Just Roll Up Your Sleeves and Do It
Ibrahim Kalkan is the head of the department Strategy and Organization at GELSENWASSER AG. For several years, he has kept a close watch on organizational development as it relates to digitalization. He has taken the initiative for many digitalization activities within Gelsenwasser – including in particular the topic of New Work.We spoke to him about digital transformation in the utilities sector.
Mr. Kalkan, we have spoken to many people in charge of digitalization and New Work, but never with a “Director Organization”. In the meantime, you have also assumed responsibility for strategy. This indicates a certain direction. Nevertheless, we want to start with this question: Organization and digitalization – how do those two things go together for you?
When I took charge of the department Organization several years ago, it was a traditional organization department that concerned itself with regulations and organization manuals. Now, we also focus sharply on organizational development and, very consciously, on digitalization and New Work. What makes this so exciting is that topics such as the organization manual and process management still fall within my purview, but are joined by other topics such as the planning of rooms and furnishings. This gives us exactly the right freedom for the design of many aspects.
As a consequence of our newly developed focus, my department has gradually created overlaps with strategy. We have been able to contribute to the development of a number of topics and to give them a starting push at Gelsenwasser. This is what has led to New Work and other ideas, and from them a major initiative has developed. Moreover, we are also in close collaboration with our IT department through the process and project management. In addition, I once worked in the HR department, so we were able to bring HR management on board right from the beginning. This has enabled us to drive topics forward jointly. The fact that I now have joint responsibility for the topics of strategy and organization indicates that this strategic view of organizational development was precisely the right one.
So does the way things have developed have to do with you personally? What role does the culture at Gelsenwasser also play here?
I believe that this goes back to the fact that the entire organization at Gelsenwasser is relatively small in comparison with large corporations. All of us at Gelsenwasser have the opportunity to make great contributions in many areas. Every employee – including the colleagues on my team – has a rather large degree of freedom, but this conversely leads to a responsibility to participate. To be sure, I am responsible for setting the general signposts for my team, but it is also important for me to let go of topics and for my employees to exploit their freedoms.
Could you give us a couple of examples that would illustrate your methods?
Looking back, we can naturally say that digitalization has always been part of our everyday work, e.g., in the sense of process automation and similar areas. We have completely digitalized the full scope of the planning of a building connection all the way to billing. This is not limited to only this one process, but is integrated in the direction of the related processes. Nevertheless, the IT department and I were of the opinion that digitalization is not a topic that concerns IT, but rather the business departments. So we started by structuring the topic so that it could be grasped holistically and introduced it in small packages to the business units.
At the beginning, digitalization is a rather daunting undertaking that you have to structure appropriately to your specific situation. We first made a distinction between the digitalization of the business models/products and the digitalization of the customer interfaces. Then there is the digitalization or automation of processes, and the final level is the digitalization of work methods. My personal focus was initially on the digitalization of processes and work methods. Other topics were more in the province of the business units, but in general, we all work in accordance with the motto, “Do it yourself”. We support the business units from a central perspective, but the best digitalization goes on in the business unit.
How do you organize the activities across all units? Is there something like a digitalization core team or competence team?
We have a straightforward approach. The interaction for this takes place among the experts for strategy and organization and with 2 or 3 people from IT. Within this group, we think about how we can perform as the central capacity. Our aim is to serve as the binding force that coordinates all digitalization initiatives. They should support one another and share skills and experience. We want to have a dialog and talk about what works and what doesn’t work. In addition, we are concerned with EAM, especially in the area of BI/big data, so that the required skills can be acquired here as well.
What would you say have been the greatest challenges so far for the business units when they are expected to drive digitalization themselves?
Because of their daily activities, the business units tend to focus on smaller changes. From our central perspective, we make tools and methods available that help in the development of completely innovative things. When you are involved in daily business, there is a risk that you will not see the forest for the trees. This is where we strive to give a push in other directions with the help of new technologies or the experience from other business units. One example is the way we handle data. We use data models to create transparency so that you can see what data are available and what can be done with them.
Have you set a concrete digitalization target or ambition level for yourself within the framework of this process or – and this is the impression your description gives – do you want to take small steps to make the transformation a tangible experience?
