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Digital Transformation, Beyond the Buzz

July 25, 2023
PTC’s Steve Dertien weighs in on how manufacturing’s push toward digitalization will take shape.

Machine Design Senior Content Director Bob Vavra and Steve Dertien, executive vice president and chief technical officer at PTC, recently sat down to discuss the finer points of manufacturing’s digital revolution—in particular, how getting alignment among personnel can prove more daunting a task than getting alignment on technology.

What follows is an edited transcript of their conversation.

Machine Design: Digital transformation is a big buzzy dynamic term. But what the heck are we talking about here?

Steve Dertien: Well, there’s the industry version of it and then there’s how we help customers. At the core of it is, how can we use digital technology to further advance a company’s capabilities? It might be to help drive automation or to help employees who are doing tasks. We really just want to lighten the load so that they’re able to focus on the more important things.

Most of our customers are not making simple things anymore. They have complex portfolios. And so, how do we help them manage an incredible diversity in their product definition with an ever-increasing change? Maybe in the technology landscape, too. More software in the product that differentiates…than just the hardware alone.

WATCH: Lot Size One & Agile Manufacturing

MD: One of the things we’ve observed is the technology part of this works really well. You’re able to gather data, you’re able to analyze data, you’re able to disperse data to the right person in the right context. The difficulty has been, and this is part of the transformation process, in getting what had been disparate parts of a manufacturing organization—design, operations, maintenance, supply chain—to understand what that data is at a basic level. And then how do they work together to drive those efficiencies that the data is pointing toward?

SD: I think a lot of what we do with customers when they look at it from a strategic perspective, they might say are we looking to just improve the productivity of people or eliminate a process bottleneck or maybe something more executively focused. Do we drive a program around part standardization and reuse so that we can save money on the manufacturing of these things while increasing the product portfolio?

I think we all kind of generally prefer to tailor things the way that we want to buy them. And that’s kind of prolific in the marketplace. That actually is a good strategy for return on capital. But at the same time, it takes everybody to kind of lean in in a particular way to say that this corporate objective is worth the effort to kind of get there.

That’s fueling a lot of the growth that we have. But it’s delivering a lot of value to customers as well. They’re seeing their quality improve. They’re seeing customer satisfaction certainly increase. And ultimately, in the end of the day, brilliant products in the market. You know, as a as a result of those types of strategies.

MD: Before the pandemic, we heard a lot about Lot Size One and that idea of being able to create a manufacturing process that customized each part, each product that came off the line. That’s kind of fallen back just a little bit as we’ve tried to unwind ourselves from the supply chain problems. But we are seeing the manufacturing being more flexible, being more dynamic in the way that it’s using data and the suppliers to come up with better designs. And then from those better designs, a better operational way of producing the products.

SD: You could argue that agile in software is starting to become a little bit more fashionable as a result of supply chain inflexibility or the need to have adaptability. So how can you quickly change from one component, one supplier to the next to deal with the volatility?

So I think COVID, and ultimately the supply chain that we’re currently left with, now is causing a lot of people to say there actually were some positive things that kind of came out of that. One is the ability to be a little bit more flexible in terms of how to react when you can’t exactly get the quantities you’re looking for.

I think it’s interesting in terms of bringing a product to market as well. You can evolve it a little bit more quickly than maybe in a waterfall model. We do see a lot of our customers are saying, “How do we incorporate more agile in everything we do?” Smaller companies might do the essence of agile; large organizations might take a, let’s say, like a scaled agile perspective.

Because clearly, if you’re making cars, you don’t just willy-nilly change it in 10 sec. It’s a little bit more profound than that. But again, I think that’s another form of digitalization that that really is kind of adding a little bit more fuel to the acceleration that companies can participate in. The counter to that: If they’re not, maybe they’re still struggling and doing it through extraordinary, extraordinary measures. And I think the competition that that brings will kind of sort itself out.

MD: In the beginning of these processes, these were seen as sales advantages and profit advantages. But these are really things that the production team, the operations team, they really benefit from this as well. They’re more efficient, they’re more effective, they’re safer all the way down the line. It hasn’t just been a bottom-line process. It’s very much been an operational shift in organizations just by being able to get the data and use it effectively.

SD: I think in the end, if a customer can provide a wider arrangement of options to the market that returns on their investment—their assets in the factory, whether it’s people, material, machines, you name itby all means, they’re going to continue to attempt to do that, because the more market coverage they can get, the better the opportunity it might mean for the company. But they have to do it profitably.

But you’re right, it actually brings itself right down to the operators on the factory line who are working in more and more flexible manners, particularly when we talk about large assets that customers are producing. Rather high-volume products like home audio and that sort of thing might not take advantage directly like that, but honestly, I think even their portfolios are getting wider in terms of the choices that we can choose from them. That’s good for us as consumers.

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