Digital Transformation is in the air. Every company these days is transforming itself into a future digital universe. There are a lot of rational and important reasons why to focus on digital transformation. It brings new business models and unlocks new business opportunities. It helps to provide a better experience to customers and increase company profits. And it is a future.
I honestly believe in the digital future. Because our lives changed for the last decades of massive business changes in consumer technologies, travels, e-commerce and many other filed. This is what we do on an every-day basis. We don’t use maps, watch YouTube and disconnected cable channels. We check prices online before buying food in supermarkets and making travel arrangements using phones. Our kids don’t know what is file and they use online services for homework. We use the same web sites to check kids achievements and time tables. We don’t need maps when we travel, everything we need is a phone with an internet connection.
But, it took decades of changes and many incremental steps to do so.
Sounds familiar? I’m sure it does. Here is the thing… if you move to the business, the story won’t be matching gigantic leap as we made in our personal lives. Manufacturing companies are still running fax machines (even if they don’t, they are using tools that are very much similar to fax machines). And this is where the problem starts. How to get out of the past? There is no simple way how to do so. It is about transformation. Like in the picture below.
Manufacturing companies are part of this entire digital extravaganza. As much as I believe in the digital future, many businesses are not there yet. Any many businesses won’t make it. The devil is in details and it requires many changes in an entire organization of business – from using different systems and technologies to changing people’s behaviors and the way they do work.
My attention was caught by Jim Brown’s of Tech-Clarity survey results about how companies are changing themselves. The chart below gives you an idea of what is the conclusion. Here is a formula form the picture. Digital Product Innovation = Digital Twin + Digital Thread + Digital Innovation Platform + Digital Manufacturing. It feels and sounds like we are adding a magic “digital” word and everything is changing.
I downloaded the research. I cannot share the report here, because I want to respect Siemens Marketing that wants people to leave their dummy (or not) emails. So, you can do it by yourself using this link.
I found a few interesting passages explaining what is behind “digital” everything in the chart above. Here is a definition of Digital Twin:
From an innovation perspective, we define the digital twin as a virtual model of a physical item. The model represents a specific product, configuration, piece of equipment, plant, city, or other physical assets with enough fidelity to predict, validate, and optimize performance and behavior.
So, a digital twin is a virtual model of physical items. But we had modeled before – CAD model is a foundation of this model and many other data pieces added to this model like simulations and more.
Here is a definition of Digital Thread:
…the digital thread ties product information, decisions, and history together in a structured, integrated way that captures product innovation and knowledge throughout the product lifecycle. It establishes traceability from early in the front end of innovation through development and beyond. The digital thread approach also incorporates streamlined design creation by sharing and/or reusing design data across the stages of innovation. Design continuity along the digital thread allows designers to add their design information to a design model, directly incorporating and extending design data from prior steps instead of recreating design information.
Preserving a history of changes is a foundation of the PDM system. Extended more it comes as a system to manage the data about all stages of product development was a foundation of PLM for years (or how the document says “innovation”).
Digital Innovation platform combines these two activities – digitalize design data and process. (sounds very PDM/PLM-ish).
Digitalize Design Data Leading companies support product innovation with digital data. For the purposes of this research, we define “digital data” as data in a database that can be accessed by any application. Digital data does not include files that must be opened by a specific tool or data embedded in documents, forms, files, CAD models, or scanned data. Top Performers are 50% more likely to have fully digital design data than Others.
Digitalize Design Processes Digitalization extends beyond data to processes. We define “digital processes” as those that are executed based on computer-managed workflows and tasks. An example is managing engineering changes and approvals via digital workflows. Top Performers are over three times as likely to have fully digital design and development processes.
The definitions made me feel a bit confused. One one side, “digital” is a way to introduce new digital technologies to change processes. But if digital technologies have the same purpose and activity we had before (CAD, PDM, PLM…), then how we change process to digital?
What is my conclusion? Digital transformation is extremely important. At the same time, I’m very much interested to learn more is actually different in Siemens product that makes them “digital” compared to existing product Siemens was developing for the last 20-30 years. I believe an additional of “digital” word has some magic thing inside that I was not able to capture. I look forward to talking to Siemens people if they are ready to do so to learn more. Just my thoughts…
Disclaimer: I’m co-founder and CEO of OpenBOM developing cloud-based bill of materials and inventory management tool for manufacturing companies, hardware startups, and supply chain. My opinion can be unintentionally biased.