2015-04 Digital Executive Community Proceedings

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OUTL
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Digital Executive Community 24th & 27th April 2015
Index
Introduction ....................................................................................................................................................... 2
Meeting Minutes ............................................................................................................................................... 3
Executive Summary ......................................................................................................................................... 13
Innovation Trends Presentation and Introduction to the Topic.................................................................. 13
Keynote Speech ............................................................................................................................................... 16
Digital Trends Outlook 2016: IT Roles & Evolution ..................................................................................... 16
Selected Contributions ................................................................................................................................ 32
Introduction
The Document: The BTO Proceedings is an output created and distributed in order to divulgate
the researchs results, presented and discussed during the Digital Executive Community events. The
document is display in a suitable format that makes the consultation of contents agile and rapid
and it consists of four main areas:
(1) Meeting Minutes a brief of the day, containing the main parts of the discussion and the
relevant ideas emerged from the meeting;
(2) Executive Summary the introduction to the topic, with a small summary of the proceedings,
made by BTO Researchers;
(3) Keynote Speech an overview of the two Conferences held by Professor Tobias Kretschmer;
(4) Selected Contributions a BTO re-elaboration of the Scientific Research on the topic discussed.
Purposes and goals: BTO Proceedings offer an overview of the contents discussed during the BTO
Digital Executive Community, highlighting the most important aspects and underlining the starting
point of the research.
Abstract: During the BTO Digital Executive Community, the topic focused on some of the most
considerable IT-based sources of competitive advantage for companies in many industries. In
particular, a relevant topic was discussed:
Digital Trends: Outlook 2016 IT Roles & Evolution The need to identify Global Digital Trends is
strategic to improve the business agility for future competitive challenges, enabling growth and
innovation. In particular, the role of the IT is becoming even more important in comparison with the
past and is becoming a pivotal key leveraging Business Issues and creating opportunities for other
CxO. IT-as-a-service (ITaaS) is a high priority for CIOs as they look to shake off the traditional view of
their departments as costly and inefficient parts of their businesses.
The meeting has taken place in two different sessions (Rome, April 24th and Milan, April 27th) with the
scientific contribution of Prof. Tobias Kretschmer, Professor of Management and Head of the
Institute for Strategy, Technology and Organization at Munich School of Management, LudwigMaximilians-Universitt Mnchen.
Meeting Minutes
Subject
DIGITAL TRENDS: OUTLOOK 2016

IT Roles & Evolution
FIRST SESSION
ROME
Date
24/04/2015
Place
Hotel Quirinale Rome
Start
10.00
End
13.00
Hosts
Tobias Kretschmer (Ludwig-MaximiliansUniversitt)
Florenzo Marra (BTO)
Andrada Comanac (BTO)
Tommaso Cenci (BTO)
Luca Parravicini (BTO)
Massimo Bellini (BTO)
Fabrizio Conte (BTO)
Francesca Oberti (BTO)
Francesca Donelli (BTO)
Guests
Vincenzo Pensa (ACI)
Alessandro Banci (ACI)
Mauro Abbattista (Autostrade per lItalia)
Marco Pavonio (Dexia Crediop)
Massimo Morgagni (Dexia Crediop)
Nicola Reina (Enel)
Giovanni Pepicelli (Enel)
Ettore Di Lena (Enel)
Matilde Tizio (Enel)
Sandro Tucci (Eurovita Assicurazioni)
Marco Iacomussi (Finmeccanica)
Andrea Lalli (GTECH)
Stefano Nocentini (Poste Italiane)
Rosanna Lisco (Poste Italiane)
Alberto Alberini (Poste Vita)
Maurizio Irlando (Telecom Italia IT)
Gabriele Sirovich (Trenitalia)
Fabrizio Casali (Unilever)
Introduction and Meeting Opening
The meeting has been opened with the introductive speech of Andrada Comanac, Research
Manager at BTO Research, who showed the Digital Executive Communitys evolution, the
internalization of the project and the program for 2015. She explained the agenda of the day and
introduced the research topics, in order to give a brief overview of the day.
Digital Trends: Overview

