Samsara Research Shows Digitization Improves Business Resilience and Profits for Operations Leaders
Report shows tipping point in the digital transformation of physical operations; reveals that AI adoption aids in employee retention, satisfaction, and safety.
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Samsara Inc. has released results from its inaugural State of Connected Operations Report. Perspectives from more than 1,500 operations leaders revealed how digitization drives business resilience, why the new industrial workforce is demanding intelligent tools, and how investments in sustainability are paying off. The research found that connected operations leaders -- those who reported the highest level of digital maturity -- are better equipped to thrive in 2022 and beyond.
“Operations leaders are managing through a turbulent time marked by record inflation, rising interest rates, and immense supply chain pressure. While they have a long history of surviving challenging economic cycles, what’s different this time is the advantage of digitization,” said Sanjit Biswas, co-founder and CEO of Samsara. “Our new research puts a stake in the ground on what it takes to be resilient. Connected operations leaders are ahead of the pack and represent what’s possible with the right action and technology.”
Business Resilience and Profitability Hinge on Digital Transformation
The supply chain model that operators trusted broke during the COVID-19 pandemic. The global economy’s most important industries have since faced historic levels of disruption. Leaders seek restoration but also a fundamental change in their operations that will provide resilience in the decades to come. Digitization is enabling new agility as leaders can assess and respond based on real-time data. Samsara found that 95 percent of respondents agreed that digitizing their operations improves their ability to weather disruptions.
Connected operations leaders are reaping the financial benefits of digital transformation, as 99 percent have seen increased net profit from such investments. Compared to respondents in the beginning stage of digitization, connected operations leaders were nearly twice as likely to exceed revenue goals. Considering 86 percent of respondents in the beginning stage of digitization reported investments paying off, it’s clear digital technologies have the power to deliver ROI quickly and can help organizations weather economic challenges.
Legacy systems are holding organizations back and siloed data is compounding problems; 89 percent of respondents agreed that disjointed technology and data negatively impact their bottom line. Modernizing the technology stack is top of mind to address this challenge, as 84 percent stated updating legacy tools is a high or critical priority for their organization this year. Organizations that digitize smarter and faster can reap the benefits sooner and better equip the business to rise above future challenges.
The Industrial Workforce Demands Modern Tools and Flexibility
Operations leaders are not immune to the Great Resignation and extremely tight labor markets. Zeroing in on one country and industry, consider if every unemployed person with experience in the durable goods manufacturing industry in the United States was employed, the industry would still only fill 65 percent of the vacant jobs.
The industrial workforce has new demands -- modern tools that increase safety, improve workflows, and stack up to the technologies they use in their personal lives. Samsara found the most influential factors for recruiting and retaining employees were improving workplace safety (56 percent) and implementing easy-to-use technology (54 percent).
The era of remote work has left a lasting imprint on physical operations. Almost all respondents (91 percent) currently offer technology that enables employees to perform some or all of their work remotely. Further, implementing flexible work options this year is a high or critical priority for 81 percent of respondents. For example, organizations can now use real-time diagnostics to complete asset inspections remotely, which increases safety and could save an employee a multihour round trip to a remote site.
Connected operations leaders quickly adapted to this shift and were 6.5 times more likely to offer remote work technologies to all of their employees compared to respondents in the beginning stage of digitization. Organizations with antiquated ways of working and a lack of response to workforce demands will find it difficult to retain employees and attract the digital natives that are quickly making up the labor market.
AI and Automation Bolster Employee Retention and Satisfaction
Applications of artificial intelligence (AI) and automation -- such as AI cameras and automated workflows -- have become vital for physical operations. For example, AI dash cameras are increasing safety on the road and exonerating drivers from false claims, which can reduce costs by hundreds of thousands of dollars for an organization.
Samsara found that 90 percent of respondents have implemented AI and automation technologies or plan to by 2023. These technologies can address a need for increased safety and enable employees to spend less time on repetitive tasks. The vast majority (90 percent) said they expect to increase employee retention as a result of AI and automation adoption. Further, the 95 percent who have already implemented these technologies report it has led to increased employee retention.
Other benefits respondents indicated include greater business agility (45 percent), greater employee safety (44 percent), greater upskilling opportunities for employees (43 percent), and greater employee satisfaction (43 percent). Compared to respondents in the beginning stage of digitization, connected operations leaders were more likely (+31 percent) to report higher employee satisfaction as a benefit. AI and automation are becoming integral to improving employee experience.
The Time is Now for the Rise of Connected Operations
Of the more than 1,500 operations leaders Samsara surveyed, only 7 percent reported the highest level of digital maturity -- indicating that the digital transformation of physical operations is in its early stages.
Biswas added, “The digital transformation of physical operations is a multidecade shift that will
save lives, reduce carbon emissions, and keep the flow of goods, services, and people moving. Connected operations can guide greater profitability, higher employee satisfaction and retention, increased access to business opportunities, and a more sustainable future.”
To learn more about the State of Connected Operations Report, please visit Samsara here.