4 Steps to Kick Off a Digital Thread Strategy

Written By: David Immerman
  • 4/13/2020
  • Read Time : 5 min
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Increasingly industrial enterprises are taking the ‘disrupt or be disrupted’ mindset. Nearly 90% of executives cite a medium or high risk of technology-driven disruption to their organization. Yet 60% acknowledge the top path to circumvent this risk is to digitally disrupt the markets they serve.

Many companies including product manufacturers are turning to the digital thread to achieve disruption. However, finding a starting point to stitch together a digital thread strategy can be daunting for some. There can be substantial internal challenges to overcome, including inadequate data management practices (departmental silos, governance etc.) and unwieldy data lakes.

We have created a path for organizations to form a digital thread strategy to overcome these obstacles and quickly recognize value.

1. Define all potential digital thread use cases across the enterprise

For any industrial digital transformation program, it is important to form a list of all possible use cases. The digital thread naturally linking across the value chain opens seemingly endless opportunities to create use cases across functions, departments, and personnel. Looking to leaders across the company from engineering to service, can help form these use cases that solve their most pressing pain points.

Forming this extensive list for digital thread use cases is important to not only measure the universe of opportunities, but also to negate lock-in into unqualified vendors. While a successful digital thread strategy won’t initially implement all the use cases on the list, its important to align the company’s vision alongside the software vendor(s) who can scale to the company’s needs. A provider may seem to have a comprehensive offering for a single use case, but it is just as important that they can scale this use case, integrate it with others and implement new ones in the future.

Software commonly considered alongside the digital thread such as ERP, PLM or IIoT is naturally ‘sticky’. This means the software intertwines with critical business systems and processes making it impractical or costly to remove once implemented. 

Technology in a digital thread strategy must handle the breadth of opportunities illustrated by lengthy lists of digital thread use cases to achieve long-term success. Due to this, its increasingly critical that adopters select vendors with a bundle of digital thread technologies and/or partnership ecosystems.

2. Prioritize the digital thread use cases that will drive the most business value

Use cases that align with business goals, strategic planning, and value to customers drive the greatest impact. It is common that these digital transformation or digital thread use case lists run rampant and into the 100s. While these lists can illustrate the extensive possibilities of a digital thread strategy, it is crucial to prioritize the use case(s) that will drive the most business value. Whether it is a single or a few use cases, this initial project must be the jumping off point to showcase to stakeholders and gain momentum.

Identifying what will be the most valuable digital thread use case will be unique to every industry and company. The Volvo Group prides itself on its strategically differentiating high-quality yet customizable products. To enforce the quality of these high-end products, it implemented a digital thread of its highly configurable engine’s quality assurance process, which drives the automaker even closer to its ‘Zero Part Per Million quality goal’.

3. Conduct an internal digital audit to identify relevant data

Similar to accounting procedures, an internal digital audit is considered a comprehensive inspection and report of digital practices and systems, and the data residing within them. The audit identifies what data is available, useable, interoperable, and impactful to the prioritized digital thread use case(s).

Identifying the prioritized use case(s) prior to the audit greatly reduces time wasted in this process because there is a defined scope; the employees know exactly what they need to find out for the use case. Many who have undergone step 3 as a predecessor to 2, have suffered from ‘death by data’- attempting to source all enterprise data at once resulting in an unwieldy, unstructured, and useable data lake.

Time to impact is critical for any digital transformation initiative and equipping employees with a focused internal digital audit will expedite it.

4. Demonstrate quick digital thread wins and scale to drive enterprise-wide transformation

After linking the identified data to create the digital thread use case, internal advocates must demonstrate short-term program wins. The value or ROI achieved can range from improving overall equipment effectiveness on the factory floor to expediting new product development in engineering departments. Demonstrating these short-term wins is important validation to establish credibility for additional executive-level buy-in.

Once this foundation is established the opportunity for digital thread growth is immense where layering in data from other functions, departments, and personnel can expand use cases. With the increasingly digitized marketplace, the digital thread scope magnifies to include new data sources such as the broader supply chain.

Final Thoughts

Massive cost savings are available for industrial companies following these practical digital thread strategy steps. Flowserve, Vestas, and Groupe Beneteau are a few among many already driving digital thread benefits including internal efficiencies and improving customer value.

Follow these four steps to drive your organization into the digital marketplace and disrupt the markets you serve today.

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About the Author

David Immerman

David Immerman is a business analyst on PTC’s Corporate Marketing team providing thought leadership on technologies, trends, markets, and other topics. Previously David was an industry analyst in 451 Research’s Internet of Things channel primarily covering the smart transportation space and automotive technology markets, including fleet telematics, connected cars, and autonomous vehicles. He also spent time researching IoT-enabling technologies and other industry verticals including industrial. Prior to 451 Research, David conducted market research at IDC.

4 Steps to Kick-Off a Digital Thread Strategy | PTC
There are vast opportunities to drive value from the digital thread but identifying where to start can be intimidating. Read our list of 4 steps to form their digital thread strategy today.