Leading Digital Business Transformation 50th Edition

Leading Digital Business Transformation 50 th Ed.

“The pace of digital transformation is not about to slow down, but the fundamentals remain the same. For businesses to successfully transform, it will take leaders who continually assess their transformation strategies and frameworks to understand and respond to digital disruption effectively.”

Michael Wade Professor of Innovation and Strategy and Director of the IMD Global Center for Digital Business Transformation Amit Joshi Professor of AI, Analytics, and Marketing Strategy Misiek Piskorski Professor of Digital Strategy, Analytics, and Innovation, and Dean of IMD Asia and Oceania

Leading Digital Business Transformation

Table of contents

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Leading Digital Business Transformation

Foreword

Looking back on digital transformation 2015-2022 Alumni stories • ‘They refer to me as The Transformer: I set change in motion, and I put things in order when they are not’ Giulio Vannini • Enabling a data-driven culture of customer centricity at Porsche AG Klaus Ullrich • ‘But what is digital transformation?’ Vera Steullet • ‘Tech is just the enabler’ Pere Nebot • Hyperawareness is key to success in the digital era Carlos Bártolo • Using digital to enable EnBW’s sustainable future Sven Meier Research output 2015–2023

The future of digital

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Leading Digital Business Transformation

Celebrating the 50 th edition of Leading Digital Business Transformation

Michael Wade Professor of Innovation and Strategy and Director of the IMD Global Center for Digital Business Transformation

Amit Joshi Professor of AI, Analytics, and Marketing Strategy

Misiek Piskorski Professor of Digital Strategy, Analytics, and Innovation and Dean of IMD Asia and Oceania

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Leading Digital Business Transformation

It has been eight years since we hosted the first edition of the Leading Digital Business Transformation program. Today it is Europe’s largest and most established executive program focused on digital transformation. “

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Leading Digital Business Transformation

The launch of the Leading Digital Business Transformation program came in 2015, not long after IMD’s establishment of the Global Center for Digital Business Transformation–a pioneer in best practice research on this topic. At the time digital transformation was not mainstream. Yes, companies were talking about it, but very few were doing it. To be honest, we weren’t sure if anyone would even show up. However, we found out very quickly that there was high demand–so much so that we ran the program twice in 2015, once in Lausanne and later that year in Singapore. Over the years it has continued to expand, and today we run up to eight Leading Digital Business Transformation programs a year in three locations: Lausanne, Dubai, and Singapore. What was important from the outset was that this program was about leading digital business transformations. The use of the words ‘business’ and ‘leading’ differentiate IMD’s program from some of the more technology-focused programs on offer. Of course, technology is behind everything. Much of the disruption we see today is driven by new technologies, and most modern solutions to the challenges we face are built around the same. However, the fundamental point is that the business, and not the technology on offer, has to be the focus of the transformation. From the outset we wanted it to be clear that this program was aimed at business leaders, and this is who the program has attracted. Of the more than 1,700 people that have attended one of our Leading Digital Business Transformation programs so far, more than 100 have been CEOs. We also have had a number of other C-suite executives in attendance, including many CDOs and CIOs, as well as general managers in both functional and commercial roles, each interested in how digital tools and technologies can impact their businesses. The program has enjoyed A focus on leading digital business transformation

wide appeal, attracting participants from across sectors, with most coming from the financial services, business services, manufacturing, consumer goods, and healthcare sectors.

Creating a roadmap for transformation

What do we hope participants will gain from attending this program?

When it comes to technology-related topics, buzzwords are always an issue. For us, an important starting point has always been to define exactly what digital transformation is– and what it’s not. Ultimately though, we want participants to come away being able to answer these important questions. The first question is: why do you need to transform? Is your business facing an opportunity or a threat? It is essential that you are clear of the need for transformation before you embark on any digital transformation journey. Then we ask participants to consider how their businesses can respond to disruption and how it can be an opportunity for value creation. They are given the chance to consider what strategic options they have at their disposal to respond to disruption and to ascertain whether these should be defensive or offensive. And finally, we look to answer the question: how do you transform a business? We have clearly defined frameworks for that. By the time participants leave the program, they have in their hands a comprehensive roadmap to guide their digital business transformation process.

What makes this program relevant?

