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Best Practice 1| 2015
BEST
PRACTICE.
wirtschaftswunder 4.0
CIO Talk with Continental
digital driving
Heineken CIO interview
salesforce
robotics
Issue 1⁄ 2015
germany is going digital.
on its own terms.
we used to
call customers
john doe.
nowadays,
we call them
ana lytics.
wirtschaftswunder 4.0 – digitalization made in germany
Wirtschaftswunder don’t just happen – they take a lot of hard work.
However, the digitalization of Germany can provide the next “Wunder”.
To ensure that our economy remains competitive in the future.
Let’s make it happen together: www.t-systems.com/wirtschaftswunder
EDITORIAL
—3
WIRTSCHAFTSWUNDER 4.0
– DIGITIZATION MADE IN
Photos: Mareen Fischinger/Deutsche Telekom AG
GERMANY.
Melitta coffee filters are experiencing a come-back in the USA and
shoppers in Chinese stores are making a bee-line for Solinger cutlery. This drives the message home: the ‘made in Germany’ label
still has real impact – worldwide. Even in countries outpacing us
in terms of digitization, the products we make are held in high
esteem. But which industries benefit the most? Which items have
fully exploited their potential in the digital age? We Germans dozed
through much of the first half of the digital era. Which is no surprise really because, led by consumers, the first wave primarily
affected retail. And if we’re honest, marketing, sales and services are not our strongest points. We are much more at home in the
worlds of construction, manufacturing and engineering. They’re
what we are good at.
So how can Germany get onboard before the second digital
wave gets underway? This time, in addition to retailers, and music
and book specialists, there are other players on the field. Digitization is pervading sectors that are the heavyweights of our economy: plant and general engineering, heavy industry, consumer
goods, pharmaceuticals and chemicals. These are our true fortes,
accounting for annual exports to the tune of 285 billion dollars –
the highest in the world.
The conviction of our politicians in Berlin that a Wirtschaftswunder – a digital economic miracle – is on the cards comes as
excellent news for manufacturers. But as Chancellor Angela
Merkel asks: “Will it take place in Germany?” Economist Rainer
Drath observes: “Asian companies are influenced by what goes on
in Europe, where our strengths lie in standardization and connectivity. Americans, on the other hand, are self-starters; they set to
work even before the standards have been defined. We Europeans
tend to hesitate before taking the plunge.” Yet it is time to stop
dithering, and flex our muscles in standardization and integration. Because then, and only then, can Europe and, in particular,
Germany be in with a chance of translating its highly respected in-
dustrial prowess into marketable digital business models – in the
form of Industry 4.0. The cloud, mobility and analytics solutions
will drive this digitization. But to master these in the B2B space,
businesses must take a holistic approach to transfomation. And
they must demand quality – from their IT providers, for instance.
Organizations should ask for nothing less than the best networks,
first-rate platforms and the highest levels of security. As IT, telecommunications and production converge, manufacturing industries
can make a real difference to the future. A study by McKinsey highlights exactly what is at stake: by incorporating the Internet into production processes, the German economy alone could grow by 207
billion euros by 2025. But if the transformation fails, the same
amount will be lost.
It is encouraging to see that an increasing number of our customers are adopting a two-speed IT strategy – subdividing their
team to accelerate digitization. While the traditional ICT department tackles routine tasks and delivers stable operations, its digital
counterpart focuses on disruptive technologies and integrating
them into innovative business models. As an ICT provider, it is only
logical for us to take the same approach. In fact, we are going
one step further: from now on, we will have three operational units
for our corporate customers: the Digital Division, the IT Division
and the Telecommunications Division. Driving standardization,
automation, quality and efficiency in IT infrastructures calls for different skills and processes from those required for digital business
models or telecommunications. Each division focuses on a dedicated area of growth – from development, to sales, to delivery of
end-to-end services.
Economic miracles do not happen overnight. They are the result of hard work, and require us to look at the world in a new way.
Best regards,
Reinhard Clemens
INTRO
—5
Facebook for scientists
Ijad Madisch, founder of ResearchGate
A NOBEL UNDERTAKING.
IJAD MADISCH WAS BORN
IN WOLFSBURG, GERMANY,
TO SYRIAN MIGRANTS. HE
BELIEVES THE PURSUIT
OF SCIENTIFIC ENLIGHTENMENT HAS LONG BEEN
TRAPPED IN AN IVORY
TOWER. AND HIS STARTUP
RESEARCHGATE AIMS
TO SET IT FREE. THIS
NOBLE ENDEAVOUR HAS
RECEIVED BACKING FROM
NONE OTHER THAN
BILL GATES.
His portal is sometimes dubbed Facebook for scientists. “Just imagine you’ve
made a breakthrough, but nobody hears about it,” says Madisch, who is in his
early 30s. The PhD virologist and computer scientist, who has studied in Hanover
and Harvard, is driven by a concern for the waste of human knowledge: “Every
day, potential once-in-a-century discoveries are going unnoticed in laboratories
and classrooms around the world, simply because communication between
scientists and researchers is slow and laborious.” Against this background,
Photo: Andreas Chudowski/Laif
he established ResearchGate, headquartered in his current home, Berlin.
ResearchGate is a platform that enables scientific experiments to be peerreviewed, shared and discussed online. With his sights set on a Nobel Prize,
Madisch has high hopes. Six years after its launch, the network reports
six million members in around 200 countries. And it has secured 35 million
US dollars in financial backing, including from Microsoft founder Bill Gates.
INTRO
—7
The smart glove
ProGlove performs scans and checks
THE GLOVE THAT SCANS.
TODAY’S FACTORIES COMBINE HIGH TECHNOLOGY
WITH MANUAL LABOR.
PROGLOVE IS DESIGNED
TO BRIDGE THE GAP BETWEEN THE TWO, SAVING
TIME AND INCREASING
EFFICIENCY AND SAFETY.
This smart glove is equipped with sensors, scanners
and RFID components that allow man and machine to
collaborate to best effect. As the developers themselves
are quick to emphasize, the human hand is still the best
Photo: Bernhard Huber
tool around. Powered by an Intel Edison module, the
glove can track movements, document activities, and
even ensure the worker is performing the right task, at
the right time. This prime example of wearable technology is designed to improve safety and productivity, while
cutting costs.
INTRO
—9
New head-up displays
Continental is developing a new generation
SAFETY IN SIGHT.
HEAD-UP DISPLAYS (HUDS)
PROJECT MORE THAN JUST
SPEED AND GPS DATA
ONTO YOUR WINDSHIELD.
CONTINENTAL’S NEW GENERATION OF HUDS HIGHLIGHT HAZARDS, DISTANCE
TO OTHER CARS, AND LANE
MARKINGS. THEY ARE SET
TO GO INTO PRODUCTION
IN 2017.
Information is displayed exactly where the driver needs it – on the
windshield. The result is a form of augmented reality: data gleaned from
sensors, cameras, GPS and assistance systems is seamlessly overlaid on what
the driver is viewing with his own eyes. This creates an entirely new and
enhanced driving experience. The new generation of HUD foreshadows the
Photo: PR
era of self-driving cars. Safety and convenience are improved, but the
human being behind the wheel remains in control.
24
24 CIO TALK AT CONTI.
GOING DIGITAL. Elisabeth Hoeflich, CIO of Continental Group, and
Heinz Egeler, Vice President of the Automotive Global Supplier division
of T-Systems, on two-speed IT and digitization over the last 50 years.
28 TEAMWORK.
GUEST BOOK. Dieter Schweer, member of the Executive Board at
the Federation of German Industries (BDI), takes stock of digitization
across German businesses.
30 AUTOMOTIVE.
12 WE ARE HEN DEGUO.
TOP STORY. The ‘made in Germany’ label enjoys worldwide renown,
particularly in the Far East and the USA. But it is these very markets
that have overtaken Germany in the digital stakes. As digitization
expands into engineering and manufacturing, we need to catch up.
20 PROMISING OUTLOOK.
ANALYZE IT. According to Christophe Chalôns, Chief Analyst at Pierre
Audoin Consultants, the service industry in the USA is a prime example
of how digital technology can transform entire sectors. But Germany’s
chance to shine will come.
22 MARKET BAROMETER.
TREND WATCH. In which industries will digitization create the most
jobs? And where do businesses and politicans see its biggest potential? The answers in charts and figures.
THE CONNECTED CAR. German carmakers are looking for ways
to keep pace with the likes of Google and Apple by creating their own
smart connectivity solutions.
34 GAS STATION 2.0.
GRAPHIC. Up to 86 percent of gas stations’ net sales are generated
in the convenience store, and not by fuel, oil and spark plugs. The gas
stations of the future will bring operators, suppliers and customers
together in a single, consolidated network.
36 QUALITY FIRST.
HEINEKEN CIO Anne Teague and Dr. Ferri Abolhassan, Director of
T-Systems’ IT Division, on delivery lows, steep learning curves, and the
role of people in ensuring high-quality IT.
41 ROBOT CO-WORKERS.
ESSAY. Intelligent robots are transforming industry and bringing fully
automated smart factories a step closer.
Photos: Francesco Lastrucci/Gallery Stock, Oliver Krato, Rinspeed, Christian Kerber
WIRTSCHAFTSWUNDER 4.0
CONTENTS
Issue 1 ⁄ 2015
— 11
<01> Driverless
cars are taking
travel to a whole
new dimension.
<02> CIO of
HEINEKEN Anne
Teague with Dr. Ferri
Abolhassan, Director
of the IT Division
at T-Systems.
30
<01>
44 THE HOTTEST IDEAS.
FEATURE. The BGU University and T-Laboratories are turning the
Negev desert in Israel into a hotbed of high-tech research.
BEST PRACTICES
48 IN A SPIRIT OF TRUST.
SALESFORCE. Starting in the second half of 2015, the creator of
cloud-based customer relationship management software will deliver
its CRM solutions from a T-Systems data center.
50 UNIQUE OPPORTUNITY.
ALL-IP. The single network for all communications tasks is becoming a
reality. Deutsche Telekom CIO Dr. Markus Müller talks about gearing up
for all-IP.
52 MOBILE SERVICES.
DEUTSCHE TELEKOM TECHNIK. A tablet-based solution connects
thousands of Deutsche Telekom engineers with dispatchers in real
time, eliminating time-consuming documentation tasks.
53 NEWS.
ThyssenKrupp migrates 80,000 desktops to the cloud ... T-Systems
teams up with SugarCRM, Informatica and security specialists FireEye
... Hospitals in Neuss and Bochum introduce mobile information
system for medical professionals.
36
<02>
ABOUT THIS PUBLICATION
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T-Systems International GmbH
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Keller, Klaus Rathje, Guido Reinking,
Dieter Schweer, Thomas van Zütphen
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Miele, Adidas, Braun –
German brands are
a common sight on
Chinese streets.
— 13
Wirtschaftswunder 4.0_digitization made in Germany
Top story
We are
hen deguo (“very German”)
GERMANY IS WORLD-RENOWNED FOR ITS ENGINEERING
PROWESS AND THE QUALITY OF ITS MANUFACTURING.
BUT HOW WILL THESE VIRTUES FARE INTERNATIONALLY
NOW THAT DIGITIZATION HAS HERALDED A NEW ERA?
TO DATE, OTHER COUNTRIES HAVE HAD THE EDGE. CAN
GERMANY CATCH UP? BEST PRACTICE TAKES STOCK.
<Copy> Michael Hopp
Photo: Francesco Lastrucci/Gallery Stock
FOCUS
AS CHINA’S CITY-DWELLERS have grown increasingly affluent and aspirational, Germany’s consumer products have grown more popular: cookies from
Bahlsen, chocolate bars from Ritter Sport, shavers and irons from Braun, scissors and knives from Zwilling. Adidas sports goods stores can be found just
about everywhere, from the major metropolises, to the smallest of villages. The
words “hen deguo” can work wonders. German has become an adjective that
is practically interchangeable with quality. Even if the products are sometimes
manufactured somewhat closer to home. In the US, too, more and more drivers
are switching saddle – from the once all-conquering Japanese marques such as
Toyota and Honda, to BMW and Audi. German washing machines get shipped
down under to Australia, where they enjoy a reputation for indestructibility. Yes,
they are pricey, but they consume less electricity and water.
DIGITIZATION MADE IN GERMANY
Products from the country’s key industries, such as auto manufacturing and
engineering, are practically synonymous with world-beating quality. But how
will the ‘made in Germany’ brand promise fare in the digital age? It is a question
that occupies the collective minds of movers and shakers in politics and business. And the need for answers is becoming ever more urgent.
Politicians in Berlin are certain, “A ‘Wirtschaftswunder’ – digital economic
miracle – is a real possibility.” But as Chancellor Angela Merkel asks, “Will it take
place in Germany?” Deutsche Telekom CEO Timotheus Höttges is cautiously
optimistic: “Non-European companies have won the first half of the digitization
match. But the Germans can stage a come-back in the second.” The goal is to
marry traditional virtues and strengths – particularly in manufacturing – with the
numerous new possibilities of digitization.
Germans are famous for being disciplined, hard-working, self-controlled,
frugal and safety-conscious. This reputation has enabled the nation to export its
goods to all four corners of the globe. But are these skills transferable to the new
era? Can these attributes drive digitization in Deutschland and beyond? Right
now, it is Asia and the US that are setting the pace – launching disruptive technologies with the power to upend entire industries. They are sweeping away the
tried-and-trusted, breaking and re-writing the rules. The ‘made in Germany’
brand cannot escape the maelstrom. And it is crying out to be reinvented.
Digital technologies are transforming work and lives: 3D printers are revolutionizing tasks for skilled tradespeople and logistics players. Data goggles enable
unskilled laborers to perform highly sophisticated assignments. According to
a 2014 review by the London School of Economics, robots are expected to displace 140 million full-time employees worldwide, even in highly specialized professions, within just a few short years.
Personal transportation, too, is undergoing a paradigm shift. The Shared
Mobility Study by Roland Berger published in 2014 predicts that between now
and 2020, the market for car sharing will expand by 35 percent a year. And the
self-driving connected car is set to go from science fiction to everyday reality
within the decade.
But while the rate of change seems to be accelerating globally, Germany
appears to be hesitantly waiting on the sidelines. The country is too slow, too
cautious, too worried. Too German?
IS GERMAN ANGST A HINDRANCE?
Is the digital transformation being stymied by angst? The population’s primary
concern seems to be privacy and protection. But it is a fear that has at least propelled Berlin into pole position in the security space: in late 2014, the German
government finalized a draft proposal for an IT security act. Federal Minister of
the Interior Thomas de Maizière hopes to rein in hackers and fend off cyber attacks to “make Germany’s digital infrastructure one of the safest in the world.”
In a study, Martin Hecker, Senior Partner and leader of the Technology
Advantage team at the Boston Consulting Group emphasizes: “Germany’s
economy has no need to eschew competition in its premier industries: automotive engineering and logistics.” The investigation examines the country’s
progress along the digitization superhighway. It concludes that banking,
insurance, healthcare and the information and media industry all lag way
behind their international counterparts.
If Germany’s 1,300 acknowledged world-leading businesses are to keep
their edge, they will need to digitize their proudest assets: machines, engineering, the German mindset. As Alexander Dobrindt, Federal Minister of Transport
and Digital Infrastructure, puts it, the “German digitization path” must overcome
obstacles in the shape of cost pressures, process reengineering during ongoing operations, legal certainty, and data protection.
