Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

By digging deep to understand consumer behaviors, needs and wants, organizations can build systems that not only meet essential user needs but also uncover new business opportunities and anticipate future requirements.

January 2018

DIGITAL BUSINESS

2

EXECUTIVE SUMMARY

Digital innovators are upending established business models across industries, from

transportation and telecommunications, to banking, entertainment and more. As products

and services become commoditized, enterprises must transform themselves and the user

experience they deliver, or face disruption and possible irrelevance.

When every bank offers about the same interest rate and financial advice, why choose

one over the other? When all video, phone and Wi-Fi connectivity is about the same, why

not just shop for a lower-priced provider every two years? And when you can summon a

self-driving car from a ride-sharing service any time you want, why care about what kind of

vehicle you own — that is, if you even own one?

Gaining, and keeping, competitive advantage in this digital world is not about jamming

every bell and whistle into a device (or an application), only for customers to abandon

them after a short time. It instead requires understanding customer needs and focusing

the digital solution on meeting those needs.

Delivering such insight-driven solutions will separate leaders from laggards in the digital

era. This report focuses on how organizations can embrace human-centered transformation

and evolve from a seller of products and services, to a provider of life-changing, human

experiences.

2

Digital Business

| Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

3Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code | 3

Digital Business

THE SHIFTING LANDSCAPE

The digital wave is proliferating with every download of a smartphone app, creation of a social media

account, tweak of a big data analytical algorithm and introduction of a new cloud service.

Mobile technology gives consumers unfettered access to information about products and services, not

merely at an individual level, but collectively from all users. Social media buzzes real-time updates on

everything from friends’ vacations to world events, providing enterprises with a “Code Halo™” of dig-

ital clues into consumers’ wants, needs and activities.1 Increasingly powerful and intelligent analytics

can sift through this data in search of insights into consumer needs, and teach itself to deliver per-

sonalized services and offers. Empowering all this is the cloud, offering more computing resources,

at lower costs, with less delay and effort than ever before possible.

These technologies have remade the business landscape and turned digital natives into giants with

global financial, and even political, clout. The power of digital has turned Uber into a transportation

leader without a fleet of vehicles, and Airbnb into a lodging giant without owning a single room.

But even greater changes are coming, including:

• A flood of new data from sources ranging from wearable sensors to social media, smart appli-

ances and industrial robots.

• Quantum leaps in the predictive capabilities of artificial intelligence (AI), allowing businesses

to more accurately anticipate customers’ needs.

• New interfaces driven by natural language technologies and virtual and augmented reality

that expand the ways customers interact with the brand, and allow enterprises to deliver compel-

ling new experiences.

• Increasingly capable autonomous devices, such as vehicles.

• The potential for distributed ledgers such as blockchain to eliminate the need for middlemen in

many industries, while creating new business models and even new currencies.

• The growing clout of “digital-first” millennials, who expect businesses to incorporate these

technologies into the brand experience.

Given the size, power and pace of these changes, it is no surprise that businesses are scrambling to

create digital-first strategies. By 2020, 50% of Global 2000 companies will see most of their business

depend on their ability to create digitally enhanced products, services and experiences, according

to market researcher IDC. By the end of 2017, IDC says revenue growth from information-based

products will be twice that of the rest of businesses’ portfolios.2 Even today, 40 of the top 100

product-based organizations are dependent on software to drive their business, says consulting firm

McKinsey & Co.3

4 | Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

Digital Business

4

Defining the ‘T’ Word

Businesses that are succeeding in this environment are using these technical and societal changes

as opportunities to create new products and services, and deliver them in new and compelling ways

(see Figure 1). They are reimagining everyday experiences from the perspective of the consumer,

unhindered by the constraints of legacy technology platforms. They are also designing solutions from

a cloud-first and mobile-first perspective, and fine-tuning them in a series of rapid iterations to ensure

every feature or function meets a real emotional, human need.

• Predictive maintenance

from IoT data, reducing

costs, increasing uptime.

• Self-driving machinery,

cutting costs, boosting

productivity.

• Agricultural analytics,

improving yields, reducing

waste.

Food Production Benefits include:

Benefits include:

Benefits include:

• Improved fitness and

health tracking,

encouraging a healthy

lifestyle.

• Earlier diagnosis of illness,

leading to better outcomes,

lower healthcare costs.

• Big data analytics to track

disease outbreaks and

potential causes, leading to

improved diagnostics and

treatments.

