Data Con LA 2020 Description The talk will describe how a $2B traditional, asset and human-capital intensive company which owns and operates a million machines was turned into a modern, digital-data driven company any deploying IoT and advanced analytics. The talk will describe how every aspect of customer/consumer experience and company operations (convenience based use, pricing, optimized service, collections and refunds) was transformed using new data driven tools, visualizations and insights. Speaker Sugath Warnakulasuriya, Thalamus Labs, Managing Director

1. T H A L A M U S L A B S
How to turn traditional Industrial
Companies into Modern, Digital-
Data Driven Companies
Sugath Warnakulasuriya
October 24, 2020

2. Key Steps to Creating Digital Data-Driven Companies
Identify and Quantify All New Sources
of Data Driven Value
1
2 Pilot and Validate Technology and Operations
4 Scale Value Capture Across Your Company &
Customers
3 Introduce New Tools & Practices to Modernize
How You Work

3. Identify and Quantify All New
Sources of Value:
• Rigorously model all revenue
and costs savings levers
• Consider new/peripheral
markets and business models
Step 1:

4. Even the simplest IoT implementations introduce a number of
value creation opportunities
• Costs:
- Just-in-time service
- Better scheduling, routing
- Improved worker productivity
• Revenue:
- Equipment uptime
- Service quality
- Asset performance

5. Options for value creation grow dramatically as additional
stakeholders interact with IoT devices
• Revenue:
- Digital payment (convenience)
- Dynamic Pricing
- Stock outs elimination
• Costs:
- Service Optimization
- Inventory Management

6. Opportunities to create value can grow exponentially as
you introduce multiple smart/IoT devices incl. packaging
Smart Packaged
“Consumables”
Vending Environmental Manufacturing Fleet Mgmt., etc.
Myriad of Consumer and Industrial use cases:
• Revenue, New Biz Models
- Customized experiences
- Engagement, loyalty
- “as-a-Service”
• Cost savings
- Replenishment, VMI
- Authentication, fraud
- Perishability, safety, hygiene

7. Client performance
mgmt. via
Dashboards
Reduced loss
Reduced collection
costs
Streamlined and
Customized Service
Pricing, Yield
Management
Consumer Apps to reserve,
pay, get service/refunds
Identify parts of the business that could benefit from data …
New sales wins
Consumer payment,
engagement
Machine Uptime
Service Dispatch
Data Monetization

8. Estimate value: amounts available varies greatly based on your
specific context, thus requiring careful and rigorous analysis
MRO/Service Optimization Asset Management
Improved Customer
Experience
Improved Sales
Win Rates
New Revenue Models
New Data Products
and Services
Customer Support
Improved Pricing
+ 5 - 50%
+ 5 - 25%
+ 5 - 35%
- 5 - 30%
+ 5 - 35%
+ 2 - 15%
- 3 - 15%
- 5 - 20%
What are
your
sources of
value?

9. Build detailed models to quantify

10. Once value identified, assess “size of the prize”, and
cost/complexity to implement of each in order to prioritize
Convenience
Based Revenue
$$$
Improved
Sales Win
Rates
$$
New Data
Services
$$
Customer
Support
$
Dynamic
Pricing
$$
Cost
ComplexityLow High
Service
Optimization
$$$
Illustrative
Asset
Utilization
$
top priority
2nd tier
LowHigh

11. Pilot and Validate Technology and
Operations:
• Evaluate alternative approaches,
technologies & vendors
• Test & operationally validate your ability to
capture value
Step 2:

12. Critical Areas of Investigation in Operational Validation:
• Does the technology work?
• Can you get the data?
• Can you operationalize the data?Most important

13. Pilot: Narrow Focus and Iterative Experimentation!
Region
Market
Segment
Value
Lever
Product
Subset

14. May22
May21
May17
May18
May19
May20
Apr16
May16
Apr17
Apr18
Apr19
Apr20
Apr21
Apr22
Apr23
Apr24
Apr25
Apr26
Apr27
Apr28
Apr29
Apr30
May1
May2
May3
May4
May5
May6
May7
May8
May9
May10
May11
May12
May13
May14
May15
TimeofDay
… this will give you new insights, help you find surprising
new sources of value
Example: Unforeseen usage
patterns >> pricing possibilities
Example: Usage patterns
>> Segment-based
marketing

15. Other External Data
Location
Resident Personas
Demographics
Property Structure
Example: Predictive Machine
Learning model that answers
“Where and what equipment to
install, and what outcomes to
expect
Properly designed pilots let you build longer term value

