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Digitize or Die
Sotiris Syrmakezis gave a lecture on digital transformation at the University of Cyprus. He discussed how digital technologies have increased access to information and changed communication. The Internet of Things and technologies like AI, robotics, and smartphones are driving further changes. New business models are disrupting traditional industries, and digital strategies will be necessary for companies to survive. Digital transformation involves the societal effects of digitization across business models, consumption, organizations, and policies.
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More from Center for Entrepreneurship (C4E), University of Cyprus
Digitize or Die
- 1. DIGITAL TRANSFORMATION Sotiris Syrmakezis Lectureat the University of Cyprus, Centre for Entrepreneurship Nicosia, 30 January 2019
- 2. “Right now, aMasai warrior on a mobile phone in the middle of Kenya has better mobile communications than the U.S. president did 25 years ago. If he’s on a smart phone using Google, he has access to more information than the U.S. president did just 15 years ago.” Peter Diamandis, author of “Abundance”
- 3. Internet of Things “Ifyou think that the internet has changed your life, think again. The IoT is about to change it all over again!” Brendan O’Brien, Chief Architect & Co-Founder, Aria Systems Experts Exchange, Processing Power Compared
- 4. Sotiris Syrmakezis Processing Power| Today’s smartphones are what used to be considered supercomputers Experts Exchange, Processing Power Compared 1969 1985 1985 2010
- 5. Sotiris Syrmakezis 2015 2000 ProcessingPower | Today’s supercomputers Experts Exchange, Processing Power Compared 2015 2010
- 6. Sotiris Syrmakezis Storage overtime Experts Exchange, Processing Power Compared
- 7. Sotiris Syrmakezis Moore’s Lawand the 5th paradigm of exponential growth
- 8. TECHNOLOGY “The strongestforce propelling human progress has been the swift advance and wide diffusion of technology.” The Economist
- 9. 1 2 3 VIRTUAL AND AUGMENTED REALITY 4 5 6 7 8 ARTIFICIALINTELLIGENCE ROBOTICS SMARTPHONES ICT CRYPTOCURRENCIES & BLOCKCHAINS INTERNET OF THINGS SENSORS 3D PRINTING BIG DATA & ADVANCED ANALYTICS BIOTECH & NEUROTECH NANOTECH 8 exciting technologies that will change banking (and the world)
- 10. Sotiris Syrmakezis WARNING We tendto overestimate the effect of a technology in the short run an underestimate its effect in the long run
- 11. BLOCKCHAIN By 2022, ablockchain-based business will be worth $10 billion Gertner Prediction, Nov 2016 6
- 12. ARTIFICIAL INTELLIGENCE By 2020, theaverage person will have more conversations with bots than with their spouse Gartner Assumption, Nov. 2016 5
- 13. “HELLO WORLD” byIAMUS COMPUTER CLUSTER & MELOMICS ALGORITHM
- 14. Artificial Intelligence |Artistic Style Transfer Computer Vision Foundation, Image Style Transfer Using Convolutional Neural Networks, 2016
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- 20. Sotiris Syrmakezis AI: chatbotsin action today
- 21. Sotiris Syrmakezis Apple Siri,the early days…
- 22. Sotiris Syrmakezis Apple Siri,mature version…
- 23. Mobile Devices PocketSupercomputers 1
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- 25. Sotiris Syrmakezis Coronation ofPope Benedictus Before the smartphone era…
- 26. Sotiris Syrmakezis Coronation ofPope Franciscus …and after that
- 27. Sotiris Syrmakezis Social mediaused in revolutions Social Media Tahrir Square, Cairo, 2011
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- 30. Sotiris Syrmakezis 82% consult theirphones on purchases they’re about to make in a store “How mobile has redefined the consumer decision journey for shoppers”, July 2016, ThinkWithGoogle.com 1 in 3 have purchased from a company or brand other than the one they intended to because of information provided in the moment they needed it Smartphone users Consumers in the Micro-Moment, Wave 3, Google/Ipsos, U.S., August 2015, n=1291 online smartphone users 18+
- 31. Sotiris Syrmakezis The economicsof Digital Digital competition shrinks value. Customers win, and companies lose. Products/services become obsolete, and value pools consolidate. McKinsey & Co.: Why digital strategies fail, January 2018 DD
- 32. Internet of Things “Ifyou think that the internet has changed your life, think again. The IoT is about to change it all over again!” Brendan O’Brien, Chief Architect & Co-Founder, Aria Systems
- 33. Sotiris Syrmakezis The Internetof Things is on our body
