Embracing Digital Transformation - Review of solutions.hamburg 2019

Digitalization experts from all over Germany met for the fifth time between 11 and 13 September in Hamburg's Kampnagel for solutions.hamburg. The fact that the challenges posed by digital change have not diminished in the years of the conference's existence was again impressively demonstrated by the more than 5,000 visitors and more than 100 partners who once again gathered in the Hanseatic city. Of course, mgm was also on site to discuss the consequences of the digital transformation with the visitors.

In the third year mgm Platinum was sponsor of solutions.hamburg and had put together a diverse series of lectures for the Strategy Day on 11 September. Numerous top-class decision-makers from industry and society reported to an interested and knowledgeable audience on the concrete answers their organisations have already found to the problems of digital change. True to the track title "Embracing Digital Transformation", the speakers focused on the opportunities and possibilities of digital change - without ignoring the existing problem areas.

Digitalisation as a tool against climate change

Climate change turned out to be one of the main topics of some of the presentations. It has been dominating the German headlines for months now and digitisation could provide some solutions for this problem. For example, Christa Koenen, CIO of Deutsche Bahn and CEO of IT service provider DB Systel, reported in her keynote speech on the efforts made by Deutsche Bahn to make its contribution to the fight against climate change. Accordingly, the Group will expand its capacities by 30 percent in the coming years in order to significantly increase passenger numbers. However, such a leap would not be possible with a large-scale infrastructure expansion alone. On the contrary, the possibilities of digitisation must be used consistently in order to make the railways the most environmentally friendly means of transport and the future backbone of mobility. However, the technical challenges such as the planned cloud migration and the integration of new systems into the existing legacy are not the major stumbling blocks within this change. Rather, the classic hierarchical structures within the organisation would have to be dissolved in order to give the group the flexibility and speed necessary for this transformation. The railway is on the right track, but it is far from over.

Your colleague Bernd Rattey, CIO at DB Fernverkehr, focused his attention on the cooperation between business and IT, which is crucial for the success of digitization. In view of the success formula "Business x IT x Cooperation", none of the departments should pull themselves out of relevant initiatives. This demands a new self-image from both business and IT. For example, IT should no longer see itself merely as a service provider to the specialist departments, but should learn to understand that its work also makes an important contribution to connecting metropolises and networking regions.

The fight against climate change is also a defining theme of Dr. Britta Oehlrich's daily work, Head of Business Unit Development at Hamburger Hochbahn. After all, the largest transport company in the Hanseatic city has also set itself the goal of significantly increasing its passenger numbers over the next ten years. However, Oehlrich does not see the key to this growth in the publicly discussed and intensively discussed fare reductions, as these would take money and thus scope for investment out of the system. Instead, customers would have to be convinced by public transport with exciting offers. This would also include new micromobility technologies such as pedal scooters and autonomous driving for the elevated railways. In this context, it is important to test new ideas quickly and to be able to withdraw them from the market in the foreseeable event of failure. After all, falling on one's muzzle is also a kind of forward movement.

Digital change turns the energy and insurance markets to the left

But not only the mobility industry is feeling the effects of the climate change debate. As Philipp Richard, Team Leader Energy Systems and Digitisation at the German Energy Agency (dena), explained in his presentation, the energy sector is also facing considerable changes. For example, it can be assumed that there will be a noticeable decentralisation of energy production, which will also bring numerous new and innovative players into the market. One of the biggest challenges facing the energy industry is to create the necessary confidence in this environment to be able to work together quickly and efficiently. The blockchain technology could be a valuable help at this point.

Matthias Schwanitz, Chief Sales Officer Municipality at REVUlution, also spoke about the concrete challenges facing energy suppliers. The energy market is characterised above all by new customer behaviour. As a result, today's customers not only expect digital services, but are increasingly willing to change their energy supplier to save money. This development, which is also being driven by increasing competition, is increasingly putting companies under price pressure and forcing them to increase efficiency considerably. From Schwanitz's point of view, consistently questioning processes that do not add value without impairing the customer experience is the balancing act that energy companies have to master in this environment.

