Digitalization is changing everything – including how we do business
By 2020, Generation C (for “connected”) will have grown up in a truly digital environment. CEDs (consumer electronic devices), the internet and social networking are second nature to them.
Expertise in technology, reliance on digital services and mobile communication, and the desire to remain in contact with family, friends, and business partners will significantly alter daily life.
But technology is not only transforming how we go about our daily lives. It is also set to disrupt all areas of business.
Customers are accessing goods and services in entirely new ways, and pricing, distribution and services are changing simultaneously.
Adaptation is a must
As the pace of change increases and the range of technologies grows, it’s vital for companies to move fast.
The challenges that the digitalization of business presents are numerous, stretching from new competition to changing customer engagement, to cybersecurity.
“Digitalization dismantles the old partitions, allowing the supply chain to become a fully integrated ecosystem transparent to all involved.”
Yet those companies that adopt an agile mindset, move to eliminate silos and embrace the knock-on effect of digital technologies are well-placed to ride the wave of digital change and revolutionize their business in the process.
“Integrating digital technologies into R&D, product development and commercial operations means companies will have to adapt pricing strategies, sales processes and distribution models,” says Stephan Preussler, Global Consumer & Industry Insights Manager, PUR Industrial Marketing. “Digital products and services demands a different skill-set to traditional goods; companies need to act fast to incorporate new organizational structures to manage these operations.”
While the opportunities are immense, it is vital that organizations recognize how far and how quickly they must transform, taking on business-wide modifications to structures and processes, as well as changing the culture of how people work.
As the key to Industry 4.0, digitalization has the power to transform the traditional supply chain.
Today, supply chains are sequences of separate and independent steps within differing departments – such as marketing, product development, manufacturing and distribution.
Stephan Preussler, Global Consumer & Industry Insights Manager, PUR Industrial Marketing
“Digitalization dismantles the old partitions, allowing the supply chain to become a fully integrated ecosystem that is more transparent for all involved,” says Stephan. “The result enables businesses to anticipate or react to disruptions in the supply chain, by modeling the network, creating scenarios, and adjusting the supply chain in real time as conditions change.”
Such systems allow for considerable resilience and enable competitive advantages, providing customers with the most efficient and transparent services.
New technologies are essential for digitalization to function properly and continue to evolve. Some of the more prominent technologies driving the digital transformation include:
- Internet of Things: data generated by connected objects will be used to create opportunities to enter new markets, transform existing products, and introduce new business models
- 5G: this mobile technology will be key to cover the vast amounts of data produced by the Internet of Things
- Big Data / Data Analytics: information generated by the Internet of Things
- Artificial Intelligence: impacts business, from customer service to analytics and marketing
- Augmented Reality (AR): this allows three-dimensional conceptions to support the training, proposal, and genesis of new ideas and products
The customer journey
Today, consumer expectations are already conditioned by online experiences, where every imaginable service is merely a click away. And the expectations we’re witnessing among end consumers are rapidly transferring to customers within the B2B community.
These expectations include:
- Reduced costs
- More certainty
- Speedier and easier transactions
- Tailored offers
Businesses are expected to use technology such as machine learning and artificial intelligence to create genuinely smart products and services that meet these increasingly high expectations.
“Customers will reward brands that pull other services into relevant products to enhance their user experience, save them time, or provide extra functionalities,” says Stephan.
We are seizing all the opportunities offered by digitalization with a comprehensive strategic transformation program: Digital@Covestro.
Launched in 2017, Digital@Covestro seeks to enhance and expand our digital activities with the motto: whatever can be done digitally will be done digitally. The focus is on creating tangible benefits and added value for our customers and employees, right through the supply chain.
“Customers will reward brands that pull other services into relevant products to enhance their user experience, save them time, or provide extra functionalities.”
The Digital@Covestro program comes in three core pillars. Through Digital Operations we are optimizing and developing our production, R&D capabilities, supply chain management and internal processes in HR and accounting – all with the aim of making our internal operations as efficient as possible. With our Digital Customer Journey, we set new standards in collaboration by engaging with customers from across regions and industries to understand their needs and continually adapting our offerings to match these. Meanwhile, our new ventures in Digital Business Models include an innovative online sales platform for chemicals and the rollout of Digital Technical Services whereby we use data analysis to enhance customers’ production facilities.
A few key takeaways