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Eight years ago, a leading CPG manufacturer launched a $50 million digital transformation initiative to solve a host of production problems that were causing operational inefficiencies and dragging down the bottom line.
The initiative showed promise at the outset, but the company didn’t, and maybe couldn’t, have anticipated how long the development and implementation processes would take. Between gaining budgetary approval, developing a plan, hiring a suite of engineers, installing sensors, and creating software to analyze the machine data, years passed without proof of a meaningful ROI. Throughout this trial and error process, the company was losing an estimated $300 million per year to unplanned downtime across their production lines.
It took the CPG manufacturer many years to realize that they were wasting resources building technology versus focusing on where their expertise lies — in developing and producing quality consumer products. Once they decided to look for a partner, they found and onboarded Augury for a technical and business validation at two facilities. Within weeks, they started resolving some of the key machine-related production challenges they had struggled with… but what if they had chosen to partner with Machine Health experts in the first place?
Here are four reasons to partner with Machine Health experts when approaching digital transformation:
Reason 1: Partnering Simplifies Digital Transformation
With any complex innovation process, there’s more to it than meets the eye. Companies that attempt to build their own machine health solutions often find themselves spending more time and money developing and implementing the initiative, often unsuccessfully, than doing what they do best — serving their customers.
Machine health should be the centerpiece of any manufacturer’s digital transformation strategy, and partnering with experts simplifies implementation and increases the likelihood of success.
Trusted partners can provide a team of experts to help weigh the pros and cons of different technology decisions, avoid common pitfalls with implementation, and interpret and apply the vast new swaths of data they gather — without compromising a company’s focus on its customers.
Reason 2: Partnering Saves Money
It’s difficult to budget developing an in-house machine health solution. The cost is unpredictable and can vary greatly, from half a million dollars to tens of millions, depending on the problems the initiative is hoping to solve, and the speed and extent to which they hope to scale.
This is before considering the opportunity cost of developing an in-house solution. For every month or year that it takes to implement an in-house solution, problems with unplanned downtime or lower productivity persist. In contrast, the cost of working with an expert partner is predictable.
Reason 3: Partnering Improves Focus
Another major consumer products company realized early on that machine health was important, but building its own solution wasn’t financially or operationally feasible, let alone strategic. “Why would we become a data science company, when it’s not what we do best?” their executives concluded.
Knowing their strength was in product innovation, they partnered with external machine health experts to assist in delivering this central component of their digital transformation strategy.
By focusing their time and development budgets on strengthening their product lines, and then partnering with machine health experts to ensure those products were efficiently produced, they have remained at the top of their industry.
Reason 4: Partnering Creates Competitive Advantage
A manufacturer that is building its own machine health solution may need to keep their initiative small, perhaps limiting it to a single line, until ROI is proven. This is a costly “chicken and egg” dynamic, where success is required to scale, but scale is necessary to demonstrate program success.
An external partnership can often prove ROI faster, allowing a company to scale quickly and efficiently, gain faster internal buy-in, and stay ahead of the competition as a result.
Hundreds of companies—including the CPG manufacturer mentioned earlier —are now taking advantage of external machine health expertise, and partnering to gain competitive advantage. Your company’s competitors may be among them. Staying competitive means staying focused on what your company does best, and partnering in areas where you don’t have expertise.
If you haven’t explored a machine health partnership yet, there’s no time like the present. Interested in learning more? Drop us a note.
Emery Rosansky is VP, Alliances at Augury and formerly VP, Global Revenues at Augury. She has over 13 years of experience building Sales and go-to-market organizations from scratch and leading teams to exponential revenue growth. Her work spans across multiple industries, with the common thread of bringing digital solutions and transformation to customers in existing markets.