The Key to Success with Digital Transformation: Get People on Board!

Welcome to the Industry 4.0 Club's fireside chat. The club's purpose is to engage the diverse worldwide talent to accelerate the global evolution to Industry 4.0. We accomplish this by hosting and supporting respectful, thoughtful, and interdisciplinary open conversations and creating quality content on wide-ranging Industry 4.0 topics to expand the reach of our community. My name is Mike Ungar, and I am the CEO of the Industry 4.0 Club. I have over 40 years of experience, most of that in manufacturing with Michelin. I'm joined today by my co-host, Mike Yost. Mike is chairman of the club. Mike, would you mind introducing yourself further?

Absolutely. Thank you, Mike. Welcome, everybody. As Mike said, my name is Mike Yost. I am one of the co-founders of the Industry 4.0 Club, the volunteer chairman, and Mike's co-host on these fireside chats. I've been in industry about 35 years and spent the last 15 years on the industrial nonprofit side. So really excited to have a conversation here today. And we are going to be talking about the key to successful— I'm sorry, the key to success with digital transformation: get people on board. And with us today to discuss this is Vandeleen DeLue, who's the Managing Director at Keough Shaw. Did I say that right?

That's right.

OK, good. I've been practicing. So I've known Valentin for many years and really looking forward to hearing him talk today. By way of background, Valentin is an independent consultant, management trainer, and coach. He specializes in behavior and well-being at work, and supporting the human aspects of digital transformation, which is wildly important. So we're very excited about that. Valentin's experience includes leading technical teams, industrial IoT implementations, and manufacturing technology strategy consulting. More recently, he focuses on coaching managers with behavioral issues, providing emotional and nervous system regulation to people experiencing stress, Burnout, anxiety, or anger. So welcome to the show here today, Valentin.

Thank you. Thank you guys for the invitation. It's really an honor and a pleasure. There's a lot of good examples to share, so I'm really excited about it. There are also some challenges, as we will hear, and so I'll just be very straightforward about it. And I think we better face the truth and, and think about what we can do about it. So really excited to be there. Thank you so much.

Excellent. Yeah, the technology is tough, but I think the people may be tougher. So we'll look forward to tapping into your experience on that side of things.

So yeah, Valentine, you have an engineering background, um, and what moved you from, and you know, that that engineering piece really to now focusing a lot on the human side of digital transformation?

Yeah, that was an interesting journey. So really, I did start on the technical side, very technical. I did product development at Espintech. I did the physical property side, the thermodynamics. I was really deep into the science and the technology. And at some point I was so frustrated because I had to train a model and I didn't really have the computer that allowed me to meet my deadlines. And I got more and more frustrated until I thought, well, maybe I'm not asking it the right way. So I went to my manager and I said, I'd like to get a course on communication. And his response was, a few months later, to make— to give me a managerial position. So that was interesting. And I figured out I really— yeah, it was wonderful. I, I loved it. And, and the team, uh, blew the, the results out of the water. It was really fantastic. Um, so it was a great experience. I didn't really understand why at that point in time, but, but it worked very well. So naturally there was something Something right. Um, and then, you know, 10 years later, I had to lay off people, and I have to lay off people twice and third, 3 times, 4 times, 5 times. And I said, okay guys, I, I've had it. That's, that's— I've been, um, developing these people and it's just too painful. I can't do it and doesn't make sense. You know, there is no structural change, so I'll go. And I worked with a little consulting company and I started teaching management, project management, and that kind of stuff. And sometimes in courses I got reactions, emotional reactions that I didn't understand. And I, after a few years, I took on a training as a somatic psychotherapist to understand what was going on in the minds of the body.

Wow.

of those people because I thought I needed to understand. Now, that was very, very helpful. And, uh, by then I started coaching people with behavioral issues and, and having the understanding of the industry, the IT, the technology, but also the psychology. Now we, we could really figure out what was going on and, and look at, you know, profound beliefs of people and get them back on track. So these were not bad people, they were just suffering from their previous experiences. And it was really worthwhile getting them back on track because they were good people. So that was a key.

Valentin, I'm sorry not to throw you off. I'm just thinking of your personal journey here, of that connection to people, and then your studies and expanding into the coaching and mentoring and stuff. Have you do right now. How widely understood is that? Do you think as an industry in general, people are having similar experiences of trying to connect to people the way you have personally? Or is it still— are you shouting into the void about how important these topics are?

