Making existing models obsolete
“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”
The term “innovation” is often used to refer to sudden changes that deliver dramatic results. The day-to-day reality for most of Itera’s customers, however, is much more a question of gradual innovation. Most revolutions appear to be evolutions when you are in the middle of them.
One of the 25 most innovative organisations in Norway
In 2016 Norway’s leading innovation news magazine, Innovasjonsmagasinet, recognised Itera as one of the 25 most innovative companies in Norway across all sectors, along with companies such as DNV GL, Norwegian, Snøhetta, Telenor, Statoil and Schibsted. We greatly value this recognition.
Four approaches to innovation
It can be said that there are four different approaches to innovation that depend on whether the context is a new or existing service and a new or existing market. Potentially disruptive innovation is located in the bottom right quadrant. This approach is the most talked-about approach, but it is in reality rarely embarked upon. Service innovation and market innovation are more common. The most common approach of all, however, is incremental innovation, which is when an existing service needs improving for a market that the service is already in. This approach involves creating results gradually using a pragmatic approach, preferably with little excitement or elaborate innovation models and programs.
Itera’s innovation methodologies
Itera has worked systematically on innovation for many years. Our customers have a constant need to develop their service and product offerings, and they need to do this quickly. We have therefore developed and refined nimble and pragmatic methodologies that are end-user-focused and that enable us to quickly move from hypotheses to services we can try out in the market. This enables weak ideas and incorrect hypotheses to be weeded out at an early stage, and this can represent significant savings in terms of time and expense relative to this taking place at a later stage in the process. Our mantra is the Agile mantra “fail fast, fail often”.
Closing the gap
In today’s disruptive environment, sourcing needs to move away from approaches that are "built to last" to sourcing strategies that are "built to adapt".
The disruptive forces that are creating a wave of digital opportunities in business have created a need for a fresh approach to sourcing. Despite this, few organisations are ready for the speed of customer-centric innovation or the myriad technology and business options that will define the next generation of business and market leaders.
Acute digital skills shortage
Europe faces a shortage of 800,000 IT workers by 2020, and this number will increase once the digital revolution impacts all industries simultaneously.
37,000 people work in IT in Norway across businesses and IT service providers, while the country’s universities and technical colleges produce about 1,000 IT graduates each year. According to IKT Norge (the interest group for the Norwegian IT industry), Norway faces a shortage of 10,000 IT workers by 2020. Norway does not on its own have the capacity to educate sufficient numbers of people to meet the fast-growing demand for IT personnel. The other Nordic countries are in the same situation.
It is consequently necessary to use outsourcing to access the labour force of other regions in order to close the skills gap.
Hybrid delivery for customer-centric innovation
The three types of outsourcing – onshoring, nearshoring and offshoring – all have specific benefits, and each option is typically associated with expertise in certain skill sets based on the training available in the geography in question. A hybrid solution involving more than one of these outsourcing options often represents the best solution for aligning a customer’s business goals and needs with those of its outsourcing provider, while minimizing costs.
Itera believes the best sourcing model is a hybrid nearshoring model that combines both onshoring and nearshoring in order to make it possible to offer the best fit for each customer’s precise needs and budget. This model corresponds with our position since it provides the greatest possible agility and speed in relation to customer-centric innovation and the myriad technology and business options that will define the digital businesses of the future.
Itera’s hybrid model offers customers outsourcing that is optimized in terms of talent and cost with just a single point of contact. An important quality when looking for a hybrid provider is that the provider ideally needs to have hybridity in its DNA – to have a strong cross-border culture based on using a single methodology and framework for managing its customers, data, processes and employees. Looking at the CVs of potential candidates is only a minor part of a successful selection process.
Built to adapt with a two-speed approach
In today’s disruptive environment, sourcing needs to move away from approaches that are "built to last" to sourcing strategies that are "built to adapt". At Itera, we have integrated our sourcing model seamlessly into our Nordic organisation.
Itera’s hybrid capabilities support a two-speed or bimodal approach in order to handle the rapid pace at which digital innovation has to progress with a controlled level of risk. Our nearshore locations are built from scratch as part of single cross-border teams on the basis of the flat organisational structures and self-starting cultures of the Nordic region, and Itera employs the same world-class agile methodology and business framework for managing its customers, data, processes and employees consistently across all locations.
