B&O's transformation: Driving innovation, efficiency, and luxury experiences

Strengthening innovation and customer experiences 

After more than 30 years with a self-developed and widely branched IT system, B&O will now standardise. With Columbus as an advisor and sparring partner, B&O has set in motion a comprehensive digital transformation with solutions to match its new structure, business model, and vision for customer experiences aligned with the company's luxury products.

For decades, B&O has pushed the boundaries of streamlined and elegant design in high-end hi-fi products. Now, in collaboration with Columbus, B&O is going back to the drawing board with a digital transformation that promises impactful changes both internally and externally. 

Slow proprietary software 

Since January 2022, B&O has been collaborating with Columbus to simplify, rethink, and streamline its processes downstream – covering distribution, sales, and service –starting from when an item is picked at B&O's distribution centre to its installation at the customer's location. 

"Up until now, we’ve experienced increasing problems with the fact that this vital part of our value chain has been supported by self-developed software dating back to 1991. It goes without saying that over time this system has become increasingly complex and difficult to work with," says Jørgensen. 

B&O wanted to switch from its self-developed system to a standard system. The company chose Columbus, and a solution based on Microsoft Dynamics after a thorough analysis phase, in which Columbus participated together with other potential suppliers.

Involving the entire organisation  

To support B&O in the initial phase of its digital transformation, industry experts and advisors from Columbus conducted a series of seminars and workshops. The objective was to address the significant change management challenge of engaging the entire organisation in taking ownership of the transformation and transitioning the IT system to standardised processes. 

During the design phase of the new IT landscape, Columbus advisors collaborated closely with employees across all areas of B&O’s organisation. Stig Birger Madsen, Market Manager Retail Solutions at Columbus, explains: "We noticed, for example, that employee perception of B&O's end customer varied depending on where in the organisation we asked. It was important for us to deal with that variation in customer image. We worked to increase the degree of familiarity employees had with the individual end customer across B&O's own internal stakeholders, regardless of whether we’re talking distribution, sales, or service. That will enable us to give every customer a luxury experience.”   

According to Madsen, organisational alignment is crucial for a digital transformation to be fully successful. 

"B&O's digital transformation will not only optimise internal processes but will also directly influence and improve interactions with customers. So, we adopted an integrated approach to innovation and customer service, where new technology plays a central role in improving the customer experience.” 

A roadmap has been created for the technology that will support the processes and power B&O's organisational transformation. 

Readying B&O for standardisation 

B&O has worked intensively to become what Jørgensen calls “fit to standard.” 
 
"For us to have the luxury of being able to choose a standard system, we must be more than an 80 percent fit to that standard. Otherwise, we run the risk of still having to develop our own solutions on the back end. And it's just as much a mental process. Our colleagues in the business are starting to experience the consequences of our restructuring, and they’re very excited and supportive. I’m not sure that they would have been if we hadn’t completed this major change management process with the help of Columbus. It was a really good result.” 

Integrating partners into the simplified ecosystem 

During the transformation process, industry experts and digital advisors from Columbus encouraged B&O to take a fresh look at its organisation and its diverse business lines. In the review of the company's existing systems, B&O and Columbus identified several action areas where work could be done more efficiently. One key focus was B&O’s legal setup, which no longer aligned with its new business model emphasising an expanded partner network and omnichannel strategies. 

"Previously, our self-developed system suited our business model and value chain. We had 2,000 stores, and we managed them by having legal entities to handle sales close to each store. That meant a very large number of intra-group transactions, resulting in increasing complexity and administrative overhead. The legal setup has now been greatly simplified, a major prerequisite for us to be able to implement new and more efficient IT processes," says Jørgensen. Today, there are around 400 B&O stores globally, only 10 of which are owned by the company. 

“The rest are operated by partners. Our goal is to develop an IT and process landscape within a unified ecosystem, allowing us to collaborate with our partners just as effectively as we do with our own units,” Jørgensen explains. 

Field service: A total experience in the luxury class 

The first parts of B&O's new service & retail platform are scheduled to go live in the summer of 2024. While some field service solutions are already in operation, a major milestone lies ahead as Columbus develops a new field service solution for B&O’s flagship stores in Paris, London, New York, Hong Kong, and Copenhagen. 

“With this new system, we’ll be able to onboard a new store at a fraction of the cost compared to before, when we had to recode the old system each time,” says Jørgensen. 

The idea is to achieve greater transparency and closer cooperation with partners to ultimately be able to give joint customers an even better experience. 

"When you buy a luxury product like B&O, there has to be a luxury experience associated with it. We believe in the value of a very close match between the online experience and the physical store. You can be inspired online and complete the purchase in a store – or vice versa. The important thing is that the customer gets a total experience in the luxury class, and our new, simplified IT system will support that," says Jørgensen. 

New and improved security model 

In connection with the digital transformation, a completely new security model will be implemented, based around the partner landscape. 

"Right now, we have 4,000 individuals in 400 stores in 70 countries connected to our system. We need to have a secure model to be able to efficiently handle the hundreds of consultants worldwide who enter and exit our system every day," says Jørgensen. 

Jonas Dan Jørgensen: "You have to respect the task" 

The goal is for the transformation to be complete when B&O turns 100 on 17 November 2025. Jørgensen believes the 18 months of analysis and preparation in collaboration with Columbus were well spent. 

"You have to respect the task when you want to implement such a comprehensive IT project in a venerable company with 100 years behind it. You can’t just impose a new system and buy a few licenses. I really believe that we now have the best possible design, having been challenged and advised by Columbus to make sure that our goals will be achieved in the most effective way.”