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Digital Transformation

Digital Transformation

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  • 1. 1igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationRedefining IndustriesPrepared and Published By : Vishal
  • 2. 2igitalTransformation,WorkinProgress,©AllRightsReservedAgenda Drivers Digital Transformation Impact on Industries, IT and Stakeholders Digital Transformation – Model Digital Transformation – UX, SO, LO, MO, Gamification, Cloud Benefits, Adoption, Challenges Readiness, Operating Model Design Governance and Maturity SummaryDisclaimer: This presentation acknowledges and gives credit to the work of others. Necessary validation have been taken to avoid copyrightinfringement. Any instances that violate terms can be removed when notified. All discussed thoughts & opinions are my own & not that of myemployer or others parties.
  • 3. 3igitalTransformation,WorkinProgress,©AllRightsReservedProfileSummaryVishal has more than 14 years of experience in Business and IT Advisory with a focus on providing advisoryservices to clients, securing lucrative client engagements and ensuring successful business transition. An able strategicadvisor & business evangelist enthused by the potential of new emerging business trends and technologies to deliverexpandable and streamlined business solutions with greater return on assets and investments.Vishal provides thought leadership with a focus to create new growth areas and untapped market segments.For further information or feedback, please contact:Name: VishalEmail: mail@sharmavishal.comTwitter Handle: sharmavishalLinkedin: This presentation acknowledges and gives credit to the work of others. Necessary validation have been taken to avoidcopyright infringement. Any instances that violate terms can be removed when notified. All discussed thoughts & opinions are myown & not that of my employer or others parties.
  • 4. 4igitalTransformation,WorkinProgress,©AllRightsReservedDigitalEvolution (Physical to Bits)70 – Mid 80’sFinance(Transactions)Customer(Engagement)Internal (Ops.)Learning,Collaboration&InfrastructureMid 80’s - 00 00 - TodayTV, TelephoneATM, EFT DrivenCollaboration. Driven byVoicemail, and PagersInfra as PC and MagneticTapesOnline (web), Telephone, TVWeb Driven(e-commerce)Collaboration. Driven byemail, IM, CellphoneInfra as Latptop, CD/DVDWeb, Social Media Channels,Smart DevicesMobile and Smart DevicesDriven(from m-commerceto cashless commerce)Collaboration. Driven byVOIP, Live Meeting, SocialNetworksInfra as Tablets, USB, Cloud• Digital world has evolved enormously from early 70’s to this date.• Today it has led to transformation of physical entities to bits (digitised).
  • 5. 5igitalTransformation,WorkinProgress,©AllRightsReservedBandwidthEvolution (Internet)Only FTTH(250 MBPS)Late Cable,FTTH(100-200 MBPs)VDSL, Cable(25-50 MBPS)BandwidthISDN(128 KBPS)Basic WebBrowsingYearsADSL(6-16 MBPS)DSL(1-2 MBPS)AdvancedBasic WebBrowsingP2P MusicSharingBasic 3DVideo onDemandVideoStreaming3D Worlds& P2PIPTV3DEmulation&Entert.Advancedto BasicAppHosting3D VirtualCollab.End to endRemoteComputingSource: NBN CO• Evolution of Internet is merging the gap between Physical and Digital world.• Internet led Digital disruption is resulting in new generation of digital services.• Internet has initiated a path of redefining industries and livelihood of human beings.