EU data protection and security
Because Itera has many customers in the banking and insurance sector, we were the first Nordic vendor to implement Binding Corporate Rules (BCR). This means we are able to make intra-organisational transfers of personal data across borders in compliance with EU Data Protection Law.
We are also certified in accordance with the ISO/IEC 27001 standard, which sets out formal specifications for information security management systems. Last but not least, we engage fully with other international bodies and communities in the countries in which we are present, including with chambers of commerce, European Business Associations (EBAs) and other bodies.
Fail fast, fail often
Design sprints enable us to work in accordance with the innovation mantra of “Fail fast, fail often”.
Creating new products and services is risky and involves a lot of uncertainty. It is extremely rare to get it 100% right at the first attempt and, since time to market is an important success factor, design sprints can be an important framework.
Itera uses design sprints as a central activity at the start of the product and service development process in order to steer innovation work in the right direction in collaboration with the customer. This framework enables us to work in accordance with the innovation mantra of “Fail fast, fail often”. We start with a broad range of ideas and quickly test out whether they have the potential to solve the problem and whether they would appeal to the target group we are seeking to reach, so that we can decide which of them are worth working on further.
In addition to being an efficient approach to innovation, a design sprint creates a lot of positive energy in the team and in its relationship with customers, and this adds value to the tasks that are to be completed. Design sprints are fun and enable everyone to be involved in working on a positive challenge that also develops their skills.
Some tips for completing a successful design sprint:
- What is “the big challenge”? What problem are you trying to solve? Involve experts in order to shed light on the issue before you start.
- Set up an inter-disciplinary team
- Ensure the whole team can dedicate 100% of their time to the design sprint for its entire duration.
Itera favours completing design sprints with its customers in the course of a single week, frequently on the basis of the following agenda:
Monday – Building a shared understanding of the task
The team discusses and researches the problem area. We begin at the end – what is the overall goal? What commercial opportunity do we want to create? What will success look like?
What do we need answers to from this sprint? What do we need to confirm or disprove to be on the right track?
Tuesday – Developing ideas
We look for inspiration from good user experiences that have transferable value. Examples can be taken from both the analogue and the digital world, from competitors or from completely different industries.
We then set to work on developing ideas. Be open. At this stage, we are more concerned with quantity than quality. Create sketches and diagrams and explain. Build on each other’s ideas. Finish by voting for the best idea. It's a team decision.
Wednesday – focusing on a direction
The aim of this day is to choose the part of the service that it is the most important to prototype in order to quality-assure the idea.
Identify and draw an experience map/overall user journey based on questions such as: How does the user find your service? What will his/her first experience of the product or service be? When and how will it be used? What will the experience be? What will happen afterwards?
Use the experience map to add further details and to refine the idea so there is a good basis for creating a prototype.
Thursday – prototyping
The prototype needs to be simple, focused and testable. It can be paper-based or digital, a role play or a physical object. It does not need to be perfect, just sufficiently realistic for testing it out to be worthwhile.
Friday – user testing
We test out the product on people who are representative of the target audience. The team observes and analyses continuously. A joint summing-up discussion meeting is held to discuss the findings and patterns observed.
The design sprint ends by using what we have learnt to determine whether the idea can solve “the big challenge” and whether we need to improve the prototype, or whether we should simply discard the idea altogether.
Regardless of the outcome, the design sprint will have been an important learning experience without spending too much money or time.
A perfect storm
We will increasingly be seeing robot advisors that offer more personal and more contextual banking services that are ultimately unique to each one of us.
The finance and insurance sectors are in the middle of a perfect storm caused by a wave of new regulatory requirements, the emergence of fintech and insurtech companies, new technology and high customer expectations.
New technology and new services have already changed our everyday payment habits. For example, after just one year in the market, DNB’s Vipps mobile payment app has more than two million registered users.
Checking the account with Google?
The Payment Services Directive 2 (PSD2), which will come into force by 2018, will change banking as we know it. This new regulation will give customers the option of using third-party companies to access and manage their financial services. Will we be using Google or Apple to pay for purchases or to check our account in the near future?
The PSD2 and smart uses of new technology have enabled a whole range of new fintech and insurtech companies to emerge that are seeking to challenge the established banks and insurance companies.