- 34. Sotiris Syrmakezis The humanbody is the next computer interface
- 35. Sotiris Syrmakezis The Internetof Things is in our homes
- 36. Sotiris Syrmakezis Tens ofbillions of connected devices By 2025, some 20 billion devices will be connected, nearly three times the world population Over the past two years, such devices have churned out 90 percent of the data ever produced. Why digital strategies fail, McKinsey & Co., Jan 2018
- 37. Sotiris Syrmakezis More connecteddevices than people Source: Cisco
- 38. Sotiris Syrmakezis IoT: significantcybersecurity issues
- 39. Sotiris Syrmakezis IoT: significantcybersecurity issues 54% of surveyed companies* experienced an industrial control system security incident within the past 12 months * Business Advantage State of Industrial Cybersecurity, 2017 Only 28% of those** consider their IoT security strategy to be “very important” More than 33% think it’s only “somewhat important”, or “not important at all” 61% of those surveyed** have already experienced an IoT security incident Annual fraud rates are now costing over £3 trillion a year*** ** Trustwave Report, 2018 *** Infosecurity Magazine, 2018 64% of surveyed organizations** have deployed IoT devices 20% plan to do so in a year &
- 40. The future of workforce “65%of children entering the 1st grade of primary school will work in jobs that do not exist today” Gartner Strategic Assumption, 2016
- 41. HUMAN vs. SOFTWAREROBOT
- 42. Impact on workforce:job types at risk Source: McKinsey & Co. Grey lines represent average per activity across all sectors
- 44. Impact on workforce:emerging and declining jobs
- 45. It is mucheasier to imagine jobs that will go away than new jobs that will be created. Today millions of people work as app developers, ride-sharing drivers, drone operators, and social media marketers. Jobs that didn’t exist and would have been difficult to even imagine ten years ago. Impact on workforce: new jobs replace the old
- 46. Impact on workforce:wages
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- 48. Sotiris Syrmakezis Millennials technology 0% 10% 20% 30% 40% 50% 60% Playvideo games IM / Chat Download Music/Video Use Social Media Watch TV Online Millennials Gen X Boomers Goldman Sachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016
- 49. Sotiris Syrmakezis Millennials: theyspend more on experiences JP Morgan Chase & Co. | State of the US Consumer | Barclays Global Financial Services Conference, Sep 2016
- 51. Sotiris Syrmakezis Millennials: theyare developing a “healthy lifestyle” Goldman Sachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016 OECD, Economic Outlook and Interim Economic Outlook, Sept. 2016
- 52. Sotiris Syrmakezis GoldmanSachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016 Millennials: the largest generation in history
- 53. Sotiris Syrmakezis Aging population… OECD,Economic Outlook and Interim Economic Outlook, Sept. 2016
- 54. Sotiris Syrmakezis …plus PublicBudget constraints… …means that people will work longer… …and they will be today’s millennials OECD, Economic Outlook and Interim Economic Outlook, Sept. 2016
- 55. Sotiris Syrmakezis 53% don’t thinktheir bank offers anything different than others 1 in 3 are open to switching banks in the next 90 days Millennials and Banking “The Millennial Disruption Index”, Viacom Media Networks, 2013 33% believe they won’t need a bank at all
- 56. DIGITAL TRANSFORMATION “It’s no longerthe big beating the small, but the fast beating the slow.” Eric Pearson, CIO, International Hotel Group (IHG)
- 57. WTF is digital transformation SotirisSyrmakezis
- 58. …is like teenagesex: - Everyone talks about it - Nobody really knows how to do it - Everyone thinks that everyone else is already doing it - So, everyone claims they’re doing it Dan Ariely (paraphrased) Digital Transformation… Sotiris Syrmakezis
- 59. Digital Transformation… If youcan’t explain it simply, you don’t understand it well enough Albert Einstein Όσο πιο καλά τα ξέρεις, τόσο πιο απλά τα λες Πέτρος Αμπαζής
- 60. Digital Transformation… Digitization DigitalizationDigital Transformation the conversion of analog information into digital form the actual process of the technologically-induced change (digitization) within industries the total and overall societal effect of digitalization transform and change: • existing business models, • consumption patterns, • socio-economic structures, • legal and policy measures, • organizational patterns, • cultural barriers Sotiris Syrmakezis Conversion, process and effect accelerate and illuminate the already existing and ongoing horizontal and global processes of change in society
