incontecs has specialized as a consulting firm in current topics for the digital transformation and the sustainable development of companies and organizations. In order to support you well in your business development, we can not only draw on more than 30 years of knowledge, experience and networks from diverse customer projects with medium-sized companies and international corporations in different industries and in various countries, but also on actual information from the great commitment of the company founders and managing directors in various honorary positions and committees in business, science and politics as well as in teaching and research at private and public universities.
Wernher von Braun
Digital transformation is the process of change that affects companies and the entire society through the application of digital technologies and innovations and their implications. Under these conditions, how can digital business models and business processes be designed to ensure successful business development in the future?
Keywords in the field of Digital Transformation
Digitalization is the transformation of business models and processes due to the use of information and communication technologies. Aspects of digitalization are:
- Electronic collection and evaluation of data (data processing)
- Autonomously working, self-organizing systems (automation)
- Networking and synchronization of previously separate activities (networks)
- Digital mobile access to the Internet and internal networks (infrastructure)
Digitalization affects almost all aspects of life (production, purchasing, distribution, logistics, infrastructure, transport, health, education, housing, leisure, etc.). The impact of digitalization on industrial value creation and production is described by the term Industry 4.0.
A Business Model describes the rationale of how an organization creates, delivers and captures value. A Business Idea is a concept with which an economic existence can be established. An innovative business idea is based on a new product or a new service, which is not yet known in the market and whose needs are difficult to estimate.
A Business Model Pattern describes business models with similar characteristics, building blocks or behaviors. Some important concepts of business model patterns are:
- Unbundling business models
- Long Tail
- Multi-Sided Platforms
- Open Business Models
Digital Business Models are business models based on vendors’ virtual performance promises to customers. For the service provision by the provider or the use by the customer, information technology is mandatory.
A Business Process is a logical sequence of value-added activities that transform one or more inputs into an output for the benefit of the customer. Depending on the aggregation level, a business process can consist of one or more subprocesses. A Workflow describes how the individual processes build on each other.
Digital Business Processes are business processes that are completely or partially digitally implemented through the use of information technology and can be controlled via IT systems.
Value Creation Networks are decentralized, polycentric networks of autonomous, legally independent actors that form a pool of potential value-added partners that are occasionally configured in an economically motivated way to create value chains. The formation is geared to the sustainable achievement of economic added value. The backbone of communication and interaction is a distributed information system.
A Platform is a business model that enables value-adding interactions between external consumers and producers. One also speaks of two-sided or multi-sided markets:
- Uber, the world’s largest taxi company, has no vehicles.
- Facebook, the world’s largest medium, does not produce content.
- Alibaba, the world’s most valuable merchant, has no inventory.
- AirBnB, the world’s largest room broker, has no property.
Digital Platforms are creating these interactions through digital technologies that provide all users with non-restrictive access to the platform and enable matchmaking among large user groups.
Digital technologies based on hardware, software and networks are becoming more and more complex and are evolving rapidly. They are the triggers for digital transformation in companies and the entire society. Which technologies are relevant, what are the developments in the technology fields and what can be used for business success in the future?
Keywords in the field of Digital Technologies
Technology Management is the planning, execution and control of the development and application of (new) technologies to create competitive advantages.
Technology management has significant overlaps with innovation management as well as with research and development management (R&D management). Often, the design and development of new technologies is seen as a more application- and market-neutral phase throughout the innovation process. In contrast, innovation management extends to the market launch of new products or the use of new production processes. Research and Development (R&D) creates the knowledge base for market introduction. R&D management can thus also be seen as a link between technology and innovation management.
Technology management also includes the external sourcing of technological know-how, e.g. through the purchase of patents, the use of licenses and the integration of suitable suppliers, while innovation management and R&D management are primarily focused on internal company processes. If research and development produces results that are not meaningful to the company, but can be exploited through licensing or patent sales, then technology management is the extension of R&D management to include external technology acquisition and external technology exploitation.
Cloud Computing refers to the provision of IT infrastructure (e.g. storage space, processing power, or application software) as a service over the Internet.
Big Data refers to mass data that is too large, complex or fast-moving for classical data processing, and that requires special algorithms for analysis, evaluation and use.
Artificial Intelligence is a branch of computer science that deals with the development of computer systems that can independently perform functions that normally require human intelligence.
Autonomous Mobile Robots are robots that can move and act independently in their environment.
