Industry 4.0 is the latest buzzword. It’s the fourth industrial revolution and represents the future where intelligent machines are self-aware and automation challenges can be solved by the machinery itself.
The manufacturing and engineering industries are on the cusp of this revolution. Only the most agile organisations will thrive, while those with one foot in the past will be left behind. To be successful, leaders and managers must put in place new strategic thinking to exploit business opportunities and respond to threats.
But what are the potential implications of Industry 4.0 for those who must implement change on the ground?
At Festo, we believe that even change itself is changing. The amount of activity, the frequency of projects, and the requirement to adapt quickly is ever increasing. And that’s just on a day-to-day basis. To consider the long-term strategic change required by Industry 4.0 we need a different form of leadership – Leadership 4.0.
Leadership 4.0 looks at the capabilities and qualities that will be required in the factories of tomorrow. The leaders of the future will need to adapt to five environmental changes:
- Competition – react quickly to faster, younger and dynamic organisations emerging to challenge market leaders.
- Hierarchy – free up the decision-making process to speed up the pace of change.
- Technology – harness the talents of individuals to maximise technological advancements.
- Hyper connectivity – quickly take advantage of the opportunities of hyper connectivity.
- Transparency – manage change with open and honest communication.
Preparing for Industry 4.0 requires a proactive and flexible approach to managing change. New competition, an increase in customer complaints, low employee morale and low productivity are all signs that your organisation is falling into reactive change - significantly increasing your risk of failure.
So how can you mitigate your risk of failure? Before you set out on your journey you need to make sure that your organisation, your team and your people are ready for change. Completing a change readiness assessment will help you understand how fit your company is for change.
The next step is to map your change journey, starting with setting your destination. You need to take your employees on the journey with you and give them a compelling vision of what you’re trying to achieve.
Once you have your destination in mind, you can start to work backwards. Map the journey, plan the key waypoints and look out for where you’re most likely to be able to engage your people, or might lose their commitment. Link the overall business objective to individual Balance Score Cards. This will provide you with an understanding of how every individual in your company contributes to the project.
Once you’re in the midst of a change management journey, you will be relying on your managers to Plan, Organise, Lead and Evaluate (P.O.L.E.) the project, the process and their people. Expecting your managers to be proficient in all of these areas is a tall order. Yet successful change will only be delivered if they are. That’s why training in change management is fundamental. And that’s where managers are frequently let down by organisations.
When senior leaders instigate change, it is often cascaded down through an organisation for managers and their teams to implement. This puts enormous pressure on managers, many of who feel ill equipped or unsupported to handle major change projects.
Managers need to be adept at handling difficult people and tricky situations. And yet these skills are often lacking. In recent Festo research, we found that over one third of managers suffered stress and anxiety because of a conflict with someone they were managing.
So what can managers do to deal with the challenges?
- Take a step back and dispassionately analyse the situation.
- Break the cycle. It’s difficult for managers to understand that it is usually their behaviour and attitude that needs to adapt and change first.
- Have courageous conversations. A manager needs to be firmly committed to helping their employee.
- Develop a coaching culture. If employees feel respected, supported and valued they are more prepared to change their own behaviour.
- Speak to the problem. Address the problem, rather than criticising the individual.
- Always follow-up. It’s unlikely that a single conversation will have a miraculous effect on behaviour.
Change is often seen as a negative so it’s no wonder that business leaders, managers and employees view any type of change with a degree of trepidation. There is, however, tremendous potential in any change project. Change is never delivered solely from the top of the business. It needs to engage leaders, managers and the whole team.
To do this you need to consider how you communicate. You need to put in place a communication plan that starts when you’re mapping your journey and continues all the way through and beyond the change project. And for communication to be successful, you need to communicate more than just facts and figures. You need to engage people in why the change is necessary and you need to be there to guide people through the change. We call this communicating to the head, the heart and the hand.
We are facing the fourth industrial revolution. It will alter the very trajectory of manufacturing and engineering. We’ve already seen many customers fail in the last 20 years because they have been unable to adapt to changes in the environment.
Driving change through a business in a way that makes us agile, with people and the organisation willing to adapt, is the new challenge. Managers are critical to steering and delivering change. Get them on board and only then can we set ourselves on the journey to success and be better prepared for the unexpected. And it seems that the unexpected is happening more often.
By Neil Lewin, Consultant for Festo Training and Consulting
Festo has produced a White Paper on Getting ready for Industry 4.0 which can be downloaded here.