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Verena Fulde

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Everything new? Deutsche Telekom & OTTO in the "digital (r)evolution"

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Stefan Kohn (left), Katy Roewer

Katy Roewer, Member of the Management Board for Service at OTTO, and Stefan Kohn, Head of Telekom Design Gallery; Felix Schlereth, Innovation Analyst at Trendone (left).

Take an active role in shaping the digital future!

How do long-established industry giants have to transform to continue their success in the age of digitalization? This existential question was asked at OTTO headquarters in Hamburg as part of a talk organized by the Digital Responsibility initiative. Answers were provided by Katy Roewer, Member of the Management Board for Service at OTTO; Dr. Stefan Kohn, Head of Telekom Design Gallery; Felix Schlereth, Innovation Analyst at Trendone; Irene Heshmati, Head of Future Work at OTTO; and moderator Jürgen Bock, Head of Corporate Culture and Corporate Values at OTTO.

After 68 years, OTTO is discontinuing its flagship, the OTTO mail-order catalog, this year. The future of online retail is digital. This disruptive change to the company's business model is a milestone for many long-time customers and employees. "The decision to produce the last catalog this year was a magic moment, one that was equally liberating and nostalgic, because the catalog is a symbol of our history that was a mainstay in many households – like the legendary green phone from Deutsche Telekom," says Katy Roewer. Deutsche Telekom is also transforming in the face of digitalization: from an analog network to an IP-based one; from green rotary-dial phone and phone booths to connected tablecloths, wallpapers, and more – which the talk attendees could try out on-site. 

Digitalization and you

The digitalization of everythin is only the start. "Everything that can be connected will be connected in the future," says Stefan Kohn. Automation and the development of artificial intelligence are the next logical steps in the digital transformation, he explains. Scientists and experts have differing opinions about the impact this will have on the workplace. By contrast, the panel members agreed that the new, digitalized workplace will not only require flexibility and new skills of employees, but also a new attitude. "Against this background, the challenging task that managers face is to allay the uncertainty and fears of employees and promote an open culture of trust – in a process that we don't know in detail ourselves," explains Katy Roewer. That's why the digital transformation must be accompanied by a cultural transformation if we are to succeed in making people feel secure. Otto is promoting this transformation, for example, by launching new, open-plan workplaces and a first-name policy (i.e., using the informal "Du" form of address " in German rather than the formal "Sie") in which all employees interact with one another on equal footing. 

Trust is a competitive advantage 

And what about the company's success? In digitalized retail, global giants like Amazon are dictating the business. In telecommunications, companies like WhatsApp and Skype dominate. So has the die already been cast when it comes to digitalization? Are the winners already clear? “No. I believe that long-established companies like us, whose history is longer than just ten years, have a good chance of standing up to the competition," says Stefan Kohn. For more about this, read the guest contribution by Stefan Kohn (German only). Traditional companies like Otto and Deutsche Telekom have good chances of standing up to the competition, too: In addition to good products, they also give their customers analog values like trust and security. These values are the key to surviving the digital (r)evolution. After all, customers want to know who they are dealing with – a person or a bot. Artificial intelligence demands transparency – that was the unanimous opinion of the panel members. That's why Deutsche Telekom has developed guidelines for artificial intelligence

Digitalization means collaboration

"We have to work closer together in Europe, to compensate for obstacles such as market size and different legal frameworks," says Stefan Kohn. Digitalization means collaboration: data and people join together. And even companies like Otto and Deutsche Telekom, which both face similar challenges. After all, the two companies have much more in common than it seems at first glance: both are giants in their industry sectors. Both have a long tradition and the courage to help shape the transformation of digitalization: from a catalog-based mail-order company to an online platform that generates 95 percent of its revenues in the digital domain. From a government agency to Europe's leading telecommunications company.
The panel discussion is part of the "Digital Responsibility" initiative. Deutsche Telekom launched this initiative in early 2016 to spark a debate on the risks and opportunities offered by digitalization. For more information, visit Digital Responsibility.

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