Digital transformation is accelerating in a wide range of sectors, but it is unclear what it actually means and what it should entail. Everybody seems to have their own definition of it, and to be conducting their own experiments.
CJ Group Chief Digital Officer and CJ OliveNetworks CEO Cha In-hyok, noting his company as among those accumulating trials and experiments, shared the story of how he took the retail-to-entertainment conglomerate on its digital journey.
Speaking at the Korea Herald Biz Forum held Tuesday at the Shilla Seoul, the executive first focused on big tech companies such as Google, Facebook and Amazon, who built platforms, structured new markets and strengthened customer values based on rapidly growing network effects. Cha referred to them as “disruptors” who gradually replace existing businesses and players through their ”disruptive“ innovations.
But, the reality for the majority of companies may be slightly different, according to Cha. Numerous small businesses and workers have not opted for a digital transformation yet, including 6.6 million enterprises and small businesses and their 20 million workers in South Korea’s case.
“The question is how do the rest of us transform ourselves, and who is there to actually assist that transformation,” Cha said.
Cha introduced some of the company’s digital transformation projects.
One case is how CJ OliveNetworks has utilized satellite imagery, artificial intelligence and domain knowledge to predict pricing dynamics of major crops that CJ Group is involved in trading.
Cha said that this method, which combines AI and satellite images, can possibly save a significant amount in procurement costs for the conglomerate that annually spends $30 billion to import major crops.
Through this measure, the company could also maintain its global competitiveness, particularly in a post-COVID-19 world where the global supply chain remains disrupted.
With technology, “you can know and discover things that you had not known,” Cha said.
Cha also shared the potential that satellite imagery analysis has in the future. According to Cha, there will be around 25,000 satellites in Earth’s orbit by 2030. Equipped with cameras, they will send accurate images of what’s happening on Earth, which will be a valuable resource in a wide range of sectors.
Cha added that CJ OliveNetworks is in talks with CJ Group affiliates for the potential applications and benefits that such data analytics can bring them.
Meanwhile, Cha stressed the importance of open innovation, as well as a corporate culture that encourages it.
Cha said the goal of digital transformation is not to build a platform that will eventually replace all existing players. Instead, Cha stressed the value of collaborations between companies and individuals.
“It is about openness. It is about working with others and thinking what you can do first with them, instead of how can you (just) utilize someone else’s technology,” Cha said, emphasizing openness as the most critical value in digital transformation.
By Shim Woo-hyun (email@example.com