What is digital transformation?

Digital transformation within the emobility market Learnings and insights from early market development

Dipl.-Kfm. Andreas Pfeiffer – [email protected] Prof. Matthias Jarke – [email protected] Chair of Computer Science 5 – Ahornstr. 55 – 52074 Aachen

Digital transformation

What are digital artifacts? What is digital technology? What is digital transformation? How are they influencing business model development?

© Andreas Pfeiffer 2016

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Digital artifacts Definition • continuants combined with structure • agentive function imposed by human communities • nonphysical mode • they may distinct from nonmaterial and material “bearers” Characteristics • editability • interactivity • programmability/ openness • distributiveness The first attributes concern the operations by which digital objects are put together (editability, interactivity, programmability) and the last the ecology of relations within which these operations are embedded (openness, distributiveness). © Andreas Pfeiffer 2016

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Digital artifacts     

Active and interactive Interoperability Networked, responsive and loosely bundled Borderless, fluid and crucial transfigurable Multimedia (text, vocal, video)


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Digital technology – Digitization of objects Digitization Technical process of embedding nonmaterial technological objects into material technological objects.

Definition Digital technology • the assemblages of digital and physical technological artifacts that are recognized as an end product to meet customer needs • organized arrangement of nonmaterial and material technological objects consisting of computing, communication, interaction and information technologies Characteristics • incorporation of digital objects causes physical objects to adopt the characteristics of digital artifacts • digitized objects are characterized by distinct trajectories of material and digital artifacts © Andreas Pfeiffer 2016

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Digital technology – Operand and Operant Digital technology plays a dual role operand  enables the creation of new value networks and facilitates the exchange of resources and knowledge within the network. operant  as initiator it is becoming increasingly part of new offerings. Digitization of products enables value creation through additional services having a combinatorial effect on the digital service ecosystems (product-service-systems).


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Digital technology – Layered Modular Architecture Characeristics of Layered Modular Architecture • separation of material and nonmaterial entities • maintaining an interoperability among the components • by a hierarchical dependence between the layers • free and individual designs in-between the different layer levels

Digital technology is delivered intentionally incomplete with temporary bindings across the four layers following the procrastination principle. © Andreas Pfeiffer 2016

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Digitization's impact on business Digitization enables unprecedented opportunities of generativity!

Generativity is  capacity of technology to produce unprompted change driven by large, varied and uncoordinated audiences  abundant opportunities for innovating products, services and business models  product and service boundaries become fluid.


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Emobility market – objects, roles & objectives Objectives Sustainability – ecological, economical and social      

automotive CO2 Emission Reduction Remove cars from streets Make money Ease life Take changing mobility habits into account Take changing energy production into account

What is the role of …  digital technology  business models?? © Andreas Pfeiffer 2016

technology

digital ecosystem

energy

logistics

society

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Market overview – public charging

Rodríguez, R., Madina, C., & Zabala, E. (2015). EV Integration in Smart Grids Through Interoperability Solutions.


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Example: Digitization of charging infrastructure


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Digitization from manager's perspective Generativity causes a magnitude of possibilities and a perfect starting point for an evolving business whereby the management of business models gets highly complex:  premium on drift rather than stability and control,  change and flexibility management rather than accountability,  valorizing expression rather than restraint!


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Digital Transformation of Business Models Digital Technology Digital Technology Digital Technology

Value

creation, capturing delivery enables

Business Model

defines Business Strategy


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What is digital transformation Fitzgerald et al. 2013 “digital transformation is the use of new digital technologies (social media, mobile, analytics or embedded devices) to enable major business improvements (such as enhancing customer experience, streamlining operations or creating new business models)” Tilson et al. 2010 “a sociotechnical process of applying digitized technology to broader social and institutional contexts that render digital technologies infrastructural”

Yoo et al. 2010 “transformation of socio-technical structures that were previously mediated by nondigital artifacts or relationships into ones that are mediated by digitized artifacts and relationships. Digitalization goes beyond a mere technical process of encoding diverse types of analog information in digital format (i.e., “digitization”) and involves organizing new socio-technical structures with digitized artifacts as well as the changes in artifacts themselves.”


