Sustainability in the Digital World: Do’s and Don’ts

By Sairam Bollapragada

While the entire humankind is going ga-ga over the word Digital, there still seems to be much struggle around organizations in creating a Digital transformation blueprint/value and adopting the same quickly.

This note is an attempt to bring to table salient features of becoming Digital relevant in true spirit and deeds. Let us take the points, one after the other:

  1. Goals and Objectives: An Organization should ask itself if they have a dossier which explains to all its employees what Digital means to their business. It is not mandatory that all aspects of Digital should mean something to you. Pick the relevant ones which are critical to your business and get started on the transformational journey.

 

Organizations should get aligned to their clients (both current and potential) on how they can leverage your Digital capabilities to strike a chord with the digital needs of their clients as well. Hence the sales teams should understand the needs and current capability. In fact they should be the first agents of the change to bring to table the digital market needs and hence what we need to nourish as capability.

 

The upskilling is the next most important action. Since the entire demand is moving towards Digital, your upskilling plays a strategic role. The two cannot be misaligned considering even the short term requirements.

 

  1. Adaptability: Your strength to react to the changes in market demand is very critical if you need to be seen as the early adopters in the market . Understanding the market conditions and demand fast, acting to invest in a skilled workforce faster and be the first implementers is essence – which all sums up to reflect on how Agile you are as an organization. You may have to ruthlessly clear the clutter or legacy clingers who can become a challenge to the road to transformation. This will also help your perception in the market and make your sales teams to approach the market with that much more confidence. Unless you up your risk antennas, the conviction will be missing in your commitments. The challenges are greatest learning tools which prepare you to handle bigger commitments. Hence create a risk taking culture that thrives on innovation and experiments.

 

  1. Change Management needs to be carefully crafted out of a network of sources which should become your strongest source of drivers in enhancing your objectives of Digital transformation. Change. When inevitable has to bring in objectivity to avoid chaos. In the Digital space, it pays you richly through both internal and external partnerships. Co-creation is a critical component of this Change process. Please refer my earlier blog: https://itservicesdelivery.wordpress.com/2016/12/05/digital-transformation-looking-outside-for-a-change-agent/

 

  1. Congenial Work Environ: The culture of clinging and hugging often seen as threat to change, is led by folks who don’t want things to change as it reflects their insecure mind-set. Millennials must be provided a platform to bring in fresh ideas through their out of box creative minds. They don’t carry any baggage and hence you can almost always expect a fresh bag of ideas. Once you encourage such an environment, ideas will flow automatically. Let the owners of execution incubate these ideas and convert them into compelling propositions for their clientele. The more fresh ideas you take to clients, the more your probability as being perceived as a leader in the space. Remember perception management is also very critical across the ecospace. Strategic initiatives cannot be allowed to be held ransom to the feudal mind sets of folks obsessed with large teams. The question then to them is – how would you embrace the upcoming digital twins in your workforce.

 

  1. Focussed Teamwork aligned to Objectives: In the services business of annuity, we seem to understand a lot about value creation. We try and demonstrate through our PIPs (productivity improvements), CoD (Cost Of Delivery), etc. However, with the advent of Digital and Automation, the client’s expectations have gone exponentially wild compelling all service providers to think radically different. Hence the above point 4 holds that much more water. Most persons facing the client needs to come across as your digital brand ambassadors (if not all). The approaches you position to the clients should prove your thought leadership. Often the rift between what is sold and what is delivered leaves a bad taste with the clients. This is a true reflection of what lack of orchestration within the teams. Hence your need to align all the teams to speak one language of offerings-capabilities-capacities to establish credibility.

 

Last but not the least, every Digital customer is looking for uniqueness in the solution being delivered. So please be very cautious before you replay a plethora of offerings while you showcase your might.

Real Time Supply Chain Analytics

Real Time Supply Chain Analytics

By Sairam Bollapragada & Rajesh Mohandas

Supply chain managers have seen increasing challenges to create, and keep, efficient and effective supply chain methods, Customer Service, Operating Cost Control, Planning and Risk Management, Inventory Control, GTM Speed, Supplier / Partner relationship management, Green Supply Chain and Talent (Resources) are a few burring issues that are on the top of the charts that burn the midnight oil. A survey by McKinsey says the companies who have already engaged in leveraging Digital Technologies have managed key trade-offs on barriers to better performance : raising risk, lack of collaboration and low CEO involvement.

The fall of this decade has seen major shift in the supply demand dynamics, the traditional supply chain solutions are not equipped to handle complex scenarios due to lack of visibility. There is a competitive demand for real-time responsiveness which can be addressed by the combination of Data Science and Emerging Technologies connecting customer service with Social and Mobile platforms that are cloud enabled on one hand and strengthening visibility into operations with IOT based real-time analytics. The icing on the cake is emergence of machine learning which is all set to address the tactical challenges and give signature ready recommendations for decision makers to gain maximum mileage.

Supply chain management will gradually be disrupted by the rising adoption of IoT and advanced analytics.  The challenge faced by the supply chain practitioners and players is inability to take advantage of technology to the fullest extent while they are trying to simultaneously integrate their supply chain systems across a much wider range of information sources due to lack of 360 degree view of both business and customer.

  1. Strategic Planning: The very first component of the supply chain, Strategic Planning, comprises of Strategic supply design and Strategic sourcing. Here real time analytics can be used for Supply Chain alert monitoring and the insights will flow into Long term planning, Bid Management, Contract management, Catalogue management and Source determination, real time information can be accessed by decision makers that are geographically dispersed to take collaborative decision on a cloud enabled mobile application. 
  2. Demand Planning: The Next component of the supply-chain value stream is Demand Planning the three crucial capabilities here are Forecasting, Promotions and Demand Consensus. Advanced real-time analytics help with Macro calculations and planning bill of materials leading to collaborative demand planning and characteristic based forecasting.
  3.  Supply Planning: The heartbeat for any supply chain is the supply planning which comprises of capabilities like Safety stock planning, supply network and outsourcing decisions, Distribution planning, Customer and Supplier collaboration. The best component in the value chain where Emerging technologies can be used with the fullest potential is here, the power of cloud enabled CRM systems and Communities connecting the enterprise giving a 360 degree view to the entire ecosystem including the suppliers, customers, partners and the enterprise following with the power of advanced analytics and big data enabled deep learning algorithms come handy. Some examples where one can leverage advanced real-time analytics are in the area of multi-level supply demand matching, whereas the artificial intelligence neural network algorithms can be plugged into supply network planning.

