"A completely new customer experience"
In the fall of 2017, Detecon opened the Digital Engineering Centers for Co-Innovation, Data Analytics, Cyber-Security, and Industrial IoT in Berlin. We spoke to founder Steffen Kuhn about objectives and methods – and the role that the new innovation hub will play in corporate consulting in the future.
DMR:Steffen, what does the term “Digital Engineering Center” actually encompass?
S. Kuhn: It is the embodiment of our dedicated orientation to the opportunities and risks of digitalization. Our clients will be facing new challenges and demands because of the shortening of innovation cycles and disruptive technologies. Simultaneously, however, completely new innovative opportunities will arise. And that is exactly the point where our Engineering Centers come in. Our address of clients from consulting activities is linked consistently with high-level technology and innovation expertise, our current level of expertise is expanded by additional specialist skills, and our consulting services are continuously enhanced by the addition of tools and methods, all via the Digital Engineering Centers. Moreover, we assure their transfer from the innovation and partner ecosystem to daily practice and their implementation there. There is a tightly-knit cooperation with all of the Deutsche Telekom units. We collaborate very closely with the experts from the business account, product, and network innovation departments – in complete harmony with the ideas of co-innovation and creation. At the moment, there are four Centers revolving around co-innovation, data analytics, cybersecurity, and industrial IoT, whereby these Centers work together very closely because the synergies among these fields in particular open up completely new opportunities.
DMR:What fundamental objective is Detecon pursuing with the establishment of the Digital Engineering Centers?
S. Kuhn: The aim is to establish something new in the consulting environment by extending our added-value depth and our portfolio. Specifically, we are focusing on two dimensions. One, we are zeroing in on research and innovation topics so that the next wave of game-changing developments can be identified early and prepared for our clients. Second, there is a greater emphasis in the direction of implementable solutions and on their realization through profound technological know-how, e.g., via demonstration versions, prototypes, or proofs of concept (PoC).
DMR:And what concrete results can clients expect?
S. Kuhn: The aim is to start with the opening of an innovation and engineering hub at the Berlin location that will utilize a creative environment and prototyping areas as well as access to innovation ecosystems to generate a completely new customer experience. To realize this, we are establishing partnerships with the academic world (the TU Berlin, for example), with startups, and with existing digital hubs such as Telekom’s T-Labs and leading industrial players. We want to integrate existing know-how and talented young people at an early stage. Tools and methods that can be applied across regional and project boundaries are being developed; we call this “asset-based consulting”. This means that we are working up technical and/or innovative solutions for the questions facing our clients, solutions that map the customer journeys from research and ideation to prototypes and PoCs, but that play an equally significant role in digital process (re-)engineering.
DMR:Can you briefly describe what the focal points for the Engineering Centers Co-Innovation, Data Analytics, Cyber-Security, and Industrial IoT will be in terms of content?
S. Kuhn: The Data Analytics Engineering Center will follow a holistic approach that I call “Data Thinking” (analogous to Design Thinking: the editors). Companies are systematically guided along the course of their data challenge, from the generation of the ideas to the definition of data-centric use cases and business models to architectural design and data management. Building on this groundwork, we focus on the realization of the use cases with PoCs to demonstrate feasibility. This is achieved through the use of the appropriate big data tools, analytics algorithms, and the latest AI technologies.
In the Cyber-Security Engineering Center, we assess the security level of our clients’ infrastructures. Recommendations for action based on penetration tests or security by design of products are just as much a part of this as security innovation scouting, a security boot camp with our partners in Israel, or the planning of a stalwart cyber-defense, e.g., with the aid of a Cyber-Defense Center.
In the Co-Innovation Engineering Center, we collaborate with our clients to draw up customer journeys and digital processes based on agile processes such as Design Thinking going all the way to productive applications with our partners. We guide the entire innovation process using portfolio elements such as research and trend analyses, ideation, and prototyping, but include as well testing and innovation.
The Industrial IoT Center, where my colleague Uwe Weber is the director, supports our clients in utilizing the interconnected information from products or objects in the best way possible throughout their entire lifecycle – with the aid of the concept of the digital twin. By employing this industry-specific dynamic software model, we enable our clients to simulate, analyze, and, ultimately, control their ecosystems existing in the physical world from component and sensor data. Test beds reveal how current obstacles can be overcome, e.g., by securing short latency times with the aid of edge computing.
DMR:Why were these four subjects in particular identified?
S. Kuhn: Generally speaking, of course, simply because digitalization comprises precisely these focal points. Every company must deal with these aspects sooner or later, but it would be better not to be too late. Whether the issue is the establishment of digital customer channels, an increase in customer satisfaction, process re-engineering for enhancement of quality and cost reductions, or the establishment of new, data-centric business models – there is something for everybody. The securing of assets and infrastructure using the appropriate security measures must not be forgotten, either. This becomes patently obvious when a few figures and key data are examined. In the area of the Internet of Things (IoT) alone, a BCG study projects total additional investments of $250 billion by 2020. The largest share of this figure – as much as 60% – will be dedicated to the areas of services and analytics. In the area of cybersecurity, the German economy alone suffers losses of €55 billion every year from espionage, sabotage, and data theft. One out of two companies has been affected in the past two years, yet only one out of three companies ever reports these attacks to officials because they fear harm to their image. These figures come from a study commissioned by the digital association Bitkom on the subject of economic protection.
