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As you may have noticed here we have started a peer group process with leading firms from the Process Industries. These companies explore what comes after the obvious first steps in Digital Transformation which are frequently:
- operational excellence (smart plants with predictive maintenance and remote controlling, smart supply chains. etc.),
- increasing management capabilities via real-time insights into KPIs
- improving customer insights from CRM and other data (customer segmentation, journeys, etc.) and
- improving the predictability of future business
After several discussions we have found that the anchor point for our discussions will be “Using Digital Transformation for catalyzing growth” – where the “growth platforms” may be coming from the market side and/or from the technological side.
Operational Excellence: Focus for most companies
In the Desktop Research that we do to support the peer group’s discussion process we have collected more than 200 studies and articles. Our first analysis showed that currently there is heavy focus on systematically exploiting the Operational Excellence benefits of Digital Transformation
There may be several reasons why this is so: By its very nature, process Industries have a large base of installed sensors and a huge volume of historic, operational data. So the Operational Excellence focus …
- is in many cases a straight-forward extension of existing infrastructure (e.g. connecting two pieces of assets via cloud, collecting data and applying Big Data analytics)
- pays a quick dividend for Digital Transformation (savings on operational costs impact directly EBIT)
- does not require a huge change in the digital mindset since existing units and processes are provided with better tools.
Digital Transformation for growth: 8 routes
Interestingly, as we have found in our Desktop Research, the first papers are coming up that look beyond Operational Excellence and address the growth theme.
As of now, we have found 8 roads in which companies are exploring growth via Digital Transformation:
- Insight into market trends / New customer experience – Applying semantic Big Data on content on the web, contained in the market studies, in CRM systems show patterns / Analyzing and redefining customer journeys and customer experience
- Data Wraps / Data-as-a-service – Adding product and process data provides the opportunity to ‘guarantee’ a flawless production to B2B customers; Data may also be turned into sources of customer lock-in or sources of revenue
- “Application consulting 4.0” – Application engineers armed with deep information about materials and processes may provide a superior customer application consulting; This might even be sold via the value proposition ‘helping you to gain production performance’
- Smart products, e.g. functional surfaces
- Cross-industry platform plays – Partnering with players from different industries e.g. in the ares of functional surfaces or functional foods
- Additive Manufacturing – May be speeding up development cycles e.g. by building reactors to simulate process properties or may be a source of revenue, e.g. by delivering custom devices using smart products
- “Substance development 4.0” – Using semantic Big Data analytics to conduct reverse engineering (from desired function to needed material) and/or using automated pattern recognition to screen molecules in material or in medical contexts
- Insight into technology trends / new technology horizons – Using semantic Big Data analytics to explore technology trends, including other languages, e.g. Chinese / Opening up new technology horizons, e.g. bioelectronic medicine
Note on confidentiality
Due to the confidential nature of our Peer Group, we are not in a position to disclose details about the growth routes publicly. If your company is interested in joining, please drop a line to me here
innovation.support is an international agency focused on solving the ‘Corporate Innovation Problem™’. To achieve this, we provide consulting services based on proven, best-in-class methodology which in many cases is proprietary. The services are delivered by experienced innovation management specialists and by subject-matter experts.
Please get in touch if you want to improve the outcomes of innovation investments.
Read more by Frank Mattes, here
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