German cars and washing machines, sweet goods, steel and precision
chronographs – they are all important products. But to survive and thrive in
the 21st century calls for the digitization of marketing and sales, and of the product itself, across the entire value chain – design, manufacturing, and intuitive
operation – in line with new consumer expectations. Millennials expect cars to
seamlessly integrate with their hyperconnected world; washing machines to
communicate with their owners; and chocolate bars to be tailored to individual
customer preferences. Put another way, if Germany wants to defend the fortress
of strength it has erected in the realm of physical products, it needs to play
catch-up in terms of customer service and digitization. Once cars go driverless,
horsepower and engine performance will no longer be the all-important factors.
People will purchase the vehicle best able to convey its occupants intelligently
and safely to the chosen destination; the vehicle with the best infotainment
package; the vehicle that knows the best Italian restaurant in town, and when it’s
time to go to the repair shop for a service.
In the world of mass production, Germany has carved out a lucrative niche
and enjoys success as a first-rate exporter. But to hold on to this lead going
forward, it will have to master the mysteries of the customer interface. In this
scenario, typically German thoroughness does not necessarily have to be an
inherent disadvantage. Quite the opposite. It could be a vital ingredient in
the pursuit of extremely effective, highly sustainable, end-to-end processes.
Engineering expertise is a sound basis for safeguarding the trust that German
products now enjoy. But it is not enough. There is an urgent need to rapidly implement smart manufacturing technologies, and to improve customer centricity.
THE ONE-SIZE-FITS-ALL MYTH
Why hasn’t that happened already? It is not just a lack of action, and missed
opportunities. It is also attributable to the highly manufacturing-driven character
of German industry. In the USA and Asia, things are very different: in Beijing,
Taipei, Los Angeles and New York, digitization began in the B2C space, with
the end customer. The result was the creation of a huge virtual environment,
dominated by marketing and sales – one that has launched online retail into an
entirely new dimension, with skyrocketing revenues.
If Amazon was the first mover then German mail order retail was an early
adopter. But the late success of the likes of Zalando cannot disguise the fact that
the nation’s real strengths lie elsewhere. Its Olympic champions are in engineering, manufacturing and heavy industry. Which is why the one-size-fits-all
approach to digitization will not work in the land of Beamers and Beethoven.
No auto component manufacturer in Munich, Stuttgart, Ingolstadt or Wolfsburg
could afford to adopt new, faster ICT systems if the price was a loss of quality in
the end product or security vulnerabilities in their manufacturing operations.
IT transformation in manufacturing would be inconceivable without an
understanding of the corresponding business models, and for the highly complex interdependencies that exist throughout the entire process and value
chain. Internationally, security concerns and outdated legacy systems are less
of an issue – and not just in the emerging economies. Companies can work with
a clean slate, and develop at high speed – assuming they have access to an infrastructure with the required stability.
FOCUS
— 15
Top story
E-tailers count as many customers
per second as successful bricks-and-
Photos: MINT Images/Gallery Stock, media.daimler.com
mortar stores in a whole day.
But digitization is now pervading the B2B world, and with it Germany’s traditional heartlands. The Internet of Things, for example, is proving to be fertile
ground for many of the country’s leading players. 73 percent of German
enterprises already have a big data strategy in place, or are in the early
stages of implementation. That is a key finding of an Automic study entitled
Driving Business Value and Agility, published by the US-based automation
specialists in February of this year (see Essay on page 41). It suggests that
big data is further advanced in Germany than in the US, where only 70 percent have defined a strategy or commenced introduction. This compares
favorably to France (56 percent) and the UK (41 percent).
America is indisputably the land of the Internet. But Germany is home to the
leaders in automation and engineering.
DIGITIZATION DRIVES GROWTH
And there are attractive opportunities to be exploited. The country that is first
off the blocks in the race to integrate Internet technologies into manufacturing
can look forward to strong growth. If German businesses succeed in making
their mark in this field, and in creating viable business models, there is huge
potential for healthy revenues and profits. McKinsey believes an increase in
gross domestic product of 207 billion euros is possible by 2025, equivalent to
2.1 percent annually, bringing with it ample new jobs.
German midsized enterprises are frequently accused of underinvesting
in digitization. The accusation is unfounded, or at least too sweeping. According to a study by DZ Bank, 90 percent of them are worried about security. 67
percent are investing in digital technologies to save money, but just 44 percent are hoping to penetrate new markets. At the same time, almost 70 percent are investing in smart manufacturing systems and electronic processes.
But if we are right to assume that German SMEs have recognized the
opportunities opened up by M2M, and the other technologies highlighted by
the German government’s Industry 4.0 initiative, then that is very good news.
Because they are the engine of the country’s economy. And they will be at the
forefront when it comes to dividing up the spoils of the new global markets;
they will play their part in the new digital economic boom. They will need to
mix and match the best of the old with the best of the new – engineering skills,
diligence, an innovative spirit, and a digital version of ‘made in Germany’.
But it is about more than just harnessing IT to model existing business
processes. It is about leveraging emerging technologies to redefine business
models. And that often entails giving up the tried and trusted.
DIGITIZATION PART 2
One thing is certain: after taking sales, marketing and the retail industry
by storm, digitization is set to advance into the B2B space. And preparing for
this transformation is no mean feat. The route almost always goes via the cloud,
with analytics and mobile collaboration key milestones along the way. How can
businesses effectively deploy these technologies when their requirements in
terms of quality, availability, data protection and security are so much higher?
ANALYTICS: BIG DATA MEETS SMART DATA
The retail sector has set the mood: the likes of Amazon know their customers
as well as mom-and-pop shopkeepers of yesteryear knew their regulars. With
the help of powerful analytics software, today’s retail giants identify consumer
requirements in real time and can respond at lightning speed, establishing new
processes for value creation. But timely insight into customers’ needs and
peeves can deliver handsome returns in the B2B sector, too – for companies,
their clients and the end customer.
Take engineering: A broken elevator in downtown Manhattan, Frankfurt’s
financial district or the business quarter of Shanghai elicits the same response:
fix it, and fast! And thanks to continuous communications between the lift
and its manufacturer’s cloud platform, a repair team can be dispatched pretty
pronto. But this level of service can be taken up another notch. M2M technologies based on sensors, receivers and smart networks hooked up to the Internet
of Things can detect an imminent glitch before the elevator grinds to a halt,
enabling proactive troubleshooting. And when a fault cannot be averted, a specially designed app tracks people as they enter the lift and can help locate them
in an emergency, benefiting facility managers and the elevator users.
Predictive maintenance is the name of the game, and it is playing an everbigger role in today’s economy – not least in the automotive aftersales market.
In Germany, once a vehicle’s warranty has expired, 17,500 marque-affiliated
service partners vie for custom with over 21,000 independent workshops.
Innovative IT solutions can play a pivotal role in securing customer loyalty. For
example, via a cloud platform, the vehicles themselves can notify mechanics of
the need to replace a part or perform a regular service, minimizing breakdown
risk and maximizing customer peace of mind. Information on the required component is transmitted directly via a service port monitoring system to the repair
shop’s procurement software – so when the driver shows up, the part is already
there. Mobile service offerings and solutions that enable prospective buyers to
browse showrooms outside of regular opening hours are further examples of
how IT innovation can help reduce customer churn to 20 percent.
Connected-car services open up a host of possibilities both on and off the
road: from hazard warnings sent to the driver’s smartphone, to anti-theft systems,
to alerts when maintenance is due; from roadside assistance for cyclists to smart
bikes that communicate with a cloud-based platform via a dedicated on-board
unit, SIM card and GPS.
NEXT-GENERATION MOBILE TEAMWORK
In the age of tighter integration between people, information and production
processes, cloud computing is accelerating collaboration and making it more
secure. But how can employees, partners and other external stakeholders be
granted anytime, anywhere access to data and applications – while safeguarding confidential, mission-critical information? In other words, how can
we streamline teamwork, support knowledge transfer and pool expertise –
but without compromising vital internal assets?
Many of today’s companies serve millions of people around the world.
They must coordinate tens of thousands of employees, resources and goods
– from raw materials to sales teams. And tight security is required to protect
sensitive corporate data and intellectual property stored in legacy infrastructures. Making up to 150 terabytes of valuable data available to users via stateof-the-art SharePoint hubs is a tall order. It is a challenge that only the unique
architecture of a hybrid cloud can master.
How can digitization address these challenges and enhance logistics?
Interaction between man and machine paves the way for greater speed in
logistics, and entirely new opportunities for value creation. When mobile pro-
Connecting industrial
products, consumer
goods and virtual
teams: the cloud is often
the technology of choice
for achieving scalability
and cost-efficiency in
the Internet of Things,
M2M, and mobile
collaboration.
duction equipment, such as fork lifts, construction vehicles or conveyors, fail,
they cause severe disruption – and can cost millions in lost profits. In these
circumstances, the pressure is on to dispatch a service engineer – and that
means updating their schedule, reliably and remotely.
For instance, by enabling organizations to connect everything: their
ERP and warehouse management systems, the vehicles and equipment deployed by their customers, and the handhelds used by their service engineers. How? Via a cloud platform. Intelligent integrated solutions such as
Deutsche Telekom’s Arrival Control app provide real-time insight across the
entire repair process – from the moment the engine management system
generates an error code, to ordering spare parts, to dispatching the service
engineer. As a result, service tasks can be planned better, and vehicles and
machines are back up and running faster.
Or take robots. These high-tech workers will be crucial in tomorrow’s
connected world, and are an important part of the German government’s
Industry 4.0 program. From miniature versions that automate logistics and
picking processes in warehouses and distribution centers to robotic arms in
automotive assembly lines, these smart machines have an exciting future.
FOCUS
— 17
Top story
Photos: plainpicture/photocake.de, plainpicture/Canvas, plainpicture/Cultura
“GERMANY’S ECONOMY HAS NO NEED TO
ESCHEW COMPETITION IN ITS PREMIER INDUSTRIES:
AUTOMOTIVE ENGINEERING AND LOGISTICS.”
Martin Hecker, Senior Partner Boston Consulting Group
“AS A LEADING INDUSTRIAL NATION, GERMANY IS
PREDESTINED TO ESTABLISH STANDARDIZED
SOLUTIONS. THE COUNTRY ENJOYS A REPUTATION FOR
INNOVATION AND, MORE ESPECIALLY, QUALITY.”
Christophe Chalôns, Chief Analyst, Pierre Audoin Consultants
THE CLOUD UPS THE PACE OF CHANGE
The cloud is the No. 1 enabler. It is an engine for digitization and at the heart of
almost every innovative business model and marketplace revolution. Cloudbased platforms have driven the transformation of the retail industry.
Leading e-tailers such as Alibaba now register around 100,000 customers
every single second. That’s roughly the same number as pass through the doors
of a busy bricks-and-mortar store like KaDeWe in Berlin in a whole 24 hours. In
November 2014, Alibaba racked up sales of 9.3 billion dollars in a single day; a
billion was generated in just 30 minutes. Without the elasticity afforded by cloud
solutions, fluctuations of this magnitude would paralyze any IT infrastructure.
A similar degree of flexibility is required in the B2B space, for example to
support the rapidly changing requirements of transport hubs – such as sea
ports. In Germany alone, container traffic is set to more than double by 2025 – as
reported by the Federal Ministry of Transport. Telematics solutions are capable of
stemming the tide – by efficiently managing goods flows, coordinating loading
and unloading activities, ensuring effective deployment of trucks, and preventing
congestion on-site and on the surrounding roads. These applications provide
real-time, role-specific visibility for port managers, fleet coordinators, logistics
companies, drivers, and operators of gas stations and rest stops. Through an
interface to SAP HANA, the system also provides up-to-the-minute information
on road closures, construction work and the status of jobs – keeping everyone in
the picture at all times.
Gas stations can also harness these powerful solutions to improve customer
service. According to a 2012 study commissioned by BDT, the German association of independent gas stations, over 86 percent of net revenues are generated
by the in-station convenience store. So it is ready meals, snacks and drinks – not
fuel, spark plugs and light bulbs – that are driving revenues. This means that the
product range and advertising must be entirely up to date. Customers want full
shelves, direct communications and state-of-the-art services. A cloud-based ERP
and POS system is the springboard to success – supporting promotions, ad
campaigns and flexible payment methods across the entire gas station network.
FOCUS
— 19
Top story
From automotive
engineering to logistics
to soccer: Germany
leads the field in a
variety of disciplines –
and digitization plays a
key role in all of them.
In fact, cloud computing is cropping up in areas of our lives where we would
not expect it – soccer, for example. The cloudification of the beautiful game
has two main advantages. First, data captured on the pitch can be analyzed
to improve tactics and help teams up their game. And second, IT solutions
enable soccer clubs to deliver value-added, multi-media content to fans’
smartphones in the form of graphics, videos and animated replays. What’s
more, they can integrate their ticket and merchandise sales via apps and a
dedicated customer relationship management platform.
Photos: plainpicture/Cultura, plainpicture/Sabine Vielmo, Laurence Griffiths/Staff/Getty Images
QUALITY AND SECURITY ARE KEY
Cast-iron security and reliable operations are the basis for the effective
deployment and development of innovative technologies in the B2B space.
Ensuring data security, protecting intellectual property and delivering stable,
highly available systems are key imperatives. At the heart of these objectives
is the network itself. To be truly successful, any innovation must be based on
these three elements.
Deutsche Telekom network supports download rates of up 100 Mbit/s and
uploads speeds of up to 40 Mbit/s. Cutting-edge vectoring means data
is transmitted at high speed directly to the user, and the fiber optic network
no longer terminates before the last mile. In 2014, Deutsche Telekom has
invested over four billion euros in the development of its networks, and has
implemented hotspots in 255 high-speed ICE trains and for 16 airlines.
HIGH-LEVEL IT SECURITY: PROTECTING DATA
But there is a flipside to digital progress – in the shape of cyber crime. And
the figures are disturbing: on average, hackers can infiltrate a network for an
average of 229 days before they are detected. Some 63 percent of all German
companies have been the victim of at least one cyber attack – despite the deployment of anti-virus software. For organizations that want to reap the benefits
of highly-innovative M2M technologies and leverage real-time cloud-based
analytics, watertight security is an absolute must, and the key to digitizing business processes. IT security solutions coupled with the strict provisions of the
data protection legislation are essential for protecting digitial infrastructures.
A HIGHLY RELIABLE IT PLATFORM
Efficient delivery of IT solutions in line with customer requirements is crucial to
business success. Companies need access to the best platform, the best network and the best security mechanisms. Standardized ICT platforms safeguard
end-to-end business continuity. The cloud consolidates and standardizes IT
infrastructures, cuts costs, streamlines communications, supports collaboration between global project teams, and improves interaction with customers,
partners and suppliers. Moreover, private cloud services are delivered from a
fail-safe, twin-core data center offering up to 99.999 percent availability.
Wirtschaftswunder 4.0 – digitization made in Germany – is much more than
just pie in the sky. The cloud, M2M communications and other technologies
included in the government’s Industry 4.0 program are making the country a
frontrunner in the digital age. Former German chancellor Ludwig Erhard
took issue with the term “Wirtschaftswunder” – economic miracle. He preferred to view his country’s economic prowess in the 1950s and 1960s “as
the result of hard work and not a miracle that simply happened overnight.”
THE BEST NETWORK: INCREASED QUALITY AND SPEED
For Germany to assume a central role in the upcoming digital economic miracle, precipitate growth and create jobs, it needs speed. And that means highperformance broadband connections and powerful networks. The new
<Contact> bestpractice@t-systems.com
<Link>
www.t-systems.com/industry-4-0
“IF MADE-IN-GERMANY ICT
SOLUTIONS DIDN’T NEED A MANUAL,
THEY’D BE PERFECT.”
