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The Future Of Information Technology: Welcome… to the Digital Age

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Session: Welcome… to the Digital Age
Presenter: Dr. Rick Huijbregts, Director, Sales Business Development, Cisco Canada

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The Future Of Information Technology: Welcome… to the Digital Age

  1. 1. ©2015 Cisco and/or its affiliates. All rights reserved. Welcome… to the Digital Age Let’s make Amazing Happen Rick Huijbregts yes, on Twitter @DrRickH, LinkedIn, and Facebook
  2. 2. Cisco Confidential 2© 2014 Cisco and/or its affiliates. All rights reserved. The purest form of insanity is to leave everything the same and the same time hope that things will change. Albert Einstein
  3. 3. Cisco Confidential 3© 2014 Cisco and/or its affiliates. All rights reserved.
  4. 4. Cisco Confidential 4© 2014 Cisco and/or its affiliates. All rights reserved.
  5. 5. Cisco Confidential 5© 2014 Cisco and/or its affiliates. All rights reserved.
  6. 6. Cisco Confidential 6© 2014 Cisco and/or its affiliates. All rights reserved.
  7. 7. Cisco Confidential 7© 2014 Cisco and/or its affiliates. All rights reserved.
  8. 8. Cisco Confidential 8© 2014 Cisco and/or its affiliates. All rights reserved.
  9. 9. Cisco Confidential 9© 2014 Cisco and/or its affiliates. All rights reserved.
  10. 10. Cisco Confidential 10© 2014 Cisco and/or its affiliates. All rights reserved.
  11. 11. Cisco Confidential 11© 2014 Cisco and/or its affiliates. All rights reserved.
  12. 12. Cisco Confidential 12© 2014 Cisco and/or its affiliates. All rights reserved.
  13. 13. Cisco Confidential 13© 2014 Cisco and/or its affiliates. All rights reserved.
  14. 14. Cisco Confidential 14© 2014 Cisco and/or its affiliates. All rights reserved.
  15. 15. Cisco Confidential 15© 2014 Cisco and/or its affiliates. All rights reserved. Market Changes… Digital Business is Creating the Digital Economy Bookstore Taxi Music Point-of- Sale Print Advertising Automobile Hotel
  16. 16. Digitization, with the Internet of Everything Accelerate Business Processes, Introduce New Services 21st Century Learning Transforming education and health services Mobile Experience Starbucks Apps Connected Lighting Asset Management Digital disruption will displace 40% of incumbent companies in the next 5 years.
  17. 17. Cisco Confidential 17© 2014 Cisco and/or its affiliates. All rights reserved. Are You READY?
  18. 18. Cisco Confidential 18© 2014 Cisco and/or its affiliates. All rights reserved. “Every company will be a technology company.” - John Chambers “88% of execs know that they have to embrace “digitization”: 35% says they’ll do something about it, but only 7% knows how to go about it.”
  19. 19. Cisco Confidential 19© 2014 Cisco and/or its affiliates. All rights reserved. Why Companies Fail or Succeed
  20. 20. Our world is changing. From analogue to digital, static to mobile. Offline is becoming online. What was here and there is now everywhere.
  21. 21. Innovation Fast Innovation Fast Mobility Cloud Big Data Security
  22. 22. The Platform for Digitization Like Building the Foundation for your Home App Experience (Akamai) Network as a Sensor/ Enforcer Virtualized WAN Services WAN Security, Policy, Orchestration, Partner Ecosystem Cisco UCS Cisco Nexus ACI Integrated Infrastructure Cisco and Partner Intercloud Services Cisco ONE Enterprise Cloud Suite Cisco OpenStack Private Cloud Cisco Connected Analytics Unified Access IoT System Cloud- Managed Mobility Express Cisco Confidential
  23. 23. Cisco Confidential 23© 2014 Cisco and/or its affiliates. All rights reserved. Things Internet of Everything People Process Data More data in one year than In previous 5000 39% of the world is connected billion connected things 13 80% of business processes Technology powers
  24. 24. Cisco Confidential 24© 2014 Cisco and/or its affiliates. All rights reserved. Connect for Better Outcomes Improved Experiences Fuel Innovation Increase Efficiency Create New Markets Unlock Intelligence Minimize Risk
  25. 25. but what is really cool: This is the most connected and intelligent building in the world.
  26. 26. Cisco Canada – Toronto HQ Smart Building RBC Waterpark Place The Facts: • Most Connected building in Americas • One Network for IP lighting, IP HVAC, metering, security, blinds • Central management through Cisco Integration Platform (CIP) What are the features? • 1440 IP POE LED fixtures • 140 new 8-port PoE+ ceiling switches • First Delta Controls IP POE HVAC controllers in the world • EnergyWise enabled
  27. 27. Cisco Confidential 39© 2014 Cisco and/or its affiliates. All rights reserved. Cloud & Services Cloud & Services Responsive Store Municipal Command & Control Center Smart Grid Hospital Optimization Comms Network Optimization Home Energy Mgmnt Traffic Flow Optimization Factory Optimization Logistics Optimization Traffic Cameras Automated Car SystemIntelligent Digital Signage Connected Ambulances Intelligent Medical Devices INTELLIGENT CITY INTELLIGENT HOSPITAL INTELLIGENT HIGHWAY INTELLIGENT FACTORY
  28. 28. Cisco Confidential 40© 2014 Cisco and/or its affiliates. All rights reserved. Smart Water (-) $58M Parking Revenue (+) $50M Smart Lighting (-) $37M
  29. 29. Cisco Confidential 41© 2014 Cisco and/or its affiliates. All rights reserved.
  30. 30. Cisco Confidential 42© 2014 Cisco and/or its affiliates. All rights reserved. Innovation Fast Customers Stakeholders Employees Partners
  31. 31. Cisco Confidential 43© 2014 Cisco and/or its affiliates. All rights reserved. We’re making it Happen!
  32. 32. Thank you
  33. 33. INVESTMENT Workforce of the future Innovation 2005-2014 2015 Partnership Reach New Ecosystem Partners Canadian Gold Partners Average CSAT Score BEST EMPLOYER Canada’s 10 Most Admired Corporate Cultures – 2013 / Aon Hewitt #1 Best Employer in Canada - 2011, 13 -15 / Best Employer in GTA – 2011, 13 -15 / Corporate Knights Top Foreign Corporate Citizen – 2014, 15 / Canada’s Outstanding Employer, The Learning Partnership – 2012 Innovation Program Launch High-Tech/R&D Jobs Announced Toronto Innovation Centre 2013 2015 Investments Network Academies Active Students (10% Female) STEM Education Students since 1997 Research Chairs New Toronto HQ Americas Smartest Building VC Investments to date Registered Partners Gold: 16 Silver: 3 Premier: 87 Select: 185 297 Patents Approved 424 Patents Filed 623 Patents Submitted 37 Patents Approved 44 Patents Filed 53 Patents Submitted

