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IT modernization in the global ecosystem

IT modernization has become a matter of fact. While years ago, upgrading equipment and updating software may have been a stepwise process that enterprises could conduct at their convenience, digital transformation is now a must. Not taking technology to its next level could mean systems fail, cybersecurity weakens, compliance falters, talent quits, and, ultimately, business stagnates – or stops.

In a digital-first era, when economic, political, and social disruptions have become the norm, IT needs to be steady. Paradoxically, that steadiness is enabled by constant evolution. And by evolution, we refer not just to replacing legacy systems. IT modernization is equally about embracing new organizational structures that make work better, finding mutually enriching innovative ways to collaborate with partners, and forging more meaningful, tailormade connections with customers.

As for our own customers, each is on a unique digital transformation journey. However, as organizations all contributing to the Netherlands’ vital infrastructure, they share common ambitions, pain points, and strategic inflection points. To hear details, we spoke with representatives from financial services CCV and Geldmaat and logistics companies NewCold, Port of Rotterdam, and PostNL.

Translating the transformation

For many organizations, one of the biggest challenges of IT modernization is not the technology itself. Their in-house IT specialists have exceptional domain knowledge and, if branching out to pursue new capabilities, they can partner with comparably skilled experts. What requires tremendous effort is translating the technological changes into organizational changes in a way that makes sense to everyone. From the top floor to the shop floor, employees need to understand the value of shifting toward decentralized IT, digital strategies, and data-driven decision-making.

“The thing that we’re concentrating on is not so much the digital part, but it’s the reason behind the need for the transformation,” said Richard Hofstede, Shared Services Manager at Geldmaat, the company whose current-day mission is making cash available nationwide via its iconic yellow ATMs. “We started out as a logistics company. So first and foremost, it was about warehouses, where to store and how to distribute. And now, all of a sudden, we’re designing customer interfaces to explain how to withdraw money from an ATM. Those are two worlds which were not even close to each other five years ago.”

After years of providing backend physical services – storing and distributing cash for ABN AMRO, ING, and Rabobank – much of Geldmaat’s attention now goes to improving frontend user experience. “Yes, that comes with digitization, which is a very interesting journey in itself. But next to that, we’re making sure that our organization understands that we are now a service-focused company, focusing on end consumers – cardholders who use our systems and are calling us now. In the past, we didn’t have a contact center or anything like that, but now we’ve got a phone number on each individual device,” Richard Hofstede elaborated. “Meanwhile, we still have people in our cash centers on a daily basis counting money. Some joined when they were 16 and are celebrating 50 years with us, so it takes a leap of imagination to understand what is happening to this organization.”

The time and thought that goes into translating a domain transformation resonated with Frits Snijder, IT Parcels & Logistics Manager at PostNL, the nearly century-old company that handles most of the Netherlands’ mail delivery. “We are now calling ourselves a software tech company within logistics. But we still have old frameworks that don’t work in a tech company. Software needs a different style of management,” he said.

Emphasizing a more holistic, less hierarchical approach to organizational decision-making, Frits Snijder relayed the kinds of questions that help bring the new frameworks into sharp relief. “We’re considering: if our board takes certain decisions, what does it mean three or four layers down for those involved teams? What impact does it have? And we're looking at always connecting the DevOps teams with the management team and the board, building from up-down and down-up. In short, how do we align business and IT?”

Although electronic payment service provider CCV hasn’t recently expanded its domain, IT modernization also brought the need to reinterpret roles and responsibilities. “We changed from being an organization with a strange governance – having a software department, a hosting department for specific services, all kinds of different departments, each responsible from some part of the whole chain – to now having production service or proposition teams,” said Jochem Somers, Transaction Processing Director at CCV. “That’s a tough journey because you have to have a discussion with everybody who was responsible for the different departments. But we’re now at a moment where it helps to talk about governance, deciding who’s responsible for what.”

Among the customers we spoke to for this article, refrigerated logistics company NewCold is the youngest, at 10, with little legacy to report on. However, new projects still require getting buy-in, as described by Gunther Cleijn, Cyber Security VP at NewCold. Of a hyperconverged infrastructure solution implemented with Schuberg Philis, he recalled: “There was a difficult discussion with the CFO. He was like, ‘Wait, you’re going to spend that amount of money on IT? What about how much we spend at the moment?’ But as Schuberg Philis colleagues and I have talked about, I knew I had to take the other person’s perspective into account when telling my story, asking myself: ‘OK how do I sell this to my CFO in a way that he understands it?’ For us in mission-critical IT, it’s common language, common practice even. But for our company, it was totally new.”

Optimizing the ecosystem amidst global dynamics

As the COVID pandemic and the war in Ukraine made unmistakably clear, IT modernization is not about any single enterprise at work. The entire ecosystem in which it operates affects, and is affected by, the digital transformation. When value chain partners have overlapping technology priorities, the ecosystem can become more resilient and mutually supportive. At the same time, the more globally interconnected and interdependent that organizations become, the more leaders can leverage the external pressures of geopolitics and international regulations to pursue smart, sustainable strategies.

Ecosystem interdependence is felt acutely by the Port of Rotterdam, the authority that manages Europe’s largest port. “We are not a company acting on its own. When the ships leave the Port of Los Angeles or China or anywhere in the world, our different parties and different digital platforms play an important role. The complete chain is relying on the availably of those within the chain,” stated Marijn van Schoote, Head of IT Operations & Services Management and CISO at Port of Rotterdam. “We can say we are as resilient as we want, we can say we are available 24/7 with an RTO of 0. However, we rely on our partners. If, for example, the pilots or the tugboats are not available due to an IT outage or a pandemic, as we saw with Corona, then parts of our process also stop.”