- 61. Sotiris Syrmakezis Largest taxicompany / no vehicles Most popular media owner / no content Most valuable retailer / no inventory Largest accommodation provider / no real estate New business models disintermediate existing ones
- 62. Sotiris Syrmakezis The sharingeconomy (+ the reputation economy) PwC, Sharing Economy: sizing the revenue opportunity x 22.3 x 1.4
- 63. Sotiris Syrmakezis The economicsof Digital Disruption is always dangerous, but digital disruptions are happening faster than ever. Why digital strategies fail, McKinsey & Co., Jan 2018
- 64. Sotiris Sirmakezis The economicsof Digital Digital competition shrinks value. Customers win, and companies lose. Products/services become obsolete, and value pools consolidate. Why digital strategies fail, McKinsey & Co., Jan 2018
- 65. Sotiris Syrmakezis The economicsof Digital Growth rates will plummet. To survive, companies must be first movers. Why digital strategies fail, McKinsey & Co., Jan 2018
- 66. Sotiris Syrmakezis The economicsof Digital Why digital strategies fail, McKinsey & Co., Jan 2018
- 67. Sotiris Syrmakezis The economicsof Digital Why digital strategies fail, McKinsey & Co., Jan 2018
- 68. Sotiris Syrmakezis Digital inflectionpoint is imminent Analytics Services Survey, Harvard Business Review, December 2016 47% believe their traditional business model will be obsolete by 2020 36% of non-digital respondents hold this view
- 69. Sotiris Syrmakezis AnalyticsServices Survey, Harvard Business Review, December 2016 Disruption considered “very likely” for some industries
- 70. Sotiris Syrmakezis Business modelsreplaced, innovation necessary
- 71. Bill Gates, 1994 “Bankingis essential. Banks are not.”
- 72. Sotiris Syrmakezis Tech giantsdisrupt banks…
- 73. By 2021 20% ofall activities an individual engages in will involve at least one of the top-seven digital giants Gartner Strategic Assumption
- 74. Sotiris Syrmakezis FinancialServices Analysis, CapGemini, 2016 A perfect storm enables the emergence of startups
- 75. Sotiris Syrmakezis The “Uberization”of banking
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- 77. Sotiris Syrmakezis FinTech startupsjump out of every corner 13000+ fintechs worldwide
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- 79. Sotiris Syrmakezis ©2016 KPMG Somekh Chaikin 450+ FinTech startups in Israel alone
- 80. Sotiris Syrmakezis FinTech scenein China and SE Asia
- 81. Sotiris Syrmakezis Fintechs cooperateto create larger challenges
- 82. Sotiris Syrmakezis “Thestate of the financial services industry 2017”, Oliver Wyman, 2017 COMBINED VALUATION OF TOP GLOBAL FIRMS IN EACH CATEGORY Digital disruptors grow much faster than incumbents
- 83. “In the future,BBVA will be a software company” Francisco Gonzalez, BBVA CEO, Mar 2015
- 84. Sotiris Syrmakezis Empowered customershave given rise to a new era Age of manufacturing Mass manufacturing makes industrial powerhouses successful Age of distribution Global connections and transportation systems make distribution key Age of information Connected PCs and supply chains mean those that control information flow dominate Age of the customer Empowered buyers demand a new level of customer obsession A concept of Forrester Research
- 85. Sotiris Syrmakezis We mustbecome digital businesses Digital businesses continuously exploit digital technologies to create new sources of value for customers and increase operational agility in service of customers
- 86. Sotiris Syrmakezis Adopt digitalstrategy to business strategy Digital strategy Business strategy Governance Execution
- 87. Sotiris Syrmakezis Digital TransformationComponents Vison & Mission Operational excellence strategy Business case Capability map Digital strategy Business strategy Governance Execution Customer experience strategy
- 88. Sotiris Syrmakezis Digital Strategy| Vision Vision & Mission Operational excellence strategy Business case Capability map Digital strategy Business strategy Governance Execution Customer experience strategy
- 89. Sotiris Syrmakezis Digital Strategy| Our mission
- 90. Sotiris Syrmakezis Digital Strategy| Our mission
- 91. Sotiris Syrmakezis Digital Strategy| Customer Experience & Operational Excellence Vision Operational excellence strategy Business case Capability map Digital strategy Business strategy Governance Execution Customer experience strategy