Procurement, Warehousing and Order Fulfilments are three equally crucial parts of the supply chain operations that are interlinked and often become bottleneck in the supply chain due to lack of visibility. In a connected supply chain environment the intelligent algorithms need to be plugged in here such that all three areas are interconnected and all repetitive processes can be automated through RPA, what with NLP loaded Analytics providing intelligence and insight into the process.

4. Transportation: The last component of the value chain is Transportation. Often the biggest complaint from the players of supply chain is “Visibility to the Tail”. This is already being accomplished by real time analytics, bringing in a predictive model that combines features like load consolidation, intelligent route optimization, carrier selection and shipment trending which are few elements of the Transport planning while the Transport execution can feed in data from the shipping interfaces capable of distance determination services. The last inputs come from the freight-costing component that strengthens the predictive model and the machine learning algorithm continuously churns the data and gives real-time insights for both strategists and operations.

Hence, Analytics working in tandem with Cloud, Mobility, and AI, can play a very critical role to bring in great value add to the Real Time Supply Chain scenarios for all those who embrace and leverage. This is even more critical with markets moving towards a more C2C value chain where the customer experience and expectations are fast changing. Retailers, Warehouses, Suppliers, Logistics, and all the agents in the Supply Chain have to work in an orchestrated mode need to be on their toes to remain competitive and relevant to the market expectations.

VUCA in Digital Manufacturing

By Sairam Bollapragada Sairam & Rajesh Mohandas

In our first part of this series Digital in a VUCA World we walked thru various facets of Digital being impacted, the first paper was domain agnostic and we will today focus on the impact of VUCA on DIGITAL MANUFACTURING!

 

Manufacturing roughly contributes to 1/3rd of the global GDP as per the world bank figures and approximately 10% of the global workforce is directly employed by manufacturing companies. The “Multiplier Effect” brings in nearly 37% of the entire global workforce is indirectly connected with manufacturing sector as per the Forbes. Compared to that of discrete manufacturing there is more technology penetration and today the emergence of Digital and Adaptive manufacturing has clearly redefined this prone-to-be disrupted sector, adding predictability, efficiency, effectiveness and above all cost optimization with improved productivity as challenges.

 

VUCA conflates four distinct types of challenges that demand four distinct types of responses; the need of the hour for companies during an economic downturn is business developers and not problem solvers or better a combination of the two.

 

Along with VUCA came the concept of working world 4.0. Derived from industry 4.0, the fourth industrial revolution, it names its immense and rapidly spreading impacts on many areas of work and life. It changes the way we communicate, get and read information and prepare decisions. The special feature of Industry 4.0 is networked manufacturing, i.e. the further development of digitisation through emerging technologies…

 

ART OF THE POSSIBLE in the VUCA world for manufacturing sectors leveraging Digital …

 

Volatility: The Manufacturers are increasingly becoming aware of the fact that to alter their manufacturing strategies face the raising volatility. One has to firstly understand the volatility exposure and assess how agile are internal business processes, the business operations and at least 75% knowledge about the customers customer in all three B2B, B2C and C2C markets.

 

Manufacturers are under constant pressure of continuously improving QPM, especially in the fluctuating market demand irrespective of the magnitude. One bad product and the digital reach being so large and quick, it can dent your credibility.

 

Big Data with Predictive analytics and bots leveraging machine-learning algorithms will bring in mechanisms to tackle volatility and hence automate a large chunk of the manufacturing process.

 

Uncertainty: The manufacturing sector has lived thru multiple uncertain eras and has indeed mastered the art of change management, in the digital world the same can be replicated with “USE-PREPARE-FOCUS-FIND” cycle

 

  • USE : use Data: Knowledge – Process – Technology, to arrive at strong data analytics platforms to predict and handle uncertainty. Data lakes can help drive multiple inferences and leverage on historical information. The shift to Virtual prototyping, IoT based surface modelling QAC, Sheet metal design, CAPP, AR based marketing, process simulation, are all areas that need to be understood well.

 

  • PREPARE: be well prepared to tackle situations raising out of events unknown, with digital technology like cognitive computing, neural networks, artificial intelligence algorithms etc. to speed up effective decision making capabilities with a “First – to – Market” objective. Prepare well to use tools like SAMCEF, NASTRAN, ABAQUS (to name a few), etc. for FEA, embedded M2M based information analytics, Connected Device Platforms (CDP), AEP, etc. You need to move fast and as much to Intelligent Manufacturing.

 

  • FOCUS: The market is shifting towards customer specific demand fulfilment, hence analytics, cognitive computing and plethora of such tools available can help you focus on very specialized “M2C – Manufacturer to Customer” markets – hence the agility and reach. Continuously focus to improve the PLM, from conception to service and disposal.
  • FIND: the digital marketing and media provides platforms for very fast feedback which can be leveraged catalytically to improve the products and build variants, thus maximizing footprint.

 

Complexity: Looking the way Digital Manufacturing is being challenged, the four influencing factors are:

  1. optimized resource usage,
  2. shortened lead times,
  3. personalized fit-to-purpose manufacturing,
  4. increased (squeezed?) productivity

(refer https://itservicesdelivery.wordpress.com/2016/05/05/digital-manufacturing-through-industrie-4-0-2/)

 

The complexity in the Digital Manufacturing space is predominantly, due to the fact, that manufacturing is shifting focus from pure play product philosophy to Product & Services philosophy. Hence, the challenge shifts to balancing maintenance with production.

