Digital Transformation – new PLM sales buzzword?

The new trend – digital transformation is here. You can hear it everywhere. New “digital processes” enabled by new technologies and tools are replacing old ones. The term transformation refers to a fundamental change to an organization day-to-day business from the type of products to types of services companies are delivering. In order to leverage full potential of new technologies, organization should change in its core behavior and use new digital technologies. It is a big opportunity.

I found interesting that “digital transformation” trend is used to explain why organization should change the way organization is doing business. Navigate to the following Siemens PLM blog article – Digitization vs. Digital Transformation in MedTech. Here is my favorite passage that speaks about digital transformation as a way a comprehensive end-to-end produce lifecycle:

When we talk about “digital transformation,” think of this: Change. Digitization does not really change anything about a process, nor does it create efficiencies. It certainly does not connect the entire product lifecycle in order to gain transformational efficiencies, look at quality from a holistic perspective, nor garner intelligence that can only be achieved by analyzing data across functional disciplines and spanning multiple processes.

Digital transformation is comprehensive, with an enterprise scope. It takes an end-to-end-and-back-again view of product lifecycle, an information loop that connects all the pieces of innovation, quality, and efficiency. Its vision is to gain true intelligence and deliver it to the point of action, where impactful decisions can be made that truly advance the value to the consumer, in a timely and high-quality manner. That means data must be collected in a way that makes it accessible and meaningful, captured at each dimension of the design, engineering, and manufacturing process.

Collecting and centralizing data, end-to-end product lifecycle, glue intelligence, organizational changes. I felt like I’ve heard all these things in the past. It is usually was a main theme of PLM implementation – change management and business transformation. Few minutes of Google and I found great examples how PLM was making a point for business transformation as part of PLM implementation process.

Jos Voskuil’s blog from 2013 – PLM is  journey is a great summary of how PLM was using “business transformation” to explain the need of companies to change.

Why no fast approach for PLM ? For PLM, there is no fast approach as there are so many areas that you can address? Too many jobs – remember my previous post? In addition, the exact meaning of all these jobs is not clear from the start.You have to prepare for a journey. And here is the main challenge. Management will not easily fund your journey as you cannot explain it specific results in comprehensible words to them. Management might be excited by the proposed value of PLM. Who does not need to be more competitive and innovative in the future? This message resonates particularly well among members of the board and shareholders. But when it comes to implementation, there is usually only one cross-disciplines unit that can accomplish this assignment: the IT-department. And here is the crucial mistake discovered time after time where PLM implementations fail. PLM is a business transformation, not an IT-system implementation.

What is my conclusion? Digital era brings new terminology – digital transformation. Very tasteful and nice term. I love it as much as I appreciate the power of new digital technologies developed for the last few years. However, be aware how old organization change management and business transformation is sold under the new name – digital transformation. It doesn’t mean your organization should reject digital transformation. Exactly opposite. Organizations must embrace digital transformation as an opportunity to bring new more efficient technologies and products that can eliminate business transformation with the purpose to adopt old, complex and fragile PLM platforms. Just my thoughts…

Best, Oleg

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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.

Picture credit Bryan Mathers