Digital Transformation is the topic of every business publication from the Financial Times to theWall Street Journal, from Fast Company to Fortune magazine and is the keynote theme of every manufacturing related conference or event, vendor or organization sponsored. With all the talk about Digital Transformation, the inevitable question arises: Is it hype or is it real?
LNS Research has surveyed over a thousand industry participants over the last year and we can definitively say the convergence of the the Industrial Internet of Things (IIoT), Big Data and Analytics, Mobility, and Cloud technologies has precipitated an imperative to at least understand and prepare for the next phase of manufacturing and related asset-intensive industries enabled by the concept of Smart Connected Assets, which underpin Digital Transformation. Businesses that miss this crucial window of research and investment run the real risk of being left behind or displaced by more forward-thinking organizations.
Digital Transformation Impacts People, Processes and Technology
Technology is central to Digital Transformation and in some respects is both a driving factor as well as being driven by the process of engineering the Digital Transformation. Without the appropriate technology, many of the new business models we see resulting from Digital Transformation could not occur. Uber, the poster child for Digital Transformation in the personal transportation industry, would not be possible if it weren’t for the GPS-enabled smartphone. In manufacturing and asset-intensive industries, it is Smart Connected Assets that are the technology that underlie Digital Transformation. Without the ability to effectively manage operational risk associated with asset performance vendor provided service agreements or business models where an OEM delivers a service such as providing holes instead of selling drill and bits, would not be possible.
Likewise, technology, mostly in the form of mobility solutions, can enable people to manage and operate within these new business models. It is the combination of the new business models, the next generation of the workforce using the tools and technology they have grown up with, and the drive towards Operational Excellence that is finally enabling order-of-magnitude performance improvements as people can gain access to the right information to make decisions, at the right time. For the last 35 or more years, the goal of ensuring “the right people have the right information at the right time” has been more vision than reality with a patchwork of layered technology enabling information flow. These systems have been vulnerable to unsynchronized release cycles from a multitude of vendors and laborintensive, complex, manually driven analysis mechanisms that have made gains difficult to achieve, let alone justify.
Data Is at the Center of Digital Transformation & Smart Connected Assets
Data not shared is most likely data not used and how to best share data is a challenge for many businesses. Just following the old point-to-point approach of the past is no longer viable, not that it really ever was, not being cost-effective in many cases. The IIoT is more than just more of the same machine-to-machine (M2M) connectivity of the past. The IIoT is what is making it possible to move data, with low latency and overhead among any and all applications that might benefit from that data.
Of course data can can be overwhelming if it comes too fast and in too great a volume. Unique to Industrial Big Data is the volume, velocity and variety of data. This is why Industrial Big Data and the analytics associated with operational Big Data are critical to Smart Connected Assets. Processing the myriad types of data, from time-series data, unstructured, to semi-structured (as in a data historian), to structured and discovering the meanings buried in the pool of data is the enabling technology that makes new processes and business models possible. Cloud technology makes the challenge of Industrial Big Data manageable and it makes it globally accessible, and secure, if done right. It also means people capable of using these tools and interpreting the results they present is just as important, bringing Digital Transformation full circle, being a combination of People, Process and of course, Technology.