EMEAR IoT RF Accenture Keynote session

Platform EconomyBodo KoerberManaging DirectorDigital Enterprise & Industrial Internet of Things

People First:The Primacy of People in the Digital Age

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Intelligent Automation

Liquid Workforce

Platform Economy

Predictable Disruption

Digital Trust

The Accenture Technology Vision 2016 identifies five technology trends fueled by the people first principle and that are essential to business success in the digital economy.

Interconnected Platform of Platforms

Connected world enables new ecosystems across industries faster than ever before

Smart Appliance &Industrial Equipment

Telecom

Smart Home/Buildings/Spaces

Energy Provider

Connected Product

Mobile experiences have led the way …

Transact payments for goods & services

Download 3rd party apps

Personalize your device

Ongoing relationship with manufacturer

Access new services

Get Updates for security & functionality

Connected Product

… but are just as relevant in other sectors

Download 3rd party apps

Personalize your device

Access new services Transact payments for goods & services

Ongoing relationship with manufacturer

Get Updates for security & functionality

Industrial IoT adds incremental value in the near term but becomes transformative over the long-term

OperationalEfficiency

• Asset utilization• Operational cost reduction• Improvement worker

productivity, safety and working conditions

From Product to

New Product & Services

• New business models• Pay per use• Software based services• Product / Service hybrids• Data monetization

Service

Autonomous Pull Economy

• Continuous demand-sensing• End to end automation• Resource optimization & waste

reduction

Pull

Outcome-basedEconomy

• Pay per outcome• New connected ecosystems• Platform-enabled marketplace• Industry blur

Outcome

New technology platforms are driving business innovation, everywhere

7

Driving a geographic dispersion of technology innovation hubs

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Building these types of new platforms requires starting from the ground up

8Copyright © 2016 Accenture. All rights reserved.

This includes:Technical Architecture

Governance

Security

How?Create open standards and APIs to be sharable and attractive to ecosystem partners.

Use a cloud foundation, technically designed to scale with the network effects of the ecosystem.

Back office systems will need to support real-time business models


SAP HANA real-time health analytics and predictive medicine

As these ecosystems develop more connections to mobile and IoT devices, platforms need to support real-time business models and data architectures

Real-time is the basis for connected intelligent machines, vehicles, and mission-critical facilities

Key enabler = in memory computing & databases

Real-time use cases abound in consumer smartphone appsSocial/Facebook: share experiences instantly

Transportation/Uber: watch your taxi navigating toward you

Connected Car: infotainment and on-demand services

Chat apps: instant group communications with no latency

Smart home: the lights turn when you walk in the house

TV remote: change the channel from your smartphone

And are driving the next generation of mission critical systemsHealthcare: continuous patient monitoring hospital to home

Industrial: real-time management of $ billions of critical assets

Logistics: real-time tracking of every that moves

Energy: smart grid electricity usage, optimization, and security

Connected Car: emergency services alerted instantly upon collision

Transportation: driverless vehicles of all kinds

Real-time use cases abound in the consumer experience and are rapidly expanding into all business sectors


These new platforms also = adoption of New IT


Multi-speed change engine

Managing platforms and ecosystems of digital partners and developers communities will drive your New IT into high gear

New IT extends into platform ecosystem governance to support your ecosystem

Digital business partners

Developer communities

Cloud partners

Security partners

Architected / designed for continuous change

Agile (Release/Change Management):

DevOps (Process, People & Tools)

Testing (Rapid, Ecosystem-based)

By 2018, over 60% of new apps will use cloud-enabled continuous delivery and cloud-native application architectures to enable faster innovation and business agility.IDC FutureScape: Worldwide Cloud 2016 Predictions, IDC, Doc #259840, November 4, 2015

Once in place, enterprises will use these platforms as new types of business models


“Products have features. Platforms have communities”

Marshall Van AlstyneMIT Initiative of the Digital Economy

Co-author, Platform Revolution, (to be released March 2016)Connected Collaborative Scalable

Platform business models are:

… business strategies based on creating value externally with communities of users, partners, and developers

Tech Companies and Born- Digital Organizations

AlibabaAlphabetAmazon.comAppleBaidueBayFacebookJD.comLinkedInNetflixPriceline.comSalesforceTencentTwitterYahoo!

