Digital Transformation Needs Great Technology

IBA Group
Mark Hillary

Digital Transformation today can mean a lot more than just changing the way your brand delivers a service online. In many cases, companies many need to entirely redefine their business model to keep up with a changing industry that is being shaken by new market arrivals and constant innovation.

In some cases this means old brands die and new ones takeover the market. Instagram is a good example. The entire business of taking and sharing photographs is completely different today and the entire infrastructure that involved cameras, films, and development facilities has almost entirely disappeared in the last 5-10 years. However, in some cases a digital transformation can mean a completely new way of working inside a business that, on the surface, appears to be doing what they have always done.

This Forbes case study of Lufthansa Technik Logistik Services (LTLS) is a good example. LTLS provides logistics, transport, and warehousing services inside the airline industry. LTLS is itself owned by Lufthansa Technik, which provides maintenance, repair, and overhaul services for airline engines. On the surface these businesses sound like traditional engineering and logistics companies that exist to help keep airlines flying safely.

This remains true and nothing has changed in that regard since LTLS started a major digital transformation project a year ago, but there are some areas of process that have changed dramatically, especially around warehousing. Around half their revenue comes from their warehousing service so any way that innovative digital technologies can help to improve these processes will directly impact on the success of the business.

LTLS has implemented nine different projects all focused on assessing digital technologies. These include: using optical character recognition in combination with AI software to automatically fill in input screens and eliminate paper in the receiving department by scanning 10,000 documents each day; smart, light weight, gloves with 2D scanners that allow for hands free picking; integrating their warehouse management system to smart watches; and the use of mobile logistics robots to reduce worker travel.

One of the critical aspects the LTLS highlight about their own digital transformation is the cultural adoption of new processes. They tested the robot technologies in warehouses by buying a single robot and testing it alongside the existing processes, building cultural support for a complete rollout and replacement of the old practices.

This is where your approach to culture can be critical. Not every digital transformation springs from nowhere and transforms the industry overnight. This can happen, as we have seen, but most plans resemble the LTLS approach. There is a clear need to improve the way the business functions and digital technologies can help to transform the business processes – there is a clear sense of where we are now and a future state for the business.

In all these transformations you will require the team to support the changes being proposed, or the implementation is likely to fail. LTLS were smart by slowly introducing changes that could work alongside existing processes and the workers could quickly see how their life would be improved if robots did most of the heavy work inside the warehouse. It’s an agile approach that not only allows for support to develop, it allows for process errors for be fixed during the implementation and avoids the potential disaster of switching from one system to a new one and finding that it is full of errors.

Clearly this approach is worth some extra consideration by any executive team currently studying the opportunities for digital transformation in their business.

IT Trends For 2018 Will Be More Consumer Focused Than Ever Before

IBA Group
Mark Hillary

The industry analyst firm Gartner has just published their view on technology trends to watch in 2018 and it makes for some interesting reading. Their research summarises the trends into three main groups: intelligent, digital, and mesh.

Scanning across all the trends it is interesting to see how many are now very influential on customer experience (CX). Companies used to engage with their customers mostly through customer service functions – often just contact centres accepting calls and emails. Now there is a much more complex environment where customers expect intelligent interactions across many different immersive environments – technology is required to support all of this.

Consider these trends, all from the top 10 Gartner predict as important for 2018:

  • Conversational Platforms; Google Home, Amazon Alexa, Apple Siri. People are getting much more comfortable just speaking to computers and expecting them to respond intelligently. Google has even demonstrated their Pixel Bud headphones that can translate 40 different languages in real-time, allowing a user to have a conversation with a person speaking another language.
  • Immersive Experiences; both Augmented Reality and Virtual Reality are really taking off as people get used to immersion into a new world. The success of the Pokémon GO game in 2016 boosted AR and VR is seeing a huge boost as the power of the new Sony Playstation and Microsoft Xbox mean that millions of people have VR systems at home.
  • AI Foundation; companies are finding that they can use AI to help with real problems. In particular a common machine learning and AI solution now is to capture every customer interaction – what problem the customer has and how it was solved – creating a smart system that over time learns how to answer almost any problem. The system knows about every question every customer has ever asked, and how the problem was resolved in the past.
  • Intelligent Things; the Internet of Things (IoT) means that many more devices will be connected and online. Often this is talked about as a way to ensure your fridge never runs low on milk, but the real story is that your devices will all be talking to their manufacturer all the time, diagnosing problems and fixing themselves or upgrading – without your involvement at all. Imagine if your car can just check itself and get advice from the manufacturer automatically?
  • Blockchain; Crypto-currencies are still a niche pursuit, but many big organisations are taking them seriously. If a large network such as Alibaba, Facebook, or Google started taking the idea of non-sovereign online currencies seriously then we could see big changes ahead in many industries – retail and banking first.

