The corona crisis as a catalyst for the digital transformation in the sanitary trade?

The term Work 4.0 is connected with the discussion about the fourth industrial revolution, but focuses on modes of working conditions – not only in the industrial sector but also in the entire working world. The digital transformation is leading to profound changes in business models, organizations and work design. The working world of the future will be more digital, flexible and networked. The corona crisis has shifted the framework conditions with regard to communication both within the company and with customers. Many companies are becoming aware that too little money and time has been invested in digital infrastructure. The aim of this essay is to find out to what extent the corona crisis serves as a catalyst for the digital transformation in the specialist sanitary trade. The study carried out for this purpose leads to the result that the use of video conferences and home offices have increased and will also be used more frequently in the future. In contrast, the use of targeted multi-channel measures in the form of virtual showrooms is on the decline.

1 Introduction

Intelligent robots in the factory, smart technology in the office: Digitization is changing the working world at an unprecedented pace. Much of what is still done by people today will be done by machines tomorrow. Fixed jobs and times are becoming less important. This development offers new opportunities but also bears risks. It presents employees and companies with completely new challenges: If you want to keep pace with rapid change you have to constantly develop and react to changing requirements. The buzzword for this development is „work 4.0“. It refers to the history of industry and the first three revolutions that changed the world of work and society in the long term (Deppe 2017).
• Industry 1.0 – The first industrial revolution started with the steam engine at the end of the 18th century. It started from Great Britain and later covered all of Europe. Machines were increasingly replacing human work; the mechanical energy generated by pistons was used to drive locomotives and the beginning textile industry. Since a lot of coal was required for combustion, mining was also becoming increasingly important.
• Industry 2.0 – At the beginning of the 20th century, mass production based on the division of labor begins with the help of electric energy. In 1913, Henry Ford started the assembly line production of automobiles and the division of production into individual, specialized work steps. At the beginning it was still assembled by hand, later more and more processes were automated for cost reasons.
• Industry 3.0 – At the end of the 1970s the computer revolutionized the working world. Konrad Zuse had already invented it in 1938 but at first it was laughed at as an expensive toy. Now the triumphant advance of EDP, short for electronic data processing, begins. Banks and insurance companies use word processing systems and computers for calculations, computer-aided robots move into the factory halls. Difficult and dangerous work such as punching or welding has been done by automatic machines ever since, with a precision that is impossible for humans.
• Industry 4.0 – The core element of the fourth, currently ongoing industrial revolution is the connection of products and processes via the Internet. Unlike in the past, systems are no longer just networked within a production facility but along the entire value chain. Similar to social networks, intelligent machines and production parts exchange information with each other and with people in order to organize themselves independently and to coordinate processes and appointments.

According to this system, Work 1.0 describes the beginning industrial society from the end of the 18th century and the first workers’ organizations. Work 2.0 describes the beginning mass production and the beginnings of the welfare state at the end of the 19th century. Work 3.0 covers the period of consolidation of the welfare state and workers’ rights on the basis of the social market economy. Now the digital change to work 4.0 follows. As a result, the mode of work is not only changing in the factory. Digitization has long since reached all industries. Take the office, for example: thanks to digital communication and information technologies, employees can work at different times and in different places, even together in a team or on a project. Working hours and work places are becoming more flexible. This can make it easier for parents, for example, to combine work and family. But there is also the risk that the balance between work and leisure will continue to blur and that there are hardly any rest and relaxation phases due to the constant availability.

1.1 Objective and method

The aim of the study is to examine the changed perception of the relevance of virtual showrooms and the impact of their use for retailers after the lockdown in the context of the corona crisis. Has this type of presentation increased in specialist shops? Are more employees being sent to the home office? And are video conferences establishing themselves as an integral part of communication? This publication is intended to complement the study „The relevance of virtual showrooms for the sanitary retail trade“. To create a basis for discussion, these questions are condensed into three hypotheses, from which the questions for the online survey result:
• H1: The use of virtual showrooms has increased in the course of the crisis.
• H2: The use of the home office increased during the corona crisis.
• H3: Video conferencing will establish itself as an integral part of retail communications.