Tommaso Cenci, Research Manager at BTO Research, talked about the digital trends and the
market dynamics evolution for Digital Companies. In particular, Mr. Cenci illustrated the
importance of focusing on the business change management, considering the processes and
services evolution, and the adoption of new technologies, new organizational culture and ICT
structure. Then BTO Collection, within academic articles selected by the research team was
shown. The BTO Collections articles describe the technological trends evolution, the complexity
reduction, and digital services approach and even explain how technological capabilities
development could have a positive impact on organizational performance.
IT Roles & Evolution: Keynote Speech
The whole speech of Prof. Tobias Kretschmer, Professor of Management at Ludwig-MaximiliansUniversitt Mnchen, underlined the main topics to consider for comprehending digital trends.
During the keynote speech, the Professor explained the new nature of the IT-as-a-Service and
gave tips and food for thought thanks to his academic experience in IT Management and
Strategy, and thanks to the inputs given by attendees during the meeting.
Initially, Prof. Tobias Kretschmer showed technologies, IT environment and market dynamics
evolution happened during last years, explaining the main business opportunities related to the
application of an effective technology management. He explained, in particular, how the
intelligent network has an impact on organizations, business opportunities, potential partnership
and interaction among different industries.
Later, Prof. Kretschmer talked about the importance of ambidexterity and of using market data
and information in order to obtain competitive advantage. Data can lead to a successful change
and they can define the future of Digitization, he said.
At a later stage, the meeting focused on the right environments importance for changing. Digital
technologies are driving market dynamics and companies business models, helping new agile
players to compete in the market. Different market dynamics cannot be faced just adopting new
technologies in managing old activities, but the real challenge is to balance traditional business
practices with the new opportunities offered by technology.
Prof. Kretschmer proposed a focus on the cost reduction issue, thanks to the possible use of
digital technologies. Although Digitization fastness and convenience are different in each
industry, competitive advantage cannot be given by hardware, but through a differentiation
oriented service.
The theory of Prof. Kretschmer was confirmed thanks to many case studies used to explain how
today, in an organization, not only a Vertical Fit, but also an Horizontal Fit can lead to a
competitive advantage. In these terms, the coherence between business model, organizational
structure and IT is so much important and it could be reached even with information sharing in
business units and lines.
A particular attention was given to the difference between Exploration and Exploitation,
considering implications of both the approaches, like the necessity of more or less decisioncontrol.
In the closing, Prof. Kretschmer highlighted the role of Digitization as the key to allow a major
knowledge about customers, enabling the creation of innovative services based on data, granting
more and more customization and added value thanks to the IT lever.
Discussion Details
The participation allowed a debate about managerial items, considering different points of view
and thanks to the presence of many industries exponents.
Maurizio Irlando, Digital Channels Transformation & Customer Experience Manager and
Head of Software Architectures at Telecom Italia Information Technology Mr. Irlando
said that among the investments priorities to be considered by Telecom Italia in this
period, there are such important activities in Customer Big Data, Customer Experience
and IT in general. He confirmed also that this kind of innovations require an
organizational and knowledge change. Mr. Irlando underlined the importance of Big Data
in the Operation Management making easier trouble shooting processes. In conclusion,
he announced that the company is introducing the use of cloud technology in all
corporate departments (Marketing and Finance, above all) and this change may have
impacts in terms of organizational procedures and processes.
Stefano Nocentini, Services Integration at Poste Italiane Mr. Nocentini focused on the
difference between business and internal digital trends. He pointed out four industries
more and more affected from the digitalization: insurance banks, commercial banks,
transports and public administrations. After that, he spoke about digital trends in Poste
Italiane. First of all, the company is investing in the usage of cloud technology in order to
optimize the existing IT processes. Additionally, Poste Italiane is providing his post-men
with electronic devices to improve delivery efficiency. In conclusion, the company is
going to simplify the processes to guarantee a better service experience for the
customers, making the use of distribution channels even less complex.
Giovanni Pepicelli, Global ICT and Innovation Program Manager at Enel As Innovation
Manager, Mr. Pepicelli confirmed the importance of innovation in IT and technology in
business. He invited other participants not to consider technology as the most important
thing, because it should be seen just as a basis point: the real important thing is the
transformation of an idea that is obtained by the technology to the best solution. In the
past years, Enel made investments in social cloud, analytics and mobile but today they
are focusing on emerging trends such as Home Services and Smart Cities. He concluded
his intervention saying that the company is going to invest in Virtual Reality with a low
cost technology.
Andrea Lalli, HR Systems Italy Manager at Gtech Mr. Lalli said that the item of IT Roles
and Evolution is important for Gtech, as the company is facing a structural change. In
merging all IT environments as a unique corporate, data center consolidation and
software development optimization capabilities will play a broader role. A very
interesting point, in his opinion, is how the remote work will change. Keeping in contact
with the US market, for instance, he noticed that software development opportunities
are different and fragmented and it is not easy to integrate external contributes with
internal ones.
Sandro Tucci, Chief Operating Officer at Eurovita Assicurazioni Mr. Tucci highlighted
that digital trends impacting life insurance market in two ways. The first aspect that has
to be considered is the change of consumer habits; customers are supposed to interact
with the company in a digital manner and these needs are often opposed to regulatory
requirements. Another aspect involves the B2B market. In managing relations with other
banks, Eurovita Assicurazioni is working on electronics communication and electronic
signature of contracts. Finally, the need of digital operations in this industry seems to be
ambidextrous and crucial across channels.
Nicola Reina, BRM Innovation at Enel As conclusive speech, Mr. Reina highlighted the
concept of exploit and explore the innovation, in order to find the right solution for the
customers needs.
Final Remarks and Key Findings
The presentation of Prof. Kretschmer and the following discussion with the participants, allows
us to understand some take-home points from the meeting.
Primarily, the event underlined the importance of learning by failing and the relevance of doing
pilot projects in order to manage the failing and to enable the business to control the change.
Moreover, the meeting underlined the fact that there is a new knowledge about the customers
from which a lot of data driven opportunities could be caught.
In order to do that, creating a fit between organizational structure and IT is crucial.
SECOND SESSION
MILAN
Date
27/04/2015
Start
Place
Spazio Visconti by BTO Milan
14.00
End
17.00
Hosts
Tobias Kretschmer (Ludwig-MaximiliansUniversitt)
Vincenzo Morabito (BTO)
Florenzo Marra (BTO)
Giovanni Roberto (BTO)
Andrada Comanac (BTO)
Tommaso Cenci (BTO)
Alessandro De Pace (BTO)
Francesco Magro (BTO)
Massimo Bellini (BTO)
Luca Parravicini (BTO)
Martino Scanziani (BTO)
Giulia Galimberti (BTO)
Fabrizio Manzo (BTO)
Fabrizio Conte (BTO)
Arianna Zago (BTO)
Miguel Miranda (BTO)
Adrien Chatillon (BTO)
Valeria Lorenzi (BTO)
Francesca Donelli (BTO)
Francesca Oberti (BTO)
Roberta Rossi (BTO)
Marianna Corsello (BTO)
Guests
Maurizio Albari (AlmaViva)
Marco Tempra (Banca Popolare di Sondrio)
Simone Macelloni (Cardif Assicurazioni)
Simone Lovati (Cerved Group)
Marco Ternelli (Credem Credito Emiliano)
Paolo Calvi (Credem Credito Emiliano)
Luciano Bartoli (Credemtel)
Enrico Baldisserri (Credemtel)
Cristina Porzio (Deutsche Bank)
Christian Altomare (Deutsche Bank)
Davide Carteri (Deutsche Bank)
Gianluca Giovannetti (Gruppo Amadori)
Francesco Frau (H3G)
Fabrizio Brasca (H3G)
Susanna Nardi (Intesa SanPaolo)
Marco Valioni (ICBPI)
Maurizio Romanese (Labelux)
Ruggero Platolino (Luxottica Group)
Luciano Guglielmi (Mondadori)

Paola Benatti (Pernod Ricard Italia)
Domenico Solano (Philips Italia)
Ugo Salvi (Saipem)
Alberta Gammicchia (Seat PG)
Paolo Spelta (UBI Banca)
Livio Barbu Bogdan (UniCredit)
Mauro Frassetto (Veneto Banca)
Reinhold Grassl (Volkswagen Group Italia)
Gianluigi Farinetti (Oerlikon Graziano)

