Change is no longer just an occasional challenge for the global manufacturing industry – it has become a constant force. Today, manufacturers are facing a perfect storm of pressures that are reshaping how they operate and innovate. The industry is undergoing a seismic shift, driven by a combination of technological advances, increasing competitive pressure from emerging challengers, and global economic factors that can no longer be ignored. 

Technological breakthroughs like Artificial Intelligence (AI), digital twins, and 3D manufacturing are fundamentally transforming production processes and business models. Meanwhile, new competitors are catching up fast. These upstarts are achieving near-equal levels of quality while demonstrating greater agility and innovation, making it harder for established manufacturers to maintain their edge. At the same time, labor shortages, inflation, and slowing economic growth are further compounding the complexity of operating in today’s global market. 

To address these mounting challenges, manufacturing organizations are turning to the Industrial Internet of Things (IIoT) as a vital component of their strategy. IIoT offers a path forward by unlocking new efficiencies, enabling real-time insights, and creating opportunities for predictive maintenance. It helps companies do more with less. Additionally, the pressure to meet sustainability standards and increase transparency in operations only adds to the urgency to adopt IIoT solutions. 

For many manufacturers, successfully leveraging IIoT is no longer optional – it is crucial to staying competitive. By deploying IIoT solutions, companies can increase operational efficiency, improve customer engagement, and gain critical business intelligence that allows for more informed decision-making. However, despite these potential gains, successfully implementing IIoT is a complex endeavor. 

While some companies opt for ready-made solutions, an increasing number are developing proprietary IIoT platforms tailored to their specific needs. This approach offers numerous advantages: 

• Tailored systems that integrate seamlessly with existing workflows 

• Reduced reliance on third-party vendors, lowering operational costs 

• The ability to refine platforms based on real-time user feedback, maximizing ROI 

However, developing a bespoke IIoT solution also presents significant challenges. From integrating diverse technologies to ensuring data security and managing scalability, the road to success is paved with obstacles. Even more crucially, without a clear strategy and robust planning, companies risk turning these opportunities into pitfalls. Misaligning technology with actual work processes, underestimating the complexity of implementation, or failing to engage employees throughout the process can prevent businesses from realizing the full potential of their IIoT investments. 

This is where integrated change management becomes indispensable. It’s not just about managing the technical side of IIoT deployment; it’s about aligning people, processes, and technology to ensure that the transformation delivers its intended benefits. Change management ensures that every layer of the organization – from leadership to the shop floor – embraces the shift, ultimately enabling businesses to turn challenges into competitive advantages. 

Often looked at as the "soft and fluffy stuff," Change Management is also a technical discipline – reliant on fact-based research, analysis, and strategic thinking aiming at guiding an organization to sustainably introduce changes supported by the workforce. Change Management is essential for many reasons: minimizing disruptions, maximizing employee buy-in, and organizing training and development.

Bringing IIoT into any manufacturing organization requires both a shift in technology and a shift in mindset especially in relation to ‘how things were always done.’ “When organizations focus solely on the technical or operational aspects of a change initiative, they risk encountering substantial resistance and a lack of employee buy-in. This may also result in increased turnover, especially of key people. 

In addition to focusing on raising awareness, acceptance and commitment of the workforce relating to changes, Change Management also works very closely with the project, or in the case of large digital transformations, the Transformation Management team. This integrated approach is essential for successful and sustainable implementation. While the Transformation Management team is planning and managing the different work streams of a project, Change Management generates valuable input for when and where those plans need to be adjusted for the organization to follow the changes and generate the expected benefits. 

To sum it up, a successful Change Management program requires the acceptance of three factors:

• It is Integrated. Change Management oversees the technology and people involved in the transformation throughout the digital journey – from conception to implementation – and is connected to the Transformation Management team. 
• It is Equal. Change Management is often introduced as an afterthought and is limited to communication and training measures. Doing so reduces the effectiveness of Change Management tremendously. Its contributions must be treated equally to those of project management or solution development. 
• It is Iterative. Change Management anticipates and adapts to volatile and uncertain situations. “An iterative approach corresponds to developing flexible strategies and plans, and continuously adapting them while already implementing them. This contrasts with a traditional approach that would involve setting fixed goals, detailed upfront planning and rigorous implementation towards a fixed target state.

“The reality is that the biggest reason [I] IoT-led changes fail is the inability to reach adoption in core teams and via key stakeholders. With IoT in particular, adoption issues stem from the organizational tendency to force people and processes to accommodate a new technology rather than figure out how the tech will add value.”

A simple example is the issues that could arise if an organization forgets that there are at least five different demographic groups in the workforce right now. From the Silent Generation (1928-1945) to the Baby Boomers (1946-1964), to Generation X (1965-1980), to Generation Y/Millennials (1981-1996), to Generation Z (1997-2010) – each of these groups learn and accept technology at a different pace. 

As our colleague Britta Stutzman has written, “Successful Change Management boils down to understanding and relying on the diversity of our workforce; our job is to make sure we know as best as possible what keeps our employees motivated, how they like to learn and adapt to changes and finally what makes them engage in their job.”

But how do you create a transformation program in the right way to avoid the big risk of not having buy-in from the workforce? From our own experience, there are some aspects that contribute to a successful implementation. 

• Question if IoT is the right thing to do and how it helps: This might sound surprising, but what we encounter quite often is a situation where the solution is already decided, but the problem that it is supposed to solve, is still unknown. We know that everyone is eager to start and see the first features deployed, but not having clarity on why an IoT platform must be introduced and what should be achieved by it, will fall on the project’s feet later. 
• Design the IoT platform based on user feedback: Allowing those affected by the change to contribute to the solution significantly reduces implementation efforts. The people who will work with the IoT platform every day know best what features they need to achieve the expected benefits. This should also not be a one-time query at the beginning, but a continuous feedback collection throughout the rollout. Every deployment of new features will generate waves of valuable input influencing the course and outcomes of the project. Highly influential individuals must be identified and engaged early to minimize change resistance and develop influential change promoters. 
• Give clarity on how the IoT platform should be used: While it is always good to leave room for people to come up with their own ideas on how to make use of a solution, IoT platforms are very complex and for them to bring benefits, many different parties have to work together perfectly (e.g., to have correct data, actions can be triggered based on detected patterns). In one of our past projects, the client decided to forgo the focus groups and collaborative workshops on a new solution to let the workers show creativity in adjusting to the new tools. The workers did not have enough time to adjust to the changes causing frustration. Ultimately, the approach did not succeed, and the leaders realized that interviewing employees would provide the input to make the necessary changes.

Despite all the mentioned hurdles and risks associated with introducing an IoT Platform into a manufacturing setup, there is hardly a way around it for organizations that want to be prepared for the future. Fundamental changes in digitalization, automation, and demography need to be addressed proactively by any player in the manufacturing industry who strives to compete in the long run.  

By opting to take the proprietary approach to IIoT, manufacturers can focus on both technology and employee acceptance of digitalization. The journey to developing a proprietary IIoT platform, despite its high investment and associated risks, underscores the necessity for strategic and early implementation of integrated Change Management. Success depends on the people within the manufacturing organization believing in, accepting, and driving the changes necessary for a full organizational transformation and manufacturing optimization.