Skip to main content
Disciplines
Automotive Business IT + Informatics Construction + Real Estate Electrical Engineering + Electronics Energy + Sustainability Insurance + Risk Finance + Banking Management + Leadership Marketing + Sales Mechanical Engineering + Materials
Events
DE
EN
Books
Journals
Topic Page
Marketing
Start single access now
Access for companies
EXTENDED SEARCH
Log in
Top

2021 | Book | 1. edition

Introduction to Digitalization Cases Vol. 2: Mastering Digital Transformation for Global Business Read chapter Read first chapter

Digitalization Cases Vol. 2

Mastering Digital Transformation for Global Business

Editors: Nils Urbach, Maximilian Röglinger, Karlheinz Kautz, Rose Alinda Alias, Carol Saunders, Martin Wiener

Publisher: Springer International Publishing

Book Series : Management for Professionals

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Technik" , Springer Professional "Wirtschaft"

Login to get access
insite
SEARCH

About this book

This book presents a rich compilation of real-world cases on digitalization, aiming to share first-hand insights from renowned organizations and to make digitalization tangible. With all economic and societal sectors being challenged by emerging technologies, the digital economy is highly volatile, uncertain, complex, and ambiguous. It confronts established organizations with substantial challenges and opportunities.

Against this backdrop, this book reports on best practices and lessons learned from organizations that succeeded in tackling the challenges and seizing the opportunities of the digital economy. It illustrates how twenty organizations leveraged their capabilities to create disruptive innovation, to develop digital business models, and to digitally transform themselves. These cases stem from various industries (e.g. automotive, insurance, consulting, and public services) and countries, covering the many facets that digitalization may have. As all case descriptions follow a unified template, they are easily accessible for readers and provide insightful examples for practitioners as well as interesting cases for researchers, teachers, and students.

Almost every organization is trying to figure out how best to respond to the opportunities and threats posed by digitalization. This book provides valuable lessons from those organizations that have already begun their digital transformation journey.

Michael D. Myers, Professor of Information Systems, University of Auckland

Digitalization Cases provides firsthand insights into the efforts of renowned companies. The presented actions, results, and lessons learned are a great inspiration for managers, students, and academics. This book gives real pointers on the how and where to start.

Anna Kopp, Head of IT Germany, Microsoft

The cases compiled in the second volume of Digitalization Cases show how disruption can actively be managed. Further, long-term insights from extended success stories of the first edition highlight that courage to change pays off well. This book represents a motivation for organizations to drive their digital transformation journeys actively.

Markus Richter, State Secretary at the Federal Ministry of the Interior, Building and Community and Federal Government Commissioner for Information Technology, Germany

Table of Contents

Frontmatter
Introduction to Digitalization Cases Vol. 2: Mastering Digital Transformation for Global Business
Abstract
Digitalization confronts organizations with huge challenges and opportunities. With all economic and societal sectors being affected by emerging technologies, the digital economy is highly volatile, uncertain, complex, and ambiguous. Against this backdrop, this book reports on the best practices and lessons learned from organizations that succeeded in tackling the challenges and seizing the opportunities of the digital economy on a global scale. It illustrates how 20 organizations leveraged their capabilities to create disruptive innovation, to develop digital business models and to digitally transform themselves. These cases stem from various geographical regions and industries, covering the many facets that digitalization may have.
Nils Urbach, Maximilian Röglinger, Rose Alinda Alias, Karlheinz Kautz, Carol Saunders, Martin Wiener
Correction to: Enabling Digital Transformation Through Cognitive Robotic Process Automation at Deutsche Telekom Services Europe
Christian Czarnecki, Chin-Gi Hong, Manfred Schmitz, Christian Dietze

Digital Disruption

Frontmatter
Enabling the Digitalization of Claim Management in the Insurance Value Chain Through AI-Based Prototypes: The ELIS Innovation Hub Approach
Abstract
(a)
Situation faced: Digital transformation in the insurance value chain is fostering the adoption of artificial intelligence, namely, of deep learning methods, for enabling the improvement and the automation of two relevant tasks in the claim management process, i.e., (i) sensitive data detection and anonymization and (ii) manipulation detection on images. The proposed approach is technically feasible, lightweight, and sufficiently scalable due to the properties offered by currently available cloud platforms, and it also yields a sensible reduction in operational costs.
 
(b)
Action taken: Since well-established guidelines to address insurance digitalization use-cases requiring deep learning do not yet exist, we propose a customized data science workflow for designing and developing two prototypes that tackle: (i) sensitive data detection and anonymization and (ii) manipulation detection on claim images. We propose a six-step method that is implemented using deep convolutional neural networks in Keras and TensorFlow and is seamlessly integrable with the most frequently used cloud environments. During prototyping, different training and testing iterations were carried out, thus progressively fine-tuning detection models, up to the achievement of the desired performance.
 
(c)
Results achieved: The developed prototypes are able to (i) robustly anonymize claim images and (ii) robustly detect manipulations on claim images (robustness means that, from a statistical viewpoint, the declared performance level is preserved even in the presence of highly heterogeneous distributions of the input data). The technical realization relies on open-source software and on the availability of cloud platforms, this last both for training purposes and for scalability issues. This demonstrates the applicability of our methodology, given a reliable analysis of the available resources, including the preparation of an appropriate training dataset for the models.
 
(d)
Lessons learned: The present work demonstrates the feasibility of the proposed deep learning-based six-step methodology for image anonymization and manipulation detection purposes and discusses challenges and learnings during implementation. Specifically, key learnings include the importance of business translation, data quality, data preparation, and model training.
 
