Digital Factories – What Are They & How They Transform Your Delivery Model?
Digital Factories are like what Transformation was to progressing a company or product to the next stage in their digital transformation evolution. The Digital Factory takes transformation to the next level of effectiveness. The concept of Digital Factories is not new, it’s just not as common however slowly picking up in popularity.
Transformation initiatives, whilst great in practice, have had some bad press for not achieving their objectives, and in our collective commercial experience, transformation always missed some important hotspots;
Culture
Many transformation projects fail due to lack of corporate cultural considerations. Culture is a key component to any deliverable that has a wide reaching impact.
Agility
Many transformation projects operated in loosely coupled silos with functional management still influencing their representatives, leading to diluted focus or distractions from the core objectives.
Custom production lines
Failed to mimic industrial lines for software development, constructed of cross functional teams working in a tightly coupled feedback loops
This is where Digital Factories come in. They are ideal for new technology adoption, creation of minimum viable products (MVP), start-ups or departmental acceleration. Digital Factories can be as small as 10 people or as large as 50, but need to stick to the principle of remaining the lead in the overall delivery (people, process, systems). The Digital Factory group is made up a coach and scrum, with the group having the final say on recruits into the Digital Factory and the objectives.
Like any new business, digital factories can miss their creation target if not constructed correctly. Just like a production line, if not setup suitably for the objective or it’s not agile enough to flex to suit its purpose or changing business needs then whomever attempts digital factories will be wasting company resources.
Digital factories can be setup as incubators for a more modern and agile form of working, and refining it and then re-injecting the optimum culture and configuration back into the business unit to be more effective in their product creation. Alternatively, and equally suitable, Digital Factories can be a standalone cluster to serve a purpose (product or service development).
Whatever the approach, senior leadership of companies considering Digital Factories have to be clear on exactly what they wish their Digital Factory to achieve (deliver products faster or create capabilities or scaling) and accept that this would need a whole new set of rules, mindset or organizational construct and open to investing time and capital to research & develop the best Digital Factory configuration for their needs.
Culture and operating model of a Digital Factory are important factors that make a Digital Factory a success. The Digital Factory may be constructed for a specific purpose and exist in parallel to the broader organization structure. Digital Factories can also be dismantled and reconstructed for another purpose. Digital Factories should be setup as lean units.
Outsourcing software development and other components of a Digital Factory can be a suitable approach due to the nature of the flexibility and scale adjustments of an outsourcing model.
Digital Factories challenge the traditional corporate structure, in that is a model within a model and may not be conducive to most organisations, and will only succeed with top leadership buy-in.
Digital Factories are ideal to tackle top priorities for organisations. Successful organisations who sponsor Digital Factories see them as a plugin model for where the priority is, where the factory can have a defined input and output.
Leadership of a Digital Factory are also critical to the agility and success of this organisational construct, and the “people” aspect of who makes up a Digital Factory and the culture shift from the base organisation are also a critical elements to the success story.
The factory leadership have to also be empowered to be able to make daily and material changes when needed. The factory needs to be funded well and the funds protected, to allow the factory to develop its setup structure and then flourish in their delivery in a sustainable way.
The Digital Factory is like the lighthouse of change, and their success will drive momentum across the organization and enhanced the digital shift. If you want to explore the possibilities of developing a Digital Factory, get in touch with us.