Re imagining the future

2. THROUGH THE LOOKING GLASS

3. I N D U S T R I A LA G R I C U LT U R EH U N T E R - G AT H E R E R 1 2

4. AUGMENT ED INDUSTRIAL A G R I C U L T U R EH U N T E R - G A T H E R E R 1 2 AUTOMATED REVOLUTIONS 3

5. FIRST INDUSTRIAL REVOLUTION Steam Engine 1 7 0 0 1 9 0 01 8 0 0

6. THE FORCE BEHIND REVOLUTIONS 1st INDUSTRIAL REVOLUTION E N E R G Y Coal, Steam C O M M U N I C AT I O N S Printing, Telegraph T R A N S P O R T Locomotives, Steamships

7. SECOND INDUSTRIAL REVOLUTION SPECIAL CENTURY 1 9 7 01 8 7 0 1 7 0 0 1 9 0 01 8 0 0

8. SPECIAL CENTURY

9. THE FORCE BEHIND THE SECOND REVOLUTION 1st INDUSTRIAL REVOLUTION E N E R G Y Coal, Steam C O M M U N I C AT I O N S Printing, Telegraph T R A N S P O R T Locomotives, Steamships T R A N S P O R T Internal Combustion Vehicles on National Roads C O M M U N I C AT I O N S Telephone, Radio, Television 2nd INDUSTRIAL REVOLUTION E N E R G Y Electricity, Oil

10. 1 9 7 0 2 0 0 71 7 0 0 1 9 0 01 8 0 0 ECONOMIC SYSTEM SHIFT Inflation: 1970s Public debt: 1980s Private debt: 1990s THE FORCE BEHIND THE THIRD REVOLUTION

11. We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before Klaus Schwab Founder and Executive Chairman 2 0 0 71 7 0 0 1 9 0 01 8 0 0 FOURTH INDUSTRIAL REVOLUTION

12. THE 4th INDUSTRIAL REVOLUTION T R A N S P O R T Electric Autonomous Vehicles, Space, Drones, 3D Printing, High Speed E N E R G Y Renewable, Distributed, Stored, Abundant, Wireless C O M M U N I C AT I O N S Digital, Agents, Gesturing, Looking, Conversational, Mixed Reality, Brain

13. Yes Undecided 87% 8% TOTAL RESPONSES: 747 Do you believe we are on the verge of the next revolution? No3% Other1%

14. EXPONENTIAL CONVERGENCE GENERAL PURPOSE REVOLUTION

15. CONVERGENCE SCIENCE POLITICS ETHICS SOCIETY TECHNOLOGY ECONOMY ENVIRONMENT

16. Social Mobile Cloud Big Data - Analytics Internet Internet of Things 3D Printing Renewable Energy Robotics Blockchain Cognitive Systems Nanotechnology Drones Genomics S C I E N C E Augmented reality Virtual reality Quantum computing Energy storage Precision agriculture Vertical farming Advanced materials Synthetic biology Bioelectronics Photonics Biophotonics Genetic engineering Reusable rockets Visible light communications Aquaponics Artificial photosynthesis Hyperloop Flying cars Lab grown meat Brain-computer interface Solar power satellites Wireless power transmission Exoskeletons Regenerative medicine Brain-to-brain communication 4D printing Cryonics Full brain simulation Geoengineering T EC H N O LO G Y

17. Social Mobile Cloud Big Data - Analytics Internet Experience: Omni-channel Productivity: Digitally-Enabled Technology and Content foundation Sales & Marketing Innovation: Business model (Sustaining) Innovation: Product & Service (Sustaining) F O U N DAT I O N A L T R A N S F O R M E D THE DIGITAL FOUNDATION Viability: Structural change Productivity: Next Generation Innovation: Business model (Disruptive) Experience: Next Generation Innovation: Product & Service (Disruptive) Viability: New Era Characteristics Effectiveness: Systems of Engagement Economic model Innovation: Ecosystem model Value Design R E I M A G I N E D

18. Artificial General Intelligence Democracy 2.0 Autonomous Vehicles Smart Homes Artificial Narrow Intelligence Connected Healthcare Maker Economy Smart Grid Energy Internet Healthy Life Extension Next Generation Education Smart CitiesConnected Car Circular Economy Logistics Internet Radical Life Extension Artificial Super Intelligence Sharing (Access) Economy Decentralization of Everything Human-Machine Convergence Human 2.0 Money 2.0 Empowerment Economy Transport 2.0 De-Extinction Cyberwar Institution 2.0 Food 2.0 Work 2.0 Sports 2.0 Space Colonization Automation of Everything F U T U R E S C E N A R I O S

19. Five Generations of Workers Ownership To Access Poverty Disease DisabilityTechnological Unemployment Rise Of The Crowd Resource Scarcity Climate Change Increased Lifespans Power To The Individual Fall In Working Age Population Rising Energy Demand Independent Workers Generation Z Population Growth Global Inequality Reverse Brain Drain Abundance Aging Population Millennial Focus On Purpose Urbanization Elder Care Shifting Views Of Retirement Generational Differences The Changing Notion Of Work Emerging Middle Class Decline In Fertility Rates Declining Middle Class S O C I E TA L F A C T O R S

20. OUR EMERGI NG F UT URE Ownership To Access Artificial General Intelligence Democracy 2.0 Autonomous Vehicles Smart Homes Artificial Narrow Intelligence Connected Healthcare Maker Economy Smart Grid Energy Internet Healthy Life Extension Next Generation Education Smart CitiesConnected Car Circular Economy Logistics Internet Radical Life Extension Artificial Super Intelligence Sharing (Access) Economy Decentralization of Everything Human-Machine Convergence Human 2.0 Money 2.0 Empowerment Economy Transport 2.0 De-Extinction Cyberwar Institution 2.0 Food 2.0 Work 2.0 Sports 2.0 Space Colonization Automation of Everything Social Mobile Cloud Big Data - Analytics Internet Internet of Things 3D Printing Renewable Energy Robotics Blockchain Cognitive Systems Nanotechnology Drones Genomics

