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Dominique Cerutti : Leading the disruptions | Zinnov Confluence '16 Munich

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Keynote delivered by Dominique Cerutti, CEO Altran

While the emergence of AI announces a new wave of breakthrough technologies and innovations which will shake up industries organizations and operations, Dominique Cerutti will explore in his speech the different strategic orientations that industry leaders must envisage to manage innovation in their organizations. How to drive and organize a variety of ER&D activities and focus on value adding areas? Which type of partners and engagement policies shall be set up to leverage on the new opportunities revealed by the disruptions ahead?

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Dominique Cerutti : Leading the disruptions | Zinnov Confluence '16 Munich

  1. 1. 1 Leading the Disruptions How to deploy future-proof innovation strategies Confluence - 2016 Dominique Cerutti Altran, Chairman and CEO
  2. 2. 2 R&D rules the planet The most powerful engine of economic expansion… …Fueled by Top 500 spenders… 0% 10% 20% 30% 40% 50% 60% 70% 80% 0 1000 2000 3000 500 companies concentrate ~61% of the global R&D spend 100 companies concentrate ~40% of the global R&D spend Tail of top 2500 R&D spenders 2014, % of global R&D spend Average company lifespan in S&P 500 33 years 1995 2015 2025 25 years 15 years …Which are ever more challenged -25% -40% R&D growth: 160% of GDP growth over the period $630B (2,0% of GDP) R&D spend OECD, 1982-2014, $B and in % of GDP $920B (2,1% of GDP) $1 150B (2,4% of GDP) 1994 2004 2014 R&D rules the planet
  3. 3. 3 Innovate or abdicate True innovators breaking through to the top… …Creating massive disruptions… $15B R&D investments Focus on autonomous driving and electric mobility …Generating battles of giants Tesla model S market share (US premium market, m/s in volume, 2012-15) Uber market share (North America business taxi market, %, 2014-15) #1 20152012 3% 26% January 2014 March 2015 August 2014 15% 30% 50% Rank 2011 2016 1 2 3 4 5 6 7 8 9 10 New entrants in 2016 top 10 Top 10 market capitalization +23 ppt. $4.5B R&D investments Leading the digital era $12.3B R&D investments Focus on disruptive innovation (e.g. robotics, autonomous car) Innovate or Abdicate
  4. 4. 4 Breakthrough technologies Time to market obsession Digital disruption Differentiation for competitive separation Draconian regulations Global or marginal R&D Shift 1 6 35 2 4 The 6 R&D Tyrannies The 6 R&D Tyrannies
  5. 5. 5 The 6 R&D Tyrannies: the automotive industry Breakthrough technologies Time to market obsession Digital disruption Competitive separation Draconian regulations Global or marginal 1 6 35 2 4 Internet of Things Modularization Car Sharing Autonomous Cars Industry 4.0 Globalization Disruptive players Zero emission Total safety The 6 R&D Tyrannies: the automotive Industry
  6. 6. 6 Core vs. Context: the innovation circle Source: Geoffrey A. Moore, Altran CORE Process creates true differentiation and separation from competition CONTEXT All other processes Mission Critical Process shortfall creates serious and immediate risk Enabling All other processes Differentiation Risk Flowof innovation Deploy differentiation at scale Deploy differentiation at scale Manage Mission-Critical processes at scale Manage Mission-Critical processes at scale Invent differentiated offering Invent differentiated offering Extract resources to repurpose for Core Extract resources to repurpose for Core CORE vs CONTEXT: the innovation cycle
  7. 7. 7 …so what?CORE vs CONTEXT: Key takeaways Focus on COMPETITIVE SEPARATION with a deliberate innovation strategy Declare your CORE Leverage a new SOURCING MODEL 1 2 3
  8. 8. 8 Altran: sharpened business models to address Core & Context challenges From deep domain expertise… 28 000 Altran experts: engineers & scientists Product & Systems Engineering Complex Systems Engineering Intelligent Systems Mechanical Engineering Advanced Test & Simulation Product Design & Innovation Manufacturing & Operations Supply Chain & Logistics Excellence Manufacturing Techno. & Automation Manufacturing Ops & Optimization Civil Works, Infra. & Environment Network Transformation & Performance Digitization Industrial Big Data Analytics Digital Infra. & Governance Digital Applications & Media Product Lifecycle Management Industrial Enterprise Program Management Security, Safety, Regulation & Risk Enterprise Performance & Quality Technology & Engineering Strategy ALTRAN: Sharpened business models to address CORE/CONTEXT challenges
  9. 9. 28 000 Altran experts: engineers & scientists 9 Altran: sharpened business models to address Core & Context challenges … to differentiated business models CORE CONTEXT Critical Enabling Innovative Product Development To access new technologies and explore disruptions World-Class Centers To accelerate, leveraging the best expertise, IP and assets on the most advanced technologies Industrialized GlobalShore® To leverage cost-effective talent pools across the planet ALTRAN: Sharpened business models to address client CORE/CONTEXT challenges
  10. 10. 10 Partner to accelerate on Core: next generation E/E architecture WHO: A leading European car OEM WHY: Ambitious growth plans and exponential complexity of automotive features require urgent rethink of traditional E/E architectures to optimise costs and time to market INNOVATION STRATEGY: Partner and co-innovate to accelerate and create disruptive IP Partner to accelerate the CORE: next generation E/E architecture APPROACH: Move from a complex architecture with 100+ dedicated ECU to a centralized domain 25% integration cost savings and 35% less cabin weight Co-investment to develop a new software platform to manage the complexity of embedded systems
  11. 11. 11 Transform to optimize Context: full variant application development WHO: A leading European car OEM WHY: Significantly optimize the cost of development and time to market of full variant applications INNOVATION STRATEGY: Leverage outsourcing on CONTEXT activities Transform to optimize CONTEXT: full variant car development Co-construction of a nearshore R&D center to develop full variant applications APPROACH: Greenfield set-up of an ODC for activities related to variant applications development with Altran Strong reduction of TCO and unlocking of critical resources
  12. 12. 12 Thank You

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