Christophe Chalôns,
Chief Analyst, Pierre Audoin Consultants
<Interview> Thomas van Zütphen
Germany seems to lag behind its international rivals
when it comes to corporate IT transformation. Is that a
fair assessment?
We need to be careful with these kinds of comparisons but,
yes, Germany is not as far down the road with the public cloud
as other countries. However, the public cloud lacks the bulletproof security required for critical applications. By contrast,
Germany has made relatively strong progress in the private
cloud space, and in T-Systems, with its AppCom platform, it
has a pioneer within its own frontiers. A private cloud is typically managed by a professional service provider – so its security is far more robust. In terms of digitization, Germany is not
as advanced as, say, the US or France. As a nation, Germany
is more noted for its manufacturing than for its services. However, the service industry is where digital transformation
is having the greatest initial impact – while manufacturing
is waiting for the impact of the German government’s Industry
4.0 initiative. In any event, the starting point for IT transformation is a standardized, agile, flexible platform – and
German businesses have achieved a great deal in this sphere
in recent years, particularly with regard to standardization
and efficiency.
How must businesses tackle IT transformation to exploit
the opportunities of digitization while guarding against
potential pitfalls?
There are several aspects to consider. Enterprises wish to rationalize, standardize and streamline their IT landscapes for
greater efficiency and agility, and cloud computing will be
vital to fulfilling these goals. However, each business must be
willing to embrace this standardization – and this is not always the case. The same question keeps cropping up: should
I gear the IT environment to my processes, or vice versa? If I
try too hard to tailor the software to my specific situation,
implementing something like Salesforce would cost millions of
euros. In reality, it would be better for me to stick to a more
traditional solution. Otherwise standardization would only
fulfill a fraction of its potential.
The second aspect to consider is digitization itself. It isn’t
about using IT to support existing processes – it’s about reengineering the entire business model using state-of-the-art
technology. Many companies hesitate at this point, because it
involves giving something up. But technology is evolving faster than ever, and new technology brings new opportunities.
Against this background, agility is an absolute must. Many
businesses balk at the idea of changing too much, too soon,
and often with good reason. But they simply cannot afford to
sit back while rivals make a quantum leap. Personally, I feel
pilot projects – where new concepts can be put to the test – are
the right way to go, both from a technological perspective, and
in terms of their suitability as a business model. There are
plenty of ideas out there, but not all are profitable.
In your opinion, what is the quickest way to separate the
wheat from the chaff ?
This is a very important question. Digitization requires the
CIO and business users to interact with each other in a different way. The users have a clearer understanding of business
and process requirements – but few have the technological
expertise needed to develop a long-term IT strategy. In addition, they often underestimate the administrative effort
required for integration – particularly between new applications and back-end systems. The CIO is responsible for technology and integration, but he must be able to envisage how
technological development will impact the business. This will
allow them to gauge how this will improve business processes, including potential disruptive changes to the business model. If they cannot, they are effectively demoted to the
role of an IT cost manager. CIOs would be acting in line with
the established pattern; in other words, overseeing costs,
while the business users add value.
Why do many businesses dither when making investments in new technology, for instance in cloud solutions?
Progress is being made. Most organizations are on the path
towards cloud technology, big data and mobility. They’re
moving more slowly than they should be, but they’re getting
there. Again, we are fast in some respects, and sluggish in
others. German companies have already achieved a huge
amount in terms of rationalizing IT platforms, and have invested heavily in this field in recent times. They will not, therefore, be willing to discard their existing IT infrastructure and
implement a new one themselves. However, cloud services
could provide an interesting alternative. Businesses have been
FOCUS
— 21
Analyze IT
far quicker to latch onto more recent concepts, such as big data
– with many deploying state-of-the-art technology in very
short order. Emerging countries, such as China and India, are
rarely burdened with the legacy solutions typically found in
German businesses. As a result, these countries can often embrace the latest IT straight away, provided a stable infrastructure is in place, which is often far from a given. Security is a key
issue in Germany – and is the main reason why the public cloud
has gained little traction here to date. By contrast, businesses
are far less concerned about security when deploying hosted
private cloud solutions. This is because IT service providers
typically offer exceptionally high levels of security that few enterprises could match under their own steam.
Photo: private
Is this reluctance to change prudent?
Again, Germany’s position is not too bad. It has a strong manufacturing industry; it enjoys a reputation for innovation and,
more especially, quality. In other words, businesses are, by nature, cautious. Nonetheless, enterprises across all industries
need to step up their IT transformation efforts. A key focus
must be the cloud – an option that companies should seriously
consider. It is the key to enhancing efficiency and achieving the
agility and flexibility that digitization requires.
How well prepared is Germany, in terms of technology
and its legal framework, to assume the mantle of leader
in digitization?
As a leading industrial nation, Germany is predestined to establish standardized solutions – including software, as SAP
has demonstrated across the world. The country develops excellent, high-quality products that are stable and durable.
And German IT solutions are robust and reliable. However,
they are often regarded as over-complex and non-intuitive.
Very often, made-in-Germany IT solutions come close to perfection – but nobody can operate them without a user manual. It’s different when security is the priority, as it is with
cloud solutions and digitization. In these instances, it is good
to have something in black and white that you can rely on –
and in this context, Germany has the opportunity to be a
trailblazer if its data protection legislation gains widespread
acceptance. The more nations that sign up for this legal
framework, the better.
You’ve mentioned differences between industries – who is
in pole position, who needs to catch up?
That depends greatly on the criteria used to define leadership.
Through the entire ERP concept, manufacturing already
enjoys a high degree of integration and standardization in
administrative and commercial processes – particularly in
Germany, thanks to SAP. But many people complain about the
complexity and correspondingly high costs, and the lacking
agility of the ERP landscape. The cloud, and SaaS in particular, signal a partial return to the best-in-breed approach, with
its supposedly lower costs and greater flexibility. However, the
high integration effort that comes with this is often forgotten.
But if we look at manufacturing, cloud models, especially SaaS
and hosted private clouds, are, in general, already widely accepted. But by the same token, not everything can be transferred to the cloud overnight.
That addresses the platform side of things. But how does
the degree of digitization compare across industries?
In this regard, the service industry is already well ahead. But
we will soon see significant advances in manufacturing. In this
context, the Industry 4.0 initiative will play a key role – and
bring change in many areas, including production processes,
logistics, customer service, and the products themselves. We
will witness the emergence of new business models, and substantial changes to the value chain and forms of collaboration
between partners. In this context, businesses need to have a
clear picture of the benefits and risks of digitization. And they
require experienced IT service providers, who not only have
the corresponding technical knowledge, but also understand
their clients’ business processes. They also need excellent innovation skills, in conjunction with the ability to identify
and implement new business models. Put simply, service providers who only understand technology are going to have to do
their home-work. They need a knowledge of processes and the
ability to innovate. Only then can they assist in the journey
from current mode of operation to future mode of operation in
the upcoming IT transformation.
<Contact> c.chalons@pac-online.com
<Links>
www.t-systems.com/cloud-made-in-germany
pac-online.com
REPORT 4.0
GERMANY IS GOING DIGITAL – AND REAPING THE BENEFITS.
BUT COMPARED TO THE COMPETITION, IT STILL HAS SOME
CATCHING UP TO DO.
GERMAN GOVERNMENT SPENDING
GERMAN INDUSTRY INVESTMENT
BN.
The federal German government plans to provide nearly half a billion
euros in funding for digitization by 2017.
BN.
German businesses aim to invest 40 million euros in M2M and similar
technologies (Industry 4.0) by 2020.
1/2
40
Source: NDR, http://www.ndr.de/nachrichten/hamburg/IT-Gipfel-Millionen-fuer-dieDigitalisierung,itgipfel108.html, 2014 (German only).
AREAS EARMARKED FOR INVESTMENT:
AREAS EARMARKED FOR INVESTMENT:
The German government consulted a number of business, R&D,
and public sector experts to determine which industries to invest in.
On average, the 235 industrial companies surveyed will invest 3.3
percent of their annual revenues in M2M and similar technologies.
INVESTMENT AREAS:
VOLUME OF INVESTMENT (IN % OF ANNUAL REVENUES)
Infrastructure 26%
Mechanical and plant engineering 3.5%
Security/data protection 13%
Automotive industry 2.9%
Digital literacy/education 12%
Process manufacturing 2.7%
ICT 3.9%
E-government 12%
Source: German IT Planning Council, Zukunftspfade Digitales Deutschland
2020, 2013 (German only).
Source: PWC, Industrie 4.0 - Chancen und Herausforderungen der industriellen
vierten Revolution, 2014 (German only).
DIGITAL READINESS INDEX:
The Boston Consulting Group has benchmarked seven German industries against international best practices.
100 points is the maximum score. The logistics and automotive sectors perform best, followed by engineering and retail.
The TIME industries, financial services and healthcare are lagging behind. By 2020, a number of German sectors will
have undergone significant digitization. Others have already experienced a high degree of transformation; the latest
digital wave will not mean further substantial change.
Source: Boston Consulting Group, How Digital is the German Industry?, 2014.
Illustration: Barbara Geising
German logistics industry in
a global comparison:
Customer interface:
Digital products and business models:
Processes:
Impact of digitization on this industry by 2020:
Customer interface:
Processes:
= Digital readiness: 0 – 19 |
German automotive industry in
Customer interface:
Processes:
Customer interface:
Processes:
German engineering in
Customer interface:
Processes:
Customer interface:
Processes:
= Digital readiness: 80 – 100
FOCUS
— 23
Trend watch
HOW MANY JOBS DOES DIGITIZATION CREATE?
THREE EXPECTATIONS ASSOCIATED WITH DIGITIZATION
In 2012 alone, digitization created 1.46 million jobs in Germany:
976,000 in the service sector, 300,000 in manufacturing, 28,000 in
engineering and 24,000 in the automotive industry.
DIGITAL READINESS
Two thirds of companies surveyed are already actively digitizing their value chain;
a quarter of them have already made substantial progress. 80 percent expect their
value chains to be highly digitized by 2020.
80
%
REVENUES
German businesses expect increased annual revenues of over 30 billion euros
through M2M and similar technologies. Increased digitization of product and service
portfolios will enable them to increase revenues by an average of 2.5
percent each year.
+ 30
= 10,000 jobs
BN.
EFFICIENCY
Digital solutions will increase efficiency by approximately 20 percent by 2020.
Respondents expect an annual average increase in efficiency of 3.3 percent through
the digitization of their value chains. This aggregates to 18 percent over the next five
years. Over the same period, annual savings of 2.6 percent are projected.
Source: A study conducted by the Prognos research institute on behalf of Bitkom, 2014 (German only).
DIGITIZATION AT GERMAN COMPANIES
The overall digital readiness of German businesses across all criteria
is 66 percent.
20
Processes and infrastructure 63%
Vision, strategy and
business model 55%
%
Source: PWC, Industrie 4.0 - Chancen und Herausforderungen der industriellen vierten Revolution, 2014 (German only).
“Manufacturing accounts for 23 percent of German
economic output: a large proportion compared to
other countries. This enables us to lead the way as
a provider of and a market for the technologies
featured in the Industry 4.0 initiative.”
Customer engagement 73%
People, culture, governance & organization 79%
Overall digital readiness 66%
Dieter Schweer, BDI (Federation of German Industries) Executive
Source: PWC, Der Digitalisierungsbarometer, 2014 (German only).
<Contact> MI-ECM@t-systems.com
German retail in a
global comparison:
Customer interface:
Processes:
Customer interface:
Processes:
German TIME (technology, information,
media, entertainment) industry
in a global comparison:
Customer interface:
Processes:
Customer interface:
Processes:
= Digital impact: 0 – 19 |
German financial services
in a global comparison:
Customer interface:
Processes:
Customer interface:
Processes:
German healthcare in a
global comparison:
Customer interface:
Processes:
Customer interface:
Digital products & business models:
Processes:
= Digital impact: 80 – 100
“We’ve been going
digital for the
past 50 years.”
ELISABETH HOEFLICH, CORPORATE CIO OF THE CONTINENTAL GROUP, TALKS
TO HEINZ EGELER, VICE PRESIDENT OF THE AUTOMOTIVE GLOBAL SUPPLIER
DIVISION AT T- SYSTEMS, ABOUT ACCELERATING THE INTEGRATION OF
INNOVATIVE SOLUTIONS, CAREERS IN IT, AND A COMMON MISCONCEPTION
ABOUT DIGITIZ ATION.
The business
Revenue forecast (2014): €34.5 billion
Employees (as of December 2014): approx. 190,000
Divisions: Chassis & Safety, Interior, Powertrain, Tires and Conti Tech
Over 200 sites in 49 countries
Focus
— 25
CIO-Talk_Continental
Ms. Hoeflich, to benefit from rapid growth in global automotive markets, you have to keep pace. What challenges does that bring about for
Continental’s IT?
The first issue is that we operate a global IT strategy, but are organized
decentrally. We follow our customers around the world, and have to deliver highly diverse solutions that meet specific business needs and expectations. A company ordering a large-scale conveyor system for a mine
in Brazil has totally different requirements to a customer tasking us with
development and production of an entire head unit for a car. By the same
token, our customer-facing aftersales units, like tire subsidiary Vergölst,
have very different needs to those in the B2B space. To remain successful
across the board, we need to deliver multifaceted solutions and ensure
their availability around the world. To this end, we are increasingly
teaming up with partners.
Photos: Oliver Krato
How does that work in practice?
Our strategy is to keep core competencies in-house. That way we can be
sure that new technologies are properly integrated with our business processes. And we can decide for ourselves which of the many technology
hypes out there are relevant to Continental. We in IT need to keep abreast
of the trends as they emerge, and gauge their impact on our business. If
we identify value-adding potential, we need to be ready to take on the
role of enabler.
One current trend is predictive maintenance for cars. A key goal is to improve driver satisfaction. End-to-end connectivity – for instance via sensors fitted to car components that are subject to wear and tear – can help
our customers deliver a broader range of higher quality services to their
own customers. Around 75 percent of value creation in the automotive
industry is initiated by suppliers – and this example underlines that fact.
As soon as cars are hooked up to the Internet, IT has a central part to
play. This is more directly relevant to our IT professionals in product development than to us in internal IT. But the boundaries between the two
are blurring. There are 10,000 software engineers employed across our
business departments. That’s four times as many as in our IT itself.
And how is internal IT developing – in particular, with regard to what
you were saying earlier about always being close to your customers?
It is growing – at a moderate pace, but continuously. The more sites we
have, the higher the demand for on-site IT support. We now have around
1,500 employees in global delivery and another 1,000 working in local IT.
The team is getting closer to the business, especially where our core systems are concerned. At the same time, we are looking to develop our nextgeneration information capabilities – which is more commonly known by
the label ‘digitization’ nowadays.
Migration, integration, transformation – for Continental CIO Elisabeth
Hoeflich and Heinz Egeler from T-Systems, collaboration on innovative
IT solutions means a joint learning curve.
Why do you put it like that?
Well, if I’m honest, we have been digitizing our organization for
the past 50 years. But there is much greater connectivity now,
and digitization touches more areas of the business. This is because today’s innovative IT technologies reach into parts of the
business that previous solutions didn’t. IT is increasingly becoming an innovation driver. That said, it continues to evolve
gradually – transformation doesn’t happen overnight. We’re
seeing a lot of new developments and powerful technologies,
both in software and hardware. And thanks to in-memory computing and context analysis tools, we can do things in a matter
of minutes that used to take several days. But all these developments are based on ideas we’ve been working on for years. Automation and IT-supported assembly lines are not something new.