  • 6. 6igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationDisruption LedDisruption across industries by digital evolution is swift and deadly• It is operating at the speed of thought• It turns assets into liabilities• It comes from any firm of any size and from anywhereDigital Disruption is driving fundamental shift in Business Model. This shift has led to deep impact on organisations operation,structure and, their culture. Its low barrier to entry is driving constant innovation and opening doors for non digital business.Source: Disruptors Handbook, 2012
  • 7. 7igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCustomer Behaviour LedStage 1Internet&Dot Come-CommercewithControl &ChoiceDriversOutcomeStage 2MobileDevicem-CommerceAnywhere,AnytimeStage 3(Today)Smart Devicewith AppStoresCashlessCommerce,User Exp.&Ubiquitous• Consumers driven by customer experience areadopting new platforms and technology.• Ubiquity of internet has led to DigitalTransformation across vertical industries andmerging the gap between physical and digital world.• Owning the digital ecosystem (like app stores) hasbecome a vital channel for customer engagement,retention and revenue generation.Credit: Banking 2.0
  • 8. 8igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationConvergence Led• Emergence of Social Platforms like Facebook,Twitter and Linkedin has redefined howcustomers are engaged in a digital world.Customers used these as a learning, sharingand collaborating platform.• Emergence of Smart Mobile Device(incl.Tablets) with superior and engaging UX hasled customers to use this as a preferredplatform for commerce and serviceconsumption.• App Store led Commerce and Services indigital world is increasing in double digits(yoy).• Owning the digital ecosystem (like app stores)has become a vital channel for customerengagement, retention and revenue generation.• Emergence of GPS enabled devices haveallowed localised targeting of services.• Convergence of SO, LO, MO is driving digitaldisruption across every industry.Source: TOP MOBILE INTERNET TRENDS , KPCB, 2011SocialLocal MobileLO MOSOTransformedSuperior andEngaging CustomerExperienceAnywhere,Any device,Anytime
  • 9. 9igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationValue PropositionDifferent organisation require different approach for leveraging benefitsfrom digital transformation in their evolution.• Pure Digitisation leads to expansion of core business to digitalplatforms.• Pure Transformation leads to change in traditional business modelto a new type of business model.• Combination of executing Digitisation (services and platforms) andBusiness Transformation (culture and business model) in parallel isless agile and difficult task to achieve. However this is the bestoption, executing either option individually or sequentially will notgive the desired outcome.Core Business DiversificationOrganicGrowthInorganicDigitisationTransformationSweet Spot
  • 10. 10igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationAttributes• Simple• Ubiquity – universal access to apps and services by consumers and enterprises• Personal• Affordabiltiy – pricing to make them affordable• Speed – extent to which digital services can be accessed in real time• Usabiltiy – ease of use• Empowering• Skill• Reliability – Quality of available digital services
  • 11. 11igitalTransformation,WorkinProgress,©AllRightsReservedIndustriesCost StructureProfitRentMedia& Entertmt.TelecomFinancialServicesEducationHealthcare &PharmaRetail &DistributionEnergy &UtilitiesUtilitiesDep.OtherWagesPurchasesAverageCost(%ofRevenue)11.70% 9.60% 12.20% 12.40% 20.00% 8.60% 4.80%3.70% 1.20% 0.70% 1.00% 3.00% 10.60%2.20% 0.10% 0.50% 1.80% 0.90% 71.00%4.30% 0.80% 14.40% 2.70% 9.70% 3.40% 1.20%56.50% 82.50% 47.30% 10.40% 44.70% 13.50% 0.90%13.50% 6.10% 15.00% 17.40% 6.20% 52.50% 3.60%8.50% 0.10% 9.20% 54.30% 19.40% 18.10% 7.90%Its vital to understand cost structure across the industries. Digital Transformation is driving afundamental shift in Business Model and how services are offered and consumed.Example: Banks are prime place for this transformation before telco’s. As “money ” (physical form) isbecoming more digital (non-physical) before voice (analogue to digital). Across the whole value chain of abank, transactions will be digitised from end to end. This has led Banks to focus on digitisation of assets andservices with customer centricity and customer experience as a prime driver and differentiator.Source: IBIS World
  • 12. 12igitalTransformation,WorkinProgress,©AllRightsReservedIndustriesOperating ConditionToady various industries are going through different operatingconditions impacted by various market forces. This matrix providesindicative view of current operating condition of followingindustries:• Media & Entertainment is Hazardous as content has becometotally digital and media houses are still applying Old MediaModel (explained later).• Telecom have become Stagnant as vertically integratedmonopolies have gone or are going though structural separation(AT&T, BT, Telstra), impacting their top and bottom line.• Financial Services are Stagnant (Post GFC) as their Balance Sheetis heavily leveraged and their traditional market has matured.• Education -• Healthcare & Pharma -• Retail & Distribution -• Energy & Utilities are going through a Rollercoaster journey.HighLowRevenueVolatilityHighHazardous RollercoasterBlue ChipStagnantLow 5 Year Annualised GrowthFinancial Services(Post GFC)Financial Services(Pre GFC)Media &EntertainmentTelecomEnergy &Utilities