Alberto Vaghi (Pernod Ricard Italia)
Pierluca Riminucci (Prada)
Giovanni Ferretti (Seat PG)
Eric Boson (Sial)
Graziano Tosi (UniCredit)
Marco Zaccanti (Unipol SAI Assicurazioni)
Marcello Viti (Vodafone)
Introduction and Meeting Opening
The meeting has been opened with the intervention of Prof. Vincenzo Morabito, Associate
Professor at Luigi Bocconi University in Milan, and Scientific Coordinator of BTO Research.
Professor Morabito introduced the day with a brief talk, explaining with gratitude how today BTO
Research is among the most relevant realities that provide and organize executive meetings for
IT managers in the European context. He reminded the participant that the aim of this type of
events is to give participants the best content and knowledge from the Academia, and to receive
a feedback from the best professionals on the market, in order to give important starting points
for the execution of the innovation.
Digital Trends: Overview
Andrada Comanac, Research Manager at BTO Research, introduces the main topics of the
Community events, with particular focus on the Digital Executive Communitys evolution, the
internalization of the project and the agenda for 2015. She explained the program of the day and
introduced the research topics.
Tommaso Cenci, Research Consultant at BTO Research, explained the digital trends and the
market dynamics evolution for Digital Companies. In particular, Dr. Cenci illustrated the
importance of focusing on the business change management, considering the processes and
services evolution, and the adoption of new technologies, new organizational culture and ICT
structure. After that, he showed the academic articles selected by the research team and
illustrated within the BTO Collection. The BTO Collections articles describe the technological
trends evolution, the complexity reduction, and the digital services approach. The articles
explain how technological capabilities development has a positive impact on organizational
performance.
IT Roles & Evolution: Keynote Speech
The speech of Prof. Tobias Kretschmer underlined the main topics to consider for
comprehending digital trends. He explained the new nature of the IT-as-a-Service and
gave food for thought thanks to his academic experience in IT and Strategy, and thanks to
the inputs given by attendees during the meeting.
1. Digital Trends Outlook 2016: IT Roles & Evolution

Prof. Tobias Kretschmer showed last technologies, IT environment and market dynamics
evolution during last years, explaining the main business opportunities possible through an
effective management of technology. In particular, he explained how the intelligent network has
an impact on organizations, business opportunities, potential partnership, and interaction among
different industries.
The Professor introduced the importance of ambidexterity and of using market data and
information in order to obtain competitive advantage. Data can lead to a successful change and
they can define the future of Digitization he said.
The meeting focused on the environments right importance for changing; digital technologies
are driving market dynamics and companies business models, helping new agile players to
compete on the market. Different market dynamics cannot be faced just adopting new
technologies in managing old activities, but the challenge is to balance traditional business
practices with new opportunities offered by technology.
In a second time, Prof. Kretschmer suggested a possibility of cost reduction by using digital
technologies. Although Digitization fastness and convenience are different in each industry,
competitive advantage cannot be given by hardware, but by a type of service oriented to
differentiation.
To strengthen his position, Prof. Kretschmer presented a series of case studies, in order to
explain how today the organizations need not only a Vertical Fit, but also a Horizontal Fit to
lead to a competitive advantage.
In these terms, the coherence between business model, organizational structure and IT is
fundamental and it could be reached thanks to information sharing in business units and lines.
A particular focus was given to the difference between Exploration and Exploitation,
considering implications of both the approaches, like the necessity of more or less decisioncontrol.
At the end of the speech, Prof. Kretschmer highlighted the role of Digitization as the key factor
that allows a major knowledge about customers, enabling the creation of innovative services
based on data, granting more and more customization and added value thanks to the IT.
Discussion Details
Time was given to the discussion of the main speech, giving participant from different industries
the opportunity to express their point of view and debate of managerial items.
Pierluca Riminucci, Group Chief Technology Officer at Prada Mr. Riminucci said that
technology is offering many opportunities in retail spaces, especially if it allow companies
to build a relationship with customers. In his opinion, technology is a special key lever
that allows the business to engage customers in the right way and to better understand
what is happening in the market.
Maurizio Romanese, Chief Information Officer at Labelux Mr Romanese answered to

the question In which areas your companies are investing? saying that Labelux has
focused at first in the integration and cooperation. He also said that the company is
investing to enhance online Customer Experience too.
10
Luciano Guglielmi, Chief Information Officer at Mondadori Group After a brief

presentation of his company, Mr. Guglielmi said that they are investing in different areas:
from innovation in retail market to the opportunity to publish and introduce E-books on
the market. According to Mr. Guglielmis view, the best way in which an IT Executive can
succeed is, first of all, using the technology lever to innovate and to support businesss
goals. He must not to be afraid to innovate and change. Secondly, the role of an IT
Executive is to help the business to better understand how to use a technology, just
because usually businesses do not know which kind of technology could help them.
Lastly, the IT Executive should be able to see over the wall and to understand as soon
as possible the next steps. Mr. Guglielmi concluded, saying that managers should change
their skills to better meet the innovation in technology.
Reinhold Grassl, Chief Information Officer at Volkswagen Group Italia Mr. Grassl talked
about Digitization, with particular attention to retail. For instance, today Volkswagen is
investing the 25% of the Communication Budget in Digital Communication instead of in
press and newspapers.
Domenico Solano, Mediterranean Cluster IT Director at Philips Mr. Solano share with
the participants that Philips has decided to characterize the company on the Healthcare.
Managing the Big Data means having the key to transform the original company in a
software one, and even if until today the Data are just the 10% of the success factor in
the business, the situation is going to change, and the percentage will certainly grow.
Graziano Tosi, Head of ICT Application Engineering, UniCredit UBIS Mr. Tosi highlighted
the importance of the difference between a delivery model and an organizational
impact, saying that is very important to leverage on the experience of the business: the
service sold must be a mix of changing models, and the needs must always be
personalized.
Cristina Porzio, Head of IT Business Solutions, Deutsche Bank Cristina Porzio said that
the bank is investing on two front: on one side on the internal Big Data, and on the other
side on the Digital front. Regarding this last area, the business would create a direct
connection with the customers. In her opinion, the next step should be how to use new
technologies in order to speed the business on more creative and valuable ways, even if
banks are not particularly confident with this topic.
Eric Boson, IT Portfolio Manager, Sigma Aldrich Mr. Boson specified that the 50% of
their business goes to e-commerce and a specific digital marketing function was founded
to manage this topic. For this reason, Sial uses to invest both on ERP both on Digital
Marketing.
Giovanni Ferretti, Chief Information and Operation Officer, Seat PG Mr. Ferretti
explained that the company has invested on Big Data and on the development of a
network between the several offices Seat PG has in the Italian territory. He concluded his
speech submit to the participant an interesting question: What will be the future after
the digital development?
11
Livio Barbu Bogdan, Business Assistant to CEO, UniCredit UBIS Mr. Bogdan said that
UniCredit has invested particularly on regulatory requests because the business has
pressures from regulators. He said that today some banks are looking at digital but other
banks do not know the way in which approach this topic, as UniCredit. He contributed
also giving some statistics about Banks customers, saying that the 85% of customers
prefers the digital channels instead of the traditional channels.
Gianluca Giovannetti, IT, Organization and Strategy Realization Director at Gruppo