This is precisely the approach we take. We cannot say now exactly where we want to be in 5 years. At the moment, we are allowing the individual initiatives to develop. They will possibly converge at some point to form a common approach, or we will have to steer them in a certain direction if we see that the divergence is becoming too great.
Right now, it is important to us that the decentral units try out things, even that they stumble a couple of times or make mistakes. Later, we want to reach the stage when we no longer provide the impetus, but only need to intervene when steering is necessary. When we reach this point, we will have the time to think about what the digital utilities sector will look like in 10 years.
For me, the converse of this approach is that you now look at digitalization from the inside and as an opportunity rather than a response to external threats. If we now stay with the four fields that you staked out previously, we might also say this: we need new, digital products because our revenues from current business are in precipitous decline; we need a better, digital customer interface because we want to do something to secure customer loyalty; we need more process optimization because our costs are too high; we need modern work methods for Generation Y because we will otherwise not be able to find the experts we need – and so on. What role do drivers like this play for you?
I would put it like this: We see the chance to use digitalization to become better on the market. This is the driver, and this is where the pressure comes from in a certain sense – when you see opportunities, you should seize them. I would like to give an example. We are trying to combine business fields with one another by means of digitalization. Our waterworks has very high consumption of electric power. We are now trying, with the aid of forecast data, to steer the electric power consumption of the waterworks while maintaining the security of supply. This idea came up simply because we were looking closely at the topic of data. There was no urgent pressure to act here; an opportunity simply came up.
If we now try to generalize: How would you view Gelsenwasser in comparison in the energy/utilities sector? Is digitalization a topic that is right at the top of the to-do list – in the same way that intense discussion about fintechs is now going on in the insurance industry, for example?
We don’t really look so much to either the right or left. We focus on what we have and what we can do. We simply see the many and varied possibilities arising from digitalization. Parallel to this, certain changes are coming about because of regulation. The new role of the measurement point operator is a development in the direction of data-driven business models. This is also an area where we are trying to claim a position for ourselves. We will set the standards for the competing measurement point operators and offer the appropriate additional services. Until just a few years ago, there were almost no data-driven products in the energy sector. We now want to set out on this path because this is where we also see our opportunities.
That sounds now as if you had set a certain level of ambition for yourself after all.
We distinguish among our business fields. Let’s start with the water business. We see ourselves here as the standard setters and innovation drivers in the utilities sector. The situation is a little different in the electricity and natural gas business, where we regard ourselves more as an early adopter. In our philosophy of participation, we see ourselves as professional partners for the municipal utilities and want to provide them with services and offer them support in the area of digitalization as well.
You have just described yourself as an innovation driver in the water business. How would you describe your culture or innovation culture, i.e., the culture that encourages precisely this innovation?
We regularly question the things we do with the aid of an outstanding company suggestion box system. Independently of this, we are active in the innovation environment, in the research and technology environment, and in the development of technologies, and we also lead the way in certain areas. Or we participate in young companies that offer problem solutions for the water business. Perhaps you have heard about this. Intrapore is a company that solves groundwater issues by initiating very finely tuned measures to purify groundwater. When it comes to topics like this, we say we must simply work on them, we have to keep our eye on what is happening.
Cross-departmental innovation presumes collaboration within the company. How would you describe the collaboration among employees at Gelsenwasser?
We are open and honest in our dealings with one another, but we also have an open feedback culture. Our employees keep their eyes open, suggest improvements, and in this way drive innovation forward. That is what makes us special.
When people speak about innovation culture, they often mention as well the topics of a culture of mistakes, willingness to take risks, entrepreneurship, etc. Is this the same for you, and, if so, how do you practice it?
We have had a written codex in place for many years, and – even if its layout has started to look a little old-fashioned – it remains valid. This codex sets forth our fundamental principles relating to information and communication, common goals, fostering of employees, and management. Above all, it sets this maxim: Always act as if it were your own money, your own time, your own property. Everyone in our company has internalized this codex, and precisely these principles are an enormous help to us in the interpretation and shaping of modern work methods. And we constantly re-interpret this codex when we carry over long-standing fundamentals into the new world.
In the energy or utilities sector, reference is often made to the supposed or real tensions between innovations, agility, changes, doing new things on the one hand and stability, security, and critical infrastructure on the other. Depending on the perspective, this quickly turns into a major barrier to innovation. How do you talk about this at Gelsenwasser?
