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Digital Transformation and IOT

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Digital Transformation and IOT presentation delivered at techitout 2016 in Springfield, MO Oct 20, 2016

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Digital Transformation and IOT

  1. 1. techITout Technology Showcase and Expo Springfield, MO 2016 Digital Transformation and the Internet of Things
  2. 2. Questions • How many of you are IT team, staff or leadership? • How many of you are business? (Marketing, Operations, Sales, Finance, etc.) • How many of you can define or think you can define digital transformation? • How many of you have led a digital transformation initiative? • How many of you are in the midst of a digital transformation initiative?
  3. 3. Digital Transformation The term ‘digital transformation’ has been used to describe anything from creating a fully responsive mobile website to developing a social media strategy, but in reality true transformation needs to involve much more than just the end product. https://www.marketingweek.com/2016/04/14/what-does-digital-transformation-really-mean/
  4. 4. Terms • Business Innovation • Digital Experience • Digital Strategy • Digital Disruption • Disruptive Innovation • Disruptive Technologies
  5. 5. Business Innovation • Business innovation is an organization's process for introducing new ideas, workflows, methodologies, services or products. • Business innovation should enable the achievement of goals across the entire organization, with sights set on accomplishing core business aims and initiatives. • Innovation often begins with idea generation, wherein ideas are narrowed down during brainstorming sessions after which leaders consider the business viability, feasibility and desirability of each idea.
  6. 6. Digital Experience • A digital experience is the way in which a user interacts with content on the web and how a user can achieve a goal on the web. • Digital experience not only means reading and consuming content but interacting with web content. • A good digital experience is when a user feels connected to the content and tools that they use on the web. Also, nowadays digital experiences are spread across a multitude of devices and platforms.
  7. 7. Digital Strategy • A digital strategy is a form of strategic management and a business answer or response to a digital question, often best addressed as part of an overall business strategy. • A digital strategy is often characterized by the application of new technologies to existing business activityand/or a focus on the enablement of new digital capabilities to their business. • Formulation often includes the process of specifying an organization's vision, goals, opportunities and related activities in order to maximize the business benefits of digital initiatives to an organization.
  8. 8. Digital Disruption • Digital disruption is the change that occurs when new digital technologies and business models affect the value proposition of existing goods and services. • The rapid increase in the use of of mobile devices for personal use and work, has increased the potential for digital disruption across many industries. • A powerful example is the way Amazon, Netflix and Hulu Plus have disrupted the media and entertainment industries by changing how content is accessed by customers and monetized by advertisers. • It is often confused with the term disruptive technology.
  9. 9. Disruptive Innovation • A disruptive innovation is an innovation that creates a new market and value network and eventually disrupts an existing market and value network, displacing established market leading firms, products and alliances. • Not all innovations are disruptive, even if they are revolutionary. For example, the first automobiles in the late 19th century were not a disruptive innovation, because early automobiles were expensive luxury items that did not disrupt the market for horse-drawn vehicles. • The market for transportation essentially remained intact until the debut of the lower-priced Ford Model T in 1908. The mass- produced automobile was a disruptive innovation, because it changed the transportation market, whereas the first thirty years of automobiles did not. The term was defined and phenomenon analyzed by Clayton M. Christensen beginning in 1995
  10. 10. Disruptive Technologies • Term coined by Harvard Business School professor Clayton M. Christensen to describe a new technology that displaces an established technology • A disruptive technology is one that displaces an established technology and shakes up the industry or a ground-breaking product that creates a completely new industry. • Here are a few examples of disruptive technologies: • The personal computer (PC) displaced the typewriter and forever changed the way we work and communicate. • The Windows operating system's combination of affordability and a user-friendly interface was instrumental in the rapid development of the personal computing industry in the 1990s. Personal computing disrupted the television industry, as well as a great number of other activities. • Email transformed the way we communicating, largely displacing letter-writing and disrupting the postal and greeting card industries.