When we started out on this journey we could not have anticipated just how successful the Leading Digital Business Transformation program would be. This is partly a result of good timing. We got in early, and we were ahead of

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Challenges to leading successful digital business transformations

the game. This helped generate buzz around the course, and we benefited from many word of-mouth recommendations. When we ask participants if the Leading Digital Business Transformation is their first experience with IMD, 90% of their hands go up. The program, we believe, offers a good blend of fundamentals and concrete examples. We ensure that case studies provide substance and insights from the research undertaken by IMD’s Research Center. This, we believe, gives great depth to the course. Further, what also sets the program apart is the strength of our bench. Participants have access to a host of experienced professors and researchers that not only have academic credentials, but real-world business and advisory experience in undertaking digital transformations. One of the smartest things we did was to expand beyond this program and develop the Digital Excellence diploma, which we launched in 2018. At the time, we recognized that while the Leading Digital Business Transformation program offered core foundational knowledge, there was interest from participants in gaining a deeper knowledge of specific subjects. We developed some additional modules, which come together to form a solid foundation. Various modules extend deeper into digital transformation, whether it be analytics, execution, or even supply chain. These topics are initially introduced in this program, but the modules of the diploma unpack them further. The diploma has been very popular –with 130 people having graduated so far. Some participants return for some additional modules, and this in itself has kept engagement high. It’s incredibly rewarding for us when past attendees return to campus or sign up for online programs. Creating an ecosystem of past attendees makes for a robust community. The Digital Excellence diploma

The digital landscape is always evolving, and we ensure the program is always evolving too. This keeps it interesting and relevant. We now spend more time focused on issues such as AI, analytics, cyber security, and topics like governance. These were not necessarily front and center eight years ago, but they are increasingly important today. However, regardless of how the landscape is evolving, which we can always address, the main challenge in successful digital business transformation is organizational change. It’s about how to convince people to do things differently, it’s about breaking down silos, which is important in digital transformation because the benefits are amplified by scale. So, no matter what, managing people and making sure you get them on board is critical, because the reality is that the failure rate of digital transformation is still relatively high. The pace of digital transformation is not about to slow down, but the fundamentals remain the same. For businesses to successfully transform, it will take business leaders who continually assess their transformation strategies and frameworks to understand and respond to digital disruption effectively. Looking ahead

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Looking back on digital transformation 2015-2022

Tomoko Yokoi Researcher, and Advisor, IMD Digital Business Transformation Center

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Digital transformation is a journey with many twists and turns. As someone who has been on the frontline of the rise in digital transformation since 2015–as both a practitioner and now as a researcher –I feel that it mirrors my career path to date in many ways.

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Back in 2015, most large traditional firms were using digital technologies to incrementally improve parts of their business. The large multinational I worked for at the time was no different. In fact, I led parts of this digitalization in the marketing function where our challenge was to develop new digital touchpoints and services for our customers. But we soon realized that digital transformation required us to truly transform the fundamentals of how we do business. We understood that we had to move from disconnected technology experiments to a more systematic approach to strategy and execution. One way for incumbent firms to accelerate their digital efforts is through open innovation. While this has been a concept since the 2000s, it gained momentum in the corporate world in the mid-2010s when firms started to realize the potential of collaborating with external partners, especially tech start-ups. I decided to see what life was like on the other side of the fence and

went to work for a Swiss-based start-up–which later became a “unicorn”–as well as dabbling in my tech start-up. What I learned from this experience was that challenges abound on both sides of the fence. Digital transformation is rarely a seamless experience. Having seen both ends of the spectrum, I started my third career as a researcher studying digital transformation– a phenomenon which has no easy answers. Take, for example, the fact that 87% of digital transformation programs fail to meet original expectations. While awareness of the need for digital transformation is at an all-time high, there is more to do to advance our understanding of how to transform effectively. Looking back on the evolution of digital business transformation since 2015, I offer three reflections.

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1. Hits and misses

Indeed some digital transformation success stories point to significant investment into cultural change. Take Singapore-based financial services DBS Bank, which has been widely acknowledged for its digital transformation efforts. The bank recognized that to achieve its digital ambitions, it needed to change its culture to one that was more agile, customer-centric, and innovation-driven. The bank’s leadership introduced a “Live More, Bank Less” ethos that aimed to put the customer at the center of their digital banking activities. It also embraced design thinking and agile methodologies to foster a more collaborative and iterative approach to innovation. Moreover, the bank invested heavily in talent development, creating a culture of continuous learning and upskilling. Many companies talk about making themselves more agile and risk-tolerant, but bringing this about is not easy. Others who have achieved some success–such as ING Bank, Michelin, and Walmart –have invested significant efforts in their cultural transformation.

