A revolution in innovation - the spirit of Silicon Valley comes to Europe

Mathias Calonius • Site Head, Munich / Partner

We all have the potential to find success in an increasingly digital world. Business that disrupts traditional value chains can be built in days and weeks - instead of months and years. Solutions are to be found nearby and we‘ll take them for granted soon enough.

In 2011, Marc Andreessen wrote an article called “Software is eating the world”, in which he stated that software will disrupt many new industries. Software’s impact is not limited to markets for immaterial products anymore - it will eat up the value chains of many businesses we are used to thinking of as dealing in physical products.

When software becomes an integral part of a company’s business, the operational models for different industries will start to resemble those of the software industry. Product cycles will be shorter and the need for faster decisions will increase.

Three and a half years after the article was published, we all know Uber and its business model, which is based purely on bringing together existing resources and needs. The company doesn’t own a single taxi.

John Deere, on the other hand, is a great example of how a traditional company has embraced digitality to renew its business. Their machines are outfitted with sensors and the data they provide is combined with other information, like weather data and price information. John Deere can then offer farmers resource planning services that help them optimize machine usage and farm logistics as well as make better decisions. Finnish machinery manufacturer Tana is on a similar path.

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It’s always about the people

”In the end, really it’s all about the people in the organisation.” This is how the grand old man of human-centered design, professor emeritus Don Norman put it when we met him. Don sees the fact that people spend a lot of time in meetings or waiting for meetings as a major problem at big companies.

GE offers a great example of how corporate culture can be changed. They trained a thousand managers in new ways of working and came up with a platform called FastWorks to create and develop business opportunities. It’s based on lessons outlined by Eric Ries in his book “The Lean Startup”.


Steve Blank, who is Ries’s mentor and a pioneer in the field, emphasises that despite the name, it’s actually big companies that have the most gain by embracing the Lean Startup approach.

What’s needed is a reverse pyramid, where a multidisciplinary team has the opportunity to independently drive things. In a changing world the best information is generated in continuous interaction with the clients and teams should be given a free hand to fully utilize the understanding created through this interaction.

The role of management is to enable all this - to create the operational environment and culture, clear obstacles as well as choose the right people and help them advance.

How is the best information generated?

  1. Get out of the building and meet the customer
  2. Find a problem worth solving
  3. Fail fast and iterate

Trulia’s Sami Inkinen put it pretty well at the 2014 Slush: if you solve the customer’s problems, you’ve effectively solved most of your own problems, too.

Let’s challenge the way we think

What should we do right now to move towards a desirable end result, while minimising the time and resources spent in its pursuit?

Can a product be sold before it exists? It sounds pretty counterintuitive, but actually makes a lot of sense: boldly interacting with customers will help product developers see whether customers are ready to buy the product even before investing in making it a reality.

Many of us are familiar with the file sharing service Dropbox. Its success story began with a three-minute video that outlined what the service wanted to offer its users and how it was going to do it. The video was as light and realistic an implementation of the service as possible.

70 000 people signed up for Dropbox’s waiting list and the company got financing, too. Take a look at the video and read a more detailed version of the story here. Reading the story of how Zappos got started is sure to give you some new ideas, too. Amazon later paid 1.2 billion dollars for the online shoe store.

In 2014, Futurice conducted a survey on the status of the digital transformation in Finland. 70 percent of the companies that responded had digital initiatives in their top 3 strategic projects. The greatest challenges the companies faced were the slowness of their organizations, corporate culture and difficulties in identifying digital opportunities.


Traditionally, corporate structures are optimized for success in a given market and in the present.

Success in an age of accelerated change requires that the organization is able to understand the customers’ needs and capable of meeting them quickly, with the right services and products.

Those who develop the right solutions to answer questions we aren’t even aware of yet are going to be the winners at this digital transformation thing.

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Valley picture credit: Bec_brown /
This article was originally published in the Finnish Talouselämä magazine partner blog.

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