Amadori According with the experience of Amadori, mr. Giovannetti said that the most
important thing is to analyze customers behavior. Moreover, he decided to invest on BModal approach and on the building of an internal Digital team.
Final Remarks and Key Findings

In this second Communitys session, Prof Kretschmer, thanks to the research and the discussion
among participants, confirmed the take-home points presented during the first meeting in
Rome.
Primarily, the event underlined the importance of learning by failing and the relevance of doing
pilot projects in order to manage the failing and to enable the business to control the change.
Moreover, the meeting underlined the fact that, thanks to Big Data and Digital Channels, there is
a new and deeper knowledge about customers behaviors, from which important data driven
opportunities could be caught. In order to do that, creating a fit between organizational structure
and IT is crucial.
12
Executive Summary
Innovation Trends Presentation and Introduction to the Topic
Researchers Keynote 1
As confirmed by the research, the most important topic of 2016 are related to the analysis of Big
Data and the usage of Innovation as a key lever for business success
Cloud Enabled Innovation
Mobility
Digital Transformation
Social Collaboration
Cloud Computing IT Consumerization
Quantum Computing
Collaborative design
Big Data Analytics
Mobile Payments
Social Listening
T
e
x
t
Digital Asset Management
Managing Change
Digital Governance
Digital Identities
Augmented Reality
Digital Project
Management Office
Multi-Sided Platform
Models
Crowdsourcing
3D printing
Digital trust
Building Digital Innovation

Capabilities
Reputation Management
Digital Payment and

transactions
M
i
n
i
n
g
D
a
t
a
S
t
a
n
d
a
r
d
s
M
i
n
i
n
g
User empowerment
Gamification
Social customer profiling
Digital Ecosystem
Massive Digital Education
Systems
IT Security
Internet of Everything
Digital Business Metrics

Real-time analytics
Designing metrics for digital

innovation
Mobile enterprise
Application Programming Interface
Business Insight
Digital Brand Management
On average in Italian companies, the ratio between Business as Usual and Innovation expenditures
is 80/20, due to legacy and cost pressure
~80%
RUN THE BUSINESS
~20%
Business as Usual
CHANGE THE BUSINESS

Innovation
13
Every company is a Digital Company and every business could learn from the first movers, which
think to digitalization and innovation as their key lever for success
In order to survive to the outdoor evolution, companies need to balance the weight between
internal requirements and market dynamics
RUN THE BUSINESS

RUN THE BUSINESS
Business as Usual
Business as Usual
CHANGE THE BUSINESS

Innovation
CHANGE THE BUSINESS
Innovation
14

If a company decides to move and develop the business, it should take into consideration three
aspects: the Evolution of Processes and Services, the New Technology Adoption and, the New
Mind-set coming from the ICT structure
Digital
Transformation
CHANGE THE
BUSINESS
Skills &
Organization
Design
New
Tech
Adoption
To rationalize todays topic we offer you the BTO Collection, an assortment of articles selected by
the research group
SELECTED CONTRIBUTION
AIM OF THE CONTRIBUTION
Making Sense of Technology Trends in the Information

Technology Landscape: A Design Science Approach
The decision making process would benefit from a

formal problem representation structure for the
analysis of IT development trends and from a reduction
in the complexity of IT landscape
Expanding Business from Products to Digital Services:

value dimensions of digital services enabled by
embedded technology
Due to the re-programmability of digital technology,

new digital services can be designed and added to
existing digitalized products. Embedded digital
technology sets a link between products and producers
Enterprise Business Technology Governance: Three

Competencies to Build Board Digital Leadership
Capability
Building strategic technology capability at all levels

with competent digital change leadership and strategic
positioning from the board has a positive impact on
organization performance. A competence is to lead
Enterprise Business Technology Governance
Best practices in creating value with social media:

insights from four Fortune 500 companies
There are best practices for optimizing eWOM in social

and inter-organization operability, that can foster
improvements and value like brand building, price
premiums and increased loyalty
Social media utilization in business-to-business

relationships of technology industry firms
It is crucial to explore and foster the understanding of

B2B companies external social media use, perceived
potential and barriers against the utilization
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Keynote Speech
Digital Trends Outlook 2016: IT Roles & Evolution
Tobias Kretschmer
Research Areas of Interest

2016 Business Agenda
University of Munich:
Professor of Management
Institute for Strategy,
Technology and
Organization
2016 IT Agenda
Key Digital Trends

IT as a Service Broker
Profile
Tobias Kretschmer currently directs the Institute for Strategy, Technology and Organization at the Munich School of Management at LMU
Munich. He also serves as Co-Director of the Organizations Research Group at LMU Munich. Professor Kretschmer has recently delivered
keynote speeches on ICT, employment and growth and ICT and innovation at international conferences and has published in leading
journals in Economics, Strategy, Information Systems and Organization Science. Prior to joining LMU, Professor Kretschmer taught at London
School of Economics and Political Science (LSE). He holds a Master of Science in Strategy from the University of St. Gallen and a PhD in
Economics from London Business School.
Publications:
The Contribution of ICT to Productivity - Key Conclusions from Surveying the Empirical Literature (with M. Cardona and T. Strobel).
Information Economics and Policy. 3/25 (2013), 109-125.