Advances in digital technologies have opened new avenues for value creation. But despite advances in technologies and the specific technologies used, the prevailing guidance since 2015 has been that digital transformation is just as much about people and organizational change as it is about the specific technologies being used. In 2011, General Electric (GE) embarked upon an ambitious digital transformation program leveraging the Industrial Internet of Things (IIOT). At the forefront of this strategy was GE Digital, a technology venture that was established to transform the company into a software and analytics powerhouse. However, as the company ran into performance issues and senior executives departed, GE’s motivation to continue its digital transformation journey faltered. By 2021, rather than driving a company wide transformation, GE Digital was folded into a combined power and energy business as the company separated into three separate businesses. GE was not the only company that ran into problems after launching its digital transformation. Procter & Gamble wanted to become the most “digital company on the planet” in 2012 but ran into growth challenges– as did Burberry and Ford There are many factors that block a successful digital transformation, but one of the most often cited factors is culture. “The big moment for an organization is when they have embraced the fact that digital transformation isn’t a technical issue, but a cultural change,” explained Ian Rogers, former Chief Digital Officer of luxury giant LVMH.

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2. Disruption or shiny object?

Digital technologies and emerging technologies often go hand in hand. Trying to sort out which technology is potentially disruptive, and which is merely a passing trend, has been a challenge for many digital leaders. In 2015 the World Economic Forum’s Global Agenda Council surveyed 800 executives and experts from the ICT sector as to their prediction of when “tipping points”–moments when specific technological shifts might hit mainstream society. The results can be found below in Figure 1. In retrospect, many of these tipping points occurred earlier than these predictions predicted. The Internet of Things (IoT), robotics and blockchain have de facto become standards

in some industries (e.g., the automobile manufacturing industry, software industry, and industries linked with financial institutions). One new technology that has gained popularity in recent years is artificial intelligence (AI). With the power to automate, provide prediction of outcomes, and discover patterns in massive amount of data, AI has the potential to change many aspects of business management including decision-making, problem solving and other processes. A google search comparing three search terms artificial intelligence, Internet of Things and big data shows the increased interest of AI in mainstream society as it relates to business and industrial applications (See Figure 2). The trick is not only to understand when, but how to use AI for digital transformation success.

Respondents who thought the tipping points (shifts) would occur at some point in time provided the years when they expected that these would accur, with the earliest shift in 2018 and the latest in 2017. The results show that a significant number of shifts were expected to occur in the early years of the next decade.

2018

2021

2022

2023

Storage for AII

Robot and Services

• The Internet of and for Things • Wearable Internet • 3D Printing and Manufacturing

• Implantable Technologies • Big Data for Decisions • Vision as the New Interface • Our Digital Presence • Governments and the Blockchain • A Supercomputer in Your Pocket

2027

2026

2025

2024

• Bitcoin and the Blockchain

• Driverless Cars • AI and Decision-Making • Smart Cities

• 3D Printing and Consumer Products • AI and White-Collar Jobs • The Sharing Economy

• Ubiquitous Computing • 3D Printing and Human Health • The Connected Home

Figure 1: Average Year Each Tipping Point Is Expected to Occur

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Interest over time

Artificial intelligence

Internet of things

Big data

100

75

50

25

Average

Jan 1, 2015

Oct 1, 2020

Figure 2: Google search terms, worldwide data 2015-present

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3. The evolution of the “D” in CDO

The trendiest C-suite role since 2015 has almost certainly been the Chief Digital Officer (CDO). Accelerating digital transformation has been a key objective for many companies, and a popular way to go about it has been to appoint a CDO to lead the digital agenda. According to research from PwC, 2016 was the peak period for CDO hiring, with the growth rate slowing significantly over recent years. Research from IMD reveals that the average tenure of a CDO is 31 months–and that three-quarters of them leave the company immediately after their tenure. The CDO role is about evolution. Initially hired to kick off strategic digital transformation initiatives, the role is marked by a lot of dazzle –CDOs are given extensive responsibilities and visibility, creating buzz and excitement. After the initial stage of euphoria, however, the CDO finds themselves increasingly disconnected as the enormous scope of digital transformation becomes clear and business support begins to wane. While organizational resistance is part of the challenge, the CDO faces a depressive situation where, as time passes, the transformation fails to deliver the expected results, leading to the CDO’s eventual and inevitable departure. However, a recent report from Gartner suggests that the CDO role won’t completely disappear but will instead evolve into a more collaborative role where the CDO becomes the de facto Chief Data Officer in organizations without this role. Data–including terms such as AI, machine learning, and analytics–is being talked about in two ways. As data becomes more visible to shareholders, the need for its protection grows in terms of guarding against risk security,

regulation, and governance. It is also spoken about in terms of its benefits in relation to value, customer experience, and growth. Another type of CDO–the Chief Data Officer, in charge of the strategic approach to data for their organization –may become the next C-suite trend. If there is one thing that we have learned over these years of research, it’s that digital transformation is hard. The business operating environment is constantly changing, and organizations must adapt accordingly. In this respect, digital transformation is a time-resistant phenomenon related to change. Yet, as a journey with many twists and turns, a new challenge presents itself at each turn. Some of these challenges are related to technology, but often the barriers to successful transformation are organizational. They concern people, organizational structure, culture, incentives, governance, and a host of other issues. What has become evident over the past years is that digital transformation is not so much a destination, but how you get there.