• Anywhere, anytime

banking and financial

information, increasing

customer satisfaction and

retention.

• Easy-to-use financial

planning and management

tools, attracting millennials

and retaining them as their

incomes rise.

• Status as trusted financial

adviser, leading to sales of

ancillary products and

services.

Financial Wellbeing

Personal Wellness

Meeting Digital Needs Across Industries

Figure 1

5Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code |

Digital Business

Turn to the social sciences (e.g., anthropology, sociology and behavioral science) to perform on-site observations of how people work, live and play, to uncover their actual needs before writing a single line of code.

TRANSFORMING THROUGH DIGITAL ENGINEERING

The first step businesses need to take is to focus not on technology but on understanding their

customers and how new technology can meet their needs in game-changing ways. Rather than the-

orizing about how customers might use the latest new gadget, businesses should turn to the social

sciences (e.g., anthropology, sociology and behavioral science) to perform on-site observations of how

people work, live and play, to uncover their actual needs before writing a single line of code. This non-

traditional, open-ended approach is meant to specifically uncover what businesses don’t already know

about the consumer. This is the first step in what we call “Insight to Code.”

For example, in our observations of communications service provider (CSP) customers, we uncovered

feelings of disconnection between parents and children, even when families were together at home,

because family members were paying more attention to their screens than to each other (see Quick

Take, next page). When we spent time with sport utility vehicle owners, we discovered that while they

wanted to bond with friends and family on adventures, they found it daunting to determine the right

location, round up the needed gear and coordinate everyone’s schedules (see Quick Take, page 8).

QUICK TAKE

Digitally Engineering a Communications Service Provider CSPs face stagnant customer satisfaction, high churn and an inordinate number of cus-tomers turning to costly human-based support rather than lower-cost digital channels. One leading CSP asked us to help identify new services that would increase brand loyalty and set it apart in an increasingly crowded marketplace.

To identify consumers’ human needs, ReD Associates, a Cognizant strategic partner, observed how families in California, Texas and Pennsylvania were using the Internet, smartphones and other devices in their daily activities. ReD discovered that customers:

• Rely on the Internet for work, education and social interactions, but have little understanding of how it works and how to safeguard and manage their connections.

• Abruptly abandon new devices such as smart watches, fitness monitors, smart appliances and virtual personal assistants, finding them too difficult to use or con-nect to one another or to cloud-based services.

• Often feel isolated from family members who are distracted by their devices, and unable to agree on how much gaming, texting, browsing and e-mail checking is acceptable.

Based on this research, we developed three minimum viable products (MVP):

• One that enables families to collaboratively agree on how much time each person may spend online, and enforces those rules on the home Wi-Fi router.

• A second that tells parents — based on their children’s smartphone location — when they fail to appear at an expected place and time, even if only to another room at home, while other family members are online.

• A third that enables the CSP to remotely connect devices, such as virtual personal assistants, smart thermostats and appliances, to each other and to capabilities such as the Spotify music streaming service.

The CSP is currently refining these MVPs for production rollout, and evaluating monetization options, including charging for the apps, selling location-based advertis-ing or collecting revenue from the sale of products and services associated with the smart devices.

6

Digital Business

| Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

7Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code |

• Referral fees for sales of guided tours, camp sites, equipment rental, etc.

• Sales of location and activity-based advertising from service and product providers.

• Subscription fees for premium versions of the application.

• Sales of data-driven insights into customer needs and behaviors to other product/service providers.

Motor Vehicle ManufacturerTrip planning/scheduling app

• Fees from third-party services for linking those services to other-wise “stranded” devices.

• Revenue-sharing with service pro-viders based on customers’ purchase of products/ services over the connected device.

• Increased sales of such devices, driven by the added convenience of the CSP handling the setup and configuration.

• Selling data-driven insights into customer needs and behaviors to other product/ service providers.

Communications Service Provider (CSP) Remote application to remotely link smart home devices to each other and to third-party services.

• Referral fees for mortgages, home inspections, attorneys and other home-related products and services.

• Sales of location and activity-based advertising from service and product providers.

• Subscription fees for premium versions of the application.

• Selling data-driven insights into customer needs and behaviors to other product/service providers.

Financial Services OrganizationInteractive, AI-guided mobile app to track spending and investments in real-time to make financial decisions based on actual spending patterns.

