The “factory of the future” is not just about implementing new technologies like smart machines, cloud platforms, edge devices, robots, and artificial intelligence. It is about a business transformation that requires a shift in mindset and organizational culture to engage with customers, rethink outcomes, and execute highly connected processes.
Traditional organizational structures are becoming inadequate for changing business needs and many jobs are changing or being replaced by automation. The composition and definition of jobs in the factory are rapidly changing. The reliance on digital technology is increasing in every job.
Organizational culture can move people to act or inhibit them from acting. Culture is built over time by design or default. Leaders can shape culture intentionally and harvest the higher performance attained through organizational culture linked to business strategy. Shaping organizational culture is more than a nice-to-have, it is a business imperative that has a tangible, meaningful impact on the bottom line.
Organizational Culture – the formal or informal, agreed upon, attitudes and behaviors that are encouraged, rewarded, and corrected inside an organization.
There is a need for organizations to reinvent themselves and promote a culture with higher levels of digital dexterity. Gartner analysts surveyed manufacturing organizations [1] and found that:
- 56% indicated existing employees struggle to embed digital into their day-to-day work
- 52% lacked skilled workers to support digitalization plans
- 50% had no formal skills development plans for existing employee
According to the National Association of Manufacturer’s second quarter 2018 Manufacturer’s Outlook Survey, “For the third straight survey, the inability to attract and retain quality workforce was the top business challenge for manufacturers, cited by 76.7% of respondents.” [5]
Manufacturers cannot sit back and wait for the workforce to develop the required skills at their own pace. If your company is not doing anything about it, you are in the minority. According to the NAM survey, two thirds of respondents say they plan to increase apprenticeships, training and mentoring programs in the next year. [5]
Lead the Transformation
Shaping culture is a discipline and demands the same time, rigor, and conscious attention as any business improvement endeavor. There are many tools available to shape culture and develop new skills in the organization, but a good transformation starts with good leadership. Leaders play an important role in not only promoting and communicating the need for a culture change, but also in modeling the right behaviors. When leadership, engagement and tools are combined, great success is achieved and people nourish what they’ve jointly created.
Leaders create the vision and narratives that resonate with a company and its employees. The corporate business narrative should highlight the importance of developing new skills whenever appropriate. A narrative is a story that explains how and why the company is pursuing the evolution to a more digitally integrated business. It sets the tone on why it is important for all employees to become digitally dexterous.
Digital Dexterity – ability and practice needed to leverage and manipulate media, information and technology for better personal and business outcomes including the ability to participate across virtual and physical systems to communicate and collaborate in agile networks of data exchanges.
Leaders can model the desired skills and culture themselves and be seen actively engaged in the new skills development programs. For example, a manager in a meeting with multiple department heads can point to a department that is underperforming on a specific metric and either choose to address the issue constructively and offer to help the department, or choose to demand an improvement from the department in a month without offering help. The leader can build trust among team members by modeling the importance of transparency and the need for collaboration or can decide to use the availability of new data as a tool to increase fear among supervisors. Which behavior will yield better results?
Assess Capabilities and Concerns
The increasing level of digitization in business is changing the velocity at which organizations and people collaborate in digital manufacturing ecosystems. Automation and robotics will replace the need for people in some repetitive manual tasks but will also increase the need for new skills in other people-driven tasks.
Organizations will embrace technologies that require skills with higher levels of complex problem solving, creative thinking, and cognitive flexibility. For example, field technicians will be equipped with new capabilities like augmented reality work instructions and data input via voice commands.
The development of digital skills in the workforce is an important part of developing the culture for the factory of the future. It is important to start with an idea of existing capabilities compared to the skills required to properly execute the corporate digital strategy.
In fact, Gartner found that the top three challenges for Chief Data Officers all had to do with concerns about the required culture and skills to achieve their goals. [2] (See Figure1)
Figure 1 – Top internal roadblocks to Chief Digital Officer initiatives
Are employees struggling with new digital technologies and processes in their day-to-day work? Some probably do and it is probably affecting the overall business performance. Those struggles may include learning new competencies, adapting to new levels of collaboration among departments, working with new human-machine interaction, and losing their intuitive response actions due to radical change in business processes and organizational structure.
Are employees concerned about the increased level of automation and machine-human interaction? Do they feel that their jobs are in jeopardy because they do not have a clear picture of the future state and how they are part of it? It is important that employees understand that they will have a part of the company’s future state if they do their part and develop the skills required for their future job.
