Just as we entered a new era with industrialisation in the past, we are now entering a new era with digitalisation. Management as we know it today is a response to industrialisation. But where are the responses to digitalisation?
The research focus ‘Digital Economy & Business Agility’ summarises answers to questions that arose in the context of customer projects, combines the answers into a consistent management picture for the digital age, and regularly expands this picture as soon as further answers become available that are relevant for innovative and responsible managers in a networked and dynamic world.
All answers are supported by transparent visualisations: as simple as possible, as detailed as necessary.
Our current understanding of management is based on insights gained during the industrial age and is insufficient for the digital age.
What will be different in the digital age?
The possibility of networking.
Of course, no one is forcing me to network. It is just one possibility. But this possibility is also available to my competitors. We recommend not waiting until declining customer numbers force me to act, but actively embracing the digital age. But how? Our current understanding of management tells us how to run a company. But how do I manage networked value creation?
Networked value creation or ‘digital ecosystem’?
Networked value creation is not synonymous with a digital ecosystem. Networked value creation already exists, for example, when we exchange customer, order or billing data via the internet. But what if my business partner is dependent on this data and I attach conditions to the transfer of my data? Is that rude and contrary to our moral principles? Agreed. New example: What if I am dependent on this data and my business partner attaches conditions to the transfer of their data? We need to integrate this possibility into our management model.
We must therefore differentiate between whether networking is simply networking, or whether it can be linked to dependencies and restrict the management autonomy of participating companies. If this is the case, we call it a ‘digital ecosystem’.
‘Power!’ - Do I really have to deal with this question?
Within a company in the industrial age, top management sets the rules of the game and can enforce them thanks to their authority. For us, this is a matter of course. Otherwise, value creation would not function smoothly. Without common guidelines, production volume and product quality would be left to chance rather than following a plan.
This naturally applies analogously to networked value creation within a digital ecosystem. In practice, we rarely see democratic voting on these rules. In the digital age, we must therefore understand setting these rules as an explicit strategic goal.
Digital Mind-Switch
In a digital ecosystem, individual companies contribute to value creation in the same way that a department within a larger organisation did in the industrial age.
We know that a department head in a larger organisation can pursue two (competing) goals:
(A) Profit target
(B) Career goal (For successful managers in larger organisations during the industrial age, the career goal was often the ultimate goal that determined their actions).
Similarly, a manager in a company within a digital ecosystem should also be aware of two goals:
(A) Profit target
(B) Positioning target
Adapted Business Model Canvas
The Business Model Canvas, which we know from the industrial age, is implicitly based on the assumption that the user of the canvas can make comprehensive decisions on the nine fields. However, since this is no longer the case in a digital ecosystem (for companies that are not the most powerful), the canvas had to be adapted for the digital age.
System-FIT Model
A company that contributes to a digital ecosystem must accept restrictions on management autonomy (unless it is the most powerful company). However, it can and should choose the digital ecosystem(s) it wishes to join.
How can I respond to the dynamics of a connected world?
In the agility of the digital age, business model development is becoming increasingly important. One response to this can be to activate the potential of your own employees. Employees can become partners—but also competitors! The socio-technical framework is an intermediate stage in the transition to digital ecosystems.
Wie kann ich in der Agilität des Digitalen Zeitalters den Überblick wahren und meine strategischen Ziele erreichen?
The digital age is characterized by a high degree of agility. Existing and additional business options must be constantly reviewed and managed. The often-quoted phrase “Don't be afraid to fail!” is usually difficult to reconcile with the sense of responsibility felt by managers in our cultural sphere. The Business Development Portfolio combines high agility with our responsible culture, transparency, and strategic risk management.
Digital Maturity Model
Companies that are just beginning to ask questions about their digital future may tend to search Google for digital maturity models as a starting point. However, almost all of the digital maturity models that can be found consist of standard questions and, once these have been answered, usually conclude that a consulting firm should be contacted for further clarification. In addition, most digital maturity models are based on fixed standard questions. But what is the point of a standard question about a comprehensive customer profile if a company is integrated into a supply chain and has no customer contact at all? The conclusion that a company is not digitally mature because this question was not answered in accordance with the evaluation scheme is therefore not very helpful.
Instead, the goal of the FHNW Digital Maturity Model is to highlight the connections and thus allow each company to manage its own digital maturity.
Contact
Prof. Dr. Dino Schwaferts
- Phone
- +41 62 957 24 23
- dino.schwaferts@fhnw.ch