From hardware and software to integrated solutions – transformation in industrial companies

Industrial companies are undergoing a fundamental shift. Having traditionally developed and sold standalone hardware products, they are now expected to deliver integrated solutions in which hardware, software, and services work together. This creates opportunities for new business models and stronger customer relationships, but it also places greater demands on organizations, ways of working, and technical capabilities.

DeLaval, a Swedish industrial company and global leader in dairy farming solutions, had a clear ambition to develop its offering in a more digital and integrated direction. At the same time, the organization recognized that its development capabilities were not meeting the needs and expectations of the business.

Software development throughput was limited, priorities were perceived as unclear, and several initiatives were competing for the same resources. Despite strong expertise and commitment, complex dependencies, limited prioritization capabilities, and a large number of parallel initiatives were slowing the development process. Several organizational and structural measures had already been introduced to improve delivery capabilities, but they had not produced the desired results.

To understand the underlying causes and create the conditions for lasting change, Knowit and DeLaval conducted an extensive assessment of the product development organization.

Creating meaningful change requires more than optimizing individual parts of an organization. Knowit therefore analyzed the system as a whole—from strategy and governance to operational workflows, technical conditions, culture, and leadership.

Through interviews, reviews of internal documentation, and observations of key forums and processes, Knowit developed a clear picture of the organization’s current state. The analysis showed that the challenges were not limited to individual teams or technical constraints. Instead, they stemmed from gaps in the interaction between strategy, organizational structure, and ways of working.

The assessment identified several issues, including:

• Bottlenecks and inefficiencies in the end-to-end development flow
• Inadequate decision-making data and unclear priorities
• A lack of clarity around roles, responsibilities, and authority
• Low levels of trust between management and development teams
• An overloaded system with significant and partly hidden technical debt

The analysis also showed that software was largely being managed as a series of projects rather than as a continuous product capability. This limited the organization’s ability to develop over the long term and contributed to growing technical debt.

Using a holistic analysis framework, Knowit established a shared understanding of the current situation and the structural causes affecting the organization’s delivery capabilities.

The work resulted in a clear assessment of the current state, creating alignment between management and employees while increasing transparency throughout the organization.

As part of the transformation, a transformation office was established to oversee change management, governance, and coordination of the operational and technical transition. Based on the analysis, DeLaval defined a clear direction for the transformation, focusing on strategy, the operating model, and technical and cultural development.

The work laid the foundation for:

• Greater transparency around capacity and priorities
• Better decision-making capabilities
• Improved coordination between the business and development teams
• Fewer bottlenecks and stronger delivery capabilities
• A more sustainable and cohesive approach to product development

With greater clarity around priorities, governance, and responsibilities, the transformation moved from a fragmented approach toward one that is more coordinated and sustainable over the long term.

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