5 Mindset shifts required for successful industrial digital transformation
Digital transformation in the industrial sector is not purely a matter of swapping out on-premise servers for the cloud. It’s not just about replacing analog processes with digital technologies. It’s not about adding automation to every level of production. And it’s not about launching a product or technology that will transform an organization.
In fact, industrial digital transformation is as much about culture as it is about tech. It’s as much about the mindsets with which employees and leaders approach their work as it is about the products they sell.
For the last 20 years, we’ve been working side by side with Dickson as their team transformed the company from a powerhouse of analog environmental monitoring to a leader of industry 4.0. One reason Dickson’s digital transformation strategy has been and continues to be a success is that the entire team has embraced these five mindset shifts that have let it innovate on an ongoing basis:
Embrace data and analytics.
Prioritize customer needs.
Be willing to collaborate.
Strive for continuous improvement.
In this piece, we’ll take a look at each of these mindset shifts, showing how they manifest at Dickson and offering tips on how other hopeful leaders of the Titanium Economy can embrace them to see similar results.
1. Embrace data and analytics
For digital native companies, data and analytics are often core to the operation: decision making is fueled by data, leaders from every department lean on insights from business intelligence platforms, and everyone is working toward optimization.
For industrial companies (in the manufacturing industry, supply chain, logistics, etc.), though, the digital transformation journey is an enormous undertaking. Because many of these companies were founded before desktop computers (never mind smartphones), they’ve had to work hard to transition their core operations to modern technology.
One struggle many industrial organizations share is finding ways to not just collect data and analytics but to use those metrics to power decision making at every level of the organization on an ongoing basis.
Let’s take a look at how Dickson embraced a data-driven mindset as part of its digital transformation and how other organizations can do the same.
How Dickson embraces data and analytics
In the early days of our engagement, Dickson’s sales team wanted more insight into how people were using the company’s brand-new website: what were they clicking, how long were they staying on pages, etc.
Today, we take for granted that websites can and do collect those kinds of metrics––and that organizations will use them to power business decisions. Not so back then.
We worked with the sales team to understand the behavior of website visitors and used that to track which campaigns were successful. We tied orders that came in to both web activity and legacy catalog campaigns.
Crucially, we helped the Dickson team interpret this data and understand how to use it as a source of business intelligence to fuel decision making––about, for example, when to ease off catalogs and ramp up the web presence.
Over time, as the use of data and analytics became more universal, we recognized that these metrics were not just back-end utilities that could power Dickson’s own decision making; they were also potential features we could incorporate into the products Dickson sold to customers.
DicksonOne, the company’s flagship product, is a platform that enables customers to gather real-time data from wifi-connected monitoring devices and receive automated alerts when conditions hit certain trigger points (say, when a humidity reading gets unacceptably high in a warehouse storing metals). Not only that: customers can get these alerts to their mobile device, so that access to data and analytics translates to constant peace of mind.
Data and analytics takeaways
Ask your team what they need to do their job better.
Translate needs to metrics.
Build a data-to-insights toolset.
Empower decision makers with access to insights.
Make decisions based on data-driven insights.
Of course, this is all easier said than done. If you’re not sure how to, say, translate your team’s needs to specific metrics, consider working with an innovation consultant who has done this work before and can help you navigate the data analytics process.
2. Embrace change
One reason Dickson’s digital transformation has been successful in the last two decades is that the company has enthusiastically embraced change.
The classic fable about the oak and the reed helps explain why agile companies are better suited to survive periods of disruption: when the “winds of change” blow, large, rigid organizations are likely to blow over (or be seriously damaged), whereas flexible organizations (like reeds) bend in the wind but do not break.
So how can large, established industrial firms become more “reed-like” so they’re positioned to seize new opportunities? Let’s take a look at Dickson’s experience.
How Dickson embraces change
The Dickson of today is a very different organization than it was 20 years ago when we started working together. But it’s important to recognize that the company’s transformation has been gradual and ongoing––and those two things are key to its success.
Dickson’s team didn’t update one product and decide they were “done” with modernization. They recognized that their industry was entering an era of ongoing disruptions and that, if they wanted to be able to stay competitive and meet customers’ needs, they’d have to explore new ways of doing things.
Also important is that they started small, with the goal of solving a straightforward problem: understand what people were doing on their website.