At Continental, we began to integrate machine management
with MES some 25 years ago. Granted, there were more limitations back then and it wasn’t in real time, but the vision was
there. A major difference between then and now is that we
have been able to overcome physical hurdles by implementing
sensors, WiFi, huge data storage repositories and powerful connectivity. What I’m saying is: just because Apple now offers
first-class iPads and iPhones, it doesn’t mean we’ve just stepped
out from the stone age into the digital era.
But enterprises are under pressure, right?
Yes, we are, because development cycles are shorter, and the
pace of change is much faster. But you can prepare for all that.
One thing is certain: the virtualization and digitization of recent decades is here to stay. And we must be careful not to get
too wrapped up in routine tasks. We need to free up resources
for pursuing new trends and technologies – so that we can
evaluate their relevance to Continental.
So what are you doing in the way of preparation?
We have defined five in-house councils that act as technology
radars, staffed with people from all corners of the enterprise.
They specialize in mobility, the cloud, smart manufacturing
and Industry 4.0, big data and social media.
And how do you go about generating the speed required to
integrate new technologies and support the business?
Over the years, these five cross-company groups have saved us
time, money and energy by focusing on key industry innovations. This centralized approach means we don’t duplicate effort by having each department develop its own answer to the
same problem: we work in unison. One example is SAP HANA,
which we implemented to streamline our BI processes. All our
business units were on board from the get-go. So they all had
the same blueprint and there was no need for them to run their
own individual pilots.
To support excellence in IT, we have established a dedicated
career path at Continental. We have a small team of 21 employees who cover a range of specialist areas. They all share
the same three characteristics: in-depth knowledge of technology and corresponding business process; an eye for new trends
that will streamline our R&D and supply chain; and the ability
to work in a team, communicate ideas and transfer know-
ledge. In short, their task is to drive business innovation
through IT innovation. This means technology and the fast
pace of digitization don’t take us by surprise and we are always in a position to know which of the hypes are relevant to
Continental. This helps us plot the right course for our units
and divisions, identify potential new business models, and
improve our relationships with customers, while enabling
them to do the same with their own customers. These are
hugely important tasks, which is why this career path goes all
the way up to executive level, but with no direct responsibility
for managing other employees.
You mentioned the role of partners – how important is
quality when it comes to selecting a partner?
Exceptionally so. I can give you a good example: not every
software vendor has the skills needed to become a successful
cloud provider. They simply do not have the expertise required
to securely operate large-scale, high-performance data centers
around the world. So to ensure high-quality delivery, enterprise software vendors must join forces with a partner who
has data center experience.
You mean like Salesforce and T-Systems?
Exactly. Moreover, many cloud products originated in the consumer space. Business IT has completely different security
and reliability requirements, and handles huge volumes of
data. This is often overlooked. In practice, this means that if a
provider of consumer solutions does not have the necessary
security skills that a business requires, then they need to partner with someone who does: someone with encryption experience, who understands – and can make sure – that the key
remains with the user and not in the cloud.
To what extent would you say the cloud is the right place
for SAP applications?
It is definitely suitable for the infrastructure. But I don’t think
SaaS is the right delivery model for us because we customize
our SAP landscape to give us competitive advantage. Integrating and modelling our processes to enhance our efficiency requires considerable effort. The results are highly tailored
to our needs. In other words, our SAP software is not an
off-the-peg commodity solution. And I don’t want to share it
with everyone.
You have migrated almost 200 SAP systems and 100 nonSAP systems for 50,000 users to a T-Systems’ private
cloud. Was this the right decision?
Absolutely. The T-Systems Dynamic Cloud Platform has
helped us integrate SAP HANA quickly, securely and seamlessly into our existing landscape. It wasn’t just the technology, but the whole strategic concept that informed our decision. The first step was to deploy SAP HANA in our business
warehouse environment, which is where it made most sense.
But we have also launched a pilot for ERP. In 2009, we concluded a contract with T-Systems based on pay-per-use pricing, no minimum purchase, and with no fixed term. It was
certainly the most innovative contract for on-demand services
Focus
— 27
CIO-Talk_Continental
Résumé
Elisabeth Hoeflich was
appointed Corporate CIO
of Continental in 2012.
She oversees IT across
the entire organization.
After joining the company
in 1986, Hoeflich, who hails
from Sweden, held several
senior positions, including
CIO of the Automotive and
Tires Division and of the
Rubber Group. Previously,
she spent 11 years in a
managerial role at ITT.
back then. But it’s about a longer-term partnership. The relationship – in essence a technology partnership to move all our
mission-critical SAP systems to a single tier-4 data center – is
still going strong. Right now, T-Systems and Continental are
at the beginning of a joint learning curve, as we gear up to
switch from a less standardized operating model to DCS 3.0.
Photos: Oliver Krato
In 2013, you tasked T-Systems with the development of a
worldwide WAN. What has the learning curve been like
for that project?
We’re learning all the time – and making lots of joint discoveries. And this applies to networks, too. No telecommunications
provider can cover the entire globe – so you have no choice but
to work with partners. And it is really worthwhile seeking out
the very best local partner you can find; otherwise you run the
risk of encountering issues and escalations that can damage
your business. Global WAN is not available at the touch of a
button. We have to work hard to achieve it and this means
working hand in hand.
What are the reasons for escalations?
They are often very simple. Take RFPs, for example. These can
take up to 15 months to complete. During this time, the world
continues to evolve. New sites are established, broadband requirements change, you need tighter security or a higher service level, more advanced technology becomes available or
you simply relocate to a different building on the other side of
the street. I’d say that each year, around 30 to 50 percent of our
sites undergo structural change of some kind.
A further issue is the rapid development of the digital world.
Requirements are evolving faster and more frequently. And in
order to respond, we need stable networks: they are our central nervous system, enabling digitization, WAN, cell phone
operations and coverage around the world.
Of course, this does not come cheap. But our priority is to
maximize coverage. What use is a low-cost solution if it has
poor availability? This is one of the reasons for our recent decision to renew our T-Mobile contract for the operation of
17,000 devices for employees in Germany.
You have just learned that anti-trust authorities have approved Continental’s acquisition of US technology player
Veyance. What does this mean for you?
There is a long road ahead – but we have extensive experience
with integrating acquisitions. The first thing on the agenda is
connectivity so that we can call up vital data and information,
and enable access to shared resources, such as email, our intranet and the corporate phone book. This will also give us the
financial data and metrics we need for reporting. Veyance’s
structured SAP landscape is a big help: it won’t be a clunky
carve-out. But the company has placed its MS Office and
email applications in the cloud. We run ours on-premises, and
deploy Lotus Notes. Another issue is the Goodyear brand. We
have acquired Veyance but not its Goodyear rights, so we need
to weed out the relevant applications. I believe the organizational and infrastructure tasks will take around six months.
But for the entire integration, we’ll need around three years.
There’s plenty of work to be done!
<Contact> heinz.egeler@t-systems.com
<Links>
www.t-systems.com/digital-age
conti-online.com
Ready for
digital take-off.
how ca n g erm a n y re a p th e b en efits of d ig itiz ation?
Ac c o rd ing to BDI e x ecu ti v e D ie ter SchwEer , the a n sw er
lies in foc u sing o n ho me - g rown strengths , fostering
te a mwo rk a nd fo rwa rd - loo k ing p olitic s in Eu rope .
The word digitization conjures excitement and enthusiasm, but, as I often encounter, it also triggers skepticism from
German employees and entrepreneurs. The digital revolution
is, however, here to stay, and anyone who regards it as mere
hype or a threat to jobs is in danger of overlooking the huge
opportunities it offers. New information and communications
technologies (ICT) are set to radically alter our economy and
the world of work. We should not simply be asking how we
can work together to react to these changes. Instead, we
should focus our minds and energies on proactively shaping
digital developments, in order to benefit from them.
The ICT industry is already of huge economic importance. In Germany, it employs some 900,000 people and comprises more than 86,000 businesses. The sector has
created almost 100,000 new jobs in the last five years alone.
Aggregate annual revenues continue to grow, and are already
in excess of 150 billion euros. Network equipment, enterprise
software and encryption tools made in Europe are exceptionally successful the world over. And a large number of European players are world leaders in their chosen markets.
But truth be told, many segments of the digital economy
are dominated by other regions. The top IT service providers
and nearly all the big software vendors are based in the US.
The most successful makers of hardware, including PCs and
laptops, are American and Asian. Just ten percent of global
ICT sales revenues are posted by Europeans. And ICT market
growth is far higher in the US and China.
But we should not be misled by the illusion that German
companies will be forced to play the role of suppliers to US
and Asian vendors. Instead, we should be concentrating
more on our strengths. In Germany’s traditional industries –
plant, automotive, electrical and general engineering – the
country remains a force to be reckoned with. And it is in these
sectors that we must seize the opportunities proffered by digitization by the scruff of the neck. There is significant potential
for growth and innovation in the fields of M2M communications, in-vehicle and carto-x connectivity, smart logistics, smart homes and digital construction.
Germany can turn digitization to its advantage – as long as we do not simply
copy others, but focus on and harness our own strengths. Manufacturing accounts
for 23 percent of German economic output, a remarkably high proportion compared to other countries. This stands us in good stead to lead the way as both a
provider of and a market for M2M and other manufacturing-related technologies
featured in the German government’s Industry 4.0 initiative.
Integrating all participants and products into the manufacturing value chain
can deliver huge potential: studies suggest that digital transformation could
increase productivity by as much as 30 percent. If the Industry 4.0 program is successfully implemented throughout the country, it could add 267 billion euros to the
economy by 2025.
But the German business community cannot master the challenges of digitization alone. It is a project of vast proportions, and needs to be tackled by society as a
whole – and it is project that politicians, too, must wholeheartedly embrace. For example, there is a need to rapidly extend broadband connectivity to the entire country. In the future, business investment decisions will not just be based on the availability of electricity grids and similar infrastructure, but also on access to high-speed
web connections. At the moment, Germany is lagging behind other nations in the
race to roll out superfast Internet, far behind the US, Japan and South Korea. At the
same time, broadband is vital to the development of innovative real-time solutions,
especially for Germany’s small and mid-size enterprises – predominantly located in
rural areas. Moreover, in the international arena, we need to be more rigorous in our
defense of German data protection and security standards. Without robust standards, people are less likely to accept and trust in new digital capabilities – and this
in turn negatively impacts market opportunities. But we should not go it alone: our
aim must be a single, harmonized digital market across Europe. Digital business
models are dependent on markets that have critical mass. If politicians can create
the right framework, German and European businesses can and will succeed in
mastering digital transformation.
<Contact> d.schweer@bdi.eu
<Links>
www.t-systems.com/industry-4-0-sme
bdi.eu
Photos: Colin Anderson/Getty Images, www.studio-mueller.co
<Copy> Dieter Schweer
FOCUS
— 29
guest book
“iF PoLiTiCianS Can CreaTe The
righT FraMeworK, gerMan and
eUroPean BUSineSSeS Can and
wiLL SUCCeed in MaSTering digiTaL
TranSForMaTion.”
Résumé
Our guest author Dieter
Schweer is a member of the
Executive Board of the Federation of German Industries
(BDI). Schweer, who has a
degree in business administration and journalism, was
previously Communications
Director at RWE and a senior
manager at T-Systems.
A marathon,
not a sprint.
Germany’s auto industry lavishes more R&D spend on
in-vehicle connectivit y, infotainment and driver assiStance systems than any thing else – bar efforts to cut
carbon emissions. The ultimate aim is to ensure future
car generations continue to be designed and developed
in Stuttgart, Munich and Wolfsburg, not Silicon Valley.
<Copy> Guido Reinking
Focus
Photo: Rinspeed
— 31
Automotive
THE AUTO INDUSTRY FACES A DILEMMA: ”We take three years to develop a car, spend
five years manufacturing it, and it then drives around our roads for the next ten,” explains
Wolfgang Ziebart, Group Engineering Director at Jaguar Land Rover and former CEO of
Infineon. But no matter how smart, how adaptable your infotainment system is, you cannot
expect it to remain future-proof for almost 20 years. A dozen smartphone generations will
come and go during the lifecycle of a typical sedan. As a result, the British luxury vehicle
marque has adopted a strategy that is now prevalent across the entire industry: they
no longer install an expensive infotainment unit, including GPS, large display, and digital
radio – which can easily account for some 10 to 20 percent of the total price of a compact
class. Instead, the driver’s own smartphone is simply hooked up to the central console.
Once it’s plugged in, customers can use all the installed apps “that are not going to distract
them from driving, and that have our seal of approval,” states Ziebart. “The integrated functions are limited to the really essential ones; the ones the driver needs if they don’t have
their smartphone with them.”
The Jaguar-certified apps support a broad range of functions: music downloads, hotel
reservations, GPS route planning, calendar functions and messaging. Plus the smartphone
keeps track of the car’s precise location, how much fuel is left in the tank, and whether the
doors are locked. This approach has gained widespread recognition as the way to slice
through the Gordian knot – allowing frequent updates, efficient communications, and
seamless digital interaction with the vehicle and its surroundings.
In Germany, this smartphone-centric strategy has found favor with
Volkswagen, Mercedes, BMW and Audi. And it has become accepted wisdom that the connected car era calls for radically re-engineered business models: today’s tech-savvy consumers balk at buying
big-ticket infotainment systems that, even when brand new, are easily outperformed by iPhones and Androids – and that are completely outdated within years, if not months. It just won’t wash.
the automotive and ICT industries are
joining forces – but how?
So have car manufacturers and their established component suppliers waved the white flag in light of the advancing armies of Apple,
Google, Microsoft and Amazon? Are the proud auto brands of old to
be reduced to producing online platforms on wheels that simply serve
the lucrative business operations of the Internet players? Will they be
relegated to the role of contract manufacturer, fulfilling orders placed
by the likes of Google for its much lauded self-driving car – in much
the same way as Apple outsources production of its iPhone to Foxconn in China? Or will the IT specialists continue to serve their OEM
masters? The fight over the fate of the auto industry is in full swing.
Audi supremo Rupert Stadler told leading German newspaper Die
Süddeutsche Zeitung: “Car manufacturers alone have ultimate control over the in-vehicle operating-system platform. And that is not going to change.” The data generated by all these connected cars is a
precious asset that the manufacturers intend to fight tooth and nail
to retain. Just how they are going to turn this digital ore into digital
gold remains unclear, but the potential is undisputed. It could revolutionize the nature of the auto industry. Audi collaborates with
Google, for example, to improve navigation, but draws the line at invehicle ICT. They are unwilling to tip their hand to outsiders with regard to vital systems such as steering, brakes, and power-train. And
all leading car manufacturers are plowing significant funds into
keeping it that way. According to Matthias Wissmann, President of
the Association of the Automotive Industry (VDA), German OEMs are
expected to spend between 16 and 18 billion euros on connectedcar technologies over the next two years. As he is quick to stress,
“The only area to attract greater investment is carbon emission reduction.” The VDA estimates that, in the coming year, 80 percent
of all new cars will be connected to the Internet. As Wissmann
explains, “the quality of in-car connectivity is likely to play an increasingly important role in purchasing decisions.” And from 2018, when
all new cars in Europe must be equipped ex-works with the e-Call
system, the connectivity rate will max out at 100 percent.
<01> The COMAND
Online multimedia
system developed by
Daimler connects
Smart and Mercedes
cars to the Internet.
<02> BMW’s
iRemote app gives
carbon emissions could be cut by 30 perceNt
drivers status
To stay ahead of Silicon Valley, engineers and executives from
Detroit to Wolfsburg are working hard on new products and services.
