Most companies that are listed in the Dax and MDax are pushing their digitalization quite slowly: Only five percent of the 80 corporations questioned by the recruitment consultancy Heidrick & Struggles about their internal steering of the digital transformation have created and staffed a position for a CDO. To be exact: There are only four of them – with none being on board-level. An additional 16 percent have created a position that deals with digital business but it is named differently.
It was not long until these findings were commented quite critically: We need more CDOs was the maxim. But is that really the case? Is the CDO the key to a successful digital transformation?
I think that answer is too simple. One who really wants to understand the digital transformation must get to its core – and that core lies in the business model. In the past companies made use of technology to simplify their business model. Today business models are created around technology. Ben Evans from AndreesenHorowitz shows this link in his presentation „Mobile is eating the world.“
A simple example emphasizes this thesis: If your city`s taxi company launches an app with which you can book a cab, this does not affect its business model. The app only simplifys the booking process, the rest remains the same. But sharing concepts - such as Uber - totally change the way taxi business is done. And that is quite obviously a huge difference.
Many companies have not yet realized how deep the digital revolution goes. They stick to their old business model and core processes. And then the Chief Digital Officer just makes sure there is some kind of digital touch to it. Social Media is an example for this. The internet is full of pages that look like just another commercial channel. Frankly, a lot of times they are even filled by external agencies. Who acts like that really has not realized that the network generation, Generation Y, communicates and decides totally different from how it was done in the past. And this brings chances for companies: One can network with clients and build totally new business models. As a result, fundamental changes will happen in the biggest industries of our country: Automotive, banks, insurance companies, power suppliers and telco companies are just some of the examples for branches that will go through fundamental changes in the next fivteen years.
I am convinced: A CDO alone won´t be able to master such changes. The digitalization must be pushed from the top and go through to the core. Those who do not have a digital strategy for their business model yet must get going one quickly. Investments, new qualifications and organizational models as well as cannibalization scenarios will be the companions while taking that road.
This article was written by Rolf-Dieter Lafrenz, Consultant and Media Specialist at SCHICKLER Media Consultants in Hamburg. It was also published in german language at www.schicklernext.com.