Siemens Successful Digital Transformation (Part 3 ) – 14 – by Space Dreamer M.Temel Aygun

My penguin by Reha Mustecaplıoğlu –

KEY SUCCESSFUL PRACTICES BY  THE CDO IN THIS CASE WERE

  1. Instituted a culture for the digital age by 
    1. Selecting the team of venture and  software developers based on parameters that included openness  
    1. Locating the team in a different building and holding the training in a distant location to preserve the culture and remain untouched by corporate routines
  2. Led and built the right teams by 
    1. Backing all the software developers in the training phase and thus generating a great success story on a new approach on their return  
    1. Having a right mix of juniority and  experience for the team of venture  developers – junior venture developers brought the drive and passion for technology, while experienced ones brought the necessary expertise. In this case, in fact, a junior venture developer with around  five years of work experience was elected  the Managing Director because of his unparalleled contribution to the unit 
    1. Giving some of the software developers additional administrative roles in the unit since they became role models and experts in agile methods 
  3. Leveraged agile training methods such as eXtreme Programming (XP) by 
    1. Having a developer and a trainer sit side-byside in front of a computer for live coaching on software development for quick results 
    1. Moving away from theoretical passive training to interactive feedback-based live sessions involving all key stakeholders  such as customers and partners

CASE

A large industrial supplier was developing its Internet of Things (IoT) operating system. Given its global footprint of functions, the project had 50+ teams spread across 10+ sites worldwide. The Change Management team was set up right at conception and had a flat hierarchy of 10 project managers representing each of the 10 functions, a project COO and a project CEO.

EMPOWER PEOPLE TO MAKE QUICK DECISIONS

Rules for delegation of authority were defined for the functional personnel to make quick decisions or escalate to the project COO/CEO, who provided an integrated view across functions on top of coaching the project managers. The team used a digital communication tool for rapid communication across functions and to disseminate information deep within the organization.

Due to the volatile nature of the project where “plans created at 8:00 am were obsolete by 8:30 am,” the flat hierarchy with quick decision making was critical to the successful launch of the operating system. Post launch, many of the change team members were given managerial responsibilities in the new department that owned the operating system.

To establish a culture of self-development for newly required skills, a program that covered the total cost for an online master’s degree in computer science was launched for every employee, from software developers to functional and managerial staff. Incentives were introduced including a 5-digit cash bonus, a guaranteed 15% raise and a stock grant on successful completion of the course.

KEY SUCCESSFUL PRACTICES BY THE  PROJECT CEO/COO IN THIS CASE WERE

  1. Led and built the right teams by  
    1. Organizing teams in a flat hierarchy for  fast information flow to facilitate decisions 
    1. Having more experienced personnel to manage cross-functional topics 
    1. Empowering personnel closer to the information with the authority to make decisions 
    1. Analyzing and empathizing with personnel  in case of suboptimal decision making 
  2. Leveraged instant communication by 
    1. Using modern digital tools – Yammer, WhatsApp, James, Poll Everywhere for messaging; Circuit, Zoom for virtual  conferencing, etc. – for interaction at  a team or one-to-one level
  3. Established a learning organization by 
    1. Setting the right incentives to foster  curiosity for seminal topics and tools

CASE

A leading energy equipment supplier had automated the gas turbine part design process by leveraging big data and AI. The AI algorithm would identify design improvements for the components to further increase the efficiency and life of the turbine. This would expedite the existing process – which was largely manually driven by engineers – to significantly improve time-tomarket and reduce costs. However, given the company’s quality obsession, the engineers weren’t quite sure of the algorithm’s effectiveness. They perceived the automated process to be an 80/20 approach with lower quality compared to the existing lengthy, human-driven process. Additionally, they feared job losses due to autonomous operations. This led to significant resistance in implementing the initiative.

COACHES MULTIPLY YOUR CHANCES OF SUCCESS

Subsequently, the company adopted a new approach. A 3-day workshop was conducted in which “coaches” – selected engineers who were role models to the rest and showed openness to change – were shown the company-wide digital strategy and how it was critical to remaining relevant in the market. Also, they were shown new job roles that would emerge post transformation with a roadmap for their development. The discussions were interactive and their preference for future job roles was sought. Since these roles would upgrade the engineers’ productivity and skills, they were an attractive proposition.

Additionally, “translators” – personnel who had a mix of experience in design, business, technology, and human resources – were included in the change team. The “translators” were able to bridge the communication gap between the change team and “coaches” to facilitate a common understanding. Once the “coaches” had all their doubts addressed, they went back and communicated their stories to the others. This completely turned around the mood in the engineering teams and many of them proactively contributed to a successful launch of the algorithm.

KEY SUCCESSFUL PRACTICES BY THE  CHANGE TEAM IN THIS CASE WERE

  1. Built and led the right teams by 
    1. Identifying “coaches” who were role models to the engineers and showed openness to change, and “translators” who had a mix of experience in design, business, technology, and human resources; translators were typically junior employees with 6-8 years  of experience 
    1. Providing transparency, empathizing with and listening to the opinions of operational staff, instead of top-down execution 
    1. Communicating benefits to the engineers that would arise out of more productive roles in the future as well as empowering them to choose their future roles
  2. Managed transition to new roles by  
    1. Providing complete clarity on future roles and a training roadmap for the engineers to fill in those roles

KEY RECOMMENDATIONS

A successful digital transformation journey requires you to  not only set the right sails and embrace the safety of a solid  boat hull, you also have to steer your organization in the desired direction. Integrated Change Management, both agile and digitally adapted, will ensure you hold the course – even in troubled waters. These are our key recommendations to  help you navigate:

  1. INSTITUTE AN INTEGRATED APPROACH TO CHANGE MANAGEMENT : Change Management is crucial for creating acceptance. Include Change Management as early as the conceptualization phase of a digital vision instead of waiting until implementation. Don’t treat it as a separate workstream operating independently from the other ones. It needs to be an overarching element in your digital transformation. Set up an Executive Action Team to gain commitment from top management, buy-in from operational staff and effective integration across functions and departments. When it comes to technology and process decisions, always consider the effects on existing social interactions.
  2. LIVE AN AGILE CHANGE MANAGEMENT APPROACH : Setting up a flexible process for concept and strategy development allows you to continually adapt by incorporating acquired knowledge during the conceptualization and implementation phases. An iterative feedback approach not only gives you insights but allows you to react quickly. You should carry out pilot tests as early as possible for the same reason. Proactively anticipating human reactions and modifying change measures will also help you remain effective. To account for these uncertain and volatile aspects, define agile KPIs and trade off with classic business KPIs.
  3. ADAPT CLASSIC CHANGE MANAGEMENT LEVERS TO THE CONTEXT OF DIGITALIZATION : During change, employees look to their leaders for clarity, connection, and accountability. Leadership should, therefore, be proactively involved, transparent, collaborative and empathetic during the entire transformation journey. Set up project teams with flat hierarchies and a good mix of juniority and experience. Personnel closest to information should have the authority to make quick and informed decisions. Encouraging staff members who are open to change to be role models and coach their colleagues will further create buy-in, as will personnel with cross-topic experience functioning as “translators”. Live the transformation by using communication and collaboration tools: Be digital in your interactions with existing and new, internal and external stakeholders. Inclusive, hands-on and practical training methods such as live demonstrations with customers and partners will strengthen involvement. With the right policies and incentives, you can institute a culture of continuous improvement.

While these recommendations will go far in charting your course, each journey is unique. Your specific challenges should be met with individual solutions. Let’s set sail together for a smooth ride on the high seas of digital transformation.

05.07.2020

Kadıköy, İstanbul – TURKEY

Author: M. Temel AYGÜN, Ph. D. in Aerospace Eng.

https://www.linkedin.com/in/mehmet-temel-aygun-1066a514/

Copyright belongs to Author.

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