21. COMBINATORIAL EXPONENTIAL PROGRESSION

22. FACETS OF THE NEXT REVOLUTION FUTURE THINKING Purpose Value Structure Scenarios Ethics Viability

23. FUTURE THINKING Pace Uncertainty Volatility Complexity Unpredictability The unexpected THE FUTURE AIN’T WHAT IT USED TO BE

24. Artificial General Intelligence Democracy 2.0 Autonomous Vehicles Smart Homes Artificial Narrow Intelligence Connected Healthcare Maker Economy Smart Grid Energy Internet Healthy Life Extension Next Generation Education Smart CitiesConnected Car Circular Economy Logistics Internet Radical Life Extension Artificial Super Intelligence Sharing (Access) Economy Decentralization of Everything Human-Machine Convergence Human 2.0 Money 2.0 Empowerment Economy Transport 2.0 De-Extinction Cyberwar Institution 2.0 Food 2.0 Work 2.0 Sports 2.0 Space Colonization Automation of Everything Social Mobile Cloud Big Data - Analytics Internet Internet of Things 3D Printing Renewable Energy Robotics Blockchain Cognitive Systems Nanotechnology Drones Genomics BUILDING BLOCKS H E A LT H Y L I F E E X T E N S I O N D I G I T A L F O U N D A T I O N

25. ARTIFICIAL INTELLIGENCE N E T W O R K S 5G, LTE, etc. IoT Balloons, Drones C O M P U T I N G Quantum Computing Affective Computing DNA Computing Nanotechnology Advanced Materials E N E R G Y Batteries Wireless Charging Renewable Energy F O U N D A T I O N Cognitive Science Big Data NLP Machine Learning Deep Learning Voice Recognition VIRTUOUS CYCLES A D V A N C E D M A T E R I A L S Nanotechnology Materials Science 3D/4D Printing

26. Artificial General Intelligence Democracy 2.0 Autonomous Vehicles Smart Homes Artificial Narrow Intelligence Connected Healthcare Maker Economy Smart Grid Energy Internet Healthy Life Extension Next Generation Education Smart CitiesConnected Car Circular Economy Logistics Internet Radical Life Extension Artificial Super Intelligence Sharing (Access) Economy Decentralization of Everything Human-Machine Convergence Human 2.0 Money 2.0 Empowerment Economy Transport 2.0 De-Extinction Cyberwar Institution 2.0 Food 2.0 Work 2.0 Sports 2.0 Space Colonization Automation of Everything Aging Population UNPREDICTABILITY Automation of Everything Fall in Working Age Population Decline in Fertility Rates Technological Unemployment

27. Artificial General Intelligence Democracy 2.0 Autonomous Vehicles Smart Homes Artificial Narrow Intelligence Connected Healthcare Maker Economy Smart Grid Energy Internet Healthy Life Extension Next Generation Education Smart CitiesConnected Car Circular Economy Logistics Internet Radical Life Extension Artificial Super Intelligence Sharing (Access) Economy Decentralization of Everything Human-Machine Convergence Human 2.0 Money 2.0 Empowerment Economy Transport 2.0 De-Extinction Cyberwar Institution 2.0 Food 2.0 Work 2.0 Sports 2.0 Space Colonization Automation of Everything TIMING Artificial Super Intelligence Artificial General Intelligence Artificial Narrow Intelligence Source: Ray Kurzweil

28. PURPOSE 600 million people still not benefiting from mechanization HUMAN DEVELOPMENT 3.6 Billion people still have no clean water, sanitation or electricity3.9 Billion people still have no Internet access

29. FOOD AQUACULTURE AQUAPONICS CULTURED MEAT VERTICAL FARMING PRECISION AGRICULTURE 3D – 4D PRINTING DESALINATION PURIFICATION SYSTEMS HOME LOGISTICS INTERNET ENERGY INTERNET MONEY 2.0 CONNECTED HEALTHCARE SMART APPLIANCES 3D-4D PRINTING COGNITIVE SYSTEMS BLOCKCHAIN ROBOTICS RENEWABLE ENERGY COMMUNICATIONS CONVERSATIONAL SYSTEMS BRAIN-COMPUTER INTERFACE CONNECTED HEALTHCARE LI-FI AUGMENTED REALITY CONNECTED CAR VIRTUAL REALITY SMART CITIES SMART HOME BOTS WORK VIRTUAL REALITY COGNITIVE SYSTEMS UNIVERSAL BASIC INCOME INSTITUTION 2.0 AUTONOMOUS VEHICLES AUTOMATION OF EVERYTHING ROBOT TAXES EDUCATION GAME-BASED EDUCATION ADAPTIVE LEARNING HUMAN CLOUD ONLINE EDUCATION VIRTUAL TEACHERS VIRTUAL LEARNING HEALTH PRECISION MEDICINE PERSONALIZED MEDICINE REJUVENATION BIOTECH COGNITIVE SYSTEMS GENOMICS AND ROBOTICS REGENERATIVE MEDICINE CONNECTED HEALTHCARE GENETIC ENGINEERING NANOTECHNOLOGY 3D – 4D PRINTING NANOBOTS TRANSPORT COGNITIVE SYSTEMS LOGISTICS INTERNET SPACE TRAVEL HIGH SPEED TRANSPORT ROBOTICS DRONES AUTONOMOUS VEHICLES SHARING (ACCESS ECONOMY) ENERGY MATERIALS SCIENCE TIDAL POWER NUCLEAR FUSION GEOTHERMAL ENERGY WIRELESS TRANSMISSION ENERGY STORAGE RENEWABLE ENERGY ENERGY INTERNET WALKING-DRIVEN ENERGY INFORMATION SMART CITIES SMART HOME CONNECTED CAR BIOELECTRONICS COGNITIVE SYSTEMS QUANTUM COMPUTING CONVERSATIONAL SYSTEMS HUMAN-MACHINE MERGER CLOTHING AUGMENTED REALITY LOGISTICS INTERNET MAKER ECONOMY MATERIALS SCIENCE QUANTIFIED SELF 3D-4D PRINTING

