Digital business transformation is about the customer, and it is about moving fast, or so says Marco Ryan. He is the chief digital officer at Wärtsilä, a company which has been making digital transformation waves across the Nordics. But he has been applying digital transformation across some of the world’s most well-known companies for years. You could say that as far as digital transformation is concerned he knows his onions. This is rather appropriate, as Marco reckons that what he calls the digital onion serves as a superb metaphor, illustrating the true meaning of digital transformation. He also has views on the older way, the more analogue approach to business, which he compares to the most famous temples of Ancient Greece: The Parthenon.
Marco Ryan has been applying the ideas of digital business transformation pretty much since day one, since the concept was first conceived. Before he was at Wärtsiäa, he was Chief Digital Officer at Thomas Cook Group, before that: Managing Director at Accenture Interactive in Asia. You could even refer to him as Mr Digital Transformation. Or to give him a middle name, Mr Digital Business Transformation.
He says that the older way of doing things often involved a rigid structure, a company divided into silos, HR, finance, marketing, sales, IT, and somewhere along the lines there was the customer. He likened such a structure to the Parthenon, a Doric column to a silo, the customer at the top, represented by plinth.
But then we live in the post Blockbusters, post-Nokia mobile phone, post-Kodak age; Amazon an ever-present threat, like the Amazon queen, replacing the statue of Athena which once stood at the centre of the Parthenon. The Ancient Greek temple is now a ruin, a monument to what once was. For companies trying to survive today, the Parthenon business structure needs to crumble too, replaced by the digital onion, or so suggests Marco.
Moving the organisation from a very vertical, structured, almost waterfall model to a much more agile, adaptive model comes from starting with the customer need
At the onion’s core is the customer, key to everything the digitally transformed business does. In this model the layers of an onion represent teams running across the speciality spectrum, the techie, the finance expert, the engineer, the… whoever, working together — no barriers, no silos, a sphere, all parts of the business in touching distance with each other, the customer never far away.
A practical example of digital transformation
But you don’t get there overnight. It took the Parthenon 2,000 years to crumble — at one point it was used as a warehouse to store ammunition.
Marco says: “Moving the organisation from a very vertical, structured, almost waterfall model to a much more agile, adaptive model comes from starting with the customer need. “
However, people often set up a digital division or set up a funky bit of innovation in a location which is distinct from the rest of the business. Up to a point, Marco says “this is the right approach, because you may need a different environment or a different space to make it safe, so people can try and understand this new way of working. The mistake that many companies make is to then put that in a separate division; because it then becomes ‘them and us’ — ‘it’s the cool kids doing the funky stuff that seems to cost a lot of money but not really add value versus my engineering team who have been doing this for 20 years and actually have customers.’”
So, you start, he says, by focusing on parts of the business, but physically putting the innovation centres at the heart of a company, by co-locating innovation labs or environments, and not at some distance location. He says that if you do this, three things happen:
- Firstly, it becomes very tangible, visible to people, when they walk past. They see what’s going on and they become curious.
- Secondly, it demonstrates how the digital business transformation process is about enabling the business, it demonstrates how it is integral to the whole.
- And the third part of this is that you get quick wins.
“As a result of all this, it becomes viral. So, people see things done quickly and they want more.
“If it’s done in a completely separate location with a start-up in say San Francisco, it’s very difficult to integrate it later.”
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The true meaning of digital transformation?
Marco says there are three key elements to digital business transformation:
- Firstly, it’s about working on problems together. The Acropolis to Onion model is a useful way to understand that it’s not about structure, it’s much more about how you work on problems together across boundaries. It helps people visualise that, actually, the new way is organic — business lines and products will come and go much more quickly than in the old way, where they were set in stone for five or ten years. Citing Wärtislä as an example: “So we changed our organisational structure around the changing needs, which means we have to be very adaptive, supported by adaptive IT; we have to have very good processes and clear communications.
- The second thing is culture. And digital business transformation means that it’s got to be relevant to individuals on the ground in their daily work. You need to produce new tools or ways of working to do that. It has to be safe for them to try; you mustn’t punish them for failure. And you have to recognise that different people have different ways of learning, so you have to provide a range of solutions. And lastly, it requires the leadership to really get behind this.
- The third component is open innovation rather than innovation. Don’t make innovation a separate function; it should be a way of working.
So how does this really work. Read on for a practical example of digital business transformation, as has been applied at Wärtsilä.
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