Mastering the digital transformation with full speed

Michael Zettel, head of Accenture Austria, talks about successful digitisation, challenges and why we are where we are.

The digital transformation is often compared to the great inventions and their effects on society. For example, the development of the printing press in the modern era or the steam engine in the mid-1800s. The fact remains that the digital transformation is a technological development that will turn the existing economic, political, social, societal and scientific world upside down. This offers up new opportunities but also brings challenges, allowing for new scopes of action and also making structural changes necessary.

For the digital transformation it is not enough to simply have access to new technologies but to also use them as a modern society – jobs, leisure time and knowledge are determined more and more by digital applications – emails, messengers, browsers, AI, chatbots, augmented reality and so on. Thanks to digitisation we are able to work, study, teach and research largely independent from time and place.

But it also remains a fact that the Covid pandemic and the ensuing lockdowns pushed digitisation right into everybody’s attention. The pandemic five years ago would have been kind of manageable with lots of effort and more debts. But ten or even twenty years ago? A horror scenario we can’t even begin to imagine…

But what does successful digitisation mean? We spoke to digitisation pioneer Michael Zettel, Country Managing Director of IT service provider and consultant Accenture Austria.

Some people consider their business successfully digitised when they check their emails on the smartphone, others when an AI is organising production and at least two of their machines can communicate via 5G. Who is right? No one. “Successful digitisation” means that all processes – from sales to production and service – are largely automated. Those who are “successfully digitised” don’t sell simple products or services, they sell smart products and digital services. The majority of Austrian companies are right in the middle of the digital transformation – but on many different levels.

The trailblazers are already far advanced and in particular many medium-sized companies are catching up now. We described the levels of digital transformation in a study together with the Federation of Austrian Industries: Stage 0 is “digitally blind”. The majority of data storage and information transfer is done on paper. Stage 1 means “digital mapping” – IT is used as a tool for work. Stage 2 is called “act digitally’’. These companies use their data, have digital process optimisation, but humans still make the decisions. Stage 3, the final stage, stands for being

© Michael Inmann

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“digitally autonomous”. Data-based products and services are sold, all processes are automated and based on data, decisions can also be made automatically. Digital business models are found in this stage.

How would you describe “successful digitisation”? Would you apply this term to Austria? As I said before, when a company has reached level 3 it will have achieved successful digitisation.

Like all countries, Austria is at the beginning of the digital transformation. But we have great prerequisites to become digital champions. Right now, it is all about digitising the industrial sector. And we are world-class in terms of industry, maybe even world champion. We need to use this know-how for digital transformation. We must not rest on our laurels; we have to step it up – right away.

What are we lacking? We do have a lot: successful businesses, hidden champions, a stable political environment and excellent education facilities. But we often lack courage. In addition to know-how and expert knowledge we also need the right mindset. And we need the skills to go with it. We need to believe in ourselves and keep an eye on our goals. This is the main challenge that we have to overcome.

Is the leftover attitude from the Austro-Hungarian Empire of “that’s how we’ve always done it” and “who do you think you are?” still in the heads of people who decide upon digitisation? Or, speaking in nautical terms, how can we excite a hydrophobic landlubber for a speedboat? Unfortunately, yes. This type of mentality is very persistent – even 200 years after Count Metternich in the 19th century. We saw particularly now during the Covid pandemic that Austrians

like to go back to the tried and tested. We have an Anti-Covid App but the newspapers were full with articles asking “who took the train from Graz to Vienna on Thursday at 2.23 pm?” We need to highlight to people the benefits of digitisation much more clearly. We need to remove their “fear” of technology with transparency and education. The challenge is to show the benefits and thus create trust.

Which Austrian company has tackled the digital transformation best, in your opinion? There are a number of leading businesses that have chosen good, courageous and successful paths. There are a few examples, such as the online banking platform George by Erstebank, Donau Insurance, RHI and OMV. And these are only a few of those who made waves with their digital transformation.

My business is running well, the figures are good – why should I still invest in digitisation? And how do I do that? That is quite easy to answer: Every investment is proven to lead to more growth in turnover and an increase in productivity. If I want to have success tomorrow, not just today, I need to invest into new technologies. It does pay off – for every type of business. We said it seven years ago in our Tech Vision, which looks at trends for the next five years: Every business will become a digital business. And that’s what happened today. There are only very dew doubters left. A tradesman or a hairdresser, too, can make a significant difference with the right use of technology.

The digital transformation takes place in several phases. A company needs to become digital step by step in a clever way. The company, the organisation, needs a digital heart. Then the periphery, such as customer care, needs to become digital. That is a successful way to do it.

The Covid pandemic allegedly triggered a boost in digitisation. Is that true? Is a “digitisation boost” actually the right term to describe schools having online classes, pupils getting their homework via WhatsApp and – to exaggerate a bit – every other Austrian household with at least three people in employment or school lacking at least one PC or laptop? I’m under the impression that this is not really the digitisation that is going to generate economic growth in the future. The Covid pandemic was a digital litmus test on the one hand, and on the other hand we saw what we could do and what not. Communication foremost has become digital. But screens and keyboards have their limits.

