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Digital transformation: The benefits of a value-based approach

April 28, 2023
A Control Amplified podcast with Chris Hamlin, capability development lead at Seeq.
Today we’re talking about digital transformation. Specifically, we’re going to get into  the benefits of a value-based approach to digital transformation. You might look at it as a holistic approach. With us is Chris Hamlin, who is capability development lead at Seeq.


Len Vermillion: Let's begin by discussing some very important distinctions. And while many of the technologies involved may be the same, it's important to distinguish the difference between we'll call digitalization, digitalization, and the digital transformation. Can you explain any of that?

Chris Hamlin: Yeah, absolutely. This is really, really important stuff. Not the thing that matters is, isn't what you call it, but the recognition that there are three different things. Right? Right. And the way I like to think about it if we think about digital music and MP3 files, right? One, technology can be used in three different ways. If you are using those MP3 files to make a CD, kind of no different from vinyl, right? You're just using a digital version of something that was analog before. So using an iPad to take notes the same as using a notebook, right? That's digitization in my, in my vernacular, right? The next thing you might do is say, well, okay, think about an iPod right now because I've got these MP3 files on my iPod, I can have what was the same thing as it's only Walkman only better. Right. You know, it's, it's the same thing. Fundamentally, I'll still buy CDs, I'll download them and hey, I've got my iPod now and it's just a better version of what I used to do. And that's digitalization is what I like to call it.

The final step is again, because of MP3 files is, hey, I don't need to buy CDs anymore. In fact, I don't need to buy albums. In fact, I don't need to buy music. What I need to do is buy a subscription to Spotify or Apple Music. Right. I've totally changed the way I think about owning music and playing music by having a streaming service. Same technology, totally different way of using it and thinking about it. That's digital transformation. Correct. Now why it matters is because it's not so much what are you doing, but your approach to it needs to be different depending on which of those three effects you're trying to have. They're all valid, all based on the same, but you need to think really differently depending on what you, what you are trying to achieve. Mm-Hmm.

Len Vermillion: Yeah. No, that explains it a lot. And it, it is very important cuz I know over the years as I've been covering digitalization and digital transformation, I mean we've used these term intertwined and it's really the concept that's, that's been intertwined. So, specifically as I said in my opening, we're going to talk about digital transformation. The third concept you talked there. So one of the keys, as I mentioned, is to take a holistic approach to that transformation. So let's talk about the importance of this kind of value-based approach and what are the objectives and goals and such a strategy.

Chris Hamlin: Okay. I mean, this kind of really gets to the kind of the number why the earlier distinction matters, right? If you already know the effect you are trying to have, you're trying to use a digital technology to do what you are currently doing, but just do it better. That's not digital transformation at all. That's digitalization. If you are learning and trying to do things in a fundamentally different way, you can't actually necessarily know right now what the end point's going to look like. So you're going to have to learn, you're going to have to do things a step at a time. You're going to have to experiment and work with the experiments that work with experiments that don't. Now, if that's the nature of the change you're trying to bring about, it's pretty hard to put hard numbers on it with hard targets. That's going to be much more around strategic value and how does your organization think about strategic value and, and business drivers.

So when we talk about taking a holistic approach and thinking about value, it's really the what sort of value are you looking for? If it's like dollars and cents on a pound of production and you already know where it's going to come from, you're in a very linear waterfall digitalization mode. But if it's actually, hey, we just, we need to become a learning organization that with an empowered workforce that operate continuous improvement, but we don't know what that improvement's going to be until we get started. That's a digital transformation process and that's much more iterative and much more agile.

Len Vermillion: So of course that would also then I would assume align with things such as capabilities funding the initiatives or company-wise. So for example, so how do you align digital transformation with those strategies are?

Chris Hamlin: Well, and this is, again, this is key to success, right? Right. The key to success is, is so many companies, so many organizations are still getting digital transformation fundamentally wrong because they know they want some digital transformation, but they don't know why or what for. So the way they get their digital transformation is to give somebody the job of go do digital transformation and that person has to make it up for themselves, right? Because it's a thing they want. A piece of what's actually really, really critical is to come at it the other way. Actually use digital to support your business and your business strategy in the way that it's already defined, right? Whatever it is that you're trying to do, you're trying to expand, cut costs, innovate a new route product, change your business model, and move from a product to a service offering, whatever it is, what's your current business strategy? Start there and then look to see how digital technologies can either support and accelerate it or how they're going to get in the way unless you change. So the key thing isn't what can digital do for me, but how can I use digital to achieve the things that we're already trying to achieve in a quicker, better, more effective way?

Len Vermillion: And of course, this all involves change, so everybody has to deal with change at some point and it can be scary. So when it comes to a digital transformation, what are some of the risks that you might come across and how can a company manage those risks?

Chris Hamlin: Okay, so I mean, we already touched on what's probably, I'm going to say the second biggest risk, which is to do digital transformation for its own sake, rather than do it to support a strategy that you already understand and you already know, that's number two. The number one mistake is to think that any of this is to do with technology. And technology is the most important thing because it isn't in a digital transformation project. Digitalization is different in this regard, but for digital transformation, the single most important thing are the people. And it's success and risk is all to do with how you take your organization through the transformation and their capacity to change and their willingness to change. Because the transformation is going to, I always say if you always do what you always did, you always get what you always got. And if you use digital to do what you always did, only harder and faster, you're going to get to where you always got to only quicker and more painfully, right? It's only different if people do something different and they have to be willing to do it. So digital transformation, the single biggest risk, most important risk is taking your people with you. And if you take your people with you, they will make it a success. Whatever it might happen to be taking people with you.