In the course of digitalisation, the insurance industry is also faced with great imponderabilities, which represented Robert Weidinger, CDO of life insurance from 1871, among others, on the mgm track. In his lecture, however, Weidinger advocated seeing opportunities above all in these challenges. Thus, digital change offers numerous opportunities to optimize existing business models (digital enabling), to expand existing business areas and distribution channels (digital expansion) and to develop entirely new business areas (digital innovation). However, both the systems and processes as well as the corporate culture and the employees must be prepared for the associated changes. A previously defined company mission, as in the case of LV1871 the "preservation of quality of life", could provide a suitable framework for this.

Detlef Gastner, Lead Project Manager at ottonova, the first digital health insurance company, also sees the insurance industry facing fundamental change. Insurance companies today could no longer afford not to offer their customers a comfortable, integrated and intuitive experience and to leave them alone after signing a contract. For this reason, his company relies on strict customer orientation, for example with a concierge service, automatic appointments with doctors and video chats with doctors. The customer wanted it digital.

Customer orientation is an important key

Strict customer orientation also plays a key role in the financial company Barclays, as Head of Digital Capabilities Kirstin Hütz reported. Finally, banks and payment service providers also have to deal with numerous changes. The market entry of new players, technological developments such as mobile payment and regulatory requirements such as PSD2 have the potential to radically transform the payment industry. In order to assert oneself in this volatile business environment, an orientation towards User Centric Design is a necessary prerequisite.

Concrete customer requests were also the reason why the ship register in Hamburg is currently being digitised. Up to now, new registrations and changes in ownership have been made in analogue register books, which is associated with a high and time-consuming workload. In the event of delays, there is also a risk that ships will have to remain in port and that the shipowners concerned will lose money. In order to strengthen its own port location, the Hanseatic City has therefore decided to develop a lean digital application within twelve months, which can also serve as a prototype for further digitisation initiatives in the public sector. According to IT manager Florian Strunk, who presented the project on the mgm stage, the application will go live on January 1, 2020, which would certainly prove that successful digitization projects are also possible in the allegedly dusty German offices.

More familiar with digital initiatives are certainly Tim Döppner, Managing Director of Digital Platform, and his colleagues at Schwarz IT. After all, with Lidl's online presence they are managing one of Germany's largest e-commerce retailers in an extremely competitive environment. Nevertheless, even with such a successful online retailer, it is necessary to constantly work on problems that threaten the company's ability to act. From the danger of dependency on external knowledge to the difficulty of connecting business and IT to the fear of agility - in his presentation Tim Döppner gave numerous tips on how large corporations can remain innovative and flexible.

The focus is on the employee as a person

Robert Bosch GmbH is also facing similar problems. According to Anke Dewitz-Grube, Director Consultant for Lean Agile Transformation, the necessary reorientation can be helped in particular by looking at company founder Robert Bosch. In his time, he too would have had to repeatedly realign and diversify his business. There have always been changes, only the nature of the changes has changed as a result of digitisation. What is particularly new is that you have to align your business, although you can no longer predict a target in the VUCA environment. The employees would have to be prepared for this, for example in coaching discussions.

In his talk, Arndt Frischkorn, Leader Transformation & Capture Support at Saint-Gobain, also dealt with the effects of the change on employees. In his view, both digital and agile transformation pose new challenges for both managers and ordinary employees, which can sometimes be threatening. It is only natural that those affected in this situation resort to evolutionarily predetermined coping strategies (fighting against danger, escape, death). Classical coaching is not sufficient at this point, as it only addresses the awareness and knowledge of the employees. However, the subconscious that has been formed throughout the employee's life by his experiences also has a considerable influence on behaviour. Therefore, this should also be addressed in coaching measures. This is a lengthy and intensive process, but it is worth it. The numerous visitors of the mgm track were able to follow this view without reservation.