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Digitisation should be a transformation process that encompasses everything in a company, according to Alexandra Drevenlid, recently appointed chief digital officer (CDO) at Finnish IT software and service provider Tieto.
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When she took the top IT job at the company, the first thing she did was change her title from that of CIO to CDO.
“Digitisation is so much more than just technology and innovation, it is also business renewal from the core, and involves people, processes and the whole organisation,” she says. “It is a matter of being bold and having the courage to challenge existing processes and ways of working.”
But before shaking up Tieto’s operational models, Drevenlid’s first task is to get to know the 13,000-employee company where she started in October 2016. The CDO sits in Tieto’s Stockholm office in Sweden, and oversees an IT organisation of 100 people spread across 20 countries.
The one change Drevenlid has already brought with her is the role of a CDO itself, which is a new position at Tieto and replaces the former position of CIO. Drevenlid doesn’t see this as a recasting of the CIO role, but a reflection of its increased focus on digitisation and drive for change, for both its staff and its customers.
“I see a very clear difference between the traditional CIO role and the CDO role. The CDO role is bigger than focusing on technology to solve problems,” she says. “It is about transformation and how we can use technology in the best way to improve the customer and user experience.”
Drevenlid has 20 years of experience in IT, and worked as the chief technology and information officer at Swedish telecommunications operator Tele2 before moving to Tieto. This move from a consumer-oriented industry to business-to-business is both a challenge and a strength for Drevenlid. She believes it is an advantage for a CDO to be able to take an outsider’s view to a company and have a strong understanding of its users.
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“It is very important to understand our customers, but also to understand their customers too. That is something I look to bring to the role,” she says.
While the role of a CDO is still being shaped at Tieto, in an ideal scenario, it should combine the understanding of traditional IT and how the current IT environment has been forged with a change-oriented outlook. IT’s traditionally strong focus on cost cannot be applied the same way in digital transformation, says Drevenlid.
“Of course, you need to optimise the current cost base. All companies need to do that, but going forward with digitisation, you need to understand it will require investment in the early phases to gain benefits in the future,” says Drevenlid.
She adds that the costs of digitisation should also be considered from a different perspective. It is not all traditional IT spending, but rather costs attached to marketing, sales and business development.
One size never fits all
Tieto works with companies across many different industries, including finance, healthcare, media and the public sector, but digitisation has implications for them all. Every company and industry is different in its needs and demands, and there is no one-size-fits-all model for digital transformation. Drevenlid wants to see a more holistic approach to the whole process. It cannot be left on the shoulders of one department or unit.
“Digitisation is about more than just focusing on technology and the challenges it brings up,” says Drevenlid. “It requires renewal from the core, and taking into account the processes, the people, and the whole organisation. Digitisation is only made successful through collaboration in the whole company.”
While the buzz about digitisation is nothing new in Sweden, it is only lately that companies have started to make more conscious moves beyond its technological aspects.
“Digitisation is not a destination we can reach in just a year or two. It is a journey of constant exploration, improvement and development from various angles,” she says. “Regardless of what business you are in, you need to focus on digitisation.”
And this journey should not be made too complex. Drevenlid advocates a step-by-step approach and experimentation in all IT development instead of traditional, large-scale projects. This means ensuring there is enough flexibility to continually assess what works well and what doesn’t, as well as exploring new technologies and adjusting the projects to meet any change in the business environment and user needs.
“It is important not to create huge IT projects that take several years to deliver, because after a few years, most of the requirements, needs and demands will have changed along the way,” says Drevenlid.
Evolution through ecosystems
One way Tieto hopes to drive its own digital transformation is through an increased focus on co-innovation and building ecosystems. A recent example of this is the Data-Driven Businesses unit the company opened in July 2016.
The unit invites external partners, teams and startups from different industries to develop new data-based services and business models, together with Tieto’s employees and coaches. While the collaboration model is not new, Tieto’s unit has a strict focus on data, and it also includes an incubator which helps commercialise ideas and test if there is a viable business case behind them.
Another example is the HSB Living Lab, a living laboratory experiment in Gothenburg, which covers 29 apartments for students and guest researchers of which Tieto is a partner. The 10-year project has so far worked with 15 partners to test and develop new smart technologies for housing.
While these initiatives are not directly under Drevenlid’s leadership, Tieto’s IT works closely with both projects. In fact, she believes these kinds of partnership ecosystems will be the future of digital innovation.
“IT plays an important and crucial role in these growing ecosystems with an in-depth knowledge of, for example, cloud computing and IoT [internet of things],” says Drevenlid. “Co-creation by sharing data and developing new solutions and services will be even more important going forward. This is quite simply the new way to drive innovation.”