Manufacturing Leadership: What's Needed to Drive Digital Transformation

It doesn’t matter whether you call it “advanced manufacturing,” “smart manufacturing,” or some other variant of digital transformation. Stated simply, manufacturers are increasingly integrating technologies like automation, artificial intelligence/AI, and data analytics into all aspects of how they operate, from the production floor to the supply chain. As these technologies transform the way manufacturing gets done, manufacturing leadership must change to keep pace.

 

Today’s manufacturing leaders need to be adaptable, agile in the face of accelerating change brought about my new technologies and new market demands. They must be tech-savvy, especially when it comes to production automation and AI, two technologies that leverage the huge volumes of data collected during the manufacturing process. This raw data gets transformed (through data analytics) into business intelligence that will be used to inform better decision-making from the shop floor to the C-suite. The challenge isn’t collecting or generating beautiful reports based on this data. The challenge is in driving data-informed decision-making across the entire organization, setting up new processes and ways of working that dynamically optimize technology and people, and help manufacturers thrive. 

 

Digital Transformation Has Changed Manufacturing Leadership

Understanding how all the components of a manufacturing eco-system interact in real-time, including equipment, technology/data, processes, and people, is extremely important for any manufacturing leader. Effective manufacturing leaders need a strong awareness of how one component might impact another within a complex system. For instance, implementing the latest technology won’t work if your people aren’t fully trained in how to use it, or if data from the new tech doesn’t sits in a system silo, not shared with the rest of your tech stack. At a basic level, manufacturing leaders need technical know-how about equipment, automation, data, systems integration, and the subtleties of actually producing things, as well as a deep understanding of people (employees and customers alike) and the whole change management process. These demands make hiring and developing great manufacturing leaders both complex and extremely important.

One result of accelerating technological change is that all manufacturing leaders need to be quick learners capable of upskilling fast. The “hard” or technical skills they’re using today may become obsolete in a few years, so having the capacity to learn and apply the emerging skills of tomorrow will be key to career development. As manufacturers become more agile, so must manufacturing leaders. Blending legacy ways of working with emerging possibilities is exactly what effective leaders must focus on.

Data Proficiency is a Leadership Must-Have

It’s easy to add a sensor to almost any piece of manufacturing equipment today, making it a “smart” machine that can transmit and receive data in real-time from other machines and systems, thus building a manufacturing eco-system. All of this data enables everyone, from the factory floor to the C-suite, to make short and long-term process improvements. But this “data opportunity” also presents a massive analytical challenge: how can leaders working inside the organization differentiate the signal (the relevant data you want to identify and use) from all the noise (the massive amount of data you should ignore)?

 

“Smart” manufacturing will demand enhanced skill sets and some deep thinking by leaders when it comes to leveraging data. They don’t need to be expert data scientists, but they do need to know how to ask relevant questions and how to “interrogate” data to uncover business solutions. Leaders must be data proficient, capable of aligning data and strategy in order to manage their key performance indicators or KPIs. What data points should be the highest priority to collect, share, analyze, and base decisions upon? Having the right technology in place will be essential, but you’ll also need smart leaders capable of analyzing all this data and transforming it into good decisions that align with the organization’s strategic objectives. The ongoing shift to smart manufacturing -- blending smart technology (automation, AI, etc.) and smart people -- will translate into more efficiency, agility, and greater profitability for U.S. manufacturers, assuming smart leaders can make this complex system work.

 

Constant Upskilling is a Leadership Priority

The challenge manufacturers face isn’t just developing manufacturing leaders with the necessary skills in technologies, data analytics, manufacturing fundamentals, and people (employees and customers). Unfortunately, leaders with these needed skills are hard to find and hard to develop -- as every manufacturer knows. The burden also falls on leaders themselves to constantly upskill (themselves and their organizations) in order to keep pace with a landscape of accelerating change in technology and markets.

The facts are clear: manufacturing is a high technology industry that needs top, tech-savvy talent in leadership roles. Manufacturing has become a leading implementer of high technology, and the products today’s manufacturer’s make are often cutting-edge, high technology devices. People’s perceptions of manufacturing need to catch up with the high-tech realities of “advanced manufacturing.” Manufacturing leadership roles are increasingly high-paid and require technological skills as well as skills around people and strategy. Leaders must be lifelong learners, because change is constant.

Developing the Future Manufacturing Leader

Great manufacturing leaders are first and foremost problem-solvers with a broader, inclusive mindset that goes beyond silos and narrow areas of technical expertise. They bridge the theoretical and the practical, and are comfortable working across disciplines and departments, to drive business outcomes. Emerging technologies are great, but leaders need to align them with effective go-to-market strategies and high-performing, multi-disciplinary teams to execute and build anything worth building.

 

As future-of-work expert Jeanne Meister, author of The Future Workplace Experience, explains: effective leaders must be “system thinkers who take a holistic approach to analyzing the complexity of any problem and examine it from all angles. They have curiosity, grit, adaptability, as well as the ability to stick with and solve complex business problems when things are hard and directions are not explicit.” This systematic approach to tackling complex problems is how manufacturing leaders generate business value.

 

Technological tools will always be important. But it’s understanding relevant problems at a deeply human level, and blending tech and human capabilities to effectively address those problems, that will truly create long-term competitive advantage. “It’s not just about knowing the latest technologies. To be a good decision-maker in manufacturing, a person has to master the core principles that determine how to apply those technologies under uncertain conditions,” says MIT Professor David Hardt, a leading expert in advanced manufacturing. That ability to navigate well in conditions of uncertainty/complexity is what manufacturing leadership looks like in an era of digital transformation. The demands on manufacturing leadership won’t be getting any easier anytime soon: quite the opposite, as this post has shown.