  • 13. 13igitalTransformation,WorkinProgress,©AllRightsReservedImpact on Industry StructureCharacteristics:• Integrated Components• Proprietary Interfaces• High Barriers to entry• All or NothingEmerging Product Mkt.Emphasis:• Performance• FunctionalityHorizontal Industry Structure Vertical Industry Structure• Double Helix: All industries move between Horizontal toVertical Structures. This shift from one structural side toanother is w.r.t time is defined as clock speed.• Digital Transformation has distrupted clock speeds acrossall the industries fueled by evolution and penetration ofinternet. Clock speed has become faster for every verticalindustry.Source: Clock Speed – Charles FineDouble Helix: Industries Move between Horizontal to Vertical StructuresCharacteristics:• Modular Components• Standardised Interfaces• Low Barriers to entry• Mix and MatchMaturing Product Mkt.Emphasis:• Price• Flexibility• Customisation• ConvenienceDigital Transformation
  • 14. 14igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationHeat Map - Impact on IndustriesFinance(BusinessModel)Customer(UserExperience)TelecomMedia &Entertmt.FinancialServicesEducationHealthcare& Pharma.Retail &DistributionEnergy &UtilitiesInternal(Ops.)Learning&Growth(Culture)ExtremeRatingLowModerateHighConsiderable
  • 15. 15igitalTransformation,WorkinProgress,©AllRightsReservedImpact on Industries Cost StructureProfitRentMedia& Entertmt.TelecomFinancialServicesEducationHealthcare &PharmaRetail &DistributionEnergy &UtilitiesUtilitiesDep.OtherWagesPurchasesExtremeRatingLowModerateHighConsiderableDigital Transformation
  • 16. 16igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on TelecomDevelop Build SellOperate Integrate ServeContent &CommunitiesDevices &Local NtwksEnd User SvcApplicationsPlatformNetworkData Centers• There is a fundamental shift in Telco’s traditional model which was about generating revenue fromanalogue based voice and services.• Emergence of IP based networks has led to digitistiaon of voice. This has led to emergence of newplayers like Skype, Facebook and Google which is impacting their bottom and top line.• Infrastructure stack for services as highlighted on right hand side is now on the verge of becomingdigital end to end. This is driving digitisation of services and business processes across the whole valuechain.• End to end digitisation will allow telco’s to set up end to end service offerings in a virtual box.• Data growth will require massive investment in cloud computing and Network Infrastructure upgrade
  • 17. 17igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationThreat to Telco’sFacebook• Social Networking (communication) as acore business service, largely asynchronousgroup comm.• Subsidised (free) to the end user andfunded by advertisers• 600 M users on MobileSource: Google,,,, STL PartnersTelco• Communications as core business service,largely synchronous Peer-to-Peer (P2P)communication• Paid for by the end userCallsConversationsRelationshipsCommunitiesTelephonySocialNetworksRendezvousVolume• Telco’s conventional business model (PSTN based) is ondecline because new digital players like Google, Skype andFacebook have innovated. Conversation and Engagementis driven by these digital platforms.• On Mobile front they are facing serious threat because ofdata growth driven by services launched in Mobile andSocial domain. ROI to meet data growth is dinsiminishing
  • 18. 18igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationOpportunity for Telco’sVertical Industry Solutions• Energy• Healthcare• Education• Transport• Government• EntertainmentOwn BrandOver The Top• Social Networking Apps• Access independentcommunications services• Other app and appstores• M2M Service EnablementCore Services• Improvement of CoreProduct Portfolio• Redefine CustomerExperience• Leverage online• Engaging MarketingInfrastructure Services• Data Centre Capabilities• Mobile OffloadB2B Enabling Services(3rd Party)• Identity & Authentication• Marketing & Advertising• Payments• Customer CareEmbeddedCommunications• Communications enabledbusiness processes• Voice and messagingwith games• M2M and Embeddedmobility connectivitySource:Stlpartners,RoadmaptoTelco2.0
  • 19. 19igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCreate andDevelopProduction PackagingPublishingStudios &NetworksEntertainmentImpact on MediaDistributionand SellDisplay
  • 20. 20igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMedia Failure - MyspaceReason• Applied Old Media Business Model (advertising and Fees only) as Rupert grew his newspaper empire leveraging that lockedin Advertisers (via Google Search) on Upstream Side, and let the Customers create content (primarily blogs). Didn’t let oropened Upstream Side to other Customers. No fees from Downstream Side consumer as they were subsidised.• Network effects on Downstream side are not leveraged on Upstream side – leading deterioration in asset and momentumshifting towards other platform like Facebook and TwitterOnly 1Customer(Advertisers)Content DistributionCustomers(Subsidised)RevenueMYSPACEPlatformUpstream DownstreamCostSource: Google, Strategies for 2 Sided Markets, Thomas Eisenmann, HBR• Rupert Murdoch identified an opportunity with Myspace(Social Media), but couldn’t leverage it.• Turned out to be a losing bet.
