Digitalization is on the advance and with it the transformation has a boom. The horror stories of disruptive business models are giving entrepreneurs sleepless nights. Be it out of fear of (new) competitors or as dream scenarios in which one is the disruptor oneself.
It is often forgotten that transformation is not a new phenomenon and certainly not always has anything to do with digitalisation. If you want to generate continuous corporate success, you have to constantly question your business model and adjust or follow completely new avenues. Only then a company can be permanently different and better than its competitors. That means shining both in conceptual and implementation strength.
Transformation simply means the change from an existing actual state to a new target state. Thischange does not happen coincidently, but is a strategic change.
Well-known examples of international players such as Kodak or Nokia tragically show what missing transformation can cause. With the loss of their conceptual strength, the once shining stars in the corporate sky have now disappeared from the picture.
The wheel of business model reinvention
Voelpel/Leibold/Tekie speak of the “wheel of business model reinvention”. The conditions of the market environment are dynamic. Thus, business model cannot be stiff, uniquely considered concepts, but are subject to change. Voelpel/Leibold/Tekie see four dimensions that are subject to the wheel of reinvention – customers, technology, business system infrastructure and economic factors. The four dimensions caninfluence each other.[1]
Times are changing. What used to be the decisive reason for customers to buy is already standard today. A mobile phone or smartphone that can be used to take photos aswell as make phone calls is no longer a unique selling proposition and can only elicit a tired yawn from your customer. What you used to sell at premium prices, you now only able to sell at rock-bottom prices and with discount campaigns.
From the horse to autonomous driving
The example of passenger transport clearly illustrates the transformation in an industry over several centuries. For thousands of years, we humans have been using horses to get from A to B faster.
With the invention of the carriage in the 15th century, it was not only possible to comfortably cover distances, but also to transport several people including their luggage in a single carriage with only one horse.
The evolution of passenger transport did not stop and so the first automobile was invented in 1886. The “Benz Patent Motor Car Number 1” had a combustion engine and gained the public’s attention. Admittedly, there were further development stages in between with steam cars and co, which would go beyond the scope of this article.
Today, our cars are true masterpieces of design engineering and mechatronics. Sensors are creeping into new cars, providing us with conveniences such as parking assistants and continuously driving in the direction of autonomous driving.
Vehicles equipped with a wide variety of sensors close the loop to the past. Intelligent, autonomous vehicles had already been on our roads in the past. After all, million of years ago, the horses simply stopped completely independently in front of an abyss or a wall.
Transformation for over 150 years
Bernhardt’s Söhne GmbH is a company that has been demonstrating its ability to transform forover 150 years. It all started with mechanical water meters. The biggest disadvantage for the infrastructure provider is the manual reading of the count on site.
Bernhardt took advantage of the technology and developed electronic water meters. The next logical step was to bring these meters into the Internet. Using LoRa this was realized. Every 15 minutes the values of the consumption are now recorded and transmitted.
In former times it was sufficient to read the value once a year. Why do we now need 96 values on a single day? In Europe there is about 20% water loss in the networks. The data obtained now bring real added value and help, for example, to diagnose wasted water.
“You can’t avoid one hundred percent of damage, but you can detect most of it in time. Creeping water losses are relevant for landlords of rental apartments. For example, if tenants do not report faulty WC flushing. There is an enormous saving potential,” explains Peter Mittner, managing director Bernhardt’s Söhne GmbH.
This prime example of transformation did not go unnoticed internationally either. Bernhardt’s Söhne GmbH won the IOT/WT Innovation World Cup 2018 in the Industrial category with its system that displays water consumption and triggers alarms.
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[1] Voelpel, Seven C/Leibodl, Marius/Tkie, Eden B.: The Wheel of Business Model Reinvention: How to Reshape Business Models to Leapfrog Competitors; in Journal of Charge Management 4(3),2004, pp. 259-276.