Personal advice from robot advisors
New technologies that allow banks and insurance companies to offer service levels more synonymous with hospitality than with financial services and established technologies like artificial intelligence and robotic process automation mean that we will increasingly be seeing robot advisors that offer more personal and more contextual banking services that are ultimately unique to each one of us.
All these changes mean that banks and insurance companies need to rethink their business models and to adopt new technologies faster in order to build new digital services that address high user experience requirements.
A new way of thinking
Itera has over 20 years of experience of completing projects for many of the largest banks and insurance companies in Norway and the Nordic region. We have in-depth knowledge of the sector as well as the latest in design and technology and so are able to build new digital banking and insurance services. Bank and insurance companies have realised that they need to both think and act as tech companies and accordingly to have multidisciplinary expertise and to use the Lean Startup methodology and cloud services in order to build new services more quickly and more successfully. This is the backdrop against which Itera delivers its services.
In a perfect storm of change, new opportunities arise. For the industry - and for Itera.
Digitalization is change
Digitalization is more about people, processes, and organisational issues than technology itself.
Is the public sector in the process of going past its sell-by date when it comes to taking advantage of the opportunities offered by technology? According to the Norwegian Agency for Public Management and eGovernment (Difi), the situation as of 2016 is that progress on digitalization is too slow, and that there are actually some areas where it is going backwards. The public sector is not using the opportunities offered by digitalization, and is not meeting the population’s higher expectations.
In the local government sector, a lack of capacity and expertise are put forward as reasons for not making the most of digitalization. In addition, a significant amount of time and resources are being spent on maintaining old systems, which hinders modernisation work. Roger Schjerva (Chief Economist at IKT Norge) has written in an article on digital competitiveness that, according to the UN’s E-Government Survey (United Nations 2015), which compares e-government across 193 countries, Norway fell from eighth place in 2012 to thirteenth place in 2014. In digital services, Norway fell from first place in 2008 to eighteenth place in 2014, with the Norwegian public administration scoring particularly badly for more advanced services (two-way communication across sectors). In general terms, Norway’s score is pushed up by the digitalization of the tax system and the digital services for business and industry provided via Altinn, while it is dragged down by the slow pace of digitalization in the local government sector.
People and processes
The Centre for Digitization at the Norwegian Business School sees digitalization as more than using IT as a support tool. Digitalization rather involves organisations developing and adapting their organisational structures, operating models and work processes to exploit the opportunities offered by technology. Accordingly, digitalization is more about people, processes, and organisational issues than technology itself, and it is expertise in these areas that is lacking in the public sector. The issue is not helped by the fact that projects around digitalization are in practice change management projects that take a long time to implement.
Passion and commitment
At Itera, we are passionately committed to helping to digitalize the public sector with a complete focus on the users of public services – on users as citizens, employees, pupils, householders and patients. Itera’s full range of communication and technology services, in combination with its innovation methodology that features active end-user involvement, create good user experiences and quick results - this is how we are helping to digitalize the public sector, and is something that we will continue to do, to make a difference!
Ideas for the future
Itera thinks that the winners of the future will need to cultivate three specific qualities.
2016 was a year of significant change, both globally and closer to home. Trusted forecasting models failed, climate records were set, partnerships were announced that would previously have been thought impossible, established businesses disappeared and new companies won significant market share. One thing is certain, however, which is that the pace of change is increasing. The central question is whether organisations are equipped for such an unknown future. Itera thinks that the winners of the future will need to cultivate three specific qualities, regardless of the industry in which they operate:
Willingness to change: Businesses that fight to preserve the status quo will lose. Regardless. Absolutely all industries are being affected by the wave of digitalisation, old ways of doing things have to be discarded or reinvented, and new business models have to be created. Unless existing companies change, they will be outcompeted by new companies, quickly and unexpectedly. In order to address this challenge, all organisations need to develop a culture of change and flexibility. We need to move from having five-year plans and strategic visions to operating with flexible plans and quick prototypes. Linear projects need to be replaced with iterative sprints. We need to stop focusing on what is behind us and instead focus on talking about the future.
Speed: The advantages of being a first mover are often so significant that being number two is not really an option. It is becoming more and more usual for companies to launch simple solutions quickly which they then improve on a continual basis after their launch. Technology is developing exponentially and open solutions and partnerships are gaining ground, and we need to develop employees and structures that correspond with this. Artificial intelligence, algorithms and voice control will set the agenda much more over the next year than they have over the previous decade.
