00:18 Therese Snow
Hi and welcome to our domain podcast, global operations on the go. Today we continue our transformation journey note series, a four-step guide to drive your industrial transformation journey. We'll discuss further Note 2: the four-step maturity transformation model for operations, with additional insight on digital transformation strategy and maturity assessment process with Frederique Bourdoulous. Frederique is managing the EMEAR manufacturing consulting team and the DELMIA brand. She joined Dassault Systèmes three years ago, and prior she was production manager and Industrial Program Manager for an industrial company. She is also black belt certified and has 20 years’ experience in Lean Manufacturing. Welcome, Frederique. So, what is the role of the manufacturing consulting team at Dassault Systèmes?
01:10 Frederique Bourdoulous
Thanks for inviting me, Therese. So yes, we are a team of experienced consultants with a strong background in the manufacturing environment. We are knowledgeable in whole industries and in IT ecosystems. And we have also experience on financial analysis. And I have to say that we are all Lean Six Sigma certified. So the role of manufacturing consulting team is to help our customers launch or accelerate their digital transformation. To do this, we have developed an end-to-end transformational engagement model driven by measurable business outcomes with progressive transformation stages, which is increased quality and business value for our clients.
01:59 Therese Snow
All right, thanks for your explanation. So why are companies currently starting or accelerating their transformation?
02:08 Frederique Bourdoulous
It's even more important today, you know, so we live in uncertain times and many companies have to fit to stay alive, and especially with the COVID-19 crisis. So this transformation for manufacturing has become more urgent. Plants need to adapt their production lines to keep people distancing, for example, constantly add that to their production volumes, to the available workforce. Another thing which is not new: clients have always been demanding, but it's true they have pumped up their expectations. They want their customized orders delivered as quick as possible, for sure at the same price. Manufacturer needs to be flexible to consistently adapt their processes to rising demand. And the last point I will mention is the need to digitize the business has fast become non-negotiable. If you are not transforming your business on yourself, you will fail to adapt the new market realities.
03:16 Therese Snow
Alright, great. So you mentioned digitized; did you actually mean digital transformation?
03:22 Frederique Bourdoulous
As I said, transformation is key to remain in the race; to be more flexible, to support pressure coming from the environment and to reduce the operational costs. And yes, the digitalization is another lever to modernize the processes. But when we say digital transformation is not just an assembly of new tools or devices, it's more than just data and connectivity. It's an arm to a new model for manufacturing. New technologies allow manufacturers to develop new business plans and new processes to enter new markets. In other words, these technologies allow manufacturers to produce better on the first step and here the objective is to achieve the manufacturing excellence by providing flexibility and sustainability in this quickly evolving market.
Leveraging the latest technology makes also your current workforce more productive, collect the best practices and capitalize knowledge of your workforce—and finally it makes your company more attractive for recruiting newcomers. I have recently read a survey done by either Shiva or Terra. And the overall responses indicate that many companies will struggle to scale their digital implementation. 35% of respondents agree that a lack of clear roadmap is a top challenge. And 40% of large companies have a long-term digital transformation strategic roadmap in place but only 18% of midsize manufacturers, 18%. So, it's clear that with digital transformation, if you want to maximize the return of investment on experience, more sustained goals, you need a clear long-term strategy.
05:26 Therese Snow
All right, so I'm sure listeners would like to know just a few things, what is the strategy that companies need to apply? How can a company or a manufacturer know what they have to do and really, how can they start their digital transformation?
05:43 Frederique Bourdoulous
First thing to do is to understand where you are, then you can build up a strategy—where you want to go. You know, all businesses are structured through processes. Process Management is at the heart of strategic challenges. So, to start a business transformation, you have to start by identifying your maturity for your manufacturing processes. Like that, you can understand your company's strengths and the areas for improvement to define your plan to transform your company.
06:17 Therese Snow
So, can you describe their processes’ maturity?
06:22 Frederique Bourdoulous
In our methodology, we identified four maturity levels. So, in fact, four stages for transformation. The first one, the institutionalized processes. At this stage, process may exist, but not fully documented and not shared across sites. So, the execution of processes is often manual, and if they are automated, companies are only using an ERP. So, the first need here is to standardize processes so this is the baseline for improvement. Then the second level of maturity is when the processes are standardized and automated. So, this level corresponds to the average of the industry. So here, a core system exists, successful companies are implementing MES system or their standalone system in order to support their processes. Those systems ordinarily (are) not integrated to each other and not integrated to the ERP. And at this stage, business performance already inputs as the system deliver real value over, but here the need is to integrate processes.