Alessandra Andreozzi, Lorenzo Ricciardi Celsi, Antonella Martini
Invoice Automation: Increasing Efficiency in the Office at Satherm GmbH Using Artificial Intelligence
Abstract
(a)
Situation faced: The application of artificial intelligence (AI) to automate business processes is becoming more important in small- and medium-sized enterprises (SMEs). This was also recognized by the company Satherm GmbH. With 20,000 invoices per year, which were all being processed manually, invoicing at Satherm was accompanied by high process costs and a high expenditure of time. Furthermore, Satherm struggled with regional socio-economic difficulties such as a shortage of skilled workers and recession for which a solution had to be found. In view of the situation at Satherm GmbH, automation using AI technology offered a great potential not only to reduce manual activities and costs but also to overcome regional problems.
 
(b)
Action taken: State-of-the-art technology consisting of seven established neural networks for superior, cognitive and automated document recognition and extraction was used in combination with a free-to-use robotic process automation (RPA) technology to automate the process from invoice receipt to payment. The implementation consisted of three steps. The first one dealt with requirement analysis, conception and identification of the necessary interfaces. To reliably extract valid data of invoices, the second step addressed the adaptation of the neural networks to the underlying documents at Satherm by means of transfer learning. The last step involved the setup of the holistic solution and the piloting in the company to test the solution parallel to the daily business followed by a smooth transition into final roll-out at Satherm.
 
(c)
Results achieved: Considering the set goal of an invoice automation degree of 50%, the results achieved exceeded the expectations at Satherm by 20%. With an overall invoice automation of 70%, the invoice processing time was reduced from 15 days to 2–3 h per invoice. Complementary to this the costs for processing an invoice were reduced from € 5.77 to € 1.93. This resulted in a cost saving of about 67% per invoice. In addition, the implementation was not only accompanied by a positive impact on the process efficiency itself but also by several positive side effects like countering the current as well as future shortage of skilled workers at Satherm.
 
(d)
Lessons learned: The use case of Satherm is a suitable lesson to understand how digitization and especially the application of almost ready-to-use artificial intelligence in German SMEs can increase efficiency, raise potentials and be the solution for different challenges. A sufficient pilot phase parallel to business operations can be recommended when introducing new technologies in order to build trust in the technology and ensure full integrity. With that an AI application can be the driver for the discovery of further potentials and an accelerator towards a more digitized, efficient company.
 
Martin Danner, Björn Maurer, Svea Schuh, Tobias Greff, Dirk Werth
Digitalization of Manufacturing Processes with Startup Collaboration: Arçelik Developing a Digital Twin with Simularge
Abstract
(a)
Situation faced: Arçelik is a major manufacturer of durable consumer goods. As one of the primary products of Arçelik, refrigerators constitute 35% of its annual production. Thermoforming is a critical process of manufacturing a refrigerator’s inner body, which consumes more than 20,000 tons of plastics every year. The company has decided to develop its production quality further, reduce plastic consumption, and improve its environmental footprint by integrating a digital twin into its production planning and management.
 
(b)
Actions taken: Arçelik has partnered with Simularge from Istanbul, a startup specializing in digital twins. The project team has developed a digital model of the thermoforming process by combining high-end engineering formulations, simulation modeling, and real-time sensor data. They have integrated and fine-tuned the digital twin in one plant. Currently, the company plans worldwide deployment.
 
(c)
Results achieved: Arçelik’s partnership with Simularge has successfully generated a digital twin of the thermoforming process. Implementing the digital twin with real-time operational data has improved the product quality, has decreased scrap ratios, and has reduced plastic consumption. It has resulted in an initial cost-saving of more than $2 million annually. Gaining know-how about the manufacturing processes’ digitalization has promoted a shared vision. It has also provided a strong example to encourage the digitalization of other manufacturing processes.
 
(d)
Lessons learned: The digital twin has enabled resource efficiency and improved manufacturing execution. Additionally, integrating the Internet of Things data into the digital twin has enabled better feature engineering results and improved algorithms with extracted features from data mining. Furthermore, the Internet of Things and programmable logic controller infrastructures and engineering capabilities at Arçelik has been crucial for the digital twin’s success. Arçelik’s Atölye 4.0 Lab and its relationship with Istanbul Technical University’s ITU Çekirdek Incubator also have a significant role in cultivating a collaborative project. Lastly, effectiveness in project management appears as a significant driver of success for a digital twin project.
 
Nihan Yıldırım, Deniz Tunçalp, Gizem Gökçer İstanbullu, Yiğit Konuşkan, Mehmet İnan, Oğuz Yasin, Büryan Apaçoğlu-Turan, Erhan Turan, Ömer Faruk Özer, Vügar Kerimoğlu
Using Blockchain to Coordinate Federal Processes: The Case of Germany’s Federal Office for Migration and Refugees
Abstract
(a)
Situation faced: The German asylum procedure requires close cooperation and information exchange between various authorities at the municipal, state, and federal levels. Federal separation of competencies inhibits the delegation of process governance to a central authority such as the Federal Office for Migration and Refugees (BAMF). This separation also leads to regional differences as federal laws govern the procedure’s general steps, whereas state laws govern implementation. Moreover, existing solutions for cross-organizational collaboration are limited in terms of flexibility, security, and data quality. As a result, the exchange of certain data on asylum procedures still occurs using Excel spreadsheets and e-mails.
 
(b)
Action taken: Against this backdrop, the BAMF explored technological options that would support the decentralized governance of the asylum procedure. After a preliminary evaluation, the BAMF decided to explore a solution based on blockchain technology. Building upon a successful proof of concept, the BAMF initiated a pilot project with Saxony’s central immigration authority. This project aims to develop a blockchain solution that supports the coordination of asylum procedures and can be easily adapted to local differences and functional requirements.
 
(c)
Results achieved: The use of the blockchain solution allows for efficient, secure, and timely distribution of status information. It supports communication and improves coordination between authorities. Despite an apparent conflict between blockchain principles and data privacy requirements, the BAMF’s design complies with relevant regulation (notably the GDPR). As a first-of-its-kind project, it outlines best practices and provides valuable insights into opportunities and challenges arising from the use of blockchain in the public sector.
 
