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With Digital Transformation, Banks Can Be the New Disruptors

As a connected consumer, I can buy a book, plan a vacation, or choose a movie from any number of devices and from any location (home, office, car, or airport!). These interactions are not only convenient, they are more and more highly personalized and tailored to my likes and dislikes. We have all experienced this on Amazon and other commerce sites.

Unfortunately, we don’t get this experience from many banks.

In a Cisco survey of more than 7000 smartphone users and bank customers in 12 countries, 43 percent said that their primary bank did not understand their individual needs. Bank customers in China (54 percent), Brazil (52 percent), Mexico (49 percent), and India (46 percent) felt even more disconnected (see chart below).

Source: Cisco Consulting Services, 2015

Source: Cisco Consulting Services, 2015

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The Digital Vortex: Relentless, Disruptive, Chaotic — and Empowering

I have good news and bad news. First, the bad news: across industries, digital disruption is threatening to overturn incumbents and reshape markets faster than perhaps any force in history. Now the good news: companies can take control of their own destiny by embracing digital transformation and the Internet of Everything (IoE).

Let’s take a closer look. By “digital disruption,” I’m referring to the effect of digital technologies and business models on a company’s current value proposition — and its resulting market position. Digital disruptors innovate rapidly, and then use their innovations as a powerful competitive advantage to gain market share and scale far faster than challengers still clinging to traditional business models that can’t keep up with the pace of change. Read More »

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IoT Meets Standards, Driving Interoperability and Adoption

For years, industrial control systems have been characterized by proprietary devices, protocols, communications, and applications. However, at the Hannover Fair last spring, virtually every exhibitor showed products that support IP, Ethernet, or Wi-Fi interfaces—something that would have been unthinkable just a decade ago.

The Internet of Everything (IoE) is driving this change, with an exponentially growing number of connections among people, process, data, and things. The Internet of Things (IoT) is a key enabler of this evolution. By 2020, according to Cisco’s analysis, there will be 50 billion connected devices—all needing a common way to work together.

As I discussed in my last blog, the worlds of Information technology (IT) and operational technology (OT) are converging—and they are converging around standards. The good news is that the industry is recognizing that a fragmented, proprietary model does not scale, and inhibits the value of IoT deployments. The IoT standardization efforts are focused on four different areas: Read More »

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In the Digital Vortex, Disruption Blurs the Lines Between Industries

Recently, I spent a week in Asia with clients, partners, and our various teams. One of the most common themes I heard from clients is that the pace of disruption in today’s markets can be overwhelming. Yet, despite the speed and pace of change resulting from todays’ technology forces, most leaders recognized that the disruption also presents opportunity — and that cutting-edge innovation can provide the path to success amidst all the change.

Lately we’ve been looking at a new concept of how ideas constantly collide, combine, and reform, and how the disruption rate varies by industry. It’s an interesting topic and has yielded some fascinating insights. One of the areas we’ve unveiled involves what we call the “Digital Vortex” — and you can read more about it in this post by my partner Martin McPhee.

Out of that swirling, chaotic “Digital Vortex” comes game-changing innovations that upend existing business models and blur industry lines. It’s exciting, yes, but more than a bit unsettling, especially for industry incumbents.

However, I believe that even market incumbents can gain an edge by understanding the nature of the Digital Vortex in which they compete — along with the “combinatorial disruption” that redefines industries by combining and recombining value drivers such as cost, experience, and platform. Read More »

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IT Is from Venus, OT Is from Mars

Bringing Alien Worlds Together in the Internet of Things

In the 1990s, I, like millions of others, read the book Women Are from Venus, Men Are from Mars. This best-seller suggested that the frequent misunderstandings between genders make it seem as though men and women are from different, alien worlds. But it’s not just men and women who appear to be from different planets. Today, every organization that has begun an Internet of Things (IoT) deployment is bumping up against a fundamental disconnect between information technology (IT) and operational technology (OT). In many cases, these two groups are alien to one another—with separate technology stacks, network architectures, protocols, standards, governance models, and organizations.

In the first wave of the Internet, data and technology systems fell solidly in the realm of IT. IT systems focused on the flow of data across an organization, and with a few exceptions, did not get involved in production and logistics environments.

However, in many companies, a parallel organization—commonly called operational technology —has grown up to monitor and control devices and processes that act in real time on physical operational systems, such as assembly lines, electricity distribution networks, oil production facilities, and a host of others. Read More »

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