If you belong to the first category of the curious and want to be involved from the beginning, stay tuned! Just for you is the following summary of the series “The business world in constant change, even outside technologies!” and the trailer for the new season.
At the end of the 1980s, my home region, the Ruhr, was still characterized by the extraction and processing of raw materials. When you thought of the Ruhr, you thought of smoking chimneys and black-colored house facades. There were still classic working-class neighborhoods, surrounded by mining and steel. These areas were not really popular. Access to the water was reserved for big industry. At that time, it was still unimaginable that consulting and IT companies would make themselves comfortable on rivers to offer their employees a scenic environment and create a good working atmosphere.
Now I live at the “Bonner Bogen” and often go for walks along the banks of the Rhine there. Characterized by modern office buildings, high-end hotels and sophisticated gastronomy, the sight of the neighborhood always reminds me of the utopias we used to imagine. Utopias that we imagined when we discussed the necessary transformation from an industrial to a service society.
Scenario 1: Utopia come true – The Bonn Arch on the banks of the Rhine
What utopias could we set up today? What will the working world of tomorrow look like? What can we look forward to? Questions that moved me to broadcast the trailer of the new season. Use the trailer as an additional orientation aid to align fundamental and strategically important measures early enough, future-oriented.
What happened so far!
Season 1 – “Made in Germany”, the German seal of quality for industrialization
The raw materials industry was characterized by hard work. I myself was one of the last to mine coal 1,000 meters underground. But they worked harder and cheaper abroad, so we were no longer competitive for a long time. Artificially kept alive by subsidies, the era was drawing to a close.
It was the manufacturing industry that took center stage. At the time, it formed the pinnacle of value creation and was able to determine it. For a long time, we were able to score in the manufacturing sectors and be the benchmark for quality worldwide. German technology and products were in demand and “Made in Germany” was an absolute seal of quality without equal. Having been involved from the very beginning, we were able to trump with 100 years of constantly optimized, refined, sophisticated know-how. Everything was designed with this in mind. The school system, the courses of study and also the role models in industry.
Season 2 – WWW and the world moved closer together
Then came the World Wide Web and the world moved closer together. Above all, the customers became more and more the center of attention. Mass products with a long service life were no longer satisfactory. The worldwide offer was too large to wait 10 years for the next model. Demands became more and more extensive and individualized, and had to be satisfied in ever shorter cycles. New challenges for the industry resulted in a number of changes.
Automation became more and more important to optimize work processes. First workers with simple jobs, then skilled workers with demanding jobs were replaced by machines and robots. If this was not enough to drive down the price, the company was happy to relocate the entire production abroad. Production itself was no longer the driving factor for success, but the underlying engineering. This had to be promoted and protected.
However, low-cost production was by no means enough. The products had to be individualized and comprehensive. The credo was to meet every taste and requirement at an affordable price. This forced many companies to focus on their own core competencies and, with the help of contributors, to meet the demands for scope and complexity. This circumstance fundamentally changed value creation. Process chains were parallelized, supplier companies became partners, and discarded competencies were replaced by cooperative ventures. There was no longer any question of a value chain. It grew into a complex value network dominated by industries.
Season 3 – Industry 4.0, the new expression of digital complexity
This new complexity of value creation increasingly brought technical progress in the area of IT to the fore. The optimization of internal parallelized processes, the individualization of mass production, and the increase in interoperability in the value creation network could only be realized sustainably through digitization. Since this was mostly not part of the companies’ competencies, the importance of software providers and developers as well as consultants increased immensely. A nice place on the Rhine was secured for the software companies.
However, the technical progress in IT also led to the fact that more and more services could be mapped digitally and successfully replace them. New business models emerged and took the lead in value creation. Amazon, Apple and Co. displaced companies such as General Elektric, Siemens or Volkswagen AG from the top of the world in terms of market capitalization. Increasingly extensive and complex digital services reduced the manufacturing industry to the workbench of the new big players. eBusiness outstripped traditional business.
Trailer for the new season!
Season 4 – Data, data, data. The raw material of future value creation
Of course, production must continue. Of course, services also have their rightful place in value creation. The development rather describes the change in the top of value creation. The top of capital, where products and services experience the most value. The place at the top of value creation that is being reallocated and eclipsing all other areas. The age of dataization is in full swing. If companies want to be at the top of their game in the future, they must be able to generate and own data, master it and transform it into data-driven business models. DataBusiness is the next logical step after the success of eBusiness.
Scenario 2: After digitization comes dataization and data business takes the lead in value creation
What remains for us is creativity. The performance that will make the difference in the future.
As mentioned at the beginning, technological progress primarily influences work values, customer expectations, and value creation. Data-driven business models in the area of deep and mashine learning and artificial intelligence are increasingly challenging human expertise. Now, it can already be proven in many areas that AI solutions make much better decisions than the respective experts. Today, technical algorithms already diagnose lung cancer or strokes based on CT scans just as well as medical specialists. Unlike doctors, however, they only need a fraction of a second and can be used on the move almost anywhere at low cost. Therefore, the human contribution to the company’s success will increasingly focus on creativity. The human performance that can still create added value and make the difference in the future. Theodor Heuss had already surmised in the fifties: “One day, machines may be able to think, but they will never have imagination,” although I would not sign the “never”.
Scenario 3: The change in work values in the course of technological progress calls for a new focus
Customer expectations will also change in the long term and will be geared to what is technically feasible. Personalized advertising and automated suggestions are already commonplace. Companies at the cutting edge know their target group very well based on data. Knowing the current wishes and ideas of potential customers well, as well as reacting agilely to change requests, will soon no longer be enough. More and more companies will be able to derive the future expectations of customers better and better on the basis of data. With the help of reliable forecasts, companies will be able to act at an early stage instead of just reacting.
Having arrived at the center, the target group is moving more and more into the foreground. The clientele of the future no longer needs to be oriented to existing industries. When it comes to his mobility, for example, he wants to get from A to B in the best possible way that suits his needs, without having to go to the trouble of combining the journey with the various means of transport himself. When it comes to health, the customer of tomorrow is just as interested in hospital services as he is in preventive measures such as sports and nutrition. The expected holistic view of the needs of the clientele can be extended and applied at will to other key topics such as education, care or beauty.
Collaboration in the future will be cross-industry.
But the development of holistic solutions requires a different way of creating value. Replacing combustion engines with e-cars, for example, will not take us one step further. That’s why city governments, public transportation companies, energy utilities, automakers, startups and IT companies are already joining forces to develop mobility concepts for tomorrow. In this way, more and more hubs are emerging, focused on specific topics and across different sectors. Hubs that give the companies involved the opportunity to come together at eye level to jointly develop the solutions of tomorrow. This requires an expanded network as well as a large portion of the ability to cooperate, even with participants from outside the industry. Figuratively speaking, value creation evolves into a cross-industry, neural network with topic-specific nodes, here called value creation hubs.
Scenario 4: The changed picture of value creation requires a large portion of cooperation capability, even outside the company’s own sector
We achieve a happy ending at the next season mainly through the rule of data and 3 basic alignments:
- Instigate, nurture and embed creativity throughout the organization to make a difference.
- Record, track and predict customer expectations in order to act more instead of just reacting.
- Strongly develop the ability to cooperate outside of one’s own industry in order to implement holistic solution approaches.