(d)
Lessons learned: The BAMF’s case demonstrates that blockchain solutions can be promising alternatives when the delegation of process governance to a central party is not desirable and when federal principles of organization are to be reflected technologically. However, blockchain projects require special attention to managing know-how and capabilities, software development activities, stakeholders, the regulatory context, and cross-organizational governance.
 
Julia Amend, Christopher van Dun, Gilbert Fridgen, Franziska Köhler, Alexander Rieger, Alexander Stohr, Annette Wenninger
Breaking Down Barriers with Digital Technology: Reimagining Chronic Care by Empowering Paramedics
Abstract
(a)
Situation faced: The case company, Future Health Services (FHS), provides tele-home monitoring services to chronically ill patients in Southern Ontario. As the population continues to age, the healthcare industry is committed to leveraging technological solutions to provide care for patients in the comfort of their own home. FHS offers a program through collaboration with paramedics that aims to improve patient care at home and quality of life as well as connect patients to a broader network of care providers to appropriate care delivery according to specific patient needs. In implementing this program, paramedic services started to transform and expand their traditional operating model.
 
(b)
Action taken: FHS introduced the Community Paramedic Remote Patient Monitoring program, called CPRPM. In this model, paramedics were required to onboard patients, work with patient doctors to establish clinical thresholds, and complete work required to set up and train patients to use remote monitoring devices to manage their condition from home. Once up and running, the CPRPM system alerted paramedics daily if the patient did not take their readings or one (or more) of their readings were outside the clinical threshold. This case will cover action taken by FHS to implement the program across six paramedic communities.
 
(c)
Results achieved: Integrating the CPRPM into the care model for patients with chronic disease and leveraging community paramedics as a point of local access, the pilot program saved an estimated $4.7M ($7279/patient) to the overall health system. The program helped patients with chronic disease feel more confident staying in their home and determine when they were at risk of exacerbation, and it was appropriate to seek help (call 911). Implementation success varied across paramedic communities as some communities embraced the change and generated significant benefits for patients and the overall healthcare system, whereas others generated less significant results.
 
(d)
Lessons learned: Topping the list of lessons learned is that digital transformation is messy, complicated, and difficult. Traditional business case and implementation planning needs to be refreshed with novel approaches inherent in design thinking and systems thinking. Forming partnerships will pave the path of least resistance, but finding the right partners is critical, and they may not be the ones that come top of mind. Feedback is an important mechanism for stitching together activity across stakeholders in an ecosystem. Finally, transformation initiatives need permission to play and explore, but leadership needs to define parameters to protect their best people and mitigate longer-term risks.
 
M. Kathryn Brohman, Richard Whittaker
Enabling Digital Transformation Through Cognitive Robotic Process Automation at Deutsche Telekom Services Europe
Abstract
(a)
Situation faced: Subject of this case is Deutsche Telekom Services Europe (DTSE), a service center for administrative processes. Due to the high volume of repetitive tasks (e.g., 100k manual uploads of offer documents into SAP per year), automation was identified as an important strategic target with a high management attention and commitment. DTSE has to work with various backend application systems without any possibility to change those systems. Furthermore, the complexity of administrative processes differed. When it comes to the transfer of unstructured data (e.g., offer documents) to structured data (e.g., MS Excel files), further cognitive technologies were needed.
 
(b)
Action taken: DTSE has identified robotic process automation (RPA) as a key technology to achieve its automation targets. A dedicated Center of Excellence was founded in order to enable a company-wide automation. The whole implementation was organized in an iterative manner following a project-based approach. From a methodical perspective, the set-up and conduction of the RPA project were structured into (1) organization and governance, (2) processes, and (3) technology and operations. From the content perspective, the RPA project defined and implemented a multitude of detailed RPA use cases, whereof two concrete use cases are described.
 
(c)
Results achieved: Since the first RPA pilot implementation in Q3/2016, a total number of 172 software robots have been successfully implemented across six different functional areas within finance and controlling, procurement, and HR domains. Those implementations resulted in measurable performance improvements, such as lead time reductions, full-time equivalents (FTE) reductions, and cost savings.
 
(d)
Lessons learned: The case provides an example for a concrete technology-induced change as part of a digital transformation. The concept of cognitive RPA provides an opportunity to automate human activities through intelligent software robots. The lessons learned utilizable for future RPA projects are as follows: (1) Close alignment with functional departments is a critical factor. (2) RPA implementation requires specific solutions for each process. (3) Differentiation between software robots and RPA systems is essential. (4) RPA requires a central governance structure. (5) Pilot-driven approach for cognitive RPA is a key success factor. (6) Operating model for RPA is a prerequisite for long-term success.
 
Christian Czarnecki, Chin-Gi Hong, Manfred Schmitz, Christian Dietze

Digital Business

Frontmatter
Huawei
An Exceptional Example of Customer-Centered, Collaborative, and Decentralized Practices in the Telecommunication Industry
Abstract
(a)
Situation faced: Huawei has surpassed companies such as Ericsson, Nokia Network Solutions, and Motorola Solutions and thus became the biggest telecommunication firm in China and the third world biggest telecommunication firm right after Apple Inc. and Samsung Group. Despite the success achieved by the company today, Huawei had a humble and rigorous beginning. In order for Huawei to become a worldwide recognized company with a high reputation, the company had to overcome four main challenges: (1) country of origin, (2) liability of foreignness, (3) latecomer effects, and (4) lock-in effects.
 
(b)
Actions taken: Huawei encountered challenges such as having a negative image and reputation, developing basic ICT through reverse engineering, lacking on talented workforce, and relying on a centralized and governance structure as well as on interdepartmental activities. To become a global player and streamline the firm enterprise architecture, Huawei relied on three different strategies: (1) using operations in the periphery as a technological catch-up strategy to foster ICT-application systems by relying on business networks and customer-centered solutions, (2) creating and breaking routines to promote a decentralized and demand-driven supply structure, and (3) lowering innovation barriers throughout hiring international talent as well as relying on co-created and cross-departmental activities.
 
