Kimberley, when you are asked to describe what industry 4.0 will mean to manufacturing, how do you respond these days?
As you know, manufacturing has moved into the age of digitalization. In order to maintain or gain a competitive advantage, both large and small companies have to exponentially change the way they currently operate. That means no more manual data collection, no more lagging, week-old performance data, no more PowerPoint presentations [and Real-time, digital dashboards instead.] That means no more hidden factory. It also means real-time, digital data at your fingertips. It means that you are now able to understand impacts of your decisions before they are made. So you understand the impact on the business, and you understand the impact on the value stream.
Would you mind reviewing in this discussion the main lessons you and your team have learned?
I would say the key lesson we learned is that businesses must own the transformation process. They must own the problem and current-state gap assessment. They must also own defining the future-state requirements. They must also own the fact they don’t know what they don’t know. And we have to seek out industry experts to help us on the journey.
If you had to choose two or three main challenges you faced, what would they be?
The first main challenge would have to be the divide that exists naturally between operations and IT. IT has always been the scary man behind the curtain, so to speak. They have always operated autonomously, which caused that natural rift and divide with operations. Operations often struggled with the solutions provided by an IT organization because they didn’t really garner the ownership or the input from the business. Today, we are trying to close that divide, and the business is getting a stronger voice with respect to what their requirements are and what solutions best fit those requirements.
Human capital and change management is another big challenge. They are typically forgotten or pushed aside to expedite. But you can’t lose track of the human capital and change management piece of this because if you don’t have buy in from the shop floor to the top floor, it’s very difficult to execute, no matter how good your plan is.
You’ve obviously got that at Pratt, or was it there before you started?
We are working through the challenges. We were able to identify that and then develop workarounds to make sure we closed that gap.
The third challenge is the organization has to be able to define the solution; the solution can’t define the organization or the requirement. Too often, when you have a solution that defines your business process, it turns into a very constrained business process.
How did you solve those challenges?
You have to be persistent and consistent in your messaging in order to gain the critical mass needed to influence change. I’d say influencing the influencers is also something I relied heavily on—understanding who I could influence who could influence others in order to gain that critical mass. And then developing an incremental, quick-win strategy that the team can rally around and support.
When you say influence the influencers, do you mean only inside your own firm? Or were there instances where there was someone influential outside the company?
I had to understand who the influencers were within the company. But as I went on my smart manufacturing/digital transformation journey [attending and speaking at SME seminars], I was influenced by some of the influencers, as well.
You have spoken at smart manufacturing seminars about a “complete value stream approach.” Can you describe that briefly?
If you look at the typical industry today, manufacturers are key cogs in a value stream. And the value streams are very complex and global. So, whether you are a small supplier feeding a larger value stream or the value stream owner, it’s important to understand that we all play a critical role in getting product through that value stream and tying it all together in one, seamless digital thread.
Who or what helped you to understand and define your digital transformation strategy?
That’s easy. I’ll start with Industry 4.0. After attending my first smart manufacturing seminar [by SME], I was able to put a name to my vision: That name was Industry 4.0. I was also able to meet others who shared that same vision and same challenges. I was able to connect with my peers and understand that there was a small group of us who are on the forefront of digital transformation. It validated a lot of my assumptions and helped me refine my vision, in order to develop a comprehensive strategy and roadmap on how to embark on this journey. And it helped me grow as a leader and subject matter expert in the space.
Is the roadmap you just mentioned lasting, or do you have to come up with a new roadmap?
Because Pratt & Whitney is a very large, global company, the roadmap covers multiple sites in multiple states and multiple countries, and it is ever-expanding. So, it’s a long-term strategy roadmap.
Do you encounter more people who need the basics explained, or is the sophistication level growing so that you are encountering more people who need to figure out the next phase?
I would say it is a mix of both. Anytime there is a disruptive force in the industry, like digital transformation and Industry 4.0 are, there are typically three categories companies reside in: The visionaries who lead the disruption; those that follow once the path has been identified, and those that simply wait and see. As rapidly as Industry 4.0 is advancing, if you are not a leader or a follower in this space already, the gap can prove insurmountable for those in the wait and see group.
After a concerted effort to get on the smart manufacturing path and feel secure there, as you have done, what is involved in the next phase?
If you can imagine a fully implemented digital transformation, into one seamless, digital thread that connects your enterprise, complete from customer requirement all the way through to customer delivery—where we are well on our way to having cutting-edge technology that supports it—I would say the next phase is understanding how that impacts your organization.
The way I see it, Industry 4.0 is not only demanding we change the way we manufacture; it is also demanding we change the way we are organized and structured. I see IT and Finance and other support organizations becoming an inherent function of the business and no longer a separate support organization.
If you think about it, with ridiculous amounts of data being real-time and systems being self-learning and continuously optimizing and the next generation of our workforce knowing more about technology than most of us in the room today, and expecting the workplace to be just as advanced, we all need to recognize the need for an organizational seismic shift. For example, I would say Finance would simply become part of the solution and not an organization anymore; IT would simply become the medium in which data is collected, analyzed and displayed, not a separate organization.
What differences do you see, if any, between the phrases Industry 4.0 and smart manufacturing? Why might it be important to draw distinctions?
The way I see it, Industry 4.0 has significant historical implications. Twenty years from now, you and me, we will be in the history books. Our grandchildren will be learning about how Eli Whitney and Pratt & Whitney revolutionized the industry. We are a catalyst of that revolution. We are writing our own history, and that is a very big responsibility.
Smart manufacturing, on the other hand, is not only building but providing the roadmap on how we revolutionize, which will define the success or the failure of Industry 4.0.
How different are the challenges for large versus smaller companies?
It is important to understand that the challenges and goals are all the same, just a different size and scale. Whether you are a Fortune 500 company or a small mom-and-pop shop, we all play a significant and complimentary role to each other. We are both equally dependent upon each other to be successful. And only by embracing the Industry 4.0 digital transformation together can we truly revolutionize the industry.
What about the ‘democratization’ of manufacturing? How can smaller manufacturers see themselves in the catbird seat?
As rapidly as technology is advancing, so too must our supply chain and value streams advance.
As the saying goes, “We are only as strong as our weakest link.” By partnering with, investing in, and growing with all the key contributors, especially the small contributors, we can all gain that elusive competitive advantage. The way I see it, small manufacturers now have a permanent seat at the table and are driving the Industry 4.0 revolution, right along side their larger counterparts.
If you can give a single piece of advice to others in your position, what would it be?
Change is hard and scary. And new ideas very often are not well received, often making [leaders] uncomfortable. Be persistent, consistent and informed. The future of our industry depends on it.
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