The work begins with an introduction and the description of the objectives in Chapter 1. Chapter 2 shows the structural requirements for the work 4.0. Chapter 3 outlines the topic of digitization as a cultural issue. Chapter 4 raises the question of whether the corona crisis will become a catalyst for the digital transformation in retail. Chapter 5 provides an overview of the hypotheses that have been established and the study design is presented. Furthermore, the results of the individual hypotheses are shown and explained to the reader. Chapter 6 summarizes and explains recommendations for action.

2 Structural prerequisites for work 4.0

The basis and booster of this development is technological progress. Computers have become faster and more powerful in the last years, and more and more data can be stored and used for new business models. That is why tablets and smartphones are now replacing files and stacks of paper in companies. Mouse, keyboard and clicks replace writing down information by hand or the tediously filling out lists, computers evaluate important data in seconds. All employees must be sensitized and trained in how to safely handle the growing amount of data – because the more data from production and administration flows digitally, the greater the risk that it will be stolen or otherwise misused. Infrastructure, education and opportunities to work from home are important aspects here.

Infrastructure
The bandwidth of data transmission has multiplied. Mobile devices such as tablets or smartphones make it possible to access information from anywhere. Due to the ever-increasing networking, all actors in a value chain, from raw material suppliers to suppliers, factories and retailers to the end customer, can be directly connected to one another. However, Germany is not a pioneer in digital transformation. The Federal Republic of Germany is not in the lead when it comes to cell phone networks or high-speed internet. When it comes to digital infrastructure, the economy is all the more dependent on politics creating the framework. The comprehensive expansion of broadband and fiber optics serves to secure economic livelihoods, it is an important location factor and must take place quickly in all parts of Germany. Small and medium-sized enterprises in particular are located away from the major metropolitan areas. Industry needs a network that is fast, comprehensive and stable (BMWI 2015). In rural regions in particular, only 69.4 percent of households are supplied with a bandwidth of 50 Mbit/s or more (BMVI 2019, p. 4).

Changed consumer behavior
It is already foreseeable that changed consumer habits will affect working life. E-commerce has radically changed many industries. As customers, we shape the economic and working world by asking for and demanding services that others provide. In some cases, the changed social structure and changes in values result in completely new consumer habits and needs, which in turn can be satisfied in a new way or better by the digital economy. For example, the temporary access to and the temporary use of products (e.g. cars) and data (e.g. music) seem to be gaining in importance compared to traditional property acquisition. The desire to live and consume sustainably is also fueling a new sharing economy. At the same time, customers expect their consumption needs to be satisfied more quickly in the „on-demand economy“. As prosumers or as „suppliers“ of data and self-generated content, customers and users are actively involved in innovation and value creation processes (BMAS 2017, p. 39). At the same time, modern processes such as 3D printing make conventional production methods superfluous (Deppe 2017).

Digital education
The digital transformation of economy and society can only succeed with digital education. “Digital education” means the ability of people to successfully cope with digital change in their private and professional everyday life as responsible citizens and to make responsible use of technical possibilities. In addition to the security in the practical handling of PCs, smartphones, tablets & Co., this also includes self-management skills, communication and teamwork skills, innovative spirit and systemic thinking – all of this embedded in the ability to openly but reflectively deal with the new technologies (Kautzky 2018). Digital technology enables learning regardless of time and place. You can learn in a subway or on a train via smartphone and apps, regardless of whether it is English or technology. Learning is more fun with these interactive programs. And finally, in times of digitization, further training is becoming more and more important in order to stay with the job (BMWI 2015). If the corona crisis shows us one thing: It’s about solving new tasks quickly – even with missing information and uncertain prospects – together with a simultaneous learning process. The last few weeks have shown that it usually works. Many competencies only emerged during the crisis and the digital innovations paired with an openness to the unknown were particularly helpful. If we want to actively shape the future of work today, we inevitably have to break old ways of thinking. Digitization helps us here, both with the technology and with the associated mindset. That means nothing more than breaking down thought patterns and going creative ways (Rieke, Rübner and Speth 2020, p. 5).