(c)
Results achieved: Founded in 1987 as a distributor for telephone switches, Huawei is now recognized as one of the global and digital leaders in the telecommunication industry. By relying on managerial practices such as value creation, collaboration, and decentralization, Huawei has developed capabilities in different forms such as R&D, university collaborations, development of leading-edge technologies (e.g., 5G network, digital switching technologies, enterprise networks), and strategic mergers and partnerships. These actions have led the company to fulfill its meaning by developing pioneering technologies and services and becoming a symbol of innovation, inside and outside of China.
 
(d)
Lessons learned: Today, the success of digitalization does not lie in the development of digital technologies individually. Instead, it stems from how companies integrate them to transform their businesses and how they work. In this context, the ability to digitally reimagine the business is determined in large part by having a clear strategy supported by leaders who foster a culture able to change and invent. To successfully ride the wave of change, companies need to evaluate how digital disruption is changing customer behavior continuously, rethink their business toward developing more individual and customized solutions, and redesign customers’ roles to form co-creation practices.
 
R. Guerrero, C. Lattemann, S. Michalke
Facing Digitalization in the Insurance Industry
The InsurTech Case of DEVK
Abstract
(a)
Situation faced: Given their long-established tradition and resounding success, digitalization brings unprecedented changes for insurance companies. Driven by the disruptive developments observed in comparable industries, DEVK, the company investigated in this case, realized their business model is at stake in the digital age. Due to a lack of experience with establishing and managing digital business models and an IT infrastructure and processes focusing primarily on stability and reliability instead of fostering innovation and creativity, the company faced a plethora of challenges.
 
(b)
Action taken: Responding to these challenges, DEVK made “making use of digitalization” one field of action in its new business strategy. One initiative within this field was the founding of “Freeyou”, a company-owned start-up. The name reflects the start-up’s vision, which is to make insurance as easy as possible for the customers, to free them from tedious paperwork and to give them time for other things they would rather do. Since its foundation in 2017, the InsurTech has launched two products which are equipped with digital features and that can be purchased entirely via digital channels.
 
(c)
Results achieved: Launching the products took Freeyou 4 and 8 months, respectively—an implementation period that would so far not have been feasible within the parent company. While the first product, a bike insurance, still had pilot character, Freeyou was able to achieve significant sales success with the second product, a car insurance. To implement the new business model, Freeyou has built up an organization which, unlike the parent company, is primarily focused on innovation and speed, allowing the group to quickly test new products and forms of customer interaction.
 
(d)
Lessons learned: Even though the initiative is still at an early stage and requires continuous development, the case investigated gives valuable insights for incumbent companies looking for ways to benefit from digital technologies quickly. The case has shown that for this, the underlying organizational model is at least as important as the changes required on the business model side. In order to build both on a “greenfield site,” it was “mission critical” to reduce the dependencies to the rest of the group to a minimum.
 
Sara Schiffer, Jan Stockhinger
How RAPS Spiced Up the German Butcher’s Trade
Introduction of Digital Services to a Non-Digital Industry
Abstract
(a)
Situation faced: RAPS is a German spice manufacturer offering various top quality products to customers worldwide. Organized in three business segments, RAPS supplies large companies in the food production sector, caterers and restaurants, and the butcher’s trade and food retail sector. Especially the butchers, one of the most loyal target groups of RAPS, face current challenges. Strong market consolidation due to the approaching food retail sector and increasing regulatory requirements are but a few examples. Addressing these challenges, RAPS pursued the following project mission: Leveraging digitalization’s potential to expand RAPS’ value proposition, to differentiate from competitors, and to increase market share in the butcher’s trade.
 
(b)
Action taken: In a joint project with the Project Group Business & Information Systems Engineering of the Fraunhofer FIT, RAPS devised, developed, and launched new digital services that specifically address the butcher trades’ main challenges. In a customer-centric approach, butchers were included in the entire process. Starting with the identification of challenges, they tested and evaluated concepts and prototypes in various developmental stages. The new digital services, subsumed under the platform-independent application myRAzept, now support hundreds of RAPS customers in a formerly rather non-digital industry regarding food information labeling, recipe management and planning, and order management.
 
(c)
Results achieved: The project team achieved several notable results: By providing an intuitive and useful platform-independent web application, RAPS expanded its service portfolio for an important group of customers. The image of RAPS as an innovative company was improved. The project did not only delight customers and externals stakeholders but also the employees of RAPS. Due to the project’s positive spirit, the collaboration between different parts of the company was further improved. Additionally, the project’s scope matches perfectly with the efforts of the Adalbert-Raps-Stiftung as a charitable foundation and silent partner of RAPS.
 
(d)
Lessons learned: The project revealed a variety of lessons learned that might help others when implementing digitalization projects in small- and medium-sized businesses, especially in the food industry. When introducing digital services to a traditional non-digital industry, the potential users’ digital readiness must be considered. Incumbents’ value propositions regarding quality in the physical world need to be transferred to digital services to maintain customer trust. Thereby, the integration of customers’ opinions, wishes, and requests is extremely valuable. Further, providing digital services to customers requires the development of digital capabilities within the company.
 
Karsten Glismann, Jan Jöhnk, Wolfgang Kratsch, Niclas Nüske, Fabian Schmied
Digital Transformation of the Automotive Industry Through Collaboration Hubs
The Development of Mobility X Lab to Source Startups Through Matchmaking
Abstract
(a)
Situation faced: The prospects of digitalization in the automotive industry are enormous with emerging technology concepts, such as electrification, autonomous driving, connected mobile services, and new business models. However, digital innovation has proven difficult for original equipment manufacturers (OEM) due to complex organizational structures, corporate cultures, and technological inertia associated with the automotive industry. In a recent rating of the 50 firms that best combine new technology with effective business models, only 2 were automotive companies. The obstacles to digital innovation are related to closed innovation processes and to deficient collaboration forms with external development firms, i.e., startups.
 
(b)
Action taken: To overcome these challenges, a coalition of incumbent automotive and telecommunication firms set up a joint incubator, the Mobility X Lab (MXL), to engage with startups to support internalizing external technologies. Since its inception, the incubator has gone through several development phases and is currently transforming into a collaboration hub. So far, MXL has admitted 5 batches including 40 startups. An important distinguishing characteristic of MXL is that it only admits startups with two or more coalition partners involved.
 
(c)
Results achieved: MXL started as an incubator with a mentoring-based accelerator program. As MXL has developed, it has transformed into a collaboration hub and a neutral partner for fostering startup collaboration and engagement in the automotive industry. Based on lessons learned from startup batches and partner discussions, MXL has advanced, from offering traditional mentoring support, to be a central node in the innovation ecosystem of future mobility in Sweden, thus becoming a matchmaker for startup collaboration, providing guidance and access for startups to incumbent automotive and telecommunication firms and at the same time providing the partners with access to external technology, supporting them to stay relevant.
 
(d)
Lessons learned: Through the development of MXL, a coalition of established automotive and telecommunication firms have learned to manage some of the tensions related to digital transformation of their industry. By examining the case of MXL, a number of lessons can be learned: (1) Ensure partner interest through the “two partners” criteria, (2) initial emphasis on engaging startups and less focus on a complete process, (3) announce partner needs without disclosing partner pain-points, (4) coach startups and corporate partners simultaneously, (5) manage expectations early for both startups and corporate partners, (6) develop and implement sound collaboration measures, and (7) joint headship requires a consensus-based governance model.
 
Anders Hjalmarsson Jordanius, Gustaf Juell-Skielse, Hanna Rydehell
A Two-Sided Approach for Digital Innovation at SCHOTT
Combining Resource- and Problem-Oriented Innovation Methods for Digital Service Development
Abstract
(a)
Situation faced: SCHOTT, a global player in the specialty glass and glass-ceramics industry, offers a wide variety of products, among which it’s Business Unit Tubing (SCHOTT Tubing) focuses on semi-products for various industries, e.g., pharmaceutical packaging. By enhancing the production quality with initiatives like perfeXion® and dedicated data collection throughout the whole product life cycle, SCHOTT Tubing, driven by a sense of ambition rather than a sense of urgency, strives to shape the digital transformation of its business and the entire industry. Against this backdrop, SCHOTT Tubing launched the first B2B e-commerce platform and strives to leverage this digital infrastructure for creating additional digital services. Yet, exploring innovative digital services poses a significant challenge for established businesses in the B2B context that demand sound methodological guidance.
 
(b)
Action taken: To face this challenge, SCHOTT Tubing applied a novel innovation approach that combined both problem-oriented and resource-oriented innovation approaches. This included an initial ideation phase with an international workshop format followed by a concept phase with iterative, customer-focused evaluation cycles in an interdisciplinary sprint team.
 
(c)
Results achieved: The presented case shows a target-oriented approach for incumbents to combine both problem-oriented and resource-oriented approaches to develop and evaluate digital service innovation effectively. Throughout the ideation phase, 14 SCHOTT employees developed over 50 digital service ideas. By using the introduced innovation approach, five ideas were prioritized for the concept phase. These ideas were tested and further detailed in close collaboration with SCHOTT Tubing’s customers. Besides, SCHOTT Tubing thereby enhanced knowledge of innovation methods and fostered an innovative culture among the participants.
 
(d)
Lessons learned: Beyond commonly applied approaches that solely focus on the customers’ problems, SCHOTT Tubing instead also paid attention to their resources, including customers, assets, or internal services as types of resources to drive ideas in the field of digital service innovation. In addition to the generated digital service ideas, this case provides valuable methodological insights: It reveals the strengths and weaknesses of the two-sided approach of the sequentially applied problem- and resource-oriented innovation methods.
 
Anna-Maria Oberländer, Bastian Stahl, Laura Watkowski, Sabrina Braadt, Peter Scherer
LOHMAR | DIGITAL | FOR EVERYONE
The Development Process of a Digital Transformation Strategy and Its Fields of Action in Lohmar
Abstract
(a)
Situation faced: As a city of generations and living actively in the countryside, Lohmar is a rural municipality on the outskirts of Cologne and Bonn in Germany. According to Lohmar’s slogan “Lohmar | Digital | For everyone”, Lohmar aims to actively shape its digital future. This paper is not only focusing on the development of a digital transformation strategy but also on the challenges Lohmar faces in the field of mobility. Lohmar is facing a high level of commuter traffic with only a low utilization of 1.2 persons per car, due to the car as the main transportation vehicle.
 
(b)
Action taken: To face its challenges, the city of Lohmar began developing a digital transformation strategy. With the involvement of various stakeholders, Lohmar developed its own online platform where citizens could share ideas on the digital transformation strategy and its projects. Thus, the fields of action administration, education, mobility, and entrepreneurship occurred. In the field of mobility, ideas emerged for organizing commuter traffic, with a focus on the idea of a dedicated smart mobility hub that combines multimodal mobility systems. With this idea, Lohmar responded to the smart cities call by the Federal Ministry of the Interior, for Construction and Home Affairs (BMI).
 
(c)
Results achieved: By developing a digital transformation strategy in Lohmar, the city prioritized the topic of digital transformation in all areas of its municipality. With the engagement of different stakeholders and various citizens, Lohmar succeeded to make digital transformation processes omnipresent, through implementing a change management process. In different workshops, Lohmar encouraged its citizens and employees to rethink digital transformation processes supporting ideas, especially regarding commuters’ challenges. Based on this, Lohmar was able to submit the project proposal of RBS.Mobil, multimodal mobility concept in the affluent suburbs of Cologne and Bonn creating a network for mobility, which is now being funded.
 