One way to know if the organization needs to tackle new levels of digital dexterity and literacy is by pointing out symptoms of organizations with issues in these areas. The following are potential symptoms in organizations that need more digital dexterity:
- Using the wrong type of chart to clearly present a particular dataset and correlation
- Not understanding the correct context around a data trend or specific data deviation
- Not clearly stating the assumptions behind the presentation of analysis
- Using the word “median” and “average” interchangeably without understanding the difference
- Requesting “give me all the data and I will figure out later what to do with it”
- Cherry-picking data and dimensions to highlight at staff meetings in order to bias a business decision rather than uncovering different perspectives on the data
- Not agreeing on common definition of metrics across the organization
Cultivate and Promote Adaptability
Several technology advances are expected to have a beneficial transformational impact over the next few years on the daily tasks of the workforce. Technologies like speech recognition, content collaboration platforms, and mobile role-based apps are already improving performance and workflows for many workers. In two to five years, human augmentation and remote expert guidance are expected to help workers perform a wider range of capabilities with less formal training. Natural language interfaces and bots will get more sophisticated and will become part of many workers activities. It is important that the workforce becomes ready and comfortable with these types of assistive technologies.
Employees need to demonstrate an openness to new digital rich and interactive ways of working not only with peers but also with technology and machines integrated into the business processes. For example, tools like collaboration platforms that leverage shared knowledge and social networking create a new level of transparency in the organization. Personnel must trust that management will use this new level of data transparency for the benefit of optimizing the overall business process, and not for micromanaging employees’ time spent at the restroom. Otherwise, employees will not fully embrace these new technologies and a more “collaborative” culture.
When we embed digital technologies into manufacturing processes we create the need for new job profiles like robotics specialist, IIoT data scientist, machine learning programmer, and augmented reality author. Where are these skills going to come from?
Methods of tackling the skills gap and culture development include:
- Recruiting skills from the outside as permanent or contract personnel
- Education and skills development programs
- Knowledge management process to capture the undocumented knowledge from current subject matter experts.
- Mentorship programs between more experienced and newer employees
- Behavior reinforcement programs
Develop Digital Dexterity and Literacy
Even though tools like advanced analytics are becoming more readily available through easier to use tools and economical cloud services, the lack of employee data literacy can be a constraint to its widespread use throughout the enterprise or can lead to misuse of the data or technology.
Enlist the HR team to emphasize the need for new skills like data literacy explicitly in hiring, onboarding and employee development activities.
Data Literacy - the ability to read, write and communicate data in context. This includes an understanding of data sources and constructs, analytical methods and techniques applied, and the ability to describe the use case, the application and resulting value. [6]
Speaking data is no longer a language reserved for data modelers. Data and business intelligence is getting democratized as newer tools make it easier for employees to access structured data and create custom reports to show the correlations they need to highlight and identify specific issues or opportunities in the business. However, even though tools are making it easier to access and mine data, these new capabilities require that employees attain higher skills in data literacy.
This need becomes more evident when we consider that humans are interacting with machines more in everyday business and that machines speak “data” as their first language. Machines are getting smarter, but their communication skills are still limited and designed to be efficient in providing data, not so much on making data understandable to humans. Personnel working with these machines need to understand what the robots are saying and how to respond appropriately.
There will be different levels and specialties of data literacy required depending on how close each job is to the data or machine versus how close the job is to working with other people, but in general, everyone in the organization will need higher data literacy skills. For example, the data competency will be different for jobs like information architecture, data asset management, data science, customer data service, and workflow optimization analysis. It is important for organizations to hire on more personnel with these skills—hires that will share the new knowledge with others through organized knowledge transfer programs.
People have to be given a chance to learn in order for a culture to thrive. The organization should not only provide the tools needed to be successful in the new corporate business model; they must also provide the training required to use the tools and promote the desired collaborative behaviors.
Approach teaching data literacy by using examples from employees’ personal lives. Use examples like online shopping, home finance management, GPS maps and personal health monitoring. This creates a unifying experience from executives to workers, from data scientist to those who struggle with a spreadsheet. With the basis of personal life examples, it is then easier to transition to the business scenarios.
The organization can leverage this transformational time as a great opportunity for exchange of knowledge between employees with seniority that understand well the business processes and the newer workers that bring external knowledge of new technology into the organization. Programs could be crafted to promote a different type of knowledge exchange relation, beyond the typical mentor program, that benefits both the senior and new employee.