Editor's Notes

  • Speaking Notes:

    UPS: (Data from Leading Digital book)

    Challenge:
    For decades, UPS has been a leader at optimizing its processes. By standardizing its processes, even to the extent of telling drivers how to step off the truck, UPS continually improves efficiency, safety, and quality.
    UPS controls a complex logistical web with millions of possible permutations in service options and delivery routes.
    Route Optimization is a key opportunity and complex challenge, every driver at UPS has trillions of ways to run their delivery routes.
    Solution:
    UPS used advanced algorithms to shave millions of miles from delivery routes.
    The project crunches business rules, map data, customer information, and employee work rules, among other factors, to optimize package delivery routes within six to eight seconds.
    Results:
    Analytics has helped UPS to reduce eighty-five million miles driven per year.
    The reduction equates to over eight million fewer gallons of fuel used.


    Boeing: (Data from Manufacturing EBC deck)

    Challenge
    Avoid misplacing toolkits, machinery, parts and WIP (Work in Progress) inventory which cost as much as $1 million per incident
    Solution
    Cisco’s Unified Wireless LAN Infrastructure Location capabilities and Wi-Fi asset tags
    Results
    Locates tagged assets instantly
    Reduces delays in the production
    Reduces government fines

    “In the factory, the ability to locate major parts and tooling on a timely basis is critical... [Wi-Fi-based Active RFID] will streamline our production environment and make it more efficient time-wise and dollar-wise, by not having to replicate tooling and pieces of gear.”
    Jim Farrecker, Chief Network Engineer, Boeing
    Stanley: (Data from Manufacturing EBC deck)

