Digital Transformation – from customers, to technology, to people

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Estimated reading time: 5 minutes.
Audience: Management

Digital Transformation is, no doubt, one of the hottest current topics. I was invited the other day to a most interesting round-table discussion on why the customer should be at the heart of a digital supply chain strategy. It was a brilliant exchange of views from across the industry – and my thanks go to @TobyWright and to @JohnMcNiff for organising the round-table, at The Telegraph.

In preparation for the round-table I put some thoughts together on the subject of Digital Transformation. I’d like to share them with you and incite some comments. Here we go.

Take your employees along on the digital transformation journey

Customer-centricity is absolute key to a successful digital transformation. My approach to a digital transformation is to start with understanding the customer, then design the business digital strategy around it, then look at the Data, People, Processes and Technology required to support it.

Considering that the customer’s needs and behaviours change and evolve, it is critical to build agility in the organisation’s structures and processes, so that the organisation can evolve as well. This is where engagement with employees becomes critical. I involve staff as early as possible in the design of the cross-functional teams, to build the agility required by the company. This follows training of employees and a continuous improvement approach, where processes and technology are further optimised.

The digital transformation mantra of “customer centricity” needs to be extended to internal changes as well. When changes are introduced to internal processes and technology, staff need to be treated as customers in relation to the respective tools. When they are not, it creates gaps that are reflected in poor technology adoption and ineffective new processes.

Make the most out of new tech

The greatest opportunities come from the way one can combine these new technologies, as building blocks for an engaging and coherent experience to the customer. We need to re-think e-commerce interaction, reaching customers in a familiar environment through deep marketing, and offering them a meaningful and guided experience. Machine learning and AI, coupled with solid data are core ingredients – from smart Customer Relationship Management, to friction-less Enterprise Resource Planning, to intelligent CPQ (configure, price, quote), etc.

Get data right. Seriously.

I’ll keep this short as talking about data is a guaranteed way to put people to sleep 🙂
Data is the cornerstone for a digital transformation. By data I mean both the data structures (fields, relationships etc), and the actual information that populates these structures. Data structures and models need to be mapped and defined. Data quality needs to be managed and should give you a good understanding of how complete, unique, timely, accurate and consistent it is.

Getting someone who can understand data and can drive the effort of keeping your data clean is essential. Artificial intelligence, machine learning, all those advanced technologies that you want to take advantage of, won’t work without good clean data. The principle of garbage in – garbage out still applies.

Overcome barriers while turning your data into insights

Skills, Repository, Tools, Security, Integration, Costs, Buy-in – these are all barriers that need to be overcome when turning your data into insights. Regardless of whether the data is in the cloud or not, the most important factors relate to your analytics team. My favourite recipe is to embed a data scientists (someone who is genuinely curious about data) with a business team (who have the business expertise) and with a good storyteller. The data scientist finds what looks to be of potential interest, the business team validates its relevance, and the storyteller describes this in a way others in the company can make sense of it.

After getting the analytics team sorted, the next question is how you democratise access to insights – which is key if you want to have a data-driven organisation. This is where data architecture plays a heavy role – defining the best repository for the type and size of your data. Is it structured, is it big-data, is it going to grow? Then comes the visualisation element – how are you going to empower your staff to access analytics? The interfaces play a significant role here. Depending on audience and the type of insight, you might need self-service dashboards for common reports, and advanced tools for data exploration and deep insight.

The architecture and its interfaces need to be reviewed by cyber security and legal (think GDPR), and then you need to have a cost estimate. Be aware of the data gravitation – the more data you have in one location, the more other data and applications it’s likely to attract, and for cloud models, this is going to impact future costs.

Last but not least, implement an awareness program to ensure buy-in from the right audiences. Insight can go against gut-feel, and there is a need for introducing analytics in the right way to ensure staff embrace it and see the value added to their job.

Get the right people with the right skills

My technology operating models are of the type “IT Light” and “cloud-first”, and this drives the type of skills I am after. This meant that I have to buy, steal, borrow and develop people with skills in agile development, automated testing, dev-ops, infrastructure-as-code, etc. Data analytics skills is an area that is more complex, not only because of the complexities of the field, but because an organisation most benefits when the analytical skills are complemented with business ones. Depending on the situation, there is a judgement call to be had. Is it more effective to get a data specialist trained to understand the business, or a business person to understand data analytics? On the latter one can take advantage of government apprenticeships schemes, to train junior staff into becoming the next data analysts embedded with the business. The time it takes to get these skills on-board varies, and the shortest path might be just to combine data analysts and business people in a multi-disciplinary team – which brings me back to the agile approach… 🙂

 

Is a degree relevant to IT Professionals?

Woman Internet Network One At Stylish Binary

Here is an article in which Alison DeNisco (@alisondenisco) reveals that 75% of tech leaders don’t require a computer science degree for developers and IT pros, published on February 19, 2018 in TechRepublic’s CXO Section.

