The digital transformation of businesses – driven by Industry 4.0 technologies such as artificial intelligence (AI) and machine learning – is, by its very nature, a complex affair.
Technically complex, yes, but also complex in terms of what these vast programs of change require of people, especially in terms of old skills they no longer need and new skills they need to acquire.
Digital transformation is sometimes seen as a panacea for all contemporary business challenges, which of course is not the case. Many supply chain managers — in manufacturing, logistics, and purchasing — have a first-hand or second-hand war story to tell about at least one failed technology project.
“Most digital implementations have about a 30-40% success rate, in terms of adoption,” says David Loseby, the famed procurement consultant who also has a Ph.D. in behavioral science.
The “mindset failure” behind many failed digital transformations
Loseby says the failure rate is so high because of a “failure of mindset” on the part of organizations. “Digital transformations are not technological change projects,” he says. “These are people-changing projects. If you don’t involve the people who are going to be affected and suddenly impose on them, guess what? You get a lot of rejection.
For Loseby, re-skilling employees and clearly delineating their changing roles is an inviolable step in any technology change project.
He warns, “You drag them into fear of the unknown. You need to balance the equation by making sure there is something in the process of change for them. If I’m an employee and you want me to give you my heart and soul, my knowledge and my intellectual property, then don’t let me worry about being sent somewhere else at the end of it all.
Loseby points out that the common thread of successful digital transformations is the people-centric nature of these processes, as opposed to the tool. To work, he says AI and ML programs need to consider all stakeholders – staff, suppliers and also customers.
Few people in the world of supply chains have a better idea of what people want and expect from their jobs in today’s uncertain and ever-changing world than managers working in recruitment.
Such a person is Jeremy Kaltzvice president of operations at Talascend, industrial recruitment agency. Kaltz says that, at the lower end of the supply skill spectrum — warehouse handlers, for example — many see these roles as a short-term means to an end, but by no means all of them. “Some see these opportunities as the starting point for their careers and long-term development,” he says, adding that developing hard skills “is motivating for most.”
On automation, companies need to take people with them
Kaltz echoes Loseby’s view that when it comes to automation, companies need to take employees of all levels with them. “It’s a candidate-driven market,” he says. “But once a material handler trusts and respects their employer, you will see a very high level of commitment.
Loseby believes that every digital transformation has a “sweet spot”, where technology and humans work in harmony.
Sam Slatersenior vice president of global operations at Global Logistics Craneagrees, saying that many supply chain workers see technology as a way for their employer to compete in a tough market, and that it gives them a sense of security.
“People want to be sure that their organization is well positioned to be competitive,” he says. “They see technology as a key part of that competitiveness.”
Slater offers examples of where Crane has achieved synergy between people and technology – Loseby’s elusive sweet spot.
He says the company has an automated e-learning management system that can be used for personal development plans, as well as a global reporting system that any employee can access at any time. of Crane from his smartphone.
Slater continues, “In fleet management, automation has reduced wait times and load matching. The more the wheel spins, the more money people make – and that contributes significantly to their retention.
When it comes to automation, Slater believes the key to success is always leadership: “The worst part is making the process more complex than necessary. It will always be an industry built and driven by people. Technology does not replace leadership.