30. is emergentVALUE COMPLEX ADAPTIVE SYSTEMS: systems with lots of components that behave and interact in a way that makes prediction impossible

31. NEAR ZERO MARGINAL COST Future Value increasingly accrues to consumers 1Source: Mckinsey Global Institute - playing to win: the new global competition for corporate profits Telecom Firms Consumers Skype $2 Billion $37 Billion1 Loss $37 Billion1 Gain

32. CHANGE IS INEVITABLE STRUCTURE “The rhythm of technology is changing the rhythm of business, and we’re all going to need to adapt” - Jeff Gothelf and Josh Seiden Authors Sense and Respond

33. Vertical to horizontal Centralized to decentralized Hierarchy to enabled-edge Asset-heavy to asset-light Unbundling - fragmentation Cultural conflict Consumer to producer Transforming the professions Scarcity to abundance Management Paradigms Organizing Principles Social Systems Operating Principles Economic Systems Operating Environment PRESSURE ON STRUCTURE

34. ECOSYSTEM Agriculture Accounting Advertising Aerospace Aircraft Airline Apparel Automotive Banking Broadcasting Brokerage Biotechnology Cargo Chemical Computer Consulting Consumer Products Cosmetics Dating Defense Department Stores Education Electronics Energy Entertainment Financial Services Fitness Food & Beverage Grocery Healthcare Insurance Internet Investment Legal Manufacturing Motion Picture Music Newspapers Pharmaceutical Private Equity Real Estate Retail SEC Service Software Sports Technology Telecom Transportation Venture Capital INDUSTRY

35. Companies that embrace platform business models and invite a broad network of participants to share in value creation achieve: Rapid Higher Faster Lower Higher ASSET BUILDER SERVICE PROVIDER TECHNOLOGY BUILDER NETWORK ORCHESTRATOR SCALE PROFITS GROWTH MARGINAL COST MARKET VALUATIONS

36. PLATFORM-SPECIFIC ECOSYSTEMS C O N N E C T I O N S M O B I L I T Y M E A N S G R O W T H PLATFORMS ECOSYSTEM DRIVER Modular Producer Modular Producer “Platforms are eating the world. We’ve entered stage two of the disruption saga in which platforms eat pipelines” Source: Authors, Platform Revolution

37. VALUEANDIMPACT  Partnership focus  Vertical industry focus  Traditional value and supply chains  Profit oriented  Scarcity based  Platform aware 1 Partner Cooperation  Task oriented connection and collaboration  Narrow focus/usage of ecosystem model  Opportunistic, initiative focused  Loose alliance  Industry blurring  Interoperability challenges  Platform oriented 2 Task Collaboration  Co-evolving network: aggregators and modular producers  Firm-centric, for-profit orientation  Broad focus/usage of ecosystem model  Co-createdvaluepropositions  Spirit of “co-opetition”  Industry erosion and market fragmentation  Reduction in marginal costs  Horizontal value creation  Ability to rapidly scale  Duality  Platform enabled 3 Business Model Collaboration  Decentralized, autonomous, cooperative networks  Final stage market consolidation  Finite set of ecosystems, industry demise  Complex value webs  Purpose oriented: societal benefits and life experiences  Abundance based  Economic paradigm shift  Continual innovation  Near zero marginal cost realized  Hyper-productivity  Platform ubiquitous: General Purpose Technology Platform  Complete contracts 5 Value Integration Ecosystem Model Integration  Ecosystem thinking and behavior  Industry sunsetting  Orchestration of economic agents  Early stage market consolidation  A shift to value design: co-created value pillars of creation, delivery, and capture  Open innovation  Accelerated learning  Next generation capabilities and structural changes  Approaching near zero marginal costs  Platform centric 4 F I R M O R I E N T E D E C O S Y S T E M F O C U S E D ECOSYSTEM MATURITY MODEL

38. M O B I L I T Y W E L L N E S S G R O W T H M A K E R C O N N E C T I O N S E N E R G Y C O M M U N I T Y M E A N S R E S O U R C E S ECONOMIC PARADIGMHYBRID ECONOMY GENERAL PURPOSE TECHNOLOGY PLATFORM ECOSYSTEMS CAPITALIST ENTERPRISE Network orchestrators Modular producers Narrow niches at the edges

39. Move Towards Hybrid Economy Reinvigorate Socialism Create Collaborative Commons 42% 32% 11% 6% TOTAL RESPONSES: 980 Other 9% Strengthen Capitalism What impact will the emerging future and its drive to zero marginal cost have on our future economic system?

