The Agile Factory E-Book

Claudio Saurin

• Herausgeber: Ayros Editore
• Kategorie: Fachliteratur
• Sprache: Englisch

Veröffentlichungsjahr: 2022

Beschreibung

Management books and articles on the manufacturing industry have long focused on process efficiency at the expense of effectiveness. Waterfall and Lean approaches are now consolidated, but they offer a partial solution to the needs of product development in today’s vuca world. Once appropriately adapted to the development of hardware products, Agile finally
makes it possible to give an organic response to the complexity of the variables involved – from customer needs to constructability and environmental impact – by putting people at the centre.
The results of the iterative and incremental approach described in these pages are extraordinary in terms of speed of development, quality of the product and construction of stimulating and collaborative work environments. Creativity and the ability to generate new products are incredibly enhanced as a result. The physicality of products enabled by software is the challenge we need to face in order to become active participants in the fifth industrial revolution.
“The Agile Factory represents an approach to Agile hardware development integrating Lean, Waterfall and other practices. It removes the barriers between the office and the shop floor to turn them into an elastic, creative and human craft system capable of quickly transforming ideas into valuable and successful products.”

Leseprobe

AYROS EDITORE MILANO

First Original Italian Edition – Ayros EditoreLa Fabbrica Agile. Lo sviluppo di prodotto nella quarta rivoluzione industrialeCopyright © 2022 by Ayros S.r.l.Registered office: Via S. Raffaele, 1 – 20121 MilanoOperational headquarters: Via Malaga, 4 – 20143 [email protected]. ([phone]

Ayros is distributed in Italian and international book marketby Messaggerie Libri S.p.A.Via G. Verdi 8 - 20057 Assago (MI)

ISBN 9791280359544

Translator: Elisabetta ZancanTranslation proofreader: Mike ManchesterDevelopment and copy editor: Caterina CiccottiBook producer and text designer: Fabrizio PoddaInterior image graphic designer: Chiara DanesinCover art designer: Carlo MuttoniCover graphic designer: Clara BrioschiePub developing: goWare

Index of contents

Cover

Title page

Colophon

Description

Forewordby Joe Justice

Introduction

Content guide

01. The Current Context

Taylor’s Bathtub

Creativity in Industry 4.0

Mass Customization

The VUCA World and Innovation

V for Volatile

U for Uncertain

C for Complex

A for Ambiguous

Surviving with a Bimodal Approach

The Cynefin Framework

The Cynefin Framework Applied to New Product Development

The Importance of Speed

02. Developing Products in Today’s Complex Environment

Complexity and Product Development

Coping with Complexity

A Reminder of the 7 Approaches to Dealing with Complexity

1. Self-organization

2. Creative disorganization

3. Sharing

4. Strategic flexibility

5. Network organization

6. Virtuous circles

7. Learning organization

From Waterfall to Agile (Nonaka and Takeuchi)