This is a discussion that we conduct as constructively as possible. Quite often, we do not immediately agree in the first step. In those cases where the necessity for changes simply cannot be denied, we communicate intensely with one another over a long period and repeatedly come up with new approaches to a solution. So far, this method has always made it possible for us to find a good, common path for moving forward. One simple example is the changeover to all-IP in our telephony. We always had, or have had, a telephone system at every single location. During the IP changeover, however, we wanted to have only one server location, perhaps a second one. This meant speaking very intensely with the communications employees, getting them completely on board, and then developing the topic.
Another example is the meter reading. Until just a few years ago, people went to the location and read the meters. In the meantime, we have the possibility to obtain the readings via the KSC, using a call robot, or with the online service center for our customers. In the long term, we want to be able to use radio technologies to read the meters.
That is interesting. Could you describe this in more detail? What do you do when people, for good reason, come from a particular background of experience and are initially critical of something new?
We try not to divide people into categories such as stumbling blocks and innovators, old-style and modern, but want to give everyone the chance to make a contribution to the future. Let’s take the example of an employee who will be retiring in one or two years. We don’t want to stand up when it’s time to part ways and say, “Thank you for all your committed work over so many years. You have done so much good work, but, starting tomorrow, we are going to do everything differently.” We would rather take time with this person and redesign the process during his last two years so that at his farewell we can say, “Thanks so much for your great work, especially during the last two years!” This principle makes it possible for us to question things in a completely different way.
As consultants, we always live as well in this somewhat theoretical world with all its wonderful terms such as ambidexterity, explore, exploit, and all the rest. These are all concepts that are supposed to describe how stability and change can be organized simultaneously in the company. I suspect you concern yourself less with this professional jargon and simply “make” the change.
Our slogan is “Do it”! Perhaps we do it exactly the same way – we just leave out the buzzwords. We don't know.
Let me give you another example. We have completely digitalized the full range of the building connection planning all the way to billing. This is a very traditional operational process. Until only a few years ago, it was completely based on paper. The foreman stood in front of the employees in the morning and said, “You have to work here, there, and there.” The group set out, did the work, and then asked, “What do we do now?” Today, the administrative process is completely digitalized, including the billing. The measuring is digital, the execution as well, only the actual labor in the pipe trench is not.
The digitalization extends to the crossover processes that are affected by the building connection process such as the designation of materials that will be needed on the next day and then become a part of the ordering process. We have introduced an e-warehouse solution to take care of this. We are in an area here where an extremely important and stable process must be in place because so much is dependent on it.
I would like to come back to one buzzword: New Work. Our experience – even internally in our own company – shows us that there are three dimensions here: People, Places, and Tools. There must also be a transformation of mindset and culture as well as the spatial surroundings and the IT infrastructure. What has been your experience?
We are working in exactly these areas. We are working to make sure our employees understand, interpret, and then implement the new work methods. It is important to us in doing so that the previously established work methods are appreciated and supplemented as needed. We are working at providing the right tools. At the same time, we are providing to our employees the support they require so that they can find their place in a new working world. We have here a laboratory where we model new work methods. We are starting at some points to think about workplace rotations or shared desk solutions. This also means adapting our IT so that I have my phone number wherever I happen to be. Ideally, I have my headset connected to the network and everything I need is available.
All of these topics are currently in laboratory status. We are operating a laboratory jointly with our parent companies, Stadtwerke Bochum and DEW21, and some of the employees here are working exclusively on innovation topics and innovative work methods. The team has been completely outsourced and has its own offices, even its own credit cards. We expect them to bring their experience back to the shareholders.
In addition, we have set up a special room here in the building. Employees can come here just to try things out and to take their experience back with them to their everyday work.
If you think ahead to five years from now: What would make you happiest with regard to digitalization at Gelsenwasser?
It would be fantastic if everything that has been tried out in the set box also worked in reality. Many things work in the lab, but it is a different story in reality. Sometimes it is even the interfaces that don’t work when you simply break that down to IT systems. Frequently, it is as well the combination of humans and machines. On the one hand, IT must develop more in the direction of the users; on the other hand, we are trying to make use of communication and training programs to make it easier for people to enter the digital world.
Mr. Kalkan, thank you for this detailed and highly interesting discussion!