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Cisco Public 1© 2013 Cisco and/or its affiliates. All rights reserved.The Internet of Everything(IoE) Value Index

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 2Delivering the rightinformation to theright person (ormachine) at theright timeProcessLeveraging datainto more usefulinformation fordecision makingDataPhysical devicesand objectsconnected to theInternet and eachother for intelligentdecision makingThingsConnecting peoplein more relevant,valuable waysPeople

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 3• SG&A and CoGS reduction from improvedbusiness process execution• Improved capital efficiency• Improved labor efficiency• Fewer or more productive man-hours• Improved customer lifetime value• Additional market share (more customers)• Improved RD&E speed, reduced TTM• New business models and new sources ofrevenue• Improved process efficiency• Reduced waste in supply chainIoE Valueat Stake:$14.4T(2013-202210-yearNPV)** Net present valueAsset utilization:$2.5TImproved customerexperience: $3.7TSupply-chain / logisticsefficiency: $2.7TInnovation: $3.0TEmployee productivity:$2.5T21usecases

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 4• Conducted ground-breaking online survey of 7,501 business and ITdecision-makers, split between enterprises and mid-sizedcompanies• Study executed by the Cisco Consulting Services Research &Economics Practice• MIT Center for Digital Business provided advice on questionnairedevelopment, but not on the IoE Value Index design or Value atStake / value-realized estimates• Fielded in 12 of the largest global economies (70% of worldwideGDP): Australia, Brazil, Canada, China, France, Germany, India,Japan, Mexico, Russia, U.K., and U.S.• Estimates actual value realized by firms in 2013 as a share ofpotential Value at Stake; explores key IoE enablers (people, process,data, things) that drive value

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 5Global Value at Stake2013-2022(10-year total)$14.4T*2013$1.2TValue at Stake 2013(Jan. – Dec.)$1.2TValuerealizedin 2013IoE Value Index$613B(53%)$544B(47%)Value“left on table”in 2013Note: chart is not to scale* $14.4T is conservative because it is based on a set number (21) of private-sector use cases and discounts future cashflows due to uncertainty around privacy and regulatory issues.

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 64%5%4%19%6%28%26%42%36%50%47%33%Information SecurityWagesJobsDo Not Know Lower / Worse No Change Higher / Better3-Year Outlook as Result of IncreasingIoE PervasivenessN=7,501 respondentsKey Trends

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 7N=7,501 respondents#1 Accelerating pace of innovation#2Satisfying customer demand fornew ways of interacting#3Need to automate businessprocessesKey DriversTop 3 Business Drivers of IoE

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 8#1 New types of devices#2 Volume of data generated#3 Cloud-based technologyN=7,501 respondentsKey DriversTop 3 Technology Drivers of IoE

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 9N=7,50147.1%47.7%47.9%48.8%51.0%52.5%53.1%53.4%53.5%54.2%57.7%62.2%52.9%52.3%52.1%51.2%49.0%47.5%46.9%46.6%46.5%45.8%42.3%37.8%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%MexicoRussiaAustraliaChinaBrazilIndiaCanadaU.K.U.S.FranceJapanGermanyIoE value realized IoE opportunityFirms in:Value at Stake2013 ($B)$87.5$71.2$59.4$472.9$53.3$56.8$34.8$34.0$157.7$74.4$35.6$19.6

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 1044.9%45.8%46.0%50.7%50.8%54.2%57.4%60.5%65.4%55.1%54.2%54.0%49.3%49.2%45.8%42.6%39.5%34.6%0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Retail /Wholesale /…EnergyManufacturingTransportationOtherHealthcare / LifesciencesServicesFinancialservicesHigh tech /TelecomsIoE value realized IoE opportunity N=7,501Value at Stake2013 ($B)$118.3$115.2$276.9$98.7$65.4$23.6$224.4$55.0$179.6

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 115.1%8.2%9.7%13.1%13.3%14.3%16.1%20.1%0% 5% 10% 15% 20% 25%Information accuracyInformation accessibilityInformation ease of useMeasurement practicesHuman capital practicesInformation management practicesInclusiveness practicesQuality of technology infrastructure and toolsThingsPeople Process DataTogether, thesefactors explain66.2% of changesin value realized(R2 = .662). Thisis a robust modelof what predictsvalue realized.Relative Importance of IoE Enablers inPredicting Value Realized

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 12• Firms will capture just 53% of IoE’s Value at Stake for 2013, leaving $544B ofunrealized value• IoE is driving competitive parity, raising the stakes for differentiationamong companies and countries:Emerging-market countries and midsized companies are poised to realize significantvalue from IoE, enabling them to quickly achieve parity with — or even outpace —developed countries and larger firmsSmaller companies are already realizing as much IoE Value at Stake as someenterprises• To capture maximum value from IoE, firms should focus on the IoE-drivencapabilities that will benefit their industries most:Manufacturing firms: real-time, multidimensional data analysis; integrated videocollaboration; remote tracking of physical assets; intelligent robotsEnergy firms: integration of sensor data; ability to locate experts; predictive analyticsRetailers: predictive analytics and data visualization; BYOD and interacting withcustomers using rich media; mobile payments and remote customer monitoring

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© 2013 Cisco and/or its affiliates. All rights reserved. Cisco Public 13• To capture more value in the IoE Economy, companies must:Invest in high-quality technology infrastructure and toolsAdopt and follow inclusive practicesDevelop effective information-management practicesMove from…Better is betterBigger is betterTo …CloutAccess to informationBig dataBusiness intelligenceConnectivityCloudBig judgmentIntelligence at the point of decisionConnectednessExpertise everywhere

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Thank you.Value Index Tool:http://internetofeverything.cisco.com/explore/full#/country/usaInternet of Everything (IoE) Follow Up:http://cs.co/IoE-contactme