From Fragmented to Future-Ready: Recruiting for Digital Transformation in Industrial Manufacturing

Digital transformation in industrial manufacturing is no longer optional; it is existential. PE investors who buy platforms in transformers, switchgear, motors, and other grid-adjacent components don’t just need factories that run; they need organizations that learn, adapt, and monetize data. That requires leaders who can move beyond legacy expectations of uptime and cost control to build digitally enabled businesses that grow EBITDA and command higher exit multiples.

This is the recruiting problem at scale: how do private equity firms and operating partners identify, evaluate, and place C-suite leaders who can convert fragmented manufacturing assets into future-ready, digitally driven platforms? The answer starts by rethinking executive recruiting for digital outcomes, not just technology projects.

Why digital transformation matters to PE owners of industrial manufacturing

Private equity’s playbook has always been about improving operations and multiple expansion. Today, digital capability is a direct lever on both. Digitally enabled manufacturers drive higher rates of aftermarket revenue, improve asset utilization, and shorten time to market for product adjacencies, all of which show up in EBITDA and justify premium multiples at exit (see McKinsey’s primer on what digital transformation really is).

A few data points to ground the imperative:

• Nearly all manufacturers are on a digital journey: Deloitte’s recent research found 98% of surveyed industrial manufacturers have started some form of digital transformation, a dramatic jump from prior years. That investment is motivated by customer experience, operational efficiency, and product innovation: exactly the value levers PE owners chase.
• Digital operations deliver measurable ROI when linked to business KPIs. PwC’s guidance on supply-chain digitization and digital operations shows how automation, analytics, and digital procurement materially improve resilience and margins.

Put simply: digital capability equals strategic optionality. For PE portfolios built around roll-ups or platform consolidation, that optionality converts finite cost synergies into recurring revenue and defensible advantage.

Why traditional executive recruiting misses the digital mandate

Most executive search processes were designed for an era when the most important hire was an operator who could squeeze inefficiencies from a factory. That profile still matters, but it is incomplete. The modern leader must blend operational credibility with product thinking, data literacy, and the ability to mobilize cross-functional change.

Common recruiting errors we see:

• Resume bias: Search screens still overweight titles and sector tenure. But a COO who ran perfect uptime at a legacy plant may lack the appetite for data-driven productization or the skill to work across IT, R&D, and commercial teams.
• Siloed assessment: Recruiters often test technical fit or cultural fit in isolation. Digital transformation demands an integrated assessment of technical fluency, strategic mindset, and change leadership.
• Slow pipelines: PE timelines are compressed. Waiting 9–12 months for a “perfect” hire risks losing momentum on digital projects that must be operationalized immediately post-close.

In short: executives who can lead digital transformation are rarer because the competency set is rarer, and generalist executive search firms frequently don’t look for the right signals.

The leader you need: a hybrid of operator, product leader, and integrator

When designing a CEO or C-suite scorecard for digital transformation, look beyond the checklist. The high-impact leader has five intersecting capabilities:

Operational credibility. They must be able to stand on the shop floor and speak the language of production metrics and maintenance schedules. Without this credibility, digital initiatives are dismissed as “IT projects.”

Product and commercial orientation: They understand how to monetize data: aftermarket services, predictive maintenance subscriptions, digital twins, and value-added analytics. McKinsey emphasizes that successful digital transformations are often led from the top with a CEO who treats digital as a strategic revenue engine.

Technical fluency without being a technocrat: They don’t need to write code, but they must evaluate vendors, question data models, and understand integration complexity (OT/IT convergence).

Change leadership and cultural wiring: Digital transformation is culture change. Leaders must translate complex technical initiatives into simple operational outcomes and incentives. As we argued in our white paper series, cultural alignment between legacy teams and PE urgency is a recurring make-or-break factor. (See When Legacy Leadership Meets Private Equity Ambition.)

M&A and integration savvy: For roll-ups, the leader must be able to preserve speed while standardizing platforms, turning bolt-on acquisitions into nodes of a single digital fabric.

