Explains the four technologies required for DX and how to choose them | Success stories and some failures

Isn’t there a lot of people who are worried that they want to promote DX, but there are various types of technologies such as AI and IoT, and they don’t know which one to choose?

If you read this article, you will understand the technology that is suitable for your company, and you will be able to proceed with DX efficiently .

Therefore, this time, we will introduce four technologies necessary for DX, their uses, and examples of using each technology. In addition, we will introduce more practical information such as failure patterns that are common in DX and points to succeed.

What is DX?

“DX (Digital Transformation)” is a concept proposed by Eric Stolterman, a professor at Umeå University in Sweden in 2004, and refers to ” continuously evolving technology enriching people’s lives .”

Definition of DX in business

I explained the meaning of DX earlier, but here I will introduce the definition of DX in business. That is to use technologies such as AI and IoT to transform business processes, services, and management .

In other words, through the use of technology

This is the definition of DX in business.

The point is that the use of technology is only a “means” and the purpose is “transformation of products, services and business models” .

What is technology?

The word “technology” has appeared several times in the explanation of the definition of DX, but here I will explain its meaning. “Technology” is simply “science and technology”.

In other words, technology (science and technology) refers to the way in which scientific knowledge is used to make life easier.

Specific examples will be introduced in “4 technologies necessary for DX”, but smartphones are the most familiar technology in our lives. This is because the inside of a smartphone contains electric circuits and can be said to have been designed with the knowledge of science, and as a result, we can use many convenient functions such as internet connection, telephone line, and GPS. .

4 technologies necessary for DX

Isn’t there a lot of people who are worried about “I don’t know which technology to use to realize DX”?

Here, we will introduce four representative technologies among the technologies required for DX, and also explain examples of realizing DX with each application and technology.

1. AI
2. IoT
3. big data
4. RPA

①AI

“AI” is an abbreviation for “Artificial Intelligence ” .

Since AI can reproduce part of human behavior with software, it has been attracting attention for several years as a way to solve the labor shortage caused by the declining youth population.

• Usage

1. Operational efficiency

AI replaces humans in simple tasks in business, medicine, and education. If you are a company, you can improve the efficiency of your work by entrusting routine work to AI.

In the medical field, AI can reduce diagnosis time by approximately 80% by diagnosing medical conditions from CT/MRI images. AI has more data than the human brain can remember, so it can learn and diagnose various diseases.

In education, AI is useful for automating test scoring and optimizing learning for students.

2. Data analysis/prediction

AI is good at collecting, analyzing and predicting huge amounts of data. Therefore, it is useful for business management, digital marketing, etc., where it is necessary to analyze a huge amount of data.

• Examples of realizing DX with AI

1. [Operation efficiency] Mercari AI listing

Mercari’s AI listing is an example of using AI to reduce user work and improve UX (user experience). Mercari, a familiar flea market app, eliminates the need for the seller to enter product information when taking a picture of the product, and AI automatically predicts and fills in the product name, category, brand, etc.

This is revolutionary considering that until now it was necessary to check the information of the product to be listed and fill it in detail. The use of AI has made it easier for users to list items, so it continues to be used by many users today.

2. [Data analysis/prediction] Analysis of Netflix viewing trends

Netflix, a major video distribution service, utilizes “analysis and prediction of huge amounts of data”, which is one of the roles of AI, to improve the user’s service experience.

Specifically, AI learns a huge amount of data, such as the relationship between cast and audience rating, the relationship between story and exit rate, and which genres are watched the most, and uses it to create content that satisfies more users. I’m here.

②IoT

” IoT ” is an abbreviation for “Internet of Things” and refers to the “Internet of things”. Examples include remote control of air conditioners and smart speakers that play music just by speaking.

• Usage

1. Manipulate things

A typical function of IoT is the ability to remotely control things in remote locations. For example, we can grasp the status of the equipment in the factory and automatically adjust the temperature of the air conditioner if it is not appropriate.

2. Knowing the state of things and people

For example, by wearing a wearable IoT device, a person’s health condition (heart rate, breathing, blood pressure, sleep time, posture, etc.) can be recorded and observed. In addition, since it is possible to obtain user information such as service usage frequency and usage time, it will lead to product improvement and development.

