A presentation that discusses the implications of pervasiveness of IT. What does it mean for business strategies and IT strategies to think of alignment in this new network era?

1. IT
Everywhere
Professor
N.
Venkat
Venkatraman
David
J.
McGrath
Jr.
Professor
of
Management
Boston
University
School
of
Management
venkat@bu.edu
IBM
ASL
@
Boston
University
February
21,
2011

2. Imagine
life
without
informaMon
technology……
(c)
N.
Venkatraman
[2011]
2

3. IT
Everywhere
Illustrative
Cases
and
Concepts
What
does
it
mean
for
IBM
(and
your
clients)?
Discussions
3

4. Role
of
IT
Till
Recently…
Business
IT
Strategy
Strategy
(c)
N.
Venkatraman
[2011]
4

5. Let
Us
Look
Back
at
1995
1,940,000,000
5,000,000,000
(c)
N.
Venkatraman
[2011]
5

6. The
World
Wide
Web
in
1995
(c)
N.
Venkatraman
[2011]
6

7. State-­‐of-­‐the-­‐Internet
2010…
(c)
N.
Venkatraman
[2011]
7

8. 8

9. There’s
the
social
web..
(Facebook)
• 600(+)
million
active
users
• 70%
outside
USA
• 150
Million
access
using
mobile
devices
• 50%
log
on
in
any
given
day
• 700
billion
minutes
per
month
(c)
N.
Venkatraman
[2011]
9

10. And
there’s
the
media
web..
(YouTube)
2
billion
views
per
day
10%
of
Internet
traffic
globally
78%
outside
USA
1
million
video
uploads
EVERY
DAY
$1
million
(daily
bandwidth
cost)
900
seconds
–
daily
average
Mme
spent
per
user
(c)
N.
Venkatraman
[2011]
10

11. And..
there’s
the
real-­‐Mme
web
(Twiber)
(c)
N.
Venkatraman
[2011]
11

12. Tweets
seem
to
be
purpose-­‐driven
Link
(c)
N.
Venkatraman
[2011]
12

13. There
are
other
trends
to
track..
(c)
N.
Venkatraman
[2011]
13

14. From
1995
Mll
today..
• Developments
in
informaMon
technology
have
been
dramaMc
and
significant
• Shids
in
management
pracMces
have
been
incremental
and
slow
• New
business
systems
are
emerging
– Global
– Digital
– Connected
(c)
N.
Venkatraman
[2011]
14

15. 2010
Onwards..
The
Decade
of
Smart
(c)
N.
Venkatraman
[2011]
15

16. IT
Everywhere
in
2015:
Your
Ideas
and
Insights
One
Sure
One
Trend
that
Uncertainty
YOU
see…..
that
YOU
see…..
(c)
N.
Venkatraman
[2011]
16

17. The
future
with
IT…
(c)
N.
Venkatraman
[2011]
17

18. A
Simple
Everyday
Example
(c)
N.
Venkatraman
[2011]
18

19. InformaMon
technology
is
impacMng
design
and
features
of
products..
(c)
N.
Venkatraman
[2011]
19

21. Nike
+
Apple
:
A
‘Sports
Ecosystem’
(c)
N.
Venkatraman
[2011]
21

22. We
conMnue
to
connect
many
different
products
to
the
network
Products
Towards
on
IP-­‐ mulM-­‐
billion
devices
network
(c)
N.
Venkatraman
[2011]
22

23. But
complementary
business
systems
have
not
yet
evolved
in
many
cases..
1999
(c)
N.
Venkatraman
[2011]
23

24. Even
today....
(c)
N.
Venkatraman
[2011]
24

25. InformaMon
technology
and
the
design
of
business
process
systems..
(c)
N.
Venkatraman
[2011]
25

26. FedEx
SenseAware
(c)
N.
Venkatraman
[2011]
26

27. John
Deere
&
Precision
Agriculture
(c)
N.
Venkatraman
[2011]
27

28. Smart
Processes
are
becoming
more
common
in
many
industry
sectors.
Healthcare
LogisMcs
Next-­‐
generaMon
Energy
business
processes
Media
&
entertainment
Financial
Services
(c)
N.
Venkatraman
[2011]
28