Potential Revenue Streams

Potential Revenue Streams

Potential Revenue Streams

The ROI of Digital Engineering

Figure 2

Digital Business

These are not fundamentally technology issues; rather, they’re human issues that can be addressed

through the proper use of technology. Meeting these needs connects organizations with customers

in ways that their competitors cannot easily match. Just as importantly, it opens the door to new

revenue streams, partnerships and business models that provide competitive differentiation (see

Figure 2).

QUICK TAKE

Applying Digital Engineering with a Global Vehicle Manufacturer As ride hailing apps tap fleets of self-driving cars to move customers from point A to point B, traditional selling points such as ride, performance and styling could become far less important to consumers. We are helping one global manufacturer remain relevant and generate revenue by meeting the needs of its sports utility vehicle (SUV) owners for adventure, self-fulfillment and increased safety and security.

In 2016, ReD Associates conducted foundational research to uncover how SUV owners use their vehicles, as well as the key barriers, life dreams, needs and values they share. In response, we created three MVPs that the manufacturer tested with consumers for two weeks. We also conducted a national survey of SUV owners to understand the com-mercial potential of each application.

8

Digital Business

| Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

The next step is to quickly turn these insights into production-ready code, review customers’ reac-

tions and iteratively tweak them to ensure they meet the human needs revealed by the social science

observations. By doing this right, organizations can deliver game-changing products and services

through applications that are:

• Cloud-native, which provides the low-cost, accelerated time-to-market and scalability required to

serve digital customers.

• Based on microservices, which makes it easier to develop and deploy new services and functions

as needed, and to access the internal and external data sources required to develop new services.

(For more on this topic, see our report “Overcoming Ongoing Digital Transformational Challenges

with a Microservices Architecture.”)

• Designed to use containers and other modern platforms, such as serverless computing, to make

the most efficient use of IT resources, and provide maximum portability across environments to

meet cost, performance, scalability and other needs. (For more on this topic, read our white paper

“Using Containers to More Effectively Manage DevOps Continuous Integration.”)

• Based on an in-depth understanding of human needs, rather than technical capabilities, so orga-

nizations can anticipate and meet customer needs their competitors cannot. (Learn more in our

white paper “Being Digital Means Being More Human.”)

• In the first area — adventure — ReD Associates found that customers were being held back by everything from the complexity of scheduling time with family and friends, to the hassles of choosing destinations, making reservations and selecting, finding and learning how to use the needed equipment. We responded with a single application that, according to early feedback, makes it easier to perform these tasks and coordinate schedules.

We’re now working with the manufacturer to identify the potential for subscription revenue; partner with providers of vacation lodging, equipment and services; and sell data gathered by the application about consumers’ needs, wants and spending habits to third parties.

• In the second area — personal enrichment — ReD Associates discovered that SUV owners wanted to identify interesting nearby activities to break out of their rou-tines, learn new skills and bond with friends and family. In this case, the MVP helped customers find the best new events, ideal routes and any equipment required to take part in the activity. We’ve also identified revenue opportunities, such as advertis-ing, sponsorship and revenue sharing with service providers, (i.e., parking garages), as well as the sale of insights about customer needs drawn from their use of the application.

• The third human need was to better coordinate and track rides, and keep tabs on their children’s location. Consumers are already using the MVP to schedule rides for family members, receive notifications when the trip has been completed and track locations. Through the app, the manufacturer is evolving into a business that can solve human problems, such as juggling work and childcare schedules. An added benefit: The app is a less intrusive way to track children’s locations than tex-ting. Revenue opportunities include partnerships with outside service providers and location-based advertising, such as a discount for a take-out meal, if a ride has been delayed and the family will not have time to prepare dinner. As security and control is one of the reasons customers buy SUVs, this also increases the perceived value of the vehicle itself.

9Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code |

Digital Business

The MVP helped customers find the best new events, ideal routes and any equipment required to take part in the activity.

10

Digital Business

| Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code

Discover customers’ human (not technical) needs

Rapidly prototype solutions

Continually iterate new apps

Move into production

Researchers observe and

describe customer interactions

with the business’s products/

services, identifying unmet

human needs.

Researchers guide developers,

creating MVPs to test how

they meet critical human

needs.

Based on user feedback, the

app is enhanced and refined

to best meet human needs.

The UI is completed, required

data links are added, and the

solution is deployed.

