From strategy to implementation: how a roadmap helps to implement digitalisation

More courage for digitalisation! It's easy to say, but when it comes to implementation, companies repeatedly come up against their limits. A lack of digitalisation is a challenge that the manufacturing industry in particular has to face.

The opportunities and potential benefits of digitalisation are well known. The question is: why is it that progress is still so slow? The report by the "Research Advisory Board of the Industry 4.0 platform/acatech - National Academy of Science and Engineering (ed.): Blind spots in the implementation of Industry 4.0 - identifying and understanding, 2022, DOI: 10.48669/fb40_2022-1" has identified various reasons for the lack of implementation of digitalisation based on a survey. These include five main reasons:

• lack of initial impetus,
• lack of strategic capability,
• conscious decision against digitalisation,
• internal implementation problems and
• inadequate external framework conditions.

Five reasons with different causes. A closer look reveals one common factor: The strategic questions have not been adequately answered.

But what exactly does that mean? And what does digitalisation actually mean? To answer these questions, we will first create a basic understanding of the concept of strategy. We will then clarify how it drives digitalisation in the company.

What is strategy?

We tend to think we know exactly what is meant by the terms strategy and digitalisation. But if we ask ten people for their definition, we get eleven opinions. It therefore makes sense to first create a common understanding of the terms.

The term strategy cannot be clearly defined. In my opinion, however, the definition by Roger Martin, author of the book "A New Way to Think", best summarises what is meant by strategy:

A successful strategy requires a comprehensive analysis of the business environment, a clear definition of objectives and priorities, and effective implementation and monitoring of actions. A good strategy can help a company stand out from the competition, understand market conditions and respond to change.

Strategy vs. planning: why a clear distinction is crucial for the success of your digitalisation

In my view, there is a big misunderstanding about strategy. I can only guess how this misunderstanding has come about - whether it is due to strategy consulting, a lack of successful implementation or a lack of understanding of strategy. There are probably several reasons. A lack of strategic capability therefore remains a key driver for the lack of implementation of digitalisation.

Above all, I observe that in practice, planning is used as a substitute for strategy and labelled as "strategic planning". If you attach the word "strategic" to any business word, it seems to become even more valuable.

Strategy encompasses the decisions that enable an organisation to "win" in a given competitive environment. It is based on a theory whose aim is to offer customers the best possible added value. Planning, on the other hand, defines specific projects with deadlines, budgets and responsibilities. Strategy and planning should complement rather than replace each other. An effective strategy requires thorough planning. And planning is of limited value without a strategy.

And what is digitalisation?

Digitalisation has played an increasingly important role in society and the economy in recent decades. It has become a key factor for economic growth, competitiveness and innovation. It provides organisations and companies with opportunities to optimise work processes, improve products and services, develop new business models and make better decisions.

In the manufacturing industry, there is often talk of digital transformation. This transformation is intended to pave the way for Industry 4.0. Industry 4.0 should enable companies to make their production more efficient, flexible and cost-effective. This is achieved through the networking of machines, systems and products as well as the introduction of intelligent, automated and data-based processes. The transformation also has the advantage of rethinking value creation. New digital business models are emerging and existing ones are changing.

Digitalisation roadmap: How do I get started with implementation?

In addition to the lack of strategic capability, the report by Platform 4.0 and acatech also cites a lack of initial spark as a reason for the lack of digitalisation. Apparently, many companies lack the right prerequisites or have doubts about where to start with digitalisation. The so-called digitalisation roadmap can be such a starting impulse. It enables the step from strategy to planning and implementation.

The roadmap offers the opportunity to implement the strategy in a structured manner. It helps to maintain a clear overview of the goals, milestones, resources and schedules of the various digitalisation initiatives. Various steps and measures are visualised and their dependencies and priorities are shown.

An example of such an approach is presented below:

1. As-is analysis: Analysis of the current situation to determine where we stand, to identify any "white spots" and to consolidate the digitalisation potential in a "longlist".

2. Vision and GAP: Development of a uniform, common understanding of digitalisation for a holistic, company-wide target image that is accepted by all those involved.

3. Business case: Comprehensive assessment of the qualitative benefits of all projects in the overall portfolio and sorting by "quick wins", short-term and long-term projects and thus development of a longlist of projects and their cost-benefit estimate.

4. Planning: Prioritising the measures according to the greatest benefit and developing an overall roadmap of all projects.

5. Realisation: Identification of all resources required for a successful start to implementation. In addition: Development of all formulated profiles for the prioritised projects including milestones and personnel planning as well as refinement of the overall roadmap around the prioritised projects.

Such a roadmap can of course look different from company to company - different issues require different approaches. The decisive factor is which strategy is being pursued, which IT competences are available, which projects are already being implemented, etc.

A digitalisation roadmap is a crucial aid in overcoming implementation problems. It serves as a guideline for planning and implementing the transition from traditional to digital business processes. In summary, the implementation of a digitalisation roadmap is an important step for companies to remain competitive.

You can find more information about our digital solutions for the manufacturing industry on our website.

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