I'm not totally shouting in the void because when I do management trainings, I can see that people Feel it's right when I'm telling, and they are fired up and you know go back to their workplace. And now I know how to deal with people. It's not natural to everyone. So you know some people have it naturally; other ones need to learn it. So there is a potential there. But I think what was specific in my journey was that I was I was traumatized as a. kid, which I didn't know until very recently. Very recently I figured that out. You know, there were all kinds of symptoms and things, and I had all kinds of problems, um, mainly, um, physically.

Yeah.

But I didn't, I didn't really know what was the background of that until I started doing some trainings about trauma healing, and I I would try to apply them to myself and I— shit, this, this works. It works for me. So conclusion, I was traumatized. So I was hypersensitive because of that PTSD. And so I was more interested than other people. And so that, that, you know, that, that's the gift of traumatized people. They're very sensitive. And so that, that made a difference in the journey.

Well, thank you for sharing that.

That's amazing.

So, um, it's how it happened. Yeah, so let me add just one thing more. Um, okay, later on when I started working for ARC Advisory Group, when, when IoT and cloud became, uh, let's say, relevant in the manufacturing space, I saw immediately that people were focusing on the technology and they were forgetting everything else. They were forgetting the people, they were forgetting the legal, They were forgetting the risk management, you know, all that, all the other elements. And so I jumped in that void and tried to develop something that can help companies have a more holistic look at these things and not making the mistakes and falling in the traps. So that's the complete journey.

Yeah, thank you for sharing that. I think it's a It's interesting to see how that all fits together, has fit together for you to get you to the point that you are. So I know you work with manufacturers a great deal, really, relative to digital transformation. So, or you've studied a lot of them as well. So when manufacturers succeed with digital transformation, what have you seen that they do well that allows that to happen?

The use cases that I've been able to study, it's not always easy to get access to information, but the use cases that I've been able to study, what I've seen is that companies usually have a strategic direction. So they, you know, there is some idea we need to introduce some smart manufacturing or some cloud or some, you know, something like that. Sometimes there is a decision about a tool, which can be also a strategic deal. And then there is a process in which people are consulted with, in which people are, you know, sitting around the table and look at the tool and say, how can we apply this in our daily work? How can we observe what we're doing well, what we are proud of, what we are good at?

Uh-huh.

Harness this tool, and then They start designing solutions, configuring the thing, and also co-maintaining the tool over time. With the change management, change requests, and all that stuff. In that journey, there may be some need for looking at business processes, for example. The best examples I have seen is people redesigning their business processes before they implement the tool, rather than using the old process and trying to sort of mold the tool into the business process. So that's— those are the cases that have been working well. Getting people on board, getting people participating, human-centered design, that kind of stuff.

Yeah, it's very interesting because You know, a lot of times I'll see people— so we have a problem to solve and we want to justify the expenditure, right? And so we'll go to the finance people and, you know, we know we have to have less than a 2-year payback, right? And we'll have all this effort to be very precise about the financial payback and the costs and that kind of thing. Which is fair enough. Yeah, but nobody asks the questions about About the people, about, you know, what's your plan for the people? And so I think what you share is quite interesting about, you know, what are some of the key principles for success. I really appreciate that perspective.

There is a wonderful example that I cite in the presentation I'm going to give at IKME, which is about Axens, which is a catalyst manufacturer. And so they talked with the people and they tried to apply it and And they noticed that people got so enthusiastic, they came up with new applications that they even hadn't thought about in the beginning. And so there was this real enthusiasm. Whereas, and that was an important comment you made, Mike, if you have a problem-focused or a gap-focused approach, you will induce some negative feelings or shame, or that's a wrong starting point. That does something to the brain that doesn't help people to learn and to be open and curious. So you start shutting down the system before you have already started. That's a recipe for problems.

So I'm wondering, Valentin, from your perspective, We hear people talking about Industry 5.0 will be the integration of people into all of this. So do you think that people are catching on to what you're saying and getting it, or it's a band-aid on the problem? You know what I'm asking?

