In the digital age, companies need to adapt to technological advancement and digitization of processes. Otherwise, they might lose a competitive advantage in the market to the companies that have successfully integrated digital solutions in their workflow. The current poster presents an overview of a transformation project for an automotive manufacturing company in the 4.0 Industry.
The work is based on the PwC digitization maturity model that consists of four levels, ranging from Digital Novice to Digital Champion. However, it is crucial to develop gradually and propose a consistent plan of improvement. As a result, the primary objective of the project is to discuss how the company can move from the first level of the maturity model (Digital Novice) to the second level (Vertical Integrator) (Geissbauer et al., 2016). To achieve this objective, it is necessary to examine at least five areas of improvement that contribute to the company’s digital transformation. They are compliance & security, employees & digital Culture, data analytics, digital business models, and agile IT architecture.
The first part concerns employees and digital culture, which are crucial to the company’s digitization. According to the experts, the most effective method to improve this area is to focus on collaboration rather than the individual efforts of employees (Hemerling et al., 2018). It means that the company needs to introduce effective leadership models that unite the team and present a clear understanding of the digitization process.
The second dimension refers to digital business models demonstrated on the right. The action plan for this area revolves around the understanding of customers’ needs and emphasis on lean principles of business. It means that the company needs to analyze its clients and provide flexible services based on this analysis (Balocco et al., 2018). As seen from the action plan, the primary points are:
- Determine objectives and values to understand customers’ needs
- Rely on the existing data analytics to support decisions
- Implement a flexible digital system of business models
These points illustrate the necessity of flexibility and interoperability in digital business models, which can be summarized as lean principles.
Consequently, the third dimension concerns compliance, security, and legal considerations of digitization. It is a relevant problem since digital solutions are associated with additional risks of private data breaches and legal issues. Therefore, the company needs to ensure the highest security of customers’ personal information to meet the contemporary requirements of the industry. The proposed action to address this problem is the combination of three factors – governance, ethics, and regulations (Floridi, 2018). In other words, it is essential to thoroughly examine the existing regulations for data governance before implementing additional digital solutions for information security. The second level of maturity model does not fully address digital problems of data protection; therefore, it is more important to focus on legal issues and governance first. Ultimately, any complication with the law will have negative consequences on the company, and it is essential to minimize these risks.
The fourth area is data analytics or “Data & Analytics as Core Capability.” It implies that the company needs to implement innovative and effective methods of data analytics to maintain its competitive advantage in the market. Some of the instruments include machine learning, statistical physics-based learning, information theory-based learning, and reinforcement learning (Tang & Meng, 2021). While it is not necessary to implement the most advanced methods at the second level of the maturity stage, it might be beneficial for the company to introduce the basic instruments of data optimization. It will increase the speed of operations and make employees accustomed to digital solutions in data analytics.
Lastly, the fifth area of improvement is agile IT architecture that integrates the digital operations of the company. At the second level of the maturity stage, the IT architecture is customized specifically for the needs of the company, but it might still lack functionality. Therefore, one of the most effective and easy-to-implement approaches is to invest in a reliable IT infrastructure from third parties. For instance, an IBM IT infrastructure is a flexible solution that might be adjusted to the company’s needs of internal operations. While it might be lacking in functionality in terms of the third and fourth levels of maturity, it is an affordable solution for the second level according to PwC standards.
Summing up, the current poster has proposed an action plan in five areas of improvement that might help the automobile company undergo a digital transformation. Each of the proposed solutions will have a beneficial impact on the organization’s performance and digitization process, namely:
- The improvements in the examined five areas will prepare the company for operations in the 4.0 Industry;
- The company should focus on the flexibility and interoperability of work processes to maximize its efficiency;
- The implementation of digital solutions is an effective method to improve the organization’s productivity.
As a result, the company will significantly benefit from the proposed transformation project.
References
Balocco, R., Cavallo, A., Ghezzi, A., & Berbegal-Mirabent, J. (2019). Lean business models change process in digital entrepreneurship.Business Process Management Journal, 1-24. Web.
Floridi, L. (2018). Soft ethics, the governance of the digital and the General Data Protection Regulation.Philosophical Transactions of the Royal Society: Mathematical, Physical and Engineering Sciences, 376(2133), 20180081. Web.
Hemerling, J., Kilmann, J., Danoesastro, M., Stutts, L., & Ahern, C. (2018). It’s not a digital transformation without a digital culture.Boston Consulting Group. Web.
Geissbauer, R., Vedso, J., & Schrauf, S. (2016). Industry 4.0: Building the digital enterprise.PwC. Web.
Tang, L., & Meng, Y. (2021). Data analytics and optimization for smart industry.Frontiers of Engineering Management, 8(2), 157-171. Web.