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The Services Research Company
Digital Reinvention for the Cognitive Era A Webinar Discussion with IBM and Applied Materials
June 16th , 2016
Host:
Phil Fersht, CEO & Chief Analyst, HfS [email protected]@pfersht #hfsresearch Web: www.hfsresearch.com | Blog: www.horsesforsources.com
Overview:• 20 years’ business experience in the global IT and business process
outsourcing and shared services industry
• Coined the “As-a-Service Economy” in 2014
• Industry analyst, author, speaker, strategist and blogger
• Advised and cogitated on 100’s of global IT services, BPO and shared services engagements
• Meddles with the largest global network of enterprise services and operations professionals
Career Experience:• Practice Lead, IT Services & BPO Research, Gartner, Inc
• Global BPO Marketplace Leader, Deloitte Consulting
• Consulting Practice Lead, IDC Asia/Pacific
• IT Markets Practice Lead, IDC Europe
Education:• BS with Honors in European Business & Technology, Coventry University,
United Kingdom
• Diplôme Universitaire de Technologie in Business & Technology from the University of Grenoble, France
Phil Fersht, CEO and Lead Analyst, HfS Research
• World’s largest taxi company owns no Taxis:• Uber• The most popular media owner creates no content:• Facebook• Largest accommodation provider owns to real estate:• Airbnb• Largest phone companies own no telecom infrastructure:• Skype, WeChat• World’s most valuable retailer has no inventory:• Alibaba• Fastest growing banks have no actual money:• SocietyOne• The world’s largest movie house owns no cinemas:• NetFlix• Largest software vendors don’t write the apps:• Google• The most popular emerging research firm doesn’t sell research reports:• HfS
Data is Eating our World!
2020 Vision: The “Intelligent OneOffice” will emerge
from Digital + Automation
The Digitally-Driven Front Office
Mobile, Social/Interactive, Real-time actionable data, Design Thinking
Digital Underbelly
Intelligent Automation of manual processes
Digitization of documents
IoT
Intelligent Digital Support Function
Front office-aligned IT, Finance, HR, Procurement, Supply Chain
Intelligent Digital Processes Predictive & Operational Analytics, Cognitive.
The Customer-first Digital Organization
The Enabling Intelligent OneOffice
The Nervous System,
incepting & Processing
all Inputs
The
Neural System
The
Circular System
© HfS Research 2016 (Proprietary)
Design Thinking… we must change our focus to
finding business problems
1ENVISIONING
SUCCESS
Discovering our
challenges to
re-imagine new
solution
opportunities.
2DEFINING DESIRED
OUTCOMES
Determining the
right questions
to ask of
ourselves
3PRIORITIZING
OUTCOMES
Exploring
meaningful
ways to
implement
outcomes-
based solutions
4IMPLEMENTING
OUTCOMES
Piloting initial
outcome-based
initiatives
5REALIZING
OUTCOMES
Analyze
continuous
feedback on the
solutions
provided to
measure impact
Moving into the As-a-Service Economy means changing the nature and focus of engagement between Enterprise Buyers, Service Providers, and Advisors
Journey to the As-a-Service Economy
Write Off Legacy
Brokers of Capability
Design Thinking
Collaborative Engagement
Intelligent Automation
Accessible & Actionable
Data
Holistic Security
Plug & Play Digital
Services
CHANGE MANAGEMENT IDEALS SOLUTION IDEALS
LEGACY OPERATIONS AS-A-SERVICE ECONOMYIntelligent
Simplification
Data, Security and Design Thinking Dominate
Management FocusPlease state how significant you see the “As-a-Service Economy” ideals
and the shift to more intelligent operations for your organization? (Absolutely critical / critical responses)
Source: “Intelligent Operations" Study, HfS Research 2016
Sample: Buyers = 371
15%
15%
21%
20%
19%
20%
29%
30%
20%
23%
21%
26%
27%
30%
22%
25%
35%
38%
42%
46%
46%
50%
51%
55%
Plug & Play Digital Business Services
Brokers of Capability
Write off Legacy
Intelligent Automation
Collaborative Engagement
Design Thinking
Holistic Security
Accessible & Actionable Data
Absolutely critical
Critical
The Journey has only just Begun: Huge Delta between now and
the FutureHow much progress has your enterprise made achieving each “As-a-Service” end-state today, and
where do you expect to be in 3 Years’ time, based on current investment plans and operational maturity? (% respondents answering 4 & 5)
Source: “Intelligent Operations" Study, HfS Research 2016
Sample: Buyers = 371
18%
21%
19%
23%
24%
21%
25%
23%
33%
36%
39%
39%
40%
41%
43%
47%
Plug & Play Digital Business Services
Brokers of Capability
Write off Legacy
Intelligent Automation
Collaborative Engagement
Design Thinking
Holistic Security
Accessible & Actionable Data
Today
In 3 years
Focus on Design Thinking set to drive
competitiveness across industries
Greater Urgency to Change the Model Driven From Senior
Management
How quickly will your core enterprise functions adapt to become Intelligent Operations?