 

Ambiguity:  

Haze in vision to the roadmap on how technologies can better your product or services can be a killer. You need to have a dynamic strategy which keeps refreshing its goals every 6 months to a year. 64% of the leadership time is being spent on articulating shared vision as per a CII-EY report.

 

Any organization unclear of the path it wants to tread to embrace technological advances to transform itself, will not be kindly treated by the market demands and especially in Manufacturing segment. In fact, the Industry 4.0 is exactly about that. 27% of the so-called $19 Trillion Digital economy is due to the manufacturing sector.  Hence in this ambiguity (though not a choice anymore), crafting out leadership opportunities can be indeed be an opportunity.

 

 

Manufacturers, with so much at stake, simply can chose either to run the race or to become legacy as they are challenged every day to the field by new and modern entrepreneurs who are coming up with some very interesting and disruptive innovations continuously shifting the co-ordinates to newer business parameters. The VUCA in DM is all of that – to be strategized and attacked in a truly multi-pronged approach.

 

VUCA in the Digital world!!

VUCA in the Digital world!!

By Sairam Bollapragada & Rajesh Mohandas

Across the globe, all are now connected in unprecedented ways. This is both a boon and a bane, where we live in an era that is transforming and setting stage for the next revolution. Times when we were disconnected and every country operated in silo the challenges were limited to the internal affairs and the near border conflicts only.

With technological advances where today we look at a bright and secured future on one hand, on the other hand the unrest continues and is growing bigger day by day, conflicts, civil unrest, terrorism, ransom ware, cyber crimes, etc… are now integrated into our daily life.

The digital reality is shaking up some of the beliefs and compelling us to move to a more knowledgeable IT economy what with automation and AI which were limited to books, have finally come to the open challenging how that can transform every space of the life. Soon all white-space is expected to be filled with cognitive behavior and techniques. Automation is forcing re-wiring of skills for many of the IT workforce (read : https://itservicesdelivery.wordpress.com/2016/04/11/the-digital-era-learner-re-wiring-your-skills/ ) spelling end of the careers if not done.

Hence one can relate to the 4 key parameters of VUCA : Volatility, Uncertainty, Complexity and Ambiguity. Each of these factors are challenging the order of the day stuff and hence the need to cope with the same in the turbulent times.

The compounded problem statement with external influencing factors from market pressures, competition, shareholder expectations, stakeholders, are strong indicators, to the fact that the leaders will need to be hard wired to resilience.

The role of the leaders managing workforce, will be crucial and critical in shaping the digital future of any organization.  Most of the requirements to support a digital environment are not about the technology per se, but it is also about creating the environment to re-skill, create flexibility to be agile, adopt to changing demands, and groom the right talent for a safe digital future.

Let’s take each of the parameter at a time to see what it means in Digital world:

(V) Volatility: The nature and Dynamics of change that is blowing across the landscape mandates catalysts to adopt to these changes. The legacy of efficiency and productivity will no longer continued business anymore. Disruptive innovations are indeed unsettling dominant industries in today’s world. Hence the times call for compulsive innovation and a drift away from SOPs.

U (Uncertainity): This is a factor which reflects the lack of predictability and many surprises. Another indicator of this is the refusal of the current technology wave to move easily beyond the labs. The ever-experimenting mind-set is also reflecting that the solutions themselves are prone to obsolescence, from the very moment they are conceived with high degree of unpredictability.

( C)Complexity:  Multiple parameters built into the character of the issue spells complexity – be it chaos or confusion-led issues.

Complexity can also reflect multiple influencing factors which can unsettle easily. Complexity is good or bad depending on your strategy. Having a bullet proof strategy is impossible – nevertheless one should have a solid strategy to counter complexities and challenge the same.  Even if it comes with short expiry date (2 years) you should have one.

Digital space is getting more and more complex with each passing day rolling out a new platform, new innovations coming to light, new solutions offered, disruptive models coming to life, etc. Hence to deal with all these changes, a strategy for managing this change is mandatory and thus the

(A)Ambiguity : The fact that we only know 40% of how technology will fold into the lives and markets as an influencer, is a true reflection of haze in the Digital space. This then raises the question of business risk, which is quite a reality today.

At various levels of an organization, there are ambiguities relating to progression and growth, whether at organization level or career levels of professionals.  Except for the lexical meaning of the Strategic and Tactical approaches, the lines are thinning out.

Volatility, Uncertainty, Complexity and Ambiguity will continue to exist but what leaders today can do is to play a vital role and attempt to control the levers by moving in to a Hyperawareness zone of informed decision-making, and fast execution. Winning in the Digital Vortex is not just about algorithms, architectures or innovative business models; it requires organizational change and workforce transformation. And successful transformation is enabled by a company’s digital business agility, building on the fact that people are an organization’s most important asset. Hence, everybody is but compelled to think on the forward thinking strategies to adopt to the Digital VUCA scenarios….

Why existing estimation tools are not realistic for Digital Project Estimation

Why existing estimation tools are not realistic for Digital Project Estimation

by Bollapragada Sairam, Rajesh Mohandas, Dattatreya Rao, & Ravi Pandikunta

Digital for some executives is primarily about the technology. For others, digital is a new way of engaging with customers. And for others still, it represents an entirely new way of doing business. None of these definitions is necessarily incorrect. But, the variation results in piecemeal initiatives and misguided efforts.

Industry experts have started to believe that digital should be seen less as a thing and more a way of doing things … this creates complexities with respect to estimation, how can one estimate and cost a concept. In digital projects “basic concept” is a starting point for estimation, or at least an idea, but it’s loose and not particularly well defined. Sometimes that’s because there hasn’t been time to develop it or there simply isn’t the ‘appetite’ from the creative to think through the detail.

Unlike traditional development parameters, the Digital World carries many more and they are unique in nature, variety of products, applications, data bases, technologies, middle-wares, hosting types and the entire eco system. Few more elements such as, sensors/devices, platform/infrastructure, testing, integration, security, scalability, robustness, seamlessness are multi folded efforts in development.