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They refer to me as The Transformer: I set change in motion and put things in order when they are not

Giulio Vannini Senior IT Lead at Ferring Pharmaceuticals, has long been passionate about the opportunity that digital technologies present for transforming business. So much so that a decade ago, when he was at Merck Group, he helped pioneer enterprise social practices well ahead of the mainstream tools that are more widely adopted today.

In 2015, Vannini, who was Director and Head of Digital Workplace at Merck Group, a global healthcare, life sciences and technology company, was the program lead for Merck’s award-winning Connect15 initiative. Connect15 was a project focused on transforming the company’s legacy IT systems to enable harmonized group-wide digital workplace collaboration. “We were ahead of our time when we started this significant digital transformation project,” said Vannini. “It was exciting because it presented the opportunity to use technology to bring the company’s vision of a more digitally collaborative future to life.” While the Connect15 project team initially looked to clean up old technologies, they were increasingly bold and innovative in their thinking. They set about building systems that would enable digital communication, collaboration, and knowledge sharing across the organization.

“It was at this time that I enrolled in IMD’s Leading Digital Business Transformation program,” he said. “I was keen to explore digital transformation from a business perspective to better understand what the business challenges are, so that I can provide the technological solutions. The way I see it, as the technology expert I am always the companion, whereas the business is in the driver’s seat.” Connect15 resulted in Merck launching its new global intranet –internally branded as “EVA”–as a digital workplace in 2015. It replaced several disparate platforms and provided the foundation for future digital collaboration. The award-winning EVA platform was designed around the concept of ‘rooms’ for collaboration and publishing across departmental boundaries and national borders for its 60,000 employees. Its success was accredited to the strong governance model put in place and a well executed change management program driven by group communications. Merck’s modern digital workplace

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“It was about more than just organizing information,” reflects Vannini. “We saw an opportunity to help connect people, and this set the wheels in motion for digital collaboration as we now know it. This was not common at the time.” “We pioneered social practices, collaboration and engagement into working anytime, anywhere and from any device.” While the project revolutionized the way of working at Merck, Vannini said that with hindsight they started too early. Flexible working was less common at that time, and employee experience platforms were not yet mature. It was also just before the move to the cloud became a possibility. “We built a system that was company-owned, but soon the technology became available that would have enabled us to embrace the cloud,” said Vannini. “When you build on your own, unfortunately you create a lot of heaviness. In 2020, Vannini joined Swiss multinational company Ferring Pharmaceuticals as the Senior Lead of IT Infrastructure Transformation and Analytics. He was tasked with the migration of Ferring’s analytics infrastructure into the cloud. “They refer to me as The Transformer, or The Cleaner,” he joked. “I put things in order when they are not.” Ferring wanted to transform its customer-related processes and to enable more insight-driven decision-making. Vannini explained that to achieve this level of data governance, standards had to be unified across all divisions and customer data needed to be transformed into a common data warehouse in the cloud. This would ensure efficient business workflows and give employees the ability to obtain powerful insights from company-wide data which would enhance customer experience. Ferring sets its sights on being an insights driven organization

A foundation of intertwined data is laid

The pilot project took three months to implement, and during this process it was important to create a single source of unified data from multiple sources. This single source of data would enable Ferring’s marketing teams, no matter which of the 65 countries they were in, to use data-driven insights that create personalized client-centric campaigns to drive higher engagement. “We converged multiple internal data streams to create Ferring’s data foundation,” explained Vannini. “We also set the course for expansion, such as big data from external sources. The platform now is evolving into a single source of truth, unifying processes and data across many offices and countries.” Although Vannini has now moved to a different role within the organization, more focused on infrastructure outsourcing, he found great satisfaction in helping to set up the digital transformation pathway at Ferring. “I have learnt that the key to successful digital transformation is combining business change with technology. This is the essence of what I do. I take a vision and I make it happen technologically. Then when it works, I move on to the next transformation.” Although it has been seven years since he completed IMD’s Leading Digital Business Transformation program, Vannini says he has kept in contact with Faculty over the years to exchange ideas and for some advice whilst working on projects. He is also still in contact with other IMD alumni he met at IMD. “Jobs change, but people don’t,” he said. “We stay connected. This is the major value I see every day from the attending the program.” A like-minded business network