That first change gave them access to a world of data and analytics that they then used to power ongoing changes and updates.
But not all ideas came from the data. Salespeople were consistently vocal about customer feedback, making product suggestions to integrated, cross-functional teams within the larger organization that included folks from TXI.
When our engagement started, a product like DicksonOne couldn’t have existed because the infrastructure needed to support it didn’t yet exist. But, because leaders and employees at every level continually accepted and embraced new technologies, Dickson’s current offerings cater to the needs of its customers today.
Takeaways for embracing change
Start small. No company is going to achieve, say, supply chain modernization in a year. Ongoing incremental changes are easier on people and organizations than huge drastic changes; a ubiquitous culture of accepting change can also greatly reduce the need for dramatic change.
Stay attuned to new technologies. The internet of things (IoT) and the industrial internet of things (IIoT) weren’t part of the conversation when we started with Dickson. But because Dickson embraced technology that paved the way for IIoT, the company was better positioned to embrace IIoT.
Listen to new ideas. Even if your company doesn’t yet use artificial intelligence (AI) or machine learning (ML), your customers no doubt have heard of these things. Your sales team may be fielding questions about them. The industrial firms that win in industry 4.0 will be those that see these questions (and any about new ideas) as a jumping off point to learn more.
Try new approaches. Traditional processes won't sustain modern operations. Paper charts (which old-school Dickson machines used) can’t achieve real-time internet connectivity. Not every experiment will work, but an organization set up to continuously experiment, learn, and move forward, will constantly be learning things that can lead to improvement.
Embrace experimentation. This applies to every part of the business: products, technology, pricing, business models, customer care, and beyond. Embracing change means practicing it constantly so that an organization doesn’t grow too large and rigid to adapt when conditions shift.
3. Focus on customer needs
Customer experience is a contemporary buzzword for something businesses have cared about forever. Today, many industrial companies are asking themselves how to improve customer experience throughout the customer lifecycle. They’re asking which value propositions are most important to customers at each stage of their journey.
And they’re not alone: between 2007 and 2019, public companies with the best customer experience performed 307 percent better than CX laggards.
But meeting customers’ changing needs is about more than introducing digital solutions to supplement legacy products. Let’s take a look at how Dickson has consistently focused on customer needs and what other industrial companies can learn from that focus.
How Dickson focuses on customer needs
Industrial companies may sell mostly to businesses, but it’s still individual people who use, interact with, and depend on their products.
Before wifi connectivity and digital solutions were the norm, for example, it was standard practice for medical employees to manually check temperatures on medication refrigeration units. There was never anything “wrong” with that system. But as customers grew accustomed to real-time data in other parts of their life (say, to track the location of a pair of shoes they ordered online), the Dickson team recognized that they’d expect the same level of visibility into loggers and chart recorders.
Reimagining its analog products to include digital sensors with wifi connectivity and data visualizations powered by the DicksonOne platform empowered Dickson to meet a much more pressing customer need: peace of mind.
Now, a lab director can get, say, a temperature change notification while they’re watching TV at night and take immediate action to investigate and address the cause. This makes it much easier for customers to not only protect the valuable components of their operations but also to relax and enjoy life with the knowledge that, if something goes wrong, they’ll know right away.
That’s what it means to cater to customer experience.
Takeaways for focusing on customer needs
Ask for customer feedback regularly.
Be proactive about customer experience; don’t wait for “problems.”
Recognize that customer experiences in other settings affect expectations for using industrial products.
Remember that business buyers and users are also individual people.
Understand that listening to and acting on customer feedback will lead to deep, abiding customer trust.
4. Be willing to collaborate
One of the main principles underlying product innovation is that collective wisdom is more powerful than any “lone genius.” Practically, that means that organizations that want to innovate consistently and for the long term must find ways for stakeholders from various disciplines to work together.
In many traditional industrial organizations, such cross-functional collaboration is difficult because of operational silos and even incentive structures that effectively pit departments against each other.
But breaking down silos and introducing practices for integrating teams internally and collaborating with external partners is worth doing: when experts embrace a collaborative ecosystem of teams, they earn more revenue and drive higher customer loyalty.
As industrial companies proceed through their digital transformation, they can particularly benefit from partnerships with firms that can help them set strategy and prioritize various initiatives on the journey.