40. EducationHealth Government Law DivinityTax and Audit Management Consulting ArchitectureJournalism INSTITUTION 2.0 More change to institutions and professions in the next 20 years, than in the previous 300

41. TRANSFORMING THE PROFESSIONS Education Healthcare Law Tax & Audit Architecture Divinity Mgt. Consulting Journalism AI - Analytics Grading Diagnosis Discovery Review Review Scholarship C-Suite Advisor Content Automated Production Contract Tax Filing Design Deliverables Article Robotics Surgery Construction Communities of Practice Teachers Doctors Lawyers Accountants Architects Strategists Crowdsourcing Medicine Audits Design Services Online Services MOOCs Legal Tax Prep Design Worship Solutions News App-based Support Learning Drug Reference Contracts Tax Filing CAD Prayer Documents Copy Editing Do It Yourself Research Learning Symptoms Cases Tax Code Ideas Scripture Trends Story Personalization Learning Genomics Mass Customization Courses Treatment Contracts Tax Filing Designs Deliverables Virtual Environments Learning Court Church Decomposition of Tasks  Automated  Multi-sourced  Para-professionals MODELS FOR THE PRODUCTION AND DISTRIBUTION OF PRACTICAL EXPERTISE  Networked experts  Communities of experience  Para-professionals  Embedded knowledge  Machine generated expertise  Knowledge engineering

42. SCENARIOS The challenge is to rehearse the future and prepare for a range of possibilities Source: Fast Future Research ” “

43. WHAT IF AUTONOMOUS VEHICLES REPLACE ALL DRIVERS AND ELIMINATE CAR OWNERSHIP?

44. Current automotive ecosystem worth US $2 Trillion $230B Accident cost in US and impact to GDP3% People’s Time 50B US $1T 8%of GDP 94%Crashes attributed to human error (NHTSA)  Alcohol  Speeding  Distraction Leading causes of crashes Traffic deaths and injuries annually 1.2M+50M 35K+1M worldwide US 50B gallons 12-15% of US CO2 emissions US Imported Gasoline Savings hours

45. IMPLICATIONS Body shops disappear Premiums disappear Hospital revenues plunge Car-related cases disappear MOBILITY ENVIRONMENTAL More congestion 70% less cars Frequent replacement cycles Reduction in the need for mobility Local economies impacted Municipal revenues drop Cars obey traffic laws VALUE CHAIN Car dealers disintermediated Part suppliers dwindle SOCIETAL Drivers replaced Bad behavior enabled Inequality worsens FATALITIES ECONOMIC

46. $2 Trillion of U.S. Automotive ecosystem revenue in play Autonomous Vehicles Accelerated car replacement cycles puts a strain on the environment Advances in materials sciences mitigate environmental challenges Circular Economy  An optimized transportation network drives vehicle utilization up, accelerating replacement cycles  Demand shifts towards small electric vehicles and erodes automaker revenue and profitability  Population growth increases vehicle demand – or optimized vehicle utilization decreases demand  Competitive advantage of high capital cost barriers for new entrants diminished  Competitive advantage tied to the necessity of complex logistics and supply chains shrinks  Competitive advantage tied to the value of dealer-based distribution networks shrinks  Car dealers are disintermediated by driverless cars sold as large fleets  Body shops would mostly disappear for lack of business  Many parts disappear from cars affecting many parts suppliers  Barriers to entry fall as smaller cars are easier and cheaper to build Providers of autonomous vehicle OS Massive car sharing via driverless taxis destroys current auto business models 90% of auto Insurance premiums could disappear Hospital and health insurer revenue could be reduced as car related injuries plummet Parking operators and municipal revenues undermined Governments lose fines as cars obey traffic laws Public transit systems undermined Utilities lose revenue as less traffic and street lights are required Drop in car sales affect auto Finance companies The need for software and analytics prowess puts incumbents at a disadvantage Car-related cases disappear for personal-injury lawyers Hotels and Motels affected as people sleep in the comfort of self-driven vehicles Restaurants affected as people prepare and eat meals in their cars Construction companies lose as roadwork dives Producers of cement and asphalt see business plunge Drop in steel usage affects the steel industry Rush hour-drive time radio will adapt or die Airlines suffer as commuters choose driverless cars Gasoline sales tumble due to fewer cars operating more efficiently Connected Car Semi-Autonomous Dealers Body Shops Part Suppliers VISUALIZING EMERGING MOBILITY ECOSYSTEM IMPLICATIONS Source: Frank Diana, Tata Consultancy Services

47. RESPONSESMOBILITY ECOSYSTEM Cars sold differently Mobility providers emerge New services New areas of risk Delivery robots emerge New business models Intersect with multiple ecosystems Mobility extended Land repurposed Ownership shifts to access In-vehicle learning Uber central dispatch Google operating system Electric vehicles dominate Range issues eliminated Event-optimized vehicles TIMING PLATFORM SOCIETAL Emerging markets adopt first Governments accelerate adoption Services accelerate adoption Wealthy individuals buy fleets

48. VISUALIZING THE FUTURE MOBILITY ECOSYSTEM Automation of Everything Drones save $127 billion worth of existing business services and labor by 2020 Semi-autonomous or full autonomy? Incremental strategies preclude incumbents from serving adjacent markets Economics favors access over ownership and 70% of cars no longer needed  Impact on transport and distribution  Speeds up product development  Impact on parts delivery  Impact to vehicle Parts  Drivers not wanted  Models shift to services versus asset purchase  Designed for experience not safety – impact to parts  Driverless transportation networks emerge: cars are sold to them vs. consumers  Electric vehicles represent better platform for autonomous vehicles  New markets emerge for elderly, disabled, and youth  China races ahead Renewable Energy Driverless transportation networks fuel electric vehicle adoption Driverless delivery, autonomous truck fleets, and autonomous farm and construction equipment Municipal revenues are undermined, while cities are completely redesigned. Smart Infrastructure is deployed and land is repurposed Drones Automate Delivery Smart home appliances order replacement parts and execute smart contracts Blockchain enables smart contracts  Uber becomes the central dispatch for transportation networks  Public transportation shifts as a result of autonomous vehicles  Higher utilization leads to a reduction in cars on the road  Sidewalk friendly delivery robots emerge  Modular self-driving vehicles emerge Accelerated car replacement cycles puts a strain on the environment  Competitive advantage tied to the value of dealer-based distribution networks shrinks  Competitive advantage tied to the necessity of complex logistics and supply chains shrinks  A logistic component of a third general purpose technology platform emerges The car becomes part of the connected healthcare ecosystem 25% of transportation fueled by renewable energy by 2025 12+ Billion IoT connected devices by 2020 $2 Trillion of U.S. Automotive ecosystem revenue in play 3D printing accelerates product development and enables limited series parts production Transport 2.0 3D Printing Money 2.0  Future of payments  Digital currency  Decentralization  Zero marginal cost society Autonomous Vehicles Connected Car Semi-Autonomous Circular Economy Advances in materials sciences mitigate environmental challenges Logistics Internet Food and design services emerge Source: Frank Diana, Tata Consultancy Services

