Operations and maintenance isn’t oblivious to digital technology . However, in recent years the rate and scope of change has skyrocketed due to disruptive technologies.
Those in the industry face greater competition and users expect much more. As a result, many companies find they must recreate how they operate, service, and maintain equipment and manage facilities.
Nonetheless, most companies do not have a clear idea of how they should approach digital transformation. They treat every symptom that pops up, but ignore the big picture.
Unfortunately, slow, fragmented efforts cannot counteract disruptive technologies because they can affect every aspect of business. From client interactions, to service and maintenance routines, and even the physical and operational fabric of operations may all need immediate and dramatic change to remain relevant.
New Digital Mindset
Operations and maintenance must adopt a new mindset and become digital industries. It simply isn’t enough to treat the symptoms of a problem area when a more holistic strategy is needed to address the problem.
Clearly, the need for rapid digital transformation is imperative for survival. Accordingly, it must be planned and approached wisely. Nevertheless, it does challenge the traditional business model. Stakeholders need to raise their risk tolerance level to explore and test innovative solutions.
Digital transformation can affect operational efficiency, value propositions, the customer experience, and the core of a company’s business model. It can also present significant security and regulatory compliance challenges, but it is possible to overcome these challenges to institute valuable, necessary change.
Progressive industries are already using innovative solutions to implement new processes and services, increase efficiency, improve safety, meet compliance, and reduce costs. Operations and maintenance can embrace digital transformation too.
Certainly, organisations cannot expect to succeed if they continue to play the same game. Digital disruption has changed the rules.
Firms need a solid strategy to help them bridge the gap between their resources and new technologies that can solve their problems. This shortens lead time and lowers the cost to implement innovative solutions.
O&M Challenges & Opportunities
The pandemic has certainly posed countless challenges for operations and maintenance. Facility shutdowns, supply chain interruptions, and work-from-home limitations continue to strain companies and the global economy.
Some firms embraced digital transformation and found new propositions in the marketplace. Others scrambled, failed to adapt quickly and suddenly found themselves facing increased market pressure. Many still struggle and the bitter truth is companies that rely on their old value propositions may not survive. Plus, in the wake of COVID-19 all companies will face more regulatory pressures with an increased focus on safe workplaces and interactions.
Pandemic-Driven Positive Change
Nonetheless, the pandemic has also changed the dialogue within companies, refocused efforts, and revealed unexpected opportunities. Fortunately, some companies have made bold choices, explored disruptive technologies, and gained a competitive advantage. For instance, using technology to create a more agile supply chain increased competitive edge.
Operations and maintenance has also used technology to improve health and safety in the workplace and in client locations. Many companies now use apps to monitor social distancing, log movements, and minimize duplicate calls.
In recent years, one of the most critical developments in the industry has been in cost avoidance. Maintenance teams use technology to detect minor problems before they become major issues. Equipment sensors can immediately send out an alert when a fault occurs that could lead to a problem.
Additionally, technology helps companies avoid costly downtime, overtime, and idle time by coordinating efforts. Companies can meet orders with less effort, cost, and sometimes with fewer materials. Economy of scale can lead to huge discounts and less wastage. Businesses are better able to track tools, supplies, and spare parts to avoid emergency shipments, duplicate purchases, and shortages.
Finally, stakeholders are more likely to invest in technology when they can see how it can save the company money. Technology makes it possible to set up operational and maintenance KPIs as a percentage of replacement asset value.
How is the Sector Adapting?
Industry leaders are adapting at a blistering pace and have adopted new trends in operations and maintenance routines. The most successful companies leverage digital technology to build agility, improve customer focus and efficiencies, and reduce costs.
Undoubtedly, some mature technologies are perfectly suited to operations and maintenance. Many companies have successfully adopted artificial intelligence, virtual reality and augmented reality, cloud computing, robotics, predictive maintenance, big data analytics, mobile, and digital twinning into their business model. These have demonstrated a measurable return on investment, but more importantly they have positioned forward-looking companies as leaders.
Furthermore, cutting edge technologies will eventually bleed into the consumer sector. As more users understand these technologies and experiment, it will be even more important for companies to keep pace as this will undoubtedly lead to further digital disruption.
Google operates in 50 countries and has thousands of locations within each region. They’ve adopted a new approach that fundamentally changes the way they approach customer relationships and their workforce.
Through new technologies, they allocate job tickets to their countless data centres based on the quality of work and cost, skills needed, and available persons within their teams. They also have a Google Chat service that lets workers know if they’ve gone to the wrong location.
Once the worker completes their work, the data is used to plan their network growth needs. The system improves customer service and operations and reduces maintenance costs.
Simultaneously, Google collaborates to solve pressing problems. From initial concept to final deployment, solutions may take as little as five days.
Johnson & Johnson Vision Care
This U.S. based leader digitally connected its value chain end-to-end (E2E) from suppliers to consumers which resulted in double-digit sales growth. Their modular platform allows for rapid line reconfiguration, reducing development and launch timeline by 30 percent.