 

Some cost estimation models used in software development today are

Cost Model Description Best Fit Environment Formula type
COCOMO Constructive Cost Model Large corporate and government software projects, including embedded firmware Logarithmic
COSYSMO Constructive Systems Engineering Cost Model Large corporate and government projects, including embedded firmware and hardware Logarithmic
FP Function Points Software projects of all sizes, mainly desktop OS based platforms Linear
WMFP Weighted Micro Function Points Commercial software projects of all sizes and environments, including embedded firmware Linear
REVIC REVised Intermediate COCOMO Large military software projects, including embedded firmware Logarithmic

Some typical challenges with traditional estimation techniques in software development:

Unlike other industries, here often the estimates are done with partial data and sometimes with incorrect data, too. Several techniques / tools have been introduced over the years to make the process systemic and not a gut-based guesstimate. However, lapses still occur and this is still one of the toughest to-dos for a project. Following are few more parameters

  1. Poor design: Poor design results in unnecessary code tweaking and heavy-duty maintenance applying pressure on schedules.
  2. Not splitting the tasks enough: Most common method is to split project tasks into a WBS, but sometimes they are not broken enough to be conceptualized with clarity.
  3. Top to bottom scheduling: This is a practical problem one needs to deal with. Instead of doing bottoms-up estimation, most projects start with – “I need this done in 6 months” and then a work breakdown is done where the task estimates are retrofitted inside these 6 months.
  4. Factoring the dependencies right: Often, an external dependency or a decision point is missed-out causing the project to suffer, this is “coordination neglect”.
  5. Factoring right buffer: This is a common challenge and there is no simple formula here.
  6. Analogous Estimation Risk: Often, project estimates are done based on an expert judgment or from past projects’ experience. While picking an analogy and mapping the estimate might seem like an intuitive thing to do, it’s often risky because of the numerous variables in a project and the unique elements and dependencies, the people involved and their skillset, diverse tools and technologies adopted and the infrastructure and resources in place.
  7. Ignoring Team Capacity: There is a lot of debate about what unit or estimates need to be factored – should we measure complexity, time or effort? Irrespective of what unit is followed, many Project Managers tend to ignore considering their team’s capacity. It seems obvious that different people would take different time to code, but when we draw estimates, we come up with a standard effort estimate.

One other challenge is not only the technology but also the periphery elements on the topology, network, security and emerging areas like Artificial Intelligence, Autonomous vehicles, Cloud Manufacturing and 3d Printing, IoT and Connected Devices, Robots, Drones, and social media platforms couple with decisions on the emerging approaches like DevOps, Dockers, Microservices etc… add further complications into the estimation cycle.

Changing expectations from the customer are forcing service providers and manufacturers into a hyper personalization spiral, thus adding cost pressures. In these cases, the technology needed to solve our problem is well established indeed; in fact, it’s possibly the most important technical innovation in the history of humanity ranging from B2B, B2C, B2M, C2C etc…

The players in the market too have made the situation complex, though each provider promotes “On Demand and Pay as you Go” models the terms and conditions are quite different, for example the pricing metric in case of AWS is number of messages, Cisco looks at Cellular, GE bills on number of instances, IBM looks at data ingested and bills accordingly, Microsoft costing is depended on Number of messages, devices and feature set while SAP looks at an annual fixed subscription model and there are many more such elements to consider in your costing model…

The exponential growth in the technology as well as diversification of the same, new solution components, hyper-personalization, and other needs, all mushrooming towards building of modern solutions; but one cannot ignore that there is a dire need for building standard cost estimation frame-works where the conventional methods cannot be afforded….

The THREE “R”s as outcomes of Automation!!

The THREE “R”s as outcomes of Automation!!

By Sairam Bollapragada

IT has been predominant for its people and associated costs. People have been the epicenter of all the transformation/automation and the benefits measured have always hovered around the people, the efforts, their packages and associated costs.

These are the days of automation, machine learning, artificial intelligence and introduction of robotics. We are creating digital workforce, in a big way to transform the way we deliver solutions and services today.  Due to cost pressures, many times, evidently the quantitative savings take advantage over the qualitative ones. The more demanding clients do not budge on either.

The bi-modal approach on what you can do better with our existing work in your scope as well as what else you can do with our other work with other vendors is becoming a natural ask by clients. This then creates the platform to compete and who brings what to the table matters. While everybody seems to be selling the concepts and ideas, the rollouts from adoption is slow as indicated by a recent report. Hence, the benefits slowly reflected in the books.

Many a times, the teams are not able to articulate the savings and calculate on how do we arrive at the magical savings number and translate that to dollars. The efforts thus required to deliver the same service with the productivity improvements should lead to benefits that can needs to be captured and reflected.

All the benefits can be thus, categorized into THREE R’s that relate to the people aspect as follows:

  1. R1: Resize: when transformation/automation saves engineering effort and hence the cost of solution/delivery drops, you can release few team members. This resized team can deliver the same volume of work or keeping the same team size can take up more work. In typical annuity projects, one can re-plough the saved effort to create additional work in terms of additional tickets or CRs, either with no drop in revenue or additional revenue.

 

  1. R2: Restructure: while betting big on outcomes of automation, one can expect the productivity of the team as a whole to gain upward momentum. This should lend the capability of the higher end of the pyramid to delegate the some of, if not all their tasks to the lower band teammates. This is a true indicator of productivity improvement.

 

  1. R3: Resite : In all engagements, many times we come across mandatory set of tasks that should be done onsite or at client’s site. Transformations/Automations can also bring in the capability to move those tasks offshore bringing down the cost of solution or engagement. This may add to your bottom lines or you may choose to pass on the benefits to the clients. Whichever way, more presence of tasks at offshore has always been a strong indicator of confidence levels of delivery as well as capability of the team.

