The world is changing. New conditions, ways of work and possible crises are reshaping the way companies and organizations run their businesses. Technology plays a key role in today’s new age and society is adapting very quickly. Barbara Domicelj, Country Manager of Microsoft Slovenia, recently shared her thoughts on how technology can improve businesses, the impact it has on society, and how innovation and sustainability can help each other for the greater good.
Is technology to blame for the current crisis? Why so?
Since the 1950s, the world’s population has tripled to almost eight billion people, and economic output has increased by as much as 12 times. On the wings of rapid technological development, hundreds of millions of people around the world have risen from poverty – but on the other hand, this extraordinary growth has also led to the collapse of ecosystems and caused climate change. However, the current crisis can only be successfully dealt with through technological innovations since we are simultaneously facing the side effects of the pandemic, interruptions in supply chains, and, increasingly, the energy crisis. At Microsoft, we believe that technology will help us achieve a more sustainable future with inclusive economic growth and more creative jobs with higher added value.
Could technology be the answer – can it ensure economic recovery? How?
In a period of high inflation, digital technologies can be a powerful deflationary force, as they enable companies to increase productivity and, consequently, the affordability of their products and services. A good example is digital twin technology, which allows us to simulate manufacturing processes and supply chains in the cloud, helping us to develop better products faster and with less waste and lower consumption of natural resources. Mixed reality is also gaining ground in healthcare. We found through research that healthcare facilities that implemented the HoloLens 2 mixed reality solution reduced the time needed to conduct visits and train employees by 30 percent, and also reduced annual costs for personal protective equipment by 75 percent. At the same time, especially in the last two years, we have fully understood that developing a continuous and successful business depends on people ready to take full advantage of all the possibilities of digital technologies. Simply investing in technology is not enough; we also need digital skills and management that puts digitization first and promotes a culture of hybrid work. Real breakthroughs are created by technologically aware managers who want to draw as many strategic advantages as possible from digital transformation.
The economy needs more agile companies. Technology is only part of the “agility equation.” How can it improve employee performance/business performance?
Companies that survive and thrive despite unexpected changes have one thing in common: agility. They know when to innovate and when to adapt to forces stronger than themselves. All of this requires business agility, and if we’ve learned anything lately, it’s that business resilience and agility don’t exist without data and technology. Good examples are very rapid changes in where, when, and how we work. We know that companies that have adapted to hybrid work are more successful, and it is easier for them to acquire new and retain existing employees. Specifically, 73 percent of workers want to maintain the flexibility of work they enjoyed when real life was on pause. At the same time, 67 percent want more direct contact with colleagues. Only technology solutions like Microsoft 365, which bring together all the resources an organization needs to transition to hybrid work successfully, can support this kind of flexibility quickly and cost-effectively.
New conditions also require a better understanding and business management. This is not possible without quality data and insights. It seems that companies are just beginning to use business analytics and intelligence, especially artificial intelligence. Which technologies will drive business operations in the future or will be the most crucial for their growth and development?
We live in the era of data and artificial intelligence. Key business logic is no longer created solely by developers but is already written by software. Even more, as early as 2025, 10 percent of all data is expected to be generated by artificial intelligence models. Analytics is thus moving from back-end processes to the very core of the customer’s experience with the product or service. The European Commission estimates that the data economy in the EU will reach a value of 829 billion euros in 2025 – as recently as 2018, it amounted to 301 billion euros. Organizations have the opportunity to use data and artificial intelligence to create new business models, products, and customer experiences. An excellent example is provided by the automotive industry, which in 2020 employed more software developers developing new digital solutions and services than it had employed mechanical engineers the year before.
Technology and society
Technology not only drives business, but also society as a whole. Where and how is the impact of technology on society most felt?
Perhaps we are unaware of how quickly the conditions in which we live have radically changed. In just a few centuries, we have transformed from agricultural societies scattered in small villages and towns to a tightly-knit global society exploring space. The foundation of this progress has always been our ability to take advantage of new technologies. This ability is even more critical today, when we are faced with many economic, social, and health problems. How will we feed the world’s population, which is expected to reach 10 billion in 2050? How to achieve this with less impact on the environment? How to increase productivity and adapt to demographic trends that could otherwise halve economic growth? And, of course, how will we prevent the dark scenarios of climate change? At the core of all solutions to these and other problems will be new technological innovations and people who will have the knowledge to create them and make the best use of them. For this reason, we are investing in efforts to equip more people with digital skills. For example, with the Global Skilling Initiative framework, more than 20,000 inhabitants of Slovenia acquired new knowledge for free. We are also trying to get more women interested in careers in the ICT industry.
Is modern society a safe society? Why? What else can technology do in this regard?
