The media is buzzing with tales of total transformation sweeping across industries ranging from retail to entertainment, and the dairy foods industry is no different. Process manufacturers could leverage the new era of digital technologies and product innovation to grow and differentiate their businesses.
However, before companies give up their legacy systems, they must overcome lingering misconceptions that stand in the way of modernization. Understanding these common myths helps managers make well-informed decisions based on facts, not fears.
Myth 1: New technologies mean chaos.
The word “disruptive” can be intimidating. It can also evoke images of negative repercussions, from processes coming to a halt to disgruntled customers or confused and disengaged workers.
But adopting disruptive technologies does not mean unleashing chaos. Most digital technologies do not require abrupt stoppages of old systems and gaps in production during deployment and training. Digital strategies can be deployed in a phased approach, with adequate ramp-up times for training of personnel and well-planned announcements about new offerings or processes to distributors and customers. The organization sets its own timetable, controlling when or how to retire outdated processes, equipment or internal workflows that are no longer relevant.
Myth 2: Only huge companies can afford disruptive technologies.
It is true that many of the digital transformation success stories shared are from big names with the budgets to match. Everyone knows that Amazon, Netflix and Uber have changed their respective industries, but there are also numerous small- to mid-sized companies with modest budgets that have completed successful transformations through the use of technology. In fact, the typical mid-sized dairy company is especially well-suited to adopting digital concepts, exploiting their agility and ability to respond to changing expectations of the market.
Transformation initiatives are typically multiphase, so implementation is not a huge one-time investment, but rather a step-by-step endeavor. Plus, one of the benefits of cloud deployment is the subscription model that lets the company with modest cash flow also take advantage of modernization. So companies of all sizes can seize the opportunities that come with adopting innovative technologies.
Myth 3: Disruptive technologies are all about robotics, IoT and AI.
Robotics, the Internet of Things (IoT) and artificial intelligence (AI) are among the use-cases that seem to garner the most attention. But modernization can also focus on other capabilities such as predictive analytics, company-side visibility and maintenance of assets and tools for collaborating or communicating with colleagues and customers.
So even if a company cannot envision adopting a particular technology such as IoT or AI, it should not rule out the whole gamut of modern functionality. Disruptive strategies are often about visibility, communication and data-sharing. Networked intelligence and connected suppliers are essential today, especially as consumers become more insistent on knowing where their food originates. Digital technologies help forge these lines of visibility about ingredients and food safety, farm to table.
Myth 4: Disruptive technologies are unproven and highly risky.
Digitalization of a company usually incorporates several tactics, dozens of integrated IT solutions, a variety of online tools and a cloud platform for at least some of the solutions. Each tactic should be evaluated one-off for its proven abilities and projected return on investment.
True, some new technologies have yet to collect long histories, but there is sufficient data to foster confidence and projections. Case histories may be limited simply because the technology is changing so quickly. Companies wanting reassurances and added confidence can work with professional services companies experienced in their industry to assist with planning and execution.
Myth 5: We are already too late to the table and cannot catch up.
It is not too late, but timing is critical. The company that is slow to modernize risks obsolescence.
Customers, whether mothers selecting foods for their families or purchasing agents for a large restaurant chain, expect to know details about the product, from where it originated to how it was shipped, stored and processed. Such details are no longer luxuries, but table-stakes.
Keeping pace with the current market also means managing inventory, pricing and order accuracy. Small missteps that may have been tolerated in the past are fatal flaws today. It is important to ramp up modernization and improvements to your IT infrastructure. It is not too late — but the window of opportunity is narrow.
Disruptive technologies might sound intimidating and difficult to deploy. This is far from true. They hold such game-changing advantages that taking the time to research and understand the challenges — as well as the benefits — is worth it.