Human Centric Digital Transformation, Leadership and the ...€¦ · Human Centric Digital Transformation, Leadership and the Future of Work Fujitsu Research Institute Dr. Martin

Human Centric Digital Transformation, Leadership and the Future of Work

Fujitsu Research Institute

Dr. Martin Schulz [email protected]

2017.05.08

1 Copyright 2017 FUJITSU

Outline

“Great things are not done by impulse,

but by a series of small things brought together.”

George Eliot (pseudonym for Mary Ann Evans)

Digital Transformation – Challenge and Opportunity

Leadership - During Complex Change

Future of Work


Digital Transformation



From Digital Transformation to Industrial Revolution

http://www.google.co.jp/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjn-5_8jsbTAhVGybwKHVxQDzYQjRwIBw&url=http://journal.jp.fujitsu.com/en/2016/01/12/01/&psig=AFQjCNHPNyOhvZZEFxOOLbmshGD0f6qr8w&ust=1493433223198295


Industry Platforms Smart Factories

Mfg.

20%

Industry (4.0) Strategy between Revolution & Evolution

7% Consumer

29%

13%

Consumer

Platforms Global User Access, Markets, Standards,

New Business Models

Smart

Automob.

1.5%

Smart

Machines

2.2% Smart

IT

1.2%

Smart

Agricult.

1.2% Smart

Chemical

2.2%

7% 7%

Retail Transport

Healthcare

Government

4% Utilities

Internet of Services Partner Ecosystems

Internet of Things Device Integration

IoT Market Shares

Source: Data from IDC, Fraunhofer (2014)

IoT & Industry 4.0 Strategy Security, Standards, Infra., Cooperation

I40 Productivity

Growth

2010 2018

IoT Market “Revolution” +20% YoY (Market Size)

1970 2030

I40 Market “Evolution” +1.5% YoY (Value Added)

Source: Graphs: Acatech, Siemens.


Industry Digital Penetration Perception (% Sector Respondents) Average (37%)

Source: McKinsey (2017)

US Top-10 Public Companies (Market Cap.)

Platform-Business Companies (50%)

10% No change

40% Minor secondary change

60% Some core change

84% Reaching Mainstream

Mostly Digitized

Automotive

Consumer

Goods

Finance

Prof.

Service

Telecom

Travel

Transp. HiTech

Retail Media

Japan UK US Euro Z. China

Consumer

Finance 25 14 14 10 8

Payment 24 24 17 18 9

Asset

Management 22 22 17 17 4

Deposits 5 5 4 4 1

Corporate 1 1 1 1 1

Digital Revolution Impact in Finance

Margin Reduction (%)


Digitize…

but it costs you!

It’s late…

… not too late!

Messages:


The Dark Side: Restructuring Markets, Work & Incomes

Note: 2000 =100, based on compensation in euros.

50

70

90

110

130

150

170

2015201320112009200720052003200150

70

90

110

130

150

170

20152013201120092007200520032001

Services

Manufacturing

Japan -> Regulation

50

70

90

110

130

150

170

20152013201120092007200520032001

Services

Manufacturing

50

70

90

110

130

150

170

20152013201120092007200520032001

Services

Manufacturing

Services

Manufacturing

Germany -> Globalization UK

US

Labor Compensation by Sector (2000=100)

7 Copyright 2017 FUJITSU Source: Ameco Database (2016), Saez (2016), Rosengard (2017).

US - Trump:

“Make America

Great Again!”

UK - UKIP: “Controlling our own borders, making our own laws, running our own country!”

Source: Bloomberg

Source: www.donaldtrump.com

US unemployment rate 4.7%, but 7.9% for below high school educated workers

US unemployment rate of involuntary part-time and marginally attached 9.3%, and 24.2% long-term

US 2009-2015: bottom 99% real income growth +7.6%, top 1% +37.4%

Voters Suspect Globalization, NOT Technology as the Villain


What is going on?

Lessons learned in Japan: Growth Slows with Ageing


0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

19

90

19

92

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96

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98

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00

20

02

20

04

20

06

20

08

20

10

20

12

20

14

20

16

Emerging

Markets

Other Mature

US

World

Potential Growth Rates (%) Labor Productivity Trends

Japan

Note: 10y moving averages. Source: IMF-WEO; OECD (2016). Note: Linear Trends. Source: Data from Conference Board (2016).

9

“New Normal” of much lower growth: Social ageing slows demand and innovation (Schulz)

New technologies are innovative, but not really revolutionary or efficient (Gordon)

Growth and Productivity have been Falling Everywhere


45

50

55

60

65

70

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

2045

2050

Germany

Japan

China

United States

Japan Bubble

Lessons Learned in Japan: Social Ageing Affects Growth

Source: Data from OECD.

