SAMI highlights the pathway to a successful digital transformation
Saudi Arabian Military Industries (SAMI) is a state-owned defense company launched in May 2017 by Saudi Arabia's Public Investment Fund. As an organization, it has a very ambitious target to jump up from its current position as the 79th-ranked defense company in the world to the top 25 by the end of the decade. Part of the plan to achieve this is a digital transformation of its operations. In the latest PTC Talk, guest speaker Praneeth Chinthala, Senior Configuration Manager, SAMI, spoke about the company's digital transformation journey.
Why is it important to set clear targets for a digital transformation?
From the outset, SAMI had a clear vision of what they wanted to achieve from digital transformation. That vision was to be among the top 25 defense industry companies worldwide by 2030 by developing world-class military products and services and achieving self-sufficiency in Saudi defense industries using cutting-edge technologies and the best national talents. Reaching this vision falls under three core objectives. They wanted to build a sustainable organization, to develop complex products, and to execute complex programs.
Building a sustainable organization requires an enterprise resource management system (ERP). They needed a product lifecycle management tool to develop complex products, and executing complex programs required a program portfolio project management tool (PPM).
SAMI needed to move from where they had none of these installed to fully implementing and integrating these three tools to proclaim that they were digital. This involved integrating people and processes into systems that enabled them to share the correct information with the right people at the right time. Achieving that would facilitate effective decision-making and agility to move forward at the pace needed to meet their 2030 target. Having a vision and a structured plan to meet this was crucial with such an ambitious target.
For an effective digital transformation, clearly defining the vision and end state is vital, but equally important is having the right sponsorship in the organization. For SAMI, the leadership within the organization recognized the importance of the transformation and fully supported the activities, allowing the change to move rapidly.
How is data crucial for digital transformation?
For SAMI, the future state is relatively straightforward. They want the data, which these days is fundamental to any digital transformation, to be secured across the organization. This is crucial in the defense and security market in which they operate. This future state will deliver six main benefits.
- Compliance - traceability and reporting to meet evolving standards
- Collaboration - increased communication and collaboration with other teams to deliver consistency
- Reporting – the ability to analyze and compare all aspects of the business
- Operational efficiency - improved processes and information that are consolidated into a single source
- Scalability – a system that grows with the organization to support increasing needs
- Forecasting – allow accurate prediction to better prepare for the future
When discussing the vision within SAMI, the leaders are asked to envisage how this future state looks in their departments. How they see themselves being compliant, how they seem to see themselves being efficient, how they seem to see themselves being collaborative, and then to work out a strategy that would allow them to move forward.
Where should you start a digital transformation?
A question that all enterprises embarking on a digital transformation face is where to start. For SAMI, it was a step approach that would allow them to grow organically through acquisitions or joint ventures. This approach moved from digitization to digitalization, which delivers a digital transformation. Digitization refers to creating a digital representation of physical objects or attributes, digitalization refers to enabling or improving processes by leveraging digital technologies and data, and digital transformation is the business transformation enabled by digitalization. When incorporating new entities, it is vital to understand their digital maturity and move one step at a time, first making them digital.
In delivering these radical transformations, the people element must always be remembered. For this, Chinthala points to a quote from American writer and futurist Alvin Toffler as inspiration. It says, "the illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn". With SAMI, they already had the traditional learning and development teams in place, but the new way of working required a steep learning curve for everyone in the organization. Many workers were unfamiliar with the latest technology, so they needed to unlearn and relearn to get up to speed. This is where change management comes into the picture, with changes structured to understand and manage the impacts.
What is the role of PLM in a digital transformation?
The start was with PLM, where they needed a tool to look at a product from the requirements stage through design, manufacture, and use right through to disposal. That requirement was one of the reasons that SAMI partnered with PTC and Windchill PLM. Initially, they started with the PTC Creo design tools to manage the requirements through the requirements validation tool, where they designed, developed, and then validated the requirements. These are all contained within Windchill, along with all the change and baseline management. When viewing the architecture, it is crucial to look at the holistic view, plan what is needed, and feed that into the ERP system.
With the architecture in place, the next task is to manage the data from various internal systems and external data sources. SAMI created a data framework and, based on that, wrote procedures to ensure that all the data is collected. In the defense and security space, SAMI is driven by standards, and it is essential to ensure these standards are followed.
Again, when implementing the PLM system, there was a step approach. Initially, only certain aspects were incorporated, with functionality easy for staff to learn and experiment with. In the first year, basic product information, data management, change management, variability management, and document management were incorporated. This approach proved successful, as all the initial aims had been achieved by the end of the year.
One of the challenges that all companies undertaking a digital transformation face is ensuring there is only one version of the truth. Chinthala admits that in his previous company, they had struggled to manage data and secure this single version of truth. SAMI has intentionally ensured that the single source of truth is achieved to ensure consistency, collaboration, and alignment across all the functions.
To learn more about SAMI Land's digital transformation journey, watch the full talk here.