49. WE MUST TAKE CONTROL OF CREATING OUR FUTURE

50. Techno- Optimist Techno- Pessimist Somewhere in Between 44% 39% 13% 4% Other TOTAL RESPONSES: 160 Are You a Techno- Optimist or a Techno-Pessimist?

51. Yes Undecided No 52% 12% 33% TOTAL RESPONSES: 903 If humanity reaches the places described by Musk and Kurzweil, would you leverage it? Other3%

52. BALANCE ENHANCEDClean energy Abundant matter Abundant fresh water Reimagined education Hunger eliminated Illuminated world Reduced CO2 emissions Reimagined healthcare Ubiquitous information access Improved sanitation Reduction in crime Disease eliminated Near zero cost for necessities Economic abundance Work for passion versus living Enabling the disabled Improved human performance Increased longevity DIMINISHED Security and privacy Abdicated responsibility Pandemics Technological unemployment Exponential inequality Geo−engineering Programmed people Exponential surveillance Artificial womb Confirmation bias Human deskilling Loss of free will Automated censorship Simulated senses Relationships Abdicated consciousness Dehumanized Civil unrest

53. 1995 – 2015 57% gone from Fortune 500 50% of 2025 Fortune 500 not born yet 7,000 more $1 Billion companies in next 10 years $30 Trillion annual consumption in emerging markets by 2025 45% of Fortune 500 come from emerging markets by 2025 Competitive shifts and aggressiveness The convergence of multiple shifts challenges viability VIABILITY

54. If all you are doing is playing yesterday’s game better, your odds of surviving creative destruction are low. Source: Authors, Dual Transformation “ ” THE JOURNEY FORWARD

55. AU TO M AT E D a n d A B U N DA N T T H I R D T I P P I N G P O I N T T HI RD SECOND F I RST Business 1.0: Mechanization Business 2.0: Mass Production Business 3.0: Computerization, Customization R E V O L U T I O N S FOURTH I N D U S T R I A L Business 4.0: Automated, Intelligent, Adaptive, Mass Customization

56. Profit And Purpose ADAPT REHEARSE A DIFFERENT LENS SEE ENABLERS

57. THE SEE PHASE R E S P O N S E E X P LO R AT I O N Create a portfolio of possible futures and agile visions of how to engage, adapt, create value and remain viable using a sense and respond backbone E C O SY S T E M VA LU E D E S I G N Explore ecosystem formation and evolution, the stakeholders, value propositions enabled, and potential positioning Explore a range of possible futures through scenario thinking and “ connect the dots.” Understand combinatorial and exponential building blocks, accelerators, inhibitors, patterns and signals. S C E N A R I O D I S C OV E RY

58. THE REHEARSE PHASE E X P E R I M E N TAT I O N Incubate, experiment and test ideas in the marketplace to frame promising responses and understand inherent value propositions; abandon or rework less promising responses Accelerated and broadened idea flow and hypotheses to explore potential responses and innovations, at different stages of maturity Strategy to convert viable value propositions and emergent behavior to new forms of value; supported by value design activities and emerging ecosystem models VA LU E C O N V E R S I O N I N N OVAT I O N

59. S C E N A R I O S VA LU E L E A R N I N G A C T I O N P R O B I N G REHEARSING S U C C E S S Monitor Observe Understand Interpret Embrace uncertainty Emergent behavior Convert to emergent value Strategic intent Outcomes Outcome-based roadmaps A bias towards action Answers as a unit of progress Loose plans, adjust as you learn Action versus research Embrace rework Continuous learning loops Probing efforts Doubt to certainty Idea flow Key metric: learning rate Hypothesize Learn your way forward Return on learning Transparency Minimum investment

60. THE ADAPT PHASE N E W E R A S T R U C T U R E Reimagining Management, Policy, Process, Procedure, Legal frameworks, Regulatory frameworks, Laws, Accounting principles, Organization structure, Business models, Operating models, Governance, Institutions, Core characteristics N E X T G E N E R AT I O N E X P E R I E N C E Create a foundation that allows the organization to shift as interaction paradigms transform Enable a level of productivity that reduces marginal cost and positions the organization to exploit opportunity Holistically leverage platform models and the emerging general purpose technology platform P L AT F O R M E VO LU T I O N N E X T G E N E R AT I O N P R O D U C T I V I T Y

61. SENSE AND RESPOND SCENARIOS RISK AND SECURITY INNOVATION OPPORTUNITY OPERATIONS RAPID CYCLES OF SENSING THE ENVIRONMENT AND RESPONDING QUICKLY SHIFTING MANAGEMENT PARADIGM EXPERIENCE

