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CIO interview: Ismo Platan, SSAB
Retiring CIO of Swedish steel company tells Computer Weekly about the progress made in merging two Nordic steel firms and looks at the biggest hurdles that lie ahead
When Swedish-founded steel company SSAB acquired Finland’s Rautaruukki in 2014, Ismo Platan, CIO of Rautaruukki, became CIO of the combined organisation.
Platan, who is about to retire, tells Computer Weekly about life at the top of IT at a global steel company.
Based mainly in the Nordics and the US, SSAB has 16,000 employees across 50 countries. The company is highly specialised, which is a necessity because it does not have the advantage of a low-cost environment, said Platan.
Before he calls it a day, Platan will work with Jussi Juvani, who has been nominated as SSAB’s new head of IT. “I have not yet retired officially, and we do not have a fixed date for when I will,” said Platan. “I have promised to support this transition for a number of months, so that it can be done smoothly.”
Platan’s previous transformational skills were key to his appointment as CIO following the merger.
“I believe there were a few reasons for choosing to appoint me as CIO,” he said. “I helped Rautaruukki to make a big transformation, and I have also been involved in a number of big mergers during my career. All these experiences have been useful.”
IT’s most important task is to truly support SSAB’s business strategy, said Platan. “We want to be the enabler. Another important task for us is to deliver synergies. And that is not only true for IT – when two companies merge, everybody has to deliver synergies.”
As far as IT was concerned, the SSAB-Rautaruukki merger consisted of two parts, said Platan. “The first part was basic integration of infrastructure, security and so on. We handled that part extremely well. The second part is to take advantage of the huge opportunities that open up. How can we make one plus one equal three?”
Common business solutions
This second stage of the merger will last for at least two to three years because it takes time to implement big changes in business applications, said Platan. “We will build common business solutions and standardise applications, platforms, processes, and so on,” he said. “It is interesting, demanding, and requires a lot of work.”
So far, nothing particularly stands out about this merger compared with the earlier mergers Platan was involved in. “It has not been either harder or easier,” he said. “All mergers are different, but the principles are the same – and you never have a dull moment.”
According to Platan, the merger has been positive for both companies and their employees. “Everybody supported it,” he said. “There has been a lot of discussion about why we have two steel companies in the Nordics competing with each other. We all realised we could have a more prosperous future together.”
SSAB’s IT department comprised about 140 people before the merger, and Rautaruukki had about 160. “We now have 260 people in the new IT function – it is easy to understand that a merger usually means a reduction of employees,” he said. “Of the 260, just over 100 are in corporate IT, and the rest are in our five business areas.”
About 60% of the organisation’s IT is handled by suppliers, said Platan. “But outsourcing is the wrong term – right-sourcing is the correct one. The IT function is a service broker, trying to identify the best services in the market.
“In Rautaruukki, about 70% of IT services were provided by IT service partners, and in SSAB it was about 50%.”
The merger was announced at the beginning of 2014, “but then we had to wait for approval from the competition authorities, so we started to work together as a company in September 2014”, he said.
“As in all major mergers, IT is one of the first functions that has to be operational, so we were under pressure to work together before approval was given – not connecting anything, but preparing.”
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There have been no major conflicts – but there are daily conflicts of interest, said Platan. “We have different backgrounds, different degrees of maturity, and speak different languages. That is why it is so important to communicate – to really understand what the other party means.”
When people get used to their own systems and ways of operating, it is difficult to change, said Platan. “For us, it is important to take the best from both worlds. You cannot say that one of the companies has better solutions than the other – absolutely not.
“It is important to be open-minded, and able to see that one of the companies has a good solution in one area, and the other has a good solution in another area.”
Ismo Platan, SSAB
Luckily for Platan, SSAB and Rautaruukki were using the same collaboration tools. “We had pretty much exactly the same products, so that was an extremely good starting point,” he said. “We did not have to switch products, just create a common platform.”
The collaboration tools are SSAB’s most important IT systems, he added. “Ten years ago, I would have said our ERP system was the most important IT system. We of course still have big ERP systems, but today Skype, email, mobile, social media, and so on are even more important.”
The merger will continue to be the main focus over the coming years, but another important challenge will be going digital, said Platan. “Digitalisation is a trend we cannot fight. Our new web presence and new intranet are the first things we have accomplished in this area, and we are also consolidating and harmonising customer data, so we will be able to provide more services to our customers.”
The next step is to analyse which areas of the organisation’s different business divisions can benefit from digital technology, said Platan. “I do not want to give examples, because if I say publicly what we are going to do, we will lose our edge. But I can tell you we will become digitalised.”