InternetCompanies

$16,752

+15,187.1%

PlatformCompanies

$2,560,902Internet Companies

AppleAxel SpringerCopartFox CommunicationsIAC/InterActive Corp.iLiveiStart InternetLive MicrosystemsNetcom OnlineNetscapePSINetRentPathStorage Computer Corp.Wave CorporationWeb.com

Tech companies & born digital organizations are dominating the digital economy with platform business models

Private venture-backed startups are also driving record-high valuations:

More than 140 ‘unicorns’ (private companies with valuations of $1 billions or more) have a total market cap of over $500 billion (“The Unicorn List,” CB Insights, 2015)

70% of ‘unicorn’ startups are platform companies(Center for Global Enterprise, 2015)

Using platforms is the business model- Is anyone successfully doing this?

Market Cap Valuations –Internet vs. Platform CompaniesMarket Cap of Top 15 Public Platform Companies:

$2.6 trillion

Market Cap of Private ‘Unicorn’ Companies: $500 billion

TOTAL: $3+ trillion

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1995 2015

$MM

As a leader in the digital revolution for healthcare, Philips is launching Philips HealthSuite platform with 3 tech partners:

Salesforce.com

Amazon IoT

Alibaba Cloud.

With a platform business model Philips is driving new growth paths that complement its core business in medical equipment.

The platform business model lives alongside the traditional product business

Companies are using their platforms to lead in the digital revolution


This is a big picture change

Traditional Value-Chain Business Models

Value creation is two-way and continuous

Value creation is linear and one-way

Platform-Driven Business Models

DevelopersPublishersContent ownersRetailServices

Platform EcosystemProduction Distribution Marketing Consumer


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Supply Chain Logistics – End-to-end visibility

Distribution Center Config & Pack

• FG Inventory• Configuration• Packing

Arrival

• Break Bulk• Cross Dock• FG Inventory• Kit

Customer DCs

DistributorDischarged

Departure

Arrival

Direct Ship

• Forecast, Sales Orders• Goods Receipts• Inventory of New & Returned

Goods• Dispatch to Retailers

Distributors

Customer/ Retailer

On-hand

• Point of Sale, Sell-thru• Inventory• Returns, Post-Sales

Suppliers

• Component inventory• Builds Base Assemblies• WIP• Creates Shipment

Suppliers

Manufacturing

• Receives PO• Confirms PO• Component Inventory• Ship components

ManufacturerIn or Out-Source

3PL Logistics• Freight Forwarding• Customs Clearance• Consolidation• FG Inventory

ArrivalDeparture

Downstream and upstream visibility of movement of goods through the supply chain

Copyright © 2016 Accenture. All rights reserved.Source: Market & Markets, Intel

Having a platform strategy and the business know-how to exploit it is more important than “owning” an ecosystem.

By 2018, IDC predicts that more than 50% of large enterprises – and more than 80% of enterprises with advanced digital transformation strategies – will create and/or partner with industry platforms.1

IDC predicts that the number of industry clouds will reach 500 or more by 2018, up from today's 100-plus.2

Digital leaders from non-tech sectors are now also building platforms

1 “IDC Predicts the Emergence of "the DX Economy" in a Critical Period of Widespread Digital Transformation and Massive Scale Up of 3rd Platform Technologies in Every Industry,” IDC, November 4, 20152 “Industry Cloud: The Largest Vertical Growth Opportunity for Technology Vendors and Services Firms Through 2025,” IDC, November 19, 2015

Schneider

GE

Bosch

ABB

Disney

SONY

Ford

GM

TomTom

Pfizer

Novartis

Merck

Carepass

Cigna

edX

Walmart

American Express

Nasdaq OMX


Industry Platforms:

17

18

Key challenges manufacturing companies are facing towards a platform enabled and connected ecosystem


Legacy Equipment

Low Operations Visibility

Changing Market Demands

Skilled Labor Gap

75%Of manufacturers report moderate to severe shortage of skilled resources 11%

Of revenue lost can be contributed to 8-10% skilled labor gap in a company80% Of US manufacturing labor

falls into the skilled labor category

50% Of manufacturers started new operations in 2013 29%

Of manufacturers believe that they have full visibility to their operations40% Of surveyed manufacturers

have relocated operations in 2013

76%Of manufacturers respond that they are not highly adept at sensing market demand 82%

Of manufacturers agree that the ability to shift resources and product mix between locations is critical to growthEntering a new market was the top reason for choosing manufacturing locations

3/4 Of companies have made manufacturing capital investments since 2011 60% Of these investments are put

towards equipment and existing infrastructure 66%Of manufacturers will focus on

extending life of existing assets rather than acquiring new ones

Connected Asset Management as the basis for platform enabled business

Remote Monitoring Predictive AnalyticsAnalytics Executive Dashboards

ERP Integration Industry Specific Apps

Remote Operations

IoT Platform IoT Gateway Control & CommunicationsNetwork

Things + Intelligent Sensors

CISCO

Apple

Android

Microsoft

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Building a Smart Products RoadmapIN