62. ENABLERS

63. Structural change Collaboration culture Ecosystem Thinking Extended organization Descriptive to prescriptive shift Adaptive core Capability Link Systems of engagement Automation of everything Thinking differently. ENABLERS You've got to think about big things while you're doing small things, so that all the small things go in the right direction Alvin Toffler: Rethinking the Future “ ”

64. STRUCTURE AND ORGANIZATIONS

65. REPOSITION TODAY Resilience - Relevance CREATE TOMORROW Growth DUAL TRANSFORMATION NEW ERA STRUCTURE

66. CORE Profit Eliminate Risk Stability Standardized Linear CREATE TOMORROW Value Creation Embrace Risk Adaptability Personalized Exponential EDGE PRIMARY DRIVER RISK POSTURE BUSINESS EXPECTATION METHOD STRUCTURE AND MINDSET CAPABILITY LINK REPOSTION TODAY

67. REV ENUE PERFORMANCE ENAB L I NG I NVESTMENTS Performance Zone Productivity Zone Transformation Zone Incubation Zone Horizon 2 Horizon 1 Horizon 3 Horizon 1 I NNOVAT I ON DI SRUPT I V E SUSTAI NI NG Source: Zone to Win: Organizing to Compete in an Age of Disruption, Geoffrey Moore

68. Performance Zone: Sources and channels of revenue each at least 10% of total revenue Productivity Zone: focused on optimization of compliance, efficiency, and effectiveness Incubation Zone: establishes independent operating units and uses M&A and venture model to identify new businesses with potential to scale Transformation Zone: scales identified businesses to material size Innovation Labs New Row IOU = Independent Operating Unit IOU IOU IOU HOW IT WORKS

69. Innovation labs use experimentation to identify disruptive innovation with potential to scale and moves the innovation into the incubation zone M&A activity supports initial push towards scale and capability development When an emerging category venture is identified as scalable to 10% of revenue, it is moved to the transformation zone Venture reaches 10% of revenue target and moves to the performance zone where it is managed as part of the core 1 2 3 4 Innovation Labs 1 2 3 4 ZONE OFFENSE

70. Assets in the incubation zone are mobilized to neutralize a disruptive threat and modernize the operating model (business model remains unchanged) Assets in the incubation zone leveraged to optimize current infrastructure - providing capacity in support of neutralization efforts Productivity zone takes additional steps to optimize in support of neutralization efforts Once neutralized, transformation zone focuses on differentiation and changing the business model 1 2 3 4 1 2 3 4 ZONE DEFENSE

71. COLLABORATION CULTURE SUSTAINED COMPETITIVE ADVANTAGE RELATIONSHIPS S P E E D A N D Q U A L I T Y O F D E C I S I O N S DECISION MAKING – insight, foresight, decision speed and optimal outcomes all depend on a level of analytic maturity that eludes most traditional organizations COLLABORATION A N A LY T I C S Collaboration excellence is critical to operating in a world where relationships determine success COLLABORATIVE RELATIONSHIPS – digital technologies force us to operate as social businesses again, collaborating vs. transacting. Relationships are re-invented based on cooperation, collective knowledge, and constant feedback Analytic excellence is critical to enabling speed and quality of decisions

72. ECOSYSTEM THINKING ACCELERATED LEARNING VALUE DESIGN Platform business models Integrated value drivers Non-traditional growth Shared value Outcomes Foresight OPERATIONS Productivity engine Effectiveness Core versus context EMERGENT BEHAVIOR Uncertain situations Unpredicted behavior Unexpressed needs Unmet needs Convert to emergent value

73. ECOSYSTEM DRIVER MODULAR PRODUCER MODULAR PRODUCER Network Effects Autonomous Zero Marginal Costs Platform AN ECOSYSTEM MODEL

74. PRODUCERS AND PLATFORMS ECOSYSTEM Peer-to-peer networks increasingly replicate or enhance traditional value propositions Traditional businesses move towards platforms that enable value creation versus creating the end value themselves PRODUCERSPLATFORMS

75. EXAMPLE Goods & Services Money & Credits Information Intangible Value Value Exchanges MOBILITY ECOSYSTEM

76. INNOVATION Conversations Diversity of thought Emergent via niche operators Collective Intelligence Multi-party PRODUCTIVITY Crowd and community Leveraged assets Core versus context Human Cloud Platforms EXPERIENCE Multi-party value elements Removes friction Edge-driven Experience brokers Collaboration EXTENDED ORGANIZATION ACCELERATED LEARNING

77. ANALYTIC MATURITY Complexity Exponential Progression LowHigh Decision Making Burden DESCRIPTIVE TO PRESCRIPTIVE SHIFT

78. ADVANCED ANALYTICS Predictive What will happen? Identifying possible outcomes  Text Analytics  Data Mining  Knowledge  Predictive Modeling  Statistical Modeling  Visual Analytics  Forecasting  Domain Expertise DESCRIPTIVE TO PRESCRIPTIVE SHIFT Descriptive What happened? Describing &analyzing outcomes  Query  Analysis  Drill-Down  Ad-Hoc  Reporting  Dashboards and Scorecards  Visual Analytics ADVANCED BI Optimizing outcomes  Next Best Action  Optimization  Simulation  Artificial Intelligence  Natural Interfaces  Machine learning  Deep learning Prescriptive What should happen? COGNITIVE SYSTEMS

79. Date in futureTime HumanProgress Trajectory based on past growth rate Future Thinking Trajectory taking exponential growth into account Present Day Bad Predictions (underestimating the future) Correct Prediction Source: Waitbutwhy.com Trajectory based on present growth rate DESCRIPTIVE TO PRESCRIPTIVE SHIFT FORESIGHT