Closeness to customers: High user expectations in terms of relevance and pace are placing sizeable requirements on providers of services in both the public and private sectors. Competitors are always only one click away, and in order to win the battle for the customer, it is important to know what problem you are trying to solve for him or her in as much detail as possible. This requires a different and more exploratory way of working, as well as continual collaboration with customers and users. Simple prototypes need to be developed quickly and tested out in real-life situations before being either rejected or improved. Real customer journeys need to be optimised in close collaboration with users, and open collaboration models need to be introduced.
Succeeding in the future is going to be demanding. At the same time, the rewards will be sizeable. And we already have numerous examples for inspiration:
Vipps – a daring and efficient development and distribution of services against strong competition from global companies such as Google and Facebook.
Schibsted – a quick-working, international innovation machine built on gathering and using big data efficiently.
The Norwegian Defences Estates Agency – a public sector organisation that has used smart technology to revolutionise its internal processes.
Nabobil.no – an established start-up that meets a customer need by using technology effectively, while also riding the green wave.
eSmart Systems –technological innovation at the highest international level, using modern technology and methodology.
The most important task for executive management teams is ensuring the business they manage is equipped for the future. At Itera, this is a challenge we set out ourselves every day, and our motto, “Make a difference”, gives us both a mandate and a duty to do just that. In 2016, we invested significantly in our employees, systems and methods in order to address the challenges of the future. We are a partner to Fintech Factory, to Oslo Medtech and to other exciting specialist organisations. We run weekly specialist evenings, and have recently introduced our internal “game changer program”, which consists of all employees being invited to develop ideas for the future of value creation. We play an active role in specialist forums and conferences across the globe. What is of greatest importance, however, is what we learn from delivering demanding and innovative projects together with our customers; doing this is what will enable us to meet and embrace the future that we all want to be part of.
Top 25One of Norway's 25
most innovative companies across industries
Top ExecutiveItera's CEO Arne Mjøs voted Top IT executive of the year
GSA Global Awards 2016
Finalist in the European Service Provider of the Year category
The European Software Testing Awards 2016Finalist in Best Agile Project, and Best Overall Testing Project – Finance
SSON Excellence Awards 2016
Finalist in Excellence in Transformation category
20With colleagues from 20 nationalities, our diversity is unique
198928 years of digital experience
13 683Hours spent on training to secure world-class competence
5Present in 5 countries: Norway, Sweden, Denmark, Ukraine and Slovakia
Q2 - Itera moved its head office in Oslo to new, contemporary premises in Nydalen that have been completely adapted to Itera’s specifications and requirements to facilitate interdisciplinary collaboration. The expected benefits include increased employee satisfaction, a stronger corporate culture and greater efficiency.An ordinary dividend of NOK 0.15 per share was paid to the shareholders on the basis of the Group’s 2015 results.
Q3 - Itera was recognized as one of the 25 most innovative organizations in Norway across all sectors by Innovation Forum Norway. Itera entered into a large contract with Gemalto in connection with the development of a new national ID card featuring eID based on biometric technology and a new generation of Norwegian passports.
Q4 - Itera achieved revenue growth of 10% in the fourth quarter relative to the same period in 2015. An additional dividend of NOK 0.15 per share was paid.
The proportion of Itera’s capacity located nearshore (nearshore ratio) was 37%, an increase of 1 percentage point from the previous quarter.
Cash flow from operational activities was NOK 36.9 million.
425Operating revenues (MNOK)
14%Growth 10 top customers
Revenues by industry
52%Banking & Insurance
18%Public, healthcare and organisations
6%Retail and consumer products
4%Energy and marine
Our annual report shows that Itera has had a strong development in all important areas during the course of 2016.
Our strong and diversified customer portfolio makes us well qualified to understand our customers’ challenges.
CustomersIncrease market shares and loyalty through providing great user experiences, optimized customer dialouge and user orientation in developing new products and services.
Products & ServicesAdapt to customer expectations through a user centric approach, agile development, smart communication, high-end technologies and efficient methodologies for innovation.
OperationsSecure efficiency, security and compliance through digitalization of processes and optimizing infrastructure.
