Digitization: Changing Thinking before Changing Things

Many people might not want to admit it, but digital transformation goes far beyond automation and process optimization. Overarching change is imminent. A comprehensive change management system is the ideal solution for achieving a maximum of success.

The hot topics for 2019 are undoubtedly digitalization and digital transformation. And it is going to stay that way for much longer. For many companies, however, the issue of digitalization and digital transformation is limited to the optimization and automation of production systems. But that is not really something new. After all, that is what IT has been about for a long time now. Today, people are looking hard for analog processes that can be taken digital without having to be directly linked to dedicated-purpose optimization of processes. Part of digital transformation is thinking about a company’s processes per se and considering where and how to use new technologies to rethink the actions, structures, processes and business model of the company.

For ERP providers, software developers, IT service providers, and consulting firms, digital transformation is creating new kinds of jobs to be done and challenges to be met. These days, IT partners must support their clients in two ways. First, they must provide modern, sophisticated information technology tools so that their clients can be among the  leaders in their industry. Second, there is a considerable need for them to provide consulting services. For example, Gartner has announced the beginning of postmodern ERP, which is like the end of traditional ERP systems. It is well known that the acquisition costs of these traditional ERP systems are high and that they are often inflexible in terms of operation. Moreover, the many adaptations they require may mean that their ability to be updated is compromised. Even though there will still be traditional on-premise ERP systems, many other systems such as HR, CRM and marketing systems will be connected to them. Taken together, digitalization and digital transformation constitute a highly complex project that requires not only exceptional IT expertise, but also new and innovative entrepreneurial ways of thinking.

To move forward in these areas, companies have to make decisions about how they should be approached as an organization. Does the company want to be a trailblazer or want to wait and see what might become important in the future? And then there are some companies that hope that the changes will not occur at all. Things will be tough for that kind of company, though. Although efficiency and productivity are already part of the DNA of Germany’s Mittelstand, our group of medium-sized companies, there is still great potential to be tapped by going digital. However, for this to come about an overarching process of change is necessary. In the digital future, when companies say something like "this is the way we have always done things" they will be pronouncing a death sentence. Getting competent consulting on developing a holistic IT strategy will be an essential step to securing a company’s existence and guaranteeing its future - the sooner the better.

Today, Microsoft Office 365 is more than just Word, Excel and PowerPoint. It is real business software, and we at COSMO CONSULT have extended it with special industry solutions and several other add-on solutions, in order to increase the utility of the software. But even with excellent information technology tools, digital transformation can never be implemented in a kind of big bang. Many companies initially limit themselves to modernizing their existing IT systems or introducing new digital technologies to achieve process optimization. But enterprise software has a limited life-cycle, so that software is quickly no longer able to meet current requirements without being continuously updated. Eventually the software dies - in the worst case with the company. So in this area the best thing is to get consulting services from a company with a corresponding IT background and technical expertise like COSMO CONSULT. This facilitates the creation of modern IT structures and the establishment of future-proof digital platforms, for example in industry, services or e-commerce. 

Corporate culture is another important component: Using the technologies that are available today, how can companies create a digital mindset? And how can they deal with the new technologies? How can they encourage collaboration and how can they take advantage of knowledge transfer? To tackle the issue of agility you also need a digital mindset: How can I react to new trends more quickly? When I purchase a software program, it will always be as old as it was the day I bought it. In the cloud, on the other hand, that software is continuously updated. If the rate of change is very high, the question has to be answered as to whether getting an update every two or three years will suffice or whether it is better to always be up to date. After all, in business only one company wins, the one that gets the contract.

At COSMO CONSULT, our experience puts us in a position to talk about issues involving corporate culture, because we are our own best customer. For the last one and a half years we have been working on implementing a major transformation project in-house, a project in which we are investing a great deal of time. This includes not only technology, but also many issues involving mindset and culture. We want to be pioneers in this area. On the one hand we want to be among the leaders ourselves, but we also want to gain experience to pass on to our clients. We want to help our clients emerge from digital transformation as winners. Among other things, we have to provide a service that translates the very technological and sometimes abstract ideas into real advantages. That is why we have built a Digital Business Consulting team to help our clients deal with this issue more holistically. We do more than just ERP. We offer the entire suite of cloud services, including data services, artificial intelligence, IoT, modern work place services and collaboration tools as well as support with traditional topics such as ERP and CRM. We have the necessary all-round competence to be consultants and to accompany them into their digital future. Because digital transformation means changing thinking before changing things.

The Article was published in the German book "Handbuch Digitalisierung" (Manual Digitization)