Integration is at the heart of modern digitization efforts in the enterprise. But unlike past attempts to converge data systems and processes, this latest wave of integration incorporates the entire enterprise operational stack – from the back office to the manufacturing floor.
Economists are already calling this trend Industry 4.0, given that it represents a shift in economic productivity rivaling the adoption of first steam power, then electricity, then data communications. According to Boston Consulting Group, we are at an inflection point in the digital transition in which companies across the economic spectrum are engaged in real-time integration between all physical assets and processes in the enterprise value chain. This means that not only will IT have to coordinate operations with consumer-facing systems like sales, marketing and support, but things like automated production equipment, purchasing, transportation and a host of other activities. In cost-sensitive industries like electronics and semiconductors, many leading companies are anticipating revenue gains of 20 percent or more in the next five years.
Integration on this level is neither easy nor cheap. But already, top consulting firms are laying the groundwork to at least identify some of the more common pain points and devise industry-specific solutions to overcome them. Jacobs Engineering Group recently released the Connected Enterprise framework, a suite of solutions that aims to push digital transformation across IT, manufacturing, the cloud and virtually everywhere else organizations need to coordinate activity on a digital basis. Built partially on software acquired from Apprion Inc., the platform incorporates elements of the Internet of Things, the Industrial IoT, Big Data and intelligent automation to ensure that the enterprise can keep pace with an increasingly interconnected world.
It’s important to remember, however, that this kind of transformation does not lend itself to easy solutions, says Gary Watkins, CIO of IT Shared Services at KAR Auction Services. With so many moving parts coming into play, one of the biggest mistakes is to think the change can happen in a traditional step-by-step manner in which old technology is swapped out for new. In reality, it requires a top-to-bottom reevaluation of the entire enterprise model incorporating such things as workforce and personnel hierarchies, risk factors and ultimate goals. It also requires the understanding that the transition will never be complete as it involves the ability to foster continuous development and continuous disruption of existing models and practices.
Indeed, says DATUM CEO Will Crump, digitization may be a highly technical process but it is not something that should be handed off to IT. Instead, C-suite executives need to take the lead role because ultimately it is more about processes and services than infrastructure. Success, after all, will not come from faster processing or better networking, since virtually everyone will have access to the same basic technology, but in analytics, governance and, most importantly, the insights that knowledge workers utilize to create new markets and new business opportunities. Ultimately, a digital-first culture is not driven by the technology at hand, but by the people who know how to utilize it to its fullest potential.
One way or another, digitization will hit every enterprise. The only question is whether a given organization will manage the change in ways that suit its particular needs or be swept along in broader currents that may or may not produce a satisfactory outcome in the end.
Arthur Cole writes about infrastructure for IT Business Edge. Cole has been covering the high-tech media and computing industries for more than 20 years, having served as editor of TV Technology, Video Technology News, Internet News and Multimedia Weekly. His contributions have appeared in Communications Today and Enterprise Networking Planet and as web content for numerous high-tech clients like TwinStrata and Carpathia. Follow Art on Twitter @acole602.