New ecosystem management for greater innovative capacity
Digitalization and new technologies are changing our core business. Due to much shorter innovative cycles, new markets are arising much more quickly than before and innovative pressure is rising. Tapping into growth potential and ensuring that DB Group remains innovative and competitive in the long term calls for an ecosystem approach.
A central managing and controlling ecosystem holding company is being established to permit effective ecosystem management in DB Group. The primary objectives of ecosystem management are to enhance DB Group’s core business over the long term, develop new business models and enrich our classic core business by innovation. Ecosystems that relate to specific subject areas but are organizationally separate from our core business will be set up within this holding company. An ecosystem comprises a portfolio of:
- in-house and joint developments,
- investments by the acquisition of shares in external companies (majority and minority interests including venture capital financing), and
- strategic partnerships with and without an equity stake.
Each ecosystem interacts with the core business, allowing portfolio companies to benefit from access to customers, network and other DB resources. This gives rise to knowledge transfer, rapid scaling, and access to new technologies and markets, creating opportunities and increasing innovative power. The value of each investment is increased by active management. We define relevant ecosystems in the context of current dynamics in the marketplace, as well as our strategic orientation. In 2019, we will launch the New Mobility and Smart Production ecosystems.
- New Mobility: To retain our position as the largest mobility service provider in Germany and one of the leading providers in Europe, we are establishing DB New Mobility Partner GmbH, which is organizationally assigned to the Passenger Transport division, for this ecosystem. The company’s main job is to continuously formulate DB Group’s strategic approach in the New Mobility market segment and to implement this strategy by building a portfolio of new mobility businesses. This will allow us to combine existing business with new types of mobility, thereby becoming an integrated service provider for our end customers and partners such as transport associations and cities. The portfolio includes companies we have founded, such as ioki and Mobimeo, as well as investments in GoKid, Ridecell and verimi.
- Smart Production: We want this ecosystem to focus on Group-wide digitalization and increase the flexibility of operating processes in our core markets of mobility, infrastructure and logistics. The digitalization of production processes and the linking of vehicles or track infrastructure will allow us to increase the efficiency of value creation in operational processes by cost savings, capacity increases and quality improvements.
An ecosystem can be hived off as an independent management company, transferred to an existing business unit or kept in the ecosystem holding company in the long term. If the first option is taken, the ecosystem holding company remains responsible for the execution of all investment types and close coordination continues.
DB Digital Ventures with five new investments
Deutsche Bahn Digital Ventures GmbH (DB Digital Ventures) is part of our ecosystem management system and invests in data-driven business models to take advantage of the opportunities of digitalization. Its purpose is to intensify cooperative arrangements relating to start-ups and to simplify equity investments in other companies. In addition, DB employees are able to turn their own business ideas into reality under ideal conditions as founders of their own start-ups. In the year under review, the portfolio grew by a further five to ten investments:
- GoKid is a platform for carpooling and lift sharing to get children to school or leisure activities.
- Ridecell provides an intelligent software platform for the operation of car sharing, carpooling and autonomous fleet management.
- Trillium develops cybersecurity software to protect networked vehicles against hacker attacks.
- Coord provides a cloud-based platform for a wide range of mobility data and offers developers of mobility companies access to this data.
- Kepler is a satellite communications company that is building a satellite network to permit standardized real-time connectivity for any Internet of Things (IoT) device.