Slide 1

1 ELIMINATING THE BLIND SPOT THE FUTURE IS NOW - GAME ON April 2, 2012

Slide 2

2 ELIMINATING THE BLIND SPOT Impact Of Technology And Innovation On Business Models

Slide 3

3 in your hand Travel to Vienna to hear Mozart Visit a concert hall or on the run or in stereo Enabled at home in the car Catch it THE MUSIC INDUSTRY MARKETPLACE WHY

Slide 4

4 4 LETS ZOOM OUT EVEN FURTHER WHY

Slide 5

5 ~40,000- 60,000 years ago 3,500 B.C. 1700 14551800190019502000 History of Innovation Business Model NATIONAL Wal-Mart / Frito-Lay MULTI-NATIONAL Frito-Lay / Sabritas / P & G REGIONAL A&P Grocery Store / Coke Distributor Farmer to MarketGrocery Store LOCAL IMPACT OF TECHNOLOGY WHY

Slide 6

6 The Journey Technology explosion Mainframe Personal Networked Computing - Internet IT Everywhere ACCELERATED IMPACT OF IT ON COMMERCE IN JUST 50 YEARS WHY

Slide 7

7 ~40,000- 60,000 years ago 3,500 B.C. 17001455180019001950 2012 History of Innovation Physical Electronic Technology / Innovation Business Model Global Logistics Virtual Business Video Game GLOBAL 2000 IMPACT OF TECHNOLOGY WHY

Slide 8

8 IT LEADERSHIP CHANGING THE DIALOGUE Shared / Aligned Mental Models Marketplace Model Business Model Systems Model Organization Model WHY WHAT HOW WHO CHANGING THE DIALOGUE IT LEADERSHIP Requires a Management Framework

Slide 9

Customer Power Price Transparency Leverage the Brand Compete on Value Price at Customer Level Speed and Innovation Operationally Excellent Flexible Cost Structures Its Not About Centralization or Decentralization Anymore Margin Erosion Revenue Cost Segment of One Innovation Synergy/Collaboration/ Operational Excellence Playing the Game Changing the Game Global Logistics Modern 21 st Century Models Virtual Business Video Game /LOCAL NATIONAL/ MULTI-NATIONAL GLOBAL/REGIONAL/ Customers Business Model Matters 9 Its About AND, AND, ANDAND AND BUSINESS MODEL WHY

Slide 10

10 Why companies fail They DIDNT see it coming They saw it coming but DIDNT deal with it They saw it coming but DONT know how to deal with it They saw it coming but couldnt deal with it COMPANIES ARE STRUGGLING Game On WHY

Slide 11

11 Why companies fail SHOULD WE CHANGE? WHY

Slide 12

20 TH CENTURY BUSINESS MODEL 12 Decentralized Store Centric The Home Depot Centralized Supply Centric Walmart WHAT

Slide 13

13 Both Supply Chain Centric AND Store Centric 21 ST CENTURY BUSINESS MODEL WHAT

Slide 14

14 IMPACT OF TECHNOLOGY ON FRITO-LAYS BUSINESS MODEL WHAT

Slide 15

15 FRITO-LAY 1930s 1970s WHAT

Slide 16

16 LOCAL SALES & MARKETING LOCAL SUPPLY CHAIN EVERY RETAILER HAD THE SAME BUSINESS MODEL WHAT

Slide 17

17 ENABLED BY MAINFRAME TECHNOLOGY WALMART MODEL 1980s FIRST MAJOR CENTRALIZED SUPPLY CHAIN WHAT

Slide 18

18 ENABLED BY MAINFRAME TECHNOLOGY WALMART MODEL 1980s FIRST MAJOR CENTRALIZED SUPPLY CHAIN WHAT

Slide 19

19 LOCAL SALES & MARKETING NATIONAL SUPPLY CHAIN WALMART CHANGES THE GAME FOR FRITO-LAY WHAT

Slide 20

20 REGIONAL SUPPLY CHAIN LOCAL SALES & MARKETING EVERY RETAILER HAD A DIFFERENT BUSINESS WHAT

Slide 21

NATIONAL SUPPLY CHAINREGIONAL SUPPLY CHAINLOCAL SUPPLY CHAIN 21 Operations Leverage Customer Route Product/Price Mfg Plant... 1,000s of Variations Customer Segmentation AND Regionalized Model Centralized Model Purchasing Manufacturing Distribution EVERY RETAILER HAD A DIFFERENT BUSINESS MODEL ADDING TO THE COMPLEXITY OF THEIR SUPPLIERS HOW

Slide 22

~40,000- 60,000 years ago 3,500 B.C. 17001455180019001950 History of Innovation Physical Electronic Technology / Innovation Business Model Global Logistics Virtual Business Video Game GLOBAL 2000 IMPACT OF TECHNOLOGY WHY 20222012 ? 22

Slide 23

The Four Horsemen of Dominant Design Robert B. Carter Executive Vice President, Information Services Chief Information Officer, FedEx Corporation 23