29. InformaMon
technology
ushering
next
generaMon
of
services
(c)
N.
Venkatraman
[2011]
29

30. Even
in
ciMes..
(Boston)
(c)
N.
Venkatraman
[2011]
30

31. Facebook
Pages
and
Service
Delivery
(c)
N.
Venkatraman
[2011]
31

32. Services
delivered
through
new
devices
(c)
N.
Venkatraman
[2011]
32

33. …
with
new
ways
of
interacMons
(c)
N.
Venkatraman
[2011]
33

34. Services
delivered
through
network
Next-­‐
generaMon
Service
services
Delivery
(c)
N.
Venkatraman
[2011]
34

35. The
new
digital
business
plamorm
Transact
Innovate
Live
Learn
Play
Work
Connect
Consume
(c)
N.
Venkatraman
[2011]
35

36. Let
us
introduce
three
technology
laws
Bandwidth
Law
Metcalfe’s
Law
Moore’s
Law
(c)
N.
Venkatraman
[2011]
36

37. And
look
at
them
together..
Moore’s
Law
“Computer”
Bandwidth
Metcalfe’s
“ConnecFvity”
“Cloud”
Law
Law
(c)
N.
Venkatraman
[2011]
37

38. Role
of
IT
in
the
Future…
global business
footprint
d
-base ls
cloud mode
new platforms ss
b usine
Business
Strategy
I/T
Strategy
servic iness
e intera data and insights overlap ping bus
ctions ms
strat ecosyste
egy
f
or
‘a
cross pps’
co-creation a scale
ptio n@
entities disru
(c)
N.
Venkatraman
[2011]
38

39. In
IBM’s
parlance…..
Intelligent
Intercon
nect
Instrument
(c)
N.
Venkatraman
[2011]
39

40. Smarter
Systems
Rely
on
Data
&
Insights
Data
Information
Knowledge
Action
Results
(c)
N.
Venkatraman
[2011]
40

41. IT
Everywhere…
Towards
Ubiquity
Business
Consumer
Business
MulMbillion
B2B
B2C
connecMons
with
D2D
rich
data
Consumer
C2B
C2C
(c)
N.
Venkatraman
[2011]
41

42. IT
Everywhere
Illustrative
Cases
and
Concepts
What
does
it
mean
for
IBM
(and
your
clients)?
Discussions
42

43. Serng
1:
Dynamics
of
IT
Sector
Desktop
Mainframe
Mini
Personal
Mobile
Internet
CompuMng
CompuMng
CompuMng
Internet
CompuMng
1960s
2010s
(c)
N.
Venkatraman
[2011]
Source:
Morgan
Stanley
(2009)
43

44. Computer
industry
[circa
1980]
Source:
Bill
Gates
TesMmony
(c)
N.
Venkatraman
[2011]
44
Source: Bill Gates Testimony

45. Computer
Business
System
[circa
2002]
(c)
N.
Venkatraman
[2011]
Source: Bill Gates Testimony 45

46. Two
Key
Ideas…
VerMcal
integraMon
giving
way
to
virtual
integraMon
 When
and
how
do
new
layers
emerge?
 When
do
layers
disappear
or
morph?
1
 Can
you
disrupt
by
introducing
a
new
layer
where
you
hold
an
advantage?
 Can
new
entrants
succeed
by
introducing
new
layers?
(c)
N.
Venkatraman
[2011]
46

47. Two
Key
Ideas…
Winning
requires
dominaMng
a
layer
and
inter-­‐connecMng
across
layers
 What’s
your
pabern
of
interconnecMons
across
the
layers?
2
 How
do
your
compeMtors
interconnect
across
the
layers?
 Do
you
have
network
advantage?
Can
you
defend
it?
(c)
N.
Venkatraman
[2011]
47

48. Wealth
CreaMon
and
DestrucMon
Across
Cycles
of
Business
Systems
in
CompuMng
Desktop
Mainframe
Mini
Personal
Mobile
Internet
CompuMng
CompuMng
CompuMng
Internet
CompuMng
1960s
2010s
Each
cycle
required
the
leaders
to
arMculate
and
architect
different
business
ecosystems
(c)
N.
Venkatraman
[2011]
Adapted
from
Morgan
Stanley
(2009)
48