    Challenge
    Get better transparency of real-time production to schedule
    Dissect why actual labor costs exceeds standard costs
    Need to understand effects of shift changes
    Gain better visibility to real-time OEE
    Solution
    Leverage Cisco Connected Factory Wireless in the plant
    Combine with AeroScout RFID tags
    Integrate RFID Tags to PLC and Quality Control scales
    Results
    24% in OEE improvement in router line
    Reduced labeling error rate by 16%
    Improved labor utilization from 80 to 92%
    Reduced inventory holding costs by 10%

    “With the help of the Cisco and AeroScout Industrial solution, we are on our way toward realizing our vision of a virtual warehouse and fully connected factory, with complete visibility and traceability.”
    Gary Frederick, CIO Industrial Division, Stanley

    Starbucks: (Data from Leading Digital book)

    Challenge
    Following a rapid expansion, Starbucks faced declining same-store sales in 2008, and its share price had been cut nearly in half over the prior two years.
    Senior leaders, under the helm of CEO Howard Schultz, took a number of strategic actions, key among them using digital technologies to engage customers in new ways.
    “Digital for Starbucks was not just about a website or a point-of-sales system, but about an ability to connect with customers and transform their experience and drive the company.” (Adam Brotman, Chief Digital Officer)
    Solution
    The first Starbucks foray into mobile was the company’s myStarbucks app, released in 2009.
    In January 2011, Starbucks took its loyalty program digital with the introduction of its Starbucks Card mobile app.
    Starbucks has continued to expand its mobile payment capabilities. In 2012, it announced that customers would be able to make payments at the register via Square— an app-based mobile payment system— following a $ 25 million investment in the service.
    Results
    Mobile payments at Starbucks have been a success for customer convenience, but they are proving to have financial benefits as well.
    With over three million mobile payment transactions per week in 2012, the mobile-payments introduction has significantly reduced transaction fees.
    “Everything we are doing in digital is about enhancing and strengthening those connections [with our customers] in only the way that digital can and only the way that Starbucks can.” (Brotman, CDFO)

    Philips Connected Lighting:

    For Cisco, Major Partners On-Board: Phillips (vertically integrated), Cree (LEDs), Microchip (controller). Gap: Lighting Management Application (just started discussions with a startup – Enlighted)

    Challenge:
    Imagine . . .a world of beautifully illuminated indoor and outdoor spaces . . . where every light point is connected to an intelligent system that delivers high-quality, reliable illumination . . . and that serves as a pathway for information and services . . . to deliver extraordinary value beyond illumination to the users and managers of spaces. (From Philips Website)
    Solution:
    Connected Lighting– IoT for the carpeted area.
    Results:
    For Manufacturers: Big Market: Lighting market will be € 100B by 2020 (McKinsey). LEDs will be 54% of this market
    For Customers: Save energy Up to 80% savings over conventional lighting (Philips website)

    Digital Disruption quotation – from John Chambers at Cisco Partner Summit 2015.
  • Slide 2: Are we ready

    Are we ready as leaders to lead in this digital age?
    We are at the beginning of the journey where every single thing on the planet will be connected. This is I believe a very significant moment in history, because we are right at the heart of the next development of the internet, and it will be 5-10 times bigger than the first internet and it will be at a scale and performance capability that we cant even realize today.
     
    The last 12 months were like nothing I have seen in my career and the pace of change is accelerating. I could talk to you today about the role of the network and how it will play into this future but I think we already know that. I suggest we need to understand how we will in this room embrace the change. Are we ready as leaders not just to seize upon this opportunity but also to lead it. Are we ready to reinvent ourselves, reinvent our organisations , and reinvent our teams. As leaders we will have some tough decisions ahead.
     
    What do I mean by reinvention? ..... We'll let me ask you who in this room is a technology company? ( wait for hands)
    So that was about 1/3 but I believe in the next couple of years, you will all raise your hands and that is because
  • Slide 3: Every Company Will Become a Technology Company

    Every company will become a technology company –
    The definition of a  “tech” company has been changing for several years. Many companies that apply information technology to serve a customer need have been categorized this way by the business media and the investment community – even if they don’t sell technology. LinkedIn, Twitter, and others are seen this way. If non-tech firms start to apply information technologies directly in what they are selling they are becoming tech companies too. Technology will become a central competency for most companies over the next few years. So I believe that every one of you will be running a technology business, and with that the speed of change is going to be dramatic.
    One customer I spoke too, agreed that his company was becoming a technology company and the vision he had laid out for his team was that they had to find a way to connect every device/ appliance they had ever sold, and vacuum up all the data these devices were collecting from their users so that they could bring it back to the business and analyse it for customer insights so they could build the next generation of appliance.
    WE all need to think about this and of course we need different skill sets as we make these transitions, and of course new roles like head of innovation and chief data officer, and of course the data scientist.
    In a changing environment doing what we have always done will not work.
    So what will determine success or failure in the digital age?
  • Slide 4 What will determine success or Failure in the digital age.

