How to set measurable digital transformation objectives for your organization
In a previous article we discussed the eight steps of the overarching framework of a digitalization strategy. Today I’d like to hone in on how to get that very first step right. One of the biggest barriers to success for organizations implementing digital transformation is a missing link between big picture vision and outcome-oriented planning. That missing link is the process of setting measurable objectives that translate high-level strategy into actionable steps.
How to set measurable objectives for your digital transformation strategy
Setting clear and quantifiable objectives does three important things:
- It creates desire and persistence in the organization to undertake the change.
- It implements an initiative that's measurable and can be scaled.
- It maximizes return on investment by targeting business value drivers.
Understand the context of digital technology in mining and metals
When it comes to digital technology in mining and metals, the industry is still in the emergent phase. Many vendor options exist but without any standardized approach, which is what we typically see in mature technologies. Vendors offer their individual visions for a “mine of the future” which may not be aligned with your organization’s objectives.Most are designed to solve individual problems, not support a broader organization-wide strategy.
Knowing that there’s a tendency to adopt new tools before the big-picture thinking has been done, organizations can prepare to take a step back.
Start from your organization’s vision and mission statement
The goal of digital transformation is to integrate technology into all areas of the business. These are the key questions that should form the beginning of your process:
- Should the company’s mission statement be adjusted to incorporate wording and direction that takes into account new value streams available through digital innovation?
- If a digital adoption isn’t furthering your organization’s vision and mission, is it really providing worthwhile value for your business? Are there other areas and other technologies that could better serve your high-level goals?
Setting measurable objectives requires referencing your organization’s overarching vision to ensure individual actions are serving the greater purpose. Make sure that vision is up to date and well-articulated.
Identify key value drivers for your industry
Mining and metals typically have five key drivers of performance: safety, mine processing, labor, utilities, and capital.
It’s important to understand where digital technology can transform the performance in one or more of your industry’s key value driving areas.
Typically, digital solutions offer four avenues that transform different aspects of your organization’s operation: decision making, automation, connectivity, and integrated operations.
In sophisticated digital solutions, several of these digital avenues and industry value-drivers will be interconnected, offering a multi-faceted approach to solving complex problems, achieving growth, and capitalizing on the most lucrative areas for innovation.
Define your digital transformation objectives
Once you’ve identified your organization’s priorities and aligned your business’s key value drivers with those of the potential avenues for digital technology, it’s time to actually define the measurable objectives you will use to guide your digital transformation.
Ask the following questions:
- What are the pain points/opportunities and gaps between where we are and where we want to be?
- What technologies or solutions are out there?
- What does our ideal state or our “digital dream” look like?
- How do we get there?
- Who needs to be empowered?
It’s important that your research and focus session stays on target. Stick to developing three to five measurable objectives. Adding more will dilute your organization’s efforts.
Establishing executive committees ensures both the big-picture future of the business and its stakeholders are considered in forming ambitious and achievable objectives. We've worked with clients to form strategic objectives from both a top-down and a bottom-up perspective. Here are two examples of top-down objective statements that are ambitious and high-value:
- Centralized operations centers for all mine sites
- No humans underground by 2030
Here is an example of a bottom-up objective statement that addresses conditions and initiatives that can have a huge impact on the ground:
- Predictive analytics and auto haulage for all haul trucks
Setting measurable objectives can deliver quantifiable value orders of higher magnitude than expected
Defining your measurable digital transformation objectives is an exercise in setting challenging yet achievable goals. Doing so can signal to executives both the magnitude of what digital transformation can actually deliver, and that a feasible pathway to achieving such improvements exists.
Without clearly defined objectives, it's easy for initiatives to backslide or miss the mark on return on investment. Without bold targets, organizations may only dream of 2%-4% improvement when 20%-40% is possible.