Digital technologies are reshaping businesses and how consumers interact with them. IT leaders must help their organizations adapt to these changes by embracing digital platforms and taking an ecosystem approach. This involves thinking about transforming products, processes and business models with digital, and aligning business and technology strategies. Adopting platform-based IT using integrated cloud stacks can provide the agility, scalability and innovation that digital businesses require.

1. Welcome to the world of Digital!
With highly interactive online communities taking the world by storm at large, technology has made great
strides in reshaping the world’s future.
This whitepaper shares Sonata’s Point of View (POV) on how technology leaders within enterprises or
vendors adapt and lead business change being caused by the Digital revolution.

2. So then – let us take on the topic of the day!
The topic of Digital business seems to polarise business and service providers alike! So, which of these
two statements do you subscribe to?

3. There is no doubting that digital technologies are reshaping the world. Many of the trends are already
gathering momentum.
As an example - study of US consumer behavior by Nielsen showed the pervasive reach of technology into
every stage of a shopping cycle. From researching to buying and reviewing, the shopping cycle had
become one seamless journey with mobile devices and connectivity.
This has not only seen online retail grow at over 10 times the industry average, but has led to a next phase
of evolution where customers expect technology to facilitate seamless Omni-Channel shopping across
online and store channels, as well as across different stages if the shopping cycle. This phenomenon is
spreading from industry to industry.

4. If this were not enough – most of us know that even as we are absorbing the impact of consumerization
of IT, the next wave of change is already upon us!
Consumers are moving on to a hyper connected mode – with communities such as Facebook and
Whatsapp reaching a billion plus active monthly users and over 42 BILLION messages a DAY!
At the same time – technology is changing exponentially too! With a projected quadrupling of IoT
connected devices and the data deluge of a Quintillion plus bytes of data per day being processes with
tools such as AI – the future is clearly anything but predictable.
As an aside - AI enabled a computer to beat possibly the greatest chess player of all times Kasparov –
TWENTY years ago! Ofcourse – one can see that this capability is now available mainstream for businesses
to use. Interestingly – even as recently as 2015 – a computer could only come a close fourth in a poker
game of global standards. Incomplete information and ‘bluffing’ can still possibly save us from a taking
over of the world by machines!

5. The point that the image above is making is that - the new platform enabled business models are anchored
in three fundamental changes that technology has enabled. Community, connectivity and intelligence are
driving P2P market places, on-demand services and the sheer ability to scale – across category, country,
channel – what have you!

6. Even as technology reshapes the world, IT professionals have a bigger role to play in leading from the
front in helping their business win the change.
On one hand, consumers are still not satisfied with how effectively businesses make it easy for them to
interact with them across digital and traditional business channels.
On the other hand, business leadership is constrained in innovating effectively to deal with the
opportunity. The rapid change in consumer behavior, driven in a large part by technology itself and the
rapid pace of technology change, has made it difficult for businesses to take the right bets on innovation.
And the ever present issue of budgets for new investments in a difficult uncertain environment has further
hamstrung business.
In this context, IT leadership can play a key role in resolving the technology driven challenges and help
business move forward with a clearer digital agenda.

7. Little wonder then that IDC predictions strike so close to home!
Business KPIs for CIOs! A high 80%+ IT spends are going to Digital. There is a need to set up systems that
work across a spectrum of innovating for business with technology, integrating these innovations to
existing systems and in incorporating the new systems to scale to impact the entire business. All this while
still rationalizing costs and scope of legacy systems.

8. While I am sure many of you here have led thru equally tough change agendas in the course of your career,
we thought we would today put forth some thoughts on how we could get some method to the madness
in tackling what is clearly an exponentially tougher task!
We believe working together with your team and IT partners on the following front can help chart a
reliable path forward.
1. Think Product, Process and Business Models
2. Align Business and Technology – essentially Digital
3. Embrace Plarformation
4. Take an Ecosystem Approach

9. At Sonata we see Digital that needs to be thought through in terms of three important dimensions on how
it can impact business.
Products or Services becoming Digital – or being so significantly enhanced with Digital technology that the
traditional product or service will clearly become redundant.
New Digital business models – or how the value chain can be redefined to significantly enhance or change
the market with Digital technologies.
Innovating on new processes and services within existing businesses with Digital to gain customer value,
differentiation and competitive advantage.
And of course – underlying this is the need for the right Digital plumbing – or Digital infrastructure - that
can help you build the new systems that will run your business. This is a challenge in itself – which many
of Sonata’s customers are already working with our Tech Infrastructure team to set a roadmap, ahead of
their new digital program rollouts.

