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Abhinav Thyssenkrupp

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Abhinav Thyssenkrupp

  1. 1. Crafting a Winning Digital Strategy World Forum Disrupt Abhinav Singhal 22 November 2018, Singapore
  2. 2. 2 2 We are a diversified industrial group with presence in 79 countries ~ €41.5 billion sales, 159,000 employees &
  3. 3. 3 Gartner 2018 CEO and Senior Business Executive Survey comprises of 460 business leaders in organizations with more than $50 million in annual revenue qualified and surveyed; EY Center for Board Matters supports boards and committee members in their oversight roles; PwC’s 18th Global Annual CEO Survey interviewed 1,322 CEOs in 77 countries CXOs have digitalization as top priority Opportunity to create significant value from digital initiatives % improvement Profit margin 24 15 2017 1.6x 2020 25 16 20202017 1.5x Customer loyalty/retention The impact from digital transformations to contribute >1 trillion USD by 2021 2018 CEO and Senior Business Executive Survey: 62% of CEOs have a management initiative or transformation program to make their business more digital EY Center for Board Matters: Top priority for 2018 is understanding technology’s impact on strategy, business models and cybersecurity 18th Global Annual CEO Survey: 86% of CEOs think it’s important that they champion the use of digital technologies themselves We all agree digitalization is important…
  4. 4. 4 Only 5% of digital transformations are fully successful Only ~30% investments deliver expected returns Achieved or exceeded expectations Failed to deliver, producing less than 50% of the expected results Settled for dilution of value and mediocre performance Total Investment in digital transformations in 2018 1,300 USD billion Returns in line with expectations 400 USD billion Returns not as expected 900 USD billion Source: Bain risk history survey, Forbes …however, only very few companies realize expected benefits
  5. 5. 5 So, what is the recipe for a successful digital transformation?
  6. 6. 6 We underwent a major digital transformation
  7. 7. 7 Sources: MIT Technology Review, TIME Magazine, Harvard Business Review Smartest Companies 50 Best Innovations 25 Most successful transformations10 MIT Technology Review TIME Magazine Harvard Business Review And we have been widely recognized for our efforts thyssenkrupp is the only industrial company in these rankings
  8. 8. 8 1. Awareness 2. Engagement 3. Focus 4. Commitment 5. Agility Building a common under- standing of digitalization within the organization Mobilizing the organization and generating ideas for potential use cases Defining clear vision and priorities for the digitalization effort Re-aligning priorities based on customer feedback and market developments Scaling up pilots and defining the operating model, resources and governance for execution In our experience, there are five ingredients for a successful digital transformation
  9. 9. 9 WHY IS IT CRITICAL? WHAT’S SUCCESS? • Different level of awareness and beliefs on digitalization potential • Hundreds of jargons and frameworks available • Lack of common understanding within organization • Common language for understanding digitalization • Events/forums/resources focused on building capability • Digitalization a ‘top leadership team’ priority “Lacking a clear definition, companies struggle to connect digital strategy with day to day business” Awareness1
  10. 10. 10 Awareness1
  11. 11. 11 WHY IS IT CRITICAL? WHAT’S SUCCESS? • Need to change mindsets and build commitment • Frontline critical source of idea generation and use case identification • Identify and reach out to next gen talent within the organization • Secure organization commitment to digitalization • Build a strong pipeline of ideas/initiatives • Tap into both internal and external talent available “Changing mindsets is the single biggest obstacle for digital transformation” Engagement2
  12. 12. 12 Engagement2
  13. 13. 13 WHY IS IT CRITICAL? WHAT’S SUCCESS? • Significant investments required with low short term pay-offs • Limited resources and management bandwidth available • Need alignment across different stakeholders • Critical to generate ‘success stories’ to maintain momentum • Digital strategy integrated with overall corporate strategy • Ambitious targets with clear articulation of ‘where to play’, ‘how to play’ and ‘how to win’ • Decision on In-house vs Out-source “Strategy is all about defining what NOT to do” Focus3
  14. 14. 14 Focus3 CUSTOMER VALUE ADD
  15. 15. 15 Augmented Reality Industrial IIoTIndustry 4.0 What we offer Quality metals & plastics dispatched same day. Internet Business Industry 4.0Digital TWIN Virtual Reality Autonomous Driving Predictive Analytics Predictive Analytics Human-robot collaboration Predictive Analytics Mechatronic systems Mechatronic systems Agile Industrial Data Space Focus3
  16. 16. 16 WHY IS IT CRITICAL? WHAT’S SUCCESS? • Design choices on operating model (embedded vs stand alone) • Sequencing of initiatives and resource commitment • Need to leaner governance and review mechanisms • Digitalization part of Board agenda • Well-defined operating model with resources and budget in place • Clear accountability with KPIs and decision gates exist • Successful pilot to commercialization “Its not about one single idea, but solving 1000 small problems together” Commitment4
  17. 17. 17 ENABLING IT INFRASTRUCTURE Commitment4
  18. 18. 18 WHY IS IT CRITICAL? WHAT’S SUCCESS? • Rapidly changing technology landscape • Need faster time to market • Incorporate customer and market feedback • Regular review of digitalization priorities and focus initiatives • MVP, design thinking or similar process in place to accelerate time to market • Feedback mechanism in place to truly evaluate success “In the new world, its no more about big fish eating small fish – but the fast fish eating the slow fish” Agility5
  19. 19. 19 Lessons LearntSCRUM workshops Minimum Viable Product Agility5
  20. 20. 20 1. Awareness 2. Engagement 3. Focus 4. Commitment 5. Agility Is there a common understanding of digitalization within the organization? Are the employees committed and actively contribute to the digitalization initiatives? Is there a clear understanding of why and how will the organization create value from digitalization efforts? Are digitalization priorities regularly re-aligned in line with customer and market needs? Are the required resources, governance mechanisms and operating model in place? Recap: Five ingredients for a successful digital transformation
  21. 21. “The only wrong move when it comes to Digital Transformation is not to make any move at all” Didier Bonnet, SVP, Capegemini
  22. 22. THANK YOU

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