Seven Pain Points for the Fuckup Session

Nice innovation at the Handelsblatt IT Conference 2020 in Munich: For the first time, CIOs are withdrawing to the séparée to talk about the difficulties of digitization (fuckup session). Journalists unwanted. However: In the discussions with some speakers at the conference it becomes clear what should be discussed.*


  1. Markus Voss, CIO & COO, DHL Supply Chain, Deutsche Post DHL

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Markus sees his industry at the beginning of digitalization – behind media, banking, and even behind insurance. DHL Supply Chain is a division of DHL with 140,000 employees at 2,000 locations worldwide. Every year DHL hires 40,000 new employees here. “You have to take them with you,” says Voss about his sporty employees: “Some of them make 80000 steps every day in the warehouse.”

DHL has read that from heat maps in the warehouse. Artificial Intelligence (AI) now optimizes the routing. AI also helps with “Volume Prediction”, “Staff Scheduling”, “Product Classification” and “Geocoding”. Markus´concern: The people who have been dispatchers for 20 years could quickly feel that AI has thrown them off course. The first topic in the fuckup session is therefore: What to do when employees feel that digitalization is making them redundant?


  1. Olaf Frank, Head of Business Technology, Munich Re

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CIOmover Olaf does not understand the foil of the previous speaker, on which insurances already stand as “very digitalized”, more digitalized than the logisticians. Olaf reports on a conversation with the founders of “They have already founded several companies. Then they looked at where there is little digitalization and where there is a lot to earn. That’s how they ended up in the insurance industry.”

Munich Re nevertheless offers a platform where primary insurers can participate to some extent in Munich Re’s “Sales Analytics” or “Claims Analytics”. Example: After a hurricane, an AI system examines satellite images of the affected region. It identifies where the roof is actually missing and where claims are justified – faster than any human expert. And cheaper. Olaf estimates that only 60 percent of all income is paid out by conventional insurance companies to injured parties. This could change dramatically with digitalization. So the second topic in the fuckup session is: What to do if competitors offer better conditions through digitalization?


  1. Roland Schuetz, Lufthansa Group CIO

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Roland, CIOmover as well, tells a “Customer Journey” along 14 steps – considerably more steps than getting on and off the plane. He starts with booking. Lufthansa, as a premium brand with premium prices, does well in this step, although there are still 200 airlines in Europe, as the CIO estimates. Roland emphasizes how much better performance is behind tickets that are twice and three times as expensive.

Lufthansa has undoubtedly built excellent IT solutions, for example when it comes to rebooking passengers during strikes. Many external experts and a sophisticated API strategy have helped. Roland is self-critical, however: “We have sometimes overdone outsourcing. To become faster, you have to do more yourself again.” Bonmots on the side: “Digital Labs don’t do it” and “real innovation comes from the departments.” 3rd topic for the fuckup session: What to do when the IT department outsourced competence to manage digitization?


  1. Elke Reichart, Chief Digital Officer, TUI Group

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TUI is no longer a traditional travel merchant: The group earns only 30 percent through the brokerage of travel. 70 percent is earned by TUI´s own 150 planes, its own 400 hotels, its own 17 cruise ships and its own 1,600 travel agencies. With this turning away from the digital, the question arises: Why does TUI need a CDO? Elke´s answer: Someone has to manage the 60 billion search queries per year that are made by travel-mad Germans in particular. They prefer to do this now, between mid-December and mid-February, when customers put together their summer holidays from 400 million possible product combinations. “We have an extremely seasonal business,” says the CDO: “On top of that, there are fluctuations caused by volcanic eruptions and political unrest.”

As a consequence, TUI will close all its own data centres by 2023 and move completely into the cloud. 100 percent of the developers are trained on AWS. Flexibility is increasing. “For the Monday after Thomas Cook’s bankruptcy announcement, we booked five times the capacity at AWS,” says Elke: “In some cases, there were then six times as many search queries.” The booking took three hours. TUI could have shut down just as quickly if Thomas Cook hadn’t gone bankrupt after all. For Elke, who herself had worked on the side of the providers for a long time, remains a stale aftertaste: How do you get away when things aren’t so nice at AWS? 4th topic for the fuckup session: What to do if the cloud leads to a vendor lock-in?


  1. Markus Sontheimer, CIO/CDO, Member of the Board of Management, Schenker AG

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Markus has a horror vision: Online middlemen! That’s why the CDO has developed a digitization strategy, which has already been approved by the board of directors of Deutsche Bahn. There is a core element in it: “We don’t want a in logistics”, emphasises Sontheimer: “Price machines are the last thing we need.”

