In January 2024, Quebec announced that it had helped 10,000 manufacturing SMEs create a digital transformation plan through its “Offensive Transformation Numérique” (OTN) program [1]. Beyond this important milestone, the Quebec government now wants to know how many of them will go from feasibility study to realization of their projects. This sentiment is shared by several companies, who are wondering how to implement their digital transformation. These questions also echo other studies and announcements made in the rest of Canada [2].
Digital transformation: a multi-project approach
Industry 4.0 encompasses a multitude of technology groups that can be applied in different ways to meet different business needs. As a result, it would be difficult for a company to achieve its digital transformation through a single project or by implementing a single system. Thus, the company must divide its digital transformation into several technology projects, each linking a business need to one or more technologies. Some of these projects will be long and complex, while others will be quick and simple, but all must be aligned with the organization’s digital vision and strategy. Finally, implementing a multi-project approach will involve creating a portfolio of digital transformation projects.
Using a multi-project approach enables the company to create the right circumstances around its digital transformation, while ensuring that each project brings its own gains to the business. The completion of each project then enables new digital transformation and improvement projects to be identified, which will gradually enable the company to achieve its objectives. Of course, all these projects must be aligned with the company’s digital vision and strategy, and each one represents a step towards achieving this vision.
Prioritizing digital transformation projects
While the creation of a digital transformation plan will help identify the various projects forming part of the project portfolio, prioritizing these projects can be a challenge. To facilitate the prioritization process, several elements need to be taken into consideration: the context of the organization, the specific characteristics of each project, and the interdependencies of the project portfolio.
Company context
Every company is different, so it’s essential to consider the context of your organization in order to prioritize your digital transformation projects. One company might have a set of project management processes and tools, enabling it to quickly take on complex projects, while another might use its agility to carry out many simple projects on an ongoing basis. It is therefore necessary for the company to consider its internal processes, resources, existing technologies and culture, in order to prioritize projects that can be carried out with its current capacity.
Project characteristics and interdependencies
Beyond its own context, the company must also consider the characteristics and interdependencies of the various technology projects identified during the audits and the creation of the digital transformation plan. Some projects may be less complex and have less impact but could be easier and quicker to deploy. Other projects could, for their part, make it possible to obtain the data or functionalities needed to ensure the smooth operation of a system deployed in another project. Finally, some projects may well run simultaneously, to benefit from synergies in terms of the organization’s resources and infrastructures.
Moving from simple to complex projects
A prioritization approach put forward by several organizations favors simple projects over complex ones. This approach enables the implementation of small, rapid digital projects, providing almost immediate benefits by addressing a recurring problem. These projects are generally easier to manage and align with the organization’s context, facilitating employee and management acceptance of a broader digital transformation. Of course, this does not mean that complex projects such as the replacement of an Enterprise Resource Planning (ERP) system or the implementation of a Manufacturing Management System (MES), both of which are complex systems, should be postponed until all the simpler projects have been completed. As mentioned in the previous point, project prioritization must also consider how one project can provide the functionality needed for a future project to run smoothly. In some cases, therefore, it may be preferable to prioritize a complex project that can provide a large number of founding functionalities on which simpler projects can then be built.
Learning by doing
Although it may seem counter-intuitive, it is not necessary to implement a complex set of project management and project portfolio management processes and tools in order to successfully achieve digital transformation. On the contrary, recent studies carried out with several SMEs have shown that it is preferable for companies to start their transformation with simple tools and processes, and then evolve their project management according to their achievements [3] [4].
Indeed, as the company carries out and manages its transformation projects, it learns to exploit the underlying technologies, enabling it to identify new potential projects and avenues for improvement. Equally, the more digital transformation projects a company undertakes, the more it learns to manage its projects effectively, and to integrate this management into all its internal processes and operations.
This is why it becomes important to consider, when prioritizing and carrying out projects, the potential learnings that will result, and how these learnings will promote faster and more effective progress towards the company’s digital transformation. Furthermore, in the course of these learnings, the company will be able to identify incremental organizational changes (upgrading tools and processes, changing roles and responsibilities, adding new resources and expertise, etc.), which will enable it to leverage these learnings and increase its efficiency in managing its digital transformation.
Surround yourself with experts
One of the critical success factors of any digital transformation lies in acquiring the necessary expertise for each project, whether by recruiting new resources or through experts from outside the organization [4]. The experience of these resources will be essential both in prioritizing and planning projects, and in implementing and managing technologies. By favoring this approach, companies benefit from an objective eye and greater flexibility, ensuring success in the adoption of their digital plan.
In conclusion, the most important element in ensuring the success of any digital transformation is simple: carry out an initial project. Completing this project will enable the company to understand the real impact of these technologies, how they work and how to manage this type of project. This will have a snowball effect, giving the organization the impetus it needs to implement its digital plan.
So, the question you need to ask yourself is: are you ready to take the plunge?
[1] Radio-Canada, «Transformation numérique : Québec a accompagné 10 000 PME, selon le ministre Fitzgibbon,» 12 Janvier 2024. [En ligne]. Available: https://ici.radio-canada.ca/nouvelle/2041309/transformation-numerique-quebec-10000-pme-pierre-fitzgibbon.
[2] Pacific Economic Development Canada. “Government of Canada invests almost $14 million to drive innovation and economic growth in Vancouver”. March 14, 2024. [Online]. Available: https://www.canada.ca/en/pacific-economic-development/news/2024/03/government-of-canada-invests-almost-14-million-to-drive-innovation-and-economic-growth-in-vancouver.html
[3] J. Brodeur, I. Deschamps et R. Pellerin, «Organizational changes approaches to facilitate the management of Industry 4.0 transformation in manufacturing SMEs,» Journal of Manufacturing Technology Management, vol. 34, n° 7, pp. 1098-1119, 2023.
[4] J. Brodeur, R. Pellerin et I. Deschamps, «Operationalization of Critical Success Factors to Manage the Industry 4.0 Transformation of Manufacturing SMEs,» Sustainability, vol. 14, n° 8954, 2022.
AUTHOR
Jonathan Brodeur, Eng., Ph.D
Team Leader / Project Manager – Industrial Engineering
Jonathan has nearly 10 years of experience in the manufacturing industry, including 5 years dedicated to supporting and advising manufacturing SMEs. With a bachelor’s degree in aerospace engineering, a master’s degree in industrial engineering and a doctorate in industrial engineering focused on managing digital transformation in SMEs, Jonathan has worked for several manufacturing companies in the Greater Montreal area. Over the course of his career, he has been instrumental in setting up the Centre d’expertise industrielle de Montréal, which specializes in supporting manufacturing SMEs in their digital transformation, as well as starting up MILA’s AI Activation program, which specializes in demonstration and proof-of-concept projects in artificial intelligence for SMEs.