Len Vermillion: That leads right into my next question. And we've talked about this in the past and I've heard you say the transformation, it's a journey, not a destination, which I think a lot of people look at it in that regard is a destination. Can you explain a bit further what you mean by that then?

Chris Hamlin: Yeah, and I can take that back to this whole distinction between transformation and digitalization. If you know what your destination is, you already know that before you start. You're on a digitalization journey, not a digital transformation journey. Mm-Hmm. in the way I think about it right now, it doesn't matter what label you put on it, but you're doing something with a known end goal. You want to do that hard, you want to do it fast and you want to do it consistently. That's very linear. It's very straightforward on a transformation journey. By its very nature, you don't really know where you're going. You just know that there's something out there that you want get towards. We often talk about roadmaps right in, in this space, but roadmap isn't really the right analogy, right? Because with the roadmap, you've got a fixed road network and it doesn't move and it doesn't change.

I like prefer to say it's a bit like trying to navigate through an ice flow, right? There's always icebergs, withing around, we know what we want to get to the other side. So we've got a kind of destination, it's, we want to get through it into the other side. We can know what the first step or couple of steps are that we're going to take, but we're going to have to take those steps and then understand where we've got to and how things have changed around us and what the best route now looks like. So it's much more around the journey and where you finally end up may well be somewhere quite different from where you intended to go, but it will be the right place to have gotten to.

Len Vermillion: Let's illustrate this for everyone, and I know you all at Seeq have worked with a really great case study with Chevron, Phil Chemical people know how to CP Chem. Was this documented in Forbes at one point? I think even, I believe that's right. Yeah. So walk us through this case study and I think this will give people a really good sense of how a successful journey happens.

Chris Hamlin: Well, I mean, Brent Riley who's now the, you know, the leader at CP Chem around seeking how they're using it and how they're going on this transformation journey does a way better job than I'm going to be able to do about telling the story. So go, you go read the Forbes article, I think ARC published it and it, you know, it's, it's a brilliant, brilliant article, right? All go to our website because you'll see interviews with Brent on there. But essentially they started off with a fairly modest aspiration around just making incremental, you know, small productivity improvements around how they did things and how they thought about information and data, but they had a sense that data and information was going to change the way they operate, but perhaps not a really good handle on what that was actually going to mean in detail. So they went on exactly the sort of journey that we talk about.

They just said, okay, we've got a direction we want to go in and we'll get started. Now Brent tells a beautiful story around this realization. They thought that analytics was new and that doing analytics was a new thing that they were bringing to the company. His realization there, or organizational realization is that analytics had been happening forever, all over the place in all sorts of different ways in a totally uncontrolled ways using that super powerful tool called Excel. And that there were individuals all over the place doing all of these different disparate things and there were all operating their little silos and they were tending to hide what they were doing because there were all sorts of issues around we're using the right tool and is it the same as everybody else's? By bringing Seeq into the story, they actually brought all of that out, out into the open and they enabled collaboration.

So this is really kind of the, the story about the people. All of a sudden it became a story not about data and information and analytics. It became a story about people and how people share information and how people collaborate. And that changed the culture to a certain extent within that organization around data stopped being, certain information stopped being something you held onto tightly because it was a source of power, but became something that you collaborated around and that you innovated around and were creative around that then brought about what Brent talks about this significant culture shift and culture change in the organization that went away from being protective of old conventional systems to being one that became actually highly creative and constantly improving because this collaboration just fostered different people coming together and saying, well how can we do this better? How about this idea?

Let's try it out. It provided an op a a space for experimentation and innovation and creativity that's now endemic within their organization. And they now changes the, is their normal because they, I'm going to say maybe even accidentally changed their culture to one that was much more positive. And it sort of rolls all the way back to that idea about the people. And it's a journey, not a destination. They're still on their journey. I don't think they know when their journey will finish it probably never will. And they're enjoying the journey and they're getting better at traveling. Is that story?

Len Vermillion: Well I think all of us are working in any kind of technology field know that the journey never ends. It keeps changing and it's always, we're always catching up to it. So I think this is a fascinating conversation and I definitely would advise people to go read the Forbes article. We'll put the link on underneath this podcast when we post it and you can all go view it there. Chris, I don't have any other questions for you. I don't know if you have anything you want to wrap up here with or anything you want to say to us as we go? Well,

Chris Hamlin: I mean the final thing I'll say here with Seeq, we, you know, this is what we're built for, right? We built Seeq to enable this journey, right? It's a great thing. We're all, we're still learning ourselves, right? So we are always open to a conversation, a discussion with people around their experience because we learn as our customers learn. So, you know, get in touch and, and talk with us. Yeah. We really appreciate it.

Len Vermillion: Sounds great. Chris. Thanks for being here today and we will talk again more about this later, I'm sure.

Chris Hamlin: It was a pleasure and thank you for your time.

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