Today: Teams, tomorrow: transformation

At Copenhagen Business School, digitalisation has always been a key part of the MBA syllabus as we have long understood that its impact will be far-reaching and transformational for businesses in every single sector. But when the coronavirus pandemic struck, many companies got a real-life lesson in the potential of the digital world and perhaps an insight into the opportunities it can uncover.

“Certainly, what lockdown has done is to catapult us three-to-five years into the future,” explains Professor Stefan Henningsson of the CBS Dept of Digitalisation. He teaches the Concentration in Digitalisation to MBA and Executive MBA participants. “Before the pandemic, activities in firms became digitised because of efficiency and quality improvements. Now, they have been digitised because there was no alternative.” There’s perhaps no keener example of this than the move to Teams and Zoom in the absence of face-to-face contact, but Professor Henningsson believes that there’s much more to come.

“What we have witnessed is the basic conversion of analogue activities to digital activities, but we have generally not changed the way we work (design, produce, sell) to tap into the unique possibilities with the new omnipresent digital technologies. And this means that there is a huge untapped digital potential to transform business. The companies that want to come out on top in the ‘new normal’ should not simply convert an activity into digital, but put it into a broader transformation.”

These sentiments may be familiar to many in the business community already, but there’s been a reluctance from many offline sectors to fully embrace digitalisation. What opportunities are at-hand for an essentially offline company that makes ‘widgets’, for example?

“OK, let’s take a look at a Danish company that produces small plastic components,” says Professor Henningsson. That is essentially what LEGO is, after all. The company has always been known for its command of the supply chain and production, but that wasn’t enough to prevent an 8% decline in sales in 2017 as children moved to more modern toys. How to fight back? A firmer focus on digitisation, including putting VR and AR into the brick set, merging play with social networks and adapting its model to meet customers through digital channels. This all came together to put LEGO back on its steep growth trajectory.”

It’s worth noting that digital transformation doesn’t necessarily require an overhaul of the entire business model; rather, the introduction of a digital component embedded within the business. “Frankly many of the people a company needs will already be there, but there is often a gap in digital skills. Lego still needs designers and creative people and manufacturing teams, but they have augmented that talent with people well versed in leveraging digital technologies.”

Once the right people and technologies are in place, the next challenge is to spot and exploit available opportunities. Copenhagen-based Queue-it, which provides software that prevents website crashes by controlling traffic, has done just that. The company’s co-founder, Niels Henrik Sodemann, is a CBS alumnus. “I completed my Executive MBA in 2003, and back then Digitalisation was a key part of the syllabus. We could see that cloud computing was the emerging technology and realised that we could scale a business in an instant by renting just the storage we needed – without having to pay for expensive servers.”

“However, we know that success is built on the entire business toolkit that CBS provides. One part of that toolkit relates to how you identify and react to different scenarios and at the start of this year, one of our team members who works in the Asian markets noticed that people were starting to buy facemasks more frequently than usual. We watched what was happening closely and when the first lockdown happened in China, we were ready to approach supermarkets in the West with our solution. We were ahead of the curve and our instant digital scalability made it easy to onboard tonnes of new customers who were about to face unprecedented numbers of online shoppers.”

Across the world, business change is happening and digitalisation is the driving force behind it. Professor Henningsson says: “Now it’s about thinking laterally and leveraging the insight you’re getting from the technology within your organisation – or applying that technology in new ways. You’re taking Teams meetings now, but could you record those meetings, edit them and use them to streamline your training or onboarding, for example? Or could those resources be worth anything externally? At CBS, we can see that companies are now asking how their new digital technologies could allow them to work differently; it’s an exciting time.”