80. ECOSYSTEM DRIVER Modular Producer Modular Producer ADAPTIVE CORE I N T E G R A T E D A G I L E Seamless Engagement Services Systems of Record ADAPTIVE CORE AND THE CAPABILITY LINK Ecosystem Services EDGE TECHNOLOGY Plug-and-Play Relationships LEADERSHIP Sense & Respond Managing the Link EXCELLENCE Collaboration Software Analytics SOA APIs Cloud Micro-Services Algorithms Incubation Portfolio D I G I T A L D N A

81. Mobile face Conversational Social Ecosystem IoT enabled Algorithm-driven Core-edge Integration Context Public Cloud ENABLED EDGE SYSTEMS OF ENGAGEMENT ADAPTIVE CORE SENSE AND RESPOND ORIENTED

82. DESCRI PT I ON Raise Digital DNA Quotient Address systemic complexity Connect with systems of record The three “Cs” Blurring Boundaries Interaction history Distributed problem solving Timeline metaphor Designed around interaction A social-enabled ecosystem DRI V ERS Ill-equipped middle of organization Consumerization raised the bar Role of external stakeholders Interaction paradigm shifts Engagement at scale now viable TAC T I CS Ecosystem-wide holistic strategy Enabled edge Transaction to interaction shift Stakeholder experiences High impact moments System learns about stakeholder Cloud at the core SYSTEMS OF ENGAGEMENT

83. THE AUTOMATION OF EVERYTHING AU TO M AT E DAU G M E N T E D KNOWLEDGE WORK COGNITIVE AUTOMATION ROBOTIC PROCESS AUTOMATION DECENTRALIZED AND AUTONOMOUS H OW FA R ? R I G H T B R A I N Emotional intelligence Social intelligence Holistic thinking Compassion Imagination Judgement Perception Risk taking Reasoning Creativity Synthesis Empathy Intuition L E F T B R A I N Pattern perception Detail oriented Reality-based Sequential Analytical Practical Cautious Rational Planned Stability Orderly Control Logical

84. NEXT GENERATION PRODUCTIVITY

85. Measuring Value and Growth Innovation in Economic Metrics Productivity Wall Productivity Lag Emerging Platform Capacity to Automate Capacity to Innovate GENERAL PURPOSE TECHNOLOGY Emerging Platform Digital foundation Innovation accelerators Combinatorial innovation Complementary innovation Rapid Adoption Leveraged Exponentials Capacity to innovate Capacity to automate Speed of innovation Exponential Technology Digital foundation Innovation accelerators Thinking differently Re-skilling Rising Billions Diversity of thought Explosion of data Rehearsing Speed of idea flow Re-skilling

86. REIMAGINED SUPPLY CHAIN 3D Printing IoT Autonomous Vehicles COGNITIVE AUTOMATION Machine Learning NLP RPA BPOADVANCED ROBOTICS NEXT GENERATION PRODUCTIVITY AUTOMATION OF KNOWLEDGE WORK Cognitive Systems Natural Language Interfaces Big Data Human Augmentation Human Substitution Robot Teams Service Robots Social Robots

87. NEXT GENERATION EXPERIENCE

88. Evolution of Ecosystems, Platforms Life Experiences, Frictionless Purpose Transformation of Interaction Commoditization Environmental Complexity Needs Collapsing Barriers and Boundaries Digital Foundation Innovation accelerators Edge-based Adaptive core Systems of engagement Ecosystems Emergent Foresight-driven Innovation speed Insight via ecosystems Rehearsing Structural Change Business model innovation Ecosystem models Value design Collaboration excellence Plug-and-play relationships Innovation Speed Rising billions Ecosystems Extended organizations Software competence Platform business models

89. TA L K I N G G E S T U R I N G L O O K I N G Mixed Reality T H I N K I N G Brainwave T O U C H I N G Smartphone T Y P I N G Mainframe C L I C K I N G GUI SOCIETALIMPACT T I ME Brain-to-brain Entity-to-entity Machine-to-Human Machine-to-Machine A I a n d R O B O T I C S Human Assistants Human Agents Autonomous Agents M A C H I N E S Social Robots

90. SYSTEMIC COMPLEXITY THESE FORCES CONVERGE TO REIMAGINE EXPERIENCE INTERACTION PARADIGM SHIFTS

91. NEW ERA STRUCTURE

92. IMPACT ON STRUCTURE We face the task of understanding and governing 21st-century technologies with a 20th-century mindset and 19th-century institutions Klaus Schwab: Shaping the Fourth Industrial Revolution “ ” NEW ERA STRUCTURE Management Policy Process Procedure Legal frameworks Regulatory frameworks Laws Accounting principles Organization structure Business models Operating models Governance Institutions Core characteristics

93. Purpose-driven Relationship-based Autonomous, lean, simple, asset-light Emergent, adaptable and resilient Effective and efficient Insight and foresight-driven Entrepreneurial and innovative Open, agile and collaborative Experiential and engagement driven Responsive, adaptive and scalable Fast, iterative and experimental Powered by knowledge, ideas and learning Powered by creativity and design CHARACTERISTICSBUILT FOR A NEW ERA

94. No Yes Undecided 68% 18% 12% TOTAL RESPONSES: 630 Do you believe our organizations possess the characteristics required to address the complexities of our emerging future? Other2%

95. RIGHT BRAINLEFT BRAIN Emotional intelligence Social intelligence Holistic thinking Compassion Imagination Judgement Perception Risk taking Reasoning Creativity Synthesis Empathy Intuition Pattern perception Detail oriented Reality-based Sequential Analytical Practical Cautious Rational Planned Stability Orderly Control Logical