My position? Different:

While the nature of the role dictates if there is a requirement for a degree or experience, for broader roles such as analysts or architects, the degree is a requirement along with other professional requirements, said Flo Albu, Group Chief Digital Officer for Westcoast.

“As a recruiter, a university degree gives me the reassurance that the person has been exposed to the necessary wide array of subjects in the respective area,” Albu said. “These are subjects that otherwise most people won’t cover in their own time. Apart from this exposure, it is the structured way of thinking taught in universities, that I find valuable for certain roles.”

There are exceptions to this rule, of course, Albu added. However, he found that degree-educated applicants tend to be more able to formulate the right questions that need to be answered, which will eventually help them avoid becoming automated. “This is the skill that ultimately will allow one to avoid being commoditized,” Albu said. “Knowing how to formulate the problem is what would set one apart, in an era where finding the solution to that problem is more and more a job for the computer.”

Read the full article here:

https://www.techrepublic.com/article/cio-jury-75-of-tech-leaders-dont-require-a-computer-science-degree-for-developers-and-it-pros/

Implementing Artificial Intelligence tech

Blue Machine Look Mechanical Eye Lens Bionics

Here is an article in which Alison DeNisco (@alisondenisco) reveals that only a third of tech leaders are implementing AI tech, published on April 10, 2017 in TechRepublic’s CXO Section

My position?

“We are planning to take advantage of the benefits brought by machine learning, AI and advanced analytics”, said Florentin Albu, CIO of Ofgem E-Serve. “We are at the stage of active exploration through proof of concepts, to educate the business in what is possible, and to gain a better understanding of potential challenges.”

As you begin implementing AI and machine learning, it’s also a good time to review your company’s data monetization strategy and data architecture, Albu said, as they are critical factors for delivering benefits.

Read the full article here:

http://www.techrepublic.com/article/cio-jury-only-one-third-of-tech-leaders-are-implementing-ai/

On digital transformation

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Here is an opinion poll among tech leaders, on the interest that businesses might have in digital transfromation, by Alison DeNisco (@alisondenisco), published on February 17, 2017 in TechRepublic’s CXO Section

My position?

For Florentin Albu, CIO of Ofgem E-Serve, “the digital transformation in our case is closely linked to the improvement of customer journeys, and to an optimization of business processes that will lead to operational excellence,” he said. “New technologies and the younger demographic are key factors considered in this transformation.”

Read the full article here:

http://www.techrepublic.com/article/cio-jury-more-than-half-of-cios-have-no-formal-digital-transformation-plan/

Blockchain – what is it and why should the energy sector care?

image1Having already taken the finance industry by storm, the Blockchain technology has started to attract a lot of interest from other sectors. While being on the panel for one of the debates at the excellent Blockchain Expo in London this January, I realised that more and more business executives want to join these discussions, and would benefit from a relatively non-tech introduction to it. So here are the basic concepts, with some the added thoughts on why it should be relevant to my current industry – the energy sector.

What on earth is a blockchain?

In a nutshell, a blockchain is a distributed database that facilitates secure online transactions.

The entries in this database (records, or more precisely, blocks) are designed to be secure. They have specific mechanisms through which they link to each other in a way that makes alteration of their data virtually impossible.

From this point of view, a blockchain can be considered a secure ledger that does not require a trusted administrator, and which is suitable to recording sensitive information and demonstrating chronology of ownership.

A blockchain can be also understood as largely an append-only ledger for recording the history of transactions. The ledger exists in multiple copies across the participants to that blockchain (which are synchronised all the time), and uses a system of decentralised consensus, whenever a change is required for the historical data stored in the ledger. This means that participants in the blockchain can record new transactions in the ledger, however if one needs to alter transactions that were recorded previously, this can be done only with the consensus of the other participants.

All information that is present on a blockchain, as well as the operations executed within the context of the blockchain, are called “on-chain” – everything else is off-chain. This has relevance when one tries to bridge the digital world (on-chain, secure) with reality (off-chain, insecure).

Evolution of the blockchain

The first generation of blockchain is considered the one supporting digital currencies, such as bitcoin.

As the security of the blockchain proved itself, additional features were added to this technology in a second generation, and this was done as the blockchain platforms diversified (e.g. Ethereum, Hyperledger, etc.).

The most important new feature was that of a smart contract. This is in effect a piece of computer code that runs on a blockchain. This code defines the rules and consequences in the same way that a traditional legal document would, stating the obligations, benefits and penalties which may be due to either party in different circumstances.

The purpose of a smart contract is to enable two anonymous parties to do business with each other, without the need of a middleman.

A smart contract can be automatically executed by a blockchain. Because the blockchain is a secure platform by design, it allows for the smart contract to be trusted by the blockchain participants.

The challenge comes from the interaction with the real world– for example the smart contract needs information such as price points in order to trigger its execution. Who can be trusted to inject this information into the blockchain?

The revolution: blockchain 3.0

Enter the “oracles”.

