A range of research and industry experience demonstrate that between 60 and 90% of all Industry 4.0 pilot or Proof of Concept (PoC) projects never progress beyond that initial stage. McKinsey and Co. even coined the term “Pilot Purgatory” for this state of paralysis in implementing digital transformation projects. We will all have different ideas of “Purgatory” but I expect that none are a place we would like to be…

When it comes to Industry 4.0 projects, there are many reasons why this happens. At #sales4.0 we work with Industry 4.0 focused tech companies (many of which are startups) that need to build proof points and demonstrate the value of their tech to industry, while validating their product and gaining critical user feedback. We work with our clients to design successful Pilots/PoCs. Considering why they go wrong and how to avoid these pitfalls is key to developing successful projects.

So, let’s start with what typically goes wrong – as always, it’s very rarely “just one thing” so look out for these bear traps:

• Little focus is given to how to scale-up if the pilot is a success – often driven by technical rather than operational teams – this is the “see what happens” approach
• Lack of senior management engagement – someone has budget to spend on digital transformation and the wider issues – e.g. cost/benefit of full scale implementation do not get considered with enough rigour
• Too much focus on “what” and “how”, not enough focus on “why?”. There are many factors to deal with in digital transformation but the most difficult are not usually the tech
• Lack of clarity and focus on “what good looks like” – some Pilot projects do not have basic success criteria.
• Not enough focus on the role of People and Processes in digital transformation – everyone is thinking about how the tech will perform but to do so it will drive change for how work is done and the people that do it

Of course, there are many really successful pilot projects out there proving some exciting, innovative tech and use-cases in Industry 4.0 – it’s been my pleasure be involved in some of them. There are many factors which drive this success and these are some of the things that move the dial.

• Start with “Why” – what is the business benefit, objective, impact on the people and processes?
• Get the whole team to think of the pilot as Phase 1 of a major project – the completion of the PoC is just a stage gate in implementation.
• What does the business case for a successful scaled-up project look like – quantify the value
• How do those metrics translate on a smaller scale in the pilot? Define quantified success criteria and get all the stakeholders on board
• Structure pilots that build confidence and credibility. Digital transformations are not achieved immediately – success might need to be demonstrated one bite at a time
• Plan properly for implementation (at least high level) – what are the challenges, risks, costs, resources, dependencies? What are the go/no-go factors that need to be tested in the pilot to build confidence?
• Involve the people – successful pilots bring together disciplines including tech, operations, data and process to design and deliver a project that delivers proof of concept

Avoiding the pitfalls is important of course – none of us want to end up in Pilot Purgatory! But changing the approach to PoCs will not only improve your chance of project success but also improve your understanding of the business problems that you are solving and critically. the value of your product.