Digital due diligence - Discover the full potential of digitalization

© Marko Luhtala 2017

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Digital Due Diligence

– Discover the full potential of digitalization –

23.9.2017

MARKO LUHTALAAjantasalla Yrityspalvelut


Are your companies ready for the digital

economy?

2

YOU NEED DIGITAL DUE DILIGENCE TO KNOW:

Does the company have untapped opportunities to deliver

unique customer value with digitalization?

How can digitalization accelerate company growth and drive valuation?

Is digitalization likely to cause a disruption in the industry?

How can the company turn data into a strategic asset?

What is the company’s capability and readiness to embrace digitalization?


Investors have a clear interest

in digitalization…

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…because companies who

apply digital technologies typically:

GROW

FASTER

BUILD

A UNIQUE

ADVANTAGE

COMMAND

HIGHER

VALUATION

Building a competitive edge today without digital technology is difficult.

Tomorrow it will be impossible.


Digital DD is an integral part of any investment

process

4

Digital

Due

Diligence

IDENTIFYING NEWBUSINESS

OPPORTUNITIES

Map and prioritize untapped digital

opportunities.

Focus on delivering unique customer value,

accelerating growth and building a

competitive edge.

ASSESSING DIGITALREADINESS AND

CAPABILITIES

Evaluate implementation

readiness.

Focus on vision, leadership,

competences and technical readiness.

A forward-looking process

covering two areas


We examine the common sources of digital

business opportunities

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MAKE YOUR PRODUCTS AND SERVICES SMARTER

APPLY NEW DIGITAL BUSINESS MODELS

1 2

SCALE YOUR SALES AND OPERATIONS

3TURN DATA INTO A STRATEGIC ASSET

4


Digitalization has a huge impact on

the investment case

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Innovative companies generate total shareholder

return premiums of

7.5 percent over their industry peers

Source: BCG

Recurring revenue is worth 3–4x as much as one-time

revenue in company valuation

Source: High tech industry statistics

Digitalized processes deliver

10x to 100x efficiency gains compared to the

current processes

Source: Own experience based on several cases

Creation and use of unique stocks of data capital

correlates with 7x faster productivity growth

compared to the industry average

Source: OECD survey on manufacturing and service industries


A company’s readiness for digitalization depends

on 4 areas

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Clear and attractive

Realistic roadmap

Vision for the digital

economy?

Companyculture?

Digital experience

Understanding digital tasks and

roles

Network of digitally

savvy partners

Availability and quality of data

Status of backend systems

e.g. ERP, CRM

Size of the ICT team and investments

Competences?ICT

infrastructure?

Invests in what’s new

Encourages trial and error

Agile and fact-based decision

making


Digital Due Diligence is

a clear process

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BASED ON DIGITAL

DUE DILIGENCE

Amend the investment business case

Embed digitalization into the growth strategy

Build a digitalization roadmap

Appoint required skills in the board and management

Total duration: 2–3 weeks

Set targets with the investor team

Due Diligence:

• 1-2 workshops• Interviews

• Self-assessment

Validate opportunities with

customersReport and

recommendations


Recommendations

for investors

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1

ONE STRATEGY

Include digitalization in the strategies at the investment phase or when

rebuilding the growth plans – don’t make it a separate

exercise.

2

PRIORITIZE

Compare the digital opportunities against the execution

challenges.

3

QUICK WINS

Identify quick wins that deliver fast returns and get you on the learning

curve.

4

COMMON ASSETS

Consider buildingcommon digital assets and

competences for your company portfolio to

accelerate implementation.



Marko Luhtala – your digital expert

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MARKO LUHTALA has almost 20 years

of experience in digitalization in several industries ranging from

retail and consumer electronics to construction and agriculture.

He has a rare background combining international corporate

executive experience and technology entrepreneurship.

As an international sales and marketing executive Marko has

applied digitalization extensively in his own business

operations globally. Later, as a SaaS and digital marketing

entrepreneur he has developed digitalization solutions

successfully for dozens of client companies.



ADVISOR, CONSULTANT

[email protected]

+358-50-3879903

www.ajantasalla.fi

MARKO LUHTALA

I HELP COMPANIES WIN IN THE DIGITAL

ECONOMY

Leadership & Management

Digital due diligence - Discover the full potential of digitalization