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Impact of digital transformation Digitalization is influencing (in part disruptively) • processes, • organizational forms, • relationships, • user’s product or service experience, • markets coverage, • customers. Significant change in nature and focus of the • business activities, • need to acquire new capabilities or markets, • and fundamental changes in tasks


Changes Business Strategy in  source of value creation  scale  scope  speed

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Digitale Transformation – Emobility Service Provider business model charge point technology

simple

simple+

medium

Type 1 www

Type 2 www

Type 3 www, CPMngmt

+ +++ + + + -

+ + +++ + + + -

+ + +++ + + + + + + + + + + + +

++ ++ +++ ++ ++ + + + ++ + + ++ + + + + + + ++

flat, usage-

flat, usage-

ict application charging

physical service

charging type 2 & CCS EVSE deployment maintenance customer handling

ICT related basic services

digital authorization webservice interaction digital guided maintenance reservation market place connectivity realtime info (CP/ charging) payment model flexiblity legal informational require.

ICT related comfort services

value creation

geo-information

remote control dynamic pricing smart grid integration demand side mngmt V2G seemless customer handling

e

© Andreas Pfeiffer 2016 revenue model

flat

flat

high

high+

Type 4 Type 5 www, EVSE www, EVSE mngmt, mngmt, intraconnected, interconnected, dsm dsm

+++ +++ +++ +++ +++ +++ +++ +++ +++ ++ + + +++ +++ +++ +++ +++ +++ +++ +++ flat, usagebased, direct,

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p

maintenance customer handling geo-information

+ + + simple - 1 Type www -

+ + + simple+ - 2 Type www -


webservice interaction

digital guided maintenance

reservation

market place connectivity

realtime info (CP/ charging) payment model flexiblity


value creation

Digitale Transformation – Emobility Service Provider digital authorization

legal informational require. remotemodel control business pricing charge pointdynamic technology smart grid integration demand side mngmt

ict application V2G

seemless customer handling

service


value capture physical

charging revenue charging type 2model & CCS

EVSE deployment

revenue model flexibility

maintenance

business scaleability

customer handling

business scopeability capex (EVSEgeo-information / location / ICT)

digital/ location/ authorization opex (EVSE ICT)

+

+

flat -

flat +

+++

low + low + close + -/-/+/+/-

reservation

market place connectivity realtime info (CP/ charging) payment model flexiblity


value creation

webservice interaction + fulfillment inflexibility ++ 3rd party nodigital directguided interaction maintenance +++ direct handling 3rd party


legal informational require. remote control dynamic pricing smart grid integration demand side mngmt V2G

-

+++

low + low + close + +/-/+/+/-

+ + + + + + + + + + medium - 3 Type www, CPMngmt + +

++ +++ ++ +++ + +++ + +++ + +++ ++ +++ + ++ + + + ++ +++ + +++ + +++ high high+ + 4 +++5 Type Type + +++ www, EVSE www, EVSE + +++ mngmt, mngmt, + +++ intraconnected, interconnected, dsm dsm ++ +++ flat, usage+ ++ +++ flat, usage- flat, usagebased, direct, + ++ +++ based based 3rd-party +++ +++ +++ medium high high + ++ +++ low medium high + ++ +++ medium medium high + + +++ +/-/+ +/-/+ +/-/++ + + +++ +/+/+ -/-/+ -/-/+

of business model + + + + + + +

+ +++ ++ +++ integrativity + of customers ++ needs fulfillment + + + ++ +++ + +++ + +++ + +++ + +++ + +++ + +++

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Conclusion 1/2 • generic classification of digital artifact integration in EVSE provides possibilities for EMSP to develop business models • EMSP value creation, capturing and business model sustainability are highly reliant on the grade of digitalization  utilize digital technology’s ‘layered modular architecture’ (LMA) for identification of digital technology enhanced business services  LMA and Service-oriented Architecture (SOA)-concept are proposed to enhance business model generation in digital transformed ecosystems


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Conclusion 2/2 • digitization versus digitalization • digital manager versus digital entrepreneur  generativity is significantly stronger through implementation of open, accessible, interoperable and interconnected technology following ‘layered modular architecture’ – particular in early development stages  affordance for managing high complexity due to different trajectory paths of digital and physical technologies in the field  Result: generative nature of digitality can be leveraged and transferred into business models carrying digital artifacts into reality


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outlook

SERVICE-ORIENTED BUSINESS MODELLING


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Evolution cycle


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Service-oriented Business Modeling (SOBM)


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Thank you very much for your kind attention!

[email protected]


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