16. Step 3:
Introduce New Tools & Practices to Modernize
How You Work:
• Develop easy-to-use visual, data-driven operational
tools
• Make it simple for your team to make real-time
decisions

17. As you scale the use of data, begin building longer term
capabilities, tools, and behaviors
Experiment
Build Tools
Operationalize
Develop
Insights
Build
Tools
Perform
Analysis

18. 7
%
10
%
17
%
Week
*31
% *26
%
*26
%
*16
%
*28
% *24
%
*23
% *15
%
Early iterations of using data to make decisions

19. Setting the Vision for Real-Time Management
1
Manage
Sales
Pipeline
2
Manage
Conversion
Pipeline
5
Monitor/ and
Correct Install
Errors
3
Install/
Upgrade
Machines
4
Track Property
Performance
6
Drive Adoption via
Digital and Field
Marketing
7
Collect
Cash/Coin
as Needed
8
Digitally
Audit
Collections
9
Perform
Service as
Needed
10
Optimize Pricing
and Revenue
11
Support Sales
Team
12
Issue Digital
Refunds
Comprehensive Digital Dashboards
and Tools for Real-Time Operations
and Performance Management of
Branch

20. Daily Installation Scorecard Daily Payment Health Check Adoption and Growth Mgmt AS/400 GRPM/Revenue Summary
DI Dashboard DI Revenue Validation Coin-Box Full (CBF) Dashboard LP Variance Detail Report
Branch Installation Scorecard Clarify Site Audit Tool Field Marketing Validation ToolMachine Error Dashboard
Dashboards and Analytics Tools for of Real-Time Management

21. Creating “Moments of Impact”

22. Interactive
Visual
Dashboards

23. Individuals&TeamsOrganizations
Behaviors&MindsetTools&TechniquesFrameworks&Mechanisms
Ideate
Jobs-To-Be-Done
Value Prop. Canvas
Business Model CanvasCustomer Development
Validate Design-Build Fund Scale
Exponential OrganizationsBlue Ocean 10 Types of Innovation
Lean Startup/Agile
Design Sprints
Modern Toolbox for Corporate Innovation - v1
Disruptive Innovation
Broad perspective
• Divergent thinking
• Reframing
• Improvising
• Seeking ideas from other
industries, contexts
• Connecting dots
Strategize Design Build-Operate Extend Sustain
Innovation Accounting
Customer focused
• Curious
• Listening
• Probing
• Empathetic
• Always asking “why?”
• Seeking hidden pain,
insights
Experimental
• Challenging assumptions
• Hypothesis driven
• Continuous testing,
validation
• Emphasis on measurable
results
• Iterative and flexible
• Learning as the goal
Mindset Aligned on Growth
• Purpose driven
• Intrinsically motivated
• Embracing continuous
change
• Does not fear failure
• Open to external ideas and
people
• Outcome focused!
Fast, Flexible Teams
• Flat structure
• Multi-functional
• Collaborative
• Action biased
• Results focused
• Politically sensitive,
thoughtful and savvy
Dynamic Organizations
• Clear, visible, & vocal
leadership support
• Storytelling as a means
of rallying
• Transparent
• Sharing learning
• Celebrating success
Starter Kits Ideation Platforms
& Contests
Dedicated Time to
Innovate
Three Horizons
Open Innovation
EcosystemsStaged Funding
Venture FundsInnovation Centers,
Labs & Accelerators
Management &
Governance
Staged Funding
Crossing the Chasm
Investment Readiness
Ambidextrous Growth
Pitching Essentials
Contact Sugath Warnakulasuriya: sugathw@ThalamusLabs.com

24. Step 4:
Scale Value Capture Across Your Company &
Customers:
• Ensure consistency and quality as you fully
operationalize
• Continue to gather and incorporate learnings along
the way

25. • > 500K unit installed base, ~3K service
team
• 12 value levers identified and quantified,
8 levers validated and operationalized
• Internal digital team created, and new
operating model, data-driven processes
and tools introduced
• On track to generating +25% new
EBITDA
Summary of Case: IoT and Analytics-led Transformation

26. Recap:
• Model every part of the business
• Build business case, and pick the right pockets of value
• Pilot to prove you can capture the value
• Build out tools, capabilities and infrastructure as you
scale
• Along the way, build the organizational muscle, and
culture

27. Thank you!
Pls send your questions, comments to:
sugathw@thalamuslabs.com
T H A L A M U S L A B S