When you recruit for those five capabilities, you recruit for durability and for the resilience premium, the performance uplift that accrues to companies that can monetize digital investments.

Practical screening signals that predict digital success

Executive search firms and PE talent teams must ask better questions and look for different evidence. The following are practical screening signals that correlate with success:

• Concrete monetization examples: Candidates who can point to specific initiatives where digital work was tied to incremental revenue or margin (e.g., launch of a service line, subscription product, or new aftermarket offering).
• Cross-functional delivery track record: Evidence that they delivered projects that required OT and IT teams to integrate, with measurable outcomes. Deloitte’s work highlights that digital programs succeed when operations leaders who own them test for that ownership.
• Vendor and partner orchestration: Experience managing industrial SaaS or IIoT vendors and negotiating SLAs and data-sharing frameworks.
• M&A digital integration experience: Especially in roll-ups, look for leaders who have standardized KPIs, data models, and tech stacks post-acquisition.
• Behavioral adaptability: Use case-based interviews to surface examples of pivoting under constraint and learning quickly.

These indicators are more predictive than pedigree alone. A specialized executive search firm will build interview frameworks and simulations that surface them.

How PE investors should structure the hire and the first 12 months

Recruiting is only half the battle. To capture the resilience and value of digital transformation, PE sponsors must set the conditions for success:

Tie incentives to digital outcomes: Link a portion of long-term incentives to recurring revenue, service attach rates, or data-driven margin improvement rather than one-off cost savings.

Fund a 100-day digital sprint: Allocate capital and a small, cross-functional “digital task force” to validate use cases, run pilots, and establish baseline ROI metrics.

Measure what matters: Move beyond uptime KPIs to adoption KPIs: percent of assets on IIoT, mean time to insight, and add-on sales enabled by analytics.

Partner with a specialized executive search firm early: They bring pre-vetted candidates who’ve done this work and can compress hiring timelines without sacrificing rigor. Reports from PE talent specialists show how targeted search models shorten time-to-impact.

When these elements align, the CEO’s digital agenda becomes a measurable value driver rather than an aspirational roadmap.

Avoiding common pitfalls

Even well-intentioned digital programs fail. The usual failures are instructive:

• Treating digital as a project, not a capability: Transformations fail when companies don’t institutionalize digital processes, data governance, and product management.
• Underestimating retrofit complexity: Brownfield factories have unique constraints; retrofitting sensors, network, and controls requires pragmatic phasing and realistic timelines. PwC offers guidance on sequencing and brownfield strategies.
• Hiring the wrong leaders: A purely technical CTO without operational credibility will struggle to get buy-in; a legacy COO without a product mindset will stall commercialization. Balanced, integrated profiles win.

The payoff: how digital leaders change the economics of manufacturing platforms

When executed well, digitally driven platforms outperform on three financial fronts:

• Expansion of recurring revenues: Aftermarket services and software subscriptions increase customer lifetime value and stabilize cash flow.
• Higher multiples at exit: Buyers pay premiums for predictable, recurring revenues and demonstrable data assets. PE value creation research shows revenue growth and multiple expansion are increasingly dominant drivers of exit value. Digital capability feeds both.
• Operational resilience and margin upside: Better predictive maintenance, yield optimization, and dynamic scheduling produce sustained margin improvement beyond one-off cost cuts.

These outcomes are not hypothetical but the measurable results that savvy PE sponsors seek when they deliberately recruit leaders for digital transformation.

Recruit the leader who builds the digital muscle—not the fastest cost cutter

Industrial manufacturing is no longer a game of steady operations. It’s a race to convert legacy assets into data-enabled platforms that can scale, adapt, and monetize. For private equity owners, the difference between a fragmented set of plants and a future-ready platform is the leadership you place at the top.

Executive recruiting for digital transformation is a different discipline: one that marries operational credibility, product thinking, and change leadership. If you want the resilience premium, begin by demanding it from your next CEO and C-suite hires, and partner with an executive search firm that understands both PE pressure and industrial complexity.

If you’d like to discuss building a digital-ready leadership bench for your manufacturing portfolio, let’s talk: Contact Kersten Talent Capital.