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Why IT does not matter in
Exponential Organizations*
Srini Koushik
Chief Technology Officer
© 2016 - Magellan Health* Base...
The world is changing rapidly around us
© 2016 - Magellan Health2
Sharing Economy
Capital looking for investments
Rising c...
The velocity and intensity of these shifts is
increasing
© 2016 - Magellan Health
1940 1950 1990 2001 2009 2016
3
Causing structural and seismic shifts in the
global economy
•  Only 55 of Fortune 500 companies from
1955 are on the list ...
The Exponential Organization (ExO)
An Exponential Organization is one whose output (or
impact) is disproportionally (10x) ...
© 2016 - Magellan Health
ExOs are built around a
Massive Transformative Purpose (MTP)
The Massive Transformative Purpose (...
© 2016 - Magellan Health
ExO’s are enabled by key capabilities
DASHBOARDS
Manage ecosystem effectiveness
EXPERIMENTATION
Q...
Ability to create and
own new content
Engage community by
inviting them to Binge
Watch
Netflix Challenge on
Kaggle
Run mul...
9
Focus of ExOs
Customer	
  
Centric	
  
Build	
  the	
  
Ecosystem	
  
Valuable	
  
Experiences	
  
Leveraged	
  
Assets	...
© 2016 - Magellan Health10
How do traditional IT organizations fit
into ExOs?
Relationship
Management
Specification
s
Solutions
Development
Service
Support
Staffing and Supplier Management
IT Financia...
Exponential IT represents a significant
departure from today’s IT
© 2016 - Magellan Health
Consumer
Products
Closed Ecosys...
Exponential IT needs a new set of Plays
Adapted from Lean Startup created by Eric Ries
© 2016 - Magellan Health
BUILD
MEAS...
Smart Creatives – People & System
Excerpts from http://www.slideshare.net/ericschmidt/how-google-works-final-1
APTITUDE:
D...
BUSINESS
(VIABILITY)
PEOPLE
(DESIRABILITY)
TECHNOLOGY
(FEASIBILITY)
© 2016 - Magellan Health
Importance
Frequency
Low High...
TraditiaonlNew
Data Lake
ODS & Sources ETL EDW
Derived (Transformed)
Discovery Sandbox
EDW
Streaming
Unstructured Data
Var...
Lightweight Integration
Stateless Micro Services Secure Cloud
based APIs
Scalable and Extensible
Cohesive Services
Loosely...
Secure Web Scale Computing
Business Architecture
Cloud Native Architecture
Continuous Delivery
DevOpsEngineered Security &...
Platform Thinking
Producer
ecosystem
SaaS
Enterprise
Customers
Service
Providers
MULTI-
SIDED
PLATFORM
Deliver signature e...
20
Active Engagement
© 2016 - Magellan Health
Technology Platform
Collaboration tools
Social Media
User ratings
Multi-moda...
•  Every industry will be transformed by ExOs
•  Smart Creatives and Adaptive Leaders power ExOs
•  ExOs focus on deliveri...
Srini Koushik
Srini Koushik is Chief Technology Officer of Magellan Health. Previously he was President and
CEO of NTT Inn...
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Why IT does not matter in Exponential Organizations