The Cost of Delay

The Agile Mindset

03. Innovation and Invention

The Goal Is to Innovate, Inventing Is the Means

Surface Innovation and Deep Innovation

The Garden of Innovation

The Principles of the mit Media Lab

The Scale of Innovation in a Company

Agility and Innovation

04. Four Project Management Methodologies

Developing a Product Requires Project Management

Classic Waterfall Development

Lean Development

Project Management 2.0

The Agile Approach

05. From Idea to Product in an Effective Way

Effectiveness in Product Development

The Ideal Process from Idea to Product

Filtering Gates and the Principle of Abandonment

The Initial Selection of Ideas

The Vision Canvas

06. Product Exploration

The Marketing Mix and New Product Development

The Exploration Mini-Project

The Evolution of Lean Canvases over Time

The Product Canvas

Positioning and Competitor Analysis

Minimum Product Requirements and Possible Pre-Proof of Concept

The Return-on-Investment Analysis Matrix

07. The Project Portfolio

The Importance of Defining Development Priorities

Assessing Priorities in Terms of Impact/Difficulty

Prioritizing Based on Expected Commercial Value

Evaluation in Terms of Cost of Delay

Project Moods as a Qualitative Indication

08. The Concept of Value

Quality and Value

The Kano Customer Satisfaction and Dissatisfaction Model

The Risks of Developing New Products for New Markets

Minimum Viable Product and the Lean Startup Philosophy

09. Agile and Elastic Product Development

What Should Be Developed

Peculiarities in the Development of Physical Products

Elastic Product Development

The Agile and Elastic Product Development Process

The Feasibility Analysis Macro-Phase

Staffing

Identifying Know-How Gaps

Impact Mapping

Project Breakdown Starting from the Canvases

Macro-Level Risk Analysis

Feature Impact Matrix

Radar Diagram Comparing with Competitors

Work Planning

Integrated and Concurrent Engineering and Design forx

Updating the Return-on-Investment Matrix and Calculating Cost of Delay

The First Gate

The Operational Development Macro-Phase

The Second Gate

Process Indicators, from kpis to okrs

10. Backlog and User Experience in Physical Products

The Structure of the Backlog

So Many Stories: User, Job, Spike…

Hardware Stories

User Story Mapping

The Many Ways of Using a Hardware Product

Slicing the Backlog

Time Perspectives

Prioritizing Functional Requirements with the MoSCoW Rule

Estimates

Completing the Backlog

11. Risk Management

Uncertainty and Risk

The Need to Take Risks

Risk Management Modes

Macro-Analysis Mode: The Risk Identification Phase

Macro-Analysis Mode: The Residual Risk Assessment Phase

Micro-Analysis Mode: Agile Risk Management in the Backlog

12. The Agile Factory for the Development of Physical Products

Introducing the Agile Factory

Enabling Factors for the Agile Factory

Modular Product Architecture

Virtual and Physical Sprint Reviews

Sprint Reviews vs Design Reviews

Daily Scrums in the Office and on the Shop Floor

Sprint Planning and Backlog Refinement

Elements of Cognitive Manufacturing

13. A Little Practice with Three Product Development Cases

Putting Things into Practice

The Clear or Simple Case

The Complicated Case

The Complex Case

Placement within the Cynefin Model

Distribution of Cases within Product Development

14. Agile People

Management and Agile

Paving the Way for Agility and an Agile Transition

How Teams Usually Work

The Training Process of Developing Skills and Knowledge

The Agile Team with Scrum

What Motivates People and Agile Teams

The Role of the Product Owner

The Role of the Scrum Master

Speed and Agile Organizations

Self-Organization Is Enabled by Processes and Tools

Retrospectives and Agile Kaizen

People and the Agile Way of Working

Output, Outcome and Benefits

The Corporate Social Context and Change Management

15. Four Business Cases

Conclusions

Acknowledgements

Bibliography and Sitography

Bibliography

Sitography

Description

Management books and articles on the manufacturing industry have long focused on process efficiency at the expense of effectiveness. Waterfall and Lean approaches are now consolidated, but they offer a partial solution to the needs of product development in today’s vuca world. Once appropriately adapted to the development of hardware products, Agile finally makes it possible to give an organic response to the complexity of the variables involved – from customer needs to constructability and environmental impact – by putting people at the centre.

The results of the iterative and incremental approach described in these pages are extraordinary in terms of speed of development, quality of the product and construction of stimulating and collaborative work environments. Creativity and the ability to generate new products are incredibly enhanced as a result. The physicality of products enabled by software is the challenge we need to face in order to become active participants in the fifth industrial revolution.

“The Agile Factory represents an approach to Agile hardware development integrating Lean, Waterfall and other practices. It removes the barriers between the office and the shop floor to turn them into an elastic, creative and human craft system capable of quickly transforming ideas into valuable and successful products.”

. . .

Claudio Saurin After working as a technical and production director for several manufacturers, Claudio Saurin is now a consultant, trainer and conference speaker. He has gained significant experience in Digital Transformation, machines for Industry 4.0 and Additive Manufacturing.

He is one of the pioneers in the application of the agile approach in the Italian industrial context.

