Digital Transformation - an interview
I continued my discussion with Andrew and asked him about Digital Transformation. Personally, I don’t think there is a transformation going on but more evolution as usual. I discussed this with him and wanted to know his inside perspective. I asked him what is really new and disruptive.
“Huub, you are right we digitize our products and processes since we use chips and sensors. A few decades ago digitization started. Most of the software is still embedded. And since the chips can connect to applications outside their devices, of course there are many more possibilities for modernization. Internet of Things. But new? No. Disruptive? No. Transformation? Neither. We simply move on, inventing and using new technologies and platforms, we have to, we try to be competitive.”
“Why do you think people talk about Digital Transformation?”
“I don’t know really, perhaps because the connected part of the products and machines are more and more important. Nowadays we try to collect data from the users of our product, and from the sales process. We also try to find ways to upgrade software of our products once they are in the market in use. Like we do since years in our factories. We collect data from our robots since years. We have Digital Twins of course. But now we use these methods to get closer to our consumers and users. Technology wise not new. But it changes the business, the marketing and the support services. Perhaps that is why they use the word Transformation. Perhaps it is only interesting to call it Transformation to sell platforms, journals or consultancy. Perhaps because of the data security and privacy, it is more intense but not new either.”
I ask: “So internally, technically it is simply next steps, continuous innovation, as usual?”
“Yes Huub. We have the same processes, we do the same system engineering, include new features, we still have to test, make sure the software parts work well with the hardware parts, make sure the connectors work, make sure the connected applications work and use the sensor data, make sure the products are certified and safe. Perhaps the word Transformation is used for the way of working, moving to Agile as we discussed previously, but that is not Digital Transformation. You know, a Tesla car is still a car, with a lot of digital features in it, but it is a car and it needs to be assembled like any other device.”
This interview confirmed my own thinking: I do not believe there is a digital transformation, I believe there is continuous technology evolution. I don’t believe that manufacturing companies should transform, they can simply adapt their organization a bit if they need to. As Andrew said, a car is still a car, so is a washing machine, a TV, with or without connected applications. The fact that we have more and more software aspects in and around products, that we develop more and more smart services around them, does not change the essential innovation processes. I don’t see why this evolution cannot find place without expensive Agile Transformations, there is no need for the hardware people, the marketing people etc. to go Agile. If that is good for software development, fine. Also if software development is not Agile is fine. We went to the moon without Agile, we designed unmanned flying without Agile. I am convinced that Agile with bad engineers gives bad products. It is not the method, but the quality of people that makes the difference. So, no need to buy expensive, energy-hungry, and friction creating Agile Transformation projects, and no need to use big words to talk about Digitization. If software departments want to work agile, please do, but don’t force other departments to use the same methods.
I think that Digital Evolution can be executed by usual classical management methods, there is no need for a dramatic management revolution. Iterative cross-departmental collaboration, technical alignment and business alignment can be done as usual. New services can be implemented as usual. Instead of spending energy on Transformation I would advise to spend the organizational energy on continuous technical and business innovation, on transparency and coordination, without frictions and islands. And do that right! As usual.