Digital and

Operational

Transformation:

A Roadmap to Drive Disruption

Globe North

Digital is

transforming our

world…

At home

On our commute

At work

Bot Career Path – on the fast track

• Automation is moving incredibly fast up the capability curve

• As machine intelligence improves, the type and number of

“robotic” tasks that can be turned over to them increases,

freeing up humans to focus on human work.

Data DecisionAnalysis Precision

Developer

Bot

Analyst

Bot

Chatbot

Data

Entry Bot

Artificial Intelligence

Deep Learning

Machine Learning

Natural Language Processing

Autonomics

Robotic Process Automation

Scripting

Inst

ruct

ive

Ad

ap

tive

Co

gn

itiv

e

AI Value Trend

Biz Value of AI Will Pass $1 Trillion This Year

By John K. Waters04/30/2018

The total business value derived from artificial intelligence (AI) is going to

reach $1.2 trillion this year, industry watchers at Gartner believe. That's

an increase of 70 percent over last year across all enterprise vertical

sectors, globally, that the analyst firm covers. Gartner also expects that

number to reach $3.9 trillion by 2022.0

500

1000

1500

2000

2500

3000

3500

4000

2017 2018 2022

$B

Digital Disruption has upended whole

industries - and launched new ones

What is the likelihood of

your organization being

“digitally disrupted?”

Market

Guide to

Digital

Disruption

Source: Accenture Digital, Feb. 2018

“Every industry debates whether the Internet will disrupt their business. In the

beginning, everyone says, ‘No, no—our

business is safe.’ But it’s only a matter of time before digital disrupts every industry

that exists in our economy.”- Aaron Shapiro, CEO of digital agency Huge

Example: Amazon Goes Grocery Shopping

Following its $200 million acquisition of meal kit startup Plated last fall, grocery chain Albertsons announced this week it would roll out Plated’s meal kits to hundreds of stores by the end of 2018. The meal kits will also be made available for 2-hour delivery through Instacart, same-day and scheduled home delivery, and for in-store pickup through Albertsons Companies Drive Up and Go service. While Albertsons’ acquisition of a meal kit startup was a first for a national grocery chain, it’s becoming clear that meal kit options are becoming a baseline for grocery competitors across the board as they prepare to battle with the likes of Amazon and Walmart, Blue Apron and more.

Albertsons will offer Plated’s meal kits across hundreds of stores this yearSarah Perez@sarahintampa / Apr 6, 2018

The 4 Ways Amazon Has Changed Whole FoodsNatalie Walters, The Moteley Fool / Apr 25, 2018 at 8:02PMAmazon (NASDAQ:AMZN) CEO Jeff Bezos excited the company's 100 million Prime members last week by saying they could expect more benefits at Whole Foods in the future.Bezos' comments came in his annual letter to shareholders, sent on April 18. He wrote that the company had started "the technical work" needed to bring more perks to Prime members who shop at Whole Foods.Exciting changes have already rolled out since Amazon scooped up the grocer last June. Some benefits are for Prime members only, while others are available to everyone.

1. Amazon lowered prices at Whole Foods -- twice! 2. Amazon started free two-hour delivery from Whole Foods 3. Amazon displayed Alexa devices at Whole Foods4. Amazon offers pickup and return of its shipments at Whole Foods

6/11/2018Copyright Globe North, LLC 2018 All rights reserved.

12

Is this a Threat or an Opportunity?

• The Threat: Amazon plans to mine data of consumer grocery spending from Whole Food’s vast database. The goal is to cost-effectively and automatically deliver the foods you buy each week to your door. Supermarkets need a way to differentiate themselves or they will gradually go the way of the video stores and large department stores.

• The Opportunity: Many consumers will opt for an online buying service, but many will not. There will emerge even more convenient options that will be more appealing. Supermarkets need to understand how the “On Demand” generation will want to adapt to this changing marketplace.

The answer: Both

Digital Acuity is the ability to see both digital threats and opportunities.

But what does it really

mean to “go digital?”

Example: Banking Goes Digital

• Nearly 50% of WeChat’s billion users have now paid at a retail store using a QR code, while Alipay (with another 500 million users) is

seeking to bypass the phone entirely with its “pay with a smile” facial recognition system.

• According to 79% of bankers, collaborative robots (cobots) will be

working alongside humans in their banks within two years, and will

eventually be the first point of contact for most bank-customer

interactions.

• 70% of bankers say blockchain will become a critical technology

within the next three years. The distributed ledger technology can

also facilitate ‘plug and play’ architecture that can help banks decommission many legacy systems.

What's Next? 5 Technology Trends That Will Shape Retail And Commercial Banking

Alan McIntyre, Forbes April 30 2018

Is this a Threat or an Opportunity?

• The Threat: Worldwide banks are facing disruption from new vehicles for payment. We are rapidly ,moving to a card-less, cashless society. According to a recent survey from the Boston Consulting Group (BCG), profits among the world’s corporate banking institutions is significantly declining – but digitization could halt that trend.