Moreover, industrial internet of things (IIoT)-enabled advanced process automation also led to double digit cost reductions. Their E2E supply chain visibility platform reduced inventory levels by 13 percent.
This Brazilian company is a floating production systems supplier and considered a technology leader in the offshore oil and gas industry. They rely on advanced analytics for predictive maintenance, which reduced lifetime downtime by 10 percent. Their digital twin of their process plant reduced downtime by 65 percent in the first year.
Furthermore, artificial intelligence has been used to accelerate digital scaling across its fleet for a sixty-fold increase in productivity. Organizational health has also increased 20 percent due to their enhanced people performance management system.
Japan continues to embrace technology and Hitachi sets the bar in manufacturing. They have incorporated a digital operator management system into their business model that cut their production lead time in half. Their equipment performance system has increased capacity by 30 percent.
Additionally, their industrial internet of things infrastructure for control system has led to over 4,000 apps for engineering, production and maintenance operations. They also employ digital twins of customer systems for a 70 percent increase in their inspection efficiency.
Obviously, these case studies show how some companies have invested heavily in new technologies and scaled their successes. As a result, the gap between these front runners and most others continues to grow wider. Those that lack foresight and still cling onto old methodologies could find themselves out of the game. They need to use technology to create a customer-centred design and to seamlessly connect across the organization and the broader supply chain if they are to remain relevant.
Companies seldom have a well-crafted plan that identifies challenges and matches them to potential technological solutions. They do not realize that many technologies already exist and these can be adopted by their business simply and affordably. Fortunately, that needn’t be the case.
Emergence of Private Digital Services
Many companies and public sector organisations are often firmly entrenched in bureaucracy, antiquated policies, siloed data, and slow processes.
Data is frequently scattered amongst uncatalogued or poorly organized paper and digital files across many departments and sometimes in personal email boxes. Files are sometimes lost or left unsorted in dusty boxes in abandoned storage rooms in forgotten basements.
This makes it almost impossible to aggregate and search data, fully understand a problem, test solutions, make informed decisions, or gather feedback on decisions made.
Unfortunately, this will not serve today’s customers or citizens. They demand instant access to data and a wide range of mobile, personalized services – anytime, anywhere. When the public sector or a company cannot offer this, they may need to seek out private digital services to fill these service gaps.
Until recently, this remained a largely untapped resource. Companies and governments often relied on the lowest denominator tools rather than the most beneficial. In some cases, leaders may not even realize they have more affordable, more comprehensive options. They just rely on the same tools, because it’s the way they have always done it.
Undeniably, the benefits of using external resources are too great to ignore. Unified systems can be implemented across all departments for unimpeded data flow. Technology can provide new services and delivery models quickly and efficiently, something desperately needed during and after the COVID-19 pandemic.
Regrettably, government and many businesses fail to capture the value of technology due to fears surrounding security and compliance risk. Others sit by as the competition overtakes them, because organizational complexity makes it impossible to find solutions in-house. Luckily, solutions can often be found by partnering with expert private sector partners.
Clearly, business and government can move quickly with the right motivation. However, creating sustainable, meaningful change requires more than lipstick and mascara. Organisations need to create new operational and maintenance methods, more effective services, and best-in-class relationships.
By matching challenges to potential solutions, it is possible to deliver what clients and citizens need and blend these into current business models.
Key Digital Transformation Themes
The pandemic altered attitudes towards work-from-home forever. According to a McKinsey Global Institute report, around 20 percent of work can and will be done remotely in the future without decreasing efficiency.
Work such as coding data, information gathering and processing, training, and communicating with others are the most likely activities.
With data distributed among multiple systems, remote work, and global supply chains, cloud enterprise resource planning systems will become the new normal for operations and maintenance.
This connectivity also increases the need for greater cybersecurity to offset risk. Organisations will need to better protect data and systems in response to new security challenges.
Cybersecurity must become a top-down effort with information technology (IT) and operational technology (OT) departments working together. The threat is real and can exploit operating system vulnerabilities and critical data, shut down production lines, interfere with distribution and services, and trigger costly ransomware demands.
To add to business complexity, organisations must also implement digital transformation solutions and organizational competencies that increase agility to remain competitive. Rigid, hierarchical constructs of the past cannot provide the quick response and fluidity companies need as they move into the future.
Organisational effectiveness will depend on massive transformation. This could include adding cutting-edge technologies, re-organizing operations, and altering business models.
Decision makers should not rely on internal competencies alone. Disruptive technologies have changed the playing field and will continue to do so. Business needs to respond with alternatives to their traditional systems. They must take charge of transformation, craft strategies, test options, and measure results. This may cause them to revisit their outdated, ineffective governance models too.
Of course, experimentation is outside of the usual corporate business model that scales up known winners and downplays less successful efforts. Nonetheless, risk tolerance levels must increase if organisations are to find effective solutions to new challenges.