EmployeesCreate and retain high employee satification, encourage employee engagement and enable collaboration and mobile productivity.
Strategy & Insight
Design & Concept
System & Development
Hosting & Operations
CustomersTailored solutions and programs built to strengthen the relation between the customer and the customer's customers through active involvement and user centricity.
Products and servicesEfficient and lean processes for innovation, resulting in high quality solutions through great design, relevant content and smart technology.
OperationsSecure, optimised and compliant infrastructure, supporting optimal business support through efficient processes.
EmployeesSolutions offering agile, always-connected collaboration and working platforms, enabling efficiency, active participation and engagement in the working place.
Our strategic platform for lean innovation
We seek insight from a wide range of sources to help us better understand the factors affecting the challenge we are trying to solve.
Abstract or concrete, visual or textual – we take an ambitious and open-minded approach to generating ideas in order to produce novel solutions.
A concept has to meet exacting requirements to be chosen: uniqueness, simplicity, potential and scalability.
Lean developmentWe make the concept a reality using a lean approach, smart technology, great design and relevant content
Continuous improvementWe optimize the solution to changing conditions as well as to new technology and market opportunities. We foster continuous improvement to secure long-term business value.
Words that inspire us
“Around here, however, we don't look backwards for very long. We keep moving forward, opening up new doors and doing new things, because we're curious...and curiosity keeps leading us down new paths.”
- Walt Disney Company
Modernising for a better user experience
Lovisenberg Diakonale Hospital (LDH) is Norway’s largest private hospital and a local hospital for around 176,000 people living in central Oslo. The hospital has around 1,300 full-time equivalent employees, and reports annual turnover of NOK 1.8 billion.
Digitisation is having a big impact on the healthcare sector. The hospital, which has been in operation since 1868, has decided to respond to this proactively and has worked with Itera to take its first steps towards digitising its activities.
The hospital’s old telephone system made some internal procedures awkward, and the user experience for external users was also less than optimal:
- The telephone solution was not properly integrated with the hospital’s system for managing employee absence and its employees’ calendars, which meant that neither the central switchboard nor employees had an overview of who was at work and who was not. Because of this, up to half of all calls were returned to the switchboard.
- Up to 40% of the hospital’s patients and their relatives had to wait on hold for long periods when trying to contact the hospital’s polyclinics by phone. After 20 minutes, the calls were automatically cut off, with the callers having to call back.
- Valuable capacity was used for unnecessary work: the old telephone system offered weak support for finding colleagues’ telephone numbers, so many employees were making calls via the central switchboard. This meant that lines were often engaged, with no-one able to get through before a call was completed. The same problem applied to the emergency department, which could be potentially challenging for patient safety.
- There is reason to think that some appointment no-shows at the hospital were due to patients having problems getting through to the hospital by telephone. This may have impacted the hospital’s efficiency.
Introducing new technology often involves new ways of working, and so it should be seen as a change project and not exclusively as a technology project. Itera led the hospital through introducing the new telephony system in close collaboration with the management team and the rest of the hospital. With the help of a lean approach, frequent releases, testing, continuous training and methodology inspired by service design, the hospital now has a modern telephony system. This is a strong platform for making internal collaboration as well as external contact with patients and their relatives simpler, and it also provides secure solutions in the event of any coverage problems or downtime.
All employees with personal phones now have a smart phone on which they can view their email and calendar. Useful apps are available for looking up things in the Norwegian Pharmaceutical Compendium (Felleskatalogen) or for correctly calculating drug dosages. Call queues are now much shorter or have disappeared entirely, and no-one is cut off or has to wait on hold for a long time.
Itera is proud to have contributed to this important step in Lovisenberg Diakonale Hospital’s digitisation journey. The hospital’s ambitions and the results it has achieved have been noticed in the healthcare sector, which is one of the areas of society that will undergo the largest changes in the years ahead. Itera aims to contribute to this with its expertise. After all, our vision is to make a difference.
Consulting when facing disruption
Many of Itera’s customers are seeing their sector or business model disrupted and so need to test out ideas and concepts quickly. Itera has developed its own methodology for this, which combines service design with the principles of lean start-up.
Based on this methodology, Itera has completed a strategy project for an energy group. The reason for the project was the current situation in the energy market, where companies are seeing prices fall and their margins come under pressure. At the same time, major projects are being undertaken to meet new legal requirements, such as introducing automatic measuring systems (AMSs) to enable energy companies to provide customers with a more digital service offering.