  1. 1. Why IT does not matter in Exponential Organizations* Srini Koushik Chief Technology Officer © 2016 - Magellan Health* Based on Exponential Organizations by Salim Ismail1
  2. 2. The world is changing rapidly around us © 2016 - Magellan Health2 Sharing Economy Capital looking for investments Rising costs of Healthcare Volatility in Asian Economies LAN – WAN - PAN Bluetooth and BLE LTE & 5G Loons, Drones, Satellites Longevity Capital looking for investments Digital Natives & immigrants Eco-friendly and Green Connected Home & Mobility Quantified Self 3-D Printing Natural Language Processing Smart Everything Miniaturization Quantum Computing Moore’s Law
  3. 3. The velocity and intensity of these shifts is increasing © 2016 - Magellan Health 1940 1950 1990 2001 2009 2016 3
  4. 4. Causing structural and seismic shifts in the global economy •  Only 55 of Fortune 500 companies from 1955 are on the list in 2015 •  The average lifespan of an Fortune 500 company is 15 years (down from 67 years) •  At this rate in the next 10 years 200 of the companies in the current Fortune 500 will no longer be on that list © 2016 - Magellan Health4
  5. 5. The Exponential Organization (ExO) An Exponential Organization is one whose output (or impact) is disproportionally (10x) larger than its peer because of the use of innovative organizational techniques that leverage exponential technologies © 2016 - Magellan Health5
  6. 6. © 2016 - Magellan Health ExOs are built around a Massive Transformative Purpose (MTP) The Massive Transformative Purpose (MTP) is the higher, aspirational purpose of the organization, capturing the hearts and minds of those both inside and (especially) outside of the organization. Think Different We organize the world’s information Leading humanity to healthy, vibrant lives 6
  7. 7. © 2016 - Magellan Health ExO’s are enabled by key capabilities DASHBOARDS Manage ecosystem effectiveness EXPERIMENTATION Quick, effective and externally focused AUTONOMY Empower employees and partners SOCIAL Real-time, Bidirectional, Informal Networks and Social Technologies INTERFACES Open and Loosely Coupled STAFF ON DEMAND Hire key skills, rent others based on demand CROWDSOURCING Engage the external ecosystem in core business processes ALGORITHMS Unique, differentiated, insight driven algorithms LEVERAGED ASSETS Leverage assets, use scale to drive costs based on demand and usage ENGAGEMENT Build capabilities by engaging and Integrating across the ecosystem 7
  8. 8. Ability to create and own new content Engage community by inviting them to Binge Watch Netflix Challenge on Kaggle Run multiple experiments and A/B tests to customize experiments Algorithms that track viewing habits and increases viewership Multi-sided platform that makes watching content easy Internal dashboards that help Netflix manage content & infrastructure to deliver optimum performance. Netflix aims to be the World’s entertainment distribution platform Cloud based infrastructure and content delivery © 2016 - Magellan Health Staff on Demand Community & Crowd Algorithms Leveraged Assets Engaging Platform Interfaces ExperimentDashboards Autonomy Social Use of social technologies to engage employees in ideas 8
  9. 9. 9 Focus of ExOs Customer   Centric   Build  the   Ecosystem   Valuable   Experiences   Leveraged   Assets  and   Resources   ExO   Appleized Engaged Context sensitive Cloud & Crowd © 2016 - Magellan Health
  10. 10. © 2016 - Magellan Health10 How do traditional IT organizations fit into ExOs?
  11. 11. Relationship Management Specification s Solutions Development Service Support Staffing and Supplier Management IT Financial Management Security and Risk Management Enterprise Architecture CoreActivities Support Activities ValueAdded Activities IT Portfolio Management IT Support – Facilities etc. 1.  Standardization 2.  Centralized Control 3.  Specialized Skills 4.  Agile Methods 5.  Automation 6.  Efficiency 7.  Outsourcing © 2016 - Magellan Health This model was designed for “Turn of Century” problems Today’s IT Playbook 11
  12. 12. Exponential IT represents a significant departure from today’s IT © 2016 - Magellan Health Consumer Products Closed Ecosystem Standardization Application Centric Platforms Co-creator Open Ecosystem Mass Customization Data Centric Full-stack skillsSpecialized Skills Cloud & Smart SourcingOwn assets & Outsource 1 2 3 4 5 6 7 12
  13. 13. Exponential IT needs a new set of Plays Adapted from Lean Startup created by Eric Ries © 2016 - Magellan Health BUILD MEASURE LEARN 1.  2P HIT & Smart Creatives 2.  A portfolio of Experiences 3.  Lightweight Integration 4.  Agile Insights 5.  Build @ Web Scale 6.  Platform Thinking 7.  Active Ecosystem Engagement 13 Ideas   Pla@orms  Data  