6%
50%
37%
6%
2%
7%
36%
44%
9%
4%
We are already there Within 2 years Within 5 years Within 10 years Never
SVP + VP and Below
Source: “Intelligent Operations" Study, HfS Research 2016
Sample: Buyers = 371
Over half of upper management (56%) want change within 2 years
© 2016 HfS Research Ltd.
The HfS Service Buyer Summits…
www.hfsevents.com/new-york-2016
Overview Tom Reuner is Managing Director, Intelligent Automation Research at
HfS. Tom is responsible for driving the HfS research agenda for
Intelligent Automation across the whole gamut ranging from RPA to
Autonomics to Cognitive Computing and Artificial Intelligence. A key
element in Tom’s responsibilities is guiding clients and stakeholders on
the evolution of Intelligent Automation including the coverage of new
players and approaches. Furthermore, he is driving the research on
application testing and service management. A central theme for all of
his research is the increasing linkages between technological evolution
and evolution in the delivery of business processes.of business
processes.
Previous Experience Tom’s deep understanding of the dynamics of this market comes from
having held senior positions with Gartner, Ovum and KPMG
Consulting in the UK and with IDC in Germany where his
responsibilities ranged from research and consulting to business
development. He has always been involved in advising clients on the
formulation of strategies, guiding them through methodologies and
analytical data and working with clients to develop impactful and
actionable insights. Tom is frequently quoted in the leading business
and national press, appeared on TV and is a regular presenter at
conferences.
Education Tom has a PhD in History from the University of Göttingen in Germany.
Tom Reuner, Managing Director, HfS Research
Automation is in the eye of the beholder
© 2016 HfS Research
RPA is already here, now it’s time to advance the
conversation
8%
8%
8%
9%
8%
8%
10%
6%
9%
10%
17%
17%
18%
17%
19%
21%
19%
23%
23%
23%
Human Resources
Procurement
Industry-specific Process (i.e. claimsprocessing)
Sales
Supply Chain and Logistics
Customer Service / Sales Support
Marketing
Finance and Accounting
IT application maintenance & development
IT and Network infrastructure support
Full scale RPA Implementing / using RPA actively
Source: “Intelligent Operations" Study, HfS Research 2016
Sample: Buyers = 371
Tweaking the Intelligent Automation Continuum
trigger based
Characteristic of process
rules based
dynamic language
rules based
standardized language
Structured
Characteristic of data/information
Unstructured without patternsUnstructured patterned
Data Center
Automation:
Runbook
Scripting
Scheduling
Job control
Workload
automation
Process
orchestration
SOA
Virtualization
Cloud services
RPACognitive
Computing
Artificial
Intelligence
BPM
Workflow
ERP
Autonomics
Endgame: Vertically infused insights and data??!!
Insights, Data
Vertical Processes
Vertically infusedinsights and data
BPaaS, BPO as-a-stack,Industry platforms.
Machine learning,Neural networks,Enterprise search,Artificial intelligenceAnalytics
© 2016 HfS Research Ltd.
INTRODUCING THE PANEL
Overview Chris Gattenio leads the strategy, development and innovation of
Finance Consult to Operate offerings in IBM’s Business Process
Services (BPS) business. Her broad executive management
experience brings to IBM a proven track record of accelerating high-
growth businesses to success and market leadership.
Previous Experience Previously, Ms. Gattenio was Senior Vice President, Marketing and
Sales Development, for Equitant, the premier Order-to-Cash
outsourcing provider, where she successfully designed and integrated
a global strategic marketing strategy with the design and
development of a ‘clients for life’ business strategy supporting clients
such as Microsoft, Cisco, Lucent, Hewlett-Packard, Visteon and other
Global 1000 companies.