9.9% 4.5% 1.2%

% W

ork

ing A

ge

Po

pu

latio

n

Japan GDP Growth

Working Age Population (%) and Economic Growth (%)

China

7%-> 10.2% 5%


90

95

100

105

110

60

70

80

90

100

110

120

130

140

1981

1982

1983

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2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Household Demand Shifts to (Social) Services and Lifestyle

Source: Data from CEIC.

Household Expenditure (1996=100)

Apparel

Housing

Household

Demand

(right scale)

Transport, Communication Furniture etc.

Medical Care

Note: 5-quarter moving averages. Corrected by changing household size.

Index Index


17

19

21

23

25

27

29

31

33

35

37

1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010

Corporations Shift to New Levels of Efficiency

Source: Data: World Bank (2015), CEIC 2015.

Gross Investment Rates (% GDP)

Long investment deleveraging resulted in depression and deflation

Convergence of highly efficient investment in the “new normal”

Note: Gross Fixed Capital Formation % of GDP.

USA

Japan’s Bubble

Japan

Germany


7.202 2.050 1.724 1.961 1.720

5.871 7.086

9.223

7.206

2.026 2.150

2.173

1.715 6.231

5 - 14 25 - 34 35 - 44 45 - 54 55 - 64

Source: Puls(2015); Statistisches Bundesamt.

Vocational

Training

No Qualification

University

Germany: Qualifications by Age Group (1000 Employees)

Missing Workforce

(46% less than 1975)

Qualifications by Age Group (1000 Person)

Missing Trained Workforce?

(66% less than 1975?)

3126?

A Key Challenge will be Missing Work Skills: Germany



Digital Transformation … how it might work


Digital Strategy - Transformation at 3 Levels

Fujitsu Technology and Service Vision (2016)

https://www.fujitsu.com/sg/Images/FTSV2016_Book1_2_EN-1.pdf


Start of Digital Transformation: Traditional Behavior

Fujitsu Retail’s Jat Sahi (2016) – Creating a Digital Culture

Jat Sahi (2016) – Creating a Digital Culture; https://image.slidesharecdn.com/bos357creatingadigitalculturefinal-161117155938/95/creating-a-digital-culture-22-638.jpg?cb=1479398442

Top-down management, setting goals

Transforming diverse internal systems

Diverse communication, inflexible cooperation

Defined performance and profit targets

Avoid mistakes!


Transformation … often does not seem to work this way

Source: Fujitsu (2016) – Walking the digital tightrope – Exec Survey.

Corporate Executives: Digital transformation projects are a gamble...



Leadership – During Complex Change


Digital Transformation Leadership – During Complex Change

Analyze: Challenges

Companies challenged

Jobs are threatened

People feel vulnerable

Government clueless

Think: Transformation

Where are your company’s strength?

Which processes for new solutions?

Think global act local

Collaborate

Change: Digital

Leverage digitally

Train & Transform

Communicate & Visualize

Engage, support communities

See Feel Change

Direct the Rider Follow the bright spots

Script critical moves

Point the direction

Motivate the Elephant Find the feeling

Shrink the feeling

Grow your people

Show the Path Tweak the environment

Build habits

Rally the herd

https://www.scrumalliance.org/community/articles/2014/march/change-management-models Chip Heath and Dan Heath “Switch: How to Change Things When Change Is Hard”

“Switch” Framework

https://courtneemason.files.wordpress.com/2015/01/switch-elephant_rider_path.jpg


Digital Transformation at Stockmann Department Stores

https://www.slideshare.net/FujitsuTS/digital-fitting-rooms-making-shopping-smooth-at-stockmann

https://upload.wikimedia.org/wikipedia/commons/thu

mb/b/bd/Stockmann%2C_Helsinki_2013.jpg/1200px-

Stockmann%2C_Helsinki_2013.jpg

Elina Savolainen (2016) Senior Development Manager

The Digital Fitting Room

Stockmann (Helsinki)


Stockmann Department Stores – Diverse Technologies


Continuous learning – new processes for new solutions

Open communications

Cross-organization team

Co-creation with customer

Keep it simple

Eat the elephant


Stockmann Department Stores – Digital Fitting Room


Barcode scanning of lingerie in the fitting room to order other sizes or colors

Small pilot starting in Helsinki

30K budget including software and devices

86% positive feedback


Fujitsu’s Jat Sahi: It’s all about Online and Offline Blending…

https://image.slidesharecdn.com/bos409-digitalretailing-lessonsfromtheshopfloorfinalv20-161117160415/95/digital-retailing-lessons-from-the-shop-floor-16-638.jpg?cb=1479398813


Digital Innovative Behavior: Do it like the Millennials Do

Jat Sahi (2016) – Creating a Digital Culture; https://image.slidesharecdn.com/bos357creatingadigitalculturefinal-161117155938/95/creating-a-digital-culture-22-638.jpg?cb=1479398442

Set a purpose, not a finite vision

Look at processes, roles, systems and events – what thinking do they encourage?

