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Ops 4.0: The Human Factor—Impact drivers

Every capability-building program needs a sense of purpose.
Markus Hammer

Has a passion for capability building with deep expertise in lean and green operations and the use of advanced analytics in operations; experienced in successful large-scale operations-transformation programs

In a previous blog, we discussed the importance of Rule Number One: value is defined by the needs of the customer. As companies plan their investment in new technologies and the skills that will drive them, however, they sometimes forget Rule Number Two: learning needs must be driven by business impact.

That’s understandable amid the buzz about the extraordinary potential of industry 4.0. As our colleagues have reported elsewhere, digital technologies could boost the value generated by industrial companies by as much as 22 percent, adding $2 trillion to the global economy.

Excitement about that potential can lead to a clamor for a general “technical reskilling” of the workforce. Companies know that their people will need new skills for the digital world, but they don’t always stop to think hard about the details. What are the specific skills our organization requires to succeed in its digital ambitions? Which individuals need those skills and by when?

If they don’t answer those questions first, perhaps under pressure from leadership to “digitize now”, companies face two risks that can jeopardize the success of capability building efforts. They may invest time and effort developing the wrong combination of capabilities, meaning individuals, or the whole organization, face critical skills shortages down the line. Or they may lose the confidence of stakeholders, with potential learners unwilling to engage because they don't see the relevance of the skills they are being asked to develop.

Knowing your needs

There is wide consensus among learning professionals that a learning needs analysis (LNA) process is the critical step that links capability building efforts to the desired business outcomes. LNA follows a straightforward logic. First define the business problem. Next identify the proposed solution. Then determine the skills required to deliver that solution and compare those requirements with the organization’s current capabilities. Finally take the necessary steps to fill the gaps.

The experience of Tata Steel in Ijmuiden, Netherlands, shows how learning needs analysis can underpin a successful digital transformation. The plant’s implementation of advanced analytics approaches to improve throughput, quality and productivity led to it becoming one of the World Economic Forum’s Digital Manufacturing Lighthouses.

When the company started to explore the potential business benefits of the new approach, it saw that results would come not from a handful of high-impact applications, but from hundreds of smaller projects scattered across its operations. That in turn would require a large number of people in new roles, including data scientists, data engineers and “digital translators” who could define problems and help to transform analytical insights into actionable changes to manufacturing operations.

To fill those roles, the steelmaker developed an internal Advanced Analytics Academy, which provides tailored training using real data and context-specific examples from the company’s operations. To date, more than 200 people been through the academy. The unit is also being used help managers transition into the digital world, providing courses in the fundamentals of advanced analytics and in effective ways to direct digital projects.

The day after tomorrow?

Aligning capability building efforts to specific business needs is vital, but companies also need to keep the bigger picture in mind. Change is continuous, and today’s business problems will be replaced in time by new challenges. While they can’t predict the specific capabilities they will need to address every future requirement, organizations can work to create the right underlying mindsets, encouraging their people to take ownership of their own development, pursuing personal growth in a culture of life-long learning.

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