Digital Transformation , livre ebook

Digital Transformation

Digital Transformation
Understanding Business Goals, Risks, Processes, and Decisions
Mathias Cöster, Mats Danielson, Love Ekenberg, Cecilia Gullberg, Gard Titlestad, Alf Westelius, and Gunnar Wettergren





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© 2023 Mathias Cöster, Mats Danielson, Love Ekenberg, Cecilia Gullberg, Gard Titlestad, Alf Westelius, and Gunnar Wettergren




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Mathias Cöster, Mats Danielson, Love Ekenberg, Cecilia Gullberg, Gard Titlestad, Alf Westelius, and Gunnar Wettergren, Digital Transformation: Understanding Business Goals, Risks, Processes, and Decisions . Cambridge, UK: Open Book Publishers, 2023, https://doi.org/10.11647/OBP.0350
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ISBN Paperback: 978-1-80511-060-6
ISBN Hardback: 978-1-80511-061-3
ISBN Digital (PDF): 978-1-80511-062-0
ISBN Digital ebook (EPUB): 978-1-80511-063-7
ISBN XML: 978-1-80511-065-1
ISBN HTML: 978-1-80511-066-8
DOI: 10.11647/OBP.0350
Cover photo by Love Ekenberg
Cover design by Jeevanjot Kaur Nagpal

This book is dedicated to our dear friend, esteemed colleague, and co-author Professor Love Ekenberg, who passed away in September 2022 during the writing of this book. We mourn his untimely death, and that he is not here with us to see the end result.