The effects of rewarding user engagement The case of Facebook apps (with J. Claussen and P. Mayrhofer). Information Systems
Research. 1/24 (2013), 186-200.
Complementarities between Personal Computing and Organizational Structure The Role of Corporate Exploration and Exploitation
The What, the Who, and the How: Coordination Experience and Team Performance in the Electronic Game Industry. Academy of
Management Annual Meeting 2010
Information Technology as a General Purpose Technology and an Agent for Change
General Purpose Technologies

Information Technology
Internet
The Wheel
Electricity
3D Printing
The next digital innovation?
Biotechnology
Writing
16
Intelligent Networks: a potential GPT?
Aggregating
data
Link the
aggregated data
Intelligent processing
of linked data
The IT -producing sector benefits from data-intensive applications

Productivity gains in other sectors through the use of these applications
Conditions:
Users need to recognize the added value
There must be rapid diffusion
Productivity benefits of smart grids arise only through aggregation, linking

and processing a large amount of different data
Cloud-based smart grids have the potential to become a general purpose

technology because they allow far-reaching innovations.
Digital Trends: cloud computing, big data and intelligent networks
eGovernment in the EU
Fluid is developing an expert personal

shopping app powered by IBM
Watson:
natural
dialogue-driven
assistance to help arrive at the best
possible purchase.
Electronic collaboration between Public

administrations can make procedures
quicker, simpler and cheaper for all parties
concerned, in particular when transactions
need to be done cross-border and/or crosssector.
17
Intelligent Networks may stretch existing organizations
Todays business has to be managed, but future demands have to be embraced at

the same time.
Existing managers will rely on intuition and experience to manage stable businesses,
while new segments rely on data-driven, quantitative decision-making to achieve
massive growth rates.
Organizations have to be able to deal with both of these in the same organization;
they have to be ambidextrous.
Through 2015, more than 85% of Fortune 500 organizations will fail to effectively
exploit big data for competitive advantage
Why is this? How can IT (and the CIO especially) in a firm assist the different
businesses in achieving ambidexterity?
Digital Innovation drives change
Data drives Digitization
IDC (2012): The Digital Universe in 2020
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18
The right environment for digital innovation is important
Disruptive changes can be driven by general purpose technologies

Digitization creates new agile competitors!
Retail
News and
Media
Photography
& Printing
Agricultural
Commodities
e-choupal
Advertising &
Marketing
Education
Banks
Movie Rentals
Digital Innovation drives change
Data drives Digitization
What is digitization?
Two views:
Creating digital copies of analog capabilities. The degree to which an enterprises
products and service value and revenues are realized through technology.
Some leaders are redesigning their capabilities and operating models creating
qualitatively new business models, disruptive digital opportunities and superior
returns.
But: Doing old things with new technology doesnt necessarily represent innovation
and is not automatically better.
Balancing electronic capabilities with traditional business practices (hard-copy
documents and correspondence, face-to-face interactions) is a challenge in a digitizing
world.
Digitization changes established organizations and allows for new forms of
organizations.
26
19
Digitization has peculiar characteristics
In daily life, more and more activities are supported digitally or carried out
completely digitally
Investors see large growth potential in digital businesses for the future
Not all companies will withstand and survive the digitization

Other companies manage to adapt and create value from digital services or
software
Digitization opens up opportunities for new business models and companies
Companies are increasingly switching to digital processes as the extent of
digitization is increasing
Digitization has peculiar characteristics
Digitization enables more efficient, decentralized production and innovation

processes.
Personalization provides a higher accuracy of fit between the products and

services and the preferences of the consumers, which increases their
willingness to pay.
But: Does digitizing reduce transaction costs and how?
If the capacity and capabilities are kept within the organization
If the capacity and capabilities are outsourced (e.g. Cloud Computing

provider)
20
Digitization changes existing organizations
Digitization across industries can be highly different:
Booz & Co. (2013): Navigating the Digital Future
Digitization changes existing organizations
Hardware does not give you competitive advantage anymore, its the services
you run that distinguish you.
21
The case of 7 Eleven Japan
The case of Seven-Eleven Japan

Grew to become the highest grossing retailer in Japan.
20-year track record of industry-leading financial returns.
Very savvy about using IT.
Matching local practices and preferences to IT investments, the store can continually
introduce and succeed with new product lines. The typical store adds 70% new items for
sale each year, a higher rate than that of any other retailer in Japan.
Store managers regularly receive graphical data showing recent sales, weather
conditions and product range information.
The convenience-store giant blends its IT investments with a range of assertive IT
practices and capabilities.
The right Horizontal Fit (Organizational structure/HRM practices IT) gives a

competitive advantage.
31
The case of Lufthansa
Sharing information vs. keeping data within the organization

Case of Lufthansa:
Cross subsidy due to sharing of data with partners & credit card offering
Huge volume of fares data available to Lufthansa`s leisure business partners
Possible future services: Sharing some information with Uber or Taxi services for pick-ups
22
Cases of data driven organizations
we search for understanding in every piece of

data, and knowledge in every number
August 24, 2014
Digitization can lead to innovation by offering data driven possibilities like

trendspotting, cool-hunting and personalized offerings.
23
Digitization can lead to new knowledge about customers or the organization

and generate new data driven innovative services.
Data driven organizations extract value from their data
Due to far reaching personalization, the willingness to pay of a user is

increased.
24
Data driven organizations extract value from their data
Data driven organizations have to decide on how freely to share their data for
value creation purposes.
Publishing open data can be supported through three general business models:
Freemium: you provide an added value data product or service, for which
you charge.
Cross subsidy: you reach more customers, or provide enhanced services to

existing customers, through wider sharing and use of your data.
Network effects: by collaborating with other organizations, you reduce

your costs in maintaining data which you use in your work or extend the
possible audience for your products and services.
Innovation is driven by an organizations processing of information
Uncertainty: Limits the ability of the organization to preplan or to make decisions about
activities in advance of their execution.
The greater the uncertainty of the task, the greater the amount of information that has to be
processed between decision makers during the execution of the task.
During the actual task execution more knowledge is acquired which leads to changes in
resource allocations, schedules, and priorities.
The greater the task uncertainty, the greater the amount of information that must be
processed among decision makers during task execution to achieve a given level of
performance.
Task Certainty
Task Uncertainty
Galbraith, Organization Design: An information processing view,

interfaces Vol. 4 No.3 May 1974
39
25
Organizational environment & strategy matters
Different organizational forms are variations in the strategies of organizations to:

Increase their ability to preplan
Increase their flexibility to adapt to their inability to preplan
Decrease the level of performance required for continued viability
Information processing needs do

information processing capability.
not
always
match
Challenges arise due to growing data sources (Internet of

Things, Mobile sensors, etc.) and demand for extracting value
for the organization.
The growing amount of information can lead to overload.
Organizational environment determines information processing and therefore

innovative ability.
Organizational environment & strategy matters
Organizational Learning theory: Different corporate learning types require different

organization designs
Exploration demands decentralization which allows employee autonomy and therefore
constant experimentation and adaptation.
Coordination oriented
Decision rights allocated low in hierarchy
Exploitation calls for centralization which minimizes output variation and maximizes
efficiency and control.
Control oriented
Decision rights allocated high in hierarchy
Mahr, F. (2010): Aligning Information Technology,

Organization and Strategy.
41
26
IT can complement the organizational environment
IT has to support and complement the organizational form.

Through its capability to facilitate horizontal and vertical information processing IT
can enhance both greater decentralization and greater centralization.
Decentralized coordination
Endow lower-level employees in subunits with more
information
Coordination between subunits (corporate intranets..)
Coordination oriented IT
Firm performance
Control oriented IT
Centralized coordination Transfer of local information from subunits

Dissemination of instructions
Tacit local information will remain nontransferable
42
In young and growing markets, new information has to be gathered and processed
constantly uncertainty is higher and the need to be flexible in unexpected
situations is high
decentralized coordination
In mature and stable markets, there is a wealth of information about similar

transactions uncertainty is lower and information can be used to predict behavior
and plan in advance
centralized coordination
The job of IT also changes with the type of tasks and the maturity of the organization
27
Horizontal fit (organizational structure IT technology)
Relationship between organizational learning, organizational structure and the

right IT on firm performance
Avoid information overload (central decision makers: speed & quality)
Vertical fit (environment organization design)
Matching the information processing requirements of the environment, strategy and
culture with the information processing capacities of organization design
Environment, strategy,
culture
Vertical fit
Organizational design
Organizational structure
HRM practices
Horizontal fit
Information technology
44
Effective information flow supports innovative ability
Trend towards increased intensity of operational information & intensity of digitization.

Middle Management connects technology investments with tangible outcomes at the customer
and operations level. The edge rules in these considerations because value is created at the
edge even though it may be controlled by the center.
With the emergence of Analytics, Big Data and Internet of Things a trend evolves:
Middle management is replaced with performance transparency, social coordination,
purpose driven cultures, meritocracy and democratized decision-making.
Innovative companies should think about how these new options could help them allocate
their resources more efficiently.
This can be accomplished by changing structures and processes to share

information and insights across business units and functions to make sure the
business model, organizational structure and IT fit together.
28
IT as part of organization
Roles of organization:
Increase firm ability to preplan.
Business analytics, Big Data, centralization of information
Increase their flexibility to adapt to their inability to preplan.
Distributed information, decentralization of information

Decrease the level of performance required for continued viability.
Variable costs, ITaaS
IT as a Service
Three levels:
Infrastructure as a Service the metered resource is storage space
Platform as a Service infrastructure and basic resources like operating system
etc.
Software as a Service on-demand software
Goal is to make previously fixed costs variable and based on actual usage
Efficient for rarely used, generic services
29
IT as a Service
Infrastructure as a Service Kroll Factual Data, a provider of business

information to mortgage lenders, migrated to Oracle Databases hosted on
Microsoft Platform
Advantages:
Enables growing businesses flexibly through scalability
Secures constant service
Increased data security
48
IT as a Service
Platform as a Service Apprenda develops, delivers and manages JP

Morgan Chases portfolio of internal applications in a private cloud
Advantages:
Single-click rapid app deployment (5mins)
Pay as you go pricing
Standardization of software architecture
49
30
IT as a Service
Software as a Service Salesforce.com provides a CRM system to British

Gas CHI (Central Heating Installation) Department
Advantages:
Standardize lead lists by sales reps and enable electronic storage

Customer support can draw on institutional knowledge and becomes
trackable and accountable
Ability to gather and analyze customer data systematically without
capital outlay of a standalone system
What does this mean for corporate IT and the CIO?
IT becomes less important: IT in itself is not a source of competitive advantage, cost savings
etc. anymore
Just because youre good at managing IT doesnt make you a successful firm!
IT becomes more important: IT is an integral part of a well-functioning organization and
cannot be viewed in isolation
If you cannot manage your IT well, you may not be able to compete successfully or even
survive!!
IT will have to be part of a large-scale analysis of the information needs of the firm and will
have to be designed in combination with the other organizational elements
Treating IT as a cost center is outdated; just like corporate strategy, marketing etc. form an
intricate part of what the organization is about, so does IT!
31
Selected Contributions
Making Sense of Technology Trends in the Information Technology Landscape
The whole number of available technologies and the complex set of relationships among them
make decisions on IT investment even more challenging for IT Executives
Context
Facts
Consequence
Both past and current IT investments and partnership

play a significant role in future investment
Senior managers must predict IT landscape to position

their firms investments in respect with emerging market
opportunities, regardless the difficulty to forecast
advances and trends in IT
Strategic IT investment decisions are often outsourced to

partners and suppliers, as consulting firms, potentially
leading to biased and generic advice
Insights from IT experts, from both business and

academia, reinforce the importance of providing new
techniques to aid practitioners in evaluating IT trends
New
techniques
to
help
practitioners evaluating trends in
the IT field are needed;
Combining principles and sensemaking strategies of process theory
a new tool was developed to
model, visualize, and analyze
trends in the IT landscape.
FOCUS POINT: The decision making process would benefit from a formal problem representation
structure for the analysis of IT development trends and from a reduction in the complexity of IT
landscape
The visual mapping strategy shows large quantities of data in a relatively little space and may be
used to explain how complex outcome evolves over time
Two complementary strategies: Visual mapping
Visual mapping strategy

or graph-based approach, refers to the
graphical representation of process data and
consists of:
Codifying
technological
innovations
based on the role they play within an
ecosystem (i.e. Component, Product or
Infrastructure)
Determining the dominance of a role in
each specific time period
Representing patterns focusing on the
transitions from one set of dominant roles
to another
Under few simplifying assumptions*, we can use

educated speculation to forecast future patterns
of technological change
* (i) technological change will continue to occur following the same patterns; (ii) the role of external forces (e.g. market dynamics),
the demand environment, and context-specific factors (as society and culture) are excluded from the model
32
Combined with the visual mapping strategy, a quantitative approach provides the ideal lens to
add rigor to the identification of evolutionary patterns
Two complementary strategies: Quantification