• The Opportunity: In 2017, the top 3 U.S. banks controlled 32% of deposits, up

from 20% in 2007, and also took 50% of new account openings. Alternative lending firm Kabbage recently found that mobile lending is on the rise among small businesses, with a more than 360 percent increase in the number of SMB loans accessed via mobile device between April 2014 and February 2018. The answer: Both

Digital Agility is the ability to rapidly pivot to and scale new technologies.c

“The financial stakes are very high. Over the next five years, we expect 30 percent of traditional corporate banking revenues to be accessible solely through digital channels.”- BCG senior partner Dr. Carsten Baumgärtner

How do you make a

coherent “digital strategy” out of all this?

RPA

Machine Learning

Artificial Intelligence

Internet of Things

Web

Mobility

Apps

Data

VR/ AR

Cloud

Analytics

XaaS

Applications

NLP

Autonomics

Blockchain

HCI

“Banking has reached an inflection point with the merging of financial services and technology, or FinTech. But innovation can’t be fueled by technology alone. Our customers are crucial to the ideation and creation process, so we’ve included them since day one and are always looking for new and better ways to incorporate their insights as we design our digital products. This co-creation process is now at the heart of everything we do.”- Carey Kolaja, Global Chief Product Officer for Citi FinTech

Start with what isn’t changing - Customer

Customer

Experience

Design Thinking begins with the end user’s experience in mind.

Start with what isn’t changing - Process

“My top priority is to deliver a successful no- and low-touch experience, establishing digital as the one channel for the entire customer lifecycle. Eighty percent of our customers want digital access, which is why our highest priority for transformation this year is to create an even-better customer experience — one with more transparency and a streamlined purchase path.”- Bertram Schulte, Chief Digital Officer SAP

Lean

Design

Process is at the front end of Smart Automation.

Start with what isn’t changing - Culture

“First, foundation – what do we have to do to enable the technology platform

that supports change? Second, leadership – the skills, the innovation and

the culture that are required to get transformational change. And finally,

digital services – that’s service redesign and it’s about fundamentally shifting our core design principles, so we focus on user experience.”- Martyn Wallace, CDO Scottish Local Government Digital Office

Strategy•Anticipate digital threats

•Seize digital opportunities

Capability

•Adopt and scale new technologies.

•Partner to complement core digital capability

Culture•Hire/promote digital talent

•Encourage & incent constant innovation

Digital Acuity

Digital Agility

Digital Affinity

Digital Affinity is comfort with and aptitude for human / digital collaboration.

Digital

Transformation

Keyboard

Top 5 wrong turns on

the digital journey

5. Focusing on technology vs. people and process

4. Failure to develop critical internal competencies

3. Taking an a-strategic approach and expecting material impact

2. Believing the hype

1. Not believing the hype

Digital

Transformation

Cycle

Customer

Concept

CapabilityCompetency

Capacity

Successful Digital Transformation

continuously cycles, working out from

customer needs - imagining new capabilities,

experiences, services, and business models –developing and deploying them at scale.

From Customer Need to Concept

Learning

Insight

Capability

Personalization

Accuracy

Speed

Reach

Scale

Intelligent Automation

Analytics

Inte

rne

t of T

hin

gs

Blo

ckch

ain

Cloud

Big Data

Services / Apps / Roles

Mo

bility

Inte

rface

s

From Concept to Capacity

Key Decisions

• What problem to solve

• Which tools to employ

• Build, buy or partner

• How fast to go

Customer Experience

Current Process

Needs & Pain Points

Use Case

or Problem

Digital Enablers

Proof of Value

Customer Need

Capability

Operating

Model

Build /Buy Acquire

Business

Plan

Competency

Customer Value Required

Digital Capability Needed

Sourcing Model Preferred

Engage Stakeholders

Mobilize

Resources

Launch & Scale

Capcity

Deployment Approach Selected

Threat or Opportunity

Desired Outcome

Applications

Scripts

Workflow

API’sRPA

Cognitive

Machine Learning

NLP

Artificial Intelligence

Smart Process & Automation

• Value

• Strategy

• Enablement

Roadmap

• Opportunity

• Prioritization

• Assessment

Pipeline• Eliminate

• Simplify

• Automate

Results

• What we automate is a process.

• How we automate is a process.

• Deciding what to automate is a process.

•

Summary

• Digital transformation is sweeping through every industry, opening up remarkable new possibilities and posing existential challenges.

• Organizations must be acute in their market scans, sensing threats and agile in seizing opportunities.

• To make sense of the dynamic digital landscape, start with what’s not changing - the primacy of customer, process and culture.

• Digital transformation is not a journey to one place, it is a continuous cycling, bringing to bear new capabilities and creating new value.

• Smart Automation starts with a focus on process, leverages the right technology and provides the needed level of improvement within the required timeframe.

Copyright 2018 Globe North, LLC All rights reserved.

Globe North has decades of global experience

successfully leading:

• Enterprise Transformation

• Process and Automation

• Change Management

We help organizations zoom out, see the big

picture, capitalize on new technology and take

organization performance to the next level.

gregory.north@globenorth.com

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Transformation is a journey...

you’re going to need a roadmap.