The headlines we read every day are unequivocal. On the one hand, the digital paradigm is sweeping across industries. New milestones on technology usage, penetration is being crossed almost daily. On the other hand, however, the world is facing dwindling resources, severe climate change, and a new level of geopolitical strife. Critical events like ocean temperature rise, increasing air pollution and water scarcity are constant reminders. Sustainability and social responsibility are no longer just a tick in the box but must be woven into the very basics of doing business.
When we think of digital – transformation or digitalization – we often mean new technologies shaping the business and lives of people. The list changes with every year, from SMAC to AI/ML, the blockchain, IoT, AR/VR, with 3D printing, robotics, and cybersecurity thrown into the mix. The way technology innovation and adoption are fueling the transformation of the business models, processes, organization among others is well known. We talk about the benefits of digital adoption which we help our customers to achieve – agility, visibility, operational efficiency, faster time to market, mass personalization, customer experience, and so on.
There’s even more pressure on businesses to operate within the given constraints of the ecosystem, to do more with less, reduce complexity, simplify, and to do and make affordable and effective. Navi Radjou, innovation and leadership advisor and co-author (with Jaideep Prabhu) of “Frugal Innovation – how to do better with less,” talks about quality solutions that are cost-efficient, simple, affordable, and effective. He notes that although frugality may have arisen out of the resource constraints of emerging markets, it is now being increasingly embraced by western companies.
But do these two paradigms, digital and frugal, go hand in hand? Is the way in which companies adopt digital technologies and innovate frugal by nature? How can we do digital frugally? These are some of the questions businesses need to answer to ensure that they are sustainable in the long run and can make the lives of people in the society better.
I’ll refer to a few principles that underpin frugality as per Radjou and Prabhu and explain how our approach to digital is frugal.
First and foremost, use what is available, to create what is scarce: Capgemini has a huge resource pool, especially in Rightshore® locations such as India. So, when it comes to new technology skills, the first thing that we do is to tap into this vast base and upskill our employees to create our new digitally savvy talents. Second, Capgemini has been partnering with companies in different industries for years, delivering IT services. By virtue of that long experience with specific customers, we possess deep and extensive knowledge about our customers’ business, their IT application landscape, and their business processes. We now work with these customers to identify opportunities and propose use cases of new technologies that would be of benefit to them. We’re also going further to embed architects within ongoing deliveries in application developments and maintenance to identify problems and recommend solutions for transformation.
Engage and iterate (with customers) – in other words, engage directly with clients to propose quick solutions and proofs of concept for specific areas and then iterate over phases to incrementally build the solution and deploy it to scale. In more and more engagements, we work in an agile mode with the business. All our digital offers and initiatives are modeled with agile methodology. Take the example of our Fast Digital for Discrete Industries (FD4DI) offer, which uses SAP digital platform along with a framework to enable rapid digital transformation for manufacturing companies. We used the INNOV8 methodology as an approach to inspire organizational stakeholders, innovate new business models, and implement new and emerging digital technologies such as Industry 4.0 (the industrial internet of things, cloud, big data, and smart automation) resulting in time-to-market reduction, productivity gains, cost savings, and new revenue streams. We’re able to kickstart the digital initiatives for our customers in eight weeks with this approach. We start with digital discovery to quickly inspire and identify use cases. Then, we innovate to build a rapid prototype and demonstrate to business. We implement the concept with an MVP and pilot it. Finally, we scale this up to its full potential and deploy it across the organization.
Flex your asset –means how can we do more with less or with the same level of physical, intellectual, and human assets. Industrialization is the key focus for all the services that we deliver and we’re now going further to use the new capabilities offered by ML, RPA to automate our processes and delivery activities. Using automation, we’re able to free up the capacities of the existing team and deploy it fruitfully for customer engagements. For example, for extensions and specific developments on SAP, we’ve developed an auto code generator and auto-correction tool for taking care of code modifications required for HANA. Another example is our pre-configured industry solution for SAP for different industries – MfgPAth, EnergyPath, RetailPath, etc. We’ve harvested our deep knowledge and experience of deploying SAP solutions for companies in these industries to create solutions that are ready with the industry-specific processes configured in the system and bolstered with assets to accelerate the implementation activities. These have contributed up to 30% savings in workload and reduced implementation time from years to months.