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Enabling a data-driven culture of customer centricity at Porsche AG

Klaus Ullrich Global Head of HR Retail Development, focusing on retail transformation at luxury car brand Porsche AG, is passionate about people. He believes that when it comes to customer service, it’s the people that count. Ensuring the global retail staff is equipped with the ability to deliver the ultimate customer experience has been top of mind for Ullrich throughout his 16-year career at Porsche.

Porsche has been on a transformation journey for a long time. With the launch of its Strategy 2018, the company aimed to keep profit margins high amid the unstable market. Porsche’s goal is continued growth by value-added investment opportunities and expansion. This was also at the time it was preparing to launch its first compact SUV, the Macan, to a broader customer base. “It was not just the launch of a smaller SUV; we were also expecting new customers joining our brand for the first time and this was a new step up. We launched a dealer consulting program (Porsche Business Excellence) to jointly identify room for improvement –investors, retailers, and HQ–hand-in-hand as partners. We identified

through the workshops and staff surveys we undertook that 80% of operations are the same at all dealerships, no matter which country they are in. However, 20% is the ‘local flavor’ that is different. But the key element that remains the same is how people are managed, treated, motivated, and incentivized as this drives a high performance team, which benefits the customer.” Porsche has more than 860 dealerships globally, of which only a small number belongs to Porsche. Most of these dealers are in the hands of independent investors.

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A relentless focus on customer service

spurred by the recognition that every employee had the ability to embrace change and in doing so become drivers of the transformation. “My work is all about people,” explained Ullrich. “Their buy-in is instrumental in driving change.” Ullrich explained that at Porsche the customer is always center stage. The company is motivated to ensure that every customer experience, no matter the touchpoint, is optimal. It is this aspiration that motivated Ullrich to explore how to use data to build a deeper understanding of Porsche’s customers and how to serve them in an evolving and seamless omni-channel environment. In his capacity as the Global Head of HR Retail Development, with a focus on people excellence, Ullrich considers how the retail organization will look in the future. He is focused on understanding it from a customer perspective, so the questions he continually grapples with are focused on what customers need and what a seamless omni-channel journey means for them. When considering new retail formats, he needs to ensure that it offers a seamless interaction experience for the customer, no matter where they interact with the brand. He is particularly interested in an approach that considers culture, mindset, and behavior as is seen in the successful service industry model. “Hotels and airlines have been doing this well for decades, offering personalized services to their customers, and that’s the level of service we want to offer our customers across our entire network,” he said. Bringing the ‘Porsche experience’ into the digital era

Buy-in for Strategy 2018 from its network of dealerships was essential to meet the company’s transformation ambitions. Further, ensuring that everyone across the Porsche network continued their relentless focus on customer service was critical. Ullrich deliberated at the time how to ensure that Porsche’s entire network of dealerships was offering the ultimate customer experience and, importantly, was able to offer this level of service to a new type of customer. Ullrich was tasked with establishing a number of initiatives and programs to engage all staff and stakeholders across the organization. The people-focused programs, such as the Porsche Dealer Academy, an executive MBA for general managers, would continue to benefit the organization for the years ahead and firm up its culture of customer centricity. Porsche continued to progress and evolved by launching its initial 2025 Strategy under the motto “The future of sports cars” focusing on its product portfolio. This combined tradition with innovative technology and sustainability - aspects such as electromobility, digitalization and connectivity played a key aspect. Despite all the changes, there was one constant: Porsche will stay true to itself. And people will remain key enablers in this strategy when focusing on retail transformation with e.g., a new job role portfolio and a sharpened understanding of cultural behavior, further enabling leaders in multiple management programs to drive customer centricity. The success was in part An ongoing digital transformation journey

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The data-driven decision-making opportunity

Ullrich identified the significant opportunity that data-driven decision-making presents when it comes to customer service. His interest in establishing a digital strategy to conduct data driven decision-making at Porsche motivated him to pursue the Digital Excellence Diploma at IMD.

“

When I started the Digital Excellence Diploma at IMD, I wanted to know how I could ensure that, when a customer comes into any store or any other virtual touchpoint, the customer expectation is not just met, it is overachieved. I wanted to know how I could equip my team with the ability to do that.