  • 21. 21igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMedia Success - FacebookSource: Google, Strategies for 2 Sided Markets, Thomas Eisenmann, HBR• Mark Zuckerberg and his understood the potential ofmulti sided model opened Facebooks platform via APIs• Until now its paying him well.• Next challenge is leveraging Mobility and increasingrevenue share from that.Reason• Applied New Media Model in a 2 sided market• Opened Platform for various Upstream Customers – Hosted Content from various players, Ads, 3rd party app Developers• Opened Platform for various Downstream Customers – Market Research Companies• Networks effects on Downstream side are leveraged on Upstream side – built mass and momentumVariousCustomersContent DistributionCustomersPaid DataResearchRevenueFACEBOOKPlatformUpstream DownstreamCostRevenueRevenueCost
  • 22. 22igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationOpportunity for Media
  • 23. 23igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Financial Services
  • 24. 24igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Financial Services
  • 25. 25igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Banks end to end OperationsChannelsMgmt. Info.SystemsSecurityInfra.Fin Mgmt.(ERP)HR Info.SystemsBusinessRules EngineRisk &ComplMgmtFraudMgmt.Tele. Internet Mobile ATM POSAgentsExternalSalesCustomer ManagementBranch Govt .&UtilitiesSWIFTNetworkCollectionAgentsVisa/MCNetworkClearingHouseCentralBankMarketFeedsForeignBanks &BranchesOtherCustomer Sales/Service CollectionsOriginating &DecisioningDisputeResolutionSystems & Asset Mgmt. and MonitoringDataDirectoryServicesCustomerInformationOperationalSvcs Data StoreHRManagementEnterprise DataWarehouse………………Integration Layer (Batch & Real Time)Enterprise Content Management BPM WorkflowCore BankingDemandDepositsTimeDepositsRetail Lend& LeasingTimeDepositsOtherDepositsOtherServicesPayments & TransfersCustomer Info File (CIF)General Ledgers (GL)Comm.DemandDepositsCommercialLendingComm.Time DepositsCorporateLendingRetail Commercial Front Office AppsCards, Cash Mgmt,Wealth Mgmt., ProductSpecific (Insurance)Back Office AppsStmts, Card Processing,Underwriting, Chq.Clrng & IssuanceExternalInterfaces
  • 26. 26igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Education
  • 27. 27igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationEvolution of RetailMatch MismatchMismatch MatchFunctionalProductsInnovativeProductsResponsiveSupplyChainEfficientSupplyChain• Products - From Functional to Innovative Products• Services are becoming PersonalisedSource: HBR - What is the Right Supply Chain For Your Product
  • 28. 28igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Retail
  • 29. 29igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationImpact on Utilities
  • 30. 30igitalTransformation,WorkinProgress,©AllRightsReservedSource: BCGDigital TransformationImpact on IT, Relationships and StakeholdersApplicationsSpeed&Cycle TimeMethodologyand ToolsSkillsCustomer toBusinessBusiness toITIT to ITIT to3rd PartiesIndustrial (non Digital) Speed Digital Speed• Mature technologies with long life cycles • Emerging, short life time, built on fast changingtechnology with legacy technologies• Release cycle of 6 to 12 months driven byplanned business needs• Quick cycles (<1 mth) from idea to deployment,driven by rapidly changing users needs and comp.