Many established energy groups have addressed these challenges by setting up new electricity companies that have new names and lower cost bases. Itera’s customer wanted a quick high-quality overview of how to set up a newly incorporated, profitable and innovative electricity company in terms of the organisation, expertise, products and services it would need.
Itera completed this project using both service design and lean start-up principles in collaboration with personnel from the customer’s business development and executive management teams. The end product was a report that sketched out what a clear direction for a new and innovative electricity company might be and the next steps towards implementing this.
Great experiences. Fast results.
With customers from a broad range of industries across the globe, Sapa is the world’s largest supplier of aluminium. To help ensure good customer communications and a high-quality user experience on digital channels, Sapa asked Itera to assist it with developing a new portal solution.
As Sapa has offices in 40 countries and needs to communicate in 23 languages, it was clear from the start that the solution that was to be developed would be more than average in scope. Itera and Sapa therefore established two main guidelines for the project:
- Customer focus: creating a good user experience by focusing on the customer’s industry and making it simpler for customers to contact Sapa.
- Lean approach: testing the concept out as early as possible to avoid resource-consuming alterations and changes later in the process.
The new solution was built around the day-to-day activities and industries of Sapa’s customers rather than around Sapa’s organisational structure or products. The solution is navigated on the basis of the customer’s industry and geographic location, and it accordingly presents customers with content in their local language. Significant emphasis was attached to ensuring the content was relevant and that it was easy to contact Sapa.
The concept was quality-checked using an efficient method to avoid the need for difficult alterations later in the process. Thanks to the use of a flexible project approach, a functional beta-version of the solution was ready in a remarkable three months, and only four months later the full solution was complete, with the content translated into 23 languages. With only six people, the delivery team was very efficient in terms of set up.
The project is a good illustration of how being a complete provider that offers a full range of services in communication and technology enables Itera to create value. Itera delivered the preliminary project, strategy, design, development (EpiServer), content strategy and communications profile for the solution, and also set up Google Analytics, working at all times in close collaboration with Sapa.
The same week that the service was launched Sapa noticed that displaying the ‘Contact us’ option clearly across the whole solution had a major effect on lead generation.
Strategy sprint: target vision for 2021
The newly established Norwegian Directorate of eHealth is tasked with ensuring national coordination and direction in the ehealth area, as well as with setting up and managing standards that simplify and improve the healthcare and care sectors. All the Directorate’s employees have a target of driving forward high-quality ehealth solutions. The Directorate’s vision is to make the Norwegian healthcare system simpler, and it asked Itera to facilitate a week’s strategy sprint to develop the framework for a long-term product strategy for helsenorge.no, the online portal for healthcare in Norway.
The Norwegian healthcare service is facing major upheaval as welfare technology will inevitably be an important part of future solutions. The current situation is characterised by the existence of many manual processes as well as old and awkward systems that are incapable of talking to each other. There is also a challenge associated with agreeing on a common language and target vision, both in relation to direction and resource use.
By making extensive use of creative methods, Itera facilitated a process that lasted five working days during which we systematically reviewed the current situation, sketched out and obtained buy-in for a target vision for 2021, and developed an overall plan to deliver this. Individual tasks were used to secure a wide range of inputs, while group discussions and exercises led to buy-in for the results and extended their reach. Methods for mapping areas of agreement and disagreement were introduced with the result that the group was able to focus its energy and discussions on those areas that we agreed were the most important. Checklists for product development were drawn up and conclusions written down and refined. And, based on the week’s input and conclusions, Itera developed a recommended implementation strategy with the following basic points:
- Obtain buy-in for the target vision internally and externally
- Build a culture that permits more agile development
- Balance ‘heavy’ and ‘light’ tasks in parallel
- Prepare for active collaboration with external organisations
- Ensure long-term financing
The week was intense, demanding and enjoyable, and was summed up by one individual involved as follows: “We made more progress in five days here than in the previous two years – an impressive methodology well-executed”. For our part, we think that if everyone working in ehealth is as competent and committed as those involved in the project from the Directorate of eHealth, the healthcare challenges we are facing will be solved successfully; it is an area in which many people want to make a difference.