Jul 5, 2021 2:26:04 PM
General Manager, Sweden
As Head of Digitalisation at Stora Enso, David Blomquist is leading the strategic alignment, execution and enablement of digital business and digitalisation. He has extensive know-how in the field of strategic change management and, with 20 years of experience in advancing business by digitalisation, he’s well versed in bridging the gap between IT and sales.
Interviewee: Stora Enso | David Blomquist, Head of Digitalisation
David: Industrial giants, like Stora Enso, need to embrace the idea of failing fast and avoid engaging in mammoth projects. The major business benefit for already-existing businesses lies within a data-driven approach and by delivering proofs-of-concept (POCs).
Industrial companies are used to spending 90% of their time coming up with a product or service and then only 10% of the effort on launching and selling it. In the new era of digitalisation, you should follow the Pareto principle: Spend 20% of your time defining and verifying the value of a new product, service or solution, engaging in the POC phase. Then spend the remaining 80% on getting it launched into the market, continuous maintenance, adaptation, integration, globalisation for new market entries and so on.
David: They need to have a culture that allows for exploration. Exploration of customer needs and pains. The only way to know which services, products or innovations an industrial giant like Stora Enso can get through the toll gates, without being overrun by start-ups, is by having a culture that embraces the double diamond and a POC approach. They need this to create the opportunity of having a vast amount of verification of value and exploration through POCs. Then learning from the experiments and failing fast to accelerate business.
David: Industrial organisations easily fall into the trap of undertaking large projects to progress their business. They spend years in the first phase of new product development, defining the product or solution before trialling it in the market. At the same time, they expect their organisation to take on these projects while still managing their ongoing legacy systems, products, and operations.
In the new era of digitalisation, the focus is on fast delivery, spending a maximum of three months on defining and verifying the value of a new product or service. When the POC is established, you deploy high-performance teams to successfully do the remaining 80% in getting the product or service into the market, continuously developing and adapting it.
You cannot use the old legacy of an already-existing organisation to manage a new vertical. You must deploy dedicated teams and allow them to focus on scaling up and growth hacking and lead the break-through of the new business. Having an organisation that enables this and a culture that embraces these ways of working is key to growing and thriving in this innovative digital era of advancing online sales and businesses.
David: One of the key business opportunities for existing businesses lies within a more data-driven approach. Today, most established companies have vast amounts of data. However, they are aggregated in legacy systems which makes maintenance and development very difficult. These systems become huge bottlenecks. As Gartner indicates; in 2025, 67-70% of the work of any given company will be integration work, connecting relevant systems together, to get a single source of truth for the data.
Companies need to start extracting data from the old legacy ERP systems and aggregating it into a cloud environment. Once the data is in new data lakes, companies can start putting enablement platforms on top of this. By deploying enablement platforms (like Microsoft or Salesforce) we can then employ commodity applications that others have developed and validated before us; there is no reason to re-invent the wheel.
There is a huge opportunity here for companies not only to utilise their vast data pools but to also utilise the competence, know-how and efficiency that comes with already-existing SaaS solutions and specialised consultancies. You are enabling your business and opening the toll gates to the market by putting digitally-driven data streams into new SaaS solutions and developing bespoke solutions into their framework where needed. There is no reason to build new custom solutions with internal development teams that are still stuck managing and maintaining legacy ERP systems.
Large companies have advantages in funding, legal resources, branding and marketing capabilities to unlock and enable success. What’s most lacking is dedicated teams and agile ways of working to enable the development of new digital services. This is where the benefit of established development networks of consultancies should be utilised.
David: By having data in cloud and having an enablement platform in place you could engage with external partners to map out the solutions and ways of working to prime the organisation to receive digitally advanced solutions. The business needs should, of course, be anchored with each and every business stakeholder, division, unit or function. But for the actual implementation, companies could and should scale with external consultant pools and once the solution is established bring it to the business and educate users.
I think it is important to recognise that by engaging with consultants’ new, horizontal ways of working, companies can mature and educate the existing business with new ways of driving business that scales and accelerates digital sales. Implementing new applications, solutions and services, and ways of working, truly accelerates the ecommerce capabilities of industrial giants.
Digital innovation does not happen in isolation – engage the partner and network effect!
This blog post is part of the Digital Sales Handbook for leaders in IT. The Handbook is a crystallisation of the key themes leaders in IT need to understand in 2021 to push their digital-enabled sales forward. The book includes interviews with industry experts from companies including Stora Enso, SAS, UPM and Tiger of Sweden. Learn how your IT can become an active driver for digital sales!
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