26. July 2019

Wind of Change

sbb wind of change

How a differentiated cloud strategy is supporting the digital transformation of SBB.

The world changes fast and so do we. So, like most businesses, SBB is focusing on digital transformation. As CIO for SBB, it is important to me that we don’t see this development as an imperative that prescribes how we should reposition our business in order to deal with the widely cited uncertainties we face. It is better, in my view, to recognize and seize the opportunities it presents. Because this is the only way we can play an active role in shaping this transformation instead of getting trapped in reactive mode, making permanent adjustments. 

At SBB we identified digitalization as a phenomenon in 2014. It quickly became clear to us that this was not hype, but in fact a complete, far‑reaching transformation with enormous potential. Internally, we often use the image of a wave towering over us. What should we do? Wait and see, dive into it, jump onto it? We decided back then to learn to surf, to leap onto the wave and ride it, and that’s why our heads are above water today and we have a say in where the journey takes us.

 

Digitalization cannot be fragmented

At SBB we have taken a holistic approach to digital transformation from the start, addressing it in our corporate strat­egy. We saw – and continue to see – potential at four levels: improved customer interactions, increased railway network capacity, increased internal efficiency and new business models. To ensure we are systematic as we take advantage of the opportunities, we orchestrate and steer digitalization centrally across the group. We are currently about to take the next big step forward in our digital transformation. Having tackled cultural issues through Agile transformations over recent years and evolved a new understanding of collaboration – an Agile mindset – in IT and beyond, we are following up on an organizational level and developing a new IT operating model. The guiding question is supposedly a simple one: How will we provide IT to the railways in the future? But this in­volves nothing less than a redesign of how everyone involved with digitalization works together, from the ground up. We want to move away from a small‑scale view of projects toward a more holistic perspective and collective responsibility for their impact on cus­tomers and users. Because digitalization cannot be fragmented.

 

Moving toward an adaptive organization

In order to respond better to high market dynamism and deliver our digital products more quickly and flexibly, as well as provide greater value, we are making our entire value chain structure more market-oriented. This means it is built from the outside in and focuses on the most important task at any given moment. Teams form and are disbanded in response. The organization is shaped by our customers or the market. Simultaneously, the internal small‑scale view of projects and individ­ual IT applications is giving way to a more holistic, specialist, economic and technical perspective.

 

Clear with some cloud cover: The role of the cloud 

Interaction within the new organization consists primarily in service teams providing needs‑based support to product teams. This means that services have to be provided as flexibly, scal­ably and agilely as digital solutions or products require. This is where the cloud comes in: Strategy has to be geared to en­abling technology and computing services to meet the demands of a dynamic organization. So the cloud model adopted has the potential to tip the scales either way. It can support and spur on digital transformation, or it can become a millstone and cripple it.

 

From the hybrid cloud to the hybrid multi‑cloud

In recent years, the demand for cloud services (especially public cloud solutions) has increased considerably as a result of dig­italization and the cloud-first approach. The operating model implemented in our first cloud strategy is clearly running up against its limits. It can no longer meet the new demands of an adaptive organization that operates on a decentralized basis. At the same time, the public cloud market has expanded and matured significantly. 

To take advantage of this as a business, it is advisable to put together a balanced portfolio of public and private cloud services. Our 2019 – 2022 strategy update therefore shifts our focus from a hybrid cloud approach to a hybrid multi‑cloud approach. This entails integrating additional public cloud providers (public cloud first) in order to ensure that we provide the right com­bination of stable, secure and innovative XaaS and computing services at all times.

The strategy update described above means that the SBB IT 
Department is transforming from an IT operator into a cloud services integrator. We will connect internal stake­holders and cloud providers. We will orchestrate and organize the secure­ and straightforward handling of virtual private clouds and pub­lic clouds. This approach will equip us to meet the requirements of decentralized product teams. These requirements are fulfilled centrally via digital services on the basis of a self‑service approach, thereby strengthening teams’ decentralized autonomy. This, in turn, is a prerequisite if an adaptive organization is to thrive. 

 

The bottom line: Having the right cloud mix is key 

An adaptive organization can only do what it sets out to where it has flexible and scalable access to the services it needs for its products. A cloud strategy must therefore aim to supply services as flexibly and needs‑based as possible on the one hand while guaranteeing that these services are stable and secure on the other. The challenge of the digital transformation can be summed up in general terms as striking a balance between flexibility and stability. Using the cloud, and getting the right cloud mix as part of a differentiated cloud strategy, will decide how enjoyable the journey is. You can either try to head straight into a bitter wind or have the wind in your sails. 


Peter  Kummer
Peter Kummer

As CIO, Peter Kummer has headed up IT at SBB for nine years. As member of the SBB Group Management Board, he plays an active role in driving forward digitalization. He studied Business Management and Business Information Technology at the University of Bern and has four daughters.

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