Click to learn more about author Mighael Botha.
Technologies like Cloud, Mobile, Analytics, the Internet of Things, Dynamic Apps and Big Data have spurred a digital revolution. Coupled with the clout of today’s digital-savvy consumer, they’ve paved the way for nimble digital disrupters to create brand new business models overnight and rapidly seize control of entire markets. In short, digital transformation is changing the way organizations connect with customers to stay relevant while incorporating smarter technologies that allow businesses to become more competitive.
However, many large organizations are not implementing the most innovative or relevant digital transformation strategies for their business. Many are being misled by vendors or consultants and taken down a path that may not be the most fruitful for them – and wasting a good deal of time and money in the process, while racking up considerable technical debt.
In order to reap all of the benefits digital technologies and their accelerating impact offers, it’s imperative that these organizations drive digital transformation from the ground up.
Meet Your Enterprise Digital Twin
Digital transformation doesn’t happen in a vacuum. To help drive innovation across the entire enterprise, organizations need a continuous loop of feedback and input from across the enterprise in order to stay relevant and viable. To create this feedback, organizations must create a “digital twin” that can offer guidance for their digital initiatives.
Today, digital twins are being introduced across all lines of business. Known more commonly as enterprise digital twins, they are a representation of an organization’s physical assets that help to illustrate its business operating model from end-to-end. With many moving strategic and operational targets, program and portfolio managers can often struggle to translate desired business outcomes and customer experience measurements into operational indicators that can be used to monitor the progress toward the goals of their digital business initiative.
This is where the enterprise digital twin comes in. Many organizations use twins to put a magnified view on their business operating model and then coordinate the critical inter-dependencies between people, processes and IT within complex digital business transformations. In a nutshell, they make sure an organization’s future plans fit within its existing infrastructure.
Ensuring the Success of Digital Transformation Strategies
Once a digital twin has been created, organizations must follow these three key best practices to ensure the success of their digital transformation strategies.
- Consolidate all quality management systems into one common digital platform
Especially in heavily regulated environments like finance, pharmaceuticals and healthcare, quality management plays a critical role in ensuring products and services are consistent and ready for market. To achieve quality excellence, organizations need a standardized platform that allows all employees to share and collaborate on business processes, documents and systems.
Employees from the shop floor and business departments are always aware of the latest updates in policies and procedures thanks to simplified access to information. With a central quality management system, everyone in the company can easily search for the information relevant to their job (like a certain policy) or join a collaboration stream on a subject that involves many different people. This allows organizations to serve their customers the best product or services and make processes and procedures more customer-centric.
In addition, leveraging a single platform ensures that processes are tightly linked and connected across the enterprise with real-life data. This allows enterprises to gain the transparency required across their operations to make better decisions that will drive continuous improved business outcomes and initiatives.
- Map risks and compliance requirements to business processes
Compliance and risk management has never been more critical in today’s hyper-connected world. Risks are everywhere; from legal penalties and financial or material loss, and many risks arise from compliance requirements like the European Union’s General Data Protection Regulation (GDPR). Businesses need to know these risks in order to control them and they need to know what they affect to implement the right measures and ensure compliance.
By integrating impact analysis, risk assessment and mitigation into business processes, organizations create full visibility on where and when these risks can occur, what they affect and what possible damage can result. This allows them to take the right countermeasures, like implementing controls and risk-mitigation measures, and identify where to improve issue and incident tracking capabilities.
For example, for businesses in the oil and gas industry – where operational missteps can create environmental catastrophes, loss of life and financial cost measured in the billions – documenting and monitoring the most critical operational processes is essential.
- Use real-time insights to gain visibility into all elements of the supply chain – and make informed decisions to improve logistics
Supply chain management is a daily balancing act between logistics challenges and customer requirements. In this environment, getting relevant information and full insight into all elements of the supply chain quickly is critical in order to respond to customer needs and ensure goods and services are delivered on time – all the while staying competitive.
With a digital twin, organizations can easily find information that shows all relevant facts and figures that are needed to identify potential opportunities and problems in the supply chain – for example, rising customer complaints or order fulfillment time. Increased visibility and transparency of the entire supply chain enables organizations to understand their end-to-end processes, find bottlenecks and, above all, improve the performance of these processes to be better, cheaper and faster.
Taking a look back at the energy sector, which has deeply complex supply chains (e.g. operations that span remote locations both on and off shore, transport by ship, rail and trucks across multiple geographical borders, etc.), visibility into processes such as production, shipping and freight clearing can accelerate those processes to make them more effective and efficient.
Digital transformation initiatives trigger a whole set of interrelated changes to an organization, its products and services, as well as its internal and external relationships, making it a complex task to manage. By using a digital twin, organizations can gain true visibility and situational awareness, making them more agile and adaptive to the changes occurring within their walls.