Does $12,000 seem like a reasonable price for a bicycle? If you’re not a cyclist, it probably sounds ridiculous. But if you are, then you know that’s roughly the price of a top-end ride today. But is it worth it?
With bicycles, as with any expensive digital technology purchase for manufacturing operations, such as IoT, robotics, or machine learning, there are a lot of factors to weigh to determine which technologies should come first that offer value. And in both cases, it’s easy to get caught up in cool features, functions or specs versus what you really need to focus on based on goals.
Game-changing technology versus changing your game
Take the simple example of two people who set a goal to complete a 100-mile ride (or commonly known in the cycling world as a century ride) that’s three months away. Both of them have similar physical abilities and do a 25 – 30 mile ride a few times a week. To make the big hills in the ride easier, one decides to buy a recently unveiled ultralight 13lb bike that costs $11,000 but leaves her riding program mostly unchanged. The other decides to stick with her mid-range bike that weighs 17lbs but invest her money in coaching along with a heart rate monitor and tracking software to target specific endurance performance gains. In this situation, the second rider could lose the equivalent in weight savings from the lighter bike and is far more likely to complete the ride “comfortably” and in her targeted time due to her improvements in physical training rigor. The first rider will likely bonk, which is biking lingo for completely running out of energy to the point of struggling to keep riding. But will the bike actually help her? Probably a little bit, although the impact will be pretty insignificant compared to the investment. The second rider, on the other hand, will have extra money to spend on targeted equipment upgrades as she starts to maximize her physical potential and her goals change.
On some levels, this scenario is analogous to what often happens in business. In the face of a fast-changing competitive environment, maybe a digital technology becomes a hot topic in the industry press, or the word gets out that a key rival has adopted it, so it suddenly seems like a good investment in the race to eke out higher efficiencies or productivity. But even if the technology is game changing for the industry, you’re not going to tap its true potential in your business without certain process rigor and measurement fundamentals in place. Here is previous blog that talks about the value of seeing and measuring KPIs to truly understand how your business is performing and where improvements are needed before investing in technology. Most importantly, you need to ensure you have your finger on the pulse of critical key performance indicators that drive business performance and health. Only then can you:
- Objectively evaluate what’s really happening in the business
- Pinpoint what, where and why problems exist
- Make informed decisions on which digital capabilities you need to address your most pressing business issues and challenges
- Accurately measure the impact of investments and manage implementations for continuous improvement.
The elements of a strong KPI management foundation
Of course, as with anything else, accurately measuring and responding to KPIs in business is easier said than done. To get it right you need a good approach that includes:
- Data integration—Business is moving faster than ever, and most manufacturers need data from variety of systems to gauge business health and progress against goals. That’s why manual data input no longer cuts it. An automated integration approach is not only more accurate, but it provides data to users in time frames that they can actually act on (rather than weeks or months after the fact).
- Reporting and analytics—To monitor and evaluate the impact of process changes or digital transformation initiatives, you need customizable reporting and analytics capabilities that enable you easily drill down into what’s working and what’s not working and why.
- Alerting—If people aren’t able to address issues or problems that arise in a timely manner, then you’ll always be leaving value on the table. The best KPI management tools and approaches include built-in alerting features to keep the right people informed of issues so they are addressed immediately so goals stay on track.
- Problem solving—In the spirit of continuous improvement, you can’t fix something if you don’t know why it’s broken. Robust KPI management software that has the ability to identify the root cause of lagging metrics, and then guide users on the appropriate countermeasures, will effectively drive change and create improvements long-term.
In the end, in business as in sport, good digital technology is important. But what’s essential to getting the best possible results is working effectively day-in and day-out, week after week, month after month and year after year. And that starts with instilling process rigor, having the ability to easily track and measure ongoing results against goals and empowering your employees to utilize data to troubleshoot problem areas as soon as possible. With a good KPI management solution, like Dploy Solutions, you can see more, do more and make smarter decisions to improve your operations every hour of every day.
Learn more about how KPI management can underpins successful digital transformation
For a deeper dive into how a KPI management approach and KPI software can help you make smarter strategic technology investments, read our white paper: Your Digital Transformation: How KPI Management Software Can Ensure the Greatest Return on Investment.
VICE PRESIDENT, SUPPLY CHAIN & TECHNOLOGY
Ken is a 25+ year veteran of manufacturing, operational excellence and supply chain optimization. He believes that it is critical for organizations to address the challenges of strategic planning and use of big data in manufacturing. At TBM, Ken is actively leading the effort to our suite of services to include emerging technologies that improve productivity and convert complex data into information for improved decision making.