The decisions we make now will inform the success of our companies in the next 5 – 10 years. We’ve seen businesses across every market driving efficiencies and new ways of getting work done. We’ve also seen new business models and market advantages arise through agile processes and data analytics that were previously impossible.

The Covid-19 crisis has shown us how business can adapt quickly to situations and how digital tools have enabled continuity of operations and new processes. It has also highlighted weaknesses in our existing processes, supply chains and org charts.

Faced with the dilemma of ongoing uncertainty, do we invest now in tools that cement more agile ways of working, or do we take the risk of doing nothing to wait and see what happens?

We’re awash with solutions that might just be the answer, from the big name monolithic systems touted as safe bets by advisors and economic development agencies, to the smaller, niche cloud plays that together cover just about every corner of business.

So how do we cut through the hype and start to understand how digital tools can help us build more resilient businesses?

What is digital transformation – the first risk?

Like all buzzwords, digital transformation has been hijacked as a term. It has interpretations from the mythical to the mundane. But what should it mean for your business?

Getting ‘digital transformation’ wrong could cost you time, customers, staff or even your business. But doing nothing carries the greatest risk. 

If you’ve done the same for years, and customers have broadly accepted that, then where is the worry?

The well-worn tale of how Kodak failed to exploit its own digital camera technology and ride the wave that eventually took us to Instagram, Youtube etc, is fair warning to any business inclined to rest on its laurels.

So, digital transformation in its simplest form is a strategy for long term survival.

People get scared of software and technology. In reality it’s just another tool to be employed in the delivery of profitable, sustainable value to your customers. 

The keyword here is ‘transformation’. 

Risk – Digital Transformation is an IT Project

No, it’s a team sport.

So many companies make this basic mistake. If it is software or tech, it must be an IT project, right?

IT functions serve the business, they do not drive the business process. Yet companies make significant investments in business technology, expecting technology people to be able to fully understand the requirements, and deliver and embed these in the business.

Digital transformation, of any kind, is a leadership project and a team sport. It involves the whole business. Those with the long term vision, and those with the nuts and bolts understanding of the business and customer demands. 

Successful transformation projects are focused on improving the value added to the customer.

They eliminate waste and duplication of effort. They develop new processes, products and services that give competitive advantage. They exploit inexpensive technology to test theories and make incremental improvements.

Get a cross-functional team involved in creating innovative solutions to ensure success.

Risk – Digital Transformation is All or Nothing 

In the old days, the closest thing to a digital ‘transformation’ project in manufacturing might be implementing an ERP system. Typically a 5 to 6 figure investment, 12-18 months, expensive consultants and internal resource juggling existing processes whilst preparing the new system for the big ‘go live’ date. 

70% of ERP projects fail, due to poor management buy-in, inaccurate requirements, and project creep. By the time the ‘go live’ date is reached, the business has evolved away from the original scope.

With growing uncertainty, growing manufacturing businesses can’t afford to take this risk.

Today, cloud technology solutions address all sorts of needs in manufacturing. Most offer trials and monthly contracts. Most are designed around particular types of businesses and offer a close fit with business processes.

Whilst teams who succeed at digital transformation have an overall vision in mind, they win small, before they win big.

Map your processes – as they should be… Value stream mapping is a simple way to understand where barriers, bottlenecks and duplication exist in the process. These can be prioritised and tackled individually, managing risk and building confidence. Teams can collaborate to make processes work better, overcoming silo mentality, safe in the knowledge that they aren’t betting the whole company.

 Risk – Digital Transformation is Expensive 

Firstly, with a looming downturn and Covid-uncertainties can you afford not to change? 

Examining your products, services, markets and business models will offer new opportunities, and highlighting previously irrelevant risks.

Secondly, as described above, the technology market has changed. The tools and services you need to experiment with new and better processes are affordable and flexible. They do not take months or years to implement. And if they don’t work, you can try something else.

And, your data is usually available for download to try with other systems. 

Focus on the customer 

Great businesses predict customer needs before they even know themselves. Great businesses collaborate across departments, to make each other’s day easier, and deliver a better customer experience. Great businesses are more profitable, attract the best talent, and adapt to uncertainty better. The great businesses of the future are turning crisis into opportunity, today.

Digital transformation is nothing new, and for businesses hungry to innovate, nothing to be scared of.

Rich Dale is Founder & CEO of – cloud based manufacturing CRM and MRP software for small equipment manufacturing businesses and dealers.

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