The emperor’s new clothes gets adopted by new industries all the time, and now it’s digitalization’s turn to get naked.
Trigger’s CEO Preben Carlsen has gone from hero status to being ridiculed. Preben and his company have moved from creative (preferably digital) campaigns to strike a blow for sustainable growth in Norway. If Norway is to become sustainable, technological knowledge and understanding is necessary. This includes knowledge about how technology can digitalize entire businesses, how technology should be changed from being an IT tool to permeate through the entire organization's DNA. Private as well as public.
Digitization is not the same as a digital campaign
Digitalization is not about creating a cool website or setting up a blog. It's not about becoming a "racer" in social media or building a creative AR or VR campaign. Nor is it about moving print ads online. It's about surviving in an increasingly technology-driven society, where time and place is getting less and less important. Where your competitors are not in the same city or county as you, but on the other side of the globe.
Digitization is about using technology to make cities that are smarter, more environmental friendly and safer. It's about how technology can help us live longer in our own homes instead of moving to a nursing home or hospital. It's about how technology and huge amounts of data can cure cancer or discover symptoms related to other life-threatening diseases.
In an even greater sense, digitization can be about how we use technology and renewable energy to save the climate and the Earth.
Ask for radical innovation
Innovation Norway writes on 29 May that "Norway needs to innovate radically within the public sector" to maintain the Norwegian welfare. It's about digitalization. To digitize analog, manual, time-consuming and often expensive processes.
When digital managers, who make digital campaigns for a living, talk about digitalization as almost a given, they reveal a lack of understanding for the concept beyond their own industry. Digitization is not the same as a digital campaign provided by a digital media consultant.
10 examples of digitization that do not include a digital media adviser
- Digital warehouse
Komplett.no employs 75 robots that lift a new product every 5 seconds. The robots usually work 16 hours a day. They only take breaks when there are no new product orders or when they need to charge their batteries. Literally.
- Electronic product manufacturing
The robots at the Taiwan Foxconn Factory have replaced 60,000 jobs. Foxconn is, perhaps, best known for producing Apple's iPhone products, but their list of customer also include companies like Microsoft, Amazon, Nokia, and Google.
- Insurance payouts
The Japanese insurance company Fukoku Mutual Life Insurance replaces employees with artificial intelligence from IBM's Watson Explorer AI. A total of 34 economists have been replaced by artificial intelligence that calculates insurance refund payments to the company's customers.
- Robots and 3D-printers to produce shoes
Adidas has begun moving parts of its Chinese production back to Germany but will replace employees with robots and 3D printers. Adidas wants to dramatically reduce "time to market." Today, the process from design to store can take 18 months. With robots and 3D printers, the ambition is to reduce this process so it takes less than a week, and down till it takes just one day.
- Diagnoses through artificial neural networks
Artificial Neural Networks (ANN) are increasingly used in diagnostic systems in the healthcare industry. They are used to detect cancer and heart problems. As a benefit, ANN are not affected by factors such as fatigue, working conditions or emotional state.
- Smart cities
Dubai is going to use digitalization to become the world's most important financial center. Among other things, they will build mountains to create a better climate, produce 3D-printed houses and install hundreds of 3D-printed palm trees that will function as technology hubs with information, charging stations and Internet access.
- Construction robots
Norwegian nLink has developed a robot that will replace human workers at construction sites and drill holes to attach luminaires. Other companies have developed robots that can lay bricks - with extreme precision and at a much greater pace than humans.
- Autonomous cars
9 of 10 accidents happen due to driver failure. Autonomous cars will be equipped to become 100% driverless. Everything from cameras and sensors to artificial intelligence and neural networks. Intel has estimated that a typical autonomous car will generate four terabytes of data in 90 minutes. Four terabytes of data correspond to approximately 670,000 songs streamed via Spotify over the mobile network.
- Customer service
US Servion Global Solutions estimates that as much as 95 percent of all customer dialogues will be conducted by artificial intelligence - and chatbots - by 2025. The analysis company Gartner believes that 85% of customer contact in 2020 will be handled by artificial intelligence.
- Document and contract analysis
The UK based company Cognitive + uses artificial intelligence to automate contract analysis and management. The technology gives businesses the opportunity to automate the legal obligations.
Implementing Changes takes more time than we think
It’s tempting at times to criticize those who are crying “wolf.” Those who emphasize the possible consequences for Norway and Norwegian businesses if they opt out of digitalization unless management and top executives learn to understand technology.
But we hardly notice the gradual changes in everyday life that we supposedly ought to fear. It's only when we look backward that we see how everything and everyone around us have changed at an increasing pace. The stuff of science fiction today will become reality tomorrow and nostalgia next week.
In addition, when the digitalization term is followed by buzzwords like disruption and exponential change, "bullshit bingo" is complete.
This results in chronicles and blog posts-especially from the media industry. The same industry that has proven its inability to keep up with technology development for a quarter of a century.
From limited to unlimited access
Although innovation has moved in a "controlled" pace so far, because access has been limited by high costs, the reality is completely different today. The limitations that we based our business models upon in the past are almost eliminated. Today we have access to information worldwide through the Internet. Data power from the Cloud is virtually unlimited, and, with smartphones and social media, we have access to an ever-expanding global market. And it's almost completely free.
The consequences are lower transaction costs and less friction. The man in the middle, however, gets hit the hardest, and the employees are downsized. If a high-cost country such as Norway doesn’t follow and digitize manual and expensive processes, our trading partners will no longer be interested in our products, goods or services. We can no longer do business If the costs are higher than the revenue. Or manage the country. The oil has been - and will remain for several years - our savings account, but it won't last forever.
Norwegian executives are technology-weak
It's a well-documented fact that Norwegian governors and senior executives are weak when it comes to technology. It's not about not using social media, or blogs, or that they haven’t learned about content marketing and native advertising. It is the fact that they don’t understand that today’s business models have to adapt to everyday life, which is becoming more and more digital. Processes and functions will in the future be permeated by technology in one way or another.
Campaigns and business models
When digital advisors argue with Preben Carlsen about the lack of specific advice, it's because no business or industry is the same. For a digital adviser, who only transfers print ads to an online platform it doesn't matter what industry it is. However, digitalization of a business is (unfortunately) about so much more.
As a senior manager, I would not go to a digital agency for advice on how to digitalize the business. Just because you come home with a new digital campaign in your suitcase, doesn’t mean you have digitalized your business.