- 92. Digital Dinosaur Digital Connector DigitalOperator Digital Master DigitalCustomerExperience Digital Operational Excellence ExternalFocus:Customer Internal Focus: Enterprise Data & Insights Digitally enhanced products & services Digital Strategy | Customer experience & Operational excellence Apply digital technology to address customers in a more sophisticated way to increase revenues and profitability Decrease cost of the existing value chain’s primary functions (e.g. R&D) as well as support functions (e.g. HR) business as usual partial digitization new business models disrupt (sub-) markets Develop new business models generating profits based on digital technology
- 93. Sotiris Syrmakezis Inside-Out vs.Outside-In Inside-Out Web/mobile enablement Outside-In Customer enablement Existing Systems (product-centric) New Platform (customer-centric) A Backbase concept
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- 95. Sotiris Syrmakezis PEOPLE THINK ABOUTHOW THEY CAN BENEFIT COMPANIES THINK ABOUT HOW THEY CAN PROFIT
- 96. Sotiris Syrmakezis PEOPLE THINK PERSONALVALUE COMPANIES THINK ECONOMIC VALUE
- 97. Sotiris Syrmakezis PEOPLE THINK ABOUTHOW THEY’RE TREATED COMPANIES THINK ABOUT THE PRODUCTS THEY OFFER
- 98. COMPANIES ARE FORCINGPEOPLE TO BE SOMEONE THEY’RE NOT – and people don’t like it –
- 99. COMPANIES JUST HAVETO BETTER UNDERSTAND WHAT PEOPLE THINK not your ordinary customer segmentation methodology
- 100. Sotiris Syrmakezis …by designingproducts & services as digital-first experiences… …leverage digital data sources and analytics to optimize customer experience in real- time… …by extending the value we bring to customers inside their ecosystem of digitally connected products and services. …so that our customers rely on us, they trust our systems to recommend their next action or they allow us to take the action for them. …to deliver a best-in-class digital customer experience… …because the disciplines of customer experience influence everything we do. Digital Strategy | Digital Customer Experience Digitize end-to-end customer experience Digitize products & services as part of the value ecosystem Convert data to information Digital front-end processes Multi-channel service Digital Marketing and Social Media Integrated physical & digital experience
- 101. Embracing mobile asthe platform, lets the opportunities of interaction grow exponentially Customer Experience Strategy | Mobile-1st
- 102. When we thinkabout digital experiences, the comparative set is not a competitor’s app. It’s the last app our user opened
- 103. Serve customers intheir mobile momentsCustomer Experience Strategy | Mobile moments
- 104. Sotiris Syrmakezis Leverage digitaltechnology to engage customers and partners in innovation and product design Prioritize investments that create agility in our operations to cope with rapid changes in market conditions Use agile and iterative techniques to bring digital products and services to customers Measure and reward employees based on customer-centric metrics over functional metrics Optimize operations using digital connections to dynamically source services in support of customer value Empower employees with digital tools. Aid them build their own collaboration networks, internally and with partners Digital Strategy | Digital Operating Excellence Source enhanced operational capabilities Drive rapid customer-centric innovation Emphasize agility Automation of back-end processes End-to-end digitization Outsourcing of support functions Automated analytics and intelligence
- 105. Sotiris Syrmakezis Digital Strategy| Capability map Vision Operational excellence strategy Business case Capability map Digital strategy Business strategy Governance Execution Customer experience strategy
- 106. Sotiris Syrmakezis As-is andto-be capabilities required to support the business Digital Strategy | Capability map | Example
- 107. Sotiris Syrmakezis Digital Strategy| Business case Vision Operational excellence strategy Business case Capability map Digital strategy Business strategy Governance Execution Customer experience strategy
- 108. Sotiris Syrmakezis Business case= set of proof points to support the investments Digital Strategy | Business case | Example
- 109. Governance Digital strategy Business strategy Governance Execution Cooperationbetween department and silos Thinking beyond a ‘campaign mentality’ in digital strategy Clarity of roles and responsibilities Company culture 81% 78% 72% 67% Obstructive for…