10. To add some touch-feel to this –
Each business has to think how digital can be applied to transform their product, business models and
processes.
Product ideas would involve things like music going the iTunes way, Google emerging as the next biggest
threat, not only to Ford or Toyota, with their self driving cars – but possibly to Uber too! OR think of
Amazon Echo – the voice activated in home speaker assistant which could influence which pizza or brand
of detergent you order! Can you imagine how your products could change? Possibly some of them are
already out there!
Business model ideas – some obvious ones out there – foreign or Indian! Here – the things to focus on
would be – how can technology help me join the dots differently? How can we create and select a more
strategic position in a redefined value chain? This is pretty much the current focus of disruption and also
the most difficult one for an incumbent to work on. We will touch upon this again at the end.
Processes – these have a part of even traditional IT programs – but take on a new dimension with new
technology. There could be a few process innovations which could pretty much scale into new models!
Instant Loans, Retail Self Checkouts, personalized globally accessible cloud based medical records – just
some examples to illustrate.
As technology leaders, we could proactively help business, marketing and design teams work thru a more
comprehensive range of ideas for transformation on all 3 fronts.

11. Research shows that getting digital right is about getting the intent & intensity of a technology led
transformation agenda AS WELL as the methods and processes of planning and implementing them right.
At Sonata we advocate a well thought through and balanced approach to planning a digital business
transformation program.
Digital Strategy – as mentioned earlier – helps in understanding the impact of digital innovation and
technologies to develop digital strategies to add business value through digital products, business models
and business processes. It helps to ideate widely and then shortlist priority programs with clear business
impact evaluation criteria.
Digital Journey - Develop digital transformation vision, objectives, and roadmap to achieve set goals for
key programs that are shortlisted.
Digital Implementation - Formulate Design, Architecture, Implementation plan and execute the
technology program as per the set plan.
The alignment of business and digital programs has to be steered through this stage with a wise approach
without shortcuts. The next image illustrates why.

12. A clear illustration of the need to align business and Digital strategy is a MIT Sloan study that indexes
business performance to Digital business transformation initiatives. The study measured a basket of
financial performance indicators for over 100+ large companies globally with their Digital efforts. Digital
efforts were measured on two dimensions – Digital Intensity – the extent of Digital technology based
project executed and Digital Governance – the extent to which the entire process was strategically
managed. The companies scoring well on both fronts are identified as Digirati on this chart, while the
Beginners are just starting on this journey on both fronts. Fashionistas are driven by initiatives but with
less governance, whereas Conservatives are taking a slower but more measured approach to Digital.
As the metrics show – the Digirati obviously have strong value which leaders like you can hardly ignore!
What is also important to note is also that while 38% of CEOs in the study had Digital on their agenda –
only 15% of Digirati had got both the intensity and governance right. The fashionistas who mistook action
for purpose – actually ended up losing out financially – and possibly putting their companies at greater
risk of aversion to future technology initiatives too!

13. While the earlier stages focused on getting the context right, we believe HOW Digital IT needs to be done,
is very different too.
The ‘born digital’ players have been disrupting business not only with their platform business models –
but with their underlying platform approach to IT too. The technology environment, application build
approach and the IT operations model work to a very different rhythm.
Integrated stacks to common standards on the cloud in a high secure environment, with auto scaling is
the norm for infra. Applications are designed as micro services, with an ecosystem of partners providing
a collection of component applications which can be easily integrated and orchestrated within this
standard environment. Operations approaches include continuous development, integration and
deployment for fast flexible feature releases as well as in-built operations analytics that help measure,
control and optimize system performance.
All this adds up to scalability of systems, innovation agility, speed to market and performance cost benefits
that beat traditional IT approaches, when it comes to meeting the needs of the digital business era.
To offer a quick example the attached quote shows the speed and scale of Facebook’s technology agenda
– this is a quote from 2011. Amazon speaks of rolling out a code change every second in their business!
People liken these new systems to being able to replace every part of an aeroplane – while it is in flight!!!

14. Recognizing these new technology and business paradigms – leading technology vendors are already
going platform with their enterprise offerings. An example here from Microsoft. While their Azure PaaS
offers a great standardized environment for infra and applications development, their technology suites
are being harmonized and integrated to work seamlessly in this environment. Case in point is the recent
move to integrate Dynamics AX and CRM to Dynamics 365 and enable Cortana and PowerApps to offer
analytics and mobile capabilities on the platform. To top this all up – Microsoft has also set up AppSource
– a store for enterprise applications where an ecosystem of partners and customer can interact to source,
plug and play business solutions as per their need on this stack.
What all this shows is that it is both necessary and possible to bring together infra, app devops and
business transformation in one comprehensive step. This enables the speed and agility of innovation, as
well as the scale expected of new age IT systems from business - Innovate, Integrate, Incorporate -
Instantly!