• Examples of realizing DX with IoT

1. [Manipulation of things] Amazon

The warehouse of the major mail order site Amazon has introduced a system that automatically moves the shelves to the position of the worker in charge according to the order from the Internet. This system supports Amazon’s strength of ‘quick product delivery’ in order to efficiently handle a large number of orders.

2. [Knowing the state of things and people] Uber

Uber, famous for being a pioneer in taxi dispatch services, uses IoT to improve the user experience.

Specifically, we built a system where a taxi will come to your location based on your smartphone’s GPS (location information). As a result, users do not have to move to places where taxis are parked, such as in front of the station, thereby improving user convenience.

(3) Big data

” Big data ” is huge and complex data that is difficult to handle with general data management and processing software.

• Usage

1.Demand forecast

Consumption trends can be analyzed from customer data, sales data, posting data on SNS, etc., and future demand can be predicted, which is useful for developing new products.

2.Improve the quality of products and services

Sensors and other devices are attached to equipment and products to collect usage data and predict failures and when parts should be replaced. This leads to the realization of meticulous maintenance and maintenance, and improves product satisfaction.

• A case of realizing DX with big data

1. [Demand forecast] Eat chalk

“Tabechoku” operated by Vivid Garden Co., Ltd. aims to use big data to build a system that predicts income in advance. This is because the difficulty of predicting income is a major burden for agricultural business operators.

Specifically, we will introduce the agricultural IoT kit “Agri Palette” provided by Momo Co., Ltd. to farmers who are highly evaluated for “eating chalk” and acquire data on soil, air, and amount of sunlight from the field. Then, by integrating the eating chalk evaluation and the above cultivation data, we aim to build a system that can anticipate customer evaluations in advance.

If this is realized, in a few years we may be in a society where farmers can predict their income before harvesting.

2. [Quality improvement of products and services] DyDo DRINCO

Japanese soft drink maker DyDo Drinko has achieved a 1.2% increase in sales through the use of big data.

Specifically, we used to follow the Law of Z and place our flagship series, the Blend Series, in the upper left corner of the vending machine. However, when we installed eye tracking on vending machines and investigated them, we found that only vending machines focused their gaze on the bottom row.

After that, as a result of placing main products in the lower row, sales increased by 1.2% compared to the previous year.

④RPA

” RPA ” is an abbreviation for “Robotic Process Automation”, which means that a digital robot acts on a PC instead of a human.

Examples include automating invoice data entry and automating customer data collection. RPA can be expected to improve productivity by shortening work time and reducing human error.

I think there are many people who are confused with AI,

there is a clear difference.

• Usage

Operational efficiency

RPA is good at automating routine work, so it can improve business efficiency. Examples of routine work include support work such as answering phone calls and emails, and data collection and analysis work.

• Examples of realizing DX with RPA

[Operation efficiency] Don Quixote

Don Quijote Co., Ltd. has introduced RPA tools to “Don Quijote”, a well-known major discount store, and has automated about 170 operations.

An example of automated operations is matching payment information for cashless payments with cash register data. Alipay and WeChat Pay information of Chinese tourists was manually matched with cash register data, but RPA automated it, reducing all the work that had occurred several hours a day.

In addition, by automating the distribution of analysis reports for each Don Quijote store and extracting sales-related data from internal systems, the creation of reports required for business strategies is streamlined.

[DX promotion] Points for choosing technology

Clarification of DX vision

First of all, it is important to clarify “what you want to achieve with DX”, understand the characteristics of each technology, and then select the one that suits your vision . If you choose it for the reason that “AI is popular now”, there is a possibility that there will be a mismatch between your company’s “what you want to achieve with DX” and the characteristics of the technology.

For example, if you want to improve operational efficiency, choose RPA/AI, and if you want to analyze a huge amount of customer data and use it for new product development, choose AI/big data.

We recommend that you start by clarifying your vision, such as how you want to change your company’s services with DX, rather than thinking ahead with technology.

3 failure patterns that tend to occur in DX promotion

There are three failures that can occur in promoting DX.

