One of the key learnings from implementing our internal digital transformation was that it is critical to formalize your vision. Now is the time to think BIG. Identify and pick up your quick wins. Then, scale those quick wins through a digital transformation office to sustain momentum. Finally, assess and build capabilities from Day 1 across business units and P&L centers. Here are some additional key learnings from GE Digital’s journey that can help lay the groundwork for success along your digital industrial journey.
- Recognize the importance of target capabilities, and think about systematically incorporating them in transformation.
- Emphasize cross-functional and business unit coordination. Developing robust capabilities involves new talent (supported by HR), new tools (IT), new processes (operations), and new governance (leadership).
- New capabilities might represent a huge shift into the unknown.
- New capabilities call for fundamental change in behavior
Riding the maturity curve
Remember, capabilities are one key aspect of a digital transformation. Let’s focus back on the 30,000-foot view of the outcomes driven by the adoption of digital techniques, and the increasing maturity and impact of the transformation. We encourage all businesses considering a digital transformation roadmap to start with the same early focus: driving productivity in existing operations.
By focusing on delivering tangible ROI today through productivity improvements, you get three things:
- The ability to self-fund the next step in your transformation journey—such as new product introductions.
- The first steps in building-out the operational agility needed to innovate at the business model level.
- The ability to build early internal champions, and the momentum needed to drive more radical transformation.
Building credibility is the key to any successful transformation. Internal productivity is much easier to achieve than being “the next big thing” outside of the four walls of your company.
With the data, insights, and improvements from these internal wins, you’re now in a credible position to take those same productivity improvements to your customers, in the form of best-practice sharing, or even as new products and services. This is what we have done, and it’s part of GE for customers.
Once established, and you have a repeatable line of sight into the outcomes you’re able to achieve, you are in a position to start the dialogue around new business models that leverage this data and connected infrastructure. These lead to marketplace concepts like application economies around your offerings.
The different maturity levels of your digital industrial transformation will involve a sustained focus on capability development to take the successes and scale them.
The capabilities that will be foundational, competitive, and innovative at each level of maturity are different. Organizations striving for differentiation should continue to keep a capability focus, and effectively manage change to build those muscles.
Finally, organic development, investment, and acquisitions have traditionally been strategic levers that organizations can pull to enhance capabilities. In today’s world however, where open innovation has come of age, focus instead on building key partnerships that can help you close your capability gaps faster to ensure maximum effectiveness.