Prior to joining Equitant, Ms. Gattenio spent more than 25 years in
various executive finance, sales, and operations management
positions for such companies as The Hackett Group, National Education Corporation, and Price Waterhouse.
Christine Gattenio, VP, Business Process Services - Finance, IBM
Overview Jason Kelley provides global leadership for the solutions, design, and
innovation business in IBM’s Global Business Services. He is
responsible for working with enterprise clients to ensure IBM brings
high valued business innovation that differentiate them from their
competitors. His teams bring endless energy, creativity, and client
focused outcomes for IBM clients around the world. Shaping,
developing, and delivering unique business capability with the marriage
of analytics, automation/robotics, Watson, and cloud technologies Mr.
Kelley brings together the best of one IBM team.
Previous Experience Prior to his current role, Mr. Kelley was the CTO and design leader for
the IBM Business Process Outsourcing business and previously had
responsibility for managing IBM’s Analytics and Big Data business in
North America, China and Asia Pacific. For more than 20 years Jason
has provided collaborative executive business leadership inside and
outside of the IBM company.
Additionally, as well as founding and leading a successful marketing
services firm prior to joining the global team at IBM Mr. Kelley has continued to start new businesses within the IBM corporation.
Jason E Kelley, VP & Partner, Global Business Solutions, Design and Innovation, IBM
Overview Veronica Jones leads Global General Procurement Operations for
Applied Materials. She also focuses on innovation within Supply Chain
Strategic Programs and Systems. Her depth and breadth of experience
brings solutions to clients’ high value problems. With a zeal for Supply
Chain high performance business processes and practices, she drives
Global General Procurement to become a competitive advantage for
Applied Materials.
Mrs. Jones’ brings a high level of knowledge and insight on the
challenges and opportunities facing supply chain and supplier
management practitioners worldwide. Her background encompasses a
range of experience in areas including system implementations, start-
up operations, change management, consolidations, and outsourcing;
all while delivering value in the form of cost reductions, improved
customer experience and enhanced efficiencies attained through
process improvements
Veronica Jones, Global General Procurement (G2P), Worldwide Operations, Applied Materials
© 2016 HfS Research Ltd.
What is digital reinvention and why is it important?
Disruptive technologies are driving creation of new business models and
digital ecosystems.
Technology
forces …Analytics and cognitive CloudMobile Internet of Things
… are creating new
experiences …
Experience journey Digital ubiquity Omnichannel
… and disrupting
operational
models. Traditional value chainEcosystem
Social Security
© 2016 HfS Research Ltd.
What does a Digital Operating Model look like?
Finance Process (O2C, P2P, R2R, FP&A)
Analytics
Platform
Digital
Engagement
and Experience
Insights and KPIs
Risk and Controls Monitoring
Automation Transition Advisor
Process Modeling
Predictive Modeling
Mobile
Dashboards
Customer Self-
service Portals
Cognitive
Assists
Social
Collaboration
Enterprise
Apps
Approvals/ Alerts
Contextual
Alerts
Intelligent
Applications
Digitization of
Finance Data
CognitiveIoT SecurityCloud and Mobile Big Data
e-InvoicingElectronic Invoice
Presentation & Payment
Intelligent Data Capture
Indexing, Archiving Digital
Workflows Cognitive
Solutions
I-TVCWatson Policy
Manager
Collaboration
/ Self-service
Client
Vantage
© 2016 HfS Research Ltd.
How do you bring in Design Thinking / embed it into client
discussions?
• Radical Collaboration
• Empathy for the Enterprise
• Outcomes focused
© 2016 HfS Research Ltd.
Differentiated User Centric Thinking
Radical Collaboration Enabled Results
Value Proposition Clarity
Internal ideation to deliver innovation
As a client how have you seen design thinking work for you?
© 2016 HfS Research Ltd.
Desktop Automation
Cognitive Automation
Simple
Transactional Data
Autonomic Process
Automation (Knowledge-based)
Structured Data Unstructured Data Unstructured Data
Desktop
Automation
Robotic Process
Automation(Rules-based)
Cognitive Automation (Artificial Intelligence–based)
ERP Scripting
Workflow
Macros
Screen scraper
Auto e-mailer
Extensible & adaptive pre-built
process object libraries
Global robotic command center and
dedicated SMEs
IBM/partner resilient, secured
virtualized infrastructures
Autonomous decision making
(‘reasoning & remembering’)
New insights and data discovery
(‘learning’)
Personal and interactive support
(‘engagement’)
Insight-driven knowledge
E.g.