• A hierarchical organisation using establishedframeworks and standardised approaches to design• Self organising teams using agile tools, fastevolving SDK and automated• Individuals with specialised skills• Jack of all trades who combines upto dateknowledge of technologies and business• Predictable demand via established channels,products and processes• Unpredictable demands due to evolving trends,technologies and channels• Siloed and Fenced driven by mid and long termstrategies• Highly collaborative and constantly changing• Siloed and Fenced, vertically integrated, tech stackis stable• Collaborative and horizontally integrated, techstack is constantly evolving• Buyer – vendor relationship, IT controls the pace ofinteraction• Participating in 3rd party ecosystem, the ecosystemsets the pace
  • 31. 31igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCustomer Engagement ViewMobileSocialWebUserExperienceLocalGamificationCustomer Engagement in Digital Transformation Era
  • 32. 32igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationFunctional ViewMobileSocialLocalCustomer ExperienceCloud as a PlatformServicesBigDataandAnalyticsBoundaryLess(Information)WebGamification
  • 33. 33igitalTransformation,WorkinProgress,©AllRightsReservedSource: Boersma’s T-Model of UX - 2004InformationVisualDesignIntroductionInformationArchitectureUsabilityDesignCopywritingMarketing&CommunicationMobile,PC,SmartDevicesUser Experience DesignDigital TransformationUser Experience - Design Model
  • 34. 34igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationWhy Social MediaSource: Capgemini - Social Business TransformationLow HighLowCompetitivenessSocialCustomersHighCustomerEngagementCorporateBrandingUrgentEnterprise WideCostReductionCustomer Engagement• Marketing• Sales• Production• ServiceEnterprise Wide• All ProcessCorporate Branding• HR• Corporate CommunicationCost Reduction• Product Develop.• Production• Procurement• LogisticsSocial Media is not a fad anymore, it is on the verge of becoming amainstream medium in a B2B and B2C environment. It is driving majorchanges in 4 main areas, Customer Engagement, Branding, Cost Reductionand Enter prise wide processes. Following areas under each heading isleveraging this medium for facilitating Digital TransformationSocial Media must be a part of Digital Transformation roadmap so that enterprisegoals are aligned across all the business units. Risk of running a silo based Socialinitiative within an organisation or by marketing team only will not give benefitsin terms of ROI.
  • 35. 35igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationSocial Media – More To ComeCaptures FutureCaptures PresentCaptures Past• There is more to come in Social Media. Digital platforms to this date have captured past andpresent of a customer quite well, courtesy of Facebook (Primarily Photos) and Twitter(Primarily Announcements).• For capturing future, like announcements, events, meetings, tasks, more work is required.Leveraging Data Analytics and Artificial Intelligence will drive emergence of a sustainableplatform.Facebook(Photos)Twitter(Announcement)?
  • 36. 36igitalTransformation,WorkinProgress,©AllRightsReservedSocial Networks(Facebook, Twitter, Foursquare, Linkedin)Monitoring & Analytics(Brand Monitoring, Insights)Aggregation(Identity Brokers,Aggregators)Publication(Apps, Management)Social Platforms(Community, Collaboration, Blogging, Innovation, SocialCommerce )ServicesInfrastructureSource: Altimeter Group, Business StackDigital TransformationSocial Media Business StackThis stack can be used to map current footprint of Social Media penetration within an organisation.