Find communities ready to grab and support (digital) value creation

Make digital values highly visible

Face the challenge!

Fujitsu Retail’s Jat Sahi (2016) – Creating a Digital Culture



Future of Work – From Human Resources to Human Capital Management


Digital Transformation - Human Capital Management

SAP SuccessFactors

Talent Management

Fujitsu MetaArc Fujitsu Global HCM


Digital Transformation – Connecting the Millennial World

Cloud-based HR

Talent Management

Universities Consultants Partners


Lifecycle Learning - Basis of Human Capital Development

Chart Source: BIBB (2015) – Toolbox berufliche Weiterbildung in Betrieb; Fraunhofer (2011) - Karrieresysteme

Performance

Time

Study

Training Master

Certificate

Career Change

Part-time

Integration

Parenting

Re-Integration On-the-job

training

Retaining

Employees

Continuous

Qualification

pment Professional Development

College<->Business

Cooperation

Certification

Training Centers

Online MBAs

Vocational Univ.

Telecommuting

Part/Flex Time

Skill

Management

IoTS Learning

Services

Open

Universities

Part-time

Consultants

Training

Individualization

10% Formal 20% Informal

70% Professional Development

Corporate

Talent Management

Lifelong Learning

Personal

Training Accounts


Old<->Young Skill Transfers are Key to Innovation

Learning + experience

leads to innovation and

growth

Old > young

innovation turns to

“sophistication”

Continuous innovation =

continuous learning,

skill management,

change -10

10

30

50

70

90

5

7

9

11

13

15

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23

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0

10,000

Patents etc. %

Total

Population

Source: Data from UN, WIPO.

Note: UN Population Statistics estimates and low-fertility model. WIPO statistics for 1885-1979 and 1980-2014.

15-24 Old Population

50-59 Old Population

Patents, Trademarks, Designs, Models

Patents Innovation “Hump”

Japan Working Age Brackets & Patents


Tokyo Household Challenge: Digitalize Granny

Management:

Working mother & father (mostly useless)

Team: Yui (Year-5 kid and IT specialist)

Granny (84 year old technology deconstructor)

Technology: Apple iPhone family account

Solution: Family photo account with active posting

Regular, short “hackathons”

Lifelong Learning and the Generation Mix


Hasso Plattner Institute (HPI) Potsdam: Design Thinking

Multi-Disciplinary Teams

Source: HPI (2016)

https://www.google.co.jp/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwjXp5um8ovPAhUB82MKHTdTBooQjRwIBw&url=https://www.linkedin.com/pulse/design-thinking-business-strategy-customer-centered-kosasih&psig=AFQjCNFyp_mm9OfsykjJEVRxMrioQYYojw&ust=1473840533217947


Fujitsu Innovations for the Future Workplace

Today

Clean Desk Flexible

Ergonomic

Two or one cable option

Supporting Shared Desk Scenarios

Tomorrow

Wireless Desk Wireless Docking

Wireless Charging

Increased Flexibility and

Ease-of Use for

Shared Desk Scenarios

Outlook

Office of The Future Interactive Working & Sharing

Highest Workplace Protection

Technology Demo


Is it all virtual now?

https://www.slideshare.net/FujitsuTS/the-future-workplace-will-yours-be-humancentric-55405697

Fujitsu Global Clients & Datacenter’s Christian Bock (2015) – The Future Workplace


Future of Work - Thinking it through

Corporate Progress

Shared Results

Complex Systems

Individualized Environment

Full Potential

Corporate Success

Profit

Simple Systems

Complex Indiv. Environment

Max Performance

Performance

Evaluation

Quantification

Success

Skill Development

Employee

Max Performance

Specialist/Generalist

Promotion

Team

Full Potential

Professional

Growth & Experience

Talent Competition (HRM)

Potential

Coaching

Assessment

Learning Integration

Excellence

Talent Development (HCM)

“Lifecycle”

HCM

Transformation

Traditional Competition

“+5% Income”

Digital Potentials

“+1% Productivity”


Documents

Human Centric Digital Transformation, Leadership and the ...€¦ · Human Centric Digital Transformation, Leadership and the Future of Work Fujitsu Research Institute Dr. Martin