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February 27, 2018

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In the last few years I have seen a tremendous shift in our industry. Companies are now taking some really innovative and inspiring steps to transition our “traditional” industry into the modern world. I have also had several conversations with organizations and people who are looking at how the business of shipbuilding, shipping, offshore and even navies are, or can be distributed in the future. They are aware that the new possibility offered by the tools we have available today can change and enhance our businesses in ways we cannot fathom. We need to keep an open mind to be able to capitalize on the opportunities.

In my last blog post Challenges in Achieving Excellence in Shipbuilding I discussed the challenges that we face in the shipbuilding industry in adopting new technologies. There is no challenge that we will face which we will not be able to overcome. However, for those who ignore these real challenges or do not appreciate the complexity of them, their journey will not be very pleasant and might even have devastating results.

The shipbuilding industry has been ripe to exploit this new world and there is no doubt that it will transform in the coming years. I thought I would discuss some of the ways companies are moving forward and solving the challenges I mentioned in the previous post.

Clear Vision, Strategy, Goals and then Focus

The companies that will prosper in the future will be the ones who can focus. There is an infinite amount of possibilities that you have available to you and deciding which of the great ideas to focus on is very difficult. This is especially hard since you need to choose which great idea to focus on among other great ideas.

For example, many shipbuilders are discussing and investing in the Digital Twin (Ship) concept. I think the Digital Twin is a great high-level strategy in order to attain part of a company’s vision. It has a lot of benefits such as:

  1. It is a big enough goal which will take a while to attain.
  2. Will position the company in a way to be able to easily pivot in the future.
  3. There are many paths and technologies which can be used to achieve it.
  4. It has a clear and simple message which communicates what needs to be accomplished
  5. Keeps you and your team focused on a Digital Twin outcome when making day to day decisions.
  6. Market Buzz will help keep upper management/Shareholders engaged in the transformation.

However, the digital twin is a long-term goal and does not have a specific path that must be followed. It is unrealistic to think that any company in the shipbuilding industry will be able to attain the digital twin in a couple of years. The digital twin is a very complex strategy and breaking it down into smaller specific objectives will be the only way to see any progress. Once you narrow your focus to one or two key business benefits you will need to start your business transformation project with a minimum level of complexity necessary to provide a useful level of capability. You need to be ruthless by keeping the scope to the minimum while still providing business value.

With laser focused objectives, companies have found it alleviates the effects of many of the other challenges mentioned in the previous post and makes the first few steps on your journey much more successful, enjoyable, and profitable with reduced risk.

Prioritize People and Culture over Process or Tools

The most important thing a company has is their people. When you see a company that can innovative effortlessly there are great people behind it and just as important is a great culture. A bad company culture can hamstring a company from making any progress with any strategy. However, a bad culture does not necessarily mean you have bad people; itis very important to distinguish between the two.

We all know the importance of people in the success of company or any project which is why it is in often cited as the top 3 items to consider:

  1. People
  2. Process
  3. Tools

Even though we hear/read this statement, and agree with it, very few follow through with it when implementing technology. The most common reason for this is that dealing with people is hard. Dealing with an integration issues, selecting a new tool, etc. is much easier.

For any successful implementation of your project you will need to focus on your people. This will include:

  1. Have a representative for each stakeholder (manager, leads, IT, end users, etc.) engaged throughout the entire project
    1. This will significantly help the rollout of your project
    2. Will ensure you are solving the highest value problems first
  2. Identify Champions and Influencers in several different levels
    1. In my experience I have found several grey hairs with a wealth of information and who were open to changing to the modern time. Probably the most important characteristic of these people was that they were respected throughout the company and could influence others to be open minded. These men and women are the golden egg for a company going through a business transformation.
  3. Create Open Communication Culture
    1. Need to share the information to whomever wants to see it and allow them to share their thoughts. There are rarely any valid secrets that need to be hidden from internal employees.
  4. Ability to Disagree and commit.
    1. There is no way that will be a unanimous decision on all aspects. The key is to have a “Disagree and Commit” attitude. This works well with an Agile Implementation mentioned below because if a decision was a bad one, you will find out very shortly which reduces the effect of bad decisions.

