In the course of the debate about suitable digitalization solutions in the water industry, it is becoming clear that planning and implementation are characterized by growing complexity. Aspects such as sensor selection, IoT, cyber security, and artificial intelligence are shaping the public debate when it comes to digitalization solutions in the water industry. However, they only represent a small part of a comprehensive and holistic package of measures for a necessary digitalization system. Rather, a functional-systemic approach and implementation method is required, in which, in addition to purely digital aspects, water management-related topics and questions of organization as well as the role of people in these processes must be answered. As a consequence of this need, the Hof University of Applied Sciences has developed a special form of a “multi-level analysis” method for the parallel survey of complex water management challenges, the identification of digitalization priorities, and the definition of an ideal starting point for the implementation of measures.