Mikhail Nasibulin on incentives and barriers to digitalization in our country

Today, digital transformation is one of the main factors of economic growth. Businesses that can adopt agile work patterns and adapt to change have more room to grow than ever

Russian companies have a unique chance to realize their potential during the digital revolution and take their rightful place among the key players in the global market. Despite the presence of objective constraining factors, companies are transforming, and the state is developing new support mechanisms.

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Mikhail Nasibulin Since May 2019, he has been the head of the Department for Coordinating and Implementing Digital Economy Projects of the Ministry of Communications and Mass Media of our country. He is in charge of issues related to the coordination of the national program “Digital Economy of the Russian Federation”, as well as the implementation of the federal project “Digital Technologies”. On the part of the ministry, he is responsible for the implementation of the national strategy for the development of artificial intelligence for the period up to 2030.

Nasibulin has extensive experience in developing new technologies and start-ups. From 2015 to 2017, he held the position of Deputy Director of the educational program of AFK Sistema. In this position, he led the development and implementation of a strategy to create a talent pool for science-intensive and high-tech public and private companies. Developed a methodology for the project approach in the education of engineers together with development institutions (ANO Agency for Strategic Initiatives, National Technology Initiative, RVC JSC, Internet Initiatives Development Fund, Ministry of Industry and Trade, etc.), leading technical universities and business (AFK Sistema , Intel, R-Pharm, etc.) in a wide range of specializations. In 2018, he became the head of the incubation programs of the Skolkovo Foundation, from where he moved to work at the Ministry of Telecom and Mass Communications.

What is digital transformation?

In general, digital transformation is a significant restructuring of the business model of an organization using new digital technologies. It leads to a fundamental rethinking of the current structure and changes in all processes, allows you to create new formats in working with partners, such as consortiums, as well as adapt products and services to the needs of a particular client. The result should be the achievement by companies of key results of economic efficiency, optimization of business costs and improving the quality of the service provided or the product being produced.

And there are such successful cases of digital transformation of companies in the world. Thus, the industrial conglomerate Safran SA, as part of the initiative to create a “factory of the future”, launched a new ecosystem that includes technological and personnel changes. On the one hand, it contributed to the development of digital production lines, and on the other hand, it qualitatively changed the role of shop workers, who, with the help of advanced technologies, became operators of autonomously flexible production modules.

Or, for example, consider the manufacturer of agricultural machinery John Deer. In order to optimize maintenance and increase yields, the company has gradually moved to a digital intelligent tractor model with an open service application platform (with the integration of Internet of things, GPS, telematics, big data analysis).

What are the incentives for the development of digital technologies?

In developed countries, manufacturing companies have a high level of implementation of modern digital technologies, in this they are still ahead of domestic companies. One of the reasons – the lack of a clear strategic vision of digital transformation and change management mechanisms in a number of Russian enterprises. We can also note the low level of automation of production processes and administrative functions (finance and accounting, procurement, personnel). For example, in 40% of companies, processes are not automated.

However, this is also an incentive for a significant increase in indicators. According to an expert survey, manufacturing companies show a high interest in the topic of digital transformation.

Thus, 96% of companies in the next 3-5 years plan to change the current business model as a result of the introduction of digital technologies, a third of companies have already launched organizational changes, almost 20% are already implementing pilot projects.

For example, the KamAZ has already launched a digital transformation program that provides for a digital and continuous process chain from the development phase to the after-sales service phase under life cycle contracts. This makes it possible to produce new models of premium trucks, which are not inferior in terms of characteristics to the products of foreign competitors.

Sibur implements the concept of “digital factory”, which provides for the digitalization of production and logistics processes. The company is implementing advanced analytics for predictive maintenance of equipment, digital twins in railway logistics to optimize the transportation process, as well as machine vision systems and unmanned aerial vehicles for monitoring production and conducting technical inspections. Ultimately, this will allow the company to reduce costs and reduce industrial safety risks.

“Mail to our country” as part of the transition from a traditional postal operator to a postal logistics company with IT competencies, has already launched its own digital big data analytics platform for fleet management. Moreover, the company is developing an ecosystem of services in the e-commerce market: from automating sorting centers to financial and courier services that make life easier for customers.

Other large corporations also have successful digital transformation projects, for example, Russian Railways, Rosatom, Rosseti, Gazprom Neft.

The massive transition to remote work due to the spread of coronavirus infection can also become an impetus for more active digitalization of Russian companies. The possibility of uninterrupted and high-quality support of key business processes in the digital environment turns into a competitive advantage.

How to overcome barriers to digitalization?

The leaders of Russian companies consider the lack of technological competencies, the lack of knowledge about technologies and suppliers, as well as the lack of financial resources to be the main deterrents to digital transformation.

Despite this, some companies are already successfully breaking through existing barriers: experimenting with new digital technologies to improve the efficiency of current business models, collecting significant amounts of data needed to deploy digital services, initiating organizational changes, including the creation of specialized divisions within companies to increase the level of corporate technological competencies, as well as, together with specialized scientific and educational institutions, launch practice-oriented programs for personnel training.

Here it is important to take into account the quality planning of business needs and the assessment of the effects of the implemented solutions in the process of digital transformation of the company, as well as to ensure the high speed of project implementation, which is a determining factor in a competitive market.

By the way, in foreign practice, the focus on changing the business model, the creation of a competence center under the leadership of the CDTO (head of digital transformation) and the stimulation of complex transformations in key business units have become key factors in the success of digital transformation.

From the state, manufacturing companies expect, first of all, support for the implementation of technological solutions, as well as the formation of specialized educational programs and the development of an innovative ecosystem and technological entrepreneurship. Therefore, the task of the state is to create a base for providing support in the development of digital technologies and their comprehensive implementation in the real sector of the economy. The Digital Economy national program includes a number of state support measures for projects aimed at the formation and implementation of end-to-end digital technologies.

In addition, the Ministry of Telecom and Mass Communications has prepared Methodological Recommendations for the Development of Digital Transformation Strategies for State Corporations and Companies with State Participation. They contain a number of basic suggestions and guidelines to help put into practice the most effective approaches and methods.

I am sure that the measures implemented by the state will help increase the interest and involvement of business and society in digital transformation processes and will allow us to quickly adapt to modern requirements in the Russian and global markets.

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