I think I— well, you correct me if I don't, but I think maybe some people have understood that the human component should— deserves more, more attention. Now, maybe it is taken on by people who want to make money out of it and don't really understand what is, what is really the crux about it. So I don't know that very well. I haven't been following it in detail. I think the principle is fantastic. I think we do need to integrate people people more, get them on board, get them participating, be sensitive to what they say, be respectful of what they think. And that is the principles that human-centered design uses when implementing these things. And human-centered design, basically the adoption is there before you even start with the application.

Right.

So that's fantastic. It solves the problem before there is one. Right.

I think, I think the, the other— sorry, Mike— the other piece of that that I, I hear people say is you want to fail fast. And what I mean by that is you want to experience, experiment, try things, and be in an environment— I take it to be comfortable— where we're going to try things and they won't always work, but there's a comfort with people being willing to do that because then they're willing to suggest the next idea. Is that what you're seeing as well?

That's great. That's a good thought on the management level. I think, I think that the thought is good. However, how does it work out in the field among people? People, unless they are in a very safe environment where they can actually avoid to fail and avoid to make— where they actually can afford to fail and afford to make mistakes. People don't like to make mistakes. They are scared to make mistakes. So, you know, the environment that allows it must be there, must be more than just a phrase.

That's really, really powerful and speaks to culture, right? And why some organizations have success where others don't, even using the same types of tools and technology.

I think so. I think so. Yeah, indeed.

That's really powerful. Yeah, so how about the mistakes that folks make? I know we're sort of teeing that up, but when folks are taking on a digital transformation and, you know, considering their workforce, what have you seen as the main mistakes that manufacturers are taking?

I see a combination of a cultural issue with, um, the, the culture in manufacturing, and the combination is, is not good. The cultural issue that we have now is a little bit black and white, it's a little, a little bit of simplification, but guys are taught to be tough and independent.

Right.

That's roughly, that's roughly the picture. Tough means disconnected from their feelings, from themselves, and independent means disconnected from others, insensitive. So they've learned that by, by 3, 4, 5 years old. Otherwise, the other kids are brutal with them. So, you know, that's a reinforcing system. So, you know, they, they come out of that independent and insensitive. Now, the more independent and sensitive they are, the more admired they are in the corporate world because they are confident. People like that, and so they move through the ranks. So we have like a high concentration of these people at the higher level, um, and in those higher levels they create a system. So they usually, they have some protectors that who like their, their performance And they create a system around them. So we get— if we finish with a layer of managers, among a lot, a lot are probably, you know, self-centered and insensitive. Okay, and now we come with smart manufacturing, Industry 4.0, and we say to people, guys, this is what we're going to do, and that's how you're going to do it. And if people don't get an option, if people don't get involved, You know, many of them will become defensive. And when they get defensive, they— their brain switches into sort of a negative state. We can double-click on that later on if you want more explanation about it. But basically, the, the logical thinking brain goes offline for a good part, which means you can talk to these people, you can explain them things, and it will not stick. Yeah, so it's not working and people will be anxious and people will be angry. And then combine that with insensitive management, then you get resistance. And so it gets worse and worse.

Yeah, I was thinking though, and, you know, to kind of dig a little bit deeper here, you know, I want to— I've come across managers who want to go fast. And the perception is, in order to get the people on board, I have to go slow.

Is that—

would you agree with that, or is it really— is that a myth, would you say?

Yeah, I think it's an excellent question. So how slow is slow? I think if we take time to people, explain them our strategic direction, and then get feedback and input and work with that input to create together something that works. Yes, maybe that takes a month or 2 more than if we say you do this and that and now tomorrow. Of course you will, you will lose 2 months, but how much time will you lose in the long run?

Yeah.

Because if you look at the numbers, you know, there was a— these studies, they're all consistent with each other. 20 to 30% of those initiatives succeed. That means 70 at least fail, at least to some degree. Okay, so, okay, we went fast, but we don't get the benefits that we want to. Is that, is that what we wanted? So you better take 2 months and get a good result, uh, rather than have the illusion to be quick. And actually mess it up.

Yeah, that's right.

Yeah, it's slightly simplified, but I think that's—

yeah, let me— Yeah, you know, I— the phrase I often use with folks along those lines, I appreciate you saying that, is you almost have to go slow to go fast.

I think so.

Yeah, in other words, you've got to take a little time at the end— at the beginning, but once you get the team on board, once you've mentioned earlier, they're going to come up with other ideas, other ways to, to leverage the technology and the results will far exceed what you plan to most often.