    The first thing is catching the market transitions. Ken Olsen from DEC, who at a conference in 1977 said, "There's no reason for any individual to have a computer in his home." Seems ridiculous now. We are at an inflection point in history…even bigger than the rise of the personal computer. Every company’s future will depend on whether they catch the market transitions and I hope I’m wrong but 40% of my peer companies and the companies in this room will not exist in a meaningful way in 10 years.
    At one time Blockbuster held overwhelming market share in DVD rental and Netflix was the newbie on the block doing a similar business. One company saw changes to the industry coming and embraced the transition to digital online media. The other company did not. That’s what happens during markets in transition. What is happening now will cause huge changes in today's value chains.
    The second thing is not to stay doing the right thing too long…. we are a routing and switching company, or we are a bank, or a retail company? This disruption can disintermediate you overnight…the speed is profound.
    Move into market adjacencies and bring it back to the core of your company. I mentioned Tesco the retail earlier who has done exactly this, but another company is Marlboro the cigarette company who is moving into digital cigarettes. In this space some makers are already thinking about digital cigarettes having wireless and social media features.
    So number two is don’t stay doing the right thing for too long. It causes a company to fail.
    Third you must reinvent yourself – as a business leader, and as a company. Most companies struggle with that, especially if they’ve been successful in the past and they miss new entrance’s or competitors coming into their markets
    There are lots of examples here but lets just take a few.
    Uber is this a replacement taxi service or a new technology model? It's a new technology model, it’s a new application. The Uber application has changed the mode of taxi transportation forever.
    The driverless car, will affect every part of the value chain from manufacturing to insurance to city planning
    And, what about 3 D printing? We are at the board of trade today, but what will trade be in the future when instead of shipping a manufactured good we send an instruction to a printer anywhere in the world and the goods are printed their. No shipping no taxes, no border crossing
    Finally I would call out ensuring that Customers are driving your company direction. Keep your customers at the heart of what you do. There are many examples of where this hasn’t happened and the rise of social media and the consumer’s ability to comment on your product or service real time spells trouble for any company that forgets this.
    So when you put all of this together, I believe that our our ability to make the changes that are required will determine our future
    So lets switch gears and consider what digitization means for Governments.
  • By innovating fast—at a speed and scale unimagined a couple of years ago—you can achieve better business outcomes. 
    It’s all possible through connections.

    (Click) Your customers, your stakeholders, your employees, your partners. Is there anyone who isn’t demanding more from your business? Personalized services. Real-time access to information. Instant communication. All delivered anytime, anywhere, on any device.
     
    And how do they want it? Via apps, that are always on. Always up to date. And always easy to use.

    All the while, you’re dealing with new models for delivery - public, private, or hybrid clouds.

    This adds up to big opportunities and big challenges for your organization.
     
    So you’re investing for growth and efficiency. You’re making business process improvements in your sales, marketing, supply chain, and more.

    (Click) You’re building an IT infrastructure for Mobility, Cloud, and big data that includes network, compute, and security.

    What’s next is building a shared commitment to become a more Innovative Organization. This means business and IT leaders working together. Connected for success.
    It means building the capabilities you need for Fast Innovation. Why? Because innovation is the catalyst for growth and efficiency. It’s the foundation for business success.
  • The platform is predicated on indefinite and meaningful connections.







    There are more people connected than ever. Technology is now powering more business processes. In a single year, we created more data than the past 5000 years combined. And the number of connected devices is growing rapidly every year.
    (Click) It’s called the Internet of Everything. It’s changing how people, processes, data, and things connect to make amazing things possible.
     
    It’s changing everything.
     
