In 1851, the year that the first America’s Cup sailboat race was contested, the top speed for a wind-powered vessel was 10 knots. Over the next 100 years, top sailboat speeds barely budged, but by the mid-1970s, top sailing speed had increased to near 40 knots. And driven by innovations in materials, vessel design and sailor training, current America’s Cup boats routinely “fly” on hydrofoils at triple or quadruple wind speeds, and can surpass 60 knots.
At the recent Connected Plant Conference (www.connectedplantconference.com) in Houston, keynote speakers Rod Walker and Kristen Etheredge, partners at the consulting firm Kearney (Chicago, Ill.; www.kearney.com), described the dramatic and rapid improvement in sailboat performance to illustrate the accelerating pace of change in many fields that affect modern life.
“Most of us are focused on meeting day-to-day objectives, so we don’t always appreciate the speed of change happening around us,” says Walker, “and we don’t take the actions toward transformative change — the things that will make those boats fly.”
Walker and Etheredge discussed organizational change management and shifting company culture in the context of deploying digitalization tools at industrial facilities. Leveraging digital tools, including artificial intelligence, has become an essential element of the business of chemical manufacturing (and most other industry sectors as well), rather than a “nice-to-have” feature. But the difference between success and failure of digital deployments comes down to how well the workers adopt and embrace the digital tools.
Walker says 70% of digitalization projects ultimately fail, and most often, the reason has nothing to do with the capabilities of the technology, but because organizations fail to win the commitment of employees. When trying to make changes to business processes, such as those required in a digital transformation, “leaders often believe workers will respond logically to changes, but the reality is that they don’t,” Etheredge explains. “Human emotions are going to have an outsized influence on whether and how digital tools are adopted and used.”
Organizational culture can be thought of as the behaviors that are rewarded, and those that are tolerated, Etheredge argues, and if those behaviors are not aligned with the business results, then organizational changes, such as digital deployments, will not have good success.
“You have to be transparent in addressing questions of why the change is necessary,” Etheredge says, “and clearly and specifically articulate how the technological change will benefit individual workers — the ‘what’s-in-it-for-me?’ question.”
One thing that has become clear in examining the data and analysis on organizational change management is that when companies carefully consider and address the “human aspects” of change upfront and throughout a change project, they see a significant return on investment. Specifically, Walker said that top culture performers deliver expected results five times as often as those with lower scores.
For successful digital transformation initiatives, you need to generate enthusiasm for the change by communicating the vision clearly, supporting changes in capabilities, deepening commitment on the part of workers, and, once the changes take hold, sustaining performance, the speakers say.
Whether your objective is sailing a faster boat, or manufacturing a new chemical product safely, sustainably and profitably, getting the people part right is a key to success. ■
Scott Jenkins, senior editor