(d)
Lessons learned: In its process of developing an own digital transformation strategy and submitting a project proposal for a smart multimodal mobility hub with the focus on commuters’ traffic, Lohmar achieved six lessons learned, which can help municipalities facing comparable challenges (e.g., a strategic roadmap into a digital future, commuter traffic in a rural area). Lohmar’s six lessons learned are described as followed: First, digital transformation is a joint task! Second, digital transformation processes need competences! Third, digital transformation processes need responsibilities! Fourth, learn from other municipalities! Fifth, there is always more than one solution! Sixth, asking for help improves your actions!
 
Cindy Schaefer, Kristina Lemmer, Stephan Weber, Philipp Kukula, Bjoern Niehaves

Digital Transformation

Frontmatter
Approaching Digitalization at an SME Manufacturing Service Provider
Customers at the Heart of Listemann’s Digitalization Strategy
Abstract
(a)
Situation faced: Listemann Technology AG (Listemann hereafter), a leading industrial service provider for heat treatment, brazing, sintering, electron beam welding, and engineering in the manufacturing industry, invests in new digital solutions to increase the value of its services for its customers. Even though Listemann has a digital production process par excellence, its customer management relies on traditional approaches like telephone calls and emails. As its competitors are also fighting for customers and becoming digital, the importance of Listemann’s maintaining and strengthening its customer relations and using digital technologies to generate business value increases.
 
(b)
Action taken: The digitalization project was carried out in four phases, beginning with analysis of the current status and moving on to elaboration of digital potential for Listemann with a focus on processes that have a direct or indirect impact on customers, analysis of the prerequisites for the implementations, and the design and cost estimation of the new web portal and the corresponding data management solution. Several interviews and meetings with the company and external stakeholders were executed.
 
(c)
Results achieved: The preliminary results include insights Listemann’s current situation regarding customer contacts, a list of potential solutions and measures to put the customers at the heart of the company’s digitalization strategy, and the new design of a web portal with a new data management solution to improve the company’s communication and interaction with customers.
 
(d)
Lessons learned: Major lessons learned from the Listemann case provide insights for other SMEs that face the challenge of keeping up in the digital age, in particular the challenge of digitalizing their customer processes. These six lessons learned can be summarized as (1) be aware of (multiple) context(s), (2) know your customers and manage your processes accordingly, (3) define your digitalization strategy, (4) get everyone on board, (5) create incentives to support the digitalization process, and (6) establish a stepwise approach.
 
Michael Reiner Kamm, Charlotte Wehking, Lena Franziska Kaiser, Markus Otto, Jan vom Brocke
Digitalizing Water Bill Payments
Introduction of Change Management at Ghana Water Company Limited
Abstract
(a)
Situation faced: Ghana Water Company Limited (GWCL) is a public utility company undergoing a digital transformation. The company began transforming its billing processes in 2016. A vital component of the transformation agenda is the digitalization of customer payments, where customers can make water bill payments through mobile money and other digital payment platforms.
Management of the company has realized that some of its commercial department employees (customer-facing staff) are consciously or unconsciously resisting the change. Therefore, to increase adoption, and usage of the payment channels, management has decided to implement a change management program.
 
(b)
Action taken: A mixed-method approach was used to obtain staff views on the ongoing digital transformation process at GWCL. This was achieved through a survey and focus group discussions. The study targeted to collect data from 200 staff. There were 160 staff who returned completed questionnaires.
The analysed data from the survey and five focus group discussions were used to develop a digital payment change management framework incorporating implementable action points that will enhance organizational appreciation of digitizing bill collection.
 
(c)
Results achieved: The survey and focus group discussions showed that the ongoing digitization projects at GWCL have resulted in apprehension, anxiety and fear among many of the staff. Overall, the company staff understanding of change is characterized by operational practices rather than behavioural practices. The research resulted in a digital payment change management framework which has been accepted by the company senior management. The framework establishes how changes will be proposed, analysed, accepted/rejected, implemented, monitored, controlled and documented. Currently, the company has successfully implemented a series of pragmatic change initiatives using the framework to facilitate the usage of digital payments for bill collections.
 
(d)
Lessons learned: The most important lesson is that it is not possible to manage change in this public sector organization using a checklist of change management steps. The lessons learned are as follows: (1) A transparent and systematic approach to change management enhances digitalization (increases usage and adoption). (2) An iterative approach allows failure and lessons to be learned. (3) Use a context-specific change management framework to establish sustainable change. (4) Use change champions to drive change.
 
Ransford Mensah, Aileen Cater-Steel, Mark Toleman
Impact of the Digital Transformation on the Transformation of the Workforce
A Methodical Approach by the Example of the Technical Development of a German Automotive Manufacturer
Abstract
(a)
Situation faced: Traditional car manufacturers can no longer escape the pressure of digitization and automation. For the workforce, it is extremely challenging to face up to the need for the changes derived from this. These changes are induced externally, as customer needs and thus the requirements for the degree of digitization of products are changing (e.g., connected cars, automated driving functions, on-demand and sharing offers, etc.). At the same time, the pressure for change is induced internally, as employees’ needs are also changing (e.g., digital workplaces, modern IT equipment, integrated systems and processes, digital collaboration, etc.). Our approach starts here and accompanies the technical development division of an automotive manufacturer in the development of a concept for the transformation of its very own workforce.
 
(b)
Action taken: To enable the case study company to transform its workforce of the technical development division in a meaningful way, the division-specific constellation was considered. This constellation consisted of history, internal performance scopes, external performance scopes, and personnel strategy goals. Together with the relevant stakeholders (based on a stakeholder analysis), precisely fitting methodological approaches were selected (based on expert discussions) that met this specific situation. A transformation concept was developed that placed the employee at the center, provided room for individual problems and needs, and clearly relied on the participation of the workforce.
 
