Last week I was in Orlando attending NCR’s Synergy Conference, which, this year focused on “Inspired Commerce.” At the show I heard a lot of dialog with retailers and technology partners about how the Internet of Things and the integrated use of mobility in our day-to-day lives is changing how retailers engage with consumers. I addressed this topic in my session at the show, but wanted to mention a few highlights in hindsight.
First, the use of mobile devices during the shopping journey is no longer for millenials and early adopters only. They are certainly the heaviest users, but across the board in the US, 55% of shoppers are making use of retailer-specific applications, and 34% are using independent shopping apps such as Groupon, Zulily, etc. More than 40% of consumers want to receive their loyalty points/perks and discounts in real time, while shopping in the store, vs. receiving the same information in snail mail or in email.
Second, mobile is becoming integral to the shopping process. Retailers are facing demands for greater convenience, transparency, and interactivity with their consumer base that would have been unimaginable even a decade ago. (As a side note, this is extending into other industries as well, such as healthcare and financial services.) Consumer expectations are evolving, and with this, retailers need to be able to offer new and effective engagement opportunities with their brand.
Other disruptors include fast-changing technologies such as social media use (not just Facebook and Twitter, but now Pinterest and Instagram) and the need to aggregate social sentiment data; unstructured data such as photos, posts, Tweets; and structured data coming from legacy systems such as CRM, SCM, and POS to make real-time decisions at the edge of the network – in the store or online where the rubber meets the road.
So – high volumes of structured and unstructured data, exponentially growing sophisticated consumer demands, and the growing use of mobile devices in the shopping journey. How does the retailer leverage all of these opportunities to make the most of this evolution?
With billions of connections, sensors and devices lighting up the Internet of Things, the aggregation of structured and unstructured data to deliver real-time analytics on mobile devices for store associates and mobile engagement via apps aimed at consumers, the opportunities are endless. Retailers that can deliver hyper-relevance – which, according to Cisco’s research, is increasingly what consumers prefer during the shopping process – will be the ones who stand out. Hyper-relevance delivers to me, the consumer, what I want, when and how I want it, in the context where I am at that particular moment.
To succeed in this new paradigm, retailers must earn consumers’ trust and deliver consistently as a brand to get access to the data that lets them provide a truly relevant real-time experience. Once consumers are willing to share a certain amount of personal data – at Cisco, we call this the “trust cliff” – retailers can use real-time analytics to turn that data into actionable insights.
We have identified three key attributes that retailers must possess to deliver hyper-relevance and build a dynamic infrastructure and processes:
Hyper-aware: By implementing and automating edge technologies such as sensors, cameras, beacons, and RFID tags, retailers can capture value from the intelligence and automation that is now available to them. This is the way to begin to gain true visibility into what the customer is experiencing in the store, how they are dwelling in the store, where they need help with the shopping process.
Predictive: By overlaying intelligence and analytics on top of these edge technologies, retailers can gain real-time anticipatory insight into what is happening, what to expect, and how to meet customers’ real-time needs. If retailers can more systematically determine peak timeframes and loyal customers’ shopping patterns, they can anticipate the staffing needs to speed up the shopping process and assist customers through the checkout process faster.
Agile: Agile, solid infrastructures, adaptive business processes, and associate training capabilities are critical to being able to deliver the kinds of dynamic experiences discussed here. When business processes can change dynamically and associates trained to respond and do what’s best for the customer, all while leveraging technology and insights gained from integrated systems, the customers’ shopping experience can delivered in an excellent manner.
This is obviously not as easy as it sounds. Implementing a hyper-aware, predictive, and agile network to respond to your customer demands is very difficult. We in the Cisco Business Transformation Team work with customers to help them explore where they are today and where they want to take their business in the future, and work arm-in-arm with them to look at what it would take to get from where they are today to this desired future state.