Augmented Reality refers to a computer-assisted perception or representation that expands the real world with virtual aspects.
Additive Manufacturing (“3D printing”) refers to a process in which a component is built up layer by layer on the basis of digital 3D design data by depositing material.
Embedded Systems combine the complete signal processing, data processing and communication in miniaturized form with intelligent sensors and actuators.
Blockchain is a basic technology for a decentralized, chronologically updated database with a network-generated consensus mechanism for the permanent digital storage of transactions.
Digital innovations are among the key competitive factors for companies. To be highly innovative, innovative processes and structures must be defined in the corporate strategy. How to develop new business ideas, implement digital services and business models, and use the success factors of the startup scene?
Keywords in the field of Digital Innovations
Innovation Management is the systematic planning and control of innovations in organizations. In contrast to creativity techniques that focus on the development of ideas, innovation management also deals with the commercial exploitation of ideas and their implementation in economically successful products and services.
Innovation management is part of the corporate strategy implementation and can relate to products, services, manufacturing processes, organizational structures and management processes. While product innovation and service innovation are typically designed to better serve the needs of customers, process innovation tends to focus on improving the effectiveness and efficiency of in-house processes. Business model innovation, on the other hand, is a deliberate change of an existing business model or the creation of a new business model for an existing organization.
Corporate Entrepreneurship describes entrepreneurial behavior within medium and large enterprises. Objective is to create an entrepreneurial operating innovative organization.
The term Entrepreneurship is not clearly defined in the scientific literature. It leads back to the French word “entreprendre” which means “do something” or “take something into your own hands”. Innovation and entrepreneurial opportunities characterize entrepreneurship. Entrepreneurship is an entrepreneurial process of the implementation of innovative products and production methods. The general understanding of entrepreneurship refers not only to the newness of the products, but it is based on attitude, action and the willingness of entrepreneurs to take risks. The German words “Unternehmertum” and “Unternehmer” are often used for the terms entrepreneurship and entrepreneur, but they are not identical.
Value Proposition Design is a method to design innovative products and services that exactly meet the needs and desires of the customers.
Value Proposition Canvas allow a structured presentation and visualization of value propositions and customer segments that are used as building blocks in Business Model Canvas. They consist of a Value Map and a Customer Profile.
Business Model Canvas allow a structured representation and visualization of business ideas and business models. They represent graphically the following building blocks of a business model:
- Customer Segments
- Value Propositions
- Customer Relationships
- Revenue Streams
- Key Resources
- Key Activities
- Key Partnerships
- Cost Structure
Design Techniques are methods to promote creativity and generating new ideas targeted to develop visions or solve problems. They can help to design better and more innovative business models. Design techniques are primarily used in workshops where a group of people often explores unfamiliar terrain while designing business models. Well‐known design techniques for business models are:
- Customer Insights
- Visual Thinking
Design Thinking is an approach designed to solve problems and develop new ideas. It starts from the assumption that problems can be better solved if people from different disciplines work together in a creativity-boosting environment to find the optimum solution from the customer’s point of view.
The Design Thinking Process is based on the workflow of designers and consists of 6 phases:
- Understand the challenge
- Observe the users
- Define a point of view
- Find ideas
- Develop prototypes
The Lean Startup method is a method for the iterative search for a viable business model in several steps:
- Founders translate ideas into business model hypotheses, test assumptions about the needs of the customers and create a minimal functional product to try out the solution to customers.
- The company continues to test all other hypotheses and attempts to validate the interest of the customer through early orders or the use of the product. If there is no interest, the company can re‐align by changing one or more hypotheses.
- The product will be revised to the extent that it can be sold. Based on its proven hypotheses, the company generates demand by boosting up marketing and sales quickly and expanding the company.
- The company slowly leaves the startup mode, in which a team for customer development seeks answers, and forms functional departments for the implementation of the business model.
Open Innovation is a paradigm that assumes that firms can and should use external as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology. Alternatively, it is “innovating with partners by sharing risk and sharing reward“. The boundaries between a firm and its environment have become more permeable; innovations can easily transfer inward and outward.
The central idea behind open innovation is that, in a world of widely distributed knowledge, companies cannot afford to rely entirely on their own research, but should instead buy or license processes or inventions (i.e. patents) from other companies. In addition, internal inventions not being used in a firm’s business should be taken outside the company (e.g. through licensing, joint ventures or spin‐offs). Open innovation offers several benefits to companies operating on a program of global collaboration:
- Reduced cost of conducting research and development.