Ulrich Eichhorn, Managing Director of Technology at the VDA, elaborates: “For example, cars will soon have the ability to recognize
vacant parking spaces, and to relay this information to other vehicles.” Eichhorn highlights the fact that 30 percent of inner-city traffic
is attributable to the frustrating search for a place to park. So a system of this kind could slash fuel consumption and pollution. “Leading carmakers could make this vital information available exclusively
to their own customers, or sell it to a third party.”
There is a real buzz surrounding the emergence of these novel
business models. But they are not the sole preserve of car manufacturers. Service providers, such as insurance companies, are also
getting in on the act. After all, pay-as-you-drive systems can
do more than simply measure the number of kilometers driven. Theoretically, the same technologies can be harnessed to monitor driving behavior, and identify favorite routes and destinations. This
raises serious privacy concerns. “We are going to run a field test
to establish just how much data is generated, and what we can
do with it,” admits an insurance company representative. But he
also concedes that the issue is highly contentious. As a result, the
organization has no intention of going public with their plans anytime soon. In 2007, a similar system garnered its founder the unwelcome, unloved Big Brother Award. In light of this kind of toxic publicity, the insurance industry has battened down the hatches.
Just exactly who owns, and controls, the data generated by all
these connected cars is a multi-million dollar question. The auto
industry points to the potential benefits of greater road safety and
a cleaner environment: researchers at Aachen University (RWTH
information from
<01>
iSeries models – via
a Samsung smartwatch.
<02>
Aachen) have calculated that improved traffic flows could cut carbon emissions by 30 percent. And they believe that the number of
road accidents could be reduced by a similar degree, simply by
introducing an automated road sign recognition system that
would issue situation-specific speed warnings.
To make these exciting new possibilities available to the
entire vehicle population, both new and old, Jörg Sasse, Vice
President of Sales, Connected Car, at T-Systems, would like to see
the introduction of retrofit packages: “Automakers need to find a
way to connect cars already on the road,” commented Sasse at
a conference held by German newspaper Automobilwoche in
Berlin. But how? “Cars will turn into mobile devices.” In other
words, smartphones on wheels.
At the same time, it is essential to ring-fence systems that are
key to a vehicle’s safety, and keep them separate from infotainment
components, for example. And the T-Systems expert offers an alarming statistic to illustrate his point: “Our global network of honeypot
systems detects more than 500 attacks every single minute.” As
he explains, you could not afford to have a situation where
a driver needs to slam on the brakes – but has to wait until the
in-vehicle IT module has verified the authenticity of the electronic
signal. “And imagine if cyber criminals could threaten to remotely
initiate an emergency stop. We’re talking about a realistic scenario,”
emphasizes Sasse. The Tesla Model S, the high-profile electric
sports car much loved by celebrities, has already been successfully
infiltrated. The hackers were able to access the vehicle by manipulating the keyless entry system and the corresponding mobile app;
they could also sound the horn and switch on the headlamps.
The stakes are especially high with self-driving cars. Little wonder that manufacturers and suppliers are working flat-out to build
focus
— 33
Automotive
impenetrable defenses. This is one of the key reasons why many
experts believe the concept of a robot taxi is a long way from
fruition. Mercedes recently unveiled a concept car at the CES
show in Las Vegas that allows the seats to be rotated through
360 degrees to let the passengers to face each other – while
the car drives itself from A to B. But no one representing the
Stuttgart-based automaker could be coaxed into giving an
approximate launch date for the technology. BMW boss Norbert
Reithofer is equally reticent. As, too, is VW CEO Martin Winterkorn.
A major problem is the liability conundrum: who picks up the bill
for an accident caused by a self-driving car? The user? The manufacturer? And there are still big technological hurdles.
<03> Bavarian auto
manufacturer Audi’s
TT and Q7 models
feature a fully-digital
virtual cockpit.
<04> This combines
high-quality 3D visuals
with tailored graphics
<03>
and information
offerings.
ONLINE 24/7 – AN ABSOLUTE MUST FOR
SELF-DRIVING CARS
Practically all senior executives agree: a driverless car cannot
afford to make a single mistake. The quality of the end-product
therefore takes precedence over the speed of development.
The upcoming generations of German flagships, such as the Mercedes S-Class, the Audi A8 and the BMW 7 Series, will boast an
array of autonomous functions, but they are still far from being
genuine robots of the road. But no matter how long the process
takes, once the self-driving jalopies arrive, they will be online
24/7, generating huge volumes of data. And they will need IT infrastructures with enormous processing power, and enormous
scalability – with the ability to cope with fluctuating traffic volumes
and patterns. Against this backdrop, T-Systems has recently built
one of Europe’s largest data centers, in Biere, close to the city of
Magdeburg in eastern Germany. As Luz Mauch, Senior Vice President of Automotive at T-Systems, confirms: “We are ready for the
huge demands that self-driving vehicles will bring. Even today, we
do not just host business IT systems. We increasingly operate secure, high-availability back-end systems that deliver telematics
services for automakers.”
For OEMs, suppliers and service providers, this is going to a
marathon, not a sprint, but with many milestones of achievement
along the way. In slow-moving traffic, today’s vehicles already automatically stop and start, apply the brakes, and keep in lane. And
systems are soon to go into production that can guide a car to a
vacant space in a parking garage – making it possible to drive to
the airport, get out, and leave the car to its own devices. As VDA
Director Eichhorn states: “We are not talking science fiction. This
is actually going to happen soon.” The components required,
such as cameras, radar, and ultrasonic sensors, are already standard equipment – soon to be joined by laser technologies for better recognition of vehicle surroundings. Moreover, these vehicles
continuously generate and update a digital map of the parking
garage, and make it available to all others participating in the
system. BMW presented an i3 prototype at the CES show in Las
Vegas that illustrated how this can be done.
Photos: BMW Group, media.daimler.com, Audi AG (2)
smart connectivity for new business models
If the vision becomes a reality, the valet parking guys who ply
their trade in front of LA’s casinos will have to seek alternative
employment. But the example underlines how existing technologies can be combined to create the basis for entirely new business models.ZF, the powertrain and chassis engineering giant
headquartered in Friedrichshafen, Germany, plans to acquire
TRW for 9.5 billion euros – primarily to gain access to US
company’s skills in electronics, and the capabilities needed in
the driverless age, such as collision avoidance, radar and vision
systems for situational awareness, and lane-keeping capabilities.
Driver assistance systems are evolving rapidly, offering ever greater safety and conveni-ence: they can already park the car, slam
<04>
“We increasingly operate secure, highavailability back-end systems that deliver
telematics services for automakers.”
Luz Mauch, Senior Vice President of Automotive at T-Systems
on the brakes when there is tailback, or swerve to avoid a jaywalker. According to a survey
of 8,800 European drivers by GfK on behalf of AutoScout24, the most sought-after
features are hazard recognition and intervention (82.1 percent), e-Call (81.9 percent) and
traffic congestion avoidance (77.3 percent). And there is still plenty more to follow: “If we
succeed in redirecting just ten percent of the vehicles approaching a congested stretch of
road, we can avoid a tailback from forming in the first place,” reports Eichhorn. In other
words, it is possible to advance from simply circumventing traffic jams to preventing them
entirely.
But it is not just vehicle manufacturers who are hard at work. They are looking for
expert assistance from app developers around the world. As Jaguar Group Engineering
Director Zebart highlights, “We cannot possibly keep up with the many thousands of
programmers working on software of this kind. We in the auto industry need to secure the
support of the application development community. Their backing will be decisive.” And
that is further powerful argument in favor of open, smartphone-based platforms. This is a
rationale shared by T-Systems expert Sasse: “Carmakers need to find answers to the
needs of the vast majority of drivers who want to access assistance systems via their
smartphones.”
But this requires a stable Internet connection. And to this end, Deutsche Telekom has
developed a retrofit solution, dubbed the Moving Hotspot. This package enables reliable
LTE connectivity for up to eight devices.
<Contact> joerg.sasse@t-systems.com
<Links>
www.t-systems.com/automotive
vda.de/en
Guido Reinking was Editor-in-Chief of Automobilwoche newspaper for nine years, and has been
covering auto industry issues and technologies for a total of two decades.
GAS STATION 2.0:
CLOUD-BASED AGILITY
AND EFFICIENCY.
Location-based services (LBS): geofencing
Special offers are sent to smartphones in passing
cars – provided the driver has given consent.
Mobile workplace for gas
station managers
Gas station operators can
deploy staff, complete
purchase orders and
perform similar tasks,
anytime and anywhere via
a mobile device.
Access to information
from a central point
Information from
specific gas stations can
be accessed directly
from headquarters.
WiFi hotspots
Customers can use WiFi hotspots
free of charge.
Desktops for customers
Desktops with Internet access
are available for customer use.
S
KA
E
SS
F
EL
CH
E
OU
CK
T
Self-checkout
Customers can pay at a terminal without
the assistance of a cashier.
1
Customer traffic analysis
Data on customer footfall is
analyzed in anonymized form.
C
PO
OU
N
Mobile payment
Customers pay using their smartphone:
multiple payment methods (credit cards,
gift certificates, etc.) are stored securely
in a digital wallet.
Coupons
Electronic gift certificates can be
scanned and redeemed when paying at
a terminal.
<Links>
www.t-systems.com/cloud-engine
cloud.t-systems.com
—
GPS dipping
The capacity of the fuel storage tank can be
determined from the tanker truck.
Location-based services (LBS):
Motionlogic
Traffic flows are captured, visualized
and analyzed in near real-time. The
resulting data can provide key
metrics – for example, the gas
station’s conversion rate.
Digital signage
Screens display current promotions and important information.
Their content can be managed locally or centrally.
CA
AS
RW
H
Efficient inventory management
Centralized inventory management
simplifies the replenishment of standard
products and fast-moving items.
Mobile e-commerce
Customers order via smartphone and
collect items at a defined pickup point.
Video integration
Staff at headquarters have access to security
camera footage to monitor gas pumps and
checkout lines.
Price alerts via app
Customers are notified via an
app when gas prices reach a
pre-selected, desired price.
Graphic: Stefan Mückner
Remote control via mobile device
Forecourt systems (such as gas pumps,
car washes, and price displays) are
controlled centrally.
“An offer we
couldn’t refuse.”
Heinek en C IO A nn e Te ag u e ta lks to Dr . Ferri A bolhas sa n ,
D irecto r of T- System s IT D iv i sion , a bo ut q ua lit y in the
dy n a m ic b e t w een peo ple , proc es ses and prod u cts .
focus
photos: christian Kerber
— 37
Interview
Mrs. Teague, when you took on the role of CIO at
HEINEKEN almost three years ago, how was the IT landscape structured? Was it doing its job?
AT: HeIneken has grown around the world through a large
number of major acquisitions, which meant the IT landscape
was very federated and diverse. So diverse, in fact, that it had
become difficult to manage. Creating a manageable landscape
was one of the first things we put on the agenda. We needed to
start consolidating. Obviously this very disparate landscape
was also having a negative effect on the quality of the services
that we could provide. The situation was entirely understandable when you consider the roadmap we were on – but nevertheless, it was something that I desperately wanted to change.
FA: Yes, we did have ups and downs. And I think it’s important to admit things like this in a partnership. When Anne
came in three years ago, we were at an all-time low in terms
of how our customers perceived our quality and service. But
the good thing is that we were both very open in our discussions about how to fi x it. And if you look at the latest figures,
the all-time low has brought about an all-time high.
“You haVe to buIld a relatIonshIp wIth proVIders and worK toGether daY-bY-daY to maIntaIn It – whIch Is what’s happenInG now.”
Anne Teague, CIO, HeIneken Group
The business
· HeIneken is the
world’s second largest
brewery group by
revenue
· Total production:
178 million hectoliters
· Revenue in 2013:
€18.4 billion
· employees: 85,000
What caused the performance glitches in 2012?
AT: We had no consistency in our operations, and the level of quality and
number of outages were simply not acceptable. But that was not 100 percent due to T-Systems, it was also down to the HeIneken crew. There
are always two sides to the coin. Some people in our organization took the
attitude: “We’ve outsourced this now, so we can sit back. And if things go
wrong, we’ll just beat up the provider.” But that’s not how it works. You
have to build a relationship and work together day-by-day to maintain
it – which is what’s happening now.
Mr. Abolhassan, the quality issues were not necessarily just a
problem for HEINEKEN. How has T-Systems’ delivery developed
since then?
FA: Last year we took a big step forward: we reduced the number of major
incidents among our top 25 customers by 50 percent. If we go back four
years in time, this number is even more impressive: compared to 2010,
we had 95 percent fewer major incidents in 2014. Achieving this level of
quality is a result of the dynamic between products, people and
processes. To address the issues at HeIneken, we first made sure we had
the right people on both sides. Then we clarified exactly which processes
we wanted to implement. Since then, we have backed these up with the
right platforms and products – including HeiHosting 2.0 and 3.0 for example. We left no stone unturned in our quest to improve quality and
build the relationship.
AT: Ferri makes an important point: you can have the best processes and
products in the world, but if you neglect the people aspect, you will lose
out. People are what made all the difference in our case.
What milestones have you achieved?
FA: That’s a broad question. Three years ago, HeIneken gave us around
40 points on its internal TRIM index. Today, we’re getting scores of
around 110. So we’ve almost trebled the original figure. This is a huge step
change: the difference is like night and day. And we’re seeing the same
trend with our other customers, too.
What, in particular, were HEINEKEN’s reasons for renewing the
agreement with T-Systems for a further six years, before it had
even expired?
AT: First of all, we noticed that switching the team had a really positive
impact on performance. At the same time, we were aware that technology, storage capacity, and related pricing had changed. So we asked you
guys to come in and make us an offer we couldn’t refuse.
Ensuring excellent quality and performance in the transition
and transformation phase is one issue. Delivering high stability
and availability in the live IT environment is another challenge.
How can IT providers achieve competitive differentiation in the
operational phase?
AT: Companies like HeIneken will never just outsource one aspect of
their IT; they will always have multiple outsourced tasks. And it is important for the partners who deliver these services to work together closely.
In my view, though, the relationship doesn’t stop at the data center or
dynamic workplace; the agenda is much wider than that. It also includes
applications, the help desk, and much more. You can only be successful
by creating a closely knit team – whether that’s through operational level
agreements (OLAs), regular monthly reviews, relationship building measures, or all three.
How does T-Systems live up to its promises of fulfilling its SLAs –
not only on paper, but in practice?
FA: In a word, it’s down to dedication. Generally in business, if you have
a stable system, it’ll run forever – more or less. The problems occur when
you start to change the system. At T-Systems, we deal with changes every
weekend and this is something that is inherent in our corporate culture.
In our case, the entire account management team and even senior employees are aware of what could happen – everybody plays a role in the
process. This is sheer dedication and it is integral to our culture. If a customer is implementing change, my entire team is involved in one way or
another. It is extremely important to us to have the customer, their needs
focus
— 39
Interview
To what extent does high-quality IT delivery pay for your digital
transformation?
AT: High quality is about having reliable IT systems – and that is our
No.1 priority. I have often discussed the importance of IT with the members of our board. If a brewery didn’t brew any beer for a day, it would be
a disaster. But if the IT systems went down for a day, that would be even
worse. We are growing ever-more dependent on automation supported
by IT. From that perspective, high-quality delivery is a business enabler
for HEINEKEN. Whatever we do, the quality needs to be extremely high.
And that’s why we need a reliable platform.
FA: Anne mentioned automation there and that is something we simply
cannot underestimate. IT has become an essential element of production
processes. Imagine if HEINEKEN was unable to make beer. I think you’ll
agree, that would be a disaster.
AT: An expensive disaster, indeed!
“It’s dedication that shapes our
unique mindset and forms the
foundation on which our triple P
approach – process, people,
platform – is built.”