We recommend the following steps:
Forget everything you thought you knew about the digital consumer – all the old paradigms are melting away and “segmentation” no longer applies
Go to the edge for visibility into what customers are experiencing at that moment
Build a dynamic infrastructure and create agile processes that to support the customer experience
Develop new business models that drive innovation and enable hyper-relevance
If you would like to download the white paper from Cisco Consulting Services that I’ve referenced, please click here.
Many of you know about the Cisco Secure Ops Solution that was announced in 2014, and that it has already been adopted by Shell to secure the company’s critical infrastructure, but may not have seen a demonstration or talked with a Cisco subject matter expert about it.
Cisco Live, San Diego, CA, USA
Well, here’s your chance. We have arranged for a booth in the industrial vertical area at the World of Solutions at Cisco Live in San Diego to show just that. We’re pleased to be accompanied by one of Cisco’s security partners to show new features and functionality that takes Secure Ops even deeper into the cybersecurity protection and surveillance arenas.
The Cybersecurity space is getting more and more alarming every day. As my colleague Peter Granger notes, we have gone from the quaint world of Sherlock Holmes…
Sherlock Holmes: I didn’t really ask, Dr. Franklyn, but what exactly do you do here?
Dr. Franklyn: Oh, Mr. Holmes, I’d love to tell you. But then of course, I’d have to kill you.
Sherlock Holmes: That would be tremendously ambitious of you.
…past the pseudo-high-tech world of James bond and closer to a more modern world reminiscent of Kiefer Sutherland’s character Jack Bauer in the TV series ’24’. Today’s Cyber attacks are not just disgruntled employees or simple mischief makers (although that’s bad enough), but can be carried out by powerful crime syndicates and hostile governments.
Now more and more attacks are becoming visible and reported (e.g. Stuxnet like ‘Havex’ malware strikes European SCADA Systems – June 2014) and whether they are a terrorist attack such as the data destruction attacks on Saudi Aramco and on Qatar’s RasGas gas company in 2012 or unintentional (the vast majority of reported cyber incidents are ‘accidental in nature’ as reported by the Repository of Industrial security incidents, 2011), billions of dollars are lost every year because of them. Night Dragon, Shamoon, Flame, and Duqu have joined Stuxnet in the past few years and more will come.
A study by Fox-IT reported that 60 percent of oil and gas companies do not have a cybersecurity incident response plan. In addition, only 11 percent are fully confident that they can address a cybersecurity breach appropriately. Twenty-three percent admitted that they are not actively monitoring their network for potential intrusions.
And, of course, you can also visit us Cisco Live: there you’ll see how the Cisco Secure Ops Solution is relevant to many industries and is helping tackle our customers’ security challenges. A combination of technology, software and services expertise, Secure Ops Solution can help you increase your security response levels significantly – before, during and after an attack, across the entire attack continuum.
Guest Blog by Marcel Cappetti, Managing Director, Oil and Gas, Global Enterprise Theater
I’ve just returned from CERAWeek in Houston—an international event that could be described as “Davos for the energy industry.” It’s a gathering of the power elite, including industry, finance, technology, and government leaders from around the globe. For me, it was the perfect sensing post for all the angst and opportunity that pervades the industry today.
It was my privilege to participate in a panel on “Leveraging Operational Excellence to Drive Margin Expansion”—a key concern of oil and gas (O&G) executives following the crash in oil prices. Too often in previous downturns, companies have relied heavily on deep cost cuts—including massive layoffs and cancelled projects—to keep margins afloat. But this time seems different. There is general agreement in the industry that we will not be returning to $100-a-barrel oil prices any time soon. So it’s time for more than a course correction. It’s time for digital transformation. Digital transformation will drive operational excellence and, yes, margin expansion.
During my talk last week, I shared highlights from a new Cisco study discussing the new reality in O&G and the opportunity for digital transformation through the Internet of Everything (IoE)—the networked connection of people, process, data, and things. Key findings include:
“Operational efficiency of existing projects” and “maintenance of assets and infrastructure” will be the top two areas of increased investment over the next 24 months.