So I'm sure you know the joke about the 2 loggers. They have their axes, you know, they both do sort of a— they need to compete to cut the tree. You don't know that one? It's a classic. And so there is one starts to, you know, to sharpen his edge and the other— the axe— and the other one starts axing on the tree, and the guy who took the time to prepare himself finished earlier. So you need to go slow to go faster. Yes, I agree.

Yeah, well, it's interesting. I was just making some notes because I— one of the things that I think from a technical perspective I hear people talking about, um, in this vein is the need to give autonomy and allow people in the plants and not from a corporate perspective, but give some autonomy, give some— allow people to think and try and fail forward, as Mike was talking about, but with some guide rails, right? So provide—

Exactly.

Technical guidance that says you can't go outside, you stay in this safe zone, you'll be okay. But I haven't heard anybody talk about it. I'm hearing you talk about transformation in that same way, but from a people side of things, which I think is really fascinating.

But I think what you're saying is correct. It's we set boundaries, we set strategic direction. This is what we're going to do. Yeah, but we would like to have your input to do it the best way possible. We do not pretend to know how your job works.

Right.

You can tell us how your job works. So tell us how we should implement it. That's it. But within the boundaries, yes.

Right. And that does take—

First and maintenance afterwards, whatever it is, you know.

Yeah, that does take emotional maturity. And, uh, so yeah, yeah.

And that's why I'm talking about leadership development. So we need to also work on, uh, on personal and social skills at the management levels.

Yeah, leaders have to be careful. I think your point's right. I think the phrase we often use when we talk about empowering our teams, and as you described it maybe, is leaders have to define what it is we're trying to do and why it's important, but then leave room for the folks who have to do the work to define how.

Exactly. They need to own it. Of course, it makes you as a leader nervous because you don't know the final outcome. So it makes you nervous. It's more easy to control stuff very narrowly. So there is an art coming in there, the art of coaching, that is to make people aware of the things that are important, that they are required or asked to take into account. So we need to sort of meet the corporate and the personal and the plant objectives. All together and without forcing them to do that. So it's an art to coach people the right way and still keep the boundaries and the strategic objectives.

That's very good. Could you talk for a second? I know we have, you know, this day and age, at least in the United States, we talk a lot about needing to upskill our workforce for the digital age.

Right.

You know, I remember having— we had to do that for the— we put a bunch of computers on the shop floor. So what are some of the skills required that you're seeing for manufacturers to prepare for what we call the digital transformation?

Yeah, that maybe ties also into the culture. What I've seen in cases that digital transformation fails is that we don't consider sufficiently the culture that people have been growing into over the long years. They've been telling them production, quality, safety, customer service, whatever— those priorities, they have been chasing them for, for 30 years. And then we say, okay guys, now we're going to do IoT. But these people, you know, they feel automation engineers, they feel process engineers, they feel you know, whatever, but they don't feel that they are IT guys. So there we have the IT/OT divide, right? The one that we're always talking about.

Of course.

So if we want those people to adopt new, to learn and to be happy applying new skills, we need to have a conversation with them. And we need to get any concerns that they may have on the table. And in those discussions, we can modify that. But as long as it stays under the waterline subconscious, it will create friction. I don't like this. This is IT. You know, I don't like this. This is— I'm an engineer, you know, I'm not an IT guy. So it's very important to have those performance management discussions in depth with people before we start doing these trainings, which of course we need to learn about IoT and we learn to learn about cloud and we need to learn about system orchestration and, you know, all these modern things that will be part of the story if we want to do predictive maintenance or whatever it is. But it's not only technical stuff, of course, it's also methodologies. Maybe we need to learn more about reliability, maybe we need to learn more about quality, whatever it may be. But the combination between the IoT technology and the methodology, that's where the power is, of course. And then we see that in those IoT projects, there is a lot of interactions with service providers, technology providers, integrators, and people will have to work and work out conflicts and negotiate. And, you know, so they need also their personal and social skills upgraded. That's what we see since, since, since 10 years. There is more interaction between the different trades— electronics, electrical, you know, whatever is mechanical maintenance process, all these guys have to talk together, and that requires more skills. So, a skill, yes, but it's a complex thing to do.

I'm wondering, Valentin, I mean, Mike's in the southeast of the US, I'm in the Midwest, you're in Belgium. You work in Europe and the US. Are there differences between, you know, just different, I guess, US-based or European-based companies that you see that you could point to when it comes to engaging the way you're talking about?