    Sources
    In 2012, more data was created then in the previous 5000 years (Telefonica I&D 2011)
    80% of business processes are automated or supported by IT.   Source: Mark McDonald, Gartner Group VP, Gartner Executive Programs, 2010
    13 billion devices – from Cisco VNI forecast
    39% of world population is on-line – International Telecommunications Union – 2013 ITC Facts and Figures
     
  • By improving existing connections, you can unlock more value from your existing technology infrastructure, or free up resources for innovation.
     
    And by creating new connections, you can accelerate new opportunities for growth
     
    (Click) Through the Internet of everything, you’ll create superior and more personalized experiences for your customers.

    (Click) It’s where you’ll deliver new products and services—quickly and intelligently. Who knows what next big thing your business might create.

    (Click) Your organization will also run more efficiently—lean and mean like never before. Reducing costs. Increasing productivity. Getting to market faster.

    (Click) And how about taking advantage of a world that’s increasingly connected? Can you see your business creating or entering entirely new markets?

    (Click) In this era, which is happening now, you’ll also get more from your data. It will tell you things you didn’t know before—things you can put into action to improve your business.

    (Click) And the beauty is you can achieve all of this while protecting your data, keeping your privacy promises, and complying with government regulations.

    By taking advantage of the Internet of Everything, you have boundless opportunities to innovate. To stand out from your competitors. And to make and save money. Just name it.

    This is what the Internet of Everything has to offer, and Cisco and our partners can help you capture your share.

    In 2013, businesses that did the heavy lifting required to create more valuable connections got a (Click) $600 billion dollar payoff.

    The bad news is another (Click) $600 billion went untapped by companies who weren’t fully prepared.

    Source: IoE Value Index research, conducted by Cisco Consulting Services about the IoE Value at Stake.
  • For example, the beautiful city of Barcelona.

    Barcelona embraces its historic past—first founded as a Roman city—while also creating an amazing city of the future. This includes installing streetlights that do much more than provide light. They’re so ‘smart’ they also count people, measure pollution, and monitor open parking spots.

    This is just one way the city is capturing Internet of Everything opportunities.

    In one year, Barcelona saved (Click) $58 million on water usage, (Click) $37 million on lighting, and they’ve increased parking revenue by a third, (Click) totaling $50 million. On top of this they’ve added nearly 50,000 ‘smart city’ jobs while running a financial surplus—a huge opportunity to continue to innovate.

    Note: Additional case studies are in backup—pick/choose which you want to present.
    Note: Cisco worked with the city on several Smart+Connected initiatives, including Smart Lighting, Smart Water (leak detection, distribution mgt., etc.) and Smart Parking.
  • By innovating fast—at a speed and scale unimagined a couple of years ago—you can achieve better business outcomes. 
    It’s all possible through connections.

    (Click) Your customers, your stakeholders, your employees, your partners. Is there anyone who isn’t demanding more from your business? Personalized services. Real-time access to information. Instant communication. All delivered anytime, anywhere, on any device.
     
    And how do they want it? Via apps, that are always on. Always up to date. And always easy to use.

    All the while, you’re dealing with new models for delivery - public, private, or hybrid clouds.

    This adds up to big opportunities and big challenges for your organization.
     
    So you’re investing for growth and efficiency. You’re making business process improvements in your sales, marketing, supply chain, and more.

    (Click) You’re building an IT infrastructure for Mobility, Cloud, and big data that includes network, compute, and security.

    What’s next is building a shared commitment to become a more Innovative Organization. This means business and IT leaders working together. Connected for success.
    It means building the capabilities you need for Fast Innovation. Why? Because innovation is the catalyst for growth and efficiency. It’s the foundation for business success.
  • Slide 9: We’re Making it Happen
     
    And what about Cisco….
     
    We’ve recently made a major move of our Toronto head office in Canada into the first truly smart building in North America. In fact it is the smartest building in North America.
    Building services, from lighting and climate control to security and elevators, are monitored and managed through a single fibre-optic network, and tenants will be able to view their energy consumption and other metrics in real-time. Even the blinds on the windows will be computer controlled.
    The lights are intelligent – powered over Ethernet (the technology that also runs the Internet) rather than through traditional electrical cabling. Each light has its own IP address, and can be individually controlled through a computer or a smartphone app.
    The building also contains motion sensors throughout, so unoccupied rooms won’t waste power with full lighting.
    But these examples are the tip of the iceberg, we are just at the start of the journey and every single customer, head of state, business leader and CIO are looking at how they can take advantage of digitization and the internet of everything.
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