Slide 24

ServerNetworkStorageSoftware 24

Slide 25

Transistor Count 2,300 12 1971 1980 1990 2011 80808088286 486 Pentium 3,000,000,000 Quad i7 2,250,000,575 1,500,001,150 Core 2 Duo 750,001,725 1 358111719 2000 25

Slide 26

Kbits/s 250,000 200,000 150,001 100,001 6 1 1976 1980 1990 20002010 50,001 1200 Baud 14.4k Cable/DSL DOCSIS 3 Cable Modem WDM Optical Networks 300,000 26

Slide 27

1956 - IBM 350 Hard Disk 5 mb 2011 - MicroSD 64,000 mb 27

Slide 28

28

Slide 29

Scale-Out x86Pervasive IPIntelligent StorageSoftware 29

Slide 30

Cloud Computing 30

Slide 31

~40,000- 60,000 years ago 3,500 B.C. 17001455180019001950 History of Innovation Technology / Innovation Business Model 2000 IMPACT OF TECHNOLOGY WHY 20222012 ? ? 31

Slide 32

21 st Century Economic System in Motion WHAT Tracking # April 3rd Order iPad 32

Slide 33

~40,000-60,000 years ago 3,500 B.C. 17001455180019001950 History of Innovation Technology / Innovation Business Model 2000 IMPACT OF TECHNOLOGY WHY 20222012 33

Slide 34

New Business Models Require New Systems Models HOW 34 Event Enabled In Motion, In Memory, In Models

Slide 35

35 The Future is Now - Game On The Chief Information Officer is too limiting Needs to be Chief Integration Officer CIO has a critical leadership role CHANGING THE DIALOGUE IT LEADERSHIP

Slide 36

36 Do I really need a CIO or can I just outsource everything? Very few big transformational activities have ever worked. No one takes three years to do anything. The world is moving too fast. Wont cloud computing. Eliminate the need for an IT department. Why CIOs Are Last Among Equals Wall Street Journal May 24, 2010 Current Dialogue is Going in the Wrong Direction THE JOURNEY Weve Got to Eliminate the

Slide 37

37 IT LEADERSHIP CHANGING THE DIALOGUE Shared / Aligned Mental Models Marketplace Model Business Model Systems Model Organization Model WHY WHAT HOW WHO CHANGING THE DIALOGUE IT LEADERSHIP Requires a Management Framework

Slide 38

38 Customers Matter Segment of One Net Promoter Physical BANK AND BRANCHES BRANCH CENTRIC WITH MOBILE TECHNOLOGY BANK Electronic BUSINESS MODEL TECHNOLOGY / INNOVATION MainframesInterstate Highway TelephoneAutomobile Telegraph Distributed Computing Air Travel Horse & Buggy BRANCH CENTRIC WITH BASIC TECHNOLOGY BUSINESS MODEL BANKING EXAMPLE WHY

Slide 39

39 CURRENT STATE CUSTOMER Data Isolated views for products & services from different channels Data Wealth Comm. Lending Retail Lending DepositDerivatives Credit Cards Securities Lending Prime Brokerage Insurance Corp Lending Fixed Income Equity WHAT Capital MarketsRetail BankPrivate Bank Net Detractor Anonymous Game

Slide 40

40 DIGITAL PERSONAL BANKER WHAT Any Channel, Any Where, Any Time CustomerFinancial Advisor Integration Bus business rules Digital Personal Banker Event-Enabled Personal Digital Banker Framework s Blue Prints

Slide 41

41 PHYSICAL / ELECTRONIC FINANCIAL SERVICES HOW Event-Enabled Personal Digital Banker Financial Advisor Customer

Slide 42

42 DIGITAL PERSONAL BANKER HOW Any Channel, Any Where, Any Time Financial AdvisorCustomer Integration Bus Event-Enabled Personal Digital Banker

Slide 43

43 DIGITAL PERSONAL BANKER HOW Any Channel, Any Where, Any Time Financial Advisor Integration Bus Customer Event-Enabled Personal Digital Banker This is the Durable Asset

Slide 44

44 BUILD TO A MODERN FUTURE STATE BUSINESS PROCESS AND TECHNOLOGY ARCHITECTURE Embracing Heterogeneity Architectural Elevation BOM & Pre-Fabricated Components Systems Architecture Wiring Diagrams Frameworks Blue Prints Spec Home Functional Systems Customer SYSTEMS MODEL MODERN 21 ST CENTURY HOW

Slide 45

45 THE IT LEADERSHIP PROFILE Critical Leadership Competencies for Successful Transformation Setting the Agenda Building a Great Team Consistently Delivering Build Main Build Scorecard LEADERSHIP MATTERS WHO

Slide 46

46 A MULTI-YEAR JOURNEY WHEN GAME ON Building the Multi-Year Plan The Turn Hitting Stride Accelerating FY12 Q2 FY12 Q3 FY11 Q4 FY11 Q3 FY13 Q1 FY12 Q1 FY13 Q2 FY14 Q1 FY12 Q4 FY13 Q3 FY14 Q4 Sturdy Operating Mechanisms Up and Running Locking on a New Course Delivering the New Way Agility Sustainability This is The Right Fight

Slide 47

47 For a copy of this presentation or to order Blind Spot please visit www.thefeldgroupinstitute.com