Digital Transformation: Vehicle or Final Objective?

Digital transformation (DT) has become a common conversational theme in the industrial and academic arena. Plenty of articles have been published describing the urgent need to embrace DT initiatives and the potential benefits of doing so. Yet, many of these DT initiatives do not offer a clear goal of what is to be achieved. In the end, the reader is left with the idea that what is important right now is to be part of this fashionable initiative, rather than the desired outcome pursued through digitalization and the insights and lessons learned from the application of this transformation.

Considering the high demand for various businesses to establish the DT paradigm, many ideas have come into the foray about the limitless potential DT has to offer. Inherently, companies and organizations have different interests, thus making their efforts to embrace digitalization particular to their objectives. For example, in the energy sector, which is characterized by capital-intensive projects and complex physical assets, the objectives of using digitalization may include:

  • Improve and optimize the project execution process;
  • Achieve operational excellence (OE) on existing assets, creating processes to identify opportunities of improvement and rapidly implement them;
  • Promote creativity by adopting the identified above opportunities in a cost-effective and value-added manner, bolstering a culture of a recurrent innovation process.

These objectives may be progressively achieved by:

  • Applying a data-centric approach by avoiding duplication of databases and interfaces to create better ways to manage information;
  • Promoting seamless processes and concurrent multidisciplinary environments;
  • Creating the foundation for a knowledge-based system capable of integrating lessons learned, experience and expertise from the technical and managerial communities;
  • Implementing simpler anomaly detection approaches and later more robust and consolidated predicted failure behavior schemes;
  • Using the above resources and platforms, identify many other opportunities and mechanisms on a recurrent basis to deliver projects and manage assets in a more efficient and effective way.

During the beginning phases of the DT process, consulting companies and members of academia should be pioneers of these changes and embrace the transformation process to help clients and researchers achieve their goals and objectives. As key pillars of modern society, these institutions can also move the needle when it comes to strategizing the early adoption and application of DT.

Consulting companies and academia play an important role in the digital revolution, not only by developing the resources and tools needed, but also by providing the technical support and advice on how to implement DT.

Regardless of the final goals and objectives, DT should be conceived as a journey or a vehicle, not as the objective itself. Whether the final objective is to create a robust and efficient system capable of delivering projects or to create a management system capable of maximizing OE, the strategy and road map to implement DT should consider the particular needs and underlying subprocesses in the project execution or asset management context.

Holistically speaking, digitalization can be conceived as the channel to better meet stakeholders’ needs and requirements.

Digitalization should be seen as more than a platform or instrument. It should be recognized as a catalyst, one that speeds the performance of processes and provides efficient and effective mechanisms required for an organization to accomplish its objectives. Thus, DT has the potential to advance the use of technological resources, such as artificial intelligence, cloud computing, Industrial Internet of Things (IIoT) and big data, unlike before. Furthermore, digitalization must be allowed to flourish within the appropriate environment to materialize its value, requiring changes in:

  • People;
  • Processes;
  • Organizations.

Similar to previous technological revolutions, DT will require a change in culture and organizational ideology for all levels of an entity. This implies personal and organizational changes, as well as changes on the associated processes to accommodate the new personnel and organizational requirements.

A key component in this new era will be the human factor – the development of a new mindset to habilitate and enhance the DT’s potential benefits.

When considering DT as a vehicle to speed up and improve the processes through which corporate objectives can be achieved, the first thing to determine is what the objectives to be achieved are. If the objective is to improve the project execution process, you need to clearly state what you mean by this. It may involve a seamless, multidisciplinary scheme to deliver projects, maximize profit, or many other things.

Similarly, if the objective is to achieve OE, then you need to clearly state what you mean by OE. This may involve achieving health, safety and environment (HSE) and availability targets, maximizing throughputs, reducing total cost of ownership, and the like.

The operational context and the competitive environment in which companies do business nowadays create a permanent pressure to improve asset efficiency and throughput. Digitalization represents the catalyst to achieve these objectives, but before embracing this new set of multidimensional integrated tools and resources, you should be clear on your final objective and the strategy to achieve it.

Many organizations responsible for managing physical assets have started embracing digitalization initiatives through the development of prognostic schemes, which not only identify potential failure before occurring (early detection schemes), but also identify operational and maintenance opportunities, including those associated with equipment performance and those triggered by operation out of design/safety limits.

It’s important to remember that DT is a journey, requiring a planned itinerary, a road map and a destination. Digitalization is a very powerful vehicle that, in conjunction with the appropriate growing environment, can become the “enzyme” to rapidly materialize the tremendous and hidden benefits of existing assets. DT’s potential does not end here; the simultaneous use of digital technologies, such as AI, cloud computing, IIoT, big data and robotics, will trigger new types of innovation and creative thinking as never before, and a limitless number of new opportunities will follow in the near future.

Genebelin Valbuena

Dr. Genebelin Valbuena, CFSE, PMI-RMP, CCPSC, ASQ-CQA, MIAM, is a Project and Asset Management Advisor. He has worked as a Technical Advisor for NOC and several engineering, procurement and construction (EPC) and consulting companies. He has an MS and PhD in Risk and Reliability from the University of Maryland and an MS in Instrumentation and Control Engineering (Automation) from UNEXPO.

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