To Martina and Cecilia

Foreword

Tesla introduces 60 or more new parts into production and sale every day, 365 days per year. This includes the manufacturing processes, certifications, the embedded software, the support and maintenance procedures, the logistics, the supply chain management, and more. Tesla deletes 61 or more parts every day, the total part count continues to be simplified and complexity reduced.

As of this writing, all other automotive manufacturers instead use a phase gate multi-year budgeting, scheduling, and review process to introduce change on a 2 to 10 year cadence.

Tesla is growing in production numbers, profitability, customer loyalty, and measured quality faster than any automotive company in history, and already more valuable on the public markets than the next 10 automotive companies combined.

The secret is Agile. Finally Claudio Saurin has published this landmark book to explain what to do, and how to do it. Claudio explains why Phase Gate multi-year cycles are good, but also why Agile processes are so much better, faster, cheaper, and higher quality. Claudio explains how to move design and production and vendor management and logistics towards the agile world, step by step, or all at once. Claudio introduces xM, or eXtreme Manufacturing, for Agile production operations from a small site to a global multi-factory mega company like Tesla.

I am Joe Justice, I operated Agile at Tesla as an employee at the global headquarters, and I am very pleased to introduce you to this book on Agile Hardware.

Joe JusticeAugust 17, 2022

Introduction

Man thinks he wants freedom. He’s actually very afraid of it. Why? Because freedom forces him to make decisions, and decisions involve risks.Erich Fromm

This book has been written primarily for entrepreneurs, technical managers, r&d managers, project managers and all those who are directly involved in a product development process and want to shake it up with the agile approach.

Dear reader, this book is for you

• If you think that improving your business doesn’t depend solely on increasing the efficiency of your processes.

• If you think it’s more important to develop the “right” product, even if it is imperfect, than to develop an unpromising product to perfection.

• If you think that the cost of the delay involved in introducing a new product to the market is too great for your company.

• If you really think that people come before processes.

• If you think that not everything can be automated.

• If you believe that in today’s world it’s still essential to be very pragmatic.

• If you really want to change and you know that to do so, you have to start with yourself.

Custom manufacturers can benefit greatly from the agile approach, which is also essential for learning how to move in the highly digitalized context of the fourth industrial revolution.

This is a very concrete book, aimed at providing operational tools that a person with sufficient organizational and agile skills can use immediately.

In recent years, while working as a manager and as a consultant, I have realized that custom manufacturers are mainly characterized by their ability to develop customized solutions for their customers. This approach is often activated in response to orders or requests from the customers themselves, while in other cases it’s related to actual research and development projects for new products.

Along with these companies, there are also those that develop mass-produced products and employ a process that is still too rigid for today’s world, which is characterized by Volatility, Uncertainty, Complexity and Ambiguity (vuca) as never before.

Actually, the world has always been complex. What has changed is our perception of this complexity, which has been internalized only in recent times, when the mechanistic view has shown clear evidence of its limitations.

A vuca world requires flexibility and the ability to adapt to an increasingly complex and unpredictable reality. It’s necessary, as never before, to manage risks by taking small steps in possibly unexplored terrain, and to move with great dynamism to seize the volatility of situations and the disruptive challenges that lie ahead.

The traditional approaches – Waterfall and Lean – have not been able to provide an adequate response (or at least not a full and satisfactory one), as they cannot guarantee the necessary change or the speed required.

For many years, companies – supported by management and engineering schools – have focused on the search for process efficiency, which is also known as Exploitation. At the same time, the term “Innovation”, applied to anything from products to processes, has become one of the most frequently used management words. The companies that are truly innovative in the development of new products know how to be explorers and engage in Exploration.

These are actually two synergistic processes, and being able to implement them at the same time is an art.

For many years, production has been nourished by methodologies and tools that have greatly improved its performance thanks to Exploitation.

The time has come for new product development to go beyond the powerful digital tools introduced to support design – such as three-dimensional design systems, calculation and simulation systems, and digital twins in general – so as to radically rethink the entire product development process, taking inspiration from what has been happening for a few decades in the world of software with the Agile approach.

It’s an approach that really puts people at the centre, so they are able to express their talents in the best possible way by working in teams with other people with different skills, in order to generate products of great value for customers and the company – and all in a very short time.