Unquestionably, companies will need to find new ways to identify risk and measure their ROI through unconventional methods. They will also need to dedicate more resources towards change management as technology can affect the core of the company’s operations and organisation.
Creating a Digital Transformation Strategy
Ad hoc technological change will not address pressing needs or fulfil corporate long-term goals. Companies need a clear roadmap for effective transformation as it affects processes, people, and the tools used to accomplish business.
Digital transformation requires a three-pronged approach. Firstly, the company must articulate its vision for the future. This vision is then linked to business strategy and goals. This is important, otherwise companies tend to get caught up in the latest technological trends, rather than what serves the company well.
The abstract nature of innovation makes it important for leaders to articulate concrete strategies and decisions which offer value and address risk. Additionally, many companies will struggle to identify which technologies are most beneficial to their organisation unless they have expert advice. This includes calculating costs and savings that aren’t always evident. As an example, supply-chain integration could lead to substantial savings that offset initial costs.
Partnering for Success
Secondly, organisations need to work with an experienced, trusted partner to evaluate new and disruptive solutions and whether they can easily blend into operations. Understanding all costs and issues also makes it easier to present a solid business case to stakeholders to spearhead technological transformation.
Assess Current Capabilities
Thirdly, companies need to assess their current IT and OT systems. They may need to be upgraded to support new initiatives. By leveraging external technology providers, companies can create a scalable and flexible IT stack. Organisations may choose to outsource, partner, or acquire resources through established providers, startups, and technological ecosystems.
All successful digital transformations put people at the forefront. A cross-functional governance team and more flexible structures can ensure quick executions.
Commitment from Management
Finally, top management must be committed to change and be willing to explain why this is needed to the organisation, then support and drive the process. Leaders must identify skills gaps and encourage additional training for existing employees to fulfil and advance these roles. They must also identify and quickly address new opportunities that arise from the changing business landscape.
Most importantly, the organisation must be willing to explore new ways of working and provide the tools needed for success. This may include creating more flexible policies and procedures, encouraging employees to suggest new ideas, and testing many novel ideas to discover what works best. Partnerships are often the best way to identify robust innovation solutions, realize innovation ambitions, and find budget value.
The EarlyBirds Advantage
Organisations have many options available for technological transformation. Regrettably, many companies still believe they can do this task in-house despite the fact their resources are already strained due to the pandemic. A better choice is an “outside in” approach.
External ideas and technologies can offer solutions outside of the slow traditional vertical integration. This approach involves partnering with experts for accelerated innovation and growth. With access to many innovations, some may address corporate challenges immediately. This can reduce costs, accelerate time to market, increase differentiation, and even create new revenue streams.
EarlyBirds can assist the operations and maintenance sectors in many ways including:
- Identifying tangible innovation goals
- Clearly defining business challenges
- Naming strategic arenas that have been affected by disruptive technologies
- Creating a course of action needed to meet organisational goals
- Simplifying the pathway to outside in innovation
- Sharing our expertise, relevant knowledge, and know-how to enable decision makers
- Helping organisations evaluate available and new disruptive solutions
- Assisting companies in the transfer of knowledge between various regions
- Helping organisations in their evaluation and implementation of O&M concepts and practices
- Sharing relevant case studies, success stories, and best practices
EarlyBirds offers several programs to suit your business needs. Both offer expert guidance however the explorer program is a comprehensive, enterprise-wide alternative.
The Explorer program is designed to bring innovation to your entire organisation. It includes an enterprise-level subscription to the EarlyBirds Marketplace. This open innovation ecosystem of innovators is a valuable source of proven technical solutions for business challenges.
The Explorer Program also connects your business with an EarlyBirds dedicated Subject Matter Expert. Your SME is an industry leader with a proven track record of achievement. They work closely with your organisation to identify opportunities and match challenges with innovator solutions through skilled facilitation.
This program also includes access to weekly innovation boost webinars and monthly and quarterly innovation days depending on your appetite to act.
In turn, organisations can:
- Reduce their overall innovation costs;
- Increase capability where and when required;
- Access the best innovators and consultants;
- Move from idea to action quickly; and
- Simplify the process.
The Challenger Program helps you identify and tackle a single business challenge at a time. It is a great starting point for organisations that require immediate action. This is a short, highly-focused program of activities specifically designed for actionable innovation. It is suitable for companies that want to take the first step within the innovation transformation process.
An EarlyBirds Subject Matter Expert clarifies the parameters of your challenge, explores innovators, and identifies the best potential solutions. The SME presents your business with a roadmap highlighting the most promising for your organisation.
EarlyBirds has helped many organisations solve their business challenges through actionable innovation.
We offer a range of self-service and assisted program options tailored to meet your unique requirements. For more information, please visit our Early Adopter page which may answer many of your questions.
Do you need further information about our Explorer & Challenger Programs?
We make it easy to partner with global innovators. Let us help you transform your business through actionable innovation. If you’re interested in the benefits of disruptive technology, please read our post here.