TERC

ONN

ECTE

D SY

STEM

OF

SYST

EMS

SMAR

T &

CONN

ECTE

D PR

ODU

CTS

SMAR

T BU

T ST

ANDA

LONE

Ecosystem enabled

Customizable/ConfigurableProducts

Prioritized Use cases

IoTVision

Ecosystem analysis & formation

Outcome-based business model analysis

Platform Roadmap

Product as a platform (App Store )

Mobile-accessible

Predictive maintenance & support

Pay-per-use Model

Self-optimize/Self-diagnose

Customer experience support across ecosystemData/Information Services

Remote tracking, diagnostic, & optimization

Ecosystem Development &Evangelization

Service-based Models

Product-basedServices

Data Monetization

Customized outcome-based business models

Support for dynamic and large scale ecosystem

Shared Revenue Model

Outcome-based business model launch

Auto Tuning/Configuration

API-enabled product & services

Platform to support Outcome-based ecosystem

Platform to support Ecosystem

Real-time Product Support (& training)

Standard Customer Support and Feedback

Product Usage &Customer Profiling

Hardware Exp. Software & Cloud Dedicated Security org

Anticipatecustomer needs

Data Science

Edge Intelligence

API

Connected Enterprise Systems

PredictiveAnd holisticcustomer experience

Arch Blueprint

CommunityManagementCross-group

Governance

Customer insight-driven product development

Connectivity, Mgmt and Security

Automated Process Orchestration Across platforms

Continuous Worker Certification

Partners andEcosystem Support

New Risk Products

Data API

PartnerPlatformIntegration

Metering & Monetization

Blended Workforce

Customer Participation in Product Design

Connected Enterprise

Data Mgmtand Analytics

Platform of platforms

Support forApps StoreReal-time optimization

Advisory Services

Service AggregationInteroperable products

Vision & Strategy

Products & Services

CustomerExperience

Ecosystem & Platforms

Organizations & Workforce

Unconnected Physical Products

Outcomes-based,

Software-enabled Services

Platform Economy: 100-Day Plan


1. Appoint a C-level champion to lead a cross-functional team of technologists, business experts, and economists.

2. Identify and prioritize parts of the business that are prime for platform business models.

3. Identify the parts of the business that are most vulnerable to attack by disruption from new platform-based business models (from incumbents and startups inside & outside industry).

4. Align the platform opportunities alongside existing product and market strategies (platform business models live alongside traditional product strategies).

5. Present initial findings to the Board and establish a top-down C-level enterprise-wide commitment to pursuing platform business models as a strategic growth path.

6. Assess your knowledge gaps of the new rules of business: demand-side economies of scale, power law distribution, network effects, and asymmetric competition.

7. Launch a company-wide campaign on the new rules of business and platform business models. Create a network of internal platform champions to evangelize the message.

8. Assess your digital technology capabilities and gaps in building platform ecosystems.

9. Prioritize the overall opportunities and threats, and then start with a small initiative to pilot, including internal initiatives to start the journey into platform business models.

Platform Economy: 365-Day Plan


1. Finalize plans to launch the initial pilot to work with a cloud partner to build a platform around one of the most information-intensive parts of the business.

2. Formalize agreements with the cloud partner that will be building the foundation of the platform.

3. Develop a multi-phase plan to transform parts of the business to platform business models.

4. Identify platform opportunities inside and outside your industry based on your executive training programs and platform knowledge base.

5. Establish a formal governance plan and organization to manage digital partnerships and developer communities in order to optimize the value of the platform ecosystem.

6. Formalize an approach to track and report on platform growth opportunities, relevant ecosystems, and competitive threats from both inside and outside the industry.

7. Communicate the vision of where your company fits in an economy without industry sector segmentation and with boundary-less competition.

Key Takeaways


The strategic use of technologies to create platform business models is driving

unprecedented growth opportunities in the rapidly expanding digital economy.

Driven by the new rules of business, platform business models represent the most profound disruptive change in the

global macroeconomic environment since the Industrial Revolution.

While tech and digital born organizations have been dominating the digital economy

with record-high market caps, non-tech digital leaders across all industries are

developing platform strategies now (the new tech leaders).

What’s Next

Non-techs become next innovation giants. Within 3 to 5 Years, non-tech companies will emerge as leaders of technology and business model innovation, shifting power away from the traditional tech and digital born organizations

New geographic innovation hubs emerge. This shift will inherently drive a geographic dispersion of innovation hubs away from tech centers like Silicon Valley to a variety of global hubs with industry concentrations

Ecosystems drive market caps. Within 3 to 5 five years, market cap valuations will be largely based the power of ecosystems and digital assets, including the network effect of platform interactions and control of key digital technologies such as algorithms and APIs.