This has been the case in software development organizations for a few decades now – which is precisely what has enabled them to assume the prominent position they now occupy in our society.

The people involved in the creation of today’s smartest products often belong to different generations. That’s because, unlike in the past, nowadays no single individual is able to meet the challenge of developing such products, which integrate different technical disciplines – both hardware and software – and therefore require unprecedented cooperation.

I was lucky enough to work as a product developer for many years, and in my continuous search for possible alternative approaches I came across the agile approach in 2008.

I was immediately struck by such a genuine paradigm shift in project management and teamwork.

Since I was also involved in software development, I had the opportunity to experience its effectiveness, which gave me the idea of trying to apply it to the development of hardware products, or rather physical products.

The results proved to be extraordinary, both in terms of speed of development and of quality of what was developed. However, my amazement stemmed from an even more fascinating aspect.

I was blown away by the Outcome, i.e., what comes out of it in terms of results for the people involved in the development process.

The most significant result is the construction of an environment where mutual respect and cooperation (which is much more than mere collaboration between people) enable effective self-organization. Thus, your work environment becomes a relational and value-based place where you feel the urge to go every day in order to plan and exchange ideas with your team.

All this goes hand in hand with a noticeable and tangible increase in team performance, which translates into a win-win situation for workers and management.

The hierarchical and pyramidal relationships that still characterize many organizations are no longer adequate to cope with a complex world.

Switching to a self-organizational approach requires some training for supervisors at all levels, but it’s an approach you cannot do without once you’ve discovered it.

You can no longer expect to have everything under your control – you have to live with the fact that trained and empowered people will be happy and proud to take on the responsibilities that are necessary to achieve greater autonomy.

The opportunity to work in cross-functional teams is also a powerful way of disseminating knowledge and increasing skills.

This is how organizational learning is fostered, which lays the foundations for a Learning Organization.

Content guide

The first chapters contain a more detailed explanation of why the current and future increasingly complex and vuca context requires a change of approach in product development (Chapters 1 and 2).

I will then elaborate on the meaning of “Innovation” and the conditions for it not to be just lip service but to really permeate the company (Chapter 3). To reap the benefits of innovation indefinitely, we have to be like gardeners who sow, tend and harvest. And here we are not talking about plants but people, who need a special humus to flourish.

Developing products nowadays is a real challenge, as it requires an approach that allows us to adapt to the changes that occur during development. That’s why I’m going to analyze 4 approaches to project management (Waterfall, Lean, Project Management 2.0 and Agile), identifying which peculiarities of each approach are most useful in order to make adaptive planning sustainable – a necessary requirement for product development in a vuca context (Chapter 4).

Once I have clarified why this is necessary and which conditions are needed to make innovation sustainable, I will propose a minimalist, no-nonsense approach to developing a product, starting with an idea and focusing on it more and more until we understand the meaning of the product itself (Chapter 5).

This is accompanied by the need to manage development priorities with a focus on innovation rather than invention (Chapter 6), and by the consequent opportunity to manage a portfolio of ideas and projects (Chapters 6 and 7).

For each idea, both in the early stages and during development, it is very important to focus on the value our product brings to the customer and user (Chapter 8).

The development process that I’m going to outline is “elastic”, in that it is flexible in adapting to change and in being able to appropriately integrate all the advantages of the development methods that have so far been employed for physical products (Chapter 9).

The use of Canvases – i.e., paper or digital boards for visualizing business opportunities related to the development of a new product – helps to bring the idea that lies behind it into sharper focus. Canvases are built by a team involved in product development, marketing and management, and in general by people who have the domain (i.e., product, market and production) knowledge needed for research and to make decisions.

In the development of new products, it is much more important to focus on identifying the most suitable one for the target market than to concentrate on the search for efficiency in the development itself.

It is therefore essential to carefully explore ideas before throwing yourself headlong into development.

With this in mind, particular attention will be paid to whether or not to build “Pretotypes”, which are real forerunners of prototypes to be used as bait to quickly verify the market response to our ideas, as inspired by the Lean Startup logic (Chapter 9).