DMR:Why was Berlin chosen as the location?
S. Kuhn: Berlin has a number of advantages. As a city, Berlin is very attractive, sexy, and open, all features that appeal to creative people around the world and that can be sensed on almost every street corner in the city. Berlin is international, and there is already an ecosystem, a kind of epicenter, for new ICT technologies here. With its many universities, research institutes, digital hubs, labs, and incubators, it is a magnet drawing people with outstanding talent, entrepreneurs, startups, and innovators, making it the ideal location for our Digital Engineering Centers.
DMR:Is Berlin Germany’s Silicon Valley?
S. Kuhn: Yes, I would say it is. Berlin is truly one of the most exciting cities when you talk about digitalization, starting up new companies, and creativity. The figures also speak clearly. According to the half-year report of 2017 of the “Startup Barometer”, Berlin is once again far and away the leader of the German startup regions. Just under €1.5 billion has been invested in young companies from Berlin, a figure that corresponds to 68% of all venture capital. Second-place Bavaria is well behind with €213 million.
DMR:How do the Centers guide clients through the digital transformation process, and what services can I as the client concretely expect?
S. Kuhn: Our clients benefit in a number of ways. For one, the drafted concepts and business models in the direction of PoC and demonstration have been expanded so that technical feasibility is discernible. The focus on research and innovation gives clients security for the future and avoids technology shocks. Thanks to the modular portfolio with the flexible opportunities to step in, clients can enter the process as appropriate for the level of their own digital maturity and need not constantly look for new partners along their digital journey because we can go along with them throughout the entire length.
DMR:What do you find especially fascinating about the establishment of the Engineering Centers? What do you regard as the greatest challenge?
S. Kuhn: That’s absolutely clear: finding the right experts and talented people. The demand in these fields is huge. There will be a shortage of 350,000 specialists in Europe in the area of IT security alone between now and 2022. This was the conclusion of the Eighth Global Information Security Workforce Study, which surveyed more than 19,000 cybersecurity experts worldwide. The situation does not look any better for data analytics.
Another decisive point is establishing the appropriate governance so that synergies are created between consultants and technology experts. While this is a challenge, it is at the same time an enormous opportunity. This becomes apparent as well from the feedback from the applicants who are looking to come to Detecon precisely because they want to be involved in the establishment of the Digital Engineering Centers.
DMR:Do you see only opportunities in digitalization, or are risks apparent to you as well?
S. Kuhn: Naturally, I see the opportunities in companies and in the private sphere as well. Many things can be made simpler – having knowledge and information at your fingertips at the press of a button, advances in medicine, worldwide networks, personalized products, music and video, all on demand, fitness tracker, shopping from the couch with delivery in 24 hours. After all, we frequently ask ourselves: How did we get along without this before? On the other hand, it is not really possible to shut yourself off completely anymore; you always have the feeling you might be missing out. This is a borderline situation, and over the long run, it is not healthy. What’s more, I don’t like all the empty store windows we see because our changes in consumption behavior force many retailers out of business when they cannot compete with Amazon, Zalando, and all the rest.
DMR:Can you understand the critical remarks from Elon Musk, the entrepreneur, who warns about the dangers of an uncontrolled spread of autonomous machines?
S. Kuhn: That is definitely a subject for discussion. I always think of the quote about “the spirits that I’ve summoned.” Now, I wouldn’t go so far as Musk and start warning about “killer robots.” Other highly prominent and knowledgeable figures such as Bill Gates, Steve Wozniak, and Stephen Hawking have, of course, also expressed serious concerns about this subject. The implications are enormous, and intelligent mechanisms and concepts are called for, defined and developed by intelligent people. The issues range from loss of jobs and minimum wages to ethics and liability regulations to the so-called “kill switch” that should be available as an emergency button to stop machines at any time. I would say that this is a field where we at Detecon in particular, along with our partners, can contribute to securing a differentiated expert viewpoint on opportunities and risks. We can recognize the dangers of the misuse of AI systems at an early stage, for instance, and reduce risks right from the moment we start to design customer solutions.
About Steffen Kuhn
Steffen Kuhn is a recognized expert for innovation and digitalization subjects. He has been Managing Partner at Detecon since June 2017 and founded the Digital Engineering Centers. He previously held various management positions in the Deutsche Telekom Group. After earning his degree in communications technology, he began his professional career in strategy consulting. While Director Innovation and New Business Development at T-Systems, he was in charge of growth topics on the enterprise market. At Deutsche Telekom, he directed the group-wide innovation strategy. In 2012, he became a member of the Executive Board at Telekom Innovation Laboratories (T-Labs), where he was most recently in charge of the Digital Transformation and Re-Engineering program; in his role as founder of the “Digital Co-Innovation Labs”, he laid the optimal foundation for today’s Digital Engineering Centers.