(c)
Results achieved: The actions taken resulted in a ground-laying understanding of what digital transformation entails specifically in this traditional organization; what needs, obstacles, and interests reside within the workforce and towards management personnel; and how these can be tackled from different angles. With this knowledge, it was subsequently possible to develop targeted measures to sensitize the workforce to the necessary digitization change and to increase its acceptance. It was possible to give the management’s quantitative transformation goals a practical relevance and to validate their feasibility.
 
(d)
Lessons learned: Implementing digital transformation measures within the case company with its traditional business models and structures was a significant challenge. The holistic approach of the present paper has shown that a step-by-step approach with compact, purposefully communicated measures can lead to the goal of sustainable workforce transformation for the digital automotive age. Despite the involvement of all relevant stakeholders and those affected, both the company’s expert team and management personnel must be prepared for delays or even failure of this transformation process at any time. At the same time, however, it was accomplished to learn and show that—contrary to expectations (and prejudices) in some parts of management—the absolute majority of those involved were ready for change.
 
Nils Schaupensteiner, Sophia González, Judith Borgmann
The Springest Story: How IT Enables Holacratic Organizations
Abstract
  • Situation faced: How to include employees in decisions? How to keep the organizational design responsive to changes in the environment? And how to support all this by means of information technology? Ruben Timmerman, the founder of Springest, asked himself these questions as his company grew from a start-up to a medium-sized platform business.
  • Action taken: Springest adopted Holacracy, a management philosophy that combines decentralized decision-making with high levels of formalization. To enable each employee to take action, Springest implemented the task management software ASANA that represents and allows modifications of the organizational structure at any point in time.
  • Results achieved: Today, ASANA plays an important role in all parts of Springest’s organizing and serves as an important tool to monitor tasks and to clarify responsibilities. Since employees record anything that is unclear or might prevent Springest from functioning in an optimal way, ASANA is also an important companion for meetings, where these action items are processed. As a result, Holacracy does not only enable Springest to react more quickly to changes in the environment, but the actions taken also result in increased workplace happiness, which is higher than in most other tech companies. In the Netherlands, Springest has received the best employer of the year award in 2015, 2016 and 2017, respectively.
  • Lessons learned: The use of information technology is key to support holacratic organizing. Only IT allows constant transparency of the organizational structure and to understand who is responsible for what. As a result, engagement in IT tools needs to be ensured and special attention should be paid to the fit of applicants with the organization.
Bastian Wurm, Reinald A. Minnaar, Jan Mendling, Matt Hallmann, Saimir Bala, Waldemar Kremser, Erik Strauss
Digital Kaizen at FPT Software: Principles and Practices for Digital Transformations
Abstract
(a)
Situation faced: While companies are leveraging technologies to improve their business performance, digital transformation is still perceived as an abstract concept. Most companies do not know where and how to start. FPT Software’s lack of synergy prevents the company from reaping the benefits of its digital transformation activities. The large-scale transformation also requires a ready-to-change culture, which can be daunting to a company with more than 28,000 employees across geographies with different technological capabilities. This chapter explores the applications of Digital Kaizen methodology in guiding FPT Software’s digital transformation journey and in helping them to commercialize their digital transformation solutions.
 
(b)
Action taken: FPT Software tackles cross-functional pain points by implementing technological initiatives that improve business processes and increase employee engagement. These initiatives are well aligned with the company’s strategic goals; thus, they are sustainable and scalable digital transformation solutions. First, cross-functional pain points are identified by both managers and working-level employees through conducting workshops. Second, a series of manageable digital transformations are performed to change business processes, the employees’ mindsets, and work processes. Last, FPT Software commercializes its own successful digital transformation initiatives and sell them as solutions to the clients. Two digital transformation projects, MyFPT and AkaLink, are presented in this chapter.
 
(c)
Results achieved: The Digital Kaizen methodology has urged FPT Software to continuously optimize and improve their business operations through implementing innovative transformations. By implementing incremental improvements, MyFPT has resolved 22 strategic pain points until June 2020. AkaLink has addressed 19 pain points, resulting in approximately USD700,000 in terms of monetary benefits. It is projected to rise to USD2.5 million after 1 year. These digital transformation projects also produced spillover effects, i.e., driving people engagement and nurturing the culture of change, which benefit the whole company. FPT Software commercializes its digital transformation solutions by using successful projects as practical case studies.
 
(d)
Lessons learned: FPT Software’s digital transformation journey offers three main lessons. First, driving digital transformation through making incremental changes enables companies to realize the benefits quickly. This subsequently motivates transformation activities at large scale across the entire organization. By selecting the cross-functional pain points that are aligned with strategic objectives, FPT Software has solved operational issues without losing sight of its long-term vision. Second, companies should improve organizational change capacity by engaging their own employees who are the drivers of digital transformations. Third, as digital transformation is an ongoing process, a philosophy-driven digital transformation, such as that guided by Digital Kaizen, would develop a climate of engagement and creativity among organizational members at all levels.
 
Duy Dang-Pham, Ai-Phuong Hoang, Diem-Trang Vo, Quang Tran Duc Tri
Cultivating Digital Transformation at Arcadis
A Global Expedition into the Digital Universe
Abstract
(a)
Situation faced: After a wake-up call by a digital native, over 130-year-old Arcadis decided that a digital transformation of the global firm offering design and consultancy in the construction industry would be necessary. Arcadis realized that its fragmented organization with different business lines, expertise areas and services for each region could not respond to changes in a turbulent environment with the same speed as a digital native. A deeply rooted organization culture would have to be disrupted, taking 27,000 Arcadians worldwide on a digital journey.
 
