4 Steps to Kick Off Your Digital Thread Strategy

Across engineering, manufacturing, and service, product companies are investing billions annually in digital transformation. Why? Because it enables them to overcome some of the most pervasive challenges facing companies today.  

Key challenges include: 

• An ever-evolving workforce that’s fundamentally different than it was just a few years ago pre-pandemic 
• A world of products increasingly defined (and differentiated) by software 
• Demands to improve the sustainability of both their business and the products they make 
• Finding ways to optimize the way they deliver their service operations 
• Embedding agility and resiliency in the face of a dynamic supply chain and other market forces 

While many businesses have begun pursuing digital transformation initiatives, a KPMG survey found about half have not realized increased performance or profitability from these investments. Although, clearly some value has been derived as 56% of executives claimed that their digital transformation initiatives exceeded expectations related to improving efficiency, and cost cutting, increasing productivity, and enhancing customer engagement.  

To build on these wins, one of the most impactful digital transformation efforts is enabling a digital thread, which harnesses and organizes product data and makes it available and meaningful for stakeholders along the product lifecycle. But to do this effectively, manufacturers of complex, long-life products must move beyond traditional approaches and implement strategies to unlock the value of their data—and this blog provides a guide for how to develop an effective one. 

What is a digital thread strategy?  

A digital thread strategy is a plan or approach that defines how an organization can interconnect and integrate their siloed digital data related to a product or process throughout its entire lifecycle. It involves implementing digital technologies to optimize internal processes, automate tasks, drive data-centricity and improve overall efficiency, leading to cost savings and streamlined operations, among other benefits. 

Why do companies need a digital thread strategy? 

A digital thread provides a comprehensive, interconnected, data-driven approach to managing complex products and processes, leading to increased productivity, improved product quality, and better decision-making capabilities. It is a crucial tool for companies looking to stay competitive in today's fast-paced and technology-driven business environment. And we’ll be frank, organizations who do not implement a digital thread strategy will be left behind or disrupted.

The primary goal of a digital thread strategy is to ensure that everyone has access to accurate, up-to-date, and contextualized data across the product lifecycle. In essence, it helps keep everyone on the same page by democratizing data and providing a continuous, connected, and easy-to-follow flow of information, leading to improved productivity, higher product quality, and reduced time-to-market.  

By implementing a digital thread, organizations can achieve value from data that was previously inaccessible, underutilized, or hidden, to unlock business value that they never knew existed.  

However, finding the right starting point for a digital thread strategy for your organization can be daunting. There can be substantial internal challenges to overcome, including inadequate data management practices (departmental silos, governance, etc.) and disparate systems. 

We have created a path for organizations to formalize their digital thread strategy, overcome common obstacles, and accelerate time to value. 

1. Identify and prioritize the digital thread use cases that will drive the most business value 

Use cases that align with business goals, strategic planning, and value to customers drive the greatest impact. It is crucial to prioritize the use case(s) that will drive the most business value. Whether it is one or several, these use cases must solve actual business problems—and map back to key measurement values—to demonstrate value to stakeholders. 

Identifying what will be the most valuable digital thread use case(s) will be unique to every industry and company.  

For example, the Volvo Group prides itself on its strategically differentiating high-quality yet customizable products. To manage complexity and ensure the quality of these high-end products, it implemented a digital thread of its highly configurable engine’s quality assurance process, which drives the automaker even closer to its ‘Zero Part Per Million’ quality goal. 

2. Identify relevant data, systems, and gaps 

Like accounting procedures, an internal digital audit is considered a comprehensive inspection and report of digital practices and systems and their data. The audit identifies what data is available, useable, interoperable, and impactful to the prioritized digital thread use cases. 

Having the prioritized use cases prior to the audit saves time because there is a defined scope. Employees are not looking at all the data across the company, which gets overwhelming and unwieldy quickly, just the data they need to do their jobs efficiently, safely and successfully.  

Time to impact is critical for any digital transformation initiative and uncovering the gaps and bottle necks through an internal audit will accelerate the process. 

3. Determine how to measure success for priority use cases 

For each priority use case, a key part of the strategy is determining what success looks like. Teams need to identify the key performance indicators (KPIs) which align to their overall business goals to measure against to understand if their value is being realized. Establish the current state metrics and from there determine the goals for each KPIs. Being able to show incremental progress against KPIs will help keep momentum for the initiative.  

4. Get your digital house in order 

Now that you have identified your priority use case and where the applicable data lives, the next step is to enable that data to be collected, managed, and governed to enable quality and consistency - then shared keeping everyone up to date and on the same page. 

For digital thread to thrive, organizations need to take the time to build a digital foundation with their product data—whether that’s ensuring all designers are working on the same CAD model, linking requirements to the product definition or leveraging critical product lifecycle management capabilities.  

This digital foundation is what creates visibility and alignment within your operations, leveraging connectivity, governance, and modern processes. 

Once this foundation is established the value of that rich data increases exponentially when it’s reused by functions / departments further down the lifecycle. 

Final thoughts 

Digital thread doesn’t happen overnight, so it’s critical to create a plan and stay on top of the essential activities as you execute against your priority use cases. Not only to measure progress against your KPIs, but to understand pain points, challenges, and wins from stakeholders.  

By embracing the digital thread, organizations can leverage their data to unlock new opportunities and drive innovation in their industry. It provides a competitive advantage, helps them realize business and sustainability goals, and, most importantly, helps them combat disruption and ensure business resiliency. 

See how PTC customers, like Vestas and Carlsberg, are leveraging PTC technologies to enable digital thread, driving digital thread benefits, including improving internal efficiencies, accelerating innovation, and enhancing customer experience.