Accenture & Cisco partnership: global capabilities to help transform and run your business

25Copyright © 2016 Accenture and Cisco. All rights reserved.

Accenture• Industry expertise • Business process, systems integration and

change management skills • Industrialized delivery• Strategic acumen• Proprietary methodologies

Cisco• Intelligent networks and technology

architectures, built on integrated products, services, and software platforms

• Proven roadmaps: Borderless Networking, Collaboration Data Center & Virtualization

One Team: Accenture & Cisco Business Group (ACBG)

Private & Hybrid Cloud

WifiData Centre

IoTResell

Network

Collaboration

Cisco Awards and Recognition• Cisco Gold Partner Status – India, Japan , Australia, Italy, UK & USA• Cisco Silver Partner Status - Canada• Cisco Premier Partner Status – Singapore, Philippines, Thailand, Spain,

Germany, France, South Africa & Brazil• Multinational Partner Status – APJ, EMEAR & AMERICAS• Cisco Solution Innovation Partner of the year in APJ (2015)• Cisco Channel Customer Satisfaction Excellence in 4 countries: US, France,

India, and Japan (2015) • US Nationals Partner of the Year (2014)• Cisco Channel Customer Satisfaction Excellence in 8 countries: US, France,

India, Canada, Australia, Spain, Japan, Italy and awarded 6 consecutive years (2009-2014) in US

• Solution Innovation Partner of the Year US, Cisco Partner Summit, 2013

The Numbers3,000+number of Cisco Certified professionals globally, with 73 CCIES1600+number of Cisco Certified professionals in Accenture Delivery Centers

13number of Authorized Technology Providers (ATPs)

15Cisco Channel Tech LAB around the globe

Cisco-certifiedand operating globally, with Gold, Silver, Premier and Multinational certifications

56Architecture & Technology Specializations


Thank you#techvision2016www.accenture.com/technologyvision

Every year, the Technology Vision team partners with Accenture Research to pinpoint the emerging IT developments that will have the greatest impact on companies, government agencies, and other organizations in the next three to five years.

As technology advancements continue to accelerate at an unprecedented rate - dramatically disrupting the workforce -companies that equip employees, partners and consumers with new skills can fully capitalize on these innovations.

Those that do will have unmatched capabilities to continuously create fresh ideas, develop cutting-edge products and services, and disrupt the status quo.

Winners in the Digital Economy Will Put People First


Change is the new normal. According to our global technology survey of more than 3,100 IT and business executives, 86 percent of the executives anticipate that the pace of technology change will increase rapidly or at an unprecedented rate in their industry over the next three years.

Many companies, already reeling from the impacts of technology and the changes they need to make in response, find themselves temporarily overwhelmed—some even paralyzed as they absorb the magnitude of the tasks ahead.

Getting past the digital culture shock that so many businesses find themselves in today sounds daunting. But fortunately there are models already available for inspiration. Not only have many large tech companies established thriving digital cultures, but there are also early adopters in other industries showing the way ahead.

Digital Culture ShockWe are in the midst of a major technology revolution, specifically a digital revolution. Our research model and analysis shows that digital is now dominating every sector of the economy.


The research process began during 2015 with gathering inputs from the Technology Vision External Advisory Board, a group comprising more than two dozen experienced individuals from the public and private sectors, academia, venture capital, and entrepreneurial companies. The Technology Vision team conducted interviews with technology luminaries and industry experts, as well as with nearly 100 Accenture business leaders.

The team also tapped into the vast pool of knowledge and innovative ideas from professionals across Accenture, using Accenture’s collaboration technologies and a crowdsourcing approach to run an online contest to uncover the most interesting emerging technology themes. More than 3,200 participants actively engaged in the contest, contributing valuable ideas and voting on others’ inputs.

Technology Vision Research Methodology

As a shortlist of themes emerged from the research process, the Technology Vision team reconvened its advisory board. The board’s workshop, involving a series of ‘deep-dive’ sessions with Accenture leadership and external subject-matter experts, validated and further refined the themes.

The screens used during these processes weighed the themes for their relevance to real-world business challenges.



Technology Vision 2016 Survey DemographicsFor the second year, we conducted a global survey of more than 3,100 business and IT executives across 11 countries to understand their perspectives on the impact of technology on their organizations, and to identity their priority technology investments over the next few years. The survey was fielded from October through December 2015.

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Technology Vision 2016 Survey Demographics



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EMEAR IoT RF Accenture Keynote session