  • 37. 37igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationGamification• Gamification is composed of the incentives and rewards thatthe users are awarded for performing tasks or challenges,and achieving goals. It is critical to understand userobjectives and motivations to create a game economy thatimplements a user-centric design.• One of the key distinctions of a gamified transformation isthe calculated use of intrinsic rewards to create a meaningfulexperience for the users. Just like in real economies, in gameeconomies, these currencies can easily become inflated andlose their value if they are overused. Scarcity is a keymotivator to maintain the value of currencies in a gameeconomy.• Four basic currencies that users accumulate in gameeconomies — fun, things, social capital and self-esteem —that are implemented through game mechanics, such aspoints, badges and leaderboards.Source: Gartner 2012Self EsteemSocial CapitalFunThingsGame Economy
  • 38. 38igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationBig DataStructured UnstructuredBatchData Variety& VolumeVelocityRealTimeIn MemoryAnalytics(Payments, POS,Weather)HadoopMap Reduce(Video, Forums,SharePoint, Text Doc)DataWarehouseBig Data(Google+, Twitter,Facebook, TextMessage, Clicks)AnalyticalFactoryBig DataTop DownBusiness Issue• Big Data growth is predominantly driven newand emerging information goods likeFacebook, Twitter. Integration with existingdigital assets has become a business issue.• Big Data growth needs to be addressed withspeed, agility and regular iteration as part ofdigital transformation journey. This datarequires robust approach of design andanalytics to give insights to business (knownas BI).Bottom UpInternal & ExternalSource: Booz & Co 2012
  • 39. 39igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationBig Data - AnalyticsLow HighLowBusiness ValueComplexityHighReport(what happened)Monitoring(what’s happening now)Analytics(what didn’t happen)Forecastingand Prediction(what might happen)PrescriptiveWhat Actions(Should be Taken)
  • 40. 40igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMobileLow HighLowComputingPowerPortabilityHighMobile/SmartDevicePC/DesktopSource: Forrester 2011ContextualPull andPushRelevantEntertmnt.LocalPersonalMobilePrinterWearableDevices Tablets
  • 41. 41igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMobile - User ExperienceMotion(Gesture based)VoiceTouchSource: Forrester 2011 Future of Mobile is User ContextTo(iPhone)Vo(Siri)Mo(Samsung 4S)
  • 42. 42igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMobile – App Ecosystem• App store based ecosystem is driving the shift towardsmassive uptake of smart devices by Consumers andEnterprises.• App Stores are a control point foro Discovery of appso Distribution of appso Monetisation of appso Exit barrier for userso Consumer insights• In future, well see smarter, connected apps. There will bea shift from native to hybrid and web apps.Multiplatform apps will reign supreme.Low HighLowIntelligenceEngagementHighMobileEngagementTransformativeAppMobileIntelligenceSimpleAppTraditional/Legacy SystemsSource: Frog, Mobile Strategy - 2013, IBM
  • 43. 43igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMobile – App Type and DistributionSource: Frog, Mobile Strategy - 2013, IBMInteroperabilityFunctionalityApp Store Distribution Driven Web Distribution DrivenNative AppCrossCompiledAppHybridAppWebAppMobileSite
  • 44. 44igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationMobile - Cash and Card less CurrencyContactlessPaymentsSMSTransactionsDirect MobileBillingMobile WebPayments• Mobile device (especially a smart device with NFCcapability) has become a mode of paymenttransactions.• Users dont need to carry cash or a debit/credit cardCredit: Bank 3.0VirtualPaymentsP2PPaymentsIn AppPayments
  • 45. 45igitalTransformation,WorkinProgress,©AllRightsReservedSource: Mobile Strategy, Dion HinchcliffeDigital TransformationMobile Stack – Functional ViewSecurity OpsBusinessAppsMessagingCustomerAppsContentEnablementPlatformSupportLocationServicesAppStore
  • 46. 46igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationLocalisationPlaceVicinity ContextLocalisationThingsPositionProximity
  • 47. 47igitalTransformation,WorkinProgress,©AllRightsReservedSource: APIs and Open Platform –Federico Cargnelutti• Moving from licensing model to Utility and Brokerage(using API’s)• Commodity Software or Business Process will beenabled via CloudDigital TransformationCloud - Turning Products into Platforms
