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/posts\/9675\/revisions\/9686"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media\/9682"}],"wp:attachment":[{"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/media?parent=9675"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/categories?post=9675"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/flevy.com\/blog\/wp-json\/wp\/v2\/tags?post=9675"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}