Industry 4.0 Increases the Need for Business Relationship Management

The Industry 4.0 (I4.0) digital revolution is transforming our world and industries. Industry 4.0 creates an even greater need for a strong Business Relationship Management (BRM) capability leading the charge in organizations. More than ever, CIO’s need to lead the way as businesses grow ever more technological. They need to think offensively about producing value and changes in growth and performance. Leaders that perceive IT as a necessary order-taking center make themselves and their organizations obsolete faster than ever. CIO’s should be thrilled to hear that their competition is not heavily investing and winning in their IT organization, and that they don’t have BRM’s at the tip of the spear bringing in new strategic approaches towards value.  It means they are engaging a losing strategy in the digital era, and it could be too late to catch up by the time they wake up.

Industry 4.0, or “Industrie 4.0” as it was originally termed, refers to the Revolution. The 1^st Industrial Revolution used steam power to mechanize production. The 2^nd used electricity to generate mass production. And the 3^rd used technology to automate production. The German government coined Industry 4.0 when they strategically noticed the capability of, and need for, “smart factories” in our new cyber-physical world. Thus, I4.0 builds further upon the automation aspect of industry and raises it to a new level, utilizing cyber-physical systems to monitor physical processes, make decentralized decisions, and communicate with humans.

Industry 4.0 affects the value chain across every industry. A recent Deloitte article explains how small businesses and large corporations alike can utilize I4.0 to enhance their offerings and optimize the efficiency of production. As a BRM and expert on technology, you should familiarize yourself with the terminology related to I4.0. If already familiar, then you should determine how to best transform your organization with I4.0. Focus your BRM mindset on how to extract value and produce a strategic framework around I4.0 and communicate it effectively to your business leaders.

Leadership, engaged high-performance teams, and business processes still provide necessary foundations for successful organizations. But, these only advance so far without enabling technologies and convergence between functions. Today’s available technologies now unlock and sustain previously unimaginable capabilities and levels of performance and profit. The challenge comes in finding someone to properly articulate the value for funding. Who will create that strategic roadmap and take the ownership, risk, and bold leadership steps towards the future? Who will create leadership trust to invest in unknown technologies, vendors and ensure true business value is realized? The strategic BRM role has been perfectly shaped to fit this need.

One drawback to Industry 4.0 lies in its novelty. Many BRMs struggle to gain momentum with a new I4.0 internal initiative and management still hesitates to get on board. These business professionals lack someone who can properly create, articulate, and gain leadership alignment and trust in their strategy. The IT teams viewed Industry 4.0 as a powerful initiative but lacked the emotional IQ and business acumen to properly gain support from business leaders. I4.0 further highlights the need for a bilingual (business and IT talk) interpreter, which falls on the shoulders of BRM.

Industry 4.0 further exacerbates the difficulties between functional groups. The rapid-agile pace at which digitally enabled organizations must move will become faster and more integrated than any governed process can comfortably support. Plus, the typical ROI mindset will not work well in learning how to set the path forward into digital technologies. Each group must effectively understand this, which intensifies the need for someone to communicate with, and properly align, key stakeholders. A cross-functional leader must oversee the strategic direction and quickly change course as needed to ensure actual value realization.

The difficulty with this process becomes harder and more demanding of the BRM glue to keep it together. Once the pilots work and you begin to scale globally, who is going to handle the conflict, internal politics, and collaboration needed in keeping the digital ecosystem going? In a world of constantly developing technologies, we must consider how the Internet of Things (IoT) will affect Industry 4.0. The IoT refers to the ever-growing connectedness of smart devices, which enable exponentially growing data creation, generation, and analysis. As you implement an IoT platform and begin connecting everything, it quickly starts to cross functions, complicate who owns what, and rely on someone to constantly oversee the directional decisions.

Now, more than ever, silo-eliminating BRMs must lead their organizations into the complexities of the Industry 4.0 digital transformation. Less than a year ago, a group of senior business leadership approached me to help begin the digital journey into their manufacturing space. However, they still displayed skepticism towards fully trusting IT based on previous experience. In fact, a later Manufacturing 4.0 (M4.0) workshop had global leaders identify our own Corporate IT as a top threat to their success in producing value for the organization. Without a strategic BRM role and trusting relationship, the necessary conversations to remove such perceptions will never happen.

Both sides need each other, as well as a counselor to navigate conflict. From my BRM position, I approached chosen Vice Presidents in IT, explained the situation, and asked for their support and trust in helping us move forward; they happily obliged. Here lies another key point on the power of BRM – both the business VP and IT VP asked the BRM for input on global strategy. Both sides do want to work together, but often do not know how. As the BRM liaison, I gained their trust through open communication. I explained when and who in IT I will engage to ensure scalability, interoperability, data management alignment, security, etc. Since then, the Manufacturing 4.0 strategic framework, an industry-specific spin on I4.0, was created. This framework effectively converged business units with the technology side, guiding the teams to new horizons through M4.0.

This anecdote speaks volumes about the power of BRMs. We know that all functions in an organization aspire to work together to optimize business value. But language, cultural, and experiential barriers prevent certain functions from working together effectively. Add the fact that Industry 4.0 further aggravates existing issues because of its natural ability to increase the speed of automation. Thus, the BRM plays an important role in harnessing I4.0’s transformational power, linking it between functional groups, and optimizing work flow to help the business grow. Pay attention, and you will see BRM capabilities as a key variable for successful I4.0 digital transformations.