I think that the European-based companies are a little bit more cautious. That's probably also because they are forced to because of the legislation, which protects their workers to probably a higher degree, but they're a little bit more cautious. And then the implementation will depend a little bit on the region. So, you know, even if they have their philosophy, it may work out a little bit differently in one region or another. There is an impressive example of a U.S. chemical major They tried to implement smart manufacturing, and in the south of the US it worked fantastic, and in Europe it didn't work at all.

Oh.

Now, what exactly the reasons were, I don't know. I don't have the detail. I know that there was also reorganization, and people were also like pressed into gear, so, you know, there was also a matter of availability. But yeah, it can work out differently. I think US companies have the advantage of going quicker, so they have more benefits. If they do it well, they may have more benefits quicker. So that's a plus.

Excellent.

I really appreciate that. So for our audience, we've been speaking for the last 30 minutes with Valentin De Leo. And focusing on really the need to get people on board to have successful digital transformation. So Valentin, as we begin to wrap up our discussion today, do you have some final thoughts for our audience just about some key takeaways you'd like to share?

I'll try to keep it short, but there is— I think there is a lot of things that can help. I'll reiterate, leadership development is important. I think there is double-digit benefits to grasp if you do it well. Secondly, there are fantastic methods to help people with change. The intentional change process developed in the US by Boyatzis at Case Western is a fantastic method that keeps the the brain in a positive state. It's not very complicated to do. You just need to know how. So that helps people when they need to be coached and it helps organizations when they need to be transformed. Really great stuff. We talked about skills, competencies that will make people more Self-efficient, more confident. That definitely helps. I think there is some work to do on what Total called operational fundamentals. They sort of they said you needed a constitution, sort of a constitution that has permanent fixed roles and rules that you always. respect, and that not any plant manager can change. For example, you go on a maintenance job changing a pump, you send 2 people, one doing the work, the other one watching. The other one is there just for safety. Just one example. I think we should introduce more human-centered design. Is not rocket science. Go to Stanford online, do a course, takes you three days, easy to do, and you're you're done with with any resistance. Use identity groups to influence. So clubs like this or AICHE or ICME or you know whatever organizations. to, you know, to discuss ideas, to get feedback, to get the best approach possible. And then I would advocate for general interventions for mental health. One thing which is really important to me is clarification of roles and responsibilities. There is a lot of vagueness About these things that create anxiety. I'll give you one example. I had in my job descriptions, you're reporting to Mr. A and you're working with Lady B on this and that. It was very, very common, right? But what does that mean? Now, who's going to do my performance evaluation? On which criteria? Who takes precedence? What, what is the priority if one says this and the other one says that? You have no clue, right? So very simple, try to define who is responsible for what. That will take a lot of anxiety out of the equation and make people much more confident and quiet. It creates a great baseline to do change and digital transformation.

Very good.

Thanks for advocating for that. Also, thank you for being the first person to ever mention somatic psychotherapy on a fireside chat. Appreciate that.

Very original. Mike, you have anything you'd like to add before we wrap up?

No, I think just some phenomenal points. I wrote down a whole bunch of things and probably come back to the point that was reiterated a few times about the receptiveness of coaching, the value of that, and really the need for a safe environment for people to accept coaching.

I think that's really powerful for everybody to know. I think that's really key. Yeah, sure. If there are any questions coming up later, you know, whatever, if people thinking about it, they can always come back and give me a shout, and I'll be happy to answer any Wonderful.

Fantastic. Well, on behalf of the club, I'd like to thank you, Valentin, for joining us and sharing your insights into the impact people have on digital transformation. Really appreciate your time.

Thank you.

The Industry 4.0 Club would like to encourage you to take action to advance the deployment of Industry 4.0. Read an article, attend a workshop, initiate a smart manufacturing roadmap, or Ask your company to take some action and do the same. We would like to know what actions you take. It's important that we all do something when we learn something. Please drop us a note on our LinkedIn page or at our website at www.industry40club.com. We also have conversations like this weekly. If you'd like to join us on one of these conversations, please let us know. We'd be glad to figure that out and have you on. So with that, Mike, Valentin, thanks again. Really appreciate your time today.

Yes, thank you.

Thank you.

All right, everybody have a great rest of the day and a great rest of the week. Thanks.