O&G leaders clearly understand data’s potential—they named “data analytics for faster, better decision-making” as the No. 1 driver for IoE investment.
Business transformation—including breaking down organizational silos and converging IT and OT people, processes, and technologies—is essential for digital transformation. According to Cisco’s study, 59 percent of respondents do not believe their IT and OT organizations are aligned.
Companies that transform will have a significant bottom-line impact. Analysis by Cisco Consulting Services shows that by implementing a range of IoE-empowered solutions, oil and gas companies can capture their share of $600 billion of Value at Stake between 2016 and 2025. For a $50 billion firm, this translates into an 11 percent bottom-line (EBIT) improvement.
Cisco can help O&G companies in their journey to digital transformation through the investments we have made in key technologies—such as analytics, data, sensors, wireless, and mesh—and through solutions developed with key partners. For example:
Remote Operations—Developed with GE, our Connected Oilfield solutions increase personnel safety and improve asset integrity with predictive maintenance; real-time analytics at the edge and virtual expert support enable faster and better decisions.
Pipeline Automation—In partnership with Schneider Electric, Cisco’s Connected Pipeline solution uses analytics at the edge to improve security and environmental protection with predictive detection of pipeline intrusion, leakage, and deformation.
Wireless Operations—Developed in partnership with Honeywell and Emerson, this Connected Processing Plant solution improves personnel safety and process efficiency with wireless real-time tracking, video analytics, and automated incident response.
Secure Operations—Industrial cybersecurity solutions improve security and risk management to combat new and evolving cyber security threats, specifically in the process control domain. A good example is a project for Royal Dutch Shell that provides remote proactive monitoring and SLA-driven management of security, applications, and infrastructure. We are working with industrial control system delivery partners such as Yokogawa Electric and Rockwell Automation to support this solution, which Shell plans to deploy at all upstream, downstream, and lubricant sites.
When the price of oil stood at more than $100 per barrel, the need for oil and gas companies to improve operational efficiencies was primarily driven by the competitive marketplace—and many firms took no action at all. Read More »
The key to retail today is customer understanding —where each customer stands on his or her personal shopping journey, whether in-store or out. Retailers must “know” each shopper as never before. And they must offer the kinds of contextual, personally relevant experiences that will optimize their merchandise mix, create faster inventory turns, and drive greater customer engagement.
After all, the typical customer today is mobile, connected, and has heightened expectations. Many are accustomed to a deeper level of real-time interaction from innovative online retailers than from traditional brick-and-mortar stores.
Yet, as a recent Cisco study revealed, offline retailers – or retailers that combine on and offline capabilities – have their own unique advantages – if they step up to the opportunities of the Internet of Everything (IoE) economy. By blending the benefits of the physical store — such as the ability to touch, compare, and try on products — with the benefits of the virtual world, retailers can create a new value proposition that can’t be matched by their online-only competitors. In the process, they not only drive their own industry’s disruption but challenge for market leadership.
In the first six months of 2013, 53 percent of cybersecurity incidents were in the energy sector, according to the Department of Homeland Security. As cyber-attacks are becoming increasingly prevalent in industries that support our critical infrastructure, it’s crucial that business leaders adopt security process designed to address these new threats. Are you ready?
While I was at CERAWeek last month, former US Secretary of Energy, Daniel B. Poneman, and Under Secretary, NPPD, US Department of Homeland Security, Suzanne Spaulding had a message to attendees. Their message was clear:
Cyber Security is a “C-Suite” topic of Enterprise Risk Management.
Their recommendations are strong: Security needs to be baked it in from the beginning! Physical and Cyber Security and Secure Coding of Software!
