INTERVIEW OF THE MONTH
INTERVIEW WITH MR MIKKO MARSIO,
Head of Enterprise Digital Business and Digital Lead Process Industries
ASEA Brown Boveri (ABB) Finland
What impact has digital transformation on revenues and shareholders? Can you share with some examples?
When you look at the global list of most valuable companies, it looks very different today than it was yesterday. Companies topping the list are companies that have their revenue generation in digital or companies that are successfully utilizing digital technologies. Scalable business models e.g. platform business models or applications that spread with viral marketing accelerate growth and shareholder value creation. Most of the successful examples of such companies come from the consumer side. On the manufacturing side, there exist very few examples of such companies as they are locked-in to their traditional value creation and existing assets. Manufacturing companies also lag in the cultural adoption of digital technologies.
How have digital solutions helped enterprises to improve actual manufacturing processes? Are you seeing any trends relating to this in the past year?
Digital transformation initiatives that many companies have taken are usually three-fold. Technology is more of an evolutional development while business models and company culture are more transformational in nature or rather need more transformation. Without the last two, business models and company culture, the first one i.e., technology cannot be utilized in a transformational manner. Clearly, data enabled management of manufacturing is a key trend enabling enterprises in enhancing visibility into performances and turning processes into intelligent processes by effectively utilizing data.
We essentially have two areas here: Operations management and Asset management and how to effectively apply digital solutions in these areas at a production line level, plant level, across plants and eventually in value chains. Last year I could see a trend where the focus moved from one plant level development to development across all the company plants.
A growing number of companies are seeing that benefits do not come from investing in technology alone. Best digital solutions cannot bring value without investing in developing working processes, empowerment of people and transparency across the organization. Within most mature companies in digital, ‘digital champions’ are those companies that gained tangible results. Otherwise, they would not be continuously investing in digital even after starting their digital transformation journey years ago. For succeeding with digital, it requires a certain amount of faith because progress tends to be slow (too few resources utilized) sometimes and enterprises need to be guided with a strong vision of the digital enabled future.
A lot has been said about why digital projects fail or succeed. In your view, what are the top 3 factors that never fail to contribute to success to such initiatives?
The first top factor is a strong concrete vision of how the future plant/mine/mill would look like after digital transformation. I am not talking about traditional vague visions but rather detailed imagination of how things would really happen in future operations at the plant and company level. The second factor is customers/users taking outside-in view of the company, operations and offerings. This means focusing on developing concrete values for customers/users and not focusing on systems, platforms and technology with an inside-out view. The third factor is Investing enough to get over the tipping point(s), internal headcounts, partners, development funding and seeing development as an endless journey and a new way of working. Investing too little leads to costs for enterprises and without any tangible outcomes that could fuel further development and the next round of investments. An additional factor is to hire external people with various backgrounds that bring fresh ideas and are not too much occupied in the past ways of doing business.
Have you read or experienced any unique ways to incentivize people towards faster adoption of digital solutions within enterprises?
Personally, I have been involved in conducting reward trips for employees to experience digital in another context e.g. trip to Silicon Valley. Additionally, digital gift cards as a reward (reward digital with digital), making more resources available for people/organizations that want to experiment and be the first ones to try something out are good practices. Essentially, we have to build a culture of rewarding for ‘right behaviour’ and not only for the results achieved.
Please take a look at our short video on the “Future of Mining” enabled by digitization.
Could you share some of your key initiatives that has led to providing tangible returns to business or kickstarted innovations?
My current role at ABB is to lead the way, define strategy, ambassador digital both internally and externally and focus on flagship cases and build capabilities for digital business. I have transformed how we develop things (solutions, capabilities, plans, marketing) from continuous improvement in order to be future mine/mill/plant driven. I have been very instrumental in also forming a culture of envisioning future customer operations and our role in that future. Earlier in my career I had also developed highly concrete new solutions leading to very tangible results such as 4-6-hour doorstep delivery online store, or a key role in transforming printing business from box sales to Managed Print Services etc.