- By Renee Bassett
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Summary
Digital transformation—the integration of digital technology into all areas of a business to fundamentally change how it operates and delivers value—is a profoundly important concept for industrial businesses. It has been for years, and it remains a key enabler of a change in corporate culture that seems to suddenly have a new name: business agility.
You can thank software companies and IT departments for popularizing concepts like “the agile workplace,” “sprints,” and “a minimum-viable product (MVP) mindset.” Management consultancy McKinsey & Company calls agility “the greatest change in approach for a generation.” Buzzword hyperbole aside, automation engineers are probably already being agile as they make operational improvements, enhance run activities, contribute to long-term planning, and augment important safety standards.
Agility is a method of continuous improvement, a way of getting things done that removes friction or obstacles to the core processes. Agile also is lean. “Lean and agile ways of working complement each other, and the magic is in the combined recipe from both,” according to a recent essay by McKinsey on agility in heavy industries. “[B]oth systems have been successful across a range of environments, and both share a similar set of foundational objectives: transparently connect strategy and goals to give teams meaningful purpose; discover better ways of working to continually learn and improve; deliver value efficiently for a customer; and enable people to contribute and lead to their fullest potential.”
When run together, say the authors, “lean processes bring the holistic view and basic principles, while agile processes bring the flexibility of short-cycle implementations (sprints) for continuous improvement. The lean approach tends to be more applicable to continuous improvements, providing directions or outside-in solutions to the value stream as part of the daily operational routine. The agile approach can bring the alignment and transparency of objectives to combine the expertise from the shop floor with short-cycle improvements.”
Leading companies are applying both lean and agile thinking to use digital technology to quickly improve both operational efficiency and business outcomes. McKinsey cites detailed examples of agile thinking and working practices at BP and at Freeport. Last month’s InTech cover story described the ARC Advisory Group’s “Digital Transformation Top 25,” the consultancy’s list of agile companies that have shown substantial progress in transforming their cultures.
ARC’s top five companies are Tesla, Intel, BMS, Johnson & Johnson, and 3M. The community will be celebrated at ARC’s 26th annual Industry Forum, postponed from February and now being held 6–9 June in Orlando. Petrobras, another digital transformation leader, will be sharing its challenges and successes at a new ISA-created virtual event, Digital Transformation—Brazil on 29 March.
McKinsey advocates “the value of being agile as distinct from doing agile” and encourages developing “a shift of mindset from certainty to discovery, control to collaboration, and scarcity to plenty.”
Is that a transformation you and your company have taken on? Talk to me about it via rbassett@isa.org.Reader Feedback
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