Independent work
Thanks to laptops, internet and Skype, employees can be active for their company at home and commuters can use the time on the train or subway. This makes it easier to harmonize family and work. Office jobs still mainly benefit from this, but this is also conceivable when monitoring machines. Both employees and companies must ensure that work does not spill over into private life – and vice versa. Since the outbreak of the corona virus, more and more people have been working from home – provided that their activities are suitable. Even in companies that previously only allowed home office for a day or not for all employees, as many employees as possible were now often sent to the home office. However, it also shows that the technical requirements are not always available to enable home office. Sometimes there is a lack of the necessary number of notebooks for the employees, sometimes the licenses for VPN access are missing. Employers should provide their employees with home office guidelines to make it easier for them to work securely and in compliance with data protection regulations. Overviews can help to structure work in the home office and simple measures help to ensure the so-called technical and organizational measures. The employer must of course take and establish some measures. This includes in particular setting up a suitable IT infrastructure, access control, output of service devices, etc. (Bitkom 2020b).

3 Digitization as a cultural topic

The future viability of companies naturally depends on a whole range of different conditions. One of the greatest challenges is digital change. In the structural change towards the information and network economy, traditional business models and traditional work processes have to be put to the test. This necessary change process has the best chances of success if the employees can actively contribute their know-how from the start. This concerns both the future requirements for profiles, competencies or qualifications and the design of working conditions. Not least against the background of demographic developments and the emerging shortage of skilled workers, future competitiveness also requires a corporate culture that takes greater account of the needs of employees for more self-determined work.

Digitization is therefore less a technical and more a cultural issue within an organization. There are often points of friction between the cultural requirements of digitization and the culture that exists in the company. Compatibility is not automatically given: proprietary knowledge, strict hierarchies, top-down communication and classic media structures are still prevalent in companies and are contrary to transparency, real time, dialogue orientation and participation. This makes it clear that digitization cannot automatically intervene in corporate culture and change it. Rather, the culture and structure of a company must change and promote openness, transparency and networking. Most companies have a hard time with that. In order for digitization to find a suitable foundation, the management culture of a company must open up and allow decentralized self-control and personal responsibility instead of hierarchical, centralized control. An open corporate culture is the key to successfully integrating digitization. In addition to the activating role of managers, the attitude of employees with regard to actual use is of enormous importance. If hierarchically managed companies embark on comprehensive digitization, they must be able to learn and allow communication flows in all directions. The executives ideally internalize and exemplify this type of communication.

The new possibilities of digitization and the change in culture and everyday life are interrelated. Broad access to information, communication via social networks, the influence of algorithms on our thoughts and actions – all of this will fundamentally change our society. To what extent a „culture of digitality“ is developing and if this in turn will change the world of work cannot be said precisely today. Demographic change and the retiring baby boomer generation are casting their shadows ahead. The war for talents is intensifying. We all notice this in our daily work. Above all, however, we are dealing with a new generation of young professionals who are emerging and who will also penetrate management levels in the medium term. The so-called Generation Y born after 1980 want to work differently, they want to be managed differently – and they will also lead differently in the future. If you want to be attractive to young high potentials, you have to adapt to new perspectives, changed performance thinking, new motivational mechanisms and much more (Huber and Rauch 2013).

4 The corona crisis as a catalyst for the digital transformation in retail?

Whether digitization will cost or create jobs cannot be foreseen today. However, experts believe there will be significant shifts. In particular, light work will be eliminated, while there will be an increasing need for skilled workers in areas that require higher qualifications. This applies to programming or monitoring machines, for example. One thing is certain: if you want to assert yourself on the job market of the future, you have to be ready to constantly develop and adapt to new requirements. Work 4.0 means lifelong learning – if it has to, into old age: Because work is less physically strenuous and virtual assistance systems such as data glasses support intellectual work, people will be able to work longer in future than they do today.

The corona crisis presented retailers with an elementary problem, especially during the lockdown: How do I get in touch with my customers? Well-coordinated multi-channel sales with a combination of online shop, local sales outlet, mobile sales methods and catalogs can best meet the challenges and realities of the markets. Multi-channel strategy is the retailer’s strategic approach to reaching potential consumers on several different communication channels.

The multi-channel trade represents the parallel use of several operating and / or sales types in the trade within the scope of the distribution of trade companies. This is a multi-channel system in which the customer can request services from the same provider on at least two channels. These channels are mostly brick-and-mortar retail and an online shop (Rittinger 2014, p. 3). With increasing digitization and networking, more and more retailers are switching to a multi-channel strategy. With multi-channel sales, retailers can expand their distribution and thus reach more potential new customers. Thanks to an online shop, the retailer is permanently available, the opening times are no longer an obstacle, because transactions can be concluded at any time in the online shop. For specialist retailers, this means acting counter-cyclically and investing in the crisis in order to be future-proof (Strach 2020, S49).

Some companies already rely on the development of 360 degree images. The customer can view a product from all sides and from different camera perspectives in a relaxed manner from home. The retailer is thus able to show all of the bathrooms that have already been renovated as a reference on his website. Digitized showrooms with multimedia presentations and impressive interior design are intended to draw customers deep into the manufacturers’ brands. The virtual showroom is not only used for inspiration and advice. If the emotional buying process is initiated for the end customer through the virtual experience, he can have his individual bathroom planned directly. If this is designed according to the wishes and requirements, the end customer can experience his own bathroom almost in advance. The 360 degree images are displayed on the monitor. The advantage of displaying on the monitor is that the content can also be integrated into your own website. During the opening hours, advice takes place in the 3D showroom on a large monitor in the exhibition area. The specialist retailer can show his customers bathroom renovations that have already been carried out using 360 degree images. For each individual product, he can show the customer virtual exhibits from his manufacturer’s portfolio. The virtual showroom lives from implemented projects that are transmitted to the showroom with a 360 degree camera. These references show the customer what the dealer can do in terms of planning and craftsmanship. This leads to transparency, since technical errors are revealed. In this way, the customer knows in advance what to expect in terms of manual work. The survey of 251 specialist retailers from January 2020, i.e. before the corona crisis affected the economy with all its restrictions, gave the following table.

Table 1: What is the status quo with regard to a 3D showroom in your company? (January 2020)
Source: Diedrich and Peplinski (2020, p. 30)

It can be assumed that the specialist dealers in the sanitary specialist trade gave a lot of thought to the possibilities of multi-channel retail, especially during the lockdown, and above all to the 3D showroom. That leads to the thesis:

H1: „The use of virtual showrooms has increased in the course of the crisis.“

Many employers have sent their employees to work from home, at least temporarily. This also applies increasingly where people have not previously worked in home office. The number of employees present in the company has been and is in some cases greatly reduced and rotating attendance has been introduced in order to meet the requirements of health protection as much as possible. In some places, entire companies are even being closed and work still to be done is being relocated to the home office (Grunau, Steffes and Wolter 2020). Mobile working also takes environmental concerns into account. Reducing commuter traffic, for example, has enormous potential for saving CO2. Travel times can be significantly reduced through video conferences and work processes can be made much more efficient through digital platforms for collaboration in the cloud. During the corona crisis, home office and mobile working helped many employers and employees a lot in keeping business going and in balancing work and private life. During this time, the proportion of employed people who work from home has increased enormously (Bitkom 2020a).

Before the outbreak of the corona pandemic, there was previously untapped potential for home office opportunities in Germany, which should now lead to an increase in working from home. However, these options depend heavily on the structure of the jobs. Wherever there is increasing work with machines and systems, the hurdles are still relatively high, at least so far. This is also evident in the current crisis. The major automobile manufacturers have already closed their production plants or have shut down production significantly. As a result, this could also mean that jobs in administration remain vacant during this time, although these activities could be relocated home. A dismantling of the technical hurdles, for example through better equipment with hardware and software and better broadband coverage, could nevertheless help to keep part of the German economy going (Grunau, Steffes and Wolter 2020).

H2: „The use of the home office increased during the corona crisis.“

The coronavirus crisis has given many Germans a completely new experience. Since they are forced to work in the home office, contact with colleagues is maintained via video conferences. The aim of video conferences is to replace classic meetings with a simulation of face-to-face meetings with images and sound. These are essential in a virtual setting, especially to carry out effective interactions for complex team tasks. Creative retailers in the retail sector have also sought contact with customers in this way and thus maintained it.

H3: „Video conferencing will establish itself as an integral part of retail communications.“

5 Survey

The study carried out was aimed at the sanitary specialist trade of the 2-stage sales channel. The study was carried out in August 2020 using an online questionnaire. As part of the study, a conscious decision was made to select the concentration. All buying companies in the bathroom and sanitary trade were filtered out of the customer base and included in the sample. In order to find out the relevance of virtual showrooms and the impact of their use for retailers, three hypotheses were defined:
• H1: The use of virtual showrooms has increased in the course of the crisis.
• H2: The use of the home office increased during the corona crisis.
• H3: Video conferencing will establish itself as an integral part of retail communications.

Interview participants (s): 192
Survey method: Online questionnaire
Investigation period: August – October 2020

Hypothesis 1: The use of virtual showrooms has increased in the course of the crisis.

The first table shows how many customers have already used a 3D showroom in January 2020 or have thought about using it and how many customers do not use it and do not plan to use it.

Table 2: What is the status quo with regard to a 3D showroom in your company? (January 2020)
Source: Diedrich and Peplinski (2020, p. 30)

The following table shows how many specialist dealers will be using a showroom, are thinking about using it or are not planning to use it in August 2020.

Table 3: What is the status quo with regard to a 3D showroom in your company?
Source: Authors

In the corona crisis, fewer respondents than before are thinking about using a 3D showroom. In January of that year it was 31.47%, in August only 22.22%. The number of respondents who already have a 3D showroom has fallen slightly. The number of respondents who are not planning a 3D showroom has risen from 48.21% to 58.89%. The thesis that the use of virtual showrooms will increase in the course of the crisis is not confirmed by this.

Hypothesis 2: The use of the home office increased during the corona crisis.

Table 4: How often do you use the home office option in your company?
Source: Authors

Even before the corona crisis, the sanitary retail sector had a few employees working in the home office. 6.11% of the respondents at least once a week and 4,44% even several times a week. Ultimately, however, 89,44 % worked with the entire team in the shop or the office space.

During the corona crisis, the proportion of companies that let their employees work from home at least once a week increased to 16.29%. 6.18% of those surveyed even used the home office several times a week. 77.53% did not use the home office. The thesis is thus confirmed.

78.65% of companies also state that they will not send their employees to the home office in the future. Otherwise, in contrast to the crisis, the numbers of homeworkers will hardly change. Once a week, 15.73% will use the home office and 5.62% several times a week.

Hypothesis 3: Video conferencing will establish itself as an integral part of retail communications.

Table 5: How often do you use video conferencing?
Source: Authors

Stationary retail is designed for direct customer contact in the shop. Before the corona crisis, both customers and sales representatives from the manufacturers naturally found their way to dealers. Before the crisis, video conferencing was not an option for 96.11% of respondents. The proportion of respondents who conducted a video conference at least once a week was at a low level of 3.33%.

The proportion of respondents who hold video conferences at least once a week rose to 20.90% during the corona crisis. 4.52% also use this tool several times a week. The vast majority (74.58%) did not hold video conferences during the crisis. This confirms the thesis that video conferencing will establish itself as an integral part of communication in retail.

This level should also be maintained after the crisis. 20.90% of the respondents want to hold a video conference at least once a week in the future. 3.39% will even use the video conference tool several times a week.

6. Summary

6.1 Theoretical implication

All employees in a company can benefit directly from digital change, for example with a better work-life balance through the use of flexible forms of work or through the elimination of physical or monotonous work due to further automation. Companies are very interested in taking their employees with them on their way into the digital world of work. At the same time, employees are required to adapt to the change independently, for example by making more efforts in education.

Not all companies seem to be adequately prepared for this, however: According to a study by the Institute for Employment Research in Nuremberg, around a quarter of companies in Germany currently offer the possibility of mobile working. Before the outbreak of the corona pandemic, there was a previously unused potential for home office opportunities in Germany, which is now leading to an increase in working from home. However, these possibilities depend heavily on the structure of the jobs. The corona virus is therefore forcing many companies to think more about digitization. However, the development of modern, digital processes should also continue to be driven forward regardless of the current challenges.

6.2 Practical implications

In the corona crisis, fewer respondents than before are thinking about using a 3D showroom. The thesis that the use of virtual showrooms increased during the crisis cannot be confirmed. Rather, it should be noted that interest in the future use of a showroom has decreased.

The survey shows that the option of working from home is increasingly being used. Ultimately, however, only every sixth company sends its employees to the home office at least once a week and every thirteenth several times a week. This trend should continue in the future. This confirms the thesis that home office use has increased during the crisis.

More than a quarter of the companies surveyed have discovered video conferencing as an efficient and time-saving tool. You currently use it at least once a week and want to continue to do so in the future. In general, it can be said that three quarters of those surveyed are not using the tool currently or in the future. Nevertheless, the thesis is confirmed that video conferencing is establishing itself as an integral part of communication in retail.

These values coincide with the results of other, cross-industry studies. Ultimately, it can be said that the crisis is driving digitization. Interested and innovative companies use the opportunity to set themselves apart from the competition.

6.3 Limitations

With the help of the hypotheses mentioned above, a questionnaire was created with which retailers of the bathroom and sanitary trade were interviewed. In addition to this sales channel, the following further sales channels are possible in the market for bathroom furniture, mirror cabinets and illuminated mirrors: furniture and kitchen trade, DIY trade (hardware stores), distance selling and contract business. As part of the study, the choice of concentration was consciously made. All buying companies in the bathroom and sanitary trade were filtered out of the customer base and included in the sample. Concentration selection involves consciously concentrating on a part of the population that is considered essential or typical in relation to the subject of the survey. Taking a sample according to the concentration principle means that one draws a sample on the part of the population in which the majority of the elements sought are suspected. These selection procedures are problematic with regard to the representativeness of the results in the samples, since the selection is not based on the probability principle, but on factual considerations. This targeted selection is wanted because this study specifically addresses a submarket.

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Kľúčové slová/Key words

social media marketing, social networks, multi-channel marketing, virtual showroom, corporate strategy, corporate communication, cultural change

marketing na sociálnych sieťach, sociálne siete, multikanálový marketing, virtuálna predajňa, podniková stratégia, podniková komunikácia, kultúrna zmena

JEL klasifikácia/JEL Classification

M31

Résumé

Koronakríza ako katalyzátor digitálnej transformácie v sanitárnom obchode?
Pojem „práca 4.0“ súvisí s diskusiou o štvrtej priemyselnej revolúcii, ale zameriava sa na režimy pracovných podmienok – nielen v priemyselnom sektore, ale v celom svete práce. Digitálna transformácia vedie k zásadným zmenám v obchodných modeloch, organizáciách a dizajne práce. Svet práce budúcnosti bude digitálnejší, flexibilnejší a prepojenejší. Koronakríza posunula rámcové podmienky týkajúce sa komunikácie v rámci spoločnosti aj so zákazníkmi. Mnoho spoločností si začína uvedomovať, že do digitálnej infraštruktúry sa investovalo príliš málo peňazí a času. Cieľom tohto príspevku je zistiť, do akej miery koronakríza slúži ako katalyzátor digitálnej transformácie v špecializovanom sanitárnom obchode. Štúdia uskutočnená za týmto účelom vedie k výsledku, že sa zvýšilo využitie videokonferencií a domácich kancelárií, ktoré sa budú v budúcnosti využívať tiež častejšie. Naopak, využívanie cielených viackanálových opatrení vo forme virtuálnych showroomov je na ústupe.

Recenzované/Reviewed

10. September 2020 / 15. September 2020