Insights Code Refine Deploy

3 Weeks 2 Weeks 2 Weeks 1 Week

Insight to Code: Transforming Customer Needs into Digital Solutions

Figure 3

By applying these technologies in an Agile development environment that places behavioral sci-

entists alongside developers in quick sprints, businesses can ensure that new applications contain

only features that precisely meet human needs. In our experience, this only happens when require-

ments-gathering and testing phases are not isolated events. In our engagements, researchers work

alongside developers to create MVPs that can be quickly evaluated by users, adapted as needed

and deployed in production environments to achieve first-mover advantage in emerging spaces (see

Figure 3).

ONLY THE BEGINNING

No one can predict how tomorrow’s consumers will react to future technologies such as self-driving

cars, blockchain and virtual reality. The most effective way to meet ongoing competitive challenges

and capture market opportunities is to continually understand people’s human needs, and quickly

deliver applications that meet them.

By combining in-depth ethnographic research with ultra-agile development, businesses can:

1. Confidently invest: With the ability to continually validate new ideas with actual human

insights, businesses can more confidently choose which new products, applications and services

to invest in.

11Digital Engineering: Combining Computer Science with Social Science to Translate Human Insights into Precision Code |

Digital Business

Sowri Santhanakrishnan Senior Vice-President, Head of Digital Engineering Practice, Cognizant Digital Business

Sowri Santhanakrishnan is Senior Vice-President at Cognizant

Digital Business, heading the company’s Digital Engineering

Practice. He has 20-plus years of experience building and direct-

ing global business and technology operations. In this role, Sowri

works with Global 1000 companies to digitally transform their

business by combining strategy, technology and industry expertise

that enables businesses to improve their services and products,

create an omni-channel digital experience, and gain a competi-

tive market advantage across the digital stack: mobile, social, big

data, cloud and the Internet of Things. He can be reached at

sowris@cognizant.com | www.linkedin.com/in/sowris/.

ABOUT THE AUTHOR

FOOTNOTES

1 For more on Code Halos, visit our website, www.futureofwork.com/codehalo.

2 “IDC FutureScape: Worldwide IT Industry 2017 Predictions,” IDC, November 2016, www.idc.com/getdoc.jsp?container-

Id=US41883016.

3 “An Executive’s Guide to Software Development,” McKinsey & Co., February 2017, www.mckinsey.com/business-functions/

digital-mckinsey/our-insights/an-executives-guide-to-software-development.

2. Eliminate waste: Putting human insights at the center of technology development reduces the

development cycles required to tweak code to meet market needs, and eliminates the production

of applications that fail to gain customer acceptance. The use of cloud-native technologies speeds

time to market, allows businesses to buy only the IT capacity they need and automates costly

manual IT management processes.

3. Compete in the digital economy: Applying consumer insights to the creation of production-ready

code is the most direct path to competitive advantage in any industry. Applying the Insight to Code

method positions businesses to create sustainable competitive advantage, and even create new

markets and business models, in today’s digital economy.

ABOUT COGNIZANT

Cognizant (NASDAQ-100: CTSH) is one of the world’s leading professional services companies, transforming clients’ business, operating and technology models for the digital era. Our unique industry-based, consultative approach helps clients envision, build and run more innova-tive and efficient businesses. Headquartered in the U.S., Cognizant is ranked 205 on the Fortune 500 and is consistently listed among the most admired companies in the world. Learn how Cognizant helps clients lead with digital at www.cognizant.com or follow us @Cognizant.

ABOUT COGNIZANT DIGITAL BUSINESS

Cognizant Digital Business helps our clients imagine and build the Digital Economy. We do this by bringing together human insight, digital strategy, industry knowledge, design, and new technologies to create new experiences and launch new business models. For more informa-tion, please visit www.cognizant.com/digital or join the conversation on LinkedIn.

© Copyright 2017, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by any means,electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein is subject to change without notice. All other trademarks mentioned herein are the property of their respective owners.

TL Codex 3218

World Headquarters

500 Frank W. Burr Blvd.Teaneck, NJ 07666 USAPhone: +1 201 801 0233Fax: +1 201 801 0243Toll Free: +1 888 937 3277

European Headquarters

1 Kingdom Street Paddington Central London W2 6BD EnglandPhone: +44 (0) 20 7297 7600 Fax: +44 (0) 20 7121 0102

India Operations Headquarters

#5/535 Old Mahabalipuram RoadOkkiyam Pettai, ThoraipakkamChennai, 600 096 IndiaPhone: +91 (0) 44 4209 6000Fax: +91 (0) 44 4209 6060