Dr. Ferri Abolhassan, Director of T-Systems IT Division
and their possible pain points close to our hearts. This shapes our unique
mindset and forms the foundation on which our triple P approach – process, people, platform – is built.
AT: Yes, he is absolutely right. It’s about walking a mile in someone else’s
shoes. We have to put ourselves in our internal customers’ position, and
you guys have to put yourselves in my shoes. We’re all about selling beer
– simple as that. We’re not in the IT business, that is your job and you’re
much better at it than we are – which is why we ask you to deliver your
services to us.
Photos: Christian Kerber
Since you’re talking about brewing beer: how does increasing digitization impact HEINEKEN’s business?
AT: At our first IT Innovation Day held in January, we saw all kinds of
potentially useful digital developments. The enthusiasm at Heineken
is enormous. And the digitization agenda will be on a similar scale.
Big data will have a huge impact, and the consumerization of IT and the
Internet of Things will become increasingly important – especially since
we’re dealing with a product that is so close to consumers.
What is at the top of your digital agenda?
AT: Big data and data analysis. And I think that would apply for any food
and beverage company.
FA: Exactly. At the moment, it’s all about consumer habits. So big data
and gaining insight into customer behavior are key.
Talking of costs, how are quality and IT costs related?
FA: Downtime means extra costs – and that is the case for every customer. There is a direct correlation between reliability, stability and
quality. Service providers have no other choice than to deliver in line with
their contracts. But they can still be made to pay penalties. And they
often need to make additional investments to achieve the right level of
customer satisfaction. Since we launched the Zero Outage program,
we have increased T-Systems’ profitability by five percentage points –
a considerable amount. Previously, we had customers who were experiencing issues with quality, where we were almost making a loss. But now
that we’ve rectified the quality situation, without touching the contracts
at all, we’re seeing good results. This is partly because we no longer have
to pay penalties. But more significantly, it’s because we have reduced our
effort as we don’t have to ring-fence everything anymore. And the upshot
is that a satisfied customer like HEINEKEN wants to extend its contract
– which is great and represents a win-win situation.
AT: Yes, the customer needs to adopt this mindset too. I am not interested
in penalties; I just want high-quality delivery. Focusing on penalties and
criticizing the provider is the wrong attitude. And it impacts the motivation of the provider’s team. It’s as simple as that.
How do your costs compare to the industry benchmark?
AT: We are on a continuous cost-cutting journey. But it’s not about saving
money per se; it’s more about freeing up cash to invest in value-added initiatives. Take our Innovation Day, for instance; we would not have been
able to hold this event if the quality of our current delivery wasn’t up to par.
I need stable, reliable IT to effectively present my strategies and ideas to
the board. In order to innovate, you need to invest. But I don’t want to go to
the board and just ask for money. I want to explain my proposal and make
sure that we can achieve bigger and better things with the same budgets.
One of these innovations is your HeiHosting 3.0 program. Can you
tell us a little about it?
AT: Sure. It’s a huge program – a logical continuation of our HeiHosting
2.0 initiative designed to optimize all our SAP instances and reduce our
server landscape. That went so well that we launched HeiHosting
3.0 to address the non-SAP environment. Within the scope of this project, we’ve also identified another great opportunity that will increase
flexibility: the dynamic workplace. My generation embraced dumb terminals. Of course, I’m not going to compare the dynamic workplace to
dumb terminals, but these new solutions do offer a level of security, certainty and stability that we currently don’t have. Take the BYOD trend,
for example, if you’re working in Africa or Central America and still want
to be able to do your job properly, the dynamic workplace lets you. It is
a major game-changer for us. Because it allows us to embrace and
integrate large groups very quickly. If everything is localized, you don’t
have speed and flexibility. So HeiHosting 3.0 is our most important project this year.
“ferrI made an Important poInt:
You can haVe the best processes
and products In the world, but
If You neGlect the people aspect,
You wIll lose out.”
Anne Teague, CIO, HeIneken Group
Going back to quality, striving for high quality is an ongoing journey. How do you plan to improve quality in collaboration with
HEINEKEN with regard to implementing new services?
FA: As I said, the key thing is the culture of high quality within the team.
Secondly, you need clearly defined targets: set a goal, find the right team,
and then make a plan detailing how the team can achieve its aim. Let me
give you some more tangible facts about quality improvements: in 2014,
we ran more than 500 unannounced fire drills to test and enhance our
outage and disaster recovery mechanisms. We gained prior permission,
but didn’t give any specific advance warnings – so the systems had to
work. In addition, we awarded quality certification to 20,000 people
within the T-Systems ecosystem, including partners. In keeping with
our strategy of continuous improvement, this is renewed every year.
We are constantly asking: “How can we perfect quality?” And that will
never change. It is not really something that I or anybody else on the
management team drives or dictates, it is just a shared attitude that has
become part of our DnA.
In Germany’s key industries, such as the automotive sector and engineering, ‘made in Germany’ has become synonymous with high
quality. To what extent does this apply to the IT industry?
AT: From a data storage perspective, Germany has very strict rules,
which is a major benefit. Another key plus is the country’s structured,
thorough approach and the reputation of its technical universities. So I
would say that the ‘made in Germany’ label is a definite advantage.
FA: Let’s take the automotive sector as an example. German OeMs consistently deliver high quality worldwide – that’s why they are so well
respected. However, I actually believe that the IT industry has surpassed
them in terms of service. For instance: cutting-edge IT infrastructures
are expected to achieve 99.999 percent availability – no more than five
minutes’ downtime per year. Automotive players simply cannot live
up to these standards: just imagine if your car only had to go to the repair
workshop for a few minutes once every three to five years. CeO of VW
Ferdinand Piëch had a manic obsession for quality: every part of his
vehicles had to be perfect. His insatiable hunger for excellence has made
him a legend in the automotive world. However, in IT, customers expect
this level of dedication as a matter of course. And we have to deliver. This
constant demand for perfection has driven our industry forward.
AT: That’s why I said HeIneken is in the beer business, and not in the
IT business. Success in IT requires considerable specialist knowledge.
We need to know that investments are being made and that our systems
are in expert hands. For companies like HeIneken, this can make the
world of difference.
<Contact> roger.heusschen@t-systems.com
<Links>
www.t-systems.com/digital-age
heineken.com
photos: christian Kerber
What steps have you already taken in the direction of future workplace services?
AT: We’re initially rolling this out in europe. So we are talking about
25,000 desktop systems. But our other regions around the world are eager to get started, too.
FOCUS
— 41
Essay
Even if they rarely have
the humanoid traits of
R2-D2 and his companion
C-3PO from George Lucas’
Star Wars, robots are
used in a range of diverse
industrial applications.
When
robots have
their say.
INTELLIGENT ROBOTS IN SMART FACTORIES HAVE BECOME ICONS OF THE DIGITAL
ECONOMY. BUT THE INDUSTRY 4.0 INITIATIVE TAKES AUTOMATION AND CONNECTIVITY
MUCH FURTHER – AND THE BENEFITS ARE BY NO MEANS RESTRICTED TO LARGE
CORPORATIONS.
Photos: Imago/Unimedia Images
<Copy> Klaus Rathje
BEING CAUGHT DRUNK DRIVING IN THE USA does not automatically result
in a lost license as would likely be the case on this side of the Pond. In the
land of opportunity, the automobile is considered more vital to day-to-day life
than it is here. So American judges opt for a pragmatic, effective solution:
offenders must install an intelligent engine immobilizer in their vehicle. This
smart device can detect alcohol on the breath, and will only allow the car to
start if it registers that the driver is sober. The gadget, dubbed Interlock, is
the brainchild of north-German firm Dräger. It communicates directly with a
data center and if the drink drive limit has been exceeded, it notifies the
relevant authorities. This innovative solution is just one example of how
home-grown digital technologies are revolutionizing industries, and causing
a stir on global markets.
“German businesses are particularly good at integrating new technologies into products and processes,” explains Andreas Tschiesner, responsible
for Advanced Technologies at McKinsey in Germany. “After Japan, we deploy
the largest number of industrial robots in the world. This, of course, is closely
linked to the country’s relatively high personnel costs. But in general, people
here are keen to embrace smart connectivity.”
According to Tschiesner, another reason for Germany’s robotic prowess is
the widespread digitization in its engineering sector. “It used to be a very
rigid process. But today’s robots are much more advanced in terms of control and sensors. That means the risk of workers being injured by one of
these machines is extremely low.” This has led to changes in the robots’
design. The latest models are lighter and can be easily transported to a different site or assembly line, streamlining manufacturing processes. “Virtual
production” has become common parlance. Moreover, engineers can now
use advanced simulation technology to test entire automated production
lines featuring multiple robots before they are even built. This enables them
to nip any potential problems in the bud – extending the lifecycle of these
costly assets. Sophisticated digital troubleshooting helps pave the way for
faster, hassle-free deployment of robotic systems.
Analysts have also acknowledged Germany’s strengths when it comes
to the integration of IT solutions into specific manufacturing processes. The
country’s automotive industry is particularly noteworthy, both in terms of its
<01>
<01> Robotics technology enables
engineers to simulate and test
entire production lines, helping
them identify errors early on and
streamline collaboration between
humans and robots.
<02> In the Pixar movie WALL·E,
a little worker robot falls in love
with another machine. The latest
generation of real-world industrial
robots communicates on the basis
of sensors, actuators and smart
connectivity – less emotional but
highly intelligent.
automated production lines and its role in driving digitization, or the connected
car, as it is commonly known. Tschiesner remarks: “German automakers have
definitely recognized the importance of in-vehicle connectivity. And they are
working flat-out in collaboration with IT partners to develop their own solutions, so as not to be dependent on US giants such as Google.”
The Internet colossus is a good example of US pioneering spirit. The search
engine provider is making inroads into the robotics industry, with billion-dollar investments. Google already has eight robot manufacturers to its name,
securing its part in this key growth market.
Google has been a forerunner in the intelligent analysis and integration of
data for many years. However, USA-based business automation experts
Automic recently looked at the way companies analyze their own data. They
surveyed senior executives from financial services, utility, retail and telecommunications companies in Germany, the UK, France and the USA.
According to the study, German enterprises are ahead of their American
cousins with regard to big data analytics. A whopping 73 percent of German
firms have already drawn up a big data strategy or are in the early stages of
implementation. In the USA, the figure was 70 percent – a clear difference.
Similarly, only 18 percent of German decision makers who plan to leverage big
data are yet to develop a concrete plan of action – the lowest number in the
survey. By contrast, almost a quarter (23 percent) of US companies still have
no idea how they will harness this valuable resource. So it seems Germany has
a definite edge when it comes to big data.
As Tschiesner stresses, “We mustn’t forget that there is still room for improvement in training for software engineers in Germany. We have significantly
fewer developers who specialize in big data and predictive analytics.” The
basics are often lacking. He points out that large corporations such as Bosch
often work around this problem by establishing their analytics departments
elsewhere, in India for example.
Midsized players have a much harder job keeping up with modern technologies. And this was precisely what led three business administration students from Kiel University to found GPredictive. Björn Görke, Dennis Propper
and Philippe Take recognized the huge potential of big data several years ago.
<02>
— 43
Essay
“AFTER JAPAN, GERMANY DEPLOYS
THE LARGEST NUMBER OF INDUSTRIAL
ROBOTS IN THE WORLD.”
Andreas Tschiesner, McKinsey Germany
As Görke explains: “Business owners must truly understand the data they have
in order to be able to use it properly. Anyone can divide their customer base
into A, B and C types. But how do they identify the patterns that will help them
predict future consumer behavior? That is a great deal trickier. And it is often
the reason that midsized companies get left behind in the big data and predictive analytics stakes.” But the Hamburg-based startup is helping family-run
businesses and SMEs take their first steps toward Industry 4.0-level connectivity: “We’re enabling even the smallest of organizations to implement these
technologies without the high investment costs. The benefits that large corporations have long enjoyed should not be off-limits to their smaller counterparts.” One such company recently tasked Görke and his nine-piece team with
finding out which of its customers it was worth sending a catalogue to. As a
result, the business has doubled its response rate and has seen a four-fold increase in orders.
And success like this does not go unnoticed. In February this year, a venture capitalist based in Munich injected 2.5 million euros into Görke’s analytics
business. Progress indeed.
<Link>
www.t-systems.com/industry-4-0
According to studies and
global comparisions, Germany
is forging ahead in the
deployment of robots and the
strategic implementation of
big data solutions. However,
when it comes to the development of predictive analytics
software, German businesses
still count on the support of
overseas experts.
Photos: Spencer Lowell/TRUNK, ddp images, traffic analyzer/Getty Images, Boston Dynamics/Bestimage, clickHere/Shutterstock
FOCUS
Sizzling ideas
for tomorrow.
AROUND THE WORLD, DEVELOPERS AT DEUTSCHE TELEKOM’S INNOVATION
LABORATORIES (T-LABS) ARE WORKING ON SOLUTIONS FOR THE HOMES
AND WORKPLACES OF THE FUTURE. AT A SITE IN ISRAEL’S NEGEV DESERT,
ENGINEERS BENEFIT FROM THE NATION’S COLLECTIVE SPIRIT: COURAGE,
A THIRST FOR KNOWLEDGE, AND A UNIQUE JOIE DE VIVRE.
<Copy> Laura Hamdorf
— 45
Feature_Tel Aviv
Creativity, a
willingness to take
risks and laid-back
exchange characterize Israel‘s young
entrepreneurs.
Failure is not a flaw.
Everyone knows
how unpredictable
life can be.
A 60-HECTARE UNIVERSITY CAMPUS around two hours’ drive
south of Jerusalem. The wind is whipping sand into the air,
obscuring the institution’s flaming orange logo. And as is often
the case in spring, the white limestone of the nearby Hebron
mountains is barely visible. The hazy view from the glass buildings promises another scorching summer. This means temperatures of up to 48° Celsius, humidity below 20 percent and a
southerly wind so dry that it catches the back of your throat. On
the parking lot of the local supermarket, camels lie between the
cars, patiently waiting for their owners to return.
Nestled in the desert is a celebrated center for research and
learning. You’d be forgiven for thinking young people might
choose a more favorable place to study and relax. But the BGU is
one of Israel’s leading universities. Its full name is Ben-Gurion
University of the Negev. And its reputation, both for student lifestyle and as a research institute, is second to none. Digital natives
from around the world flock to the city of Be’er Sheva to continue
their quest for higher knowledge – a quest represented by the
interlocking flames of the establishment’s logo. A maximum of
20,000 students are accepted each year. Some of them, like
Dr. Yuval Elovici, never leave.
“We work in a fast-paced, high-tech ecosystem, brimming
with life and innovation,” says the 48-year-old. And he should
know. Elovici was born in Be’er Sheva, and is one of the
city’s 200,000-strong population. Today, he is Director of
T-Labs@BGU, Deutsche Telekom’s Innovation Laboratories at
the university. Elovici studied electrical engineering and information technology here and, after completing his PhD, opted to stay
in academia. He is now a professor at the Institute for Information
Systems Engineering.
Elovici’s employer specializes in security and smart data,
with a particular focus on the development of new solutions for
digitization, cloud computing, broadband, virtualization and
standardization.
Photos: age fotostock/Look Foto, Municipality of Tel Aviv
FOCUS
T-Labs
In 2014, T-Labs celebrated
its 10-year anniversary.
To mark the occasion, key
projects from the last
decade were highlighted,
including DSL Community,
an initiative to consolidate
the broadband connections
of multiple households,
and a set-top box that
runs in the cloud. In 2012,
T-Labs pioneered a
512 Gbit/s data transfer
over optical fiber, which is
equivalent to transferring
77 music CDs at one time.