49. We
are
in
the
early
days
of
mobile
internet
(c)
N.
Venkatraman
[2011]
49

50. We
are
in
the
early
days
of
mobile
internet
(c)
N.
Venkatraman
[2011]
50

51. Emerging
Trends
in
the
I/T
Sector…..
So Lo Mo
(c)
N.
Venkatraman
[2011]
Source: John Doerr, Kleiner Perkins 51

52. IT
Industry
Today….
(c)
N.
Venkatraman
[2011]
52

53. IT
Industry
Today….
Products
SoluMons
Plamorms
Services
(c)
N.
Venkatraman
[2011]
53

54. Serng
2:
AutomoMve
(c)
N.
Venkatraman
[2011]
54

55. Automobile–
“computers
on
wheels”
‘Black Box’
How
many
lines
of
sodware
code?
(c)
N.
Venkatraman
[2011]
55

56. Automobiles–
“computers
on
wheels”
“Cost
of
electronics
in
cars”
(~20-­‐50%)
(c)
N.
Venkatraman
[2011]
56

57. GM
OnStar
(c)
N.
Venkatraman
[2011]
57

58. Real-­‐Mme
InteracMons
for
Safety
and
Convenience
• 2,600
AutomaMc
Crash
Responses
• 10,400
Emergency
Services
• 6,000
Good
Samaritan
Calls
• 600
Stolen
Vehicle
Assistance
• 62,700
Remote
Door
Unlocks
• 54,500
Remote
Vehicle
DiagnosMcs
• 3.4
million
OnStar
DiagnosMcs
E-­‐mails
Sent
• 30,200
Roadside
Assistance
Calls
• 961,000
Turn-­‐by-­‐Turn
Routes
Delivered
• 29
million
OnStar
Hands-­‐Free
Calling
Minutes
Monthly data as of 2008
(c)
N.
Venkatraman
[2011]
Source: OnStar
58

59. Ford
(and
Microsod):
Sync
In-Car WiFi
(2010)
(c)
N.
Venkatraman
[2011]
59

60. My
Ford
Touch
@
CES
2010
(c)
N.
Venkatraman
[2011]
60

61. Ford
Sync
in
2011
(c)
N.
Venkatraman
[2011]
61

62. Mobile
Apps
linked
to
Automobiles
(c)
N.
Venkatraman
[2011]
62

63. Business
systems
forming
around
compeMng
IT
architectures
“Apps”
“Apps”
“Apps”
“Apps”
“Apps”
“Apps”
“Apps”
(c)
N.
Venkatraman
[2011]
63

64. “Apps”
bring
mobile
devices
into
the
automobile
network
(c)
N.
Venkatraman
[2011]
64

65. Emerging
Automobile
Business
System?
Social
Network
Services
(safety,
entertainment,
insurance
etc.)
Data
(analyMcs)
Apps
Sodware
(OperaMng
Systems
Layer)
Hardware
(Chassis
&
Engine)
(c)
N.
Venkatraman
[2011]
65

66. Two
Key
Ideas…
Who
is
architecMng
the
emerging
business
system
in
the
auto
sector?
 GM?
Ford?
Sodware
companies?
 Where
will
value
be
created?
1
 Who
holds
the
architectural
advantage?
 What’s
the
role
of
‘apps’
in
the
auto-­‐
sector?
 How
will
hybrid
and
electric
vehicles
alter
the
business
system?
(c)
N.
Venkatraman
[2011]
66

67. Two
Key
Ideas…
Winning
requires
dominaMng
a
layer
and
inter-­‐connecMng
across
layers
 What’s
GM’s
(or
Ford’s)
pabern
of
interconnecMons
across
the
layers?
2
 Does
GM
or
Ford
or
Toyota
have
network
advantage?
Can
they
defend
it?
 How
will
hybrid
and
electric
vehicles
alter
this
sector?
(c)
N.
Venkatraman
[2011]
67

68. Towards
Intelligent
vehicle
and
Smart
traffic…..
(c)
N.
Venkatraman
[2011]
68

69. Other
IT-­‐influenced
business
systems…
• Healthcare
and
wellness
• Energy
• Publishing
and
media
• Retail
• LogisMcs
and
distribuMon
• Etc.
etc..
(c)
N.
Venkatraman
[2011]
69

70. IT
Everywhere
Illustrative
Cases
and
Concepts
What
does
it
mean
for
IBM
(and
your
clients)?
Discussions
70

71. Role
of
IT
in
Your
Client
Serng
global business
footprint
d
-base ls
cloud mode
new platforms ss
b usine
Business
Strategy
servic
e intera data and insights
IT
ctions
reation a
cross ale stra
Strategy
ng business
overlapp
i
co-c sc ms
entities p tion@ tegy
for
‘ ecosyste
disru apps
’
(c)
N.
Venkatraman
[2011]
71

72. Managing
IT
Everywhere:
Co-­‐creaMon
of
Value
with
Your
Clients
Innovation
Your
IBM
Client
Implementation
(c)
N.
Venkatraman
[2011]
72

73. In
closing……
“The
difficulty
lies
not
so
much
in
developing
new
ideas
as
in
escaping
from
old
ones.”
John
M.
Keynes
(c)
N.
Venkatraman
[2011]
73

74. IT
Everywhere