15. To put a touch of reality to this with our own experiences.
Sonata has launched on Appsource an Omni-Channel digital retail platform called Brick & Click. It brings
together pre-integrated e-Commerce, Mobillity, analytics and ERP for retail on the Microsoft stack with
capability for Hybris cloud deployment. A range of business functionalities such as unified commerce,
single view of customer, inventory and operations, personal and contextual experiences online and
instore, and flexible fulfilment have been enabled.
The power of this solution is that as a platform and its component parts, it has been used to deliver a
range of business relevant systems innovations quickly and effectively. From mobile POS for a US fashion
retailer to multi country B2B commerce for an Australian women’s fitness fashion brand to end- to-end
e-Commerce systems for a Indian consumer electronics retailer – the ability to leverage a modular prebuilt
solution on a popular technology platform is immense.

16. We have also seen this flexibility span very different segments of an industry and would extend it to say
that large enterprises can plan platforms that can streamline and rationalize IT systems across SBUs!
Our experience here with Rezopia, our travel management platform shows how the core multi-channel
reservations, distribution and travel operations management functionalities could be leveraged to solve
for a wide range of systems needs. From a next gen cloud based online packaging and booking platform
for a leading US member based travel company to a modern multi-channel enabled reservation and
ancillary package sales system for a large Australian rail operator – we could quickly and efficiently meet
system needs across diverse segments.

17. Once the decision to adopt platform based IT has been made, business also can choose between different
ways of executing the program. Specific business process on leading ISV stacks that a business is already
invested into can be deployed if time, cost and risks need to be moderated. A more end-to- end business
Platformation may need a decision to migrate to industry specific cloud platforms that are being set up
by early movers in this space. A very unique set of business features and the willingness to invest time
and money in setting up a differentiated platform may mandate an approach where a significant part of
the platform is custom built.

18. Coming onto the final dimension in driving change – increasingly it is absolutely necessary to think
ecosystem.
As new technology reduces the distance of separation between and even the roles played by various
stakeholders, businesses need to look at how they continue to be a critical catalyst in the value chain.
While born digital startups have clearly found it easier to do this as they come with a clean slate –
incumbent leaders have a tougher challenge in moving from ‘pipe’ models where they manage the entire
value chain to a ‘platform’ model where they catalyze the exchange of value.
However – clearly – there is a need for this change – and definitely in creating relevant new ecosystems
in at least some part of the value chain. Some examples - GE has moved to set up Predix an IoT and
analytics driven industrial machine management platform for both GE and non GE assets. Clearly the first
mover advantage of learning, standards and scale that the system will gain, will give it a high probability
of becoming a valuable default choice for industry. Another example is of SupplyOn – a supply chain
collaboration platform. Clearly – any of the major logistics incumbents could see this as a relevant model
to pursue at least in select industries!
In sum – stepping back to see the larger ecosystem and bring it back together more innovatively with
technology is a new way of thinking that is needed. Equally importantly – IT cannot be seen as something
that is done within the four walls of a company. The ability to use platforms and an ecosystem of
technology vendors, partners and developers who can collaborate on it to build industry relevant
solutions, is the fresh way to look at IT.

19. To quickly recap the drivers of effectively leading digital business transformation:
Think Big! – Across Product, Process, Business Models
Think Strategic! – To Align Business and Technology
Think Change! - Embrace Platformation
Think Networks! – Take an Ecosystem approach

20. Many of Sonata Software’s esteemed customers have known the Company to be one the pioneers of the
IT industry in India for more than 30 years. While change is the only constant, Sonata today has achieved,
to a reasonable extent, its objective of being a 360 Digital solutions company with a footprint across
product engineering, enterprise IT and technology infrastructure.
Sonata has, over the last three years rolled out a new strategy of growth anchored in industry specific IP
led digital solutions and would like to report, that this has seen the Company emerge as one of the fastest
growing IT companies with a 3 Yr CAGR of 16% on revenue and 56% on profit. Sonata’s digital solutions
portfolio has expanded significantly over about 31% of our revenues.
The Company has actively acquired and built industry specific platforms– examples being, the Rezopia
Travel platform, Brick & Click Digital platform and recently Halosys Unified Enterprise Mobility platform &
IBIS Inc’s Advanced Supply Chain Solutions in the US.
The customers’ patronage of Sonata’s solutions has also seen Sonata win significant awards and
recognition, such as, the Microsoft Country Partner of the Year (twice in three years), the Azure Cloud
Partner award, the SAP Pinnacle award and the Zinnov Leadership Zone for product engineering services.
Sonata’s solutions has also won the Travel Weekly Award and the Hybris Most Innovative Partner award.