Digital Transformation How We Are Digitally Transforming Our Future & What it means for us?

Manoj Menon

Senior Partner & Asia-Pacific Managing Director

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POKEMON BREXIT MAKE AMERICA GREAT

AGAIN DEMONETISATION

INNOVATION FINTECH GROWTH DUTERTE PHILIPPINES

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Competitive landscape is changing

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Competitive landscape is changing

Competitive landscape is changing

Death by Thousand Cuts? Freight Logistics Industry Experiencing Sweeping Transformation of the Scale Last Seen in 1990s

When IT Revolutionized Logistics

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Demand Generator Mediator Freight Forwarder Delivery of Freight

Loading/ Unloading Create Shipment

Fast Ship

Pack Shipments

Loading/ Unloading

Document Management

Mobile Based

Brokering

Schedule & Manage

Pickups

Payment –

Generate Bills

Load Boards

Get Rates and

Transit Time

SHIPPER BROKER WAREHOUSE

Quality Management

Inventory Management

Yard management

Last-mile Delivery

Navigation

Returns

Management

Resource

Management

Transportation

Management

Logistics

Management

CARRIER

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“This transition from one

world to another is the

great human drama on

which we need to shed

light”

Fernand Braudel, on History

Source: WEF

4th Industrial Revolution – Digital Transformation

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The Steam Engine

Industry 1.0

Source: WEF

1 2 3 1900 2000 1 1800 4 2020

Industry 2.0

Henry Ford’s T-Model

IT-OT Convergence

Industry 3.0

Industry 4.0

Digital Transformation

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Every company is

a Technology Company

Digital is Basic Infrastructure

and GIVES YOU A SEAT AT

THE TABLE

#a

Fulfilment

Center 110

Hub

120a

Hub

120c

Hub

120b

Private

carrier

Common

carrier

TENDER TO COMMON

CARRIER AT FULFILMENT

CENTER

Delivery

location 130

Non-

expedited

service path

TENDER TO COMMON

CARRIER AT HUB

#b

Top Technologies to Watch

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$6.9 billion in 2017

Improved accuracy drives greater used cases

China becomes Hyper Robotic Society Commercial launches of Drones in 2017

AI personal

assistant race

for dominance

Cognitive is the

NEW SMART

Alexa, Siri, Google’s Personal Assistant

Robotics &

Drones go

mainstream

Rise of Automation and It’s $60Bn 2030 Market

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Human Machine Change in Responsibility

Level 0 Level 1 Level 2 Level 3 Level 4

No

Assist

Early Warning

Systems Traffic Control

Awareness for

Takeover General Awareness

Full Autonomous

Driving

Level 5

Current Level

2030 2025 2018 2016 2011

Feet Off

Hand

Off

Eyes

Off

Mind

Off

Brain

Off

Windshield status updates, direction optimization, shipment

location in truck

Logistics

Trucking

Augmented Reality Applications for B2B

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Global collaboration that brings workers together in the same

environment Workplace

Visualization and rendering of large scale products and buildings in

situ, upgrading buying experience Sales

Accurate graphic overlays, instruction overlays, remote expert dial-

in

Training and

Repair

Rapid prototyping visualization to detect usability Prototyping

Visual cues for optimized picking route and picking verification Logistics

Picking

A sentient tool

is a tool that

can think and

is aware of

both its

surroundings

and the

person using

it

Sentient Tools Will Transform IoT and #Digiruption

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Situational Awareness

Sensing the outside world

Intelligence

Making sense of the world

Social Awareness

Understanding who it is working with

Communication

The ability to communicate with humans

The 4 Components of a Sentient Tool

4D Printing Will Arrive

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Note: The timeline has been illustrated based on a scenario building analysis where factors such as technology’s

stage of progress (prototype or licensed), level of big player activity, and acknowledgements from thought-leaders

have been considered to analyse the evolution of impact.

Commercial 4D Printing Environmental Manufacturing Self Assembling Materials

Holds potential to revamp manufacturing

introducing a new field of environmental

manufacturing in which ambient sources

of energy, water or even light will be

used as impetuses to self-assemble

Exploring materials

and understanding

reaction to external

elements

Industry application will

be explored with cost of

technology more suited

for industrial applications

2015 2035 2045 2013

3D Printing

Source: Frost & Sullivan Image Resource

From Whisper to Trend Evolution

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#2 Convergence of Digital, Physical &

Biological Worlds

Our bodies will

be so high tech

it will be difficult

to differentiate

what is real

and what

is not

This revolution

will not only

change what we

are doing, it will

change us

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Pay as you go –

Product as a Service

N = 1, R = G

Co-creation of value;

Platform Play

Three major themes

Product-as-a-Service More than 70% of the fortune 500 companies plan to offer products as a service by 2020

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>70%

of fortune 500 companies

will operate product-as-a-

service business models

by 2020

15%

Energy

Healthcare

Telecommunication

Aviation

Electronics

Automotive

8%

3%

13%

8%

8%

#4 Platform

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Unlock Excess Capacity

Potential for Open Innovation

Personalize

Software Oriented

We have moved from building economies of scale to building economies of

platform.

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4

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So What does it mean for us ?

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Umbrella

Medicine

Less-informed

Patients Invasive

Procedures

Treatment

Focus

Present: Hospital as the Center of Focus

Future Patient-centric Healthcare System Patients today have more access to health information than ever before; this leads to a patient

base that has taken personal responsibility of their health and demand more from their

physicians

Source: Frost & Sullivan

Future: Patient as the Center of Focus

Social

Media

Technology

Access Wellness

Programs

Personalized

Medicine

Integrated, Two Way

Decentralized, Community-based

Patient Centric

Personalized Medicine

Collaborative, Shared Information

Outcomes-based

Preventing Sickness (Wellness)

Fragmented, One-way

Centralized, Hospital-based

Provider Centric

One Size Fits All

Fragmented, Specialized

Procedure-based

Treating Sickness

Trends Impacting Entire Spectrum of Care

A modern health care system is on the horizon, demanding a paradigm shift

Information flow

Location

Focus

Approach

Treatment

Reimbursement

Objective

FROM... … TO

Source: Frost & Sullivan analysis

Is the future of mobility James Bond… 31

or… Jason Bourne! 32

From car configurator to mobility configurator In future, industry stakeholders will showcase mobility integrators on line

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DEMAND RESPONSIVE TRANSPORT (TAXI, BRT)

CONNECTED LIVING (including car)

INTERCITY PUBLIC TRANSPORT

CAR LEASING

CAR RENTAL

CAR SHARING & POOLING

INTRACITY PUBLIC TRANSPORT

PHYD INSURANCE

DYNAMIC PARKING

CONCIERGE SERVICES

ENERGY MANAGEMENT

MICRO-MOBