The digitalisation that took place in the second half of the last century was quite clear. Watches disappeared hands and gears and added batteries. When films started to be digitised, perhaps everyone understood that film material was not forever and that storing data on storage media was a great way to preserve and work with it. “Today, digitization is far more fundamental. Every day we hear about the digital revolution, yet few people really know where and how it is actually happening,” says Petr Mýtina, head of Ness Digital Engineering for the Czech Republic & Slovakia, in an interview.
Do you agree with the comparison of the ongoing digitalization to the next industrial revolution?
“There is no doubt that technology is bringing fundamental changes to the lives of companies and society as a whole. It is changing entire industries and everyone’s life. I recently read about a global financial group that describes itself as a ‘technology company in the financial services industry.’ That is very apt! And it doesn’t just apply to banks or insurance companies. However, I see the word revolution as a dramatic and one-off change. Technological innovation does bring revolutionary changes, but I would rather call it a never-ending digital transformation.”
So, what is its specific content?
“This is a very broad topic, which also differs for each industry and company. For us, it is essential to understand the customer’s situation in the context of their industry, strategy, and individual needs. Only then do we propose an appropriate solution. Offering them technological innovations just because they are trendy, and everyone is talking about them is nonsense.
We can afford this comprehensive and individual approach because we not only have experts with knowledge of the most innovative technologies, but also years of experience with our customers’ systems and business. In the context of digital transformation, we are primarily talking about new customer-oriented technologies, new products and services that generate additional revenue streams, and the use of data and data analytics for decision-making. This is correct and logical. We are also working with our customers to build new portals and self-service zones, to unify and modernize their business channels and customer platforms. But we need to see beyond that.
In the area of digitalization of products and services, I find the story of our customer, who manufactures very complex engineering units, amazing and iconic. In them, he has gradually added sensors, electronics, control and autonomous control systems. But then came the really transformational idea of selling not just engineering equipment, but a whole new concept of ‘machine as a service.'”
BUT THEN CAME THE TRULY TRANSFORMATIONAL IDEA OF SELLING NOT JUST ENGINEERING EQUIPMENT, BUT A WHOLE NEW CONCEPT OF “MACHINE AS A SERVICE.”
“Together, we have developed and are expanding a platform that collects all the data from control systems in real-time, monitors everything, analyzes it, and compares it to hundreds of similar devices. On top of this platform, we then build a series of applications that provide invaluable and previously unthinkable information and services in the areas of improved planning, management and optimization of plant-wide operations, data analytics, and predictive maintenance. And this is no longer just about the technology used, but more importantly, a whole new competitive advantage and a new source of revenue from these services, a new business model.”
Customer orientation, digitalization of products and services is just the tip of the iceberg.
“It’s only the surface, albeit the priority part of the transformation—the front-end of the business. The best customer application, new service or product will not reach its true potential if the company cannot process it properly in its internal organization and information systems, the so-called back end.
More and more of our customers are realizing this and leading analyst firms are confirming it. Gartner has come up with a multi-speed IT model that highlights the conflict between the agility of modern front-end applications and the stability of robust internal information systems. These, by their very nature and technical obsolescence, cannot adapt quickly enough to new changes.”
Does this mean that companies will have to get rid of these older technologies?
“All technologies used today have their place. Our customers have invested enormous resources and effort in their backbone systems. They may be less flexible, but without their stability and reliability, large companies could not function. Replacing them is usually an expensive, risky and multi-year process. And even a system upgraded in this way won’t be truly agile because it will again be robust and reliable to meet safety and regulatory requirements.”
So how do you want to solve this dilemma?
“There is no one answer. The really outdated and unprofitable ones have to be replaced. Significant increases in flexibility and speed of change can be achieved by improving the engineering processes for supporting and developing these platforms, automating testing or deploying changes into service. We have several global and local competence centres that are intensively working on these topics.
However, a comprehensive, holistic approach is the key answer. Leverage these platforms for their stability, robustness, and security. Simplify them where possible or migrate functions that are subject to frequent change from them to the process integration layer. That’s why we want to be the strategic end-to-end partner that helps companies connect the world of technological innovation and rapidly changing requirements with the ever necessary and necessary world of stable and reliable internal systems.”
The emphasis on employees is evident in your solutions and services. Is this due to the lack of skilled labor in the Czech Republic?
“It’s not the only reason. Employees also want to enjoy their work, take advantage of technological innovations, and look forward to making their work efficient and enjoyable. This then translates positively to their relationship with their customers. Motivated, efficient employees and digitized internal processes are just as important a part of digital transformation as customer focus… But we’ve already talked about that. And it’s confirmed by research from analyst firm Forrester, which predicts a significant shift in investment from digitizing customer technologies to digitizing internal processes and systems.”
You keep mentioning processes. So, what do you recommend to companies that are holding back?
“Companies simply work through processes. Their flexibility is key to digital transformation. Especially if they are to respond flexibly to changing market conditions, customer demands or new technological opportunities. While stable processes use new technological possibilities in their automation and robotization, agile processes need to be approached differently.
We are building our offering on a new generation of agile process platforms, such as ServiceNow, that allow us to pull the necessary part of the logic of these processes out of those large transactional systems and into a separate flexible layer. Within it, processes can then be quickly scaled while being fully integrated. That is, I think, a good way to go.”
How does technology affect corporate strategies?
“Technology unlocks the potential to do things better. They are a trigger or a means of change. But digital transformation is far from just about technology. Entire industries are changing, new companies and business models are emerging, and traditional products and services are becoming digital.”
How do you think digital transformation will evolve?
“The digital transformation will continue, and further innovations will come at an ever-faster pace. Companies will have to adapt to this, becoming agile by nature. The transformation will involve the whole company, including a permanent change in mindset, approach, culture, and management. We refer to this as ‘end-to-end transformation’ and see it as an opportunity.”
Source: euro, Mladá fronta a.s.