However, when it comes to benefits @ R1 or R2, there is strong feeling that it only leads to job loss. Positively put, it can aso mean the higher band resources can be released (and if they are very capable) where they can be deployed for account mining or/and other transformational consultant roles to demonstrate technical prowess or thought leadership in different areas – both  focused at increasing the footprint from growth standpoint.

If we don’t embrace automation/transformation, somebody else may move your cheese. Till the outcomes hit the financial books, the last mile is not accomplished….so, we must compel ourselves to drive these market-mandated changes, as long as the choice is still with us….

The Need for Intelligent Command Control Center for Robots (IC3R)

By Sairam Bollapragada & Rajesh Mohandas

It is predicted that the industry economy whether IT or non-IT, will go full throttle in the upcoming FY 2017-18 to create a financial realization called autonomics – unlocking the potentials  of robots that are being conceived. Over 2.5 billion people have at least one messaging app installed, within a couple of years that will reach 3.6 billion, about half of humanity. (Source: The Economist) However, the outcomes as suggested by many big market research houses have not been up to the desired expectations. With the things heating up around automation and artificial intelligence/RPA, we can foresee that we will be very soon seeing an increasing need to have some solid controls in place.

The Industry economy in the coming days will create a financial realisation called autonomics – unlocking the potentials of robots that are being conceived and driven towards this direction. However, the outcomes as suggested by many big market research houses have not been up to the desired expectations. With the things heating up around automation and artificial intelligence/RPA we can foresee that we will be very soon seeing an increasing need to have some solid controls in place. Today, the market is focused on Industrial Networks, Industrial Robots, Machine Vision, Control Valves/Devices, Field Instruments, Enclosures and Cables.  Each of these components have an IT and a Non-IT element with technology landscape consisting of SCADA, PLC (Programmable Logic Controllers), PAC (Programmable Automation Controllers), RTU(Remote Terminal Units), DCS (Distributed Control Systems), MES (Manufacturing Execution System), PLM (Product Lifecycle Management), HMI(Human Machine Interface), and above all Safety.

While creating new technical solutions every day and getting excited with it, we are probably too casual on the flip side of the consequences. Lets focus on the negatives for a moment – what if an unmanned vehicle had a bad bug? or what if the programming in the automated manufacturing plants were intercepted/hacked altering the desired behavior or leading to disturbing outcomes?, it can become a nightmare!! For example a recent crash involving Uber Technologies Inc. driverless car suggests autonomous software sometimes takes the same risks as the humans it may one day replace. While we are creating bots at an unprecedented speed and passion, we may also need to secure these advancements through a control mechanism, which will help us to have the desired outcomes, intact. The technological singularity will compel us to start thinking on automatic recovery with deep machine learning capacity.

Hence, are we talking about having a Command Control Mechanism to protect the desired outcomes of all the automated bots whether Soft or hard? The answer is yes. We need to soon develop and establish command control centres for a set of digital work force you want to monitor on a continuous basis to ensure they are aligned to the expected behavior patterns. In fact, there should be a proper set of guidelines issued by the state agencies before allowing any robot to go commercial in the market. The audit and strictures will help control the release of un-certified or Rogue robots. This would be especially true with the craze of smart cities catching up like around the globe. The creation of the digital twin space is also something that must be looked into seriously for potential disruption.

A command control center will help in creating a centralized monitoring service which will track monitor and report the behavior of these bots while positively looking at it, it could also lend performance improvements towards the desired outcomes. What with the introduction of aggressive mind-control technology and Drones we should have a proper access control on this technology based robots. A C3 with an end-to-end visibility across robots with real-time rolling view to help us have a central control of work schedules, job cards, execution, and support for various robotic activities

While the support for high availability/disaster recovery and network load balancing is the intent, the central control mechanism, will be mandated to have a cyber-cop kind of functionality. For example, while monitoring the bunch of UV Cars, suppose an unmanned vehicle on road was malfunctioning, one should have the ability(or create one) to monitor it in real time and stop the functioning of the engine remotely to avoid any major disaster.

A secure central monitoring system laced with analytics, could be enabled through the log base where robots pass on every information pertaining to each activity they are instructed to perform. With this much of an information being logged, one can get a deep insight into the business and the activity patterns being conducted by or through robots. With so much of information at our disposal one can really create a very good analytics use case to understand and comprehend the behavior of these robots as they are unleashed into the market.

The global industrial automation market is extremely fragmented due to the presence of several players in the global market. Some of the leading players operating in the global market are ABB Ltd., FANUC Corporation, Honeywell International Inc., Toshiba Machine Corporation Ltd., Yokogawa Electric Corporation, Emerson Electric Company, General Electric Company, Yaskawa Electric Corporation, Rockwell Automation, Inc., Mitsubishi Electric Corporation, and Voith GmbH.

However, while doing a cherry pick of the best of the lot or robots to make their organizations more productive and efficient, we hope that the focus will begin from creating a solid Intelligent Command Control Center upfront to monitor, maintain, track and continuously do course correction for these disparate bots – soft and hard alike. The industrial control and factory automation is projected to reach USD 153.30 Billion by 2022, at a CAGR of 4.88% during the forecast period and hence the emphasis. The state agencies must work towards evolving policy guidelines within and beyond for all entities looking to employ the automation-Digital bots effectively.

Getting Smart with Digital CapEx

By Sairam Bollapragada & Rajesh Mohandas

History has taught us an important lesson in decision making, one such postulate is to look for long term losses before eyeing at short term gains. The recession of the early 1990s describes the period of economic downturn affecting much of the world in the late 1980s and early 1990s. The global recession came swiftly after the Black Monday of October 1987, resulting from a stock collapse of unprecedented size which saw the Dow Jones Industrial Average fall by 22.6%. While the Progressive Conservative government of Brian Mulroney in Canada and the successful election campaign of George H. W. Bush in the United States may have been aided by the brief recovery of 1988, neither leader could hold on to power through the last part of the recession.  Both were swept from office by opponents running on pledges to restore the economy to health… the decade of 1990 saw significant change in the global economy with a wide emphasis towards SERVICE DRIVEN ECONOMY.