“THIS IS A UNIQUE ECOSYSTEM. A ONE-OF-A-KIND
COLLABORATION BETWEEN A GERMAN BUSINESS
AND AN ISRAELI UNIVERSITY.”
Yuval Elovici, T-Labs Director
BGU and T-Labs, affiliated to TU Berlin, are prime examples of
how Israel has developed over recent decades. The country has
evolved from a socialist agricultural nation – symbolized by a
thick-skinned Jaffa orange – to a high-tech superpower. During
its transformation, it has witnessed seven wars, two intifadas and
a nine-fold spike in population to over 8.2 million, as well as
having to overcome the hurdles of extensive bureaucracy.
Buoyed by its unique historical and political situation, Israel
invests around five percent of its gross domestic product in
research – more than any other country. The military is a driving
force behind the high-tech industry, which has become synonymous with robust economic growth and low unemployment,
and which now accounts for 50 percent of the country’s exports.
The Israelis are incredibly proud of their successes in this
field. The technology sector is the reason that ratings agencies
such as Standard & Poor’s consistently award the country an A+.
When it comes to developing IT innovations, Israel and the USA
are way out in front. “Israel is a young country and we have no
traditional industries such as car making. So we needed to make
the most of exciting new opportunities,” says Avner Warner,
Economic Director of the Global City Tel Aviv campaign. “The
people here are laid back,” he continues, “They meet in cafés to
exchange ideas. It’s a very creative environment. No matter how
crazy your idea, no one laughs at you.”
Israel is renowned for its positive entrepreneurial approach.
With over 4,000 startups, the country has the highest density
of new businesses in the world. An international comparison per-
formed by Startup Genome puts Tel Aviv second only to Silicon
Valley as an ideal place to launch a new venture. “You can sense
the buzz and freedom of this city and it spurs you on and wills you
to try your luck,” says Asaf Hachmon, founder of Tel Aviv design
startup Famuza. “And if you don’t succeed the first time, then perhaps you will the second.” Failure is not flaw. Everyone knows
how unpredictable life can be. Missile fire is a regular occurrence
here. But just the same as in the business world, “surrender is not
an option: we don’t give up.” The Yiddish word chutzpah, meaning the audacity and courage to try again, has become the watchword of an entire generation of ambitious entrepreneurs. But living and working in Israel doesn’t come cheap. Employees work
more but earn less than the OECD average. Currently, monthly
salaries are around 9,200 new Israeli shekels – approximately
2,000 euros. Perhaps this fact makes people more willing to take
the plunge and go it alone. But even though it might sound simple, setting up shop in Israel is not a walk in the park. Rents are
particularly high in the burgeoning city of Jerusalem and, although it is less than half the size of the capital, Tel Aviv is costly,
too. Very few people can afford their own office space.
Nevertheless, the city boasts 700 startups in the Rothschild
Boulevard district alone. Intel, with its workforce of 10,000, is
the country’s biggest private-sector employer, and Facebook,
Microsoft and Google also have their national headquarters in
FOCUS
— 47
Feature_Tel Aviv
Yuval Elovici and his team at
T-Labs@BGU are currently
developing security mechanisms designed to protect
against cyber attacks.
Young creative thinkers flock
to Tel Aviv’s shared working
spaces, such as the municipal
library, to exchange their ideas.
Projects like these are funded by
Photos: Dagmar Schwelle/Laif, Deutsche Telekom AG (2), Municipality of Tel Aviv
the Israeli government.
Tel Aviv. Apple chose the city as the site of its first research center
outside the USA. All of these companies have one thing in common: a keen interest in the startup scene. Analysts from outside
the metropolitan region of Tel Aviv refer to it as Silicon Vadi. The
moniker, though, is not entirely accurate: Vadi is the Arabic word
for a dried-up river bed. But this is the epicenter of startups –
entrepreneurial spirit and a willingness to take risks are more
prevalent here than in any other city on earth. The Israeli government provides a helping hand, fostering creativity by offering free
mentoring programs and communal open-plan office areas like
at Tel Aviv’s municipal library, a public workspace with a view
across the Mediterranean Sea.
Researchers and students from multiple IT disciplines, including information systems, engineering, computer science,
industrial engineering and management, bring a wealth of expertise to BGU and T-Labs. Faculty staff impart their knowledge
to post-doctorate, PhD and MSc students. T-Labs functions much
like any other university institute, but with a far greater crossdisciplinary focus than elsewhere. Professors attract PhD students
from various academic backgrounds – but all have a particular
interest in IT. The T-Labs site, itself a part of Deutsche Telekom’s
central R&D work, is a creative hub that welcomes unique ideas
and input from everyone. This enables fruitful, creative exchange
between teaching staff and the 70 masters and PhD students.
BE’ER SHEVA: AN IT SECURITY HOTSPOT
This unique collaboration between a German corporation and an
Israeli university is turning heads in business and politics around
the world. Professor Elovici explains the attraction: “On the one
hand, you have traditional engineering and an awareness of security issues. But on the other hand, the enthusiasm of the students
provides impetus for research and new ideas.”
At present, Elovici and his team are working on a project
called Network Device Honeypot, which identifies potential attackers and entices them into traps. All threats are documented and
neutralized. The initiative aims to improve data security and find
out whether IT infrastructures are at risk when supply chains are
extended to multiple partners.
In Elovici’s view, this project is essential. “Attacks are becoming
progressively better and more destructive and new vulnerabilities
are being uncovered every day.” He sees two major security loopholes: first, the Internet of Things that connects multiple devices,
including wearable computers. “This is dangerous because not all
of these devices are protected.” An attack can be aimed at one
particular machine but it can also use a device as a vehicle to attack another target. Elovici’s second project deals with connected
mobility and self-driving cars. “The main objective here is to thwart
cyber attacks on cars.”
COLLABORATION BETWEEN GERMANY AND ISRAEL
Employees at T-Labs@BGU create security solutions hand-in-hand
with their colleagues in Berlin. Klaus-Jürgen Buss is in charge of
the site in the German capital. But he also knows BGU well: from
2010 to 2012, he headed the T-Labs site there. Buss attributes its
success to its excellent location. “The people in Israel are ambitious, quick-thinking and can handle conflict situations. As the
country has no raw materials to export, IT and digitization are especially important,” he stresses. His colleague Gil Rosen, Head of
New Media at T-Labs Berlin, hails from Israel. Rosen and his fellow
Israelis are used to thinking outside the box. And this attitude is in
demand in Berlin, too: twice a year, T-Labs project Face the Future
identifies issues that will serve as a trigger for innovative projects
related to IT infrastructure, digitization and Industry 4.0.
“We no longer work on end products – instead we focus on
the solutions at the heart of Deutsche Telekom. The results of our
efforts are immediately incorporated into the company, improve
local infrastructure, and are frequently used as a foundation for
new business ideas on worldwide markets,” says Buss.
<Contact>
laboratories.info@telekom.de
<Link>
laboratories.telekom.com/public/english
best practices
Salesforce
Business apps from a
made-in-Germany cloud.
The attraction of downloading apps from an online store is clear: it’s quick, convenient, and affordable. But even for consumers, this kind of
software comes with certain risks. Where is the data stored, how is it processed, and how secure is transmission? Understandably, businesses
have high security standards for cloud-based apps. Moreover, they have to ensure seamless integration with the corporate IT landscape.
<Copy> Roger Homrich
IN THE SUMMER OF 2014, Salesforce CEO and founder Marc Benioff welcomed customers and partners to the Salesforce 1 World Tour in Munich. Next
to him on the platform was Deutsche Telekom CEO Timotheus Höttges. The
inventor of cloud-based CRM and Europe’s leading ICT service provider –
Salesforce and T-Systems – had come together to unveil a new partnership,
combining the best of both worlds: German cloud computing married to the
planet’s most successful CRM solution. And the timing is perfect. More and
more major enterprises are deploying SAP for their back-end, and Salesforce
for the front line: for interaction with their customers.
Michael Müller-Berg, responsible for the Salesforce alliance and the partner sales program at T-Systems, states: “Customer relationship management
generally involves personal information. As a result, many user organizations
want data to be processed and stored in Germany.” Starting in the second
half of 2015, T-Systems will provide resources for Salesforce solutions from a
data center in Germany. In other words, Salesforce users and their customers
in Berlin, Stuttgart and Hamburg can be sure their data remains subject to
domestic privacy legislation.
But the alliance with Salesforce will be about much more than just a secure
data center, and joint sales and marketing efforts. It is about the heightened
needs of business apps in comparison to smartphone software for consumers.
For instance, the apps and the front-end need to operate with total reliability,
and interact seamlessly and securely with the existing IT landscape. For example, the cloud-based Salesforce CRM solution has to dovetail neatly with
the ERP back-end. With this aim in mind, T-Systems partnered with Informatica
to develop Data Orchestration as a Service (DOaaS), a powerful data integration offering. It builds bridges between siloed applications within IT environments at leading corporations – that typically run 500 diverse systems. DOaaS
users simply select the applications they wish to splice, and link them via dragand-drop. The GUI gives them complete visibility to all connections. And as
T-Systems has already built an extremely rich ecosystem of cloud partners,
Best Practices
Salesforce
— 49
such as salesforce.com, VMWare, SAP, Microsoft and Cisco, it is well placed to
deliver a truly end-to-end service.
Key tasks include data synchronization, and formatting for delivery to diverse form factors, such as those found on tablets, smartphones and desktops.
The imperative is one version of the truth for all. The executive at headquarters
needs the same information at the same time as the guy giving his sales pitch
out in the field. And that plays to a key strength of Salesforce: speed paired
with simplicity. There is no need for complex, clunky software. Instead, sleekand-slim apps take selected data, and identify relationships – which are then
visualized in attractive, user-friendly form. It enables the efficient automation of
regularly recurring tasks. As Müller-Berg states, “it isn’t just about us operating
Salesforce in one of our German data centers. In conjunction with our partners,
we are developing and marketing industry-specific apps for CRM, service
management and marketing built around the Salesforce platform.”
Photo: Jon Boyes/Getty Images
How much is that beamer in the window?
Not so long ago, consumers would choose a car marque and dealership, and
if they were satisfied with what they got, they stuck to them. For years. That is
no longer the case. Currently, around half of all customers turn their backs on
their dealership of initial purchase once the warranty has elapsed. So more has
to be done to improve customer interaction, and to leverage all the possibilities
of today’s communications channels. What’s more, today’s drivers expect to
be served when it suits them, not the business – and are more than just a mite
miffed when they take a trip to the showroom on a Saturday morning, and find
30 potential purchasers jostling for the attentions of just three sales staff. After
a frustrating non-encounter, they turn on their heels and leave, never to return.
And this is where the partnership with Salesforce comes into play. For example, with Showroom Proximity, a solution developed by T-Systems. The cars
on display are fitted with iBeacons – miniature transmitters that use Bluetooth
to transfer information to nearby smartphones. They can be harnessed to deliver guidance on a vehicle’s specifications, or on financing options and leasing packages. The corresponding smartphone app can be used to arrange a
test drive, or to request a call-back. The result is a completely new, and more
positive, dealership experience. Face-to-face interaction and the physical presence of actual vehicles remain vitally important – but can be supported and
enriched by digital photos, data sheets, videos and new forms of interaction.
And it’s not just better for the customer. It’s better for business. Sales professionals can subsequently review the data to identify which customers were
most interested in which products and services – and can target and tailor their
follow-up communications accordingly.
Showroom Proximity is part of T-Systems’ dedicated Customer Experience
Management (CEM) platform for the automobile industry. The goal of CEM,
created in close cooperation with Salesforce, is to create better, bolder ties
between dealerships, repair shops, vehicles and customers. The platform also
includes modules entitled Service Tracking and Service Check. The former
documents vehicle movements and work progress during the vehicle servicing process. For example, a mechanic can tell at a glance which customerowned car is in which service bay, and where courtesy vehicle 42 is parked.
Service Check enables customers to become more directly involved in
repair shop activities. When they arrive to hand over their car, they are given a
tablet to view a checklist. They can then decide for themselves which tasks
they want performed on their car. Studies suggest that this more participative
approach can boost repair shop revenues by as much as 18 percent.
<Contact> Michael Müller-Berg: mmb@t-systems.com
<Links>
t-systems.com/cloud-made-in-germany
salesforce.com/eu
Making the move to all-IP
SPEAKING
THE SAME
LANGUAGE.
<Copy> Angelika Keller
CLOUD COMPUTING, MOBILITY SOLUTIONS, INDUSTRY 4.0: these are
the innovations currently driving strategic business planning – with the automotive sector, logistics, and manufacturing leading the way. But without a
powerful and flexible telecommunications infrastructure, such technologies would be inconceivable. With the dawn of big data, dynamic cloud and
collaboration solutions, wireless machine-to-machine (M2M) communications and the Internet of Things, it is estimated that by the end of the decade, networks will have to carry up to 50 times more data than they did in
2014. However, today’s infrastructures are not equipped to handle these
loads. Some 400 million M2M connections are already up and running
globally, and this number is rising fast: from vehicles communicating their
position and fuel status in car-sharing programs, to medical devices that
send data directly to doctors, and home management systems that allow
residents to control domestic appliances remotely. As digitization continues
to make inroads into our day-to-day lives, anything that can be connected
will be connected. And this is laying the foundations for countless new business models.
IP: DRIVING THE DIGITAL BUSINESS REVOLUTION
Against this background, carriers around the globe are working on switching
their infrastructure to IP. This simple, standardized protocol supports all forms
of communications – telephone, cell phone, data, Internet, fax, TV –
allowing all networks to speak the same language. The clear advantages of IP
are leading to the gradual wind-down and replacement of older systems.
Based on current plans, Germany’s public switched telephone network
(PSTN) and offerings deploying the asynchronous transfer communication
mode (ATM) will only be available to Deutsche Telekom customers until the
end of 2018. Moreover, synchronous digital hierarchy (SDH) multiplexing
technology is due to be phased out by the end of 2020. At the same time,
broadband network gateways (BNGs) are being implemented as the basis for
IP products. For businesses, the question is no longer whether they should
make the move to IP, but rather when and how. “No company will be able to
get around IP,” Dan Bieler, Principal Analyst at Forrester, is convinced. “Rather
than simply focusing on the cost of migration, it is advisable to think in terms
of the opportunities and benefits that the technology offers. These clearly lie
in the possibility to implement digital business models that meet high mobility
requirements, based on integrated IP-based applications.”
BEST PRACTICES
ALL-IP
— 51
Interview
ALL-IP IS AN ENABLER
FOR DIGITIZATION.
Dr. Markus Müller,
CIO of Deutsche
Telekom and member of
the Board of Management at T-Systems
What do businesses stand to gain by making the move to IP?
As the digital economy gathers speed, the challenge now is to
create new business models by tapping into the potential of ICT.
IP is a standardized technology that can act as a basis for these
new models – making it a key driver of future business development. Moreover, as IP products are based on the latest innovations, they enable providers to deliver services to users far more
quickly and efficiently.
Photos: Mareen Fischinger/Deutsche Telekom AG, Shutterstock
UNLOCKING THE POTENTIAL OF IP TRANSFORMATION
Stephen Wilson, Senior Analyst at Analysis Mason, also views the end of
PSTN and time division multiplexing (TDM) networks as inevitable. “However, not all providers recognize the necessity for a proactive approach to IP
transformation with a clear implementation schedule,” he explains. With its
All-IP program, T-Systems is preparing itself and its customers for the transition, and the first products for business customers are slated for launch this
year, as is the case with Deutsche Telekom. And over the past year, customers have had the opportunity to attend workshops and expert seminars
where they can learn about the potential of IP networks and how to make the
move. A starting point when planning migration is to evaluate existing inhouse systems and applications and assess their IP compatibility. “The real
potential of the switch to IP is that it provides an opportunity to align overall
IT strategy with strategic business goals – and to set a course towards digital
transformation,” concludes Dr. Markus Müller, CIO of Deutsche Telekom.
