Digital transformation at a company like Milwaukee Tool 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 with Dickson to transform 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 adopted these five mindsets that let it keep innovation at the forefront of everything it does:
Embrace data and analytics.
Embrace change.
Prioritize customer needs.
Be willing to collaborate.
Strive for continuous improvement.
Milwaukee Tool is already doing some of these things. The next step is to uncover the gold mine of opportunity at the heart of each mindset. Read on for a closer look – we’ll use Dickson’s story to illustrate.
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 100-year-old manufacturing companies, though, the digital transformation journey is an enormous undertaking. These companies were founded before desktop computers (never mind smartphones). It’s hard work to transition core operations to modern technology.
Milwaukee Tool already succeeds at helping tradespeople transform their own data-based decision making. The ONE-KEY platform, for instance, makes it easy for users to monitor tools’ real-time usage and location. They can use that data to evaluate tool performance over time and reduce losses from misplaced or stolen tools.
But how will Milwaukee Tool meet the needs of future customers? What systems do you have in place to identify those needs and test ways of meeting them? That’s the next phase of digital transformation: finding ways to not just collect this kind of data but to use it to power decision making at every level 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 Milwaukee Tool 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 used 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––like when to ease off catalogs and ramp up their web presence.
What might that look like at Milwaukee Tool? It could mean leveraging data from ONE-KEY to gain deeper insights into how tools are used on job sites—identifying trends in tool performance, usage frequency, or even common user pain points. This data could help guide smart tool development, inform marketing campaigns, or pinpoint opportunities for enhanced customer support.
It could also serve as a benchmark for reporting on the ways Milwaukee Tool products impact energy use in various industries, which could help the company comply with climate regulations down the road.
Data and analytics takeaways
Ask everyone on the Milwaukee Tool team what they need to do their job better.
Translate needs to metrics.
Start measuring.
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 firms like Milwaukee Tool become more “reed-like” so they’re positioned to seize new opportunities? Milwaukee Tool has a head start: after the 2005 acquisition, the company went back to its roots by listening to tradespeople about their biggest problems so you could design more helpful products. But taking full advantage of Industry 4.0 requires even bigger changes. Let’s take a look at what Dickson’s experience can illustrate.
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.
Milwaukee Tool can enjoy similar results by continuing to gather product ideas straight from the jobsite and by taking a similar approach to your own factory floors. How might new technologies, new skills, or new data sources increase efficiency or help reduce costs? Are there opportunities to better unify different departments under the goal of pushing innovation forward?.
Takeaways for embracing change
Continue to take a “start small” approach. Milwaukee Tool is no stranger to this innovation mindset, but doubling down on incremental change is crucial for long-term success. After all, it’s typically easier on people and organizations than a string of drastic overhauls. And a ubiquitous culture of accepting change can also greatly reduce the need for dramatic change.
Stay attuned to new technologies. We all have that relative who resisted getting a smartphone and then was stranded at the airport and unable to call an Uber. As Milwaukee Tool knows firsthand, technology may seem like a luxury until suddenly it isn’t––it’s a necessary foundation for seizing new opportunities.
Keep listening to new ideas. Your frontline teams already gather product ideas from job sites. Make sure everyone recognizes the value of these bottom-up insights—the next leap forward might come from a line worker’s questions about AI or machine learning. The industrial firms that win in Industry 4.0 will be those that see these questions as a jumping-off point to learn more.
Try new approaches. 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 throughout your business. Don’t just limit this mindset to your customer-facing products. It should apply to everything in your org: technology, pricing, business models, customer care, and beyond. Embracing change means practicing it constantly so that you don’t grow too large and rigid to adapt when conditions shift.
3. Focus on customer needs
Customer experience is a contemporary buzzword for something Milwaukee Tool has cared about forever. And that’s incredibly savvy: between 2007 and 2019, public companies with the best customer experience performed 307 percent better than CX laggards.
But in an era of evolving expectations, meeting customers’ needs is about more than outfitting your smart drills with upgraded sensors. Let’s take a look at how Dickson has consistently focused on customer needs and how Milwaukee Tool can deliver more value by finding creative ways to do the same.
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 nothing “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 empowered Dickson to meet a much more pressing customer need: peace of mind.
Now, a lab director can get 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 to not only protect the valuable components of an organization but also relax and enjoy life with the knowledge that, if something goes wrong, you’ll know right away.
That’s what it means to cater to customer experience—something Milwaukee Tool already excels at. But there’s room to go further. The next step might be exploring new tech that can optimize internal processes and boost customer satisfaction along the way.
For example, a digital twin of your factory floor could help teams find ways to accelerate production, eliminate bottlenecks, and get tools into customers' hands even faster. And a quality assurance team equipped with spatial computing headsets could more easily spot defects and improve your products’ reliability.
The upskilling necessary to ensure your team can use these technologies would also position you well to seize other opportunities that these advanced skills require.
The bottom line? By improving what’s happening behind the scenes, Milwaukee Tool can continue to exceed customer expectations and stay ahead in the market.
Takeaways for focusing on customer needs
Continue to ask customers directly about their experience. You know firsthand that the best way to understand customers’ needs is to go straight to the source. Double down on this approach to continuously improve the customer experience.
Remember that customer expectations are informed by everyday product experiences. The more customers use AI or encounter next-day delivery, for instance, the more they’ll expect the same from your brand.
Don’t forget to look inward. Milwaukee Tool is already delivering exceptional products, but optimizing behind-the-scenes operations can boost efficiency and customer satisfaction.
Explore emerging Industry 4.0 technology to improve internal processes. The tech you use internally should match—or even exceed—the sophistication of your consumer-facing products.
Remember that operational efficiency has a downstream impact. The better your internal processes, the stronger your customer experience will be.
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, this 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, integrating internal teams, 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 companies like Milwaukee Tool embark on a digital transformation journey, they can benefit from partnerships with firms that can help them set strategy and prioritize projects. Let’s take a look at how Dickson’s collaboration with TXI has powered two decades of digital transformation and how similar collaboration might benefit Milwaukee Tool.
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 understands how to innovate and 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 a French competitor to help it deliver environmental monitoring services to the European market. Having a culture of collaboration can facilitate M&A-powered growth and reduce the time to value for customers.
Milwaukee Tool is in a similar position to Dickson. Your company has undergone an M&A itself, and your team recognizes the value of innovation to make battery-operated power tools the norm on every jobsite. Working with a partner who understands innovation as well as Milwaukee Tool understands power tool manufacturing would lead to developments that add new value and improve customers’ lives sooner. This way, you can stay one step ahead of the competition.
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 organizations like Milwaukee Tool 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 because it embraced the curiosity of its employees. That’s led to the development of major software, the implementation of significant product updates, and a series of smaller, less-dramatic tweaks and adjustments.
This approach has been successful in part because we never attempted more than what made sense for the business. We started with relatively small improvements, demonstrated their value, and continued from there.
That approach can be effective at Milwaukee Tool as well. Factory workers interact with your equipment every day. By asking them about their pain points, you can find new ways to improve your internal processes – and your products as a result. If you’re not already asking folks on the floor for their ideas on that front, today is a great time to start.
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 improving the sensors in your smart tools or bringing AI to ONE-KEY. 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 continue leading in Industry 4.0, companies like Milwaukee Tool have to commit to innovative ways of thinking, operating, and delivering their products. When they do, they’ll win deep customer trust and loyalty and a culture that propels the company forward.
Interested in revving up Milwaukee Tool’s digital transformation? Get in touch.
