Digital services are becoming a necessity for the economic success of every company

What sounds simple is difficult, as consumer loyalty decreases with increasing interchangeability. Consumers want a large selection, immediate delivery and the best possible service and, incidentally, a positive shopping experience. Anyone who now thinks they are in the right place in the agency environment and passes the topic on to their marketing department forgets that a shadow IT has emerged in the agency environment in recent years that is far from fulfilling the requirements of a digital strategy. However, the integration of in-house systems and core processes to round off the offerings is absolutely essential.

Low investment and low process costs

The investment required for new access to customers is relatively low. The costs for its implementation are generally even negligible, as digital services scale almost automatically and at almost no additional cost. Once the service is up and running, it can be implemented millions of times without incurring any additional costs. It therefore has a direct impact on the economic success of a company. Low investment and low process costs - this correlation means that no company is safe from digital services in its sector. In the past, there was a certain degree of economic security. This is no longer the case today; instead, security comes from speed.

For a small company, such as a start-up, even gaining a small market share can be extremely lucrative. The big players in the market often do not have much to counter these challenges due to their own high marginal costs. One response can only be to adapt and change products and services - and to do so quickly. With digitally enhanced services, product cycles are much shorter, so change and innovation must become a continuous process so that the company can react more quickly to market changes. There are plenty of examples of this.

In short: low process costs and high speed are the decisive combination for the economic success of a company today. A key element of this is the development of digital services that are based on information technology. This is changing the significance of IT, which is now becoming a strategic factor within the company. It must be measured more by its potential added value and see itself as a ‘digital enabler’. In order to fulfil this role, the IT organisation of every company must meet three important requirements:

The new role of IT as a strategic digitalisation partner

Firstly, it must move away from the purely administrative position it has assumed in recent years and decades. It is no longer enough to provide cost-optimised and efficient IT services. What is needed are innovative solutions for digital business models. IT must therefore transform itself from a cost centre into a strategic digitalisation partner, regain its willingness to innovate and consistently focus on constant change. Secondly, the IT organisation must consistently incorporate the service concept into its architecture. A new technological basis is required for the provision of digital value-added services for existing products or the development of new digital business models. This also means abandoning traditional delivery models, as numerous infrastructure providers in the public cloud already offer the right services for digital transformation - such as IoT platforms or modules for machine learning in the public cloud.

Conclusion: process costs and speed are decisive

The well-known Silicon Valley motto ‘Try fast, fail fast, adjust even faster’ should be seen as an opportunity to gain knowledge as early as possible. It is important to get feedback from users quickly during development in order to improve the product or service. This is easier said than done. This is where SMEs in particular have difficulties with the theory and practice of agile methods. They are often misunderstood and misinterpreted as a pure playground. However, the sole aim is to provide business partners, customers or users with solutions at an early stage in order to receive early feedback and be able to react without delay. After all, a company will only survive in the future if it expands its product portfolio to include digital products and services. As a result, IT is gaining in strategic importance, as it must provide the basis for digital business models.