Industry Specific Cognitive Assist
Watson Buying Assist
Watson Perfect Order Assist
Watson Collection Assist
Robots apply insight-driven
knowledge and learns from
experience
Continuous monitoring of
process environment
E.g., Watson Policy Manager
(WPM), piloting automation of
key decision points
IBM’s Intelligent Automation Continuum caters to clients across all
stages of maturity
© 2016 HfS Research Ltd.
Progressing on the Analytics journey, how does what we have
discussed fit into the path to cognitive?
Data exploration
Prescriptive modeling
Descriptive / reporting
Predictive modeling
Data foundations
Cognitive computing
Optimized for Scale
Optimized for Innovation
Integrating data sources Assessing data quality Addressing data
governance Broadening the definition
of enterprise data
“Democratizing analytics”—facilitating access to quick insight
Building a data-driven culture in organizations
Actionable insights
Testing hypotheses
Gaining business stakeholder support and adoption
Embedding analytics into decision making processes
Tracking ROI on data-driven LoB programs
Elevating experience for maximal business benefits
Serving up real-time insight at key points of engagement
Creating “single source of truth” reporting / structured KPI’s
© 2016 HfS Research Ltd.
– The thought of just having a “vendor “ delivers a perspective of a price based, transactional, point solution. Collaborative solutioning, partnering and shared outcomes are now the focus of real business value. Pricing models are changing to reflect this.
– Talent and scale is always in flex. Effectively meeting the need of a pivoting demand requires a hybrid approach … business & IT
– Clients are looking for “consumer grade” solutions that demand an enterprise wide awareness (front, back, middle) and digital capabilities designed for delightful outcomes. Cloud, Analytics, Mobile, and Social interaction with Security is table stakes.
– Commitment to outcomes are stronger, based on unique differentiators aligned to each client’s individual culture and desired pace of change.
How are relationships are changing?
© 2016 HfS Research Ltd.
How are relationships are changing?
© 2016 HfS Research Ltd.
What types of skills do we need now versus the future?
• To what extent are the following talent requirements increasing in importance, in order to gain more value from your operations? (Increasing significantly)
32%
34%
34%
36%
36%
39%
27%
27%
29%
27%
29%
36%
Analytical prowess to improve operations /productivity
Exploring new ways of partnering across theservices ecosystem
Understanding / using digital technology toimprove business performance
Proactively identifying new ways of doing thingsthat break old habits
Understanding / using automation to improvebusiness performance
Defining business outcomes
VP and Below SVP +
Source: “Intelligent Operations" Study, HfS Research 2016
Sample: Buyers = 371
© 2016 HfS Research Ltd.
Top skills in 2020 shift to critical thinking, creativity and Emotional
Intelligence…
Source: Future of Jobs Report, World Economic Forum, 2016
© 2016 HfS Research Ltd.
Mark your calendars!
A webinar by HfS Research and IBM
Business Process re-imagination in the Cognitive Era
August 4, 2016 at 11:00am ET
hfsresear.ch/IBM-HfS-Webinar-August-4
Jason Kelley
VP & Partner, Global Business Solutions, Design and
Innovation, IBMLinkedIn
Dr. Chitra Dorai
Ph.D. IBM Fellow, Master Inventor
VP, CTO Cognitive Services, IBM Global Business
ServicesLinkedIn
© 2016 HfS Research Ltd.
“Cognitive is the destination, and digital is the necessary path to get there.”
Ginni Rometty, CEO, IBM
About HfS Research
We coined the As-a-Service Economy term because we see a profound change under way that is more all-encompassing than a simple business model or product line. It's a global shift that will leave few sectors of business or society untouched.
To help our clients and the market get to the As-a-Service Economy, we serve the strategy needs of business operations and IT leaders across finance, supply chain, human resources, marketing, and core industry functions in organizations around the world. HfS provides insightful and meaningful analyst coverage of best business practices and innovations that impact successful business outcomes, such as the digital transformation of operations, cloud-based business platforms, services talent development strategies, process automation and outsourcing, mobility, analytics and social collaboration. HfS applies its acclaimed Blueprint Methodology to evaluate the performance of service and technology in terms of innovating and executing against those business outcomes.
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