Evolve how we do the things we do

Going through a business transformation to create an environment where you will be able to leverage and easily adopt new technology will require some changes with how your company works. The changes will be organization wide and not directed only to a specific department. It is important to look at the problem holistically at a high level (not detailed) as the new digital world that we are in will transform the processes that we created in the past. If you focus on the high-level workflow, with only limited detail, it will allow you to build a good strategy and not get bogged down with the details of a single workflow which would require many more stakeholders and therefore have many more opinions. It is important to plan your To-Be process but it needs to be understood that what you think your To-Be process will be at the start of the project will not look like your As-Is process at the end of the project. This is simply because as you progress with your implementation you will learn and uncover opportunities that you did not account for. This is why it is important only to spend enough time on your high-level workflows so that everyone has a good picture of where you are planning to go.

The key thing to look at when looking at it holistically is to look for new opportunities which were not there before. The key aspect of this is not to digitize your current workflow as it may not make sense today. It was designed when the tools, culture, requirements and technology were completely different.

A similar but “smaller” example is when shipbuilding CAD applications started to come to the market itt was common that we had very serial workflows between Hull/Structure and Outfitting. With the introduction of the shipbuilding CAD systems with a centralized repository (database) we were now able to overlay the two disciplines (and many more) to run it more in parallel. As our knowledge and the tools improved we were able to run both disciplines more in parallel which allowed us to complete our work faster even though it  introduced some other challenges. What these CAD systems allowed us to do was to be able to better leverage modular construction and pre-outfitting which significantly changed our business. This addition of new tools required us to change the way our yard was configured to leverage pre-outfitting.

One of fundamentals which will be the overarching focus in modern companies is to make information more available and accessible. From an industry that unfortunately has a silos mentality (it’s my data), it is important to provide a good solution that users can access the information they need easily. If accessing the information is not easy, then the employees will simply make copies of the data they need as they feel that is what they need to do to complete their job (all in good intentions). Once data is copied or they create their own Access database, you will be back on your path to your devastating siloed environment.

Create A Platform of Platform Ecosystem

Almost any significant initiative will require a platform that stores, coordinates, automates, guides, etc. information and people. Most platforms will be used for several of your business initiatives and play a very important role in your enterprise architecture.

It is important to choose platforms which are flexible and adaptable so that the software platform does not constrain you on how you run your business. If you are honest with yourself, neither you nor anyone in your company knows exactly the path or how you will attain your vision. Your business will evolve over time and you want your foundational enterprise architecture to be able to evolve with you.

You will need to expand on top of the platform so making sure that it can be built on is important. Different platforms have different levels of extensibility. This does not mean that you should customize the platform so that it is unrecognizable. You need to avoid the path that takes you to software obsolescence. The platform should be updated as often as any other platform (1-3 years) so any extension should include the cost/time/risk in the future as well. You will have to make compromises since each platform has its pros and cons and to make a platform to do something it was not designed to do will not be ideal for your business. I would not say that you should stay with “best practices” because I do not think they exist for most; however, there are guidelines you should follow and if you want to break them then the total business value/cost should be considered.

With the platform of platform ecosystem which will be present in most business enterprise architectures it will be important to select a platform that has the ability to connect to other platforms. There are various ways this can happen with available APIs, an open Architecture, if the platform leverages commercial out-of-box tools (ex. SQL) or if the platform has a community of partners which have created connectors between the platforms you use. The key thing is that there is a path forward to connect your platforms as future implementation of projects will require interaction and synchronization between multiple platforms.

When investing in a new platform or technology a strategy I recommend is that part of the purchasing agreement is that the vendor or reseller of the platform includes the integration with another platform(s). This does increase the purchase cost but what I have found is that the overall investment for the company is reduced plus the integration is much leaner and efficient.

To be honest I think when most companies have down selected to two or three options, they could select anyone and still be successful. Do not get me wrong, I do think that the difference from each option can have different outcomes; however, related to the other items I have listed here (Clear Vision, Focus, People, Agile Implementation) I believe a “good enough” decision is needed here.