DB Schenker has so far fought off middlemen in logistics quite well. Customers can book containers online – almost like a car trip with Uber. No start-up has been able to squeeze in as an “e-forwarder” between logistics provider and customer. “They haven’t been able to do that because they lack the data,” says Markus. For the same reason, however, DB Schenker has not been able to establish a digital marketplace. Competitors like Panalpina or Kuehne&Nagel have the same fear of middlemen. No logistician wants to feel the pressure of hotels under the heel of Or the pressure of the small freight forwarders to whom the big logistics companies tell where (and for how much) they should drive their trucks. 5th topic for the fuckup session: What to do when online price machines intervene as intermediaries?


  1. Kian Mossanen, Group CIO, Draexlmaier Group

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Draexlmaier builds cable harnesses for cars – for expensive cars. Draexlmaier cables are used in more than 100 premium models, so the company hasn’t felt the effects of any crisis yet. On the contrary: Draexlmaier had the best business year in its history in 2019. Luxury cars are going great and even require new factories. And anyone who builds a factory today builds it digitally. Everything is going great at Draexlmaier, says Kian, a CIOmover of 2018.

In the Q&A a question came up from the audience: Who actually owns the data that flits through the wiring harnesses of the cars? Good luck, Kian does not have to answer this question. He is leaving Draexlmaier for a new job soon. According to European case law, the data naturally belong to the customer. Drivers have so far assigned this right without resistance to manufacturers, their workshops or their suppliers. This could change, however, due to the legions of lawyers who smell business through the General Data Protection Regulation (GDPR). 6th topic for the fuckup session: What to do if the customer refuses to use the data?


  1. Christian Eigler, Corporate CIO, Continental AG

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Christian believes that innovations are going well at Conti. Only now they no longer come from the IT department as often as they could actually do. He doesn’t say that, but it’s obvious: Conti is giving itself a new holding structure with the three business units Automotive, Rubber and Powertrain. The latter is to be spruced up, so that an IPO would be possible. For Christian, this means that all the IT systems that he has lovingly patched together in recent years will now have to be torn apart again. This means that all IT capacities are tied up for homework. There will be little room for digital innovation. For the time being, all the innovative forces in IT are busy tearing apart SAP systems. Hence the 7th topic for the fuckup session: What to do when the management keeps the IT department busy with the basics of IT instead of digitization?


Michael Kollig, CIO at Airbus Canada, was the moderator of the fuckup session. Of course, he won’t say what his peers there discussed. Kollig still feels connected to the German CIO scene, even though he is constantly flying back and forth between Toulouse and Mirabel in the Canadian province of Quebec. Regarding the seven Painpoints of digitalization, he says.


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What to do when employees feel they are becoming redundant?

Michael Kollig: No problem at all right now. Our workforce has grown over the last 2-3 years. The order books are filled for eight years. We are even opening a new plant in Alabama – also to be prepared for new ideas of the current US administration.

What to do if competitors offer better conditions through digitisation?

Especially not a problem: With the A220 we have one of the youngest aircraft in civil aviation. The processes in production have been fully digitized. Further automation towards autonomous flying is feasible, but requires intensive dialogue with the regulatory authorities and probably even more so with passengers.

What to do if the IT department no longer has its own competence to manage digitisation?

We have never been particularly keen on outsourcing. Where should we go there? The aircraft industry is so special, especially in its core areas of development and technology, that no service provider can provide the necessary know-how.

What to do if the cloud leads to a vendor lock-in?

This is a constant problem. Especially now that we are moving away from the Bombardier systems and towards Airbus. Fortunately, vendor lock-in in the cloud is no longer as big a problem as it used to be in outsourcing. Still, it’s not to be underestimated.

What to do when online pricing machines act as intermediaries?

This is a B2C problem, not ours.

What to do if the customer refuses to use the data?

This is a huge issue. Of course we can only optimise where we have the data from all parties involved. But here the other players in the value chain, such as Lufthansa Technik, play a major role. As the largest maintenance company, they have their own ideas about who should use which data.

What to do when the management keeps the IT department busy with the basics of IT instead of digitization?

At Airbus, the CIO actually reports to a CDO, but I can assure you that for our CIO Luc Hennekens, IT caretaker activities are not among his top 10.

Kollig himself gave a lecture at the Handelsblatt conference entitled: “Digitalisation, and then?”. He asks about the new business models after processes, customer and supplier processes have been thoroughly digitalized. “So far we’re only scratching the surface,” says the CIO: “It’s all just continuing IT as we’ve always done. Kollig is looking for the business models that really make a difference. “They’re rare,” says the CIO, “but that’s where it has to go.”