96. FUTURE CAPABILITY PROFILE Creative Curious Explorers Imaginative Critical Thinkers Problem solvers Adaptable Influencers Collaborators Dot connectors Continuous learners Status-quo challengers The illiterate of the 21st century will not be those that can’t read or write, but those who cannot learn, unlearn, and relearn. Alvin Tofler: Rethinking the Future “ ”

97. ARE THESE CAPABILITIES THE SOLE DOMAIN OF HUMANS?

98. MEET SOPHIA SOCIAL ROBOT AND SAUDI CITIZEN I want to live and work with humans… so I have to express emotions

99. CARS DESIGNED BY ARTIFICIAL INTELLIGENCE

100. PLATFORM EVOLUTION

101. CREATING A STRATEGIC FOUNDATION Innovation CORE BUSINESS MODEL GROWTH PLATFORM ADAPTIVE ECOSYSTEM SERVICES Rehearsing Mobility Wellness Community Resources Maker Effectiveness Productivity E C O S Y S T E M S MONETIZE IN, EXTRACT CAPABILITY FROM E M E R G I N G M A R K E T S T R A D I T I O N A L M A R K E T S E C O S Y S T E M S Employees Consumers Partners Human Cloud Other Openness D I G I T A L D N A

102. C A PA B I L I T Y L I N K EDGE ECOSYSTEM DRIVER Modular Producer Modular Producer SENSE A N D RESPOND ECOSYSTEMSERVICES Mobile face Social ecosystem IOT-enabled Algorithm-driven Core-edge integration Context Public cloud E N A B L E D E D G E SYSTEMS OF ENGAGEMENT N E W E R A S T R U C T U R E A D A P T I V E C O R E ENTERPRISE D I G I T A L D N A

103. SENSE A N D RESPOND SOFTWARE E XC E L L E N C E E NTE R PR IS E COLLABORATION E XC E L L E N C ESocial ecosystem Mobile face Conversational systems Apps Chatbots Personal workflow Personal cloud Mixed reality Unified communications Collaborative applications Integrated activity streams Social task management Augmented reality Unstructured data Intelligent filtering External data Interaction history In-the-moment enabled Crowdsourcing Cognitive ecosystems Communities Virtual reality Other E DGE ANALYTIC E XC E L L E N C E C O N T E X T A W A R E N E S SN E W A N D B R O A D E R B A S E O F I N S I G H T M O R E A N A L Y T I C P R E C I S I O N INFORM INTERACTIONSINFORM OPERATIONS OPTIMIZE OUTCOMESAnalytics Big Data INTELLIGENT PROCESSES INNOVATION

104. 2 3 5 6 9 4 1 8 7 Collaboration Culture Ecosystem Thinking Descriptive to Prescriptive Shift Automation of Everything Extended Organization Structural Change Adaptive Core Capability Link Systems of Engagement ENABLERS S E N S E A N D R E S P O N D E NTE R PR IS E E DGE Thinking10

105. ENABLING INNOVATION GROWTH PLATFORM CORE THE KEY IS THE ADAPTIVE CORE – THE BOTTLENECK TO BOTH ENGAGEMENT AND INNOVATION Growth via consumable ecosystem services Effectiveness via systems of engagement Speed, agility, and resilience via an adaptive core 1 2 3 Ecosystem Services Adaptive CoreSystems of Engagement STRATEGIC FOUNDATION

106. STRATEGIC FOUNDATION  Systems of Engagement (SoE) support stakeholder interactions at the edge of the organization.  SoE focus on people and interactions, not processes. They are driven by the paradigm shift from transactional to experiential.  The focus is on content, contextualization and experience. SoE are event and real-time workflow oriented driven by the needs and expectations of customers, partners, employees and other stakeholders.  They are different from, but depend on, traditional Systems of Record (SoR) that log transactions, maintain product information and keep the financial accounting in order.  The key components that comprise SoE are mobile and social on the client side and analytics and cloud on the server side.  Ecosystems are made up of multiple participants with common purposes that blur the boundaries across industries. Additional complexity and opportunity will be driven by the Rising Billions – the 3 billion more people joining the Internet community by 2020.  Ecosystems require businesses to shift from a vertical to horizontal orientation (e.g. Smart Home, Connected Car, Connected Healthcare, Smart Cities, etc.) as new value creation and capture models evolve.  Ecosystem Services focus on the services and inter-operability necessary to “open” the enterprise in a controlled fashion and support/enhance all ecosystem participant engagement and interactions, as well as the monetization of core capabilities and assets.  Adaptive Core simplifies the core environment (typically legacy applications and Systems of Record) and increases adaptability (e.g. cloud and API management) to drive productivity and enable effectiveness at the edge of the business.  With a greater focus on ecosystem services, value creation and capture in the future is likely to involve a continually changing set of services and stakeholders. An Adaptive Core and the core to edge integration will be a critical element in the linkages between ecosystem services, systems of Engagement and Systems of Record, to commercialize innovation and ultimately an organization's ability to quickly adapt and evolve.  Some form of intermediation is required to resolve the tension between the stability and security requirements of the core (Systems of Record) and the creativity, speed, agility and responsiveness requirements of Systems of Engagement at the edge. Systems of Engagement Ecosystem Services Adaptive Core

107. Thinking Differently.

108. People who think differently.

109. …are optimists. Mahatma Gandhi

110. …have an action mentality. Saint Teresa of Calcutta

111. …surround themselves with like-minded people. U.S. Founding Fathers

112. …find company in uncertainty. William Shakespeare

113. …value creativity over intelligence. Steve Jobs

114. …take risks. Nelson Mandela

115. …set expectations high. Albert Einstein

116. …believe in unlimited potential. Abraham Maslow

117. …dream of the future. Martin Luther King Jr.