The world is changing fast, and as manufacturing transforms through the adoption of new digital technologies, the need to focus on quality is increasing exponentially. But do organizations understand the true meaning of digital transformation? Are the quality and IT organizations aligned and closely partnering together to manage risk and deliver on the brand promise? Are companies equipped to consume the unprecedented data that we will generate and be able to extract the right insights to make better decisions? Most companies are still in the learning phase to be able to answer yes to these key questions.
It All Starts With Quality
Digital transformation, automation, artificial intelligence (AI), machine learning (ML) and other transformative technologies promise a myriad of benefits for manufacturers but quality must always be at the core. It simply doesn’t matter how efficient, how progressive, or how automated a company becomes, if quality is compromised the results can be disastrous. That’s why IT and quality must work together to establish the building blocks that will support every transformation initiative, across each phase of the product journey.
The IT team’s role is to drive innovation, the quality team’s role is to manage that change, and make sure the company can consistently deliver on its brand promises. If quality is not managing the risk, and making sure that the innovations IT proposes meet the brand’s standards for quality, there may be monetary and reputational consequences.
This dynamic makes quality and IT the two most important teams in this new era of digital transformation, with all the unknowns it will bring. When this partnership is executed successfully, these companies will be well positioned to gain a competitive advantage and harness the promise of digital transformation; to increase efficiency, reduce costs and create new opportunity while maintaining quality every step of the way.
Digital Transformation vs Digitization
The first critical step in this journey is to clearly understand what is meant by digital transformation. Digital transformation is the application of digital capabilities to processes, products, and assets to improve efficiency, enhance customer value, manage risk, and uncover new monetization opportunities. When operating in silos, some organizations confuse digital transformation with digitizing a formerly manual process. For example, replacing paper with digital records is digitization on an existing process. For many companies, that is the “crawl before they can run” towards the benefits of Industry 4.0.
Digital transformation in manufacturing requires not only bringing processes and documents online, but also utilizing the resulting data for decision making, process improvement, redesign and risk reduction. It’s about using data to optimize the entire manufacturing processes and that is why IT and Quality must act in close partnership to manage risk and opportunity across the full product life cycle.
Quality’s Role in Brand Promise
Quality also plays a critical role in delivering on the brand promise and companies, no matter how well established, can suffer irreparable damage when that promise is broken.
Take for example the unexplained fires and overheating problems that led to more than 2.5 million Samsung Galaxy Note 7 smartphones being recalled just two months after its launch in 2016. Samsung eventually discontinued the Galaxy Note 7, bringing the estimated total cost of the recall to at least $5.3 billion and causing unquantifiable damage to the Samsung brand.
The Samsung recall received significant media attention, and is just one of countless examples of manufacturing quality failures that occur worldwide which wreak havoc on brand reputations. These failures are a constant reminder of how important it is that IT and Quality act together as the two departments that have full visibility and are in the best position to manage the full product life cycle.
Industry 4.0 — The Data Challenge
Even the most skeptical executive knows that Industry 4.0 and its most forward thinking technologies like AI, ML, and Big Data aren’t just passing trends discussed at networking conferences. They are the spearhead of a massive transformation for global manufacturing.
Accordingly, IDC estimates that 40 percent of all technology spending will go toward digital transformations, leading enterprises to spend over $2 trillion towards these changes in 2019. Smart businesses are already starting to innovate and gain a competitive advantage.
But while these technologies come with the promise of making manufacturing easier, there are new challenges to address such as the unprecedented amount of data they will generate. IDC estimates that we will create 163 zettabytes of data per year by 2025 yet it is estimated that less than 0.5% of all data ever gets analyzed or used.
From a manufacturing perspective this shift will create significant challenges and opportunities for organizations. Those that are equipped with the right skill sets to validate data integrity, analyze the data, identify opportunities and/or risk and take the appropriate action will come out on top.
The Role of Quality in a Data-Rich Environment
Quality professionals will play a key role in this data-driven process and are responsible for managing quality across the product journey. Quality manages planned strategic organizational change, especially when it comes to products. That is why quality must be involved in the planning and execution of any digital transformation strategy a company undertakes.
Take for example “smart factories”, which Deloitte defines as a factory that can integrate data from system-wide physical, operational, and human assets to drive manufacturing, maintenance, inventory tracking, digitization of operations through the digital twin, and other types of activities across the entire manufacturing network.
If the quality professional isn’t working hand in hand with IT to steer the innovative minds building these types of factories, then there is a significant risk that quality issues may be overlooked or introduced. If IT does not leverage the product, process or compliance knowledge of the quality team they may not set up the proper quality controls for these new systems and as a result the promise of Industry 4.0 may be diluted, lost or worst case leave companies in a weaker position than when they started.
The Changing Requirements of the Quality Professional
As manufacturers embark on digital transformation initiatives, data analysis will be one of the most important skills that quality professionals will need to master. Those who can utilize the massive amounts of data generated by these new technologies will find themselves in high demand and well compensated. The role of data analyst is already the hottest job of 2018 and IBM is predicting that the demand for data scientists will grow 28 percent by 2020. Clearly with these macro trends in play, a quality professional who understands data, who can interpret it and put it to proper use is going to be more in demand than ever before.
Dr. Joseph A. DeFeo, founder of the Juran Institute, has worked with thousands of quality professionals and says that without a doubt, the two biggest skills that are going to be needed in manufacturing going forward are data analytical skills to analyze the massive amounts of data companies will generate, and critical thinking skills to determine what should be done with the data.
“For example, we might have a part being produced on a line and that part fails but its root might have been a design failure, or the supplier selection,” says DeFeo. “The responsibility now is to try to figure out where the problem came from, then work with those folks to make a change.”
In DeFeo’s example, data could be coming from multiple sources and in large quantities. Quality professionals will need to be prepared to quickly make sense of all the data, then decide how to act on it.
The world is changing fast, and it can be intimidating at times, but the need and importance of quality and IT to partner and work in concert to promote innovation and quality from product design to customer experience has never been greater. At the same time, quality professionals must adapt to meet future needs and embrace the opportunities technology will create to help their companies. Together, IT and quality can establish the building blocks that will support every transformation initiative, across each phase of the product journey, creating value while helping to ensure the successful realization of the benefits of Industry 4.0.
Frank Defesche is senior vice president and general manager at Veeva Systems.