Hicham Abdessamad, President & CEO, Hitachi Consulting
Hicham Abdessamad describes how Hitachi uses co-creation techniques to ensure all Social Innovation stakeholders are engaged in creating sustainable solutions.
Read the transcript of Hicham Abdessamad’s interview on Hitachi’s approach to using co-creation in Social Innovation.Show transcript
The other thing we do is, we talk a lot about co-creation. So we can’t do it ourselves. So typically when we come across a challenge, or usually it’s a client or a partner that wants to work with us, we don’t claim to have all the answers. And we also know that this is not just about technology. Technology is not necessarily the answer to a problem. It’s a solution, and it’s about the level of co-creation or collaboration.
So we talk about, hey, let’s leverage all your knowledge, your challenges, your data. We’ll bring our expertise. We’ll invest. We have some innovation that we obviously draw, because it’s core to our DNA. Let’s work together in a sort of a collaborative environment.
And we have a methodology. We call it an experience, where we actually come together and sort of prototype what could one of those potential solutions be and develop it together. And then after that we deliver the outcome, and then we hope that we can take that solution and take it to other industries or take it to other clients, or customers, or partners that have similar problems.
Hitachi comes in with capabilities. There’s typically another partner that has some capability that we’re lacking. And so we come together. And we created these centres, we call them Centre for Social Innovation. So these are hubs of innovation.
There’s one in London, actually. It’s the first one outside of Japan. We have one in the US. We have a few in Asia.
So it’s a place where you come and basically brainstorm. And we bring our engineers. Everybody comes to the table and starts to think about how do we solve this problem. Obviously, there’s a commercial side of this that’s very relevant. But certainly bringing everybody to the table and just being humble about it, and figuring out how do we solve this problem together.
And we tend to engage in opportunities where we can have replication, where we can actually duplicate it many times, because that gives us more value. So if we get involved in an energy issue, we like it to be an issue that’s happening around the world in many places so we can leverage that knowledge, and we can rinse and repeat across other industries.
We call it “nexperience”, so it’s like the next experience. And our customers really like that, because they said, hey, you’re not here to sell me technologies or products, or pitch me some sort of strategy. You’re here to solve a problem, and you’re also respecting the fact that we know a lot about our business.
They know a lot about their business and we want to leverage their knowledge, coupled with ours, and then usually involve another partner that’s got some capability to kind of make it all come together. And we’ve had a lot of success doing so, and it’s been very well received. It’s kind of a new way of addressing challenges and solutions– working with vendors and technology companies.
Anna Delaney (interviewer)
Let’s talk about the different types of innovation that you’re involved with: architectural, disruptive, radical. Can you talk more about those?
Yes. So actually we have three types of innovations that we do. One is more sustained in what we have. You already have a product, or software, or some capability that you just continue to sustain and improve. So that’s one.
Then we have sort of innovation that looks out near-term, like two to three years out. And then we have engineers that are working on things that are about 15 years out. And then we have people that are working on science projects that we would never see in the market. But we like that aspect, because usually it starts with an idea that eventually can turn into something, or not. But it’s a good place for us to learn and to iterate through that.
So these are the various types of innovations. Obviously, what we sustain is what’s commercially ready, that we sell in the market and deliver through solutions. And then, of course, everybody’s interested in what’s the next thing going to be. What is Hitachi working on? What is everybody else working on? And it’s typically the next trend.
And then there’s the old stuff that’s– not old, but sort of much further out. You don’t even have a business case or practical use yet, but you do know it’s core technology that eventually will be leveraged somehow. And I think that’s been sort of true if we look at our robotics and what we’re doing around artificial intelligence.
You know, five, 10 years ago, nobody knew how that will actually be embedded in some actual use cases that people can use everyday that could make a difference. But now we’re starting to see it becoming more and more mainstream. Everybody is talking about AI and how AI can change things. So that’s an example of radical innovation that’s kind of more forward-looking that could be leveraged now, and that’s ready for prime time today.
And how can these ideas for social innovations be generated? Do you have a specialist in your organisation, or do you work with the end consumer?