“I wanted to know how to focus and measure information from disparate systems across our wide dealership network. I also wanted to figure out how to show the business case for tracking this information.”

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The business case for a virtual assistant for retail staff Porsche and its dealership network have amassed a robust volume of customer data, which Ullrich saw as an opportunity to create better customer experiences by harnessing data to inform the customer experience. This motivated him to explore solutions that would enable Porsche’s sales force to access this information effectively. “We have access to a CRM database, and we have data produced by our vehicles but hardly data from our global staff to identify their actual needs to provide this expected customer experience, and I knew that if we could match this information, we could use it to create a great customer experience.” It was clear to Ullrich that building blocks were there, but he was grappling with how to get the information to retail staff as they need it in a seamless way. He said that he saw the opportunity to use virtual assistant technology to do this because he felt that this solution would be ideal in a retail environment. “I needed to figure out what kind of sensor or virtual assistant we could find to provide this service,” he explained. It became apparent though that the sensors needed to access and make sense of Porsche’s data and its dealership data do not exist currently, especially within the context of a legal framework around customer data protection. But the business case was compelling. Ullrich chose to focus his final diploma paper on solving the challenge he faced.

“At that time, I only had an idea,” he recalled. “I was not an expert in machine learning, but going through the course I could start to grapple with a range of possibilities.” When reflecting on what he learned, Ullrich said that his goal was not to be a great data scientist; rather it was for him to have the ability to see the bigger picture and drill back down. He was able to understand better what data is needed, how to access it, and, importantly, how to determine what kind of systems to use. After completing his Digital Excellence Diploma, Ullrich has since had the opportunity to present the business case for data-driven decision making at Porsche. He is now working on sensor prototypes to enable this.

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But what is digital transformation?

Vera Steullet A digital transformation and strategy consultant who holds a PhD in chemistry and a master’s degree in information technology, Steullet has watched the evolution of digital transformation with interest. Motivated to understand the impact of digital transformation through the lens of business, she embarked on the Leading Digital Business Transformation program in 2019.

A self-confessed agile enthusiast and scientist at heart, Steullet finds pleasure in using her scientific insights to transform data into valuable digital assets. Steullet, who in 2019 led the digital department for research and development at one of the world’s largest food and beverage companies, was inspired to explore how data-driven digital transformation could deliver value for the business. “I was part of the R&D center at the time and R&D was seeking to understand what their role would be in digital transformation,” she said. “I wanted to understand the bigger picture from a business perspective, not just the digital part which I was already familiar with. I wanted to know how we could go beyond digitization and explore how technology could innovate and transform business.” Steullet said enrolling in the Leading Digital Business Transformation (LBDT) program helped sharpen her understanding of how digital technologies can be used in value creation when developing new business models. The program also provided tangible tools she used to execute a digital roadmap for one specific area of the company.

“I gained a deeper perspective on the difference between pure IT digitalization and transformation, and the impact innovation can have on business,” she explained.

A roadmap to a more digital future

The fundamentals of digital transformation gave Steullet a good foundation to engage with her stakeholders, but also highlighted an overall gap in understanding around how to effectively execute transformation. The course gave her the resources to transform the department in a way that would enable agile digital transformation. “The course provided me with a lot of ideas, but it also highlighted the need to bring my stakeholders along the journey with me. I realized that they were lacking some fundamental knowledge about digital transformation.” This realization led her to collaborate further with IMD and create a digital transformation workshop for her colleagues. The workshop provided the platform for her colleagues to connect around the basics of digital transformation and to clearly define what digital transformation could mean for their organization; something that would become critical to the success of the whole transformational roadmap.

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Defining digital transformation

Digital health, driven by data

“My first goal was to define what our strategy would be,” she recalled. “Then we had to get all the stakeholders to endorse the strategy and agree on the projects that would allow us to start moving forward in our journey. “Everybody thinks that they know what digital transformation is, but if you ask for an exact definition, people have many different answers.” Steullet said having a clear understanding of digital transformation is critical. “It can’t just be a buzzword, because without a strong common understanding people can’t collaborate toward a common goal.” She believes that vaguely defined goals, like seeking to transform business using digital tools and innovation, are insufficient. All stakeholders need to acknowledge that digital transformation is founded in concrete science and established frameworks, as well as agree on common definitions and expectations. “The workshop was fundamental to our success because it gave us the common language among stakeholders to talk about digital transformation and agree on our common goals.” The workshop enabled all stakeholders to align behind the first digital transformation project, that would span multiple functional areas within the organization. The ability to extract value from the company’s data was a clear priority project. Key to this was creating a foundational layer of data. “Of course, every function in a big company has their own priorities and own objectives, so creating a foundational layer was essential.” “We all came together; it gave us a common foundation to understand each other and to make sure that we were talking about the same thing,” reflects Steullet. “It gave us a fantastic starting point and was the beginning of our digital transformation journey.” A foundational layer of data is developed