And that is where the future lies.
<Contact> werner-eduard.gabriel@t-systems.com
<Link>
www.t-systems.com/telekom/all-ip
What is the status of IP migration for T-Systems’ corporate
customers?
Deutsche Telekom and T-Systems have put a lot of work into
roadmaps for corporate customers and have developed a broad
support offering for migration, covering everything from customer-specific consultations to workshops with industry experts. The approach must be as multifaceted and diverse as the
communication landscapes in each individual company. We
have already switched over five million households to IP, and we
are drawing on this experience for migrating our corporate customers’ systems.
Do you have any IP migration tips for other CIOs?
As with any project, good preparation is the key to successful
implementation. Today’s solutions are often not equipped to
deal with future changes – and the switch to IP can ignite a rethink of a company’s entire ICT strategy. I would advise CIOs to
use the opportunity to set a new course for their ICT landscapes,
so that they can benefit from the possibilities of IP from an early
stage. A provider like T-Systems can deliver valuable support: in
addition to industry insight and ICT expertise, we can offer indepth knowledge of each individual customer’s requirements.
Empowering service engineers
leVeraging TaBleTs To saVe Time.
Each and every day, Deutsche Telekom’s field engineers are to be found the length and breadth of Germany. They install and maintain
the components that make up an ever evolving network. Since 2014, the field engineering service (Deutsche Telekom Technik) has been
leveraging a tablet solution to schedule and coordinate assignments, maximizing the time that team members spend on their core tasks.
<Copy> Roger Homrich
JusT a FeW monThs ago, lars müller would have to make multiple trips
every day to the field engineering team’s regional office. and he would need to
stop off frequently at the spare parts store. using a very basic handheld device,
he would print out his assignments – including a route plan – which he would
later use as a basis for reporting his travel and work progress for that day. only
then could he set off and get down to work in the field.
since June 2014, he has spent far less time returning to base camp. and
he saves a significant amount of time. he drives directly to his first job of the
day, without a single sheet of paper in sight. his task: to maintain one of the
thousands of street cabinets (those grey metal boxes at the side of the road)
to be found throughout germany. These house equipment used to deliver
telephone and internet services to customers from Flensburg in the north to
Füssen in the south. every day, lars müller and his colleagues complete tens
of thousands of assignments of this kind.
DIRECT LINE TO THE PARTS WAREHOUSE
a further key strength is the ability to communicate directly with the spare
parts warehouse. The field engineers’ vans are equipped with a predefined
number and type of spare parts and tools. Before the arrival of the tablets,
they would have to check which components and consumables they had
used, and therefore needed replacing, every evening. Today, the process is
automated, greatly increasing convenience and accuracy. on completion of
each assignment, the quantities of material used by the engineer are recorded, and a replenishment order generated. The back-end system processes
the order, and a logistics service delivers them directly to engineer’s van.
The tablet is far more powerful, and significantly more user-friendly, than
the handheld it replaced. This has greatly increased acceptance and adoption
of the new functions.
<Contact> marco.juntorius@t-systems.com
FLEXIBLE STAFF DEPLOYMENT
<Link>
telekom.com/home
The solution also boosts back-office efficiency. equipped with their tablets,
deutsche Telekom’s engineers can transmit details of their progress to the dispatchers from any location. That eliminates the need to type up reports, and to
submit them as hard-copy documents. The result is far less paper, and much
greater productivity. and as lars müller explains, “The system can also calculate
the best route for me to take for my particular assignments. and because it is
continuously updated, it keeps me flexible.” The ability to make scheduling
changes on the fly is important because he often has to squeeze in additional
jobs at short notice – and they could be anywhere in his allocated territory. in the
past, dispatchers would struggle to monitor and coordinate field assignments,
especially as the workload situation was in constant state of flux. now, real-time
information transfer gives them complete transparency.
The powerful, compact devices also help field engineers to document their
work. They no longer have to write down where they have been and how many
kilometers they traveled by hand in physical logbooks. The route planning functionality automatically captures and displays journey departure and destination
points. The engineers simply check the suggestions, make any minor adjustments, and transmit the data to the back-end system via a wireless connection.
AUDIT-PROOF DOCUMENTATION
Work reports are now totally digital. as peter stirnberg, head of production
support at deutsche Telekom’s field engineering unit, explains: “They used
to have to commit everything to paper and then enter it into the software back
at the office. Today’s streamlined solution combines the work assignment
and the data generated automatically on the vehicle’s movements, saving time
and minimizing errors.”
The tablets are also highly useful out in the field. The engineers use them
to take photos, add comments, and save the corresponding files in audit-proof
form. They can also access additional resources, such as maps and network
plans, that show cable routings, for example. These are supplied by the dispatchers. The data is also available offline. mobile access is provided via a secure virtual private network (Vpn) that utilizes tunneling and data encryption.
Equipped with their
mobile tablet-based
solution, Deutsche
Telekom’s engineers
can transmit details
of their progress to
dispatchers from any
location.
best practices
News
— 53
ThyssenKrupp
Photos: Sascha Deforth, T-Systems, imago/Westend 61, ThyssenKrupp AG (2)
ThyssenKrupp cloud
migration.
In 2012, ThyssenKrupp launched a major restructuring initiative, and is already
reaping tangible benefits. In 2014 alone, its share price increased by significantly more than 20 percent – a satisfying result for both the company and its
investors. Germany’s leading steel and technology corporation has also implemented the unITe consolidation program to harmonize and standardize its IT,
with a focus on cloud solutions. Within the scope of this project, T-Systems
will migrate approximately 80,000 desktop PCs and 10,000 servers, situated
across 34 countries. “Our goal is to establish a seamlessly integrated, enterprise-wide IT landscape, making global collaboration easier and more efficient,
while also meeting each division’s specific needs,” states Klaus-Hardy Mühleck,
CIO at ThyssenKrupp. In late 2014, T-Systems began transferring the company’s
IT processes and services from approximately 700 server rooms and 11 data
centers to five twin core data centers located around the globe. Workplace services, including applications such as Microsoft Exchange, Microsoft SharePoint,
and Microsoft Lync, will be provisioned directly to ThyssenKrupp employees from
a highly-secure T-Systems cloud.
<Contact> dirk.lukaschik@t-systems.com
FireEye
real-TIme, DynamIC
PrOTeCTIOn by fIreeye.
T-Systems is collaborating with cyber security specialists fireeye to provide
enterprises with a fully-managed real-time security platform. It is the first time
this cutting-edge SaaS technology has been deployed in europe. Conventional detection solutions only react to known signatures. as a result, corporate
network breaches go unnoticed for a median of 229 days. fireeye’s platform,
by contrast, identifies and nullifies them in minutes. a purpose-built virtual machine analyzes the behavior of suspicious files by directly executing them in a
sandbox. It then harnesses best-in-breed technologies to perform forensics, and
to disarm web and email attack vectors, hidden malware, and zero-day threats.
fireeye technology will enhance the advanced Cyber Defense by Deutsche
Telekom (aCD) security portfolio developed by T-Systems. This offering includes integration and operation at the customer site, and monitoring and
analysis of all events.
<Contact> karl-friedrich.thier@t-systems.com
Excellent quality and reliability
CuSTOmer Survey COnfIrmS SuCCeSS
Of zerO OuTaGe InITIaTIve.
excellent
good
average
poor
T-Systems has maintained its high level of quality: for the second consecutive year, participants in the TnS Infratest TrI*m customer
satisfaction survey rated the ICT provider as excellent. This means
T-Systems again ranks among the top 10 percent of european ICT
providers. The positive outcome and a response rate of 60 percent
underline that customers value T-Systems’ reliability and excellent
results, and view the organization as their provider of choice. “We are
extremely proud that our customers recognize our commitment and
high quality. The survey also shows that our zero Outage initiative, which
aims to reduce errors to a minimum, is being accepted and valued,”
explains Dr. ferri abolhassan, Director of the IT Division. last year,
700 quality-enhancing measures were put in place in response to
customer feedback. and T-Systems is continuously improving.“We hope
that as many of our customers as possible will contribute to the TrI*m
survey in the future,” stresses abolhassan.
<Contact> marco.dubanowski@t-systems.com
best practices
News
— 55
T-Systems and SugarCRM joining forces
Cloud-based
customer relationship
management.
Digitization is making customer interactions more dynamic. Moreover, businesses have recognized the growing importance of building and maintaining
close and lasting relationships. Against this background, flexible CRM systems
and automated customer-facing processes are becoming increasingly vital
to success in today’s highly competitive environment. This is where a new
cloud-based application from SugarCRM comes into play. It offers an innovative, customizable and highly cost-effective platform for the management of
customer relationships. This easy-to-use solution is scalably provisioned in line
with changing needs from a highly secure T-Systems data center in Germany.
Photos: James Brey/Getty Images, Shutterstock (2)
Expert advice and assistance
The app supports relationship management activities in sales, marketing and
customer service. Data can be captured and consolidated across multiple
touch points by means of standard interfaces to merchandise management
systems, ERP software and online stores. This grants end-to-end visibility, opening up new opportunities for targeted communications with specific customers
or customer groups – without the need for upfront investment in dedicated
IT resources. On request, the SugarCRM solution can also be installed and
operated on-premises.
T-Systems is responsible for marketing and operating the cloud-based solution,
and will initially focus on Germany, Austria and Switzerland. In cooperation
with carefully selected systems integration partners, the Deutsche Telekom
subsidiary will be providing advice and assistance on all aspects of the CRM
platform’s design and implementation.
<Contact> volker.von-kolczynski@t-systems.com
Data orchestration as a service – DOaaS
T-Systems and
Informatica combine
their strengths.
T-Systems has joined forces with Informatica, the world’s leading
independ-ent provider of data integration software, to provide cloudbased data orchestration as a service (DOaaS). The Californian vendor’s
solution synchronizes data across multiple enterprise applications,
whether they reside on-premises, in a private cloud, or in the public
cloud. It can integrate and manage data stemming from both local and
cloud-based applications. T-Systems is the first partner to implement
Informatica’s DOaaS offering in high-security data centers based in
Germany. Customer benefits include high availability, rapid provisioning,
and cost-effective up- and downscaling.
<Contact> markus.feldhaus@t-systems.com
Lukaskrankenhaus Neuss
Digitizing the doctors.
Physicians and nurses at Lukaskrankenhaus in the German city of Neuss have
swapped paper and pens for iPad minis. A specially designed app, iMedOne
Mobile, allows hospital staff to call up laboratory test results, x-rays, and other
details, and to enter new data, such as blood pressure readings and body
temperature, directly at the patient’s bedside. They can also take and save
photos of wounds to accurately document treatment and healing processes.
In addition, doctors can leverage iMedOne, the mobile version of the hospital
information system (HIS) developed by Telekom Healthcare Solutions, to dictate reports, and send them to a typist, who transfers the finished document to
the patient’s electronic records. iMedOne Mobile also streamlines drug administration, making it safer and more reliable. If a doctor decides to alter a dose
or switch to a different medication, other hospital staff can immediately see
the change at their own workstation. Plus, there is a function for checking
interactions between pharmaceuticals. The Neuss hospital’s master plan is to
digitize as many processes as possible. And iMedOne, paired with the iPad
mini, is already playing a major role. The mobile HIS improves and accelerates
treatment documentation, approval workflows, and invoicing. It makes day-today tasks safer and simpler, leaving medical professionals with more time for
patients. All eleven departments at the 518-bed facility are scheduled to go
digital with a total of 200 iPad minis by early 2016.
<Contact> jan.ehlting@telekom-healthcare.com
Knappschaftskrankenhaus Bottrop
An app that improves
patient care.
The Knappschaftskrankenhaus in Bottrop (KK Bottrop) is a pioneer in the
field of digitization. In 2005, the hospital for vascular surgery became one of
the first to adopt iMedOne, a hospital information system (HIS) that enables
paperless processes. In addition, in 2014, the hospital collaborated with
T-Systems to develop an app for tablets: iMedOne Mobile. KK Bottrop already leverages this solution within all ten units, on 150 iPad minis. Data can
be accessed from anywhere in the hospital, and documentation is now
seamless and more reliable – information no longer needs to be manually
keyed in, and the system logs all user activities. It is also possible to integrate
external service providers, such as laboratories. The app is a genuine timesaver: approval requests, for example, can be acknowledged with point-andclick simplicity. Doctors and nursing staff are highly satisfied with iMedOne
Mobile. As Herbert Schulz, Director of IT at KK Bottrop, explains: “As the app
is user-friendly, the iPad minis enjoyed rapid acceptance among our staff.
And above all, the mobile devices have improved the quality of patient care.”
<Contact> markus.heitkamp@telekom-healthcare.com
best practices
News
— 57
doculife
Robust cloud-based document management.
Photos: Deutsche Telekom AG, Ullsteinbild-Euroluftbild.de/Hans Blossey, John Lund/Blend Images/Corbis
Tracking down key documents and vital information is a daunting challenge
for many professionals every day. Searching through maze-like storage
systems across multiple departments and divisions is time-consuming, and
sends costs soaring.
doculife, a cloud-based solution, models the entire lifecycle of an organization’s documents. All files are centrally captured, stored and managed.
Security takes top priority: the solution meets all European security, data protection and compliance standards, and is operated by T-Systems in Germany
at a high-security data center, certified to ISO/IEC 27001.
The document management system (DMS), with its intelligent, content-driven
search engine and powerful versioning function, supports the exchange of
information in-house, or with external customers and partners. Authorized
users have around-the-clock access, and can share and edit documents
via mobile devices.
“doculife boosts the efficiency and productivity of our enterprise. At the same
time, it cuts costs and has allowed us to reassign resources,” explains Mark
Nys, CEO of Water & Mind Ltd, a UK-based provider of management systems.
The fully scalable, end-to-end solution is also deployed by LED manufacturer
Telefunken Licht and debt collection agency BFF Management.
3,300 users in the sales and service unit for business customers at Telekom
Deutschland can also attest to the system’s strengths. “Enterprises benefit
from savings of millions of euros a year,” notes Christian Till Roga, Senior
Vice President of T-Systems’ Digital Division. Furthermore, doculife can be
leveraged by attorneys and notaries, who must comply with extremely stringent privacy and security standards in accordance with German legislation.
<Contact> alfred.gau@t-systems.com
The gold standard
top marks for deutsche telekom security.
According to IT consultants Experton, Deutsche Telekom is a leader in the
German managed security services market. The analysts highlighted the
company’s extremely attractive portfolio and exceptional competitive edge
in the German B2B sector.
The Security Vendor Benchmark study comprehensively examined the offerings of 450 security service providers in Germany. Deutsche Telekom performed very well in the security information and event management; mobile
security as a service; and managed security services categories. In all three,
the company garnered top scores for its portfolio and competitiveness.
It was also identified as a leader across a further four criteria: cloud
computing and data centers; backup and availability; user identity management; and IT security consulting.
Experton has predicted that spending on IT security will increase nine
percent annually between now and 2018. In Germany, the greatest market
challenge is the lack of qualified IT security professionals. Approximately
1,500 security experts are employed by Deutsche Telekom and T-Systems.
<Contact> andreas.maurer@t-systems.com
Illustration: Stephan Rürup
Cartoon
— 58
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