How companies pragmatically
be able to deal with digitalization
Digitalization is based on the combined development of constantly increasing computer power, ever closer and more broadband networking and ever more intensive and increasingly mobile use of digital services via the Internet. This combined development has now reached a level in western industrialized nations that is making its effects felt by everyone and forcing companies to evolve in order to survive in the digital world.
The “noticeable effects” are quickly explained: When was the last time you withdrew money from a bank counter, bought a train ticket at a travel center or checked in with a boarding pass that you didn’t print out yourself? However, we are not only feeling the effects of digitalization as consumers, but also as employees. From the checkout assistant in the supermarket, who is being replaced by a digital checkout machine, to the bank advisor, whose work is largely carried out by semi-intelligent algorithms, to the doctor in private practice, who not only has to deal with his patients’ half-baked internet research, but also with their reviews on portals such as Jameda and Co.
Of course, we are also affected as entrepreneurs: self-confident customers, whether private consumers or business customers, demand comprehensive digital support as a matter of course. Changing customer expectations and the digitally enhanced services with which they are served are having an unprecedented impact on companies’ business models, IT, organization, processes and culture. The speed at which these changes are (or have to be) taking place makes things even more difficult. The changes described so far have all occurred in the last ten years. To give a more concrete idea of the upcoming changes, here are some of the effects of digitalization on various areas of the company:
Customer relations
The Internet, with its countless comparison portals and social networks, where prospective customers can find out about the features and prices of a product/service in detail and also make their criticism of products once purchased public immediately and virtually worldwide, gives the customer unprecedented power. The saying “the customer is king” has never been truer than in the digital age.
Business models
It is now a well-known fact that the business models of many companies are evolving from product sellers to (digital) service providers. In order to develop digital or digitally enhanced business models, whether disruptive or evolutionary, companies need flexible and fast IT that enables them to develop, provide and bill their services and constantly adapt them to rapidly changing customer needs.
Technology
Digitization goes far beyond information processing. It has many business, organizational and cultural aspects. But IT is the foundation. Companies cannot operate their digital business models without modern IT. With digitalization, IT and products/services are growing ever closer together. While production and product development are still separate from the company’s internal IT, these areas are merging and becoming “Operation Technology” (OT), which plays a key role in all areas of the company. This OT must not only be characterized by a high degree of flexibility and agility, which is primarily based on standardized interfaces, modularity, openness and cloud computing, but also by a large number of networked end devices and greater security. From today’s perspective, these requirements can only be realized for most companies via so-called digital business platforms, which have the desired features but reduce the complexity for the application company compared to today’s enterprise solutions.
Organization
In the future, companies will change much faster and more frequently than they do today. Whereas companies and business models used to be one, in future companies will have to organize themselves in such a way that they can not only survive business model changes, but also shape them themselves and benefit from them. This means that they can expand their employees’ skills relatively quickly and change their processes rapidly. This has far-reaching implications for management, work concepts, personnel development and further training programs. Architectures must also be developed for the processes and workflows in companies that allow process sections to be redesigned and recombined during ongoing operations.
We are currently finalizing a white paper in which we will describe the demands that digitalization places on SMEs in particular, how companies can meet these challenges and how they can implement digitalized business models and processes. With the help of its major software partners, PTA not only offers the relevant technologies, but also a set of methods that can be used to implement their projects in a very practical way, from initial strategic considerations and process design to the selection of suitable platforms and services and the involvement of employees. The white paper will be published in mid-February.
We will keep you up to date on this.