I will tell you how the “iterative” and “incremental” approach of developing in small steps with continuous course adjustments, which underpins the agile approach, can actually be successfully applied to hardware products.

A process is iterative when, once it has been developed, you can go back over it to rework it – think of the various possible layers of paint that can be superimposed with oil paints.

On the other hand, a process is incremental when it develops from what has already been built and consolidated – in this case, think of watercolor painting, which after a first and single layer only allows brushstrokes in new areas of the sheet.

This application or extension must of course take into account the peculiarities that characterize hardware products compared to software products, as well as the multiplicity of objectives involved in sustainable design.

In the development of a physical product, a multitude of factors must be considered, including, by way of example, design to minimize environmental impact (at the construction stage, during use, and in the process of disposal at the end of its life) and design to simplify assembly and constructability. The approach that integrates these different aspects is called “Design forx” and covers at least 11 of them (Chapter 9).

In a nutshell, the product development project consists of breaking down the project itself into the many things that need to be done, tackling and refining them at the right time and associating them with the value we bring to the customer through the product.

In the agile approach, the “Stories” are the building blocks that make up the to-do list, or Backlog. They are called Stories precisely because they require a conversation between the customer or his/her representative and the developer.

The breakdown of the Backlog and its distribution in the various iterations by means of Story Mapping is a functional and powerful practice, fully employable for physical products as well.

The Agile approach is often identified with the word “Scrum”, meaning a structured way of phasing work in an iterative and incremental manner.

Scrum and story mapping – which were born in the world of software – are proving to be synergistic for physical products too (Chapter 10).

Not everything can be done within an Iteration (the term “Iteration” meaning any step in the iterative and incremental rocess), but this is not a limitation of the agile approach.

The application of the agile approach to the development of physical products is still in a pioneering stage, and I want to contribute to its application in this context by sharing my own original formulation of Hardware Stories (Chapter 10).

Moving from Canvases to product characteristics, and then from these to their impact on the backlog elements concerned or on a group of them, is not immediate. Therefore, I feel that it’s important for me to share an original method that we have developed ad hoc. It’s a structured approach by which product requirements (performance and others) are “transferred” to the relevant backlog elements. We have called the result of this process “Feature Impact Matrix” (Chapter 9).

An element that is common to most physical products – and differentiates them from software products – is the multiplicity of their possible modes of use.

Many of the physical products we use both in a business context and in our private lives have a main use for which they are designed, alongside other uses such as cleaning, maintenance, disposal, etc.

As a simple suggestion on how to manage the impact of this multiplicity of user experiences on the elements of the Backlog, I will share the visual approach of Experience Mapping, which complements the more traditional Story Mapping (Chapter 10).

If you don’t take risks, you will make an ordinary product, which makes new product development inherently risky. That’s why it’s essential to perform a careful analysis of all risks – from high-level risks to operational ones. The agile approach helps us a lot in this respect as well (Chapter 11).

In addition to the extreme usefulness of these Backlog management methods, my personal experience has taught me that when applied to design alone, the agile approach produces limited and not entirely satisfactory results: real change only occurs if you extend it to cover the whole factory (Chapter 12).

The direct experience I had over the years in a company where I was able to see both the effects and the results achieved and achievable by extending this approach to the whole factory was so rewarding and surprising that I have devoted a whole chapter to sharing the methods I experienced with my teams in this area. These effects and results have also been abundantly confirmed by similar experiences in other companies (Chapter 12).

The aim of this book is to be a very practical manual, which is why I have chosen to present three examples of design problems of increasing complexity and the different ways in which they can be handled (Chapter 13).

Last, but not least, comes the chapter dedicated to People in organizations, always keeping in mind the social and cultural context within which they operate (Chapter 14).

For the agile approach to achieve its deserved success, it’s extremely important not to lose sight of the fundamental awareness that global manufacturers (and particularly European and Italian ones) and their employees do not operate in Silicon Valley, but in very competitive industrial districts.