- Potential for improvement in development productivity.
- Incorporation of customers early in the development process.
- Increase in accuracy for market research and customer targeting.
- Potential for viral marketing.
The open innovation paradigm can be interpreted to go beyond just using external sources of innovation such as customers, rival companies, and academic institutions, and can be as much a change in the use, management, and employment of intellectual property as it is in the technical and research driven generation of intellectual property.
Corporate Venturing refers to venture capital provided by industrial companies, where investors pursue not only financial but primarily strategic goals. Venture Capital refers to a temporary transfer of financial resources to companies in the form of equity shares.
Corporate Venturing can be divided into internal, cooperative and external corporate venturing. Internal Corporate Venturing refers to the financing of internal activities of the company, for example as Venture Team or Technology Accelerator. Cooperative Corporate Venturing refers to the financing of activities in cooperation with other companies, for example as Spin-Off or Joint Venture. External Corporate Venturing refers to the financing of external activities of the company, for example by investments in other companies.
Product-Service-Systems (PSS) are a marketable set of products and services capable of jointly fulfilling a customer’s needs.
The initial move to PSS was largely motivated by the need of some traditionally oriented manufacturing firms to cope with changing market forces and the recognition that services in combination with products could provide higher profits than products alone. Faced with shrinking markets and increased standardization of their products, these firms saw service income as a new path towards profits and growth.
PSS can be defined as a system of products, services, supporting networks, and infrastructure that is designed to be competitive, satisfy customers’ needs, and has a lower environmental impact than traditional business models. While not all PSS result in the reduction of material consumption, they are more widely being recognized as an important part of a firm’s environmental strategy.
PSS can be categorized by two distinguishing features: the performance orientation of the dominant revenue mechanism and the degree of integration between product and service elements.
Digital factory is the generic term for a comprehensive network of models, methods and tools with an integrated data management. The goal is a holistic planning, control, evaluation and continuous improvement of all structures, processes and resources in the real factory. Which concepts are relevant for this in the future?
Keywords in the field of Digital Factory
The term Industry 4.0 stands for the fourth industrial revolution, a new level of organization and control of the entire value chain over the life cycle of products. The combination of people, objects and systems creates dynamic, real-time-optimized and self-organizing, cross-company value creation networks that can be optimized according to different criteria.
Cyber-Physical Systems (CPS) are microelectronic systems with their own computing power, sensors and actuators as well as additional communication interfaces that are embedded in physical systems and serve for data acquisition and data transmission.
Cyber-Physical Production Systems (CPPS) enable flexible automation by networking intelligent and versatile machines, systems and products based on cyber-physical systems.
The Internet of Things links the real, physical world with the virtual, digital world through cyber-physical systems and supports the integration of products, production facilities and objects with embedded software into intelligent and distributed systems.
A Digital Factory is a networked, intelligent and versatile factory based on cyber-physical systems and the Internet of Things. It is adaptable in real time and communicates with other participants within the value chain. Characteristics of the digital factory of the future are:
- Increasing automation
- Rationalization of processes
- Decentralized self-organization
- Elimination of routine tasks
- Growing variant variety
- Driverless transport systems
- Complex systems require knowledge and competence
Smart Products bring their manufacturing information in machine-readable form and communicate directly with the manufacturing equipment.
Sustainable business development aims to shape change proactively through entrepreneurial visions, goals and strategies in order to successfully survive on the market. New technologies, markets and competitors are opportunities and challenges. How can sustainable strategies be developed and successfully implemented?
Keywords in the field of Business Development
Strategic Management refers to the development, planning and implementation of content-related goals and orientations of companies and organizations in order to be successful in the long term. The strategic plans usually cover a time horizon of two to five years.
Objects of strategic management are strategies, structures and systems. Strategies determine the business orientation of the company, establish long-term business goals, identify competitive resources, and define the company’s positioning in the marketplace. Structures describe the organization of the company, the type of division of labor and the coordination of work-related task fulfillment. Systems define the company’s infrastructure, incentive system, management tools and management information system.
Levels of strategic management, depending on the level of aggregation, are the company level, the business unit level, the industry level, and the macro level.