Contents
Prefacexiv
1. Introduction1
1.1. Roles of Digitisation in Operations5
1.2. IT’s Informing Function8
1.3. Information and Value13
1.4. Type of Business Determines IT Needs17
1.5. Digital Transformation and Fundamental Rethinking19
1.6. Significance of Systematic Decision-making21
1.7. A Global Perspective22
1.8. The Structure of the Book23
2. Organisational Goals, Strategies, and Digitisation25
2.1. Organisational Goals25
2.1.1. Goals, Time Perspectives, and Goal Conflicts26
2.1.2. Organisational versus Personal Goals31
2.1.3. Financial Goals32
2.1.4. Non-financial Goals33
2.1.5. To Balance Different Goals34
2.2. Organisational Strategies36
2.2.1. Challenges in Strategy Work36
2.2.2. An example of strategy formulation37
2.2.3. Strategy Approaches39
2.2.4. Coordinating Strategies at Different Organisational Levels 41
2.2.5. Strategic Dialogues44
2.3. Chapter Summary 45
2.4. Reading Tips 46
3. Business Models and Digitisation49
3.1 The Relationship between Strategy and Business Model Concepts49
3.2. The Different Parts of a Business Model51
3.3. Business Model Digitisation52
3.3.1. Value Proposition53
3.3.2. Partners, Subcontractors, Activities, and Resources55
3.3.3. Customers, Customer Relations, and Customer Channels57
3.3.4. Revenues and Costs59
3.4. Digital Business Models61
3.4.1. The Roots of Digital Innovations62
3.4.2. Digital Intermediaries and Network Builders63
3.4.3. Some Common Denominators for Digital Business Models70
3.5. Chapter Summary71
3.6. Reading Tips73
4. The Organisation of Digitisation77
4.1. Background: A Few Questions surrounding Digitisation79
4.2. Who Works with Digitisation?82
4.2.1. Who Decides? 83
4.2.2. Combining Perspectives from IT and Operations85
4.3. What Does Working with Digitisation Entail?90
4.4. Social Aspects of Coordinating IT Specialists and Operations94
4.5. Outsourcing and Partnership with Suppliers100
4.5.1. What Does the Outsourcing of IT Entail?100
4.5.2. Reasons for Outsourcing105
4.5.3. Reasons against Outsourcing110
4.6. Management of Outsourcing114
4.6.1. Procurement Competence114
4.6.2. Continuous Monitoring and Management115
4.7. Chapter Summary119
4.8. Reading Tips120
5. Structured Decisions and Decision Processes125
5.1. Rough Analysis and Improvement Potential127
5.2. The Decision Process129
5.2.1. Identification and Structuring130
5.2.2. Information Capture and Modelling130
5.2.3. Evaluation133
5.2.4. Refinement of the Decision Basis135
5.3. Extensions of the Analysis137
5.4. Chapter Summary138
6. Procurement Competence139
6.1. The Complexity of Procurement Processes140
6.2. Evaluations of Tenders141
6.3. Evaluation Criteria144
6.4. Unreasonable Precision146
6.5. Shortcomings of Handling Value Scales148
6.6. Weights and Value Scales150
6.7. Rankings155
6.8. Right and Wrong in a Procurement Process159
6.9. Chapter Summary159
7. Probability and Risk Management161
7.1. Probabilities and Decisions161
7.2. Tree Models166
7.3. Realism in Decision Models 168
7.4. Sensitivity Analyses175
7.5. Tool Support179
7.6. Chapter Summary180
7.7. Reading Tips181
8. Project Portfolios185
8.1. The Project Portfolio and the Organisation186
8.2. Are We Investing in the Right Things?187
8.2.1. Quantitative Models189
8.2.2. Qualitative Models197
8.2.3. Balancing the Portfolio199
8.2.4. Strategic Alignment and Agility205
8.3. Are We Using Our Capacity Correctly?207
8.4. How Well Are Projects Implemented?208
8.4.1. Follow-up during Project Execution209
8.4.2. Follow-up after Project Completion210
8.5. Chapter Summary210
8.6. Reading Tips211
9. Managing Projects213
9.1. Goals and Definitions213
9.2. Project Models214
9.2.1. Sequential Project Models214
9.2.2. Problems with the Waterfall Model217
9.2.3. Iterative Methods: Focus on Utility218
9.2.4. Problems with Agile Methods223
9.2.5. Which Method to Use and When226
9.3. Common Skills, Tools, and Methods227
9.3.1. Conducting a Feasibility Study227
9.3.2. Working with and Managing Requirements229
9.3.3. Time Estimates230
9.3.4. Risk Analyses233
9.4. Chapter Summary245
9.5. Reading Tips246
10. Globally Sustainable Digital Transformation247
10.1. Digitisation in the Higher Education Sector250
10.2. Need for a Higher Education Process Framework250
10.3. Aligning Higher Education Frameworks with SDGs253
10.4. Chapter Summary255
10.5. Reading Tips256
11. What Is This All About?261
11.1. The Ecology Perspective and a Strategic Grip on Digitisation261
11.2. The Business Focus267
11.3. Strategy, Goal, and Business Model269
11.4. Organising Competences and Resources270
11.5. Decision-making and Risk272
11.6. Project Portfolio and Implementation275
11.7. Sustainable Development277
11.8. Digital Transformation and Value277
Appendix279
List of Illustrations293
Index297
About the Authors301

Preface
The world is more unpredictable than ever. Digital transformation, which in principle affects everything that surrounds us, has during the last half-century strongly contributed to this unpredictability. It has enabled a global trade that incorporates more and more people, organisations and states. It has enabled a larger international labour market than anyone could foresee. It has made possible a tremendous rationalisation of social functions and tasks. It has enabled a huge flow of information in all sectors of society. And it has enabled some sort of organisation of all of the above. Numerous human beings, for better and for worse, have had to dramatically change their lives. The ongoing digital transformation has thus created a wave of both problems and opportunities. This development has fantastic advantages, but there is every reason to consider it with some scepticism. Nevertheless, this is where we are, so let us shape the future so that it suits us.
Digital transformation is ubiquitous. Everywhere we look these days, at least in cityscapes, we can see or otherwise sense signs of this ongoing societal transformation. Old ways of organising the transfer of goods or services from sellers to buyers constantly have to give way to new ones. There are even multiple waves of transformation. Consider, for example, the video and computer game industry, which used to sell products on DVDs (and earlier on other physical digital media). Those were predominantly sold in brick-and-mortar shops such as game stores, toy stores, and department stores. In the first wave of transformation, online sales of DVDs gradually but largely rendered game stores obsolete. In the next wave (