21
used to empirically identify patterns of

technology evolution works as follows:
16
Codes raw technology introduction data

into roles
Derives estimated frequency functions
for each role based on the proportion of
each role
Using
proportional
frequency
as
thresholds, determines the dominant
technology role in each time period
A state diagram represents the transitions
across technology evolution patterns
Frequency
Quantification strategy
Infrastructure
11
Components
Products
1
0
10
12
Periods of time
Under few simplifying assumptions*, we can use

educated speculation to forecast future patterns
of technological change
* (i) technological change will continue to occur following the same patterns; (ii) the role of external forces (e.g. market dynamics),
the demand environment, and context-specific factors (as society and culture) are excluded from the model
Evaluating the utility of the methodology in a business setting confirms that it provides the formal
problem representation structure able to complement existing approaches
Assessment of the model

Dimensions
Description
Complexity reduction
The use of technology roles and paths of influence provides structure to

reduce complexity. Moreover, it forces the analyst to consider
interdependencies among technologies
Structure for IT investment

decision making
This methodology provides means for generating representations of the IT

landscape that is relevant to the firms interests and business context,
bringing the ability to work interdisciplinary within an organization
Formal method to quantify

technological change
Opposite to current practices, the proposed method use formal

quantitative means to produce technology forecasts within the IT
landscape
Locus of value for the artifacts
Complementary value
of the proposed artifacts
The information produced by the model would be useful to decision

makers in both IT-consuming and IT-producing firms, as well to those
third parties (e.g. vendors and consultants) which IT-consuming firms
consult
The proposed method to analyze IT landscape will complement existing
techniques by providing structured input and formal analysis of the past
and current state of the IT landscape
33
Expanding Business from Products to Digital Services

Due to the re-programmability of digital technology, new digital services can be designed and
added to existing digitalized products. Once products are sold, embedded digital technology sets
a link between products and producers
A framework to investigate value dimensions

Digital Capabilities
The digital capability in products creates opportunities for firms to make

new value propositions to customers by designing digital service offerings
Technological Feasibility
A company needs to articulate value propositions based on the offerings

enabled by the technology; however, services need to be developed
together with customers so that the latter can perceive value
Information Sharing
To help the customers perceive the value of services, information needs

to be shared between firms and customers
Customer Needs
Interactions with customers should not be neglected in order to

understand customers needs
Tangible
Customers perception of value is connected to the value propositions

that companies make with a new product or service offering
Intangible
One of the most delicate issue is the understanding of desired intangible

value that can be achieved; customer perceived value comprises the
perception of intangible outcomes that they desire from a service offering
Embedded
IT
Information
mindset
Values
Firms may identify new value dimensions of digital services, namely value in connectivity and
value in architecture, which are enabled by embedded digital technology in tangible products
Value dimensions to business
Value in use
Customers perceive the value of digital services while using digitalized

products and interact with a firm to express the desired outcomes from
digital services
Value in co-creation
First, knowledge is shared between the firm and target customers in

designing digital services, then firms share digital contents obtained from
digitalized services to their customers. Knowledge sharing can be
continued to innovate and redesign the services once service provision
begins
Value in exchange
Manufacturing firms have the possibility to conduct business with digital

services in a way that evaluates the potential of the digital services by
creating service packages and set prices for the packages
Value in connectivity
Digitalized products work as medium for data generation and

transmission. This value does not rely on the active role of customers, but
it does depend on a firms continuous and active dealings with the data
collected from products
Value in architecture
Due to the combination of modular product components with digital

technological layers, the firms now can offer not only tangible products,
but also continuously design and offer digital services
4
5
34
Enterprise Business Technology Governance

There is growing evidence that digitally mature boards providing competent digital leadership
outperform their peers; this suggests that this new boards role increasingly contributes to growing
business value in the digital economy
The role of strategic technology capability

Lack of
technology savvy
board members
Prospects
Skills set
Even though executives and directors recognize the importance of technology to

their business, less than 20% identify as having Enterprise Business
Technology Governance (EBTG) competent directors (i.e. able to lead and
oversee enterprise technologies)
A boards digital leadership capability, particularly in the field of EBTG, enables
the enterprise to effectively oversee a range of technology-related risks and
whether IT-related topics make it onto the board agenda
It is vital to further clarify the boards role in EBTG as well as the knowledge,
skills, and experience that support board level digital leadership
FOCUS POINT: Building strategic technology capability at all levels with competent digital
change leadership and strategic positioning from the board has a positive impact on organization
performance. In fact, irrespective of the size or type of organization, one of the board of directors
competences is to lead Enterprise Business Technology Governance
A multi-method approach identified three EBTG competencies able to cover the pervasiveness of
technology in every aspect of business, including its design, delivery and measurement
Three competencies
Direct and govern technology1 step the advantages of
to maximize
technology
and
enhance
performance at all levels of the
organization
This competency covers the skills, knowledge and experience to

govern technology for strategic advantage and firm performance.
In particular, it develops understanding of external and internal
digital technology environments and the impact of new and
emerging technologies
Lead and govern business

technology
2 step investment and
risk
by
making
quality
technology related judgments
and decisions
This competency consists of making technology decisions and

governing risk. It ensures that board attitudes and beliefs
enhance digital opportunities, and makes sure that the capability
of its workforce remains viable in the future
1 enabled strategy and planning
3 Direct and govern technology-
enabled
innovation and value
3step
creation,
by
overseeing
technology use to achieve
returns and demonstrate value
This competency addresses using technology to achieve returns

and demonstrate values. It implies asking the right questions,
critically evaluating responses, and being competent to
challenge them
35
Social Media utilization in Business-to-Business relationship of Technology industry firms