  14. 14. Smart Creatives – People & System Excerpts from http://www.slideshare.net/ericschmidt/how-google-works-final-1 APTITUDE: Desire to perform ATTITUDE: The Ability to Learn ADAPTIVE: Willingness to Change © 2016 - Magellan Health DRIVE: What makes them tick? LEAD: How they Lead LEARN: How they learn TEAM SIZE: 2 Pizza Teams TEAM MAKEUP: Horizontally Integrated AUTONOMY: How they Operate Talent Leaders Team 14
  15. 15. BUSINESS (VIABILITY) PEOPLE (DESIRABILITY) TECHNOLOGY (FEASIBILITY) © 2016 - Magellan Health Importance Frequency Low High LowHigh Experience Design + + 15 Secure – Simple – Context Aware
  16. 16. TraditiaonlNew Data Lake ODS & Sources ETL EDW Derived (Transformed) Discovery Sandbox EDW Streaming Unstructured Data Various Sources Reporting, BI Extracts Data Science Data Discovery Reporting, BI, Extracts Agile Insights – New supply chain of data © 2016 - Magellan Health16
  17. 17. Lightweight Integration Stateless Micro Services Secure Cloud based APIs Scalable and Extensible Cohesive Services Loosely Coupled Data at Rest Data in Motion Data @ Rest Orchestration & Compensation © 2016 - Magellan Health17
  18. 18. Secure Web Scale Computing Business Architecture Cloud Native Architecture Continuous Delivery DevOpsEngineered Security & Defense Cloud Native ITSD&M © 2016 - Magellan Health18
  19. 19. Platform Thinking Producer ecosystem SaaS Enterprise Customers Service Providers MULTI- SIDED PLATFORM Deliver signature experiences Value is derived from the ecosystem - Network Effect Business model delivers value to all participants – Win-Win Open and Interoperable – Easy to connect to Consumed as a Service Value derived from content & network Consumer ecosystem Legacy Systems © 2016 - Magellan Health19
  20. 20. 20 Active Engagement © 2016 - Magellan Health Technology Platform Collaboration tools Social Media User ratings Multi-modal access Easy to access and use Digital Channels Partner Ecosystem Metrics & Learning Customer Ecosystem Social Media IT Consumers as Co-creators Customization of features Decide what to consume Information on usage Transparency on charges Engagement in platform design Producers of Content APIs and interfaces Service Levels and Compensation Branding IP Sharing Revenue and sharing model Growth Plan & Metrics Engagement metrics Stage gate measures A-B Testing Scan competitive models Alternative plans for Pivot 1 23 4
  21. 21. •  Every industry will be transformed by ExOs •  Smart Creatives and Adaptive Leaders power ExOs •  ExOs focus on delivering a secure, seamless, context aware and differentiated experiences •  ExOs view technology and data as a competitive differentiator •  Traditional IT will need to be revamped to support an ExO Conclusion © 2016 - Magellan Health21
  22. 22. Srini Koushik Srini Koushik is Chief Technology Officer of Magellan Health. Previously he was President and CEO of NTT Innovation Institute, a Silicon Valley-based startup focused on building platforms for today’s Digital Businesses . He is also the founder and CEO of Right Brain Systems LLC. Srini has 27 years of experience as Programmer, Architect, CTO, CIO and P&L owner at Fortune 100 Companies including IBM, HP and Nationwide. Srini is an Open Group Distinguished Certified Architecture profession leader. He has published several articles, holds three patents, and co-authored a best-selling book, Patterns for e- business, in 2001. He was elected to the IBM Academy of Technology, and was named an IBM Distinguished Engineer in 1996. He was also named an Elite 8 CIO by Insurance and Technology, a Top 25 CIO by Infoworld, a Top 10 All-Star in the financial services industry by TechDecisions, and a Computerworld Premier 100 Technology Leader in 2014. Srini holds a bachelor’s degree in physics from the University of Madras, a master’s degree in computer science from the University of Bombay, a master’s degree in business administration from Ohio State University, and has completed executive education courses from both the MIT Sloan School of Management and Stanford University. Srini enjoys skydiving, hang gliding and other extreme sports. He is currently working on learning to play the guitar. He enjoys traveling and has been to 55 countries and wants to visit the other 140 countries in his lifetime. © 2016 - Magellan Health22
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An alternative model for IT in Exponential Organizations

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