Operations Management and Technology
Digitization is taking over. Here are a couple examples:
- 124 million: That’s how many hits on YouTube’s debate content there were after the final 2016 presidential debate. Yet, 11.3 million watched the debate on Fox News Channel-which Nielson declared the night’s winner.
- 3 out of 4 children learn how to play on a mobile device before they are potty trained or can speak a complete sentence.
This focus on customers having on-demand resources at their fingertips is leaving some to question what is left for operations managers to do?
Turns out…a lot.
Technically speaking, digitization is the adoption of digital, real-time and networked products and services and related information. In real terms, digitization is about choice, efficiency, and responding to customer needs. All of this digitization requires the skills of operations managers to implement and oversee. Digitization is not as simple as posting some videos to an online streaming service and hoping customers will view. Operations managers are needed to develop strategies, oversee and plan implementation, develop and lead teams, schedule and communicate.
Operations managers can learn a lot from Swedish furniture company Ikea who switched their catalog production from analog to digital in 2013.
Ikea’s annual catalog is legendary to its customers. Part idea-book, part magazine, part sales; the catalog takes 10 months to create and used to eat up 2/3 of the company’s marketing budget. First, before pictures could be taken, carpenters built each and every piece of furniture that was to be featured in the catalog. When Ikea decided to start using digital technology instead of old fashioned photography, it could have fired its staff and hired graphic artists. It did not. Instead, Ikea retrained 285 photographers, carpenters and in-house set designers to create a CGI catalog.
Thanks to this change, the company spends less on catalog creation and more on getting this sales tool into the hands of more customers.
Here are ways operations managers can apply Ikea’s successful move to digital to their products and teams:
Consider the goals of digitizing and automating your work. Ikea wanted to save time and money on production costs. Perhaps your goal is cutting costs, eliminating waste or creating a more efficient system. Operations managers are needed for strategic goal planning, to determine how to implement digital efforts and technology and how to best utilize people.
Operations managers should gather data to identify which tasks make sense to digitize and automate. Schedules, payroll, human resources dashboards, project management, data collection, data processing and any predictable physical work are all practical tasks to digitize.
Before going overboard on automating HR-related tasks, consider employees and stakeholders. It is still valuable to maintain real human interaction. Think about the conversations you have with stakeholders such as goal setting with an employee or problem solving an issue. Some tasks can be a hybrid of human and digital interaction. Think about customer service calls. Many start with a numerical menu and then you speak with a person assigned to your issue.
Unpredictable or customized tasks likely work best when there is a human being involved.
Training and new skills
Operations managers still need to manage digitized work and the people implementing the tasks. Consider banking apps for smart phones. Now drivers can skip the drive-thru teller window and simply photograph their checks for deposit on their phones. Customers can transfer funds with a click. With all this automation, do we still need bank tellers and managers? There are still times and situations where it is necessary to interface with a person rather than a machine in banking.
Operations managers need to be forward thinking and constantly collecting data on how their stakeholders interact with technology, and customer demands. The survival of companies demands that their operation’s managers optimize technology in a way that serves both customer, company, supplier and employee.