Value-Based Management describes a management approach that concentrates on sustainably increasing the value of the company instead of sales and profits. The value of equity serves as a measure. For a sustainable success of this shareholder value approach, value enhancing strategies, a suitable incentive system, appropriate management tools and an efficient reporting system must be implemented.
Value-based management, however, not only focuses on providing an appropriate return to shareholders, but also on innovative products, attractive services, secure jobs and a good working atmosphere. This approach is based on the assumption that a company can only be successful if it takes into account the interests of all stakeholders.
International Management includes the management of international business. From a functional point of view, it refers to the leadership of international companies and deals with all issues that arise in cross-border business activities.
A Business Strategy defines the activity structure of a company in a strategic business area. It is derived from the corporate strategy and aims to achieve and secure competitive advantages. Business units may be definable planning units by product or product group, customer segment, business area or distribution channel. Business strategies aim at cost leadership, differentiation or specialization (focusing).
Business Intelligence describes procedures and processes for the systematic analysis of your own company by collecting, evaluating and presenting data in electronic form. The goal is to gain insights to support operational and strategic decisions that are aligned with corporate goals. The evaluation of the data about the own company, the competitors or the market development happens with the help of analytical concepts as well as appropriate software and IT systems. With the knowledge gained, the company can make its business processes as well as its customer and supplier relationships more successful; Aspects here can be cost reduction, risk reduction and added value.
Globalization, digitalization and international mobility of goods and people increasingly facilitate foreign activities of small and medium-sized enterprises. In many industries, a global presence will be required in the future. Which foreign markets are promising, what are the strategies for internationalization, and who can provide useful support?
Keywords in the field of International Business
Industrialized Countries are states whose economy is mainly driven by industry. These countries have a high per-capita income, a high technology standard, capital-intensive goods production, very high productivity, a high level of education, active external relations and a convertible and stable currency.
Developing Countries are states where the majority of residents have a measurably low standard of living in terms of economic and social conditions. These are reflected in poor food and consumer goods supply, poverty, malnutrition and hunger, health care limitations, a high infant mortality rate and low life expectancy, poor educational opportunities and a high illiteracy and unemployment rate.
Emerging Countries are states that are traditionally still considered as developing countries, but no longer have their typical characteristics. These countries are at the beginning or in an advanced process of industrialization by restructuring economic structures from agriculture to industrial production. Opposites between poor and rich, and differences between conservative forces and parties seeking modernization, often lead to tensions.
Development Cooperation is the joint effort of industrialized and developing countries to permanently and sustainably reduce global differences in socio-economic development and living conditions. It is also referred to as development assistance or technical cooperation.
State development cooperation can be divided into multilateral and bilateral development cooperation. Development assistance from industrialized countries, the European Union and the United Nations is mostly carried out by public agencies. Important actors in development cooperation are non-governmental organizations (NGOs), which specialize in various topics. Also economy is increasingly involved in development cooperation projects. Companies can use their know-how in technical cooperation projects to build and expand their business in developing countries.
Foreign Trade Promotion refers to all information, advisory, contact and placement activities that serve to increase the international business and competitiveness of small and medium-sized enterprises. This includes all support measures aimed at the development and implementation of internationalization strategies of companies. These include the promotion of direct export, strategic alliances, foreign trade fairs, delegation trips, network cooperation and direct investments.
A Market Entry Strategy defines the timing and the measures for the introduction of products and services in a new foreign market as part of the international management of a company. Depending on the country and the degree of internationalization of the company, different types of market cultivation can be considered:
- Sales organization
- Joint venture
- Foreign branch
- Production plant
- Subsidiary company
Project Development refers to the conception and planning for the creation of generally larger (infrastructure) projects. It represents a combination of the factors location, capital and project idea and covers all investigations, business decisions, planning and preparatory measures as well as the financing and the creation of the (infrastructure) project up to the sale or operation.
Sustainable, ecologically and socially responsible action is increasingly expected by customers, business partners and suppliers worldwide. Sustainability is the basis for successful corporate development. Innovative environmental technologies create global markets in the green economy. Which strategies for sustainable development make economic sense?
Keywords in the field of Sustainability
The UN General Assembly adopted the “Agenda 2030 for Sustainable Development” in September 2015. It is a United Nations global plan of action for people, the planet and prosperity. The Agenda 2030 includes 17 Sustainable Development Goals in the sense of a sustainable transformation of society, economy and environment, to which all member states have committed by the year 2030.