While Port of Rotterdam spent the last two years engaged in its own digital optimization, these days the organization is planning how to realize ever wider ambitions. “The biggest impact that we can make is not optimizing our own processes as a company of 1,200 people, but to see how we can contribute as a port authority to our ecosystem of approximately 5,000 companies,” Marijn van Schoote elaborated. “How can we open up the data processing that we’ve done to support others, sharing weather, tide, and other water information relevant for logistics companies? And how can we professionalize our data governance and data quality so companies, such as PostNL, FedEx, or KPN , can use the data to optimize their own processes?”

Finetuned awareness of its place in the ecosystem – and, within it, how crucial fellow members are – is imperative for NewCold, too. “We build our warehouses at strategic locations from which we can serve at least two major customers. We are located around the globe – Australia to America – and expanding massively,” said Gunther Cleijn, noting that the company plans to at least double the number of its warehouses, currently 13, within the next three years.

And yet, Cleijn admitted, “One element that keeps me awake is the global dynamics. The landscape dictates your strategies. We need to automate as much as possible, but in the end, we still do need people on every continent if only to ensure we comply with local legislation. I’m not familiar with Australian legislation, for instance, so I need people over there who know how it works.”

On the topic of international legislation and its impact on daily operations, our customers had varying experiences. While some find Europe’s newest series of regulations, such as the NIS2 Directive and DORA, to be a hassle sometimes, others felt it was a blessing in disguise. Among those finding them useful, Jochem Somers described how in his expanded role of overseeing not just CCV’s transaction processing but the whole chain of services it entails, compliance expectations provide a clear narrative for internal and external communication.

“For my responsibility, it helps that we are under license of the Dutch National Bank. Then you have something you can discuss with everybody from the business to say, ‘Hey, please fix this. Take necessary shortcuts,’” he said. “You can have good discussions – not that we are unwilling to discuss, but they push us to explain why. To regulators, you always have to explain decisions. Because I own this responsibility, I don’t feel it weighing on my shoulders everyday. That helps me play the role very strictly with colleagues and also have discussions with customers.”

Balancing business continuity and customer intimacy

IT modernization requires organizations to look inward, reevaluating their core business and, often, reconnecting with their core values. Yet, no matter which technology, models, or processes they adopt, a consistent objective remains business continuity. At the crux of that is the capacity to simultaneously look outward: to their own customers. This allows enterprises to keep doing what they do best while making business progress, which – particularly for our customers, delivering the world’s most essential services – is inevitably linked to the progress society can make.

“A lot of us are in logistics, so it’s really an emphasis on operational efficiency. And on the other hand, there’s the touchpoints with the customers and the consumers, and then it’s all about customer intimacy,” noted Frits Snijder. As he described it, PostNL is continuously seeking to strike a balance between being “really focused on operational efficiency in the thing you’re good at” and the “need to be more customer-intimate.”

Ensuring that operations meet consumer demands likewise incentivized CCV’s cloud migration to AWS, an undertaking which it partnered with Schuberg Philis on. “We have made promises to our customers about availability and reliability. So the motivation is there to look everyday at how we can maintain business continuity,” said Jochem Somers.

The decision, moreover, to collaborate with organizations whom the company could, essentially, “outsource worries” to was another customer-centric milestone in its digital strategy, he shared. “CCV is a family-owned business. Historically, we did everything ourselves and have our own datacenter at the office in Arnhem. Going from doing everything by yourself to doing more things with partners is a huge step.”

For Geldmaat, too, IT modernization has been motivated by the demand for resilient operations. “When it comes to public perception regarding availability of our services, that’s quite intense – specifically on a Friday afternoon. That’s peak time, when the entire Netherlands is going to the ATMs,” said Richard Hofstede. “We also need to take care of the safety of the people who are in the facility of a place which could be compromised,” he continued, in reference to a pattern of robbery attempts via ATM explosions. “There's a tremendous amount of security components to include in there, all for the purpose of leading to higher availability, of course.”

Everyday people are also the ultimate consumers of NewCold’s value chains. The company commits to its customers – large food manufacturers with products sold across multinational fast-food chains and grocery stores – so they, in turn, can keep their commitments to all their customers. In a similar spirit of connectedness, Gunther Cleijn encourages his colleagues to not only understand the innovative technology powering their company, but literally embody it. “Within their first two weeks, I take all the new employees from my team to a warehouse to experience the cold because it’s minus 30 degrees Celsius in there,” he said. “That way they actually feel the environment that we operate in.”

While its direct customers aren’t the public either, the Port of Rotterdam is a key player in multiple value chains that circumnavigate the Earth, eventually reaching recipients everywhere. And yet, “The goods can only go smoothly around the world if the complete process is running,” Marijn van Schoote emphasized, highlighting the exponential impact of business continuity and customer intimacy within a global ecosystem.

A culture of resilience

So once again, we hear how despite having distinct critical missions and serving different critical masses, our customers share a purpose. Simply, it's to make sure their services are always available and accessible. Our customers are therefore embracing IT modernization. They know the process is not primarily about the technology itself – much can be bought off the shelf or subscribed to as a service. Rather, IT modernization is about stimulating the organizational culture to grow and evolve. In supporting internal structures while nourishing and being nourished by those surrounding it, the organization becomes more resilient. And when our customers provide resilient services, their customers can go about fulfilling their own critical purposes, whether in work or life, via cash or credit, by land or sea.