1. Wrong organizational change
2. not a sustainable effort
3. Temporary results-oriented projects

I will explain each.

Failure (1) Wrong organizational change

When promoting DX, it will not go well just by gathering people who are familiar with technology.

It is important to utilize human resources who have the ability to think about business models and management strategies from a company-wide perspective, and to proceed with projects and identify appropriate personnel when outsourcing.

Failure (2) Not a sustainable effort

In today’s digital society, changes are drastic, and the required initiatives are constantly changing. For example, a representative change in recent years is that the need for face-to-face customer service has decreased due to the spread of coronavirus infection, and the need for online customer service and purchases has increased.

In order to improve the quality of people’s lives and make them more convenient, we must continue to create organizations and human resources that can continue to provide value while adapting quickly to change.

Failure (3) Temporary results-oriented project

In DX, it is necessary to promote the transformation of business models and the use of digital technology without being bound by the company’s policies and ideas. If you pursue DX without going outside the framework of your existing thinking in pursuit of temporary results, it will be difficult to differentiate your service from other companies’ services, and you may not be able to expect much improvement in the user experience.

Therefore, instead of using DX to achieve temporary results, it is important to change the way of thinking to “devise a strategy for improving user satisfaction → use DX to realize it.”

4 points to make DX successful

The following four points are important for promoting DX.

1. Strategic purpose setting
2. Development of DX human resources
3. Coordination between departments and expansion to the entire company
4. Don’t forget the user (consumer) perspective

I will explain each.

(1) Strategic objective formulation

In order to promote DX, it is essential to formulate strategic objectives.

This is because introducing technology without a purpose and proceeding with DX may result in a situation where the introduction did not lead to solving the problems of users (including employees of the company).

Therefore, instead of introducing technology somehow, let’s think backwards, “How can we solve current problems with digital technology and meet people’s needs?”

② Development of DX human resources

Since many engineers and management personnel are required to promote DX, it is essential to have personnel who can lead DX.

However, there is currently a shortage of DX human resources, and it is difficult to secure DX human resources from the outside. Therefore, local governments and companies will need to develop DX human resources, such as deepening the staff’s knowledge of DX.

(3) Coordination between departments and expansion to the entire company

There are some cases where the introduction of DX has ended only in some departments, and DX has not been realized for the entire company.

On the other hand, it is also true that it takes a lot of time and effort to transform a company by introducing DX. So, first of all, understand the situation of your company and work on small measures. For example, it is possible to substitute AI tools and RPA tools for unnecessary tasks in existing operations.

The key is to start small, but gradually expand. Let’s build a cross-sectional system such as cooperation between departments and aim to realize DX company-wide.

④ Do not forget the user (consumer) point of view

When promoting DX, it often happens that the user’s perspective is lacking and the emphasis is on “profit”, and the service is not used much.

Therefore, it is important to proceed while always thinking about whether DX will really benefit the end user (the person who ultimately uses the product or service).

[Must read for beginners] Recommended books for DX

From here, we recommend two books for DX beginners: ” The easiest DX textbook, aggressive IT strategy to transform your business taught by a popular lecturer ” and ” Textbook for DX human resources who create new value with digital technology “. to introduce.

DX Recommended Books ① The easiest DX textbook Aggressive IT strategy to transform the business taught by popular lecturers

The knowledge and execution steps required for DX are carefully explained from the perspective of the site.

Another point is that it explains using a wealth of diagrams so that you can promote DX on a small scale and aim to gradually transform your business processes and business models.

This is an introductory book for DX human resources, targeting everyone from DX promoters to those who are interested in cutting-edge technology.

DX recommended books ② Textbooks for DX human resources that create new value with digital technology

This is a book on the theme of DX human resources by two people from Standard Co., Ltd., which provides DX human resource development services to nearly 500 companies after interviewing more than 3,000 major Japanese companies.

45 DX cases by industry are also posted, so you can learn more specifically about DX human resources.

summary

This time, we mainly introduced four technologies necessary for DX.
After choosing the right technology for your company, use this article as a reference to promote DX in earnest!