Let’s take a look at how Dickson’s collaboration with TXI has powered two decades of digital transformation.
How Dickson powers digital transformation with collaboration
From the earliest days of TXI’s collaboration with Dickson, the teams have brought different knowledge to the engagement.
Dickson’s team has deep customer knowledge: buyer and user personas, use cases, pain points, etc. TXI’s team understood how to build digital products. Together, through 20 years of collaboration, these areas of expertise have informed the products Dickson has developed.
More than that, though, the commitment to collaboration has positioned Dickson for collaboration more broadly. For example, the company recently merged with Oceasoft SA and Oceasoft, Inc., to help it deliver environmental monitoring services to the European market. Having a culture of collaboration can facilitate M&A-powered growth and streamline the time to value for customers.
Another example: While Dickson took an engineering-first approach to most of its software and app development for many years, the team embraced in the last few years a more integrated approach, including design professionals in the process earlier on.
That shift led to steady progress in the usability of its digital solutions. For example, design leaders were the ones who pushed Dickson to reconsider the calibration practices.
Another design-led innovation: tying data from environmental monitors to specific equipment. In other words, when a monitor in Location 4 shows out-of-range readings, DicksonOne now indicates which equipment is in that region so customers can more quickly determine what actions they may need to take.
Takeaways on collaborating
More perspectives lead to more valuable solutions.
Internal partnerships (among teams) and external partnerships (with consultants, subject-matter experts, and others) can lead to increased revenue.
Meaningful collaboration requires skill and practice. If you’re inexperienced here, an innovation partner can help.
Ongoing collaboration is essential to continued innovation and digital transformation.
5. Strive for continuous improvement
Digital transformation is a bit like fitness: it’s not a matter of training for a marathon and then being in shape forever; rather, it requires ongoing effort and commitment to the things listed above (leaning on data and analytics, embracing change, focusing on customer needs, and collaborating).
The good news is that an ongoing approach is generally easier and more enjoyable than a single huge project every 10 years or so. And thinking of digital transformation as an ongoing, constantly evolving process better positions industrial organizations to operate in flexible, agile ways that let them respond to changing conditions in the real world.
How Dickson achieves continuous improvement
From the beginning of our engagement, Dickson was well positioned for continuous improvement in that it embraced the curiosity of its employees. When the sales team wanted to understand how people were viewing the website, Dickson hired TXI to help them find out––and, ultimately, to collaborate with them through two decades (and counting) of incremental changes.
While we’ve discussed primarily DicksonOne in this piece, TXI and Dickson are also collaborating on a number of side projects. Many such projects will fuel new products and product features. Some will lead to new understanding of Dickson’s customers or team or the industry. All of them contribute to the company’s ongoing forward march of improvement.
Even our partnership itself has continually improved as we’ve learned from each other and come to understand more about each others’ areas of expertise.
In the early days, Dickson and TXI collaborated to find improvements that were bigger––more leaps than steps. This is how we got from digital loggers whose data could be downloaded via USB to loggers with wifi connectivity and continual, real-time data.
Since we helped develop DicksonOne, we’ve collaborated with the Dickson team to update functionality, develop new features, and improve workflows to win new customers and improve the experience of existing customers.
This approach has been successful in part because we never attempted more than what made sense for the business. We focused on relatively small improvements, demonstrated their value, and continued from there.
That approach can be effective in any industrial organization, especially those that have historically struggled to innovate.
Takeaways for continuous improvement
Start small (again).
Measure the impact of each change (on customers, employees, supply chains, etc.)
Commit to learning from every change, whatever its impact.
Think of digital transformation as a mindset rather than a destination.
Seek out partnerships with experts in areas where you have knowledge gaps.
Industrial digital transformation is human as much as technical
Industrial digital transformation is not solely a matter of shifting to the cloud or introducing AI capabilities to your products. It’s an approach to running a business that involves responding to constantly changing realities in the environment, the marketplace, and the customer population.
To succeed in digital transformation and lead in industry 4.0, industrial companies often have to adopt new ways of thinking, operating, and delivering their products. When they do, though, they’ll win deep customer trust and loyalty and a culture that propels the company forward.
Interested in launching your own digital transformation? Get in touch.
Published by Jason Hehman , Andrew Horner in Industrial