- 110. Sotiris Syrmakezis Execution Culture Organization Metrics Technology Digital strategy Businessstrategy Governance Execution
- 111. Sotiris Syrmakezis Digital Strategy| Execution | the components Culture Organization Metrics Technology Foster a culture of digital innovation Alignment to support digital strategy, governance, execution Use customer & business data to measure success Use and adopt emerging technologies • Education & training plan • Innovation strategy • Communication: roadshows, int. conferences, 3rd-party support • 3rd-party input: Universities, consultants etc. • Salary & people cost • Reorganization & restructuring: current & future-state • Recruitment / new skills • Customer journey mapping / BPM • Salary & people cost • Agency & outsourcer cost • Customer-centric KPIs • Data architecture to define services and APIs • Analytics: web, social, location, footfall etc. • New measurements: NPS, CxPI etc. • New payment/reward schemes to reflect x-touchpoint targets • Architecture vs. journey maps: highlight critical tech transform. • Touchpoint development • Technology purchasing & licensing / cloud • Data model & integration / APIs • Outsourcing
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- 117. Sotiris Syrmakezis The DigitalInnovation Pipeline Effectively shifting gears between the different phases of the innovation pipeline (for digital innovation) boardofinnovation.com
- 118. Sotiris Syrmakezis At theend of the day your customers don’t care whether you’re agile, lean or practice design thinking. They care about great products and services that solve meaningful problems for them in effective ways. The more you can focus your teams on these things the better their process will be. Lean or Design Thinking or Agile? Work in short cycles Hold regular retrospectives Put the customer at the center of everything Go and see
- 119. Sotiris Syrmakezis Metrics inthe digital world Accenture, 2015
- 120. Sotiris Syrmakezis BostonConsulting Group, The power of people in digital banking transformation, November 2015 Phases in Digital Transformation Journey
- 121. Sotiris Syrmakezis The ever-presentorganizational structure question Forrester Research, Evolve Your Organization Structure To Promote Digital Maturity Model Decentralized Centralized Federated Strategy Governance Execution Description Embedded in business units Embedded in business units Embedded in business units Centralized Centralized Centralized Centralized Combined Embedded in business units All strategy decisions made in distributed, local teams independent of one another HQ makes all strategy & tactical decisions, giving local teams little to no leeway to adjust execution HQ makes most strategy decisions & allows local teams to adjust decisions and execute within specs
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- 123. Sotiris Sirmakezis Originality isnon-existent. Authenticity is invaluable. Jim Jarmusch, Film Maker To innovate, steal like an artist
- 124. Sotiris Sirmakezis You can’tjust ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new. Steve Jobs CEO, Apple Inc. To innovate, believe in yourself
- 125. Sotiris Sirmakezis It’s notwhere you take things from, it’s where you take them to Jean-Luc Goddard, Film Maker To innovate, start where others have stopped
- 126. Sotiris Sirmakezis Grumpies aregood at: • Finding Mistakes • Shutting Down • Saving Money Search for them, you need them! Stepping on others’ toes
- 127. Sotiris Sirmakezis Ideas travelfrom one side of the table to the other. Most interesting games are between opponents coming from totally different training, technique and methodology environments. It’s like ping pong
- 128. Sotiris Sirmakezis Show respectto others & Fight like crazy for your ideas! Fight like a gentleman
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- 130. Sotiris Sirmakezis A manis not into innovation because he is paid to do so, but because he wants to* *Gene Meieran, Intel Fellow Money isn’t everything
- 131. Sotiris Sirmakezis Focus on unmetcustomer needs Experiment with new business models Think like an ecosystem player Face the non-believers Choose speed over perfection Be ruthless about your liabilities Innovate the adjacent possible Maximize the use of existing technology Place a few selective big bets Start thinking like a disruptor
- 132. Digital business transformationis a journey, not a destination
- 133. MISSION : e-POSSIBLE! MISSION : IMPOSSIBLE ? Thank you! DIGITAL TRANSFORMATION