Are you reading the right IIoT roadmap? A lesson in tough love

Manufacturing is changing really fast, but you probably don't need me to tell you that. Let's take two examples, the reshoring of production post-pandemic and the rise in automation generally that have both taken place over the last ten years.

Look ahead another decade and the changes we're going to see will be even bigger as digital transformation starts ripping through the sector. When we really start embedding analytics, cloud computing, AI, machine learning, the blockchain, and, of course, the Industrial Internet of Things into core business functions as a matter of course, who knows where we'll get to.

All of these will be essential ingredients not just for success but actual survival, because ultimately digital transformation is about enabling companies to deliver a faster, better, and more personalized customer experience, a key differentiator in a brutal marketplace.

However, knowing that as a manufacturer you're going to have to transform fundamentally is one thing. Having a clear idea of the path you need to take to do it, is something else entirely.

You’re going to need some kind of roadmap to guide you. Without one you're leaving the future to chance and that's a recipe for disaster because you’ll end up in the wrong place, guaranteed.

So, do you know what your roadmap is going to look like? Maybe. Or maybe not.

But let's take a step back. While you need a destination for any trip, you also need to know where you're starting from. And unfortunately, I go to many companies that don't know where they are right now. They're lost because they haven't answered some basic questions about what their business is for, or what they want it to be. 

And if you don't have a clear picture of what you need to change in your business then you're dead in the water, right up that proverbial creek without a paddle.

But answering these big juicy questions isn't easy when you're at the center of things. In fact, it's all too easy to draw the wrong conclusions.

Sure, I know you think you know your business best, but often an outside view can show you another way. Particularly when you are in a hole it's good to have someone who's not in it with you to pull you out, just to make sure the pressure you're under hasn't clouded your vision.

But even those who are doing nicely, thank you, can suffer from clouded vision, and here's a good example.

In my book Remake, I mention visiting a prospective client, a large manufacturer in Mexico. Well-established with good products and a strong customer base. They aren't quite 'best of the best', but they are pretty close to it.

Now, you don't get to be in this position without a strong, competent leader in charge and the guy I met was certainly that. He's also a man with a plan — and a big one — because his ambition is for the company to be an even bigger player by adopting an Equipment-as-a-Service model. Moving from selling your product outright to making it available through subscription can be a good call, but it's a big ask, not least because of the initial loss of revenue. If you want to know more, take a look at the 'fish model' that's on page 88 of Remake.

Anyway, this CEO believed using the IIoT would be a necessary and major component in this venture, and he wanted my advice on how to bring it into the business. This is what I do, so I'd like to think I was able to add value. 

And do you know what my advice was to him after I'd been on a tour of his factory? Don't even try, or you'll crash and burn and that's an absolute given.

Why did I say that? 

Because the business wasn't yet in the right place to start out on its transformation journey and certainly not one as big as this.

Did I say that you needed to do some prep first? If I extend my roadmap analogy, this is the bit where you do your packing. And for this business, there was still a lot of packing to do before they could even start thinking about moving to an EaaS model.

Because to make this model work, your after-sales has to be absolutely solid and that means having in place a workflow that's as efficient as you can possibly make it because you must be able to operate without any disruption 24/7 if you are going to deliver the business outcomes you have promised your customers.

So, this was the 'packing list' I gave this guy.

One. Make sure you aren't too dependent on limited sources of supply. If you have components coming from just one supplier and they hit a problem then you have a big problem too. So, secure your supply chain. That could mean vertical value integration, I'll talk about that in another blog, but it could also mean sourcing components nearer to home. Global events over the last few years have shown the disadvantages of globalization.

Two. Create a planning system that facilitates the fast transit times that underpin seamless after-sales service. You need to be able to do 'just in time' deliveries.

And three. You must make sure that every workstation is in sync. Again, if you aren't making the right component at the right time, that's going to hit your ability to deliver the rock-solid promise you've made to your customers.

Until things like this are fixed, then something like this transformational model won't work. All it's going to deliver is a bunch of unhappy customers who aren't getting the guaranteed business outcome you promised them.

I often have these 'tough love talks' with CEOs. Sometimes they work, and sometimes not. In this case, I'm glad to say we're now working together and that the company is moving in the right direction.