What is fascinating to see now is how many technology trends are becoming ubiquitous and consumer-focused. We are no longer talking about business-focused issues such as network strategy or cloud computing. Many of these changes are driven by technology, but are being demanded by the end customers. The divide between enterprise and consumer technology is becoming very narrow indeed. As we now enter the final quarter of 2017 I’m going to think a little more about this in some future blogs – where should the IT industry be focused next year?

How IT Leaders Can Learn From Big Data Industry Changes

IBA Group
Mark Hillary

The Big Data market has transformed how most IT services are bought and sold. Often the customer is a business leader, rather than the CIO, and services are already available, rather than needing to be designed from the ground up.

IT leaders often look at other companies to see what they are doing, it’s usually known as best practice, but what if the entire market is in a state of flux? Some IT companies are now delivering radically different solutions to others. Innovations like the app store concept and cloud based solutions are changing the way that IT services are delivered globally, so how can changes in the Big Data market change how the entire IT industry behaves?

Techrepublic magazine recently outlined some important changes in how IT leaders think about their marketplace. Think of these 5 different changes as examples of what is changing and how it can influence the behaviour of IT leaders:

1.    Off the shelf analytic solutions like Watson from IBM have been customised to be used across many different industry verticals. It’s the same system, but modified for different environments and it can therefore offer immediate results. Everyone is looking for a rapid return on investment today.
2.    Commodity hardware offers a great platform for storage if you are going to keep your data and analytics system internal, rather than in the cloud.
3.    More companies are relying on their suppliers for expertise and innovation today. These are true partnerships now, not just outsourcing arrangements where the cheapest supplier gets the project.
4.    Analytics reporting systems like SAS are still important because they have been tested and developed over so many years, but also because the users are really familiar with the way these systems work. Familiarity is important.
5.    Real time processing systems are changing the way that physical infrastructure is designed and deployed. Look at SAP HANA for an example of how systems using memory in new ways are now feeding back into the design of the physical servers and databases.

What do you think about the lessons from Big Data? Have you seen other ways in which IT is more generally changing because of the way that Big Data is influencing IT strategy? Please leave a comment here.

Carmakers Move Research To Eastern Europe After Brexit Vote in UK

IBA Group
Mark Hillary

One of the manufacturing myths common in the UK is that nobody builds anything any longer – it’s popular to suggest that the UK used to manufacture products such as cars, but today that business has all vanished. However the numbers make the situation look rather different. Last year around 1.6m cars were manufactured in the UK, which was the highest figure for a decade.

But 2016 brought the Brexit vote and some potential changes to the auto manufacturing industry in the UK. The recruitment company DHR has suggested that auto manufacturers are shifting high-end work such as research and development over to Eastern Europe. Their data is supported by the news that companies such as Jaguar, Audi, and Renault have all recently invested in Eastern European expansion plans.

However, I believe there is more at play here than just the Brexit vote changing how cars are designed and manufactured. What we think of today as a car is changing faster than ever and the research function is about more than developing the next generation of sound system. The entire auto industry is being redefined around technology and the car makers that get this right will win a substantial market share.

There are three areas where I think technological research is redefining the entire auto industry and this summarises why the locations where the R&D take place will be at the heart of planning the future of this industry.

1. Electric vehicles; Tesla has shown that electric vehicles can be popular, but the price is still out of reach for regular consumers. As the regular brands invest more in R&D and battery design we will see an enormous change in this market.
2. Internet of things; cars just becoming a part of your home network will be normal. This will allow cars to self-diagnose problems and talk to the manufacturer without the owner being involved in addition to synchronising to your home – perhaps something as simple as playing the last song you had on in the house when you start the vehicle.
3. Self driving cars; we have seen that it is mainly tech companies that seem to be progressing in this space, but if the mainstream auto brands want to define the future then they need to also be investing in this space.

All this shows that the future of the car industry looks more like the technology industry with integration into networks, the Internet of Things, new battery technologies, and the ability to function without human interaction. There will be a strong crossover between the IT business and the auto business in the near future and it looks like a lot of this work will be taking place in Eastern Europe.

