Leadership for Digitalisation

Today many companies are thinking about Digitalisation. Many of them are starting with implementation of an ERP or developing an ERP or buying an App like Zoho and so on. Some companies are more adventurous. They try to collect more data from their machines and automate the data collection as against the manual collection of data. Some companies are going for a fully automated factory when they set up a new factory. While these companies are getting their feet wet and trying to go digital in their own way, many companies are not attempting the Digitalisation in the right manner and hence they are not getting much out of these Software implementations or modernization drives. Even the companies that have implemented the totally automated factories are not able to take the best out of their investments.

Indian companies have definitely progressed in their thinking in the past 2-3 years. They are positively looking to start initiatives to digitalize their operations. But it would be good if they can Learn about pitfalls in this area and adapt some Best practices. Let us look at both these aspects.

Some of the Pit falls that the companies have to look out for are as follows:

01.??There is no goal for the Digitalization: The whole initiative is seen in a very splintered manner. The projects are attempted in a very splintered manner and there are generally no goals fixed. A Company may be trying to implement ERP. But they would not have set any particular goal for the ERP implementation. With this, there is no general direction for the whole project. Even if a Company is setting up a totally automated factory, they are not defining the goals for the new factory. They are not ambitious about what they would like to achieve in the new factory. Hence, they do not know whether they are progressing well. Many of the projects are taken up by a I.T head of the Company or a Maintenance head of the company and so on. Digitalization cannot be treated this way. It won’t yield best of the results.?

02.??Need for change is not accepted: The employees across the company will have to approach their work in a different manner with the Digitalization kicking in. While we want to Digitalize, are we able to think about the amount of change that it will cause across the organization? If you are implementing an ERP, then your teams will have to complete all the tasks on the ERP then and there. They cannot accumulate work and do it once in a while. Earlier there was no need and the organization was never ‘online’. But now the organization must come ‘online’. If you are collecting a lot of data through Digitalization projects from shop floor, then your team has to learn how to use this data. Earlier they were never having a lot of data or even if the data was there in the PLCs of the advanced machines that you may be having, no one was looking at that data. Now, they have to learn how to change their way of working with this data incorporated into it. If this change is not anticipated, articulated and teams are not prepared, then the teams are not ready for the change. Some organizations do feel in their gut that they have to change. But they may not be still able to articulate the change that is needed. If no one is able to imagine this change on the ground, then you cannot prepare for it. This is a major challenge for all companies. How far can they reimagine themselves and their work??

03.??Users can’t slow down to understand their own processes: When you ask your team to write down the Standard operating procedures for all the works that they do, you would realize that 95% of them do not know how to write an SOP. That means they are not able to monitor how they are doing a particular work and much less are able to re-engineer it. When they can’t understand their own processes and not able to articulate them, then they cannot re-engineer their work. This is a very simple yet very serious problem. Teams need to be trained for this. Many companies just expect the users to be able to redefine their processes. Whereas this does not happen well at all. You would be surprised to see how bad teams are at defining their own work.?

04.??Working together as team: All the users from various functions will have to work together to define the processes well. A Sales process is not exclusive to Sales department. Finance would be interested in it, Production would be interested in it. Stores also may be interested. All the three functions will have to get involved in defining it along with Sales. Most of the Projects see the Functions defining these processes individually and then the other functions will start protesting once they are implemented on the ground. Most of the companies fail to make the teams work together while defining and implementing the improved processes in an ERP or in a Digitalized environment.

05.??Leadership is not inclusive: The leadership for Digitalization projects have to be inclusive. Usually, the Leader is one of the Functional Heads like an I.T head or a Maintenance head or a Production head and so on. These Leaders are not trained to involve the whole organization and drive a Change project. Resultantly, their limitations define the outcome of the Projects. Often times, even the company head may not be able to provide the Leadership needed for the Project. Good Leaders will seek outside help and let the outsiders lead the Organization into a new orbit. Some leaders are not able to do it well.?

There can be more pitfalls. But the above are the most important ones.?

