Building Momentum for Digital Transformation of the Supply Chain

Digital transformation has become top of mind across industries, especially among manufacturing leaders. A 2023 survey found that 47% of manufacturing organisations have increased their digital-related budgets by up to 20% for the year, with more than half (59%) describing the digital drive of their organisations as “ambitious.” Leaders must now harness the momentum behind digital transformation to maximise their return on investment and smoothly integrate new technologies.

Communication, buy-in, and skill building are key to the successful introduction of digital tools and processes to a manufacturing environment.

Digitisation brings with it significant changes to processes and ways of working. Many organisations try to protect the workforce from the upcoming changes because they believe it will create anxiety.  However, a key element of success while executing transformation initiatives is actually sharing information openly and consistently. Lack of information sends more fear and prompts people to go into “survive” mode. While leaders may feel they are protecting their teams from change before it’s necessary, this “unknown” needs to be communicated to reduce silence and anxiety. If everyone is suspicious and senses something isn’t being shared, they could be distracted from their current work. By being open about changes coming down the pike, people will be more likely to trust that leaders are equipped to navigate the transformation.

Leaders must be strong communicators throughout the transformation to maintain buy-in and build momentum. They’ll need to acknowledge that in some places, humans will be taken out of the process, but those workers will still be part of that workflow, if in a different way. They’ll need to ensure that teams understand how their roles will change as they embrace digital processes like the internet of things, robotics, automated warehouse management, and innovative cross-docking.

Technology changes will provide a new level of connectivity across organisational silos. It’s critical to ensure that people are aware of what’s changing around them, as well as within their direct teams. Especially when it comes to the transition from a hands-on and manual role to one that’s more administrative in nature, people will need to understand how their efforts are contributing to the company’s vision and larger strategy. Initial pushback might not be from anger at the disruption, but from frustration or fear. By aligning teams on how each individual piece of optimisation works, the company can drive positive outcomes. It’s also important to celebrate wins along the way, to maintain momentum while encountering the natural bumps in the road.

As manufacturing facilities embrace process improvement through artificial intelligence, machine learning, IoT and robotics, many employees may experience a drastic shift in their day-to-day routines. While human jobs won’t necessarily be removed, they’ll be changing as automation increases. Hands-on workers will become knowledge-based employees, as they navigate new workforce management software, handheld devices, kiosks, geotags and other additions to the warehouse environment. Leaders will need to clarify how roles will evolve as a result. At the same time, there needs to be a well-communicated approach to reskilling and upskilling throughout the transformation. At an early stage, job- and task-specific workshops that benchmark new skills in the use of software and digital tools should be implemented. Rather than a broad tutorial for 12 different teams, leaders need to implement a team-by-team or task-by-task approach, to ensure the greatest relevancy to daily work. Leaders should draw on internal advocates at all levels of the process, and use them to train their peers.

A critical element to working through this transition is allowing workers to learn in a “fail-fast” and growth-focused culture. While there can be expectations of adoption and benchmarks to be met within certain timeframes, there needs to be a reasonable learning period.

The shift toward digital processes — whether it’s adopting IoT or putting robotics in place — requires helping people understand the nature of the initiative, why it’s happening, and what their roles will be moving forward. By clearly outlining what to expect, while providing the right tools to adjust to new roles, organisations can create trust and buy-in, and achieve their desired goals at every step of the way.

Kathy Gersch is chief commercial officer of Kotter.

Originally published on SupplyChainBrain

Building Momentum for Digital Transformation of the Supply Chain | SupplyChainBrain