What is digital transformation in manufacturing?
- March 14, 2019
- Posted by: Chase Gregory
- Category: Digital Transformation, Emerging Technology
Ran across this article on MIT Sloan Management Review written by Vijay Govindarajan and Jeffrey R. Immelt
It includes one of the better descriptions I have run across for digital transformation for manufacturers:
“A digital transformation entails reimagining products and services as digitally enabled assets; generating new value from the interconnection of physical and digital assets through data; and creating ecosystems to make that possible. And it results in a fundamental change in business and organizational activities, processes, competencies, and business models, enabling greater productivity.”
One of the biggest challenges that exist is hiring or upskilling current employees to lead the charge of this transformation. Why?
You need will need people who think differently about how to use digital to solve customer problems. These people will be found beyond your typical manufacturing IT person.
In the article they give a great example of how a digital transformation group creates new ways of doing business:
“Unlike IT professionals, digital leaders can weave their knowledge into the context of a customer’s business, helping the customer realize the commercial value of digital technologies. For instance, after analyzing data from customers, one of GE’s digital teams figured out that every wind farm has a unique energy-generation profile based on its location, landscape, and prevailing winds. Realizing the importance of that insight, the digital team worked with turbine engineers to custom design turbines for every wind farm. That increased each turbine’s energy output by 20% a year and generated $100 million in additional revenues over its lifetime — something most IT people wouldn’t have concerned themselves with.”
The rest of the article is quite good–give it a read: