Business Brief: A game plan for digital transformation in equipment and rental firms
By Andreas Hellstrom
Meeting customer expectations is harder than ever, and many leaders in the equipment and rental business recognize that technology can help, but they don’t know how to get started. This step-by-step guide will help you integrate technology into every aspect of your operation. It can’t chart out a specific strategy, but it can give you a game plan to take part in the new digital economy.
Embrace technology
Armed with big data, digital powerhouses like Amazon, Netflix, Uber, Google, and Apple can analyze behavior and optimize their business decisions. Equipment and rental firms need to follow suit and invest in their IT infrastructures to remain competitive. Customers now expect and want you to do more to help them be profitable.
“In every industry, there is somebody embracing digital while everyone else falls further behind,” says Greg Verdino, business futurist and digital transformation authority.
If you can’t compete with a tech-savvy competitor, it’s time to address the use of technology in your business. Technology changes, but the process shouldn’t: recognize the need, assess the situation, analyze results and find opportunities, empower your workforce, and create your strategy.
Step 1: Recognize your need for a digital strategy
This process will challenge current business practices, so CEOs need to fully support the effort. Establish a digital transformation team comprised of individuals from different roles and departments to facilitate transformation, monitor process, and inform management on any roadblocks. A team approach helps break down organizational inertia and functional barriers that can derail digital strategies, reports Brian Solis, digital analyst.
Collaboration is needed between visionaries and forward thinkers across multiple business levels. How well your people adapt to change and how you harness technology to get closer to the customer are equally important.
Step 2: Assess the situation
Evaluate the status of your organization with respect to the digital supply chain (DSC). Use the DSC Transformation Maturity Assessment (https://www.dscinstitute.org/resources-and-tools/dsc-transformation-maturity-assessment) to measure your company’s efficacy in catering to the four foundational pillars of the DSC: Demand, People, Technology, and Risk, says Vivek Ghelani, research associate for the Digital Supply Chain Institute.
Distribute the assessment to at least five customers, suppliers, and key employees. Employees should represent key sectors of the business such as financial, sales/marketing, and operations. That will give you and inside and outside view of your digital supply chain. Then, create a customer journey map, diagram, or drawing that illustrates every way your customers engage with your company. It will provide important insights into your customers’ experiences that can be used to develop a strategy for how to improve your customers’ experience.
Step 3: Assess results, identify opportunities
While examining the four pillars, look for areas that offer the highest payback. Ask questions. For example, how much more revenue might you gain if you reacted more quickly to customer demand? How much could customer satisfaction increase if you provided customers with real-time visibility to machine availability?
When networks are connected digitally, business silos are broken down for seamless information flow, facilitating automation, value, and improved workflow.
Gain efficiency in parts and service. Modern, cloud-based systems offer more efficient ways to track and maintain inventory using technology. The ability to locate machines and parts throughout the entire supply chain is necessary to keep up with customer expectations.
Step 4: Use customer and equipment data
Integrating telematic data into a maintenance management allows for more efficient preventive maintenance and repairs. Maintenance moves from preventive to predictive.
Corey Kettner, director of Connected Asset Services for Ziegler Cat, suggests forming a partnership with customers to maintain the health of their equipment. It is a huge differentiator for rental dealers using data to improve customer experiences.
Step 5: Improve speed and lower costs with robotics
Customers are increasingly demanding faster response times and lower costs. As reported in The Economist, robotics may be part of the answer. At online retailer Alibaba’s smart warehouse, robots do 70 percent of the work. Next-generation supply chains take advantage of advanced computing power and the growing availability of data from every connected device.
Step 6: Analyze areas ripe for disruption
Identify disruption points, competitive pricing models, and the creation of new roles that align with the digital landscape. For example, 3D printing is one area of likely disruption. With relatively inexpensive 3D printers, dealers (and their customers) could print their own parts, disrupting traditional manufacturing and distribution channels. Early adopters stand to gain competitive advantage.
Step 7: Identify how digital transformation can empower your workforce
Your digital strategy needs to work hand-in-hand with people. Here are some of the ways technology can help employees:
Technicians: Augmented Reality (AR) and Virtual Reality (VR) are two technologies that promise to make existing technicians more efficient and effective. Augmented Reality could provide technicians with informational overlays to improve their understanding of the task at hand. The use of virtual models and displays on AR goggles free technicians’ hands during repairs, improving consistency and accuracy.
The use of virtual reality can cut training costs and make training more convenient. A headset, controller, and computer are the basic components needed to control the time and location of training.
Other technology, like See-What-I-See (SWIS) glasses and mobile applications facilitate easy remote access to equipment diagnostics, repair histories, catalogs, service manuals, and improved technical experiences.
Sales and Marketing: Technology is helping sales and marketing be more productive, customer-centric, and proactive. Your sales model should give customers control over how they interact with you, whether through digital or traditional channels.
Customer relationship management (CRM) systems can improve productivity by giving sales reps instant access to data needed to better understand their customer’s needs. Mobile apps can streamline equipment rentals and offer real-time responsiveness to customer requests.
Human resources (HR): The growth of multi-location equipment firms has accelerated the need to centrally manage and digitalize HR tasks. It can provide centralized storage of employee data while managing payroll and benefits and perform recruitment tasks.
HR departments are now shifting to data-based decision-making. AI and automation can do much of the legwork for HR departments by analyzing job descriptions and resumes and automatically sending emails to the most qualified candidates.
Step 8: Build the strategy
The final step of the game plan is to formulate a strategy that includes talent as well as technology.
Focus on actionable data. The Digital Supply Chain Institute suggests striving for at least a 10 percent revenue increase and a 20 percent decrease in costs.
“Digital transformation is not a single event,” says Verdino. “Technology is only going to continue to change and that change is only going to accelerate. Transformation is a journey and you need to commit to it for the long haul.”
Ed. Note: This is paid content, sponsored by Infor. Andreas Hellstrom is Senior Industry & Solution & Strategy Director at Infor; learn more at www.infor.com.
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