Digital Business Transformation – it’s more than IT
The rapid technological change is driving today’s economy. Trends like digitization, sharing economy and new group of customers and employees are challenging the status quo of the traditional organizations, especially the established auto industry.
What started as a technological revolution is now changing the consumers and even more the workforce. The rise of the ‘Millennials’ and Digital Natives have led to a number of new cultural norms and behaviors significantly different from those of prior generations. Utilizing on ubiquity of internet, digital natives are expecting access to information when and where they need it, striving for autonomy. Generation Y – or the Millennials – are aiming for flexibility and autonomy in their workplace, are motivated by an innovative and dynamic work environment, and the chance to positively impact society.
The company’s value proposition depends on resources and most important: employees. This is why manufacturing companies need to learn from the tech industry not only in terms of agile IT development, but also about the new work environments and systems in place. And the need for employees, that can think outside the box, combining traditional business with new ideas, entrepreneurs, leading the change and not only following the familiar paths is higher than ever before.
In the past few decades companies have trimmed for efficiency with the aim to standardize processes and to optimize short-term results. Now, speed and agility are key virtues of organizations. Companies need to work differently in order to better respond to market and social changes.
Digitization is forcing automotive OEMs to rethink their traditional strategies, business models and organization structures – organizational structures that lead to agile, flexible cultures which support collaboration, creative thinking and rapid cycle time innovation.
By changing the way of working, automotive OEMs can design products, services and processes with a higher added value to the customers.
Many companies have already opened data or innovation labs to boost their IT and new product development. Often structured like startups – from the culture, way of working and thinking. Design Thinking is one of the central working methods, where the customer is at the top of all considerations. The question is more about how to implement the new ideas, how to make them sustainable, against the old structures and thinking in the headquarters.
As digitization takes up each and every aspect of an organization, concentrating only on the technological side of the change is not enough. With the rise of the Millennials and our always-connected world, automakers need to rethink not only their value chain and IT development, but their organizational structures, internal processes and above all their people recruitment and development approach.