Political goals for sustainable growth in Europe:
- Building a more competitive low‐carbon economy that makes efficient, sustainable use of resources.
- Protecting the environment, reducing emissions and preventing biodiversity loss.
- Capitalizing on Europe’s leadership in developing new green technologies and production methods.
- Introducing efficient smart electricity grids.
- Harnessing EU‐scale networks to give European businesses (especially small manufacturing firms) an additional competitive advantage.
- Improving the business environment (in particular for SMEs).
Corporate Social Responsibility (CSR) refers to the voluntary contribution of business to sustainable development that goes beyond legal requirements. CSR is based on the UN Sustainable Development Goals and stands for responsible entrepreneurial action in the actual business activity (market), in ecologically relevant aspects (environment), in relationships with employees (workplace) and in the exchange with relevant stakeholders.
Resource Efficiency is defined as the ratio of a particular benefit to the required use of natural resources. The benefit can be provided in the form of a product or service. The lower the required input of natural resources or the higher the benefit of the product or service, the higher is the resource efficiency.
Natural Resources are components or functions of nature that have an economic benefit. These include raw materials, space as well as the function and quality of components of the environment such as soil, air and water.
Resource efficiency as a political goal:
- Avoidance of supply bottlenecks (technical and economic availability of certain raw materials).
- Raising of market potential and competitive advantages for resource efficiency technologies in the sense of ecological modernization of the economy.
- Reduction of negative environmental effects resulting from the extraction and processing of raw materials, the manufacturing of semi‐finished and finished goods as well as the use of the generated products and their disposal.
- Compliance with planetary sustainability boundaries.
- Preservation of natural resources for future generations.
Climate Protection is the collective term for all measures that counteract human‐induced global warming and mitigate possible consequences or even prevent them.
Global Warming refers to the rise in the average temperature of the lower atmosphere and the oceans, which has been observed since the middle of the 19th century. By Climate Research expected and partly already observable consequences of global warming include depending on the Earth region: sea ice and glaciers melt, sea level rise, thawing of permafrost, growing arid zones and increasing weather extremes with corresponding repercussions on the life and survival situation of people and animals.
Climate protection as a political goal:
- Reduction of the consumption of fossil fuels.
- Reduction of the emission of greenhouse gases that are released by industrial and agricultural production, by energy consumption in transport, in private homes and in public spaces.
- Preservation and promotion of such natural components that can accommodate the quantitatively most significant greenhouse gas carbon dioxide (oceans, tropical rain forests, boreal forests, wetlands).
- Measures to adapt to the unavoidable climate change (dike construction, disaster preparedness).
- Education and behavioral changes of people, especially in industrialized countries with high energy consumption and greenhouse gas emissions.
Megatrends have a half-life of at least 25 to 30 years, are persistent against short-term fluctuations, occur in all possible areas of life and in principle have a global character. Current megatrends are:
- New Learning
- New Work
- Silver Society
- Female Shift
Green Technologies define technologies for environmental and climate protection as well as for sustainable and efficient use of natural resources. Green Innovation defines innovative processes, products and services based on Green Technologies. Green Business defines enterprises which offer products and services in the field of Green Technologies.
Green Economy covers the business sectors of Green Business:
- Automobile and Transport
- Bio Fuels and Agriculture
- Energy Management and Efficiency
- Renewable Energy Technologies
- Energy Storage
- Nanotechnology and Nanomaterials
- Waste Management
- Water and Waste Water
Green Investments are investment activities that focus on companies or projects that are committed to the conservation of natural resources, the production and discovery of alternative energy sources, the implementation of clean air and water projects, and/or other environmentally conscious business practices.
Smart City is a collective term for holistic development concepts that aim to make cities more efficient, technologically more advanced, greener and more social. These concepts include technical, economic and social innovations. The focus here is on dealing with environmental pollution, demographic change, population growth and scarcity of resources, but also concepts such as sharing (Share Economy) or citizen participation.
The following terms are also used for the “smartness” of various areas: Smart Economy, Smart People, Smart Governance, Smart Mobility, Smart Environment and Smart Living.
A Smart Grid is an “intelligent network” with partly decentralized producers and decentralized energy management. Smart Metering refers to the remote reading of meter data as well as an extensive network of decentralized infrastructures and complex control units. A Smart Home includes solutions for more energy efficiency, comfort, economy, flexibility and security in the home.