Since its foundation in 1925 on the westernmost parts of Denmark, Bang & Olufsen has been an icon in Danish business. Over the years, the company has produced some of the most coveted audio solutions to ever grace everything from living- to boardrooms in Denmark and abroad, but has, like everything else, changed in time.
Today, the company is no longer just a manufacturer of audio and video solutions but has transformed into a full-fledged retail company with a distinct focus on the core competencies of design, audio and craftmanship.
Transitioning a company like Bang & Olufsen from traditional production and further into the digital fray, requires access to a wide array of advanced technologies that even the biggest tech companies are sometimes still working to get just right. The solution? Partnering up with leading tech companies in their distinct fields of expertise.
– We still deliver the same products based on the unique combination of sound, craft and design, but customers play a much bigger part of our processes today than earlier. And are involved much earlier. We follow the current trends in the market closely – and looking out at the competition, we’re a part of the forefront when it comes to adapting new technologies. But with the sudden shifts in trends and technologies that, in general, happens in retail, it’s hardly an option for us to be the experts in every nook and cranny, Jan Topp Rasmussen says.
When dealing with B2C customers, speed and time to market are of the utmost importance. Trends shift quickly, and the most coveted products one month could be old news the next.
– A rule of thumb is that we try to be ahead of the curve when it comes to offering the newest technology to our customers. But we are not, however, necessarily first movers. We need to be able to trust that the technology works. An example is speech recognition. If we had to develop the technology ourselves and put it through the proper testing and quality control, our time to market would be too long. Instead we rely on tech partners with in-depth knowledge and the capabilities to thoroughly test the technology. This also means that it is easier to scale up production and development because we don’t have to wait for inhouse innovation to develop a solution but can implement directly from our partners who solely focus on keeping up with these things.
The necessity to stay ahead of the curve means that Bang & Olufsen has taken new methods of development to hearth as well as drawing on the feedback from the end users and customers.
– At Bang & Olufsen we operate within a hybrid model in terms of development. When we’re working on something customer related it’s all about agile and innovative development and working in sprints – the focus is, as always, on quality, but just as much on speed and time to market, Jan Topp Rasmussen says and explains that the methods have also “trickled downward” into the teams themselves.
– Development isn’t something happening in a “secret” or desolate part of the company. Our projects in general are connected seamlessly together with the rest of the business – that’s why our project teams consist of coworkers from “both sides” and different departments. We try not to divide it into IT and the rest of the business.
The same user-centric approach also determines the technologies that Bang & Olufsen ultimately goes for.
The company often goes to great lengths to determine what the customers want. This sometimes means inviting, often, younger designers or artists to workshops to get their inputs to the next big trends.
– We thoroughly consider what technology to use, and from a strategic point of view we strive not to get locked into a specific technology. As part of various interesting fields and areas, we are right now looking into AI and eCommerce with the goal of delivering the best possible user experience.
Relying on external partnerships for cutting edge technical solutions doesn’t, however, mean that Bang & Olufsen will throw its chips in with anybody.
– Partnerships are an executive level decision in Bang & Olufsen and it’ll stay that way. We’re essentially inviting somebody into our inner sanctum so it’s important that they share our core values. We can’t, nor won’t, compromise on our values. At the same time, we work closely together with our external colleagues and it is important to implement a smooth corporation in a proper fashion, Jan Topp Rasmussen states.
While being a production company gone retail, Bang & Olufsen has had to reevaluate most of the processes within the company to fit a digital framework. One question that has risen in the process is whether to use existing legacy to catapult the company forward or, instead, take the clean slate Green Field approach.
– We’ve had a lot of discussions about this. Do we insist on dragging our old, but updated, legacy systems with us on the digital transformation journey, or is it a clean cut – a green field to sow something new? Jan Topp Rasmussen asks rhetorically.
He explains that the digital culture Bang & Olufsen is trying to cultivate within the company heavily draws on the green field approach when it comes to the applications and architecture in the company.
– Moving forward and creating new solutions for the benefit of the customer drives everything else, and it’s difficult to be truly innovative if you constantly depend on aging legacy systems. Thus, green field plays a big part in shaping our digital culture.
Bang & Olufsen is preparing a modernization program involving both retail and ERP as well as the company’s digital infrastructure. The program has two tracks that revolve around process excellence and security with cloud as the intended platform of operation.
To lessen the gap between IT and the rest of the business, Bang & Olufsen has implemented a Business Relation Management concept (BRM) to bridge and improve collaboration. Furthermore, business technology is used as frame instead of IT to better reflect the technological support of the entire business as a whole.
If you want transformation and change, it must be a part of the strategy for the entire company going forward. You can’t make it with just a couple of passionate employees, but need the full support of the board, management and staff.
Get your governance in place. You’re tampering with both the company’s DNA, its processes and culture, so clear lines in terms of decision making and responsibility are necessary.
Accept that digital transformation doesn’t happen overnight. Some things go fast, some slow and others are not to be disturbed – and don’t be afraid to bring in people with new and different skillsets.
This year's Expectation Barometer delves into the opportunities awaiting Danish and international companies, and their readiness to scale their digital initiatives. What differences are there? And where? And what does it require - strategically, technologically and organizationally - to scale such digital
initiatives? We call this Digital at Scale.
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