  • 48. 48igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCloud as a Platform – Types, BenefitsSource: Alan Quayle BlogPrivatePublicHybrid• Ease of Access,Anytime, Anywhere• Standard SLA• Cheap• Highly Secured• Customisable SLA• Expensive• Secured• Customisable SLA• ModeratelyExpensive• Shared Servicesand Expertise• CommoditySystems• Full Control• Sensitive andMission CriticalSystems• Moderately inControl• ScalabilityMeans to Business BenefitsCloud TypeDecentralised CentralisedSlowITTimetoMarket&InnovationRapidTraditional/Legacy SystemsCloudHosted Systems2nd EraRevenueGeneration SideBusinessTransformativeSystems/Apps1st EraCost SideOpex ControlDriven Apps
  • 49. 49igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCloud as a Platform – Services ModelCharacteristicsExampleStrategy• Procurement• E-mail• HR• Billing• Low Level of Change• Non Differentiating• Available in Cloud• SAAS, PASS, IAAS• (drivesstandardisation)• e-Channels• BPM• B2B services• High level of change• Differentiating• Need for speed• Build agile ITPlatform with IAASand PAAS• Large core bankingplatforms• Analytics andmodeling• High stable volumes• Differentiating• High Performance• Build internal cloudCommodity Agile Scale• R&D• New markets andpropositions• Uncertain demand• Uncertainrequirements• Scalability• Maximise cloudsourcing for variablecostsGrowthSource: BCGIT Services Model
  • 50. 50igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationChallengesFinance(Transactions)Customer(Engagement)Internal (Ops.)Learning,Culture&InfrastructureRapidly Changing CustomerDesire and Needs. Digitalgeneration is always on themove.Business process arefragmented, need to digitiseall, leveraging new digitalplatformsResistance to Cultural ChangeFail Fast is MissingLack of unified Marketing, andfragmented ChannelsOld operating Model.Lack of Analytics andIntelligence on DigitalOperationsAgeing infrastructureand Information Overload.Ad hoc strategy to leverageand integrate social andmobile ecosystems. No welldefined KPIsLack of Customer CentricServices. Most services arefunctionality driven and aren’tintuitiveLack of collaboration and Silobased Approach hinderingBoundary less informationflow
  • 51. 51igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationWhy It’s DifficultSource: Creating Corporate Advantage , David J. Collis & Cynthia A. MontgomeryStructure,System&ProcedureLinkages&AlignmentIntro Growth Maturity DeclineCCDrivesBehaviourPeople ShapesCultureTimeCulture Shapes PeopleCulture is the biggestchallenge for anytransformation to besuccessful.For matured organisation cultural challengeis magnified enormously as it drives thebehavior of people. Any change to that isresisted vigorously.Cultural
  • 52. 52igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationBenefits
  • 53. 53igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationAdoption and Management
  • 54. 54igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationReadiness
  • 55. 55igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationOrganisation MaturityLow HighLowTransformationIntensityDigitalIntensityHighBeginners ConservativesAdvanced(Desired State)FashionistsSource: Capgeminu Digital Transformation 2013
  • 56. 56igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationCapability MaturitySource: UQ and EY, Digital Capability Maturity Framework. 2013StrategyDigitalUserExperienceLow Moderate Considerable High ExtremeDesignMeaningfulContentChannelIntegrationOperationsGovernanceDigitalInfrastruc.
  • 57. 57igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationIT MaturityBusinessSilosStandardisedTechnologyOptimisedCoreIT MaturityBusinessModularity
  • 58. 58igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationOperating Model Design
  • 59. 59igitalTransformation,WorkinProgress,©AllRightsReservedFinancialLearning & DevelopmentCustomerInternalValueOptimisationGovernance - Bus. & IT GoalsEnterprise Goals Governance ObjectiveRiskOptimisationResourceOptimisationCorporateLearning & DevelopmentCustomerInternalFinancialIT Goals Enterprise GoalsCustomerInternalLearning&Develop.Evaluate, Direct & MonitorDeliver, Service & SupportAlign, Plan & OrganiseBuild Acquire & ImplementCOBIT (IT) Process IT GoalsCorporateCustomerInternalLearning&Develop.123StakeholderGoals MappingCascade toProcess LevelVia Business &ITTransformationSource: COBIT
  • 60. 60igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationSummary
  • 61. 61igitalTransformation,WorkinProgress,©AllRightsReservedDigital TransformationAppendix
  • 62. 62igitalTransformation,WorkinProgress,©AllRightsReservedServicesProductDesignService StrategyServicePortfolioCustomerSegments &InsightsGTMApproachPricingDeliveryProcess &ToolsOp.Excellence& MetricsService OrganisationService CultureOffering Sales DeliveryServiceExcellenceDigital TransformationImpact on Service Industry