(b)
Action taken: Arcadis appointed a corporate digital team whose main aim was to lead an inclusive digital transformation. They took on the challenge to cultivate a common language for digital transformation and new skill sets. The centrepiece of their approach was Expedition DNA, a multitiered voluntary program that would build a foundation for involving all of the talents in the company. Alongside more technical skills development, the program, which was continuously evaluated and revised, provided people with new skill sets in their function. An internal communication plan ensured that the same common language was used consistently in all company efforts and appropriated by all digital ambassadors.
 
(c)
Results achieved: By November 2020, 2 years after the launch of the Expedition DNA program, 16,221 employees had taken the voluntary online training. By complementing Expedition DNA with other actions, and by constantly focusing on the same digital transformation tenets, Arcadis managed to spread a common language throughout the company for discussing digital transformation. Along with new digital skills, this led to new forms of client engagement and more digital business development. The cultivation of a common language and the community-building efforts had a positive impact on employee engagement, collaborations within and across regions, employee retention, and the employer brand.
 
(d)
Lessons learned: The case provides inspiration for how to make cultivation a key part of digital transformation programs: put learning and belonging centre stage in cultivation, go for an inclusive digital transformation with a layered degree of involvement, build in a community aspect, acknowledge the importance of data-based decision-making and deal with paradoxes in decision-making.
 
Lieselot Danneels, Stijn Viaene, Joachim Van den Bergh, Carolyn Moore
Becoming a Data-Driven Company
How medi Has Laid the Foundations
Abstract
(a)
Situation faced: medi, a leading provider of medical aids, is a German-based manufacturer, making it its mission to help people feel better. medi’s product portfolio includes compression, orthoses, and other medical products as well as sports and fashion products. With its impressive success and rapid growth, medi has faced the challenge of transforming itself into a digital and data-driven company. In particular, the historically grown structures in its infrastructure, data management, and missing data strategy were major obstacles to its transformation. At the same time, evolving customer demands and technological developments offered great opportunities to differentiate and optimize.
 
(b)
Action taken: In an effort to become a data-driven organization for better use of data for evidence-based management decisions, medi, in close cooperation with the Project Group Business & Information Systems Engineering of the Fraunhofer FIT, conducted a thorough analysis of the existing process and application landscape as well as its data management. In-depth interviews with internal and external experts, as well as a detailed analysis of existing systems, revealed the status quo and provided the basis for analyzing future development paths. medi used these findings to prioritize existing digital transformation (DT) projects, to identify new data-based services, and to improve internal processes and services.
 
(c)
Results achieved: The approach adopted by medi lays the fundament for becoming a data-driven organization and, thus, delivered two major contributions: First, by unveiling the process and application landscapes and the currently existing data logic, medi identified starting points for future development, such as current redundancies and weaknesses. This transparency forms a solid foundation for medi’s digital initiatives and development of a data strategy. Second, through a series of in-depth interviews, medi collected and prioritized important ideas and expectations for numerous exploitation and exploration projects as inputs for its data-related understanding, as an organization and at the individual level, as well as for its data strategy conception.
 
(d)
Lessons learned: In all divisions involved, medi’s project approach has led to a better understanding of the need for a uniform data structure, which in turn leads to a better match between management expectations and operational feasibility. In addition, the documented processes, application landscapes, and data logic act as a common foundation for the development of project roadmaps, enabling higher effectiveness and efficiency in business operations. As a result, medi has particularly benefited from a common understanding of what being a data-driven company means, which prerequisites need to be fulfilled, and which roles are involved in the management and usage of data.
 
Christoph Buck, Christopher van Dun, Rocco Huber, Jan Jöhnk, Markus Birkel
Governance for a Multinational ERP Program in a Decentralized Organization
How Arbonia Doors Set up a “Glocal” Governance Enabling Both Local Differentiation and Global Consistency
Abstract
(a)
Situation faced: In 2019, Arbonia Doors, the door division of Arbonia Group (a multinational building supplier corporation), decided to implement SAP S4/HANA to realize global harmonization and integration across four highly autonomous local subsidiaries. In the early phase of the program, it became clear the program can only succeed if the gaps that exist between the aims of the four local subsidiaries and the aims at the division level can be bridged or even closed. This called for governance measures that address the tensions evoked by a decentralized organizational context.
 
(b)
Action taken: Armed with an understanding of governance as a means of control and coordination to deal with contrasting objectives within a program, the program manager and program sponsors decided that the identified tensions should be tackled through a set of appropriate governance measures. From the outset of the ERP program, Arbonia Doors set out to design, implement, and evaluate nine “glocal” governance measures ranging from program structures to community building measures.
 
(c)
Results achieved: Through the “glocal” governance measures, Arbonia Doors enabled both local differentiation and global consistency. Not only was it possible to define a consensual degree of process harmonization, but a boundary-spanning sense of community and collaboration was also established. This is expected to be valuable for future digital transformation programs in the group.
 
(d)
Lessons learned: A joint reflection with the program team on the designed “glocal” governance framework resulted in seven lessons learned that promise to be projectable to digital transformation programs in general: (1) Continuously frame an ERP endeavor as a major step in the digital transformation journey rather than as a large, complex IT program. (2) Actively strengthen the understanding and handling of tensions as a both-and rather than an either-or decision. (3) Start early and allow developing of governance measures by trial and error. (4) Foster co-creation of governance. (5) Cover formal as well as informal governance mechanisms. (6) Develop a clear strategy on how to include external partners. (7) Systematically demonstrate the effects of governance measures.
 
Caroline Kiselev, Patrick Langenegger
Metadata
Title
Digitalization Cases Vol. 2
Editors
Nils Urbach
Maximilian Röglinger
Karlheinz Kautz
Rose Alinda Alias
Carol Saunders
Martin Wiener
Copyright Year
2021
Publisher
Springer International Publishing
Electronic ISBN
978-3-030-80003-1
Print ISBN
978-3-030-80002-4
DOI
https://doi.org/10.1007/978-3-030-80003-1

Premium Partner

    Image Credits