This chapter is particularly meaningful to me, because it encapsulates a great deal of knowledge and personal experience concerning how to make this approach possible in our local contexts, taking into account the conditions in which manufacturers of customized products (and particularly Italian companies) operate, as well as certain characteristics, peculiarities and prerogatives that make them unique on the global industrial scene.

In this regard, I think it’s essential to remember that a real Agile Transition requires an explicit and manifest commitment by the top levels of the company, without which it is destined to have limited results or fail. Although it’s certainly not a problem if it originates “from the bottom”, on the initiative of a head of department, in order to have a real impact on the entire culture of the organization, the leadership of the company needs to fully share the same objectives.

The new and innovative corporate roles of Product Owner (the Project Leader) and Scrum Master (the expert in the agile approach and team coach) have emerged in recent years, and still constitute a real challenge in the context of custom manufacturing.

Since the agile factory is a truly concrete concept, I will briefly recount four business cases that I believe exemplify how this approach can be successfully applied. I will focus on four Italian companies that in my opinion represent small, medium and large enterprises, and that develop products for industrial B2B and B2C use in a very competitive environment.

I hope that my significant experience in the field will give you ideas and inspiration to further explore your own work environment with as much agility as possible (Chapter 15).

Finally, in the last chapter I will summarize what the Agile Factory can be in its essence, which I’ve condensed in the 13 Fundamentals that represent it (Conclusions).

I have written this book riding on the long and intense wave of first-hand experience. What fills me with enthusiasm and encourages me to continue to promote the agile approach is that every day I see how well it manages to adapt to small custom manufacturers. All of this confirms my recent perception (which is recent and ancient at the same time, because “in the beginning there was only doubt”) that this method is extremely suitable for granting sustainability, today and for future generations, to a craftsmanship that has been “added to and augmented” thanks to the very powerful technological and digital tools that are increasingly available, combined with a mental approach and a work culture that are absolutely revolutionary.

01. The Current Context

To practice the art of life, to make one’s life a “work of art” is equivalent in our modern liquid world to remaining in a state of permanent transformation, to perpetually redefining oneself by transforming (or at least trying to do so) into someone other than the one who has gone so far.Zygmunt Bauman

Taylor’s Bathtub

Industrial development started with the first industrial revolution at the end of the 18th century. Before that time, the economy was based on handicraft. The people who conceived products were also responsible for their construction. Thinkers and makers were the same people.

The need to employ agricultural workers and domestic servants – who clearly didn’t have any relevant skills – in the first factories led to an increasingly specific division of labor, which was to develop further with the second industrial revolution, when the positioning of machines and assembly stations began to be organized according to the flow of production. As we all know, this fragmentation of work eventually led to Taylor’s and Ford’s first assembly lines.

It is in the period that follows, lasting about two centuries and including the third industrial revolution, that the fundamental separation between thinkers and makers took place. That’s when management was born and developed with the aim of organizing the work of the makers.

In the second half of the twentieth century, the demand for customization grew more and more, leading the car industry to the creations of modular product platforms – first introduced by General Motors – where different models were made from the same set of basic elements. Later on, a more flexible production line was developed, allowing the production of a finite number of product combinations.

The assembly line and the entire Just-in-Time system developed by Toyota pioneered this production approach, leading to the development of products that are increasingly designed according to customer needs, but always within the limits of a pre-established combination of options provided by the manufacturer. We can therefore speak of a mass configuration process that enables each user to configure their own product, though with the constraints described above.

The advent of three-dimensional design allows accurate simulation ranging from structural to kinematic and dynamic behavior, while new software enables the creation of actual Digital Twins. These factors, in addition to new production tools such as Additive Manufacturing, have opened up the possibility of developing products designed and conceived to be customized for each customer.

That’s why we can speak of “mass customization”, where production methods geared towards efficiency – which characterized the industrial system until the end of the 20th century – are no longer sufficient.

Therefore, the advent of the fourth industrial revolution, in which cyber-physical systems interact with humans, opening the door to mass customization, introduces a major challenge. In an increasingly rapid flow of product renewal, mass customization inevitably requires a rethink of the way we work in offices and factories, where the issue of creativity and flexibility with regard to customer needs cannot yet be solved by a computer alone, even if it’s equipped with the most advanced software.

