Phase 1: Just getting started
There are many reasons why you may be struggling to move past this initial stage. For some, this is because there’s no need for Industry 4.0 investments; you’re confident in your products, processes and the stability of the market. For others, you’ve started down this path before, but your prior investments have not shown ROI, so you do not have the internal support you need to move forward.
At this stage, it’s common to have concerns that the required equipment, systems or workforce changes are too costly. This can be especially troubling if you have limited knowledge about what’s possible in terms of potential innovation investments – or limited resources to guide and support the process.
There are several challenges with staying in the avoidance stage:
The cost of inaction will grow
Your competition will eventually evolve
Your customers and suppliers will seek out more innovative partners
This will negatively impact talent recruitment and retention
At this point, you’ve either determined you need to invest in digital transformation initiatives or you’ve been forced to revisit your innovation strategy. This reevaluation often occurs for two main reasons:
Increased competitive pressure is impacting profitability. Solving operational inefficiencies will have a significant impact on margins.
Recruiting talent is becoming harder. Automation is being prioritized to solve potential talent shortages.
Some manufacturers have a hard time moving to the next stage due to a lack of best practices, clear vision of the areas to implement first or projected ROI. Internal pushback – due to fear of change, job losses, new training, etc. – is also a common concern.
You’re developing an innovation strategy during this stage and need insight into:
How the new technology aligns with overall business objectives
Which operational pain points will be addressed first
ROI projections related to efficiencies, cost reductions, or revenue increases due to delivery time improvements
Lack of internal expertise and uncertainty about how to align today’s operations with future needs are common challenges during this stage.
The testing stage is when you choose to test the innovation in a smaller area of the company first. This step is often taken to:
Validate the solution with a proof of concept
Avoid workforce disruption or misunderstandings
Gather more information to support further investment
Most of the challenges during the testing stage are internal. IT is not prepared to implement the technology. Employees have not bought into the new processes and are resistant to change. Leadership is concerned about unknown costs.
Additionally, data silos can be an impediment, as they limit visibility, connectivity and can negatively impact results.