Thanks to many technological developments over the past half century, today we have instant access to a vast array of information sources and are able to exchange new information with the rest of the world in real time. The tremendous increase in Internet access has brought people, businesses, and countries closer, while mobile communication has become cheaper and more accessible. International virtual global communities’ formation was available with forums to exchange and discuss ideas, create path-breaking solutions through innovative crowd-sourcing, etc.

The world economy is 6x larger than it was half a century ago, growing at an annual rate of 4% during the period. New technologies have paved the way for more efficient production systems in a wide range of industries and promoted economic growth. One such significant transformation one can notice from the 1987 Black Monday until today is the shift in mind-set from ownership to collaboration which gave rise to the “AS A SERVICE” thought process, and eventually as-a-service economy. The could computing references can be drawn from the visionary John McCarthy who wrote “computation may someday be organized as a public utility”. Furthermore, the 9/11 attacks and the double dip of early 2000 brought in a complete transformation where corporates shifted from CapEx to OpEx, multiple start-ups grew as mushrooms and died a natural death due to lack of right planning and investments.

Fast forward >>… Today, when compared to the earlier generations, the millennial generation has accepted security threats and larger risks as a part-and-parcel of daily life and is more futuristically optimistic. Entrepreneurs of the future have realized that growth needs right upfront investments and that will be reaped for a long time operational expense savings heavily. However, the point to remember here is that the famous theory of Pay-as-you-go and On-Demand are tied with Inflation that impact your budget. The start-ups with right business case today hit venture capital companies who are eager to invest and wait for long run to reap the benefits.

The transforming technology of tomorrow needs to invest in the right spots today, unlike the 1980’s to 2010 where things were more focused on leveraging technology to support business, the last few years have seen disruption with technology driving the business and no more playing a supportive role. Today the big elephants of the yester era who ruled the fortune 500 are reporting an annual growth of 2% to 5% CAGR while companies that are into the Digital business are reporting multi-fold gains – Facebook is one such example who reported a whopping 117% growth in the previous quarter.

The significance of CapEx in business budgets is that it demonstrates how much a business is spending to invest in its future. The OpEx which was critical in the services industry where a string of large clientele were focussed on annuity and service continuity business, had compulsions of pushing CaPex down for long. However, in the Digital era, the two are flipping ratios and priorities attempting to come to terms with the reality of the Digital-business-quotient fuelled competition. In many cases, the CxOs are blurring the line between CapEx and OpEx.

Talking about Digital Economy, the pushing of Digital envelope is becoming critical to the survival though, for example, investment in cloud would not necessarily mean better software quality or faster development. If your or your clients IT organization has very rigid operational silos, cloud can still not improve the business Agility. You may only be shifting the ‘speed to deployment’ problem to cloud.

Similarly, when you speak of mobility, creating your software services to ‘availability anywhere’ work culture within or outside of an organization requires investment into creating these lighter versions available on range of devices.

revenue-and-ebidtaEvery econd day there is news about the Fortune five hundreds foraying into TRANSFORMATION JOURNEY, but unfortunately they are marginal continuous incremental improvement they are engaged in and not breakthrough transformations. To survive and just not to sustain (growth comes later) out of box and breakthrough transformations are becoming new norm of the day. Smaller entrepreneurs are bringing in implementable ideas to the table pretty quick and fast thus challenging the big white elephants who have been resting on their laurels for long. OpEx evangelists promote the ideas that “money available at the present time is worth more than the same amount in the future due to its potential earning capacity”, on the other hand the raise of quick win is impacting long term investment decisions regarding CapEx which are critical not only because of the size of spend, but also from the point of view of an organization’s strategic goals. “Imagine that you had to drive from New York City to Los Angeles. You’re in downtown Manhattan hopelessly stuck in traffic. Bicycle messengers are whizzing past. You jump out of your car, sell your car on the spot at a ridiculously low price, buy a bicycle and continue your trip to West Coast. As absurd as this scenario sounds, CxO’s do it every day when they make short term OpEx decisions for long term CapEx journeys.” The diagram on the left (IDC-June 2016) indicates strong wins towards longer customer retention in the digital turbulence. The longer the relationship, the better is the profitability (EBITDA).

Inertia challenges change in larger organizations and hence paves way for inorganic growth. The larger the organization the more complex it is to break the CapEx-OpEx norms. Hence the redefinition of CapEx-OpEx is becoming more compulsive. WhatsApp and Facebook together in the past couple of years have built one of the largest customer bases in the social media market making itself a very powerful influencer in the digital space. Shopify, a Facebook’s e-commerce platform with social media integration is waiting to happen with approx. 500 million targeted users. This is indicative of entities who are thinking radically different to stay ahead of the curve. Now one wonders where the lines between CapEx-OpEx were drawn in this context….!

The Railway Fleet Planning – Digital way!

By Sairam Bollapragada & Rajesh Mohandas

In our last blog on the topic (https://itservicesdelivery.wordpress.com/2016/11/30/digital-in-rail-fleet-management-a-viewpoint/), we had a perspective about the railways fleet management.  In this sequel, we wish to bring on the aspects of Fleet Planning through levers from digital perspective and highlight a few important KPIs today as eyed by the railway planning commission. Fleet planning for any logistics entity is a continuous activity.

Fleet planning basically need to answer two most important questions, which locomotive is needed where and when – and when to acquire (buy / hire) one.

The most critical KPI the fleet planners need to be equipped with is a 360-degree view of the enterprise connecting the decision makers with information regarding its Vendors, Customers, Fleet Assets, the market intelligence to meet expectations. The very reason for such an infrastructure lack exists today due to disparate and disintegrated systems where in most of the countries data collection is still manual in many ways.