In other words, companies are being asked to be flexible in an economy that is once again creative, but in a more modern form compared to the craftsmanship of the late 18th century. In these new circumstances, thinkers and makers are no longer the same people, but part of the same team. The challenge of developing products and/or services that integrate technologies, advanced software and hardware development tools and process knowledge is so complex that it can no longer be managed by a single person. It must be handled by a team.

Working in a team is no longer an option but a necessity, because each person in the team is individually inadequate to meet the whole challenge. Only by joining forces is it possible to develop advanced or, as they are called today, smart products that integrate hardware and software technologies.

Figure 1. Taylor’s bathtub – from a craft economy to a creative economy.

Source: Adapted from Niels Pflaeging, Organize for Complexity: How to Get Life Back into Work to Build the High-Performance Organization (Lightning Source 2014).

Creativity in Industry 4.0

The fourth industrial revolution is predominantly described as being pervaded by the presence of cyber-physical systems that interact with humans and are mainly concerned with process efficiency and a more conscious use of machinery.

By processing a large amount of information, artificial intelligence systems help the operator make decisions, and in many cases do so autonomously.

But does this mean the end of man’s work?

Not really, because these approaches that increase production capacity also give us the opportunity to differentiate ourselves. In a competitive market, where efficient production is no longer sufficient, what can make all the difference is being able to develop and produce something designed for each specific customer in a sustainable way.

In order to develop customized elements that make your product stand out from the rest, it’s essential for the creative side to start playing as important a role as the productive side once again.

After all, if a product is not differentiated from another, the only possible dynamic is related to cost and price.

In today’s creative economy, technologies and tools such as 3d printers and new software to support product development do not replace humans, but serve as prostheses. Therefore, the biggest challenge is to build teams that are able to work creatively, because only in this way can they find new answers to complex problems.

Countries like Italy, whose industrial fabric is made up of small and medium-sized companies capable of developing customized products that differ from mass-produced ones, can (and must) seize this great opportunity.

Mass Customization

The creativity used to foster – or rather enabled by – this context allows us to think of mass customization as something sustainable. Contrary to what happened in the 20th century, we can now even conceive of the development of a single unit of a customized product for a specific customer.

Certain types of customers will greatly appreciate this possibility, which will enable them to obtain unique products even at a higher price.

This type of economy, which can be defined as a creative economy, is currently made potentially sustainable by the tools of Industry 4.0, together with new ways of working in teams and increasingly flexible product development processes.

The VUCA World and Innovation

Why are we called upon to change our paradigms for developing products and services? Because today’s world is characterized by 4 elements, encapsulated in the acronym vuca:

V for Volatile

Our current dimension is characterized by speed, dynamism and randomness. Situations are generally unstable and short-lived. We live in a turbulent world, with sudden fluctuations in the markets.

In such a context, seizing opportunities as soon as they appear – or even before they appear – is a clear competitive advantage. However, since these new opportunities do not find existing products available, they require an extremely rapid development process for new products.

U for Uncertain

Predictions are increasingly difficult to make because of current turmoil and frequently unexpected turns of events. The causes producing the effects are often unknown, or very difficult to identify.

In an uncertain world, being flexible and able to change direction quickly when predictions turn out to be wrong is a necessary skill. It requires an ability to correct your course and change direction as soon as you discover that your choice is no longer valid or simply wrong. The alternative is to miss opportunities because you’re not fast enough. Effectiveness is as important as efficiency. Forecasting future consumption based on past consumption – which was common practice in the past – now proves to be fallacious. It can only apply in limited cases, with time intervals of a few months.

C for Complex

The variables are many, as are the connections. The system is a real network, made up of many interactions and the related forces that are created. As there is confusion between what is cause and what is effect, the cause-effect relationship can only be determined ex post facto. If we repeat the same experiment or practice, we’ll get different results.

Under these conditions, you have to be ready to face change and react quickly.

A for Ambiguous

Reality is not as clear as we would like it to be. Cause-and-effect relationships are poorly defined and very blurred.