Why Using Cell Phones at Work Can Be a Good Thing

The recent Innovation issue of PULSE Magazine, a bi-monthly e-zine created by and for IAOP’s members, published an article by Sergei Zhmako, IBA USA General Manager. The publication titled Why Using Cell Phones at Work Can Be a Good Thing focuses on social and mobile tools and their place in the corporate strategy of an enterprise.

According to the article, mobile and social technologies, being a strong trend in the consumer market, have become a top priority for most enterprises. With two billion people across the globe using social media and half of the web traffic coming from mobile devices, organizations actively employ these technologies in their work environment.

Mobile and social technologies enable easier communication and collaboration between employees and provide an instant access to business information and learning materials.

Despite bringing exciting opportunities, social and mobile technologies may also bring a number of challenges, as transition to them requires additional skills and effort.  The article gives ten recommendations to consider in a mobile or social engagement. Here are top three of them:

1. Engage Users Early – companies must strive to engage users at the early stages of the project lifestyle, including prototyping and receiving quick feedback from focus groups.

2. Consider Added Features – new features, such as a GPS location sensor, camera, or mike, could be added to solution if such need arises.

3. Change Your Culture and Make It Fun with Games – gamification can contribute to easier transition to enterprise mobility.

You can read the full article here.

Engaging Customers in 2020

IBA Group
Mark Hillary

Last month I was in London giving a keynote address to the Engage Customer audience focused on the customer experience in 2020. This event is focused on the entire industry that surrounds customer service and how it can be delivered.

You can see my slides here, but I thought it was worth mentioning this presentation to a more IT-focused audience because the biggest change that is taking place in the customer service industry is the introduction of various technologies that are improving how customers can be managed.

Look at the list of six technologies that I believe will be making a big change to the customer experience in the near future:

· Virtual reality; with Facebook investing heavily in Oculus and their Rift system, this will be a far more common technology in the near future.

· Augmented reality; as Google creates a version of Glass that does not look like a computer on your face this will return.

· Wearables; already common for fitness and health, they will eventually replace the telephone.

· Internet of Things; tech that can diagnose and fix problems without the human being involved – imagine if your car could fix itself?

· Automation / Robots; replacing mundane tasks with robots, even in contact centres.

· Location Awareness; retailers able to send you a one-hour offer because they know you are near to a store.

Many of these technologies are in the process of being adopted and others will become more important in daily life in the near future, however, as you can see from the presentation slides, I mention various other technologies that will soon change how customers interact with brands.

· Omnichannel; companies are connecting together all those channels that customers are using and creating new opportunities to win business. The L’Oreal virtual make-up app is a great example of changing the way that beauty products are sold.

· Fintech; banks are finding that new start-ups are picking individual banking services, creating them online or on an app, and winning customers. Entire full-service banks are now being launched using the app as the central point of interaction.

· Communication; every communication from shopping to politics to finding a new partner is changing and becoming electronic – how does this change in the way people communicate everyday change the way your business operates?

What is clear to me is that the customer experience is a great consumer of new and innovative technologies. More people in IT and IT services need to consider how they can work with experts in the field of customer experience because managing customer interactions is about far more than managing a contact centre today – it’s a business area that is entirely driven by technological change.

IAOP Recognizes IBA Group in New Global Outsourcing 100

IBA Group
Irina Kiptikova

On April 16, the International Association of Outsourcing Professionals (www.iaop.org) released the second blog article devoted to The Global Outsourcing 100® list. This article recognizes companies for innovation programs.

The Programs for Innovation category of the IAOP’s Global Outsourcing 100 focuses not just on specific examples but on the programs that service providers and advisors have in place to identify and implement innovative solutions.

Today’s customers demand innovation from their providers and the outsourcing industry is looking for new ways to meet this growing demand. IAOP evaluated programs for innovation in The Global Outsourcing 100 for the first time.

IBA Group earned the highest 8 points in this category. The company received a full star recognition and its achievements in innovation were marked as the ‘Highest Rated’. This accomplishment looks especially impressive because the average score for innovation of the participating companies was 3.52.

IBA Group showed in its application that innovation is not a one-shot job for the company. IBA Group set up a Committee for Innovations headed by the IBA Group Chairman and created a company-wide Registry of Innovations. A special procedure on how to apply and approve or reject the ideas was implemented in the IBA intranet and a special venture fund was formed to finance the innovation procedure.

IBA Group implemented many successful initiatives through this procedure, including a mobile version of the IBA’s enterprise content management system and an Automated Fare Collection (AFC) system that earned a European IT & Software Excellence award for IBA Group.