A decade after joining the food and beverage company, Steullet has now established herself as an independent digital transformation and strategy consultant. “I was keen to build a portfolio of clients where I could apply my knowledge to various sectors,” said Steullet, who is already a consultant to several organizations. For example, Steullet is currently working with Savor Health, a personalized nutrition technology platform that provides personalized and clinically appropriate nutrition recommendations and support to people with chronic medical conditions. “Coming from a scientific background, I have always been passionate about nutrition and health science,” she said. “I work as a data strategy advisor, looking at what value Savor Health could extract from their data. Using the IMD framework, we developed a series of models, from which we generated predictions about how to transform both the company’s functions and business. These predictions provided a baseline for decision making on the direction the company can take in the future.” “It was an interesting exercise. Company experts know their data much better than I do, so they had a lot of great proposals. Then, working together we were able to formulate new and exciting ideas. This experience showcases the power of the IMD framework.” Steullet has continued with her learning journey and successfully completed IMD’s Developing Digital Transformation Strategies program in 2022. “The knowledge I gained in pursuing this diploma, together with the experience I developed over 20 years in the industry, have allowed me to elaborate a solid methodology– which I’m now applying to help my clients extract more value from their data to transform their business.” The road ahead

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Tech is just the enabler

Pere Nebot No matter what technological trend is reshaping an industry, a relentless focus on the customer is paramount, said Pere Nebot, Chief Information Officer at CaixaBank.

For more than 20 years, banking industry veteran Pere Nebot has held key roles in the information technology department at Spain’s leading bank. He said that hypervigilance is critical to remaining relevant in a sector that has been massively transformed by digital and this is no different at CaixaBank, Spain’s leading bank in digital customers. CaixaBank continues to set the bar as one of the leaders in digital innovation and transformation. Its digital transformation strategy has earned it the accolade of being one of the highest-rated banks in the world based on the quality of its digital products and services. US magazine Global Finance named it as “one of the most innovative banks in Western Europe” in 2022. CaixaBank is on a continuous digital transformation journey. It is exploring the use of several emerging technologies including big data, cloud, and blockchain to improve operational efficiency, diversify product portfolio, and enhance customer experience. At the heart of its digital philosophy is simplicity, its strategies focus on creating digital services that offer an uncomplicated, seamless customer experience. The bank’s strategic plan is focused on the customer and developing the best solutions while offering excellent customer service.

“You can change your digital ecosystem, you can change your legacy system, you can put AI in the mix, but in the end, it is about the purpose,” said Nebot. “You need to ask yourself what is it that you want to do with all the digital capacity. No matter what, transformation must be linked to the business strategy, tech is just the enabler. “In the end banking service is about the customer; AI and blockchain are the technologies. Understanding the customer and designing the right proposition for them is key.” Nebot, who leads the 1,000-strong IT department responsible for IT across the entire financial services group, joined CaixaBank at a time when the bank was already focusing on digital transformation. The bank’s journey continues as digital innovations rapidly transform the sector. Nebot said it is important to always keep your finger on the pulse when it comes to digital transformation. “It is essential that I keep up to date on what’s happening in industry and society, otherwise in five years if you don’t get any new insights, you are quickly out of date.” Digital preparedness delivers

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No need to fear challenger brands

Nebot acknowledges that without data it is impossible to understand 100% of what is happening in an organization or in its systems. However, he said learning about the opportunity that data presents in identifying blind spots, that are not obvious at first sight, was fascinating. Relating this to CaixaBank’s customers, he said that thinking that the bank’s twenty million customers would act in the same way would be a huge mistake. “With data, it is possible to identify the outliers, which highlights that it may be important to consider new ways of interacting with them.” The importance of digital connections is only becoming more important Nebot said because with data you can create digital events, which can be used to connect different ecosystems. “Digital ecosystems are very powerful –not only to reduce costs, but also for creating new products, delivering services, and creating new customer experiences.”

