Among the electronics firms currently employing AI and IoT, a group of Reinventors is leveraging these technologies in a particularly transformative and visionary way. Understanding the commonalities between these firms is crucial in this era of fast-paced change for electronics, as industry boundaries blur, and rich ecosystems develop around newly available data sources. A fundamental step towards success in this age of Digital Reinvention is the development of an appropriate hybrid cloud strategy, to support advanced applications of AI and IoT.

1. Ahead of the Curve:
Digital Reinvention in Electronics
with Intelligent IoT
Christophe Begue & Laura Ong
beguec@us.ibm.com
+1-415-545-3052
laura.ong@ibm.com
+1-415-302-8977
©2018 IBM

2. Outline/Agenda
n Introduction
n Who are the Reinventors?
n Reinvention vs. Transformation
n Edge computing and the cloud
©2018 IBM

3. ©2018 IBM©2018 IBM
Intro to the IBM Institute for Business Value
The IBM Institute
for Business Value
runs regular studies
on a range of topics
and industries
By topic: By industry:
• Finance & risk
• Mobile
• Operations &
supply chain
• Security
• Strategy &
innovation
• Talent &
engagement
• Technology
strategy
• AI / Cognitive
• Analytics
• Blockchain
• C-Suite
• Cloud
• Consumer
experience &
marketing
strategy
• Digital
Reinvention
• Aerospace & defense
• Automotive
• Banking & financial markets
• Chemicals and petroleum
• Communications
• Consumer products
• Electronics
• Energy, environment & utilities
• Government
https://www-
935.ibm.com/services/us/gbs
/thoughtleadership/

4. ©2018 IBM©2018 IBM
IBM surveys large number of industry executives on
what drives the transformation of their industry.
We will focus on
trends in IoT and AI
adoption exposed by
the IBM IBV Global
C-Suite Study
These findings draw on input from 3,158 conversations
with C-suite executives from July through September
2017
It is part of the 19th edition in our ongoing series of CxO
studies from the IBM Institute for Business
We have had over 12,000 conversations with CxOs in 2017
See https://www.ibm.com/services/insights/c-suite-study

5. IoT & AI are real, and manufacturers are using them
Source:
IBM Institute
for Business
Value Analysis
©2018 IBM

6. What do we mean by IoT and AI?
n IoT refers to the growing range of connected devices that send and
receive data across the Internet without human interaction and the
software platform to manage them.
n AI in a business context refers to “systems that learn at scale,
reason with purpose, and interact with humans naturally. Rather
than being explicitly programmed, they learn and reason from their
interactions with us and from their experiences with their
environment.” -- John E. Kelly
©2018 IBM

7. Some early adopters are leveraging AI and IoT in a
truly revolutionary way – we call them Reinventors.
IoT + AI
Archetypes
Reinventors
Tacticians
Aspirationals
Observers
We segmented our
respondents by their
current use of IoT
and vision for
Intelligent IoT
Source:
IBM Institute for Business Value Analysis
©2018 IBM

8. What distinguishes the Reinventors?
©2018 XYZ Inc. [Replace or delete]
Reinventors differentiate themselves in seven areas
§ Customer experience focus
– Data and insights to innovate products and services
§ Deploying digital technologies
– Latest technologies to transform interactions and transactions
§ Competitive strategy
– Disrupt by changing the rules of the game
– Data and analytics to inform business strategy
§ Organization agility
– Rapid prototyping to test and refine strategy
– Aligned IT and business strategy
– Short feedback and adaptation cycles
19%
31%
Reinventors
Tacticians
Aspirationals
13%
©2018 IBM

9. The age of Digital Reinvention has begun
©2018 IBM
Using data, organizations can:
• Achieve personalization based on
deep insights about users and
environments
• Proactively anticipate needs and
act on them
• Provide a consistent user
experience across various form
factors
Source: IBM Institute for
Business Value Analysis
The Everyone to Everyone Economy

10. Reinvention goes beyond transformation
Source: IBM Institute for Business Value Analysis
©2018 IBM

11. Reinventors excel at using customer data
while collaborating with competitors
Reinventors
Tacticians
Source:
IBM
Institute for
Business
Value
Analysis
Effectiveness at
creating
compelling
customer
experiences
56%
72%
57%
75%
66%
81%
60%
84%
Collaborate
selectively with
competitors
Have the right
network of
partners,
suppliers &
distributors
Use data to
identify
undefined &
unmet customer
needs
Use data &
insights to
constantly
innovate

12. Reinventors lead in financial performance
& innovation
58%
77%
55%
77%
54%
80%
High revenue
growth
High
profitability
Leading
innovator
Reinventors
Tacticians
Source:
IBM
Institute for
Business
Value
Analysis
Financial
performance and
market perception
(past 2–3 years)

13. The right cloud strategy is a key element of
enabling Digital Reinvention
Source: IBM Institute for Business Value Analysis
©2018 IBM

14. We propose a comprehensive approach to identifying
cloudable use cases.
Source: IBM Institute for Business Value Analysis
©2018 IBM
A few examples:
• Chatbots & virtual assistants
• Technical support & service
• Cognitive procurement
• Cognitive supply chain
• Factory safety
• Electronics design cloud
• Environmental compliance
• Optimized demand forecasting

15. Edge computing is eating the cloud
n The de facto assumption so far has been that
digital transformation goes hand in hand with
migration to the cloud
n With the abundance of perishable data, and faster
and cheaper compute & storage, this assumption
begins to break down – companies must
thoughtfully identify the right cloud strategy, which
will include edge computing
©2018 IBM

16. Why use edge computing?
n Processing data at the network’s edge increases
the actionability of perishable datasets
n Edge computing can decrease latency and
bandwidth demands between IoT sensors and
clouds by performing analytics and sharing
priority information
©2018 IBM

17. Edge computing use cases in manufacturing
©2018 IBM
Predictive
maintenance
Visual
Insights
Events
Streaming

18. An elite group of Reinventors are furthest along in
the journey toward Intelligent IoT
§IoT and AI
planned for the
future
§Little to no
current IoT
implementation
§Limited use
analytics
§ Extensive IoT
sensoring
§ Collaborative
frameworks
§ Predictive
analytics
§ Process automation
with AI
§ AI, machine learning
§ Deep Learning Amplification

19. Thank You!
Christophe Begue
beguec@us.ibm.com
+1-415-545-3052
Laura Ong
laura.ong@ibm.com
+1-415-302-8977
Further reading
Ahead of the Curve
https://www.ibm.com/blogs/insights-on-business/electronics/digital-
reinvention-intelligent-iot/
Intelligent Connections
https://www.ibm.com/services/insights/c-suite-study/iot
Using Data by Design
https://www-935.ibm.com/services/us/gbs/thoughtleadership/drelectronics/
Navigating the Cloud Continuum
https://www-935.ibm.com/services/us/gbs/thoughtleadership/cloudcontinuum/
©2018 IBM