  11. 11. Digital Transformation Digital transformation is the profound and accelerating transformation of business activities, processes, competencies and models to fully leverage the changes and opportunities of digital technologies and their impact across society in a strategic and prioritized way. http://www.i-scoop.eu/digital-transformation/
  12. 12. Digital Transformation • CapGemini Consulting was one of the first to come up with the concept of digital transformation and a digital transformation framework. • They did so in collaboration with the ‘MIT Center for Digital Business‘ during a three-year study which defined an effective digital transformation program as one that looked at the what and the how. http://www.i-scoop.eu/digital-transformation/
  13. 13. Digital Transformation “To be clear, investing in technology to stay current or ahead of the curve isn't the same thing. Pretty much every company is putting money into new tools, platforms, and services. And, doing so is a matter of becoming tech-enabled, which doesn’t mean companies are actually changing to compete in a digital economy. With digital transformation, however, technology is driven by purpose, and that purpose is meant to reshape business.” (emphasis mine) I define it this way... The realignment of, or new investment in, technology, business models, and processes to more effectively compete in an ever-changing digital economy. Brian Solis, Principal Analyst, Altimeter Group
  14. 14. Digital Transformation • Digital transformation may be thought of as the third stage of embracing digital technologies: digital competence → digital usage → digital transformation. • The transformation stage means that digital usages inherently enable new types of innovation and creativity in a particular domain, rather than simply enhance and support the traditional methods. Digital literacies: concepts, policies and practices By Colin Lankshear, Michele Knobel, 2008, p. 173
  15. 15. Digital Transformation • Some authors have posited that rapid advances in six primary areas have converged to create the “era of digital transformation”: • Hardware • Software • Networks (cables, wireless and social) • Commercial and consumer comprehension • Democratization of technology at scale (low costs & mass adoption)
  16. 16. Digital Transformation • The evolutionary path to digital transformation followed a timeline that included the invention and development of the following: • Computers • Memory and data storage • Mass adoption of PCs and laptops • Local Networks • ERPs • The internet • Mobile networks and mobile phones • GPS • Mass global adoption of wireless devices (laptops, mobile phones, tablets, smartphones, wearables, sensors) • Proliferation of websites and online activity • Rapid adoption and expansion of online and mobile databases and search • Rapid adoption and expansion of online marketplaces and reviews
  17. 17. Five Domains of Digital Transformation • Customers • Competition • Data • Innovation • Value Across these five domains, digital technologies are redefining many of the underlying principles of strategy and changing the rules by which companies must operate in order to succeed. Many old constraints have been lifted, and new possibilities are now available. Rogers, David L.. The Digital Transformation Playbook: Rethink Your Business for the Digital Age (Columbia Business School Publishing) (pp. 5-6). Columbia University Press. Kindle Edition.
  18. 18. Digital Transformation Four digital transformation realities to emphasize: • Business/IT relationship is key (closing the gap between both, focusing on the same goals and NOT overlooking the role of IT). • There is a common DNA among digital leaders and the path to digital transformation shows common traits (even if context matters). • As said, each industry is impacted, including your industry. Customers, employees, partners, nor competitors or new, disruptive players, will wait for business to catch up, regardless of industry. • Digital transformation is led from the top (or at least requires firm buy-in from the top – and all stakeholders).
  19. 19. Myths vs. Facts Myth Reality Digital is primarily about the customer experience Huge opportunities exist also in effeciency, productivity and employee leverage Digital primarily matters only to technology or B2C companies Opportunities exist in ALL industries, NO exceptions Let a thousand flowers bloom; bottom up activity is the right way to change Digital transformation must be led from the top If we do enough digital initiatives we will get there Transformation management intensity is more important for driving overall performance Digital transformation will happen despite our IT Business / IT relationships are key, and in many companies they must be improved Digital transforamtion approaches are different for every industry and company Digital leaders exhibit a common DNA In our industry, we can wait and see how digital develops There are digital leaders outperforming their peers in every industry today
  20. 20. Digital Transformation Maturity Model
  21. 21. Digital Transformation Maturity Model
  22. 22. Internet of Things (IOT)
  23. 23. Questions • Have many of you think you can define or understand IOT? • How many of you work in an organization gathering data from multiple sensors? • How many of you work in an environment using HDInsight, HADOOP or other big data products? • How many of you work in an environment where you are doing advanced predictive analytics? • How many of you are working in an environment where you are doing an IOT project or Proof of Concept?
  24. 24. What IS this thing called Internet of Things (IOT) We gather up your data, then we shake it all about, We do the hokey pokey and we turn ourselves around, That’s what it’s all about!!!
  25. 25. The Internet of Things (IoT) is key to achieving digital transformation Source: Redefining the Connected Conversation, IoT Trends, Challenges & Experience Survey. James Brehm & Associates, 2016. 60% Of those working on IoT are aiming to grow revenue and profits 73% Of the companies surveyed are currently active in IoT 50% Reduction in downtime with predictive maintenance According to a recent IoT survey…
  26. 26. Digital transformation hinges on four imperatives Engage your customers Empower your employees Optimize your operations Transform your products Systems of Intelligence
  27. 27. Digital transformation is rapidly reshaping the landscape Sources: 1McKinsey, How IoT Can Support A Dynamic Maintenance Program, 2016 2IDC, 2016 ~80% margin1 driven by apps, analytics, and services in 2020 Average increase in income for the most digitally transformed enterprises $100M 2020 2009 30B Things Income Intelligence “Every business will become a software business, build applications, use advanced analytics and provide SaaS services.“ Satya Nadella 2 2
  28. 28. “The growth in IoT will far exceed that of other connected devices. By 2020, the number of smartphones tablets and PCs in use will reach about 7.3 billion units” Peter Middleton, Research Director, Gartner http://www.gartner.com/newsroom/id/2636073
  29. 29. 70% of value enabled by IoT will come from B2B scenarios McKinsey & Company 25 billion Connected “things” by 2020 —Gartner $1.7 trillion Market for IoT by 2020 —IDC Internet of Things opportunity
  30. 30. IoT is already delivering tangible results across industries Gathers data from sensors and systems to create valuable business intelligence and reduce downtime by 50% Cutting fuel usage by 1 percent could save $250,000 per plane per year Chillers now run 9x faster than unconnected equipment, avoiding more than $300,000 in hourly downtime costs Improves access to production and supply chain data worldwide, reducing downtime costs by as much as $300,000 per day
  31. 31. Innovation at work – real IoT use cases Electric charging stations Street sweepers Postboxes Aircrafts Auto Elevators Factory floor Oil equipment Cows Engines Vending machines Buildings Fryers Medical devices Vaccine dispensers Trucks BusesDogs Oil distribution Smart meters IoT Power plant Surveillance Power tools Racing Mining equipment Smart grids
  32. 32. History June 22, 2009 Kevin Ashton writes in “That ‘Internet of Things’ Thing” in RFID Journal: “I could be wrong, but I’m fairly sure the phrase ‘Internet of Things’ started life as the title of a presentation I made at Procter & Gamble (P&G) in 1999. Linking the new idea of RFID in P&G’s supply chain to the then-red-hot topic of the Internet was more than just a good way to get executive attention. It summed up an important insight—one that 10 years later, after the Internet of Things has become the title of everything from an article in Scientific American to the name of a European Union conference, is still often misunderstood.”