Knowledge from experienced personnel could also be captured into digital standard operating procedures (SOP). The team can prioritize areas that need to be documented. Areas where the company might be of risk of losing valuable skills, and areas that have a big variance in quality and rework tied to experience level. The team needs a methodology to capture the knowledge. This is usually done through illustrated work instructions authored in a Manufacturing Operations Management (MOM) or Manufacturing Execution System (MES). Some organizations might even adopt 3D augmented reality to assist mechanics in their day to day jobs.
Third party resources including commercial training sites, assessment guidance, expansion courses by universities and colleges, are generally fragmented for this new digital manufacturing landscape. Pioneers should try to collaborate in these early stages with industry consortia and manufacturing consulting groups that are trying to fill the gap in current educational programs.
It is important to see these development efforts as more than a one-time training exercise. Organizations need an enablement program that allows the workforce to stay up-to-date with skills and train themselves through exploration and on-demand training. This is critical to a sustainable skills management model.
Enable more self-service technology like access to self-service query and reporting tools. Empower more non-IT employees to participate in the digital integration of the enterprise. Of course, IT has to be setting some governance and rules to ensure that the organization is marching to an overall architecture plan. But IT moves from being perceived as a constraint to perceived as an enabler for progress.
IT should establish programs for data governance that establish data security and quality protocols, general data models and metadata management, data integration, and business intelligence tools. For example, centralized data and metrics glossaries, can help create a common data language in the organization.
Emotional and behavioral training might also be needed to facilitate the new levels of communication, transparency, and automated oversight. People are not automatically ready for these new levels of openness, collaboration and supervision. Without training, employees can get frustrated, anxious and experience higher levels of stress in the workplace.
Embrace Organizational Collaboration
Employees need to demonstrate an awareness of the internal and external business context and effectively collaborate with people of diverse perspectives and experience levels.
Management should support more transparent and collaborative ways of working among internal departments. This means that metrics are not used as a whip to extract higher performance from specific departments or employees. Instead, metrics are used to diagnose systemic issues and potential process improvements in the organization. It means that we focus on the performance of teams and less on the performance of specific employees.
The enterprise should elevate more suppliers to collaborative partners in the future value chain. This requires a different culture for managing suppliers. We move from reactive and cost cutting at all cost to a more win-win collaboration where the best way to service the end-customer at a reasonable price is openly discussed among all stakeholders in the value chain. Behaviors are reinforced among partners with financial rewards instead of penalties.
A way to promote collaboration while also increasing skills is to use a work shadowing program between internal departments. When implementing a shadowing program to promote collaboration between internal departments, it is better to focus the program on learning the workflow between departments versus learning the inner workings of each department. By focusing on the inputs, outputs and the data exchanges between departments, employees will learn how collaboration helps the overall business processes. Focus the program on this type of systems thinking. The end goal is to learn the importance of better communication, transparency and workflow practices.
Broker more connections with experts outside of the organization. The organization is not going to learn new skills unless they are exposed to more outside expertise through trade organizations, technical conferences, and training services.
Reinforce the New Culture
Management can cultivate the importance of digital dexterity, not just as a business skill, but also as an important life skill as we will continue to see more digital technology affecting our daily lives.
Choosing behaviors that will be rewarded sends a clear message to the organization. Both formal rewards (via company performance management systems) and informal rewards (via a more personal approach by leadership) are key to reinforcing the behaviors that collectively shape the culture.
It is important to recognize that not everyone will come around for this journey. Not every job will remain in the future state of the organization and new jobs will become part of the landscape. Some will embrace the change, some might not, but all should have the opportunity to learn new skills and find a place in the future organization.
References
[1] “Let’s Get Digital: Findings from Gartner’s Factory Digitization Study”, Jacobson, 2018 Gartner Supply Chain Summit
[2] Executive Guidance: Digital Dexterity at Work, Gartner, 2018
https://www.gartner.com/en/executive-guidance/digital-dexterity
[3] Digital Transformation and the Workforce, IndustryWeek Survey, 2018
[4] Gartner Says Too Few Organizations Have the Digital Dexterity to Adopt New Ways of Work Solutions, Gartner, 2018
https://www.gartner.com/newsroom/id/3879581
[5] “Manufacturing the Next Generation”, Quality Magazine, 2018
[6] “Getting Started With Data Literacy and Information as a Second Language: A Gartner Trend Insight Report”, Logan/Duncan, Gartner, 2018