True Agile Implementation

Implementing new technology is different than building a ship and therefore there needs to be a strategy that is designed to handle the uniqueness of implementing new systems and technologies. The most successful is the Agile Methodology.

Do not be fooled by “partial” implementations of Agile as these types of implementations do not yield the same positive results and can be even worse for an implementation as they only give the illusion of Agile. There are several key aspects to agile implementation which need to exist for it to be considered Agile. Here are the top items:

  1. Focus on People

Any proper Agile implementation will focus on people. It will not have bureaucracy when making a decision nor will it have individual political agendas. Agile will help you improve your culture but does not by itself create a culture change. Having people engaged in the project and to leverage everyone’s strengths is at the heart of any agile implementation.

  1. Small iterations with each iteration adding value to the business.

Organizations and people always have the tendency to underestimate effort and the challenges they face as well as overestimate their understanding of what their business needs with limited amount of information. The key is to focus on the high business objectives and create solutions which only solve the highest valuable objectives. In essence, you keep each iteration as simple as possible but no simpler. The duration should be as short as possible; 1-3 months is feasible and practical with a true agile implementation in shipbuilding. Each of the iterations should provide business value to the company and even if no other work is done, the company should be able to leverage what has been completed.

  1. Build, analyze, learn, repeat

With small iterations we will have the time to analyze if the result of the work made progress to the goal that we want to achieve. We can determine if we solved the right problem, did the solution work as we anticipated, have we met user expectations, did we solve the right problem, etc. We also take this time to reflect on what we learnt. Did the technology or software not behave the way we intended it to, did we find a better way of solving this problem, can we apply this solution to other challenges in the future, etc. After this reflection we can plan for the next iteration with more knowledge than what we had before.

  1. Reduce uncertainty: Riskiest Assumption Test (RAT)

Every large implementation has a lot of unknowns and therefore a certain level of risk. The strategy of RAT is to take the biggest and riskiest assumptions and try to answer them as fast as possible.  By answering these uncertainty items early, we can avoid wasted work on a solution which simply will not function as intended or at all.

There are definitely other items for a successful agile implementation but above are the key items.

Another part of the implementation that needs to be considered is how does progress get communicated to the rest of the company. One of the key communication channels is to the leadership team (directors, VP’s, CXO). You need to provide a high-level vision which is easy to consume and understand without knowing about specific tools or technology. This vision will then be broken down to several clear, small, valuable and concise goals. For each iteration (1-3 months) you will break down a goal to one specific objective that the team will accomplish in the relatively short duration. This allows everyone at every level to know what the team will be accomplishing and which goal it is working towards. Remember with the short iterations, the objective can be relatively small and by itself might not look like you are making progress but when looking at how it relates to the bigger picture, it will show everyone that there is progress being made.

A common example of this in practice is Amazon. Amazon’s vision has always been to be the “Everything Store.” But we all know that the first step they took was with books. Focusing on books allowed them to focus on something “small,” learn and then iterate. Today they are getting closer to “Everything” and they still are taking small (relatively) steps forward. It will not be long before you will be buying your vacation to Mars on Amazon.

This is an adjustment of how we plan for shipbuilding but implementing technology and software is different than shipbuilding and therefore needs a completely different way to work effectively.

Closing Remarks

Shipbuilding is going through a transformation unlike what we have seen in decades. The amount of mature and available technology, the additional complexities being requested by our customers, and the general culture of people in shipbuilding of wanting to improve and innovate are making shipbuilding one of the most exciting industries to be in.

This transformation is not going to be easy and we have and will continue to see companies struggle. By understanding the challenges we face, we will be able to overcome them much more smoothly. When implementing any new advances in technology, business and software we will be able to achieve greater things faster, easier, cheaper and most importantly with less risk by these step:

  1. Have a Clear Vision, Strategy and then Focus
  2. Prioritize People and Culture over Process or Tools
  3. Evolve how we do the things we do
  4. Create A Platform of Platform ecosystem
  5. Follow a True Agile Implementation

For someone who loves technology, shipbuilding and business, there is no other place I would rather be.

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