Critics cite cybercrime and insufficient data protection as the Achilles heel of digitisation. Is that an exaggeration or does this claim contain a speck of truth? Cybercrime is definitely a challenge, like any type of crime. When it comes to data protection, Europe is making life hard for itself. The killer phrase is the “so-called consumer protection.”

Michael Zettel on how to achieve digitisation: “The company’s core must be digitised first. The company, the organisation, needs a digital heart.”

Yes, data protection is one of Europe’s assets but it is also a self-built hurdle. The United States and China are making the best of their advantage in this regard. This damages our economy and our society.

You have written an entire chapter on data protection in your book “The digital economic miracle”. Why do most Austrians have such an issue with data protection? On the one hand, the most unusual terms and conditions are consented with an “okay”, personal data and pictures are put voluntarily on social networks. But on the other hand, useful digital achievements such as the electronic health file and the Anti-Covid-App are often attacked with truly idiotic statements. If you allow me to put it bluntly – are we really that stupid? It is quite unbelievable, what is missing? Education in general? A lack of communication? We maybe aren’t stupid but we have not been “sold” properly? There is a high level of scepticism when it comes to technology in Austria. Sometimes it is even hostility towards technology. This is something we saw quite clearly during the Covid pandemic. Covid was a catalyst in this regard, too. To me, the key answers are educating people better and creating more trust. We need to inform people about technology and its benefits, we have to make it more transparent as this transparency is the basis for trust. I think and hope that this will lead Austrians closer to technology.

A final question, Mr Zettel: The digitisation fairy is stopping by, what do you wish? A different mindset, openness, courage and an acceptance for change and advancement. We also need political willingness to push this. The state needs to be a trailblazer and invest ten billion euros into the digital transformation of the country. That’s what I would want from the digitisation fairy. ◆

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Browsing through the technology gospel

World Champion Austria read the book “The digital economic miracle – Austria’s way out of the crisis.”

Adigitisation expert turned book author writes a love letter to digitisation. You might call Michael Zettel a digitisation evangelist. “Entrenching technology in the economy” motivated him to study business informatics at the Vienna University of Technology and at Leeds University. Zettel wants to make Austria’s companies and organisations trailblazers of digital transformation. Let’s stay with the term “evangelist”: Michael Zettel spreads the gospel of digitisation and the book’s blurb already gives a hint:

“The Covid pandemic was the litmus test for Austria. Working from home and digital business models had to work. New technologies created the resilience we needed. Digitisation is the vaccination against the economic Covid crisis. We can promote sustainable wealth and a sustainable economy thanks to new technologies. Austria has excellent opportunities to become a champion in digitisation.”

AI is only mathematics

“The one technology that Austrians seem to be most afraid of is artificial intelligence (AI)” … … “In addition to being a technology, AI has become a hype and a myth. A myth with the air of being a job killer. AI is something menacing in public discourse. Hollywood has contributed to that. The bogeymen of artificial intelligence are half-man-half-machine mutants such as the Terminator. But as usual, Hollywood’s fantasy is far removed from reality.”

Covid as a litmus test

“It was the litmus test for our businesses. The subject: digitisation. 16 March 2020 was the digital litmus test. The lockdown showed very quickly who stood where in the race for digital transformation. Who had already transformed his processes and business fields and who would be successful in the new environment. Being offline was out.”…

If artificial intelligence had always had a cute face, the general acceptance for AI would be much higher.

… “Technology changes our life. That’s no secret. We won’t be able to stop the triumphal procession of digitisation in Austria – even if we wanted to due to inexplicable reasons. It is our choice to use digitisation or to fight it. But fighting against one of the most deep-lying changes and developments in our economy and society reminds us of Don Quijote.”

Data protection as a growth killer?

“Data is the ‘new gold’ or the ‘new oil’ – these and similar comparisons have one issue: They don’t hold up. Data is not simply a resource. The part that is our personal data is part of us and our technological identity, respectively. This makes data so valuable and means that those who use it need to assume responsibility”… … “Data protection is seen in Europe foremost through the lens of consumers. The basic idea behind the General Data Protection Regulation (GDPR) was to give customers their sovereignty over their data back, which is fundamentally commendable and understandable. But if companies have to seriously consider whether to stop having emails as a means of communication because it might violate data protection, then the regulation’s implementation is a catastrophe we need to question.”

Digitisation as an economic driver

“An analysis of the European Commission shows the role that data is now having on the economy and which significance it will have in future. The Commission believes that by 2025 already more than four percent of the EU’s GDP will be generated by data economy.”… … “Big data, cloud computing, artificial intelligence: We are currently seeing the most comprehensive transformation of our economy in the last 30 or 40 years. Technological developments impact companies to a tremendous extent. Technology has never been as relevant for the success of a business model – and for a company’s survival, as the Covid pandemic has shown.”… … “The path to a digital future will lead us through uncharted terrain but not through a jungle.”… … “The question is, how can we achieve the digital transformation.” ◆