It’s actually both. So people come in with ideas all the time. So one of the things that you’ve alluded to is– one of the dangerous things is a lack of focus because you try to do too much. And you listen to ideas– you know, we have great people, smart, that they come up with things every day. And you have to put your business hat on, and the practical hat on, and say OK how are you going to– because we’re a publicly traded company.
We have shareholders. We have dividends we have to pay, and we have limited R&D resources. Where do you spend your money that’s going to drive the best value? So prioritising things are important.
So something that’s cool, it’s a great idea, may not necessarily be a good business idea, or may not necessarily drive the business outcome or the social outcome that we want. So we brainstorm, people come up with stuff, sometimes we deliberately let people work on things to see how they– sort of a startup mentality.
It’s all in-house?
Yeah, in-house. So we say, OK, go figure that out. You have a runway of 12 months to figure that out. And then if it’s commercially viable, then we put more behind it. But if it’s not– so we don’t really go and put so much money on an idea, and hopefully it’s going to stick. Our best success has been through working with clients.
They’re the ones with the best ideas, because they had the problems. So when you have a client that’s got an issue, and they’ve tried it, and they brought you in, whatever you produce and you deliver, you already have someone who is ready to consume and it gives you market validation immediately. And then you can start to find other clients with the same challenges.
So we tend to be what we call market in versus product out, or market out. Market in means, get your ideas from the market. Listen to your customers. See where the challenges are and try to solve them. Those work a lot better than trying to think of something in the lab, and then ship it out, and hopefully that people are going to potentially use it. I think that that paradigm is really shifting towards more of a market in approach versus a product out approach.
Can you just take me further, though, on that journey from the ideas stage to actually measuring the impact? What’s the process?
So the idea is, basically, if you’re talking about a customer-driven idea, it’s we have consultants around the world. We have people that talk to our clients, and they listen to what they want. We have people that want– automation is a big deal right now. Automation in the data Centre. Automate anything you can, and to further extent you can.
So you can pick an area around automation, and you say, all right, what are you trying to automate? We go back to our chest and say, OK, is there any capabilities we already have? It may not be directly, but is there any animation capabilities we have?
Or let’s say you’re in a manufacturing facility. And we have hundreds and hundreds of manufacturing plants around the world. We’ve digitised quite a bit of them because we’ve done this on our own. So the idea starts there, where they have a problem.
OK, my problem is that I have a supply chain issue. I don’t know when things fail. When they do fail, everything falls out of production. It takes me days to figure out what the problem is, and then typically days to procure all the parts. It’s a simple problem around a manufacturing facility, but that has a business impact.
We sit down and go through that whole– so we invite them either to our CSI where we are or go to them. We bring some data scientists, some engineers, and we just sit down and we talk and we brainstorm. And we call that an experience. Then we go back and build a– we do what we call a point of value or proof of concept, depends on the situation.
A proof of value meaning, we’re going to show you the value that we can generate before you engage. Or proof of concept, that sounds good. Let’s build the prototype for it. Because solving it, you have to solve it at scale. So you can solve it for a particular area, but if you can’t do it in the scaled– if you can’t do it for the whole plant. And operationally also you have to go through an element of change management to implement a new technology into an environment.
Because technology, sometimes it’s ready but the people are not– the processes are not. So we do a small proof of concept. If that works, then we roll it out in a very careful manner based on what the customer wants. And they’re like, OK, come and do this area of my business, or my manufacturing floor. We do that. You got to go through that for months to show the value, and it works, and you start to roll it out.
Then after that what we do is we say, great, this is a good solution that we developed. Let’s not reinvent the wheel next time. We’re going to take that and we’re going to basically productize it, for lack of a better term. But it’s really building an application that does predictive maintenance for these types of machines.
And then now the next client that comes along, we already have 60% of it already done because we’ve done it on a different asset. So now we’re not reinventing the wheel. So we’re shortening that cycle. And we say, hey, we’ve done it here. We don’t have to do a proof of concept. We’ve already done it. We can do it pretty quickly.
So we go through that process. So we build that into our products. So there’s this iterative process always. It’s a cycle. Take an idea, make it into a solution, build a prototype, deliver the outcome, try to productize it so you can drive repeatability. And then you go. So if we do that hundreds of times across multiple industries, you become scalable and very agile, and that’s how you drive success.
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