How Axel Johnson International’s IT division handles constant acquisition

The family-owned industrial group grows by an average of up to 20 companies every year and the central IT staff have become experts in migrating them into Microsoft 365 – a cornerstone of the group.

Axel Johnson International is an industrial group within Axel Johnson, which also owns Swedish food retailer Axfood and Dustin, the online IT partner in the Nordics and Benelux, among others. The group develops and acquires industrial companies in selected niche markets, including just over 200 companies in six different business areas with a focus on, among other things, technical components and industrial process solutions.

In general, the group is decentralized and places an emphasis on the entrepreneurial culture of the individual companies. But there are some areas where central staffs have been created.

“We reorganized in 2017 and then also decided to create certain central staffs — finance, sustainability, M&A and IT,” says Mårten Steen, CIO at Axel Johnson International.

Although the companies within the group have a high degree of self-determination, there are areas where the central IT department controls the decisions, and is responsible for cyber security, and ownership of networks and clients, so M365 applies throughout the group.

“Those are the areas where we decide centrally, but, having said that, there are no rules without exceptions,” he says. “If we buy a small company group that’s just implemented a new network, for example, we’ll have a dialogue that may end with us connecting to their network instead.”

Clear process

Today, all companies in the group have entered M365 and there’s a well-proven and clearly designed process for how new companies are moved into that environment. Steen estimates that on average, between 15 and 20 companies are added each year. So the reason to have everyone in M365 is partly connected to security and partly because there’s a lot of information there that everyone should be able to take part in.

“In the beginning, when it was new to us, it could take a little time, but today it goes very smoothly,” he says. “We’re often ready to move with a new company within 100 days, and we have a special team for that, which has done around 150 such onboardings, so they’ve experienced everything that can happen. They’ve built up a great deal of knowledge and competence in the area.”

But there’s also another role for the central IT staff in addition to managing cyber security and migrations of acquired companies.

By building an integration platform, a variety of IT tools and services can be offered and made available to companies regardless of which business systems or other systems they use.

“We see ourselves as an internal consulting organization and service provider, and we also act as a sounding board for our companies,” says Steen. “We’ve inherited some of it after reorganizations that we develop and manage. An example of that is a data warehouse in Azure we brought in and offer as a service. We’ve also built a complete BI platform and now, up to 80 of the group’s companies are on the BI platform. All they have to do is map their data and upload it, and then new data is refueled overnight so they can get new analytics out.”

Giving benefits

Being able to centrally create these types of resources and roll them out gives a big competitive advantage.

“Our competitors are often the same companies as our acquisition candidates,” says Steen. “These are smaller companies without a BI solution, and we’re a multi-billion-dollar group.”

But ideas also come in from acquired companies. An example is an automation flow for purchase orders that was developed for one company, which can then be offered as a service and rolled out to the other companies in the group who wish to do so.

“There we can take the cost and pay for the project if we judge that it’s possible to create a service from it,” he says.

Create your own ChatGPT

The range of automated feeds Steen’s staff can offer is something he expects will be built upon, but there are also ideas about creating an internal ChatGPT function.

“Generative AI is a new technology and everyone wonders where it will go,” he says. “But we’re thinking in terms of our platform and how we can have our own Axinter ChatGPT that we can integrate into our Microsoft environment and our BI platform. Then our integration engine in the middle can stitch it together.”

He also points out how much faster and more flexible it is to get solutions today. When the group recently had a conference for all its CEOs, the IT staff had produced a demo where they entered ChatGPT as a user in Teams and also a limited amount of unstructured data from a SharePoint. Then they let one of the company’s business areas test it by asking any question.

“We want to challenge the existing thinking that if you haven’t worked at a company for 20 or 30 years, you don’t know much about product solutions,” he says. “But the answers in our demo were spot on, and it creates a lot of thought activity for a CEO — how it can be used specifically in their industry — and that solution only took a couple of weeks for our developers to come up with using low code.”

Cloud first

Although it’s not a strict requirement, the group also works centrally for cloud first and pushes it toward acquired companies, and the choice there is Microsoft’s Azure.

Leaning on a supplier as heavily as it’s done now works well from many perspectives. Everything is connected and provides good security, says Steen. But at the same time there’s also risk.

“Sometimes you can feel almost forced to have different suppliers, but we’re quite large now and have a good dialogue, and I think we have good price control,” he says.

Collectively, the integration platform, the BI platform, and the components of Azure work together as a digital acceleration platform.

“This means we have great potential to create new automations,” he says. “That’s our strength, and with low code, it’s also easy to build. I think we have a big advantage because we can quickly come up with new solutions and we like to be at the forefront to inspire.”