Let us look at some of the Best practices that you can adapt while implementing a Digitalization project in your organization:

01.??Define a lofty goal for digitalization: You have to view digitalization as an opportunity to redefine your Business. It has enough capability to let you re-engineer your business totally using various elements of Technology that are available.??Through Digitalization, you need to re-engineer how you serve your customer with your products and your services. You need to conduct several Re-engineering Workshops with your employees, and you can seek help from outside to stimulate discussion. The goals you set for your company should demand the help of Digitalization. If there is no need for using the technology, then you may use it by force. But that won’t take you anywhere. Some of the goals that I would define for an organization will include the following:

a.?????Improve your profitability by 50% in three years.

b.?????Double your Top line in next 3 years.?

c.?????Double the Productivity of your employees in the next 4 years.

When you set such targets, then the teams will strive to use the technology to achieve the goals. Lesser goals may not demand any technology usage at all.

02.??Define stages of implementation:?While you define a lofty goal for the organization, you should not try to do all of it in a short period. It is not about technology. It is about the teams and their ability to change and learn new ways. This will take some time. Hence, we need to take the organization step by step by holding their hand and taking them from one step to the next one. We have to be patient with the progress. The focus should be in bringing in all the employees. The temptation will be there for Companies to drive the initiative with a few people and try to force others to follow suit. But this will fail in the medium term or it will create a a lot of disruption in a company. This will be costly for the company. The Leadership should always look at taking everyone along. Even if this means going slow.

03.??Put a full-time team: Establish a full-time team for the Re-engineering of your Business to achieve the big goals that you have set up. When you are trying to re-engineer the way you are doing business, it is a big deal. You are looking at achieving some superlative goals. It does deserve a full time team of the BEST people from your organization. Usually, the functional heads will hesitate to nominate their best people to this team. But this is too short sighted. The Leadership should motivate them??to nominate their best and ensure the team that is put together is the best in the company. This team should work full time on the Re-engineering project. Part time is simply not acceptable. You cannot re-engineer your business with a part time effort. It is not possible.?

04.??Create a collective leadership: While there can be a leader for the full time team, the Company management should strive to create a collective leadership for the initiative. This can be done through the formation of a Steering committee. This steering committee should be empowered with several responsibilities as well as authorities. The team should feel powerful. This is in the interest of the Company. The Company leadership should strive for this. The Digitalization projects typically require a cross functional working. A Collective leadership will enable this. As against this, if only one strong leader is there, then the other leaders will not be too active. They will give up the control to the other Leader and they will not think as if they are in charge. This will put too much responsibility on one Leader and more importantly it will shut down the other leaders which is not good for the company.?

05.??Run a Leadership program along with the Change initiative: It would be good to take up a Leadership program for the top team in the company. Top team may include the important leaders from all layers in the company. Having leaders from all levels will help in supporting each other while implementing the change. Each leader in different layers would know what the other person is talking as he is also going thru the same program. The Leadership program should aim at helping Leaders to improve themselves as needed while they are going thru the Change program. Unless the Leaders transform themselves, it is not possible to transform the company.?

06.??Measure progress objectively: Define Metrics with which you are going to measure the progress of the Initiative. These metrics may be Result metrics or Process metrics. The Leader should define these Metrics and then generate the data periodically on these metrics. The reports should be shared with the concerned team regularly. This will certainly motivate the team. Even if the result is not good, still the team will work in a focused manner to improve the particular results.?

07.??Create an enabling environment: Create a motivating and enabling environment in the company. Recognize good performance. Introduce good Organizational rituals that will create good working culture in the company. For example, a practice of celebrating failures will create an environment of tolerance towards failures. A practice of Technical paper presentation by the Engineers in the company will create an environment of Technical study and technical orientation of employees. This way, the company should identify and implement Organizational rituals that will promote a good culture in the company.?

There can be more best practices. But the above are important ones that can help an organization to succeed in a Digitalization drive.?

How are you driving the Digitalization drive in your company?

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