The rail network is increasingly busy – the number of passenger journeys made has risen by 70% across the globe over the last decade while US alone operated 1,471,736 freight cars and 31,875 locomotives and originated 39.53 million carloads (averaging 63 tons each) generating $81.7 billion in freight revenue for FY ‘16. So it’s important to make best use of the capacity through effective timetabling, and the right decisions about where to invest in developing the network, Planning and operating the network as seamlessly as possible in line with the existing and future demand. A few of the global KPIs measured and monitored by all railway operators are

  1. Asset Utilization (Train Km per Track Km)
  2. Efficiency (Planned track possession KM hour per track possession km hour)
  3. Service Quality and Reliability (Trains delayed due to Infrastructure)
  4. Innovation and Growth (Average relative age of fleet assets)
  5. Accessibility (Service coverage) and
  6. Safety (Accidental equivalent facilities per train km).

 

  • Asset Utilization

Logistics have a single goal even in asset planning, targeted at effective error-free stock management. Knowing item location, quantities on-hand, stock-outs, re-order triggers, space and scheduling, and how to minimize movement and manage assets in a harsh, high pressure environment, demanding growth patterns are only some of the challenges faced. Planning commission of Railways is constantly worried about the aging vehicles and tracks that need constant attention beyond the environmental and safety threats. Another critical area is to ensure consistency in operations while maximizing utilization. The statistics International Rail Journal show freight traffic is at a seven-year high with revenues reaching over $70 billion and customers are continuously demanding faster cycle times.

Focus on investments in real-time data analytics for smart DSS and IoT based sensor analytics solutions is mandated to provide critical continuous inputs to the fleet and asset planning exercise with constituent factors addressing the mobile workforce, data mobility and data quality for the fleet planning and management.

  • Efficiency

Railways use real-time telematics data and all the data that can be collated from the sensors and actuators to monitor, improve, optimize, the fleet plans with a singular goal of peaking at the efficiency of the operational process excellence. Apart from efficiency, the continuous need to reduce energy costs and minimize human intervention, reduce maintenance costs through real-time diagnostics and predictive analytics, eliminate waste in fleet scheduling through fleet instrumentation. Efficiency and productivity can be increased multifold leveraging intelligent technology, like digital tagging that can be automatically read without the need for a direct line of sight; towards a more real-time inventory intelligence, replacing all other manual efforts required otherwise.

  • Service Quality and Reliability

Railway infrastructure is under consistent heavy stress to do more with limitations at physical expansion. In countries like India and China where the fast-demands-up is a way, the need for better reliability, safety and QoS without much physical elbow space for infrastructure capacity increase is a continuous challenge.

Clubbed with this is to operate with the optimized OpEx with increasing pressure on the price point which needs to keep low as alternative completion threatens. Even passenger services are facing such a price competition from roadways and low cost Airlines. Customer satisfaction is what guarantees the future of railways. Predictive pricing through predictive analytics is increasingly finding space in the planning exercise to ensure all such pressures are catered to. The same holds for fleet procurement and phasing out plans for the obsolete fleet elements, etc.

Also it is an era of two-way communication between the passengers’/business houses and authorities leveraging mobility solutions as a constant feedback on improving the above continuously.

Some areas technology is being leveraged today is addition of intelligence with sensors for cold storage, capacity utilization and mobile-based condition monitoring, improving quality of the systems that trigger warnings, alarms and alerts generated after an event, incident or action by advanced measuring and modeling methods to eliminate the need for maintenance intervention.

  • Innovation and Growth

With Digital levers opening up doors to innovation and many impossibilities like real-time planning, open traffic data, social customer service, should ring in few disruptive trends around. User experience will increase manifold if the Digital fleet planning includes disruptive innovative features for better customer satisfaction and experience.  The solutions would need changes in the approach to planning based on user priorities, data flows, and dynamic response to disruption.

Another factor to fleet planning is the increasing need for an integrated and intelligent network leading to sense demand, measure performance, and monitor physical asset health.  Intelligent systems to respond in real-time to manage capacity and predict /avoid disruption.

Automation and safety will be another area of prime focus where exponential potential of the cognitive techniques will be relied on to save millions of lives, assets, pressing insurance industry as well to innovate.

Collaborative platforms for public and private will be created to meet the mobility challenges while fleet planning exercise would need to take innovative strides to take advantage of creating “low costs to scale” with high levels of participation globally.

The disruptive need to get the Innovation into the DNA of the Fleet Planning is seen as with the advent of autonomous vehicles and improved freight management. Legacy infrastructure is gradually being replaced by train management systems in which trains become interconnected communication hubs, transmitting data among themselves and to network control centers, and receiving instructions from control centers. M2M communication, with a dash from cloud, enabling operators to utilize equipment, tracks and stations more efficiently, while dramatically reducing safety risks. The IoT can further improve the system’s level of automation and its integration with the signaling system.

But all this needs meticulous planning. The yearly railway budget, coupled with a plan laced with the deadly combination of mobile-cloud-analytics as technological levers can bring in drastic improvements in fleet planning.

  • Safety

Though mentioned last, the railway safety is not merely an area of utmost criticality, but also poses challenges to the R&D to continuously create safety access mechanisms deterring crimes in railways infrastructure. As we incline more towards better digital equipped railways, an equal emphasis becomes mandatory for tighter data security and more on physical safety of the railway assets. While planning for the fleet through the year, a Q-o-Q Security is recommended to ensure all aspects of safety are addressed.

Today globally, we have 48,000 locomotives, more than 1.4 million rail cars and enough rail to circle the earth more than 13 times, railroads are relied on heavily by civilizations that be. To keep the vast 140,000 freight rail network and the equipment moving across it SAFE is definitely not an easy task for all the railway boards. The rail safety standards across the globe is getting addressed through the ISO/TS standards.

Managing high density areas challenges traffic regulation. T2T (Train to train communication) communication will allow drivers to understand the speed best adopted to ensure smooth flow of traffic. A real-time dashboard with surveillance video providing access information, where on board and ground staff are all on the same page for the traffic information, all powered by intelligent data gathering-dissemination systems, all alluding to predictive actions in the ecosystem providing safety as well as better functioning.

