How companies can tackle digital transformation
At first glance, digitisation is just another item on the to-do list for many companies. Only when they take a closer do they notice the opportunities it offers them for the future. But even those who are ready for digital transformation are faced with the question: how do we start?
Nicolas Fulpius, CDO, Swisscom Enterprise Customers, August 2016
Digitisation is nothing new. Many everyday applications have been digital for decades. What is new, however, is the speed of digitisation. An increasingly integral part of our everyday lives, digitisation is made possible by numerous high-performance networks and smart devices. People, things and machines are becoming more and more connected.
The reason for digitisation is simple: to make the most of the countless opportunities to use these new technologies within our own value chain:
But what do companies need to do in order to use digitisation profitably?
Let’s be clear: there is no standard recipe for successful digitisation. The lightning speed of digitisation makes it almost impossible to come up with reliable, one-size-fits-all forecasts. What we know today can be old hat by tomorrow. This uncertainty is becoming part of our everyday lives. But that is no reason to give up. Instead, every company should ask itself how digitisation can be integrated into its own business model in a profitable way.
A good place to start is to examine value chains critically from a digital perspective. Whoever uses digitisation can simplify existing processes and offers, and build new services on top of existing ones. Anyone who thinks digitisation does not concern them is playing into the hands of their competitors, who these days are often from other sectors. A quick start is essential. Although they are no recipe for success, here are three practical steps to get started:
Digitisation involves much more than just IT, affecting companies at every level, from process optimisation to employee skills. It therefore needs to be part of company strategy. Senior managers decide which parts of the business are suitable for digital transformation, what should be digitised and in which order of priority. Management must not cling onto past decisions and strategies, but must have the courage to change, even if it means abandoning a project and starting again. Orderly failure must be possible in order to learn. A dedicated team reports directly to senior management, with all relevant activities and measures orchestrated by the Chief Digital Officer.
These days, it is simply no longer feasible for companies to keep working on a product behind closed doors until it is perfect. It is much better to implement projects using iterative methods and beta versions, make constant improvements and establish interfaces with new technologies. Fast prototyping is a promising strategy, enabling customer or user feedback to be quickly collated before the costs become too high. Time to market is also much shorter with this approach.
Companies must involve their staff in digital transformation because it concerns everyone, from trainees to board members. It will substantially change employee requirements in the long term. Only companies that educate their staff early on and take them with them through the transformation process will be able to access the full potential of digitisation. The speed of the process and the iterative approach also require a complete rethink of the management system. Strict hierarchies and control systems are becoming a relic of the past, replaced by agile organisations and network leadership.
Anyone who wants to be a successful entrepreneur these days needs to be aware that digitisation affects all sectors. Anyone who wants to gain the greatest benefit for their company needs to start experimenting now, try new things and approach transformation in a holistic way. With the right support from management, an agile, adaptive structure and a “fail fast, fail cheap” approach, the move towards digitisation can be successful.
After several years in private equity and venture capital, Nicolas Fulpius was appointed CEO of Veltigroup, which was bought by Swisscom in 2015. He became Chief Digitalization Officer at Swisscom Enterprise Customers in July 2015 and head of the Digital Enterprise Solutions department in June 2016. Nicolas Fulpius has an MBA from the University of St. Gallen and an MSc in engineering from Stanford University.
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