So, the third level of the maturity is the mature level with the compressed processes. Compressed processes, because here the focus was put on the business processes and compressing organizational silos. Manufacturing processes are integrated with the operation, for example. Systems are linked to processes and integrated to each other. The connection between upstream and downstream processes provides real time status, predict future states and allow to improve quality. And, at last, the last level, the world class level, where we can say all processes are optimized. And that's this final step. And so all the systems (are) moved to a unified platform across all technical functions, and covering all processes. Silos are compressed and processes are reshaped. Processes become an intelligent decision-making system.
08:47 Therese Snow
Thanks for the details, Frederique. Coming back to your role, how can Dassault Systèmes help their customers?
09:03 Frederique Bourdoulous
I’ve mentioned previously, clients need first to assess the current situation from the latest trends, the pain point on their processes, and define step-by-step what they want to improve and create their transformation roadmap. For that, we are able to drive the maturity assessment for our client. We have developed an approach based on our 15 years’ experience on at least 200 consulting missions. So we meet the client, we visit their manufacturing sites, and we organize one, often on their site, where client describe their processes; quality assurance, quality, logistics, even manufacturing engineering, okay. And so, which systems they use in order to support their processes. Based on this, we classify the maturity of each functional capability using the four different levels that I have described earlier. Taking into account their maturity level, we give them some strategic recommendation to move forward on the next level. We propose an overview of what could be their improvement plan to become more mature, and what they need to focus on.
10:25 Therese Snow
Can you share any examples with us?
10:27 Frederique Bourdoulous
Yes, sure. Recently, I've made the maturity assessment for a company delivering industrial equipment. So they have documented processes supported by standalone systems and some homemade systems which are not covering 100% of the process. But we can tell they are at the formal level, so meaning at the average level of industrial companies. They have standardized processes, and some of them are automated, but they could achieve better performance or range and reduce their operational costs by getting the next maturity level. For that, first, they need to get better visibility and better control on what happened on the shop floor. They need to track their execution in real time to get traceability and impact performance on productivity. Then, they have also to synchronize quality, logistics with production in order to increase productivity, throughput, and here, impact their capacity. Thus, to definitively achieve (the) next level of the transformation and increase their competitiveness, the lessons we have recommended to them is to connect the execution with the upstream processes to get digital continuity.
11:52 Therese Snow
Great. Wow, there's a lot of really good information, Frederique, I appreciate this. So, just to kind of recap some takeaways, maturity assessment is a strong change management tool for companies to get outside in perspective of where they should invest resources to increase in maturity, and where they have to start their digital transformation journey to ultimately improve their business performance. Also, just wanted to recap some of the topics that you've touched on. The first one, the institutionalized processes. The second level of maturity is when the processes are standardized and automated. The third level of maturity is the mature level with compressed processes. And, let me see, so the fourth level, the last level is the world class level, where we can say all processes are optimized. Is this correct?
12:54 Frederique Bourdoulous
12:55 Therese Snow
Okay. Excellent. So then, can you tell us more about the next research note?
13:00 Frederique Bourdoulous
Yes, sure. So, you know, Dassault Systèmes has developed the Transformation Journey Research series to help clients understand and succeed in transformation. So together, as you said, so we have reviewed the four stages in the transformation journey to provide help in assessing the organization status, maturity level, and the next step in that journey. So in the third research note, we go beyond digital technologies and maturity to outline the key consideration in planning the transformation journey. We'll come back on why it's become a priority, what is needed to take into account to calculate the payback, and especially, why it's so important to use a value-based approach to change processes and not only change or implement new systems.
13:50 Therese Snow
Excellent. So I'm going to let our audience know that they can find more information that will be available on our DELMIA YouTube channel, DELMIA blog and social media, where there's a link to download the paper.
14:04 Frederique Bourdoulous
Thanks for taking time to discuss about the strategy on how to start and accelerate the journey of digital transformation.
14:12 Therese Snow
Thank you for being our guest today, Frederique. I'm your host, Therese Snow, and thank you for listening to Global Operations On The Go.