.png)
Digital transformation is a pivotal journey for modern enterprises, especially in the highly competitive chemical industry. In the latest episode of the DigiChem Dialogues, Henrik Hahn, Chief Digital Officer of Evonik, shared valuable insights and best practices drawn from his extensive experience in leading the company's digital transformation since 2016.
Here are some key takeaways from his interview, along with insights and best practices for digital transformation that can be applied to any organization:
According to Hahn, the cornerstone of digital transformation is a mindset shift rather than a mere technological overhaul. He asserts, "Mindset drives digital value, not technology in itself." This perspective emphasizes the true power of digitalization lies in the people and the organizational culture rather than the tools and technologies employed.
Beginning the digital transformation journey with digitization is a practical and effective approach. Hahn explains that digitization is the entry point to digital transformation. "Digitalization can be regarded as the necessary upfront investment that lays the groundwork for a real transformation."
Digitalization involves converting analog information into digital formats, a crucial step for organizations to establish a solid digital infrastructure.
One of the most impactful areas to start digitizing is product data. Product data includes all information related to each chemical's technical specifications and details.
Data is the foundation of any successful digital transformation. Hahn highlights the importance of data in decision-making: "Data converted to information is enabling better decision-making and even helping to validate a course of action before committing to it." Collecting, managing, and analyzing data systematically is crucial. This involves tackling common challenges such as inconsistent master data and unstructured data stored in various formats across the organization.
A well-defined plan with measurable goals achieves meaningful outcomes. Hahn emphasizes, "Just doing digital stuff without that plan won't lead to any sustainable result." This involves setting clear objectives for each digitalization initiative and ensuring that every effort aligns with specific business needs.
Hahn recounts Evonik's journey, which began with a phase of experimentation. In 2016, Evonik set up a dedicated unit for learning and exploration. He describes digital transformation as a marathon: "Exploring and integrating the technologies in all areas of the company does indeed require stamina and staying power."
Each digitalization use case should address a specific business problem. Hahn states, "Every digitalization use case should address a specific business need." This approach ensures that digital initiatives are purposeful and directly contribute to the company's strategic objectives.
Achieving organizational alignment is crucial for the success of any digital transformation initiative. Henrik Hahn offers several best practices to ensure that all parts of the organization are aligned and moving in the same direction:
Henrik Hahn acknowledges a common challenge in organizational alignment: resistance to new ideas. He states, "Even great ideas can meet resistance. In any organization, you will find people who literally stand in the way of good ideas." This resistance stems from a variety of factors, including fear of change and discomfort with new processes.
To address this, Hahn discusses the importance of identifying the stakeholders involved. "Starting by mapping the key stakeholders who will be affected by the idea and also engaging influential skeptics, both positive and negative, could indeed help you get to this level of alignment." By identifying and involving both supporters and skeptics early on, organizations build a more comprehensive understanding of potential challenges and opportunities.
Hahn emphasizes the power of symbolism, metaphors, and compelling stories to engage stakeholders' hearts and minds. "The use of symbolism, metaphors, and compelling stories, like the metaphor with the marathon, might help to engage hearts as well as minds in order to build commitment."
Trust and openness are core values at Evonik that play a crucial role in achieving alignment. Hahn notes, "Trust is one of our core values as openness is another. You have to embrace this change and embed a digital mindset and enhance organizational intelligence." Fostering an environment of trust encourages open dialogue and collaboration, aligning diverse parts of the organization.
To operationalize use cases and avoid reinventing the wheel, Hahn advocates for the development of cross-organizational frameworks. These frameworks consist of reusable and adaptable elements that can be applied across different projects and departments. "We developed cross-organizational frameworks based on a set of reusable and adaptable elements to foster the operationalization of use cases."
Such frameworks ensure that best practices are consistently applied, breaking down silos and facilitating the flow of information. Hahn explains, "This approach helps to avoid reinventing the wheel. Reinvention can waste valuable resources and be rightfully criticized by top management."
Hahn also highlights the importance of strategic partnerships and ecosystem participation. "Partnering and being part of an ecosystem is an important way to drive forward topics in a strategic manner." By collaborating with external partners, organizations complement their internal capabilities with specialized expertise and innovative solutions.
Finally, Hahn stresses the importance of strategic management in overcoming resistance to change. "People don't want to do anything that changes their usual way of doing things because they want to avoid the pain, anguish, frustration, and lack of confidence that goes along with new stuff." Strategic management involves clear communication, training, and support to help employees adapt to new ways of working.
Digital transformation is not without its challenges. Hahn reflects on the importance of being prepared for setbacks and learning from them. For instance, despite initial success, the One2Chem platform had trouble maintaining traction, leading to its eventual discontinuation. Hahn underscores the need for continuous evaluation and adaptation: "Evaluating the results of your efforts leads to long-term success. And that's the painful exercise because sometimes the gains of digitalization just remain marginal."
By following these best practices, organizations can achieve alignment across all levels and departments, ensuring a cohesive and coordinated approach to digital transformation.
Henrik Hahn's insights provide a comprehensive roadmap for companies embarking on digital transformation. By fostering a mindset shift, prioritizing data, setting clear goals, encouraging experimentation, addressing specific business needs, leveraging ecosystems, being adaptable, and achieving organizational alignment, organizations can navigate the complexities of digitalization and unlock its full potential. As Hahn aptly puts it, "It's not about technology; it's about people."
Stay up to date with the latest video business news, strategies, and insights sent straight to your inbox!
.png)