• Implement Layered Protection; we cannot depend on just a perimeter defense
• Apply Cyber Security Framework: 1. Assess, 2. Protect, 3. Detect, 4. Respond, 5. Recover
• Attend to the nexus of Physical and Cyber Security
• Test your response, including business recovery and continuity
Digital strategy and business strategy are becoming one and the same. Forward-looking energy firms see opportunity in today’s turbulent market and seek to pull ahead by changing their operating models through the Internet of Everything (IoE). Transformative digital technologies have to potential to deliver many advantages to O&G firms, including increased business agility and risk awareness, lower cost of operations, and reduced downtime. But before the industry can embrace these new strategies, an effective, end-to-end cybersecurity approach—including alignment between IT and OT—is needed.
Security a Catalyst for Transformation
Digital transformation means that a range of new and diverse devices are connecting to industrial oil and gas networks, generating greater amounts of data. When managed effectively, this data delivers the right information to the right place, at the right time, helping create a competitive advantage. However, as the IoE proliferates, the accompanying explosion of devices and applications will lend itself to increased areas of attack that criminals will seek exploit.
Oil and gas companies must replace traditional approaches like physical segmentation and security by obscurity. They need an integrated approach where information flows in real time to enable immediate action. Cybersecurity doesn’t need to be an inhibitor. It should be the catalyst for new ways of working. It can help oil and gas companies work more safely and better protect the environment by obtaining remote visibility and control over operations, including processes in refineries. It can make processes more efficient, increase production and reduce overall costs.
Addressing the Entire Threat Continuum
Cyber-attacks occur on a continuum of before, during, and after. The same digital hyper-connectivity that oil and gas managers use to collect data and control machines and processes, can also allow cyber attackers to get into system networks and steal or alter classified information, disrupt processes and cause damage to equipment. Threats to a company’s information systems and assets could come from anywhere. State and non-state actors from around the globe are constantly working to penetrate the networks of energy providers and other critical infrastructures in the U.S.
Energy firms must address this entire continuum with a visibility-driven, threat -focused, and platform-based framework:
Visibility-driven means having an accurate, real-time view of the network fabric, endpoints, mobile devices, applications, virtual environments, the cloud, and their interrelationships. High visibility allows you to make sense of billions of devices, applications, and their associated information, while helping you see an attack coming, control the environment, and mitigate threats.
Threat-focused means focusing on detecting, understanding, and stopping threats. Policies and controls reduce the surface area of attack, but threats still get through. Focusing on threats can help you identify threats and indicators of compromise based on a well-honed understanding of normal and abnormal behavior. This requires continuous analysis and real-time cybersecurity intelligence across all technologies. With contextual awareness, you can identify false-positives and assess the impact of a threat.
Platform-based means we have an integrated system of agile and open platforms that cover the network, devices and the cloud. It is a true platform of scalable, easy-to-deploy services and applications. You gain powerful end-to-end visibility with centralized management for unified policy and consistent controls
Securely Converge IT and OT
As oil and gas companies embrace the IoE, they bring together the use of information technology (IT) and operational technology (OT). Security needs to be as pervasive and applied in a unified way across the extended network. Physical and cybersecurity solutions must work intelligently together to reduce unauthorized system access – in order to protect networks, devices, applications, users and data. For example, in many oil and gas companies today, upstream and downstream domains use different solutions for common tasks such as asset performance management. In addition, OT is often managed autonomously from IT, even for critical functions such as reliability and cybersecurity.
Cisco has the broadest set of solutions covering the broadest set of attack vectors, leveraging both global and local intelligence. Cisco’s Secure Ops Solution is helping oil and gas companies secure industrial control networks by combining on-premises technology, processes, and managed services. For example, Royal Dutch Shell (Shell) was challenged with increasing its security maturity level. By implementing the Secure Ops Solution, Shell was able to improve its cyber security and risk management, lowering costs of delivery while significantly reducing its costs of securing the process control systems that keep billions of pounds of toxic material under control. Cisco Secure Ops Solution provides remote proactive monitoring and Service-Level-Agreement (SLA) driven management of security, applications and infrastructure, making it easier to:
• Manage cyber-security risk.
• Support compliance.
• Secure the perimeter between enterprise and operational networks.
• Implement and maintain layered security controls
How can Cisco help your energy organization? Read More »