The evolution of fintech has given rise to challenger brands that offer consumers an online-only banking experience. While the challenger brands have shaken up the sector, Nebot believes when it comes to digital transformation, traditional banks can learn from the online-only banks who can be more nimble and agile. “Challenger brands are not a threat; they help us to improve ourselves,” he explained. “They raise the bar of the user experience, forcing us to make things better. If we can change and improve in the same way as the digital entrants do, we will continue to be successful in the future.” Nebot takes time out of his busy schedule to attend in-depth courses whenever he can. He said that the insights he gains from programs such as Leading Digital Business Transformation (LDBT) provide him with the external perspective and knowledge that helps frame his approach at work and inspires opportunities to innovate. Nebot, who attended LDBT in 2017, said what he learned then is still highly relevant today. The concepts of ‘hyper-awareness,’ ‘blind spots’ and ‘digital connections’ were of particular interest. “You must be constantly aware of what is happening around you, but this doesn’t mean you have to apply it in your organization,” he said. “You do, however, need to be aware of what is happening.” You can never know enough

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Leading Digital Business Transformation

Hyperawareness is key to success in the digital era

Carlos Bártolo Start-ups need to be at the forefront of technological advancements and pivot quickly in response to them if they want to stay relevant, said entrepreneur and tech start-up founder and advisor Carlos Bártolo.

Carlos Bártolo has experienced first-hand the rapid pace of disruption in the creative sector over the last eight years. As a co-founder of Glymt, an AI-driven video-technology platform, the company has had to be at the forefront of the advances in technology that are rapidly changing the way we create and consume content to carve out its space in this competitive sector. Bártolo is also a jury member of the European Innovation Council (EIC), Europe’s flagship innovation program, which focuses on identifying, developing, and scaling up breakthrough technologies and game-changing innovations. To provide advice to companies, projects, and innovators supported by the EIC, Bártolo must ensure that he is always on top of the latest trends and technologies impacting companies across industries.

“At the time there were less than 3,000 videos on Shutterstock, so we decided to set up a video crowdsourcing platform that helped creators from around the world to monetize short clips from their passions and interests,” said Bártolo. However, advances in technology, notably the arrival of smartphones with high-definition cameras, and the rapid growth of popular video-sharing platforms, soon threatened their business model. “Suddenly millions more people were able to produce high-quality content, and the likes of TikTok and Instagram were making a crowdsourcing platform less appealing,” Bártolo explained. Glymt moved quickly to evolve its product. The platform added simple video editors and the ability to incorporate 3D assets into existing videos, to give companies the tools needed to produce high-quality, customized content on demand. Unlike its more established competitors, Glymt was also able to offer customers a simple pricing model.

Staying ahead of the game in a rapidly changing sector

Bártolo and his co-founders established Glymt in 2015 after having identified a clear gap in the market for affordable video content for companies that didn’t have the budget for traditional agencies.

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“In a competitive industry dominated by three well-established companies, it has been important for us to find spaces to innovate and to act quickly to bring these innovations to market,” said Bártolo. After having initially set up the businesses because of a lack of video content available, rapid advances in technology meant that this was no longer the case as the world moved into a period of content overload. “We realized that speed and efficiency in terms of finding the content you are looking for amongst millions of videos available online today was increasingly important, Bártolo said. “This is where the hyperawareness of what technologies are available is particularly important. For example, we quickly realized that we needed to shift our platform’s fundamental computing engine from a central processing unit (CPU) to a graphics processing unit (GPU), to enable a quicker and more efficient user experience.” Disruption in the sector continues, he argued, with the advances in artificial intelligence naturally impacting this sector. “The full extent of the impact of AI on this sector is not yet known, and there are many debates– from intellectual rights to the need to protect livelihoods that still need to play out. What is important is to stay informed, to be aware of shifting sentiments, and to be prepared to act quickly once you have decided how to move forward,” said Bártolo.

A guiding map

Bártolo, who is an IMD MBA alumnus and a recipient of an IMD Lifetime Learning Award (2009), participated in IMD’s leading digital business transformation course in 2016 soon after founding Glymt. “When you are starting something up, you get very involved in the detail,” he said. “But what you need is a map for how to move forward, the program provided that map for me and proved valuable in terms of positioning the company in the market. “It also gave me useful perspective, both for Glymt and for my role on the EIC, into the importance of being at the forefront of what is going on around you and of ensuring you have the ability to react quickly to constant change.” Another key takeaway was the importance of understanding the important relationship between technology and human behavior and how important it is to be aware of how one impacts the other when making decisions. For example, Bártolo advises several companies that are using technology to revolutionize the healthcare sector. “Although technology can have a massive impact, there are still many obstacles to overcome, brought on by the competing interests of many different stakeholders, from the medical community to insurance companies,” he explained. “The course highlighted for me how important it is to be aware of the impact of human behavior on the growth prospects of your business and to factor this into your decision making.”

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