If I limit myself only to the field of information technologies, hardly a day goes by without news about cyber attacks on critical infrastructure. These attacks, whether aimed at healthcare facilities, utility companies, or government organizations, can cause significant damage to both individuals and society as a whole. Organizations are seeing an increase in both the number and sophistication of cyber-attacks. The total damage caused by cybercrime is expected to reach as much as USD 10.5 trillion by 2025. Therefore, cybersecurity is among the main priorities of all organizations implementing digital transformation, with increasing attention to ensuring organizational resilience, i.e., the ability to restore systems and restore normal operations as quickly as possible after an attack or error. The cloud is a necessary part of resilience today, as it is built into its design. The war in Ukraine highlighted the importance of resilience in the most radical way. Unsurprisingly, Russia targeted Ukrainian government data centers in early missile attacks, and other servers at customer sites were similarly vulnerable to conventional weapon attacks. It also targeted its destructive Wiper cyberattacks on customer computer networks. But the Ukrainian government has successfully maintained its civilian and military operations by rapidly migrating its digital infrastructure to public clouds hosted in data centers across Europe. This required urgent and extraordinary action by the entire technology industry, including Microsoft.
Social beliefs seem to be shaped more and more by digital media and even fake news. How “real” is digital? In modern society, do individuals still have their own opinions or is it much easier to be “programmed” through the content and advertisements shown on a wide variety of screens?
Attempts to manipulate the masses by creating falsehoods are as old as mankind. It is true, however, that modern technologies have transformed the power, scale, and effectiveness of disinformation campaigns, giving malicious actors the tools to implement, control, and optimize the spread of fake news much more easily. We have to deal with this on several levels, and investments in modern media literacy are critical. People need to be given the knowledge to understand and recognize false and misleading information. Of course, we can expect that technology such as artificial intelligence will also come to our aid in this. At Microsoft, among other things, we study artificial intelligence technologies that, by recognizing patterns in communication and content, reveal intent to deceive, and we work with media houses such as the BBC to develop solutions that will enable news users to judge more easily whether the news is trustworthy.
Social media uses a considerable amount of the average individual’s time every day. How does this affect their productivity and business operations? What could be changed/improved in this area?
Effective work and cooperation of employees is the goal of every company. At the same time, we know that people are most productive when they can focus on important projects in peace and without distractions, and we all also need moments when we can disconnect and relax. In response to this challenge, we designed Microsoft Viva, an employee experience platform that helps employees stay connected to the company and its culture, no matter where they are or work from. With tools like Viva Insights, employees, their leaders, and managers can maximize time for focused work (calls, emails, or other messages) without distractions, as well as time for breaks and relaxation. The solution is, therefore, not in bans but in better work planning based on the right data and best practices.
Green? Innovative? Competitive? Digital!
As far as the carbon footprint is concerned, the ICT industry is increasingly seen as not a clean one, even a polluter. How to decarbonize IT?
True, our industry also has a lot of work to do in the area of environmental protection. A good example is the data centers that drive our digital lives, where we are faced with the task of how to support the exponential growth of data and digital services and reduce the impact on the environment at the same time. Data centers are a crucial piece of the puzzle in our strategy to become carbon negative by 2030. We have set ourselves the goal of reducing water consumption in data centers by 95 percent by 2024 – which amounts to 5.7 billion liters of water annually. We develop new, more efficient cooling technologies and design data centers that are better adapted to the ecosystem in which they operate. Additionally, we reduce the carbon footprint of materials and construction processes associated with data center construction. All of this is rounded off by our commitment that in 2025 all of our data centers will be powered by energy from carbon-free sources – at all times.
What is green IT and how to implement it in business?
Many organizations have already set themselves the ambitious goal of achieving net zero carbon dioxide emissions. Reducing the environmental impact of their IT operations is also a necessary part of the effort. However, on the way from the goals to the actual reduction of emissions, they often realize that they do not have the tools and technologies that would allow them to make this transition accurately, efficiently, and supported by data. At Microsoft, we know this problem very well, as we have encountered it in realizing our environmental goals and have incorporated the lessons learned into cloud solutions. That is why our general director for sustainable solutions, Mark Kroese, will join us at this year’s NT conference. He will present to the participants first-hand the experience in realizing our sustainability commitments, as well as the solutions that can help Slovenian organizations achieve their environmental goals more easily.
How can innovation and sustainability go hand in hand? Can you give any practical examples?
Our Circular Centers, which deal with electronic waste, will play a vital role in our journey to recycle 90 percent of the hardware we use in our data centers (servers, network equipment, and solutions for data storage) in 2025. The first center of this kind has been operating since 2020 in Amsterdam. To date, it has managed to hand over 83 percent to reuse and recycle 17 percent of hardware, and we are constantly expanding the network of these centers. For this purpose, we have also set up a system that uses artificial intelligence and machine learning to process and classify a wide range of equipment and create the best reuse plan for each item. We believe that this technology could revolutionize how we approach the circular economy in the technology industry.