Sustainable – this is not just CSR but changing the business model itself to reduce waste and leave less impact on the environment. Here, “Frugal Innovation” refers to a circular, sharing economy. We’ve done our part by sharing resources between projects. For example, in our industrialized Managed Services Center (iMSC) and industrialized Delivery Center (iDC), we deliver multiple ADM and AD engagements with a common, shared pool of resources. This is especially useful in situations where we’re delivering small and medium-sized projects for different customers. The team is mutualized among the projects by skill area. That enables effective utilization of resources which otherwise would have been only partially utilized. The client benefits by getting the smaller package of work done at a fraction of the cost of a fully loaded team. We’ve adopted reusability as a key measure in our practices. We systematically harvest all our engagements to sieve out reusable components, templates, and accelerators that can be used elsewhere with only a fraction of the original effort and time. We also proactively pursue reusability in the projects by making the reusable available to the project team as a part of the methodology and best practices.
Shape customer behavior – we can do only so much by ourselves, our customers need to make the journey together with us to really make an impact on the business and industry. We offer assessments and advisory services to our customers and existing accounts to diagnose their application and systems and hold a mirror up to them to reflect on. For example, when we analyze an SAP ECC system for customized programs, we often find that only a fraction of the programs is used by business users. The client IT team can see the opportunity to clean up the system and nudge the business towards a standard solution instead. We do digital maturity assessments for our customers to gauge the digital capability and how well the transformation initiative is managed. The firm’s digital maturity would be plotted in the matrix. Then the company can see where it lacks and takes steps to address that. Another example is the digital tour that we provide to the companies that we work with. We arrange workshops and tours to take the key stakeholders through what we’ve done with other customers and look at tangible digital use cases and the associated lessons learned. Thereby, the customer can envision what is possible to achieve and can initiate actions to launch the digital journey.
Co-create value with prosumers – our clients are an integral part of our value chain. They’re no longer interested in an arms-length relationship of procurement and consumption of our services, but they’re actively participating with us to ideate new ways of doing things, new solutions. In nearly all the industry sectors we operate in, there are early adopters who want to experiment, learn, and adopt new leading-edge technologies and solutions fast. For example, we conducted a hackathon with an insurance company and a bank in Europe to rapidly test the use of hyper ledger. The client collaborated with us to make early progress towards a workable solution and demonstrate what it can do and create a case for the business to invest and adopt.
Make innovative friends – innovation cannot just happen within the walls of the organization in a structured top-down manner. Rather, it’s all about tapping into the open, thriving, larger ecosystem that is brimming with ideas. We’re partnering with our technology partners, vendors, startups, universities, and colleges to create a loosely coupled conglomeration of technologies, skills, and labs where clients can join in and ideate, conceptualize, and develop new ideas and solutions for their real business problems. The Applied Innovation Exchange (AIE) is Capgemini’s global platform that leverages a framework for action, a network of exchange locations, and a high-performance engagement experience together with a broad community of designers, technologists, sector experts, business and technology partners, academics, research organizations, and startups to enable organizations to proactively plan for and respond to the various technology and business shifts that confront them on a daily basis.
It is quite clear from these principles and their application in Capgemini context that digital and frugal innovation needs to be treated as two sides of the same coin. Doing so requires a change in mindset across the organization and touches almost every aspect of how we do business. It’s a journey that we’ve undertaken to help our clients do better with new technologies while preserving the pale blue dot that we inhabit.
I think you’ll concur with me that just by pushing technology we cannot make the world a better place. We need to drive digital innovation and adoption frugally which makes things better with less. Each one of us as leaders, innovators, adopters, users have a role to play here – to deliver value for the society as a whole by using technology responsibly, frugally. After all the future of our next generation depend on us.