An oracle is an entity trusted by the blockchain and its participants, and which can securely present the blockchain with claims about the real world. These can be soft (e.g. an oracle that introduces official kwh prices into the blockchain) or hard (e.g. an energy meter that introduces energy consumption or production data into the blockchain). The keyword here is “trusted”, which would mean a cryptographically attestable and tamper-proof way of providing the real data, thus allowing for off-chain interaction.

The details behind blockchain 3.0 are still crystallising, and while they do so, industry touts this technology as the next revolution of the Internet. While blockchain 1.0 and 2.0 have been largely applied to the financial sector, blockchain 3.0 will have particular relevance to industries, government and education. It is worth noticing that the technology gradually becomes available more broadly, and one of the leading efforts in this regard comes from Microsoft, with its Bletchley initiative – Azure support for blockchain infrastructure “in the cloud”, since November 2016.

This sounds familiar…

How is this different from regular (complex) computing systems?

The key difference is that a blockchain is a distributed, secure-by-design platform with the capability to execute autonomous smart contracts which include financial operations, without the need for a trusted central authority.

Enough with the theory – how is this relevant to the Energy sector?

In April 2016 a first blockchain-managed energy trading transaction took place in New York. A small solar micro-grid venture enabled residents to sell each other solar energy, without the involvement of national utility companies. The historical transaction was made by the owner of a solar roof panel who sold a few kWh to a neighbour, using a smart contract on the Ethereum blockchain.

In November 2016, a mWh energy trade took place between two European energy companies (Yuso and Priogen Trading). This was done on a specific blockchain platform developed for the energy sector, Enerchain, and which showed the possibility of creating a peer-to-peer energy marketplace that does not require a centralised platform or authority.

Clearly, the above are proof of concept examples, however the industry develops quickly. Take the Bitcoin for example. At the end of 2008 it was presented as an idea. 8 years later it has about 16 million bitcoin in circulation. 1 btc is valued at over $1000 as of Jan 2017, and companies such as Ernst and Young, Microsoft, Dell, Expedia and PayPal are accepting it for payments.

While in its infancy, the technology has potential advantages to the energy sector. It could lower the barriers to entry for the energy marketplace. With its secure and distributed ledger it can offer a trusted and transparent way of recording transactions, both for the energy generation as well as for its consumption. Its trusted nature means that peer-to-peer transactions can be accomplished without intermediaries, and this could streamline the energy distribution.

The blockchain platform could ease the process of verification for green energy, and also allow for the direct trade of renewable obligation certificates.

Last and not least, blockchain 3.0 could open up new possibilities, when coupled with other developments in technology and in the energy sector. One could envisage the scenario of a “smart” house, where the smart meter is a participant in a blockchain 3.0 energy trading platform. The smart meter acts as an economically independent machine with its own digital wallet. Smart contracts that are associated with the meter will allow it to autonomously trade excess energy that is produced by the household (solar/biomass/etc), or purchase at the most advantageous rate based on the market offer – perhaps even securing a low rate for an extended period.

Conclusion

Considering the potential of the blockchain technologies, their application to various sectors (in addition to finance) should be closely followed, in order to understand what opportunities develop and how they could transform the market.

Some further info:

1st Blockchain:

The Bitcoin was the first application of blockchain technology. Bitcoin is a form of digital currency that was designed and implemented in 2008/2009 by an unidentified person that goes by the name Satoshi Nakamoto. The bitcoin blockchain is the public ledger of all transactions ever carried out with bitcoin and it has resolved the double spending problem which inherently affects digital cash. As of Jan 2017, there are more than 16M Bitcoin in circulation. Microsoft, Ernst and Young, Dell, Expedia and others accept bitcoin.

A note about encryption:

Blockchains use established security technologies such as public/private key encryption. This type of encryption uses 2 sets of characters called keys. One key can be used only for encryption and it can be safely made public by its owner, so that anyone can encrypt information addressed to the owner. The other key is only used for decryption, and the owner keeps it private. Public key encryption is considered secure as there is no need to exchange decryption keys. This encryption is also used for digital signatures.

Digital currencies that use encryption technologies are also called cryptocurrencies.

 

Beauty vs. Commodity in the Enterprise

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Here is an article on the new 2016 Apple MacBook Pro, and the interest that businesses might have in it, by  Alison DeNisco (@alisondenisco), published on November 18, 2016 in TechRepublic’s CXO Section

My position?

 

“Considering how mature cloud digital workspaces such as Office 365 have become, the desktop/laptop hardware has lost its relevance,” said Florentin Albu, CIO of Ofgem E-Serve.” With such devices being a commodity, price plays an essential role in their selection. Beauty comes at a price, and in this case the business case for using MacBook Pros in the enterprise would be difficult to articulate.”[…]

Albu said that, for his business needs, a user environment centered around Office 365 and Surface tablets makes more sense. “As such, we don’t plan to actively support other portables for now,” he said.

 

Read the full article here:

http://www.techrepublic.com/article/cio-jury-two-thirds-of-it-leaders-say-their-company-wont-support-the-2016-macbook-pro/