Digital features like sensors for diagnosing the condition of a motor, infrared sensors for counting the number of passengers, high quality on board internet connection, a suitable information system, onboard information kiosks, create rolling stock in order leveraging technologies, etc. Sometimes cost of such facilities on larger scale can be prohibitive and hence should be factored cautiously into fleet asset planning in a systematic phased manner.

However, the data points across rail locomotive logistics across the globe show that there is a drop of 14% on insurance costs, a drop of 15% on fuel costs, 21% drop in labor costs, 30% drop in operating costs and 21% Upward trend on safety and a similar 19% increase in profitability – all indicators to the fact that the railways across the globe are drastically improving. However, when all this can be factored into the fleet planning across railway authorities  it would be a perfect recipe for an outcome based fleet.

Digital Transformation: Looking Outside for a Change Agent?!

-By Sairam Bollapragada

Every Organization is wanting to go Digital but having its own share of challenges on route to the Digital Transformation. The struggle is not so much with technology which is a given. The challenge is with the DNA of the organization which has been in existence for more than 2 decades and the standard operating procedures (SOPs) have got ingrained into the constituents of the organization. Change is a hard reality and people naturally resist. The resistance is not just about the change, but is more about being compelled to accept the change pushing them off their comfort zones.

When we talk about digital transformation, it is about the journey straddled with the change in human behavior, the cultural change, the change in communication, the change in offerings, the change in skill-sets needed to service the digital client, the change in mindset and leadership, etc. Change happens one step at a time but here we need to bring in a phenomenal change across the organization- many steps at once, across the skills, the mindset, the ways in which we plan and execute, the way we design and create the solutions for the future, etc.

While everyone is aware of the benefits, lets refresh the salient 5 benefits here:

  1. 63% improved customer satisfaction
  2. 49% increased lead generation
  3. 75% lift in engagements
  4. 46% better client conversations
  5. 53% higher traffic

 

Some facts and figures to refresh the challenges to Digital transformation journey: While 35% of the companies are >80% digital, 68% are hoping to reach there in the next 5 years; while 39% of the challenges are in establishing the right operational and governance model, 39% are around evolving the company culture; as common drivers, 50% evolve around customer expectations, while 45% are due to rapidly changing competition in the market; and the list continues…

Let’s look at 5 Digital Strategy points (one should look for while stepping into the digital strategy):

  1. A Digital Strategy positioning Technology as a potential differentiator:

Digital is more about how fast an organization is able to adapt to the changing expectations of the market and prove you have the sustaining technological ability and agility to change at that speed. Hence a good and sound strategic plan to prepare the organization for the upcoming technological change that is not only vital but absolutely critical for survival. 80% of the companies report that their companies are getting processes and tools to expedite Digital roadmap, but actually only 46% aim to overhaul customer services. Digital is a space where Technology can both be a solution and a problem.

  1. The CxOs would need to lead from the front: The leaders must play a very critical role in this Change management with nothing less than absolute involvement to demonstrate their willingness to learn and drive the change themselves. The leaders must spend a lot of time with the digital strategy team to understand the context and lead the future blueprint from the front. Every part of the organization must be so synchronized in the blueprint, that it would become a seamless means of accomplishing the singular organizational Digital objective! Though 88% of companies report undergoing Digital transformation, actually only around 29% have mapped digital customer journey and know where they stand.
  1. Create an Organization structure that will be built for Speed, Agility and innovation: Decision making should be given top priority and right people should be moved to the right positions in order to create a very strong sustainable structure – challenging the traditional and the obvious challenging organization constituents and their conventional standard operating procedures. One should target to remove all the potential silos (read threat) not allowing the politics of the organization to hamper the future prospects and final successful end-goals. As an organization every client wants you to innovate uniquely and exclusively for them. Hence the need to pick the right (enabled)leaders who can take smart quick and compelling decisions, though hard, in a very timely fashion.
  1. Outside in view: For two plus decades now, the IT industry has been working in a community manner which has built very strong intertwining relationships between team members with various flavors of emotions, bonding, sentiments and strong linkages. However, the casualty of such organization is its being detrimental in the transformation. Hence to bring in required changes, professionals with immense unlearning and re-incarnation mindset are the need of the hour. Hiring/positioning creative consultants or even workforce, with innovative mindset is more critical than just the experience. This is more observed in larger entities where the larger and longer the team’s existence, the harder to resistance to change.
  1. Cultural change: The thinking of the new generation which has channeled so many startup entities around is a mix of forceful strategy, fearless thinking, innovation through Technology and creative market offerings. An organization marred with Legacy – non-digital businesses and annualized (operational based) economy, these traits will be hard to get from within. Resistance to adoption of new ideas, accepting the new market expectations, creating disrupting growth strategies, coupled with new disruptive generation thinking will double the challenge for the legacy entities – culture being the biggest challenger. Unfortunately, only 63% of the companies feel that culture is a major challenge while remaining 34% sort of agree.

With the complexities of cultural inertia, organizations are being compelled to get the Change Agents outside the organization. This trend has become inevitable when the leaders realize that there is a dearth of talent of such kind within the organization. In many places majority percentage of strategy looks at hiring innovative talent from outside where you can bring in an outside-in viewpoint with dispassionate recommendations of building a potential digital organization of the future. Many experts believe infusion of external talent can ignite the digital transformation much more easily. However, there should be heavy involvement of HR to ensure the moves are not abrasive in nature and the sensitivities are handled with utmost caution.

In addition to the above, the learning and training teams would also need to play a critical role by launching few initiatives like:

  1. Digital by Mentoring: Bring in mentoring of batches of folks under capable Digital leaders. These mentors should have a true capability with knowledge and ability to transform handful of associates.
  2. T-C-H: Training+Certification+Hands-on: mere training of employees may not be a great help but a good certification (internal or external) to gain confidence (self and others), added with hands-on experience in the digital labs would greatly benefit the individual and organization.

I would pause here for you to take a note and will come back with the metrics on Digital transformation of the Organizational Change Management in the next sequel of this….Till then, Happy Digital Transformation!!