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How a Strong Corporate Culture Helps Firms Succeed with Digital Transformation

Steinbeis experts examine agile teams at SMEs as part of a pilot project

The Ferdinand Steinbeis Institute (FSTI), Steinbeis 2i, and bwcon have joined forces with a variety of business partners as part of a project called Agile Teams – Factors Driving the Success of Cross-Company and Cross-Industry Collaboration in Digital Transformation. The pilot project is being funded by the Baden-Wuerttemberg Ministry of Economic Affairs. The focal issue of the project is how companies should support a corporate culture that allows them to succeed not just within value creation networks, but also with business partners in other industries. As part of the pilot project, an agile team has been providing insights not only into the corporate culture at d-serv, but also the firm’s successful partnership with the Stuttgart-based company Koenig & Bauer MetalPrint. 

The era of closed commodity cycles ended many years ago and the world of business is becoming increasingly complex, networked, and digital – as is life outside work. But how should companies deal with this complexity? Or indeed are there ways for firms to use complexity to create new value? When a company is finding it difficult to unleash innovative capabilities for itself, under its own steam, it makes sense to turn to networks. Value creation networks are cooperative ventures that allow their members to pool strengths, individual resources, and innovation capabilities in order to create value as an alliance.

The influence of corporate culture on the success of alliances

This all sounds simple in principle, but it is fraught with obstacles. Organizations are idiosyncratic by nature, i.e. they have their own culture. As a result, corporate cultures can prove to be an obstacle when it comes to collaborative projects, although they can also act as a catalyst. To find out how to foster the right culture within companies for partnerships to succeed in value creation networks, bwcon joined forces with the Ferdinand Steinbeis Institute, Steinbeis2i, and the Baden-Wuerttemberg Crafts Congress. Together, they organized and conducted a pilot project which is being funded by the Baden-Wuerttemberg Ministry of Economic Affairs and goes by the title Agile Teams – The Success Factors of Cross-Company and Cross-Industry Collaboration in Digital Transformation. The aim is to determine different ways to promote the development of corporate cultures at SMEs such that people are enabled and motivated not only to enter into cooperative ventures in times of digital transformation – even with heterogeneous partners from outside their industry, sector, or field of technology – but also to develop complex products and services within networks.

d-serv – agile team, compatible corporate culture

One of the agile value creation teams involved in the project is d-serv. For the experts at Steinbeis, it was clear from the moment the project kicked off that the culture of the company was characterized by mutual trust and a shared interest in identifying the best possible solution to what was a challenging task. To lay a foundation for successful innovation and collaboration, it is crucial for companies working together to have compatible corporate cultures, especially in heterogeneous value creation networks. “We see corporate culture as the link between individual employees at our company and the people at the organization acting as a vehicle in enabling delivery. Among other things, the corporate culture includes values, communication, people’s understanding of quality, aspirations, and collaboration,” say Ugur Cetin and Pietro Triscari of d-serv. When opening up new fields of business it is important to be able to draw on a solid foundation of trust and a common language that fosters openness with other team members, partners, and customers. The aim is to forge networks between customers and experts in order to come up with new solutions. How this works in practice, and the role played by corporate culture, are demonstrated by the actual example of an alliance with the Stuttgart-based company Koenig & Bauer MetalPrint (KBA).

When a problem becomes a solution

KBA is an international machine and equipment manufacturer. Its production lines are used to coat and print sheet metal packaging, such as food cans and chemical containers, and its solutions are used in factories worldwide. A crucial aspect of installing and commissioning production lines is how well information is logged by service technicians on site and how this information is managed and administered after installation. For example, one key challenge is that production lines are often set up in locations with unsuitable IT infrastructures. In other cases, there is no access to computer systems due to corporate guidelines laid down by the customer.

A workshop was organized with KBA in which the d-serv experts worked up the requirements for a tool that would support service technicians in carrying out their work. The tool had to be capable of working independently of head office and without regular internet access, based on a standard process that would allow project and site data to be shared as efficiently as possible with central systems. Using a process chart, critical process steps were identified and agreed with different user groups. After analyzing requirements, the team decided to introduce IQM Platform, a web-based database that has already been used for years in construction and plant engineering and could be adapted to KBA’s requirements. The pilot system has already been used for existing projects and introduced to new projects involving different user groups and locations.

The Steinbeis experts and their project partners have compiled a catalog of measures based on insights gained during the Agile Teams pilot project. Their catalog also includes different tools and concepts so it can be used during subsequent projects in areas beyond the field of corporate culture.

The catalog of measures compiled for the pilot project can be found at https://bit.ly/2ThPR7m (German only).

“Skills are not the only bottleneck when it comes to change; the more critical issue is SMEs’ willingness to embrace change.”

An interview with Tolga Turan, Director of Project Management at Koenig & Bauer MetalPrint

Hello Mr. Turan. How important do you think digital platform solutions are for SMEs in general, but also in particular for machine makers and plant engineers?

Digital platforms are an opportunity for SMEs to participate in the development of different business models and processes, or to tap into new models. The charm of digital platforms is that solutions evolve through in-depth collaboration with large, financially powerful enterprises; they merge with the standard product of the platform provider and this makes them available to any other company. This is particularly valuable for medium-sized machine makers and plant engineering companies. The processes and tasks are highly complex at industrial enterprises, although there are also similarities, so the requirements when it comes to digital technology are comparable. But also, in this era of information the knowledge firms require can be found in lots of places, so when it’s needed, it can be bought anywhere. The next big boost to the international competitiveness of medium-sized enterprises will be increased efficiency through platform solutions.

Have German SMEs prepared properly for change? What skills do companies need to cope with this change?

Just like any change, you need to reach a critical mass of 15 to 20% to open the door to others. The impression I get is that for change to happen, it’s not skills that are the bottleneck – you can buy in know-how from consultants. The much more critical aspect is the willingness of SMEs to embrace change, because without changing setups and organizational procedures within companies, digitalization usually results in information not being captured on paper anymore but simply being disseminated around the company in PDFs or automatically generated emails. Digital transformation only brings out hidden potential by making sweeping changes.

How important is corporate culture in this respect, especially when introducing digital platform solutions?

Extremely important. It’s only when corporate culture focuses on making things better and there’s a culture of failure that staff are able to explore new avenues when it comes to thinking about things, expressing things, and trying things out.

Would this concept also be suitable for other businesses or platforms?

I strongly believe that this solution would be desirable for other companies, and we’re noticing this from discussions in our own industrial networks.


Authors Article

Dr. Michal Ortiz (author)
Senior Research Fellow
Ferdinand Steinbeis Institute (Stuttgart)

Johanna Pabst (author)
Organizational support
bwcon research gGmbH (Stuttgart)

Ugur Cetin (author)
d-serv GmbH (Tübingen)

Pietro Triscari (author)
d-serv GmbH (Tübingen)

Author Interview

Tolga Turan (Autor)
Director of Project Management
Koenig & Bauer MetalPrint GmbH (Stuttgart)