Despite companies that make use of business-to-business social media and benefit greatly from
these investments, external social media adoption remains low
B2B challenges in using social media
Social media has been demonstrated to enhance

communication, interaction and learning, bringing
significant benefits to organization
Regardless the current low understanding of social

media in B2B companies, the adoption of such
applications may be very fast in certain business area
The B2B context includes several information security

risks and IPR challenges limiting the use of social
media
An empirical survey of 125

B2B companies in the
Finnish technology industry
shows that in all these
industry sectors, social
media adoption is low,
with external utilization
(i.e. with customers and
partners) lagging behind
internal one
FOCUS POINT: It is crucial to explore and foster the understanding of B2B companies external
social media use, perceived potential and barriers against the utilization
Research shows that there is a significant gap between the perceived potential of social media
and social media use with customers and partners
Research Results
Reasons for not utilizing

social media
The reluctance against adopting social media is mainly due to other projects
being more important, and incapability to measure or assess the benefits
for business. In addition, the most important barriers are the generic lack of
good case studies and know-how.
The adoption of social media with external utilization purpose does not
differ neither with respect to sales turnover nor with respect to firm size
Adoption process
Empirical findings suggest that companies first test and experiment with
novel technologies and practices internally, and expand the use to
customers or external parties only in next stages; this seems to hold also for
social media
Perceived
social media potential
Analyzing social media potential in the customer interface, there is strong

positive correlation between social media use and perceived potential in
marketing. Among companies using social media externally at least
moderately, high potential is perceived in employer branding and
recruitment, general communication with partners and customers and
sales support
36
Best practices in creating Value with Social Media

Successful firms are creating value through a solid social media strategy in the information system
field. The identification of guiding objectives help to set the direction of social media practices in
firms
Understanding the role of eWOM

Defining eWOM
Through social media it is
possible to track every positive
or negative statement made by
potential,
actual,
former
customers,
competitors,
activists and employee, which
is made available via the
Internet, the so-called online
word-of-mouth (eWOM)
Strengthening business
Stepping outside your network
The
understanding
and
management
of
eWOM,
minimizing negative statements
and maintaining positive one; for
these reasons, it is crucial to the
success of an organization
When monitoring the eWOM

environment, social media
provide the capacity to add
transparency
and
new
understanding
to
every
relationship in the value chain
and partnerships. In fact, social
media
magnify
corporate
capability to identify future
ventures
FOCUS POINT: There is consensus on the most important design functions and features needed for optimizing
eWOM in social and inter-organization operability; they range from analytics (e.g. advertising analytics, content
analytics and social analytics) to knowledge sharing, easy navigation and other fundamental capabilities (e.g. cocreation, risk management, multi-user capabilities).
These attributes can foster improvements and value like brand building, price premiums, seller differentiation,
increased loyalty, customer satisfaction, improved reputation.
As brand management and CRM has evolved, continuously engaging with clients and monitoring
their need to make changes in products or services is necessary for market awareness and overall
success
Findings
Customer engagement
Since targeted engagement and

social media participation are
measurable, personalized services
are on the rise
A socially ready enterprise is able to attain

new ideas and perspectives from social
media; since the process of taking customer
insights should be consistent, centralized
planning is needed.
Additionally, success can be

achieved by engaging customers
throughout their life-cycle, which
includes
during
building
awareness, product evaluation,
purchase, confirmation of value
delivery, and after sales phases
Analogously, social media is a proper

channel to do problem-solving based on
the needs of clients and improve customer
satisfaction
37
BTORes
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2015-04 Digital Executive Community Proceedings

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DI

Digital Executive Community 24th & 27th April 2015

Digital Executive Community 24th & 27th April 2015

Digital Executive Community 24th & 27th April 2015

DIGITAL TRENDS: OUTLOOK 2016

Hotel Quirinale Rome

Florenzo Marra (BTO)

Andrada Comanac (BTO)

Tommaso Cenci (BTO)

Luca Parravicini (BTO)

Massimo Bellini (BTO)

Fabrizio Conte (BTO)

Francesca Oberti (BTO)

Francesca Donelli (BTO)

Alessandro Banci (ACI)

Mauro Abbattista (Autostrade per lItalia)

Marco Pavonio (Dexia Crediop)

Massimo Morgagni (Dexia Crediop)

Nicola Reina (Enel)

Giovanni Pepicelli (Enel)

Ettore Di Lena (Enel)

Matilde Tizio (Enel)

Sandro Tucci (Eurovita Assicurazioni)

Marco Iacomussi (Finmeccanica)

Andrea Lalli (GTECH)

Stefano Nocentini (Poste Italiane)

Rosanna Lisco (Poste Italiane)

Alberto Alberini (Poste Vita)

Maurizio Irlando (Telecom Italia IT)

Gabriele Sirovich (Trenitalia)

Fabrizio Casali (Unilever)

Digital Executive Community 24th & 27th April 2015

Introduction and Meeting Opening

Digital Trends: Overview

IT Roles & Evolution: Keynote Speech

Digital Executive Community 24th & 27th April 2015

Digital Executive Community 24th & 27th April 2015

Final Remarks and Key Findings

Digital Executive Community 24th & 27th April 2015

Spazio Visconti by BTO Milan

Vincenzo Morabito (BTO)

Florenzo Marra (BTO)

Giovanni Roberto (BTO)

Andrada Comanac (BTO)

Tommaso Cenci (BTO)

Alessandro De Pace (BTO)

Francesco Magro (BTO)

Massimo Bellini (BTO)

Luca Parravicini (BTO)

Martino Scanziani (BTO)

Giulia Galimberti (BTO)

Fabrizio Manzo (BTO)

Fabrizio Conte (BTO)

Arianna Zago (BTO)

Miguel Miranda (BTO)

Adrien Chatillon (BTO)

Valeria Lorenzi (BTO)

Francesca Donelli (BTO)

Francesca Oberti (BTO)

Roberta Rossi (BTO)

Marianna Corsello (BTO)

Digital Executive Community 24th & 27th April 2015

Marco Tempra (Banca Popolare di Sondrio)

Simone Macelloni (Cardif Assicurazioni)