How efficient is it to carry out digital transformation at a non-digital enterprise?
More than 50 % of companies around the world have faced difficulties when initiating digital transformation, because the technologies they use are outdated. In 2017 and 2018, 63 % of companies in Russia started out on this journey. It is particularly difficult in industry: as such implementing complex IT products within Russian and Indian enterprises in the mining industry is one of the most difficult processes, because this sector is very conservative. There are three secrets which will help managers to successfully carry out a project based on implementing IT products and increasing productivity in a company.
Working effectively with staff
There are several interest groups or stakeholders of digital transformation: shareholders (clients), top managers and other employees of the enterprise. Each group has its own interests and goals which do not coincide. Shareholders must be shown a working product, top management want to see its efficiency, and employees need to be shown how to use it. Opinions at the top differ on the level of digital activity: in 2018 40 % of managers believed that everything was fine, while 35 % of top managers doubted this.
The manager working on implementing the IT product must work closely not with the company’s leadership, but with line managers and their subordinates. It is important to teach staff to use the opportunities offered by the product and to collect as many reviews as possible about its operation. This requires a change in attitude towards the work of the company’s specialists and employees. Every member of the collective must be fully aware of his or her new function.
A common mistake is interacting only with top management and shareholders. The vast majority of managers implementing IT products work with the big bosses to meet their requirements. This leads to the collapse of the project and will lead to competitor’s products being purchased in the long term. Top managers in the mining industry do not have the necessary competences to bring the product into industrial operation.
So, when implementing Zyfra products, our team holds presentations at every enterprise for all employees, covering the digital transformation of the business and the internal algorithms operating in our software. From the very beginning we help to analyze operational data, which allows us to make decisions about production in real time, and to introduce the company’s employees to the operation of the new software. This sense of involvement in something new elevates employees’ level of responsibility. On average, this process takes several months. Specialists working at the enterprise may be unfamiliar with automation and digital technologies, so it is important to use understandable terms and words.
The manager should change their working approach, which has developed over the years in the industry as a whole. The staff must be informed of the value of the new software and the necessity of using it at the enterprise, as well as the significance of automating processes for work. For example, control loop monitoring systems (CLMS) in production save 10 % of energy resources, reduce spending on technical maintenance by up to 10 % and increase labor productivity by 5 %.
Advanced training for staff
Every manager working on the implementation of an IT product should teach people to use it to increase labor productivity. Teaching a user, providing them with all the details and capabilities of the product and, best of all, using it with them for a certain amount of time are all important. Essentially, one should create a market of professionals with knowledge of their own company’s products, since a lack of qualified staff is one of the main factors which stunts digital development according to 33 % of people asked by Deloitte. According to a survey by Veeam Software, 44 % of respondents think that the principal barrier to digitalization is insufficient abilities.
It is a fatal error to stop training specialists to use new IT products, or to be too formal in your approach to training. Most people won’t admit that they are unable to use something new because it might lead to administrative consequences or dismissal, despite the fact that fear over losing one’s job is minimal in the mining sector, according to HeadHunter. On a scale of stability ranging from -1 to 1, the figure in this industry is 0.43.
Nevertheless, in certain cases people are happy to learn independently about the product’s capabilities and ask technical support for clarifications. This makes it impossible to effectively make use of the product’s capabilities and risks making the user turn away from it, since it is not meeting their requirements.
At one enterprise where a Zyfra product was implemented, it was revealed after almost a year that the employees were using only 25 % of its capabilities and the vast majority preferred to resort to older tools. Of 100 analytical reports and operational tools, only 5 were in constant use. Of course, this created a negative experience for the users and the company’s management. After providing repeat training with comprehensive coaching of individual key specialists, we moved all production departments to working with our product, which increased the company’s productivity by 10 % in just one month.
Constantly working on the product
Collecting theoretical and practical data throughout the product’s use is the longest and most important stage of its implementation. It is a mistake here to stop overcoming difficulties and correcting errors in one’s own IT product, or to keep it the same as when it was conceived by the developers. You should persuade programmers and managers in your company of the need to make changes and improvements.
Managers implementing IT products are unfamiliar with the technological processes and cannot be experts in this field. If the set tasks are resolved, production workers themselves will provide comprehensive information on the product’s shortcomings, on which the programmers can then work. The willingness of employees to work with an IT product depends on it being complete and free of bugs. This is evidenced in the example of implementing a CRM in the company Sibur: in January 2019, 347 entries were made into the system, but in May, after “tweaking”, there were 1,819.
On one of our projects, which took two years to implement, it turned out that only 15 % of the system’s capabilities were being used, and only by the dispatchers. No one had followed internal orders to assign responsible individuals for the product’s different modules. There was no main user or end user of the system within the enterprise who could learn the functions and use it, or draw up objective reports. There was no link between the planning and production departments; the company’s employees did not know who was responsible for filling out the product’s handbooks. It is important to note that the top management were informing shareholders that 100 % of the system was being used, which was not true.
Our team took responsibility for the use of the system and monitoring the implementation of internal orders, and by communicating with the end users created the necessary production requirements for the system and sent them to the development department. We were involved in all production meetings, observed life at the company, carried out planning and experimented with the functionality of our product, which attracted individuals who are responsible for production. As a result, the client gained not just a product, but a new working system which paid for itself in one year, and the end user received a product which was necessary to implement.
Regardless of the qualifications of staff and their level of conservatism, you can implement new complex products and successfully carry out digital transformation. The most important thing is to build long-lasting relations and make changes to your working philosophy – a long process which requires considerable effort.
Checklist for implementing an IT product
- Define the direction for digital transformation, as well as who the product was created for and who will use it.
- Explain its value to staff as clearly as possible.
- Continually retrain staff to teach them about new capabilities.
- Test the product, experiment with its functions and discuss all issues.
Valery Didenko is the head of mining products technical support at Zyfra. Zyfra started its operations in September 2017 in Helsinki, Finland. The company develops industrial digitalization technologies for machinery, metallurgy, mining and oil & gas. The solutions include predictive analytics and data analysis, tech processes optimization, automatic dispatch systems, autonomous dump trucks and teleoperated equipment.