  33. 33. Myths and Realities Myth Reality IOT is only machine to machine centered Communication can be not only between machines, but from a variety of other hosts and systems IOT is only about "things" The real magic is in the data, and how data is analyazed and used IOT is just about sensors or big data Maintenance and management of IoT devices and other devices that communicate with them is also internet of things. IoT Standards is non existent There are many standards that control and restrict the development of IoT applications. Internet of Things security concern will always remain The development of new IoT standards like communication protocol TLS are actively addressing these issues. IoT Devices will be part of one family Most of the devices will be standalone or will have accompanying cloud based services from the same vendor. Wireless connectivity is must for IoT devices Not necessarily all IoT devices should be wireless they can also be linked through Ethernet or USB connections. IoT development is easier Getting your device up and running is just tip of the ice berg that can be achieved with any IoT development kit in few hours. However the real challenge is to get your device connect with other devices, monetize its operation and all of this while maintaining security and reliability.
  34. 34. Connectivity Data AnalyticsThings Action Defining Internet of Things
  35. 35. • Digital Nervous System • Eyes & EarsSensors • Inputs are digitized • Put onto networksConnectivity • Inputs combined into bi-directional systems • Integrate data, people, processes & systems • Better decision making People & Processes
  36. 36. • Descriptive Analytics • Diagnostic Analytics • Prescriptive Analytics • Predictive Analytics Analytics • Ad Hoc Reporting • Power BI • DashboardsReporting
  37. 37. Capitalizing on IoT Connect your things Turn data into insights Transform your business
  38. 38. CIO Priorities – Gartner - 2016 Priority Technology 1 BI / Analytics 2 Cloud 3 Mobile 4 Digitization / Digital Marketing 5 Infrastrucuture and Data Center 6 ERP 7 Security 8 Industry Specific Applications 9 CRM 10 Networking / Voice / Data Communications
  39. 39. Top Ten Technologies (Gartner) • IOT Security • IOT Analytics • IOT Device (Thing) management • Low-Power, Short Range IOT Networks • Low-Power, Wide-Area Networks • IOT Processors • IOT Operating Systems • Event Stream Processing • IOT Platforms • IOT Standards and Ecosystems
  40. 40. Gartner Hype Cycle Emerging Technologies 2016
  41. 41. Gartner Hype Cycle Emerging Technologies 2016 • Gartner added 16 new technologies to the Hype Cycle this year, including blockchain, machine learning, general purpose machine intelligence, smart workspace for the first time. • Smart machine technologies will be the most disruptive class of innovations over the next 10 years due to their computational power, scalability in analyzing large-scale data sets, and rapid advances in neural networks. • Gartner clients are seeing machine learning deliver benefits, scale across their enterprises, and create high expectations of future value which contribute to its position on the Hype Cycle this year.
  42. 42. IOT Business Value The Internet of Things is quickly becoming one of the most-hyped technologies in IT circles -- the big data term of the moment. But as the concept of the IoT becomes more familiar, how businesses can derive value from it is a question that needs to be answered. And increasingly, analytics is seen as the key to making investments in IoT technology worthwhile. Tech Target - IOT Agenda
  43. 43. IOT Business Value Much of the talk about the Internet of Things (IoT) focuses on the “things” themselves – wearables, sensors, iBeacons, and other network-connected machines. However, the greatest value for organizations comes from combining the data generated by these devices with other customer or operational data to uncover insights and establish predictive models. This is the incredible promise of IoT, but without the ability to link data from the smart, networked “things” with other business data, its value is limited. Scott Hedrick - Informatica
  44. 44. Maturity Model
  45. 45. Technologies SharePoint 2016 Microsoft Dynamics SQL Server .NET Framework Microsoft Azure / IOT HTML5 + CSS3 Office 365 SharePoint Toolkit
  46. 46. Questions?

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