At the 2022 Regional Business Forum in Manchester, hosted by the Electrical Distributor’s Association (EDA), B2BE’s Chief Operating Officer Europe, Joe Pettit, was invited to give a presentation on the current state of digital transformation across electrical sector businesses, specifically in the aftermath of the pandemic having changed the way businesses and teams work without a foreseeable end.
In his presentation, Joe discussed the state of digital transformation in the industry and its potential to dramatically improve processes around data analytics, accounts receivable, and invoice financing, as well as improving compatibility with potential government mandates. He also talked down hot, but unproven, topics such as AI & RPI.
Joe also discussed how different business elements have the potential to function as serious obstacles to digital transformation, unless carefully addressed, and the ways in which they were most likely to affect transformation agendas. The elements that he highlighted can be categorised broadly as: Systems, Process, Culture, and Supply Chain.
With digital projects more in demand than ever, this demand is stretching resources. A growing infrastructure of internal systems are springing up to support this spike in demand, but, unfortunately, this may not be enough. For example, ERP software does not always have the breadth of solutions necessary to deal with large-quantity data streams. This is problematic for organisations that hope to meet this demand. It is also imperative that organisations comprehensively understand how their current systems work, ensuring that they have all the information that they need before they make any decisions on implementing new and potentially counterintuitive solutions.
A common mistake that businesses make is trying to simply replicate existing processes that an organisation may be familiar with but doing so within new systems in which they are not fully compatible. This leads to the replication of an already cumbersome process but in a digital world. Take the opportunity to redesign processes to use the improvements digital transformation unlocks rather than being restricted to the way it’s always been.
For the change that we need to see across processes and systems, what we also need is a change in the culture of supply chains. This is a mistake that businesses often make: They might adapt to new systems and processes, but do not adapt the fundamental culture of the business. By not fully committing to culture change, organisations are creating a barrier between themselves and implementing the process improvements that they know they need.
The whole point of a supply chain is that it connects clients and suppliers across it, each link on the chain having a knock-on effect on the others. So, before embarking on a journey of digital transformation, businesses must ask themselves whether their trading partners are ready and willing to also take this step. There are understandable reasons, such as market conditions, why your supply chain partners might not be ready for total digital transformation.
How businesses can address digital transformation in the electrical sector
We advise that, for best practice, businesses follow these steps. To properly take advantage of these market trends, businesses need to collaboratively understand the needs of all parties to create the best possible solution. They also need to accept that this will require a cultural and process change within your business and across your supply chain. Therefore, the best digital transformation projects start small and build on each of their successes with straightforward roadmaps. Businesses tend to focus on the solution of technology too soon. Instead, we need to be focusing on outcome, before planning and organising a suitable solution.
So, what are these problems that need solving? As well as the health of the supply chain itself, businesses must consider consumers being able to access in demand goods at prices they can afford, engineers being able to work safely, businesses running efficiently, wholesalers having access to the necessary stock, and manufacturers receiving the necessary tools and materials. Everything that happens at one stage of a supply chain will also affect every other step. Businesses must have a comprehensive understanding of the needs of supply chain partners at every level, allowing them to find all the problems that need solutions.
So, to take this forward, businesses should start by focusing on the problem that needs solving before fixating on complicated solutions as an end in themselves. It is crucial to start by focusing on the desired outcome, before reviewing where and how organisations could use this technology to improve the internal and external problems that you and your team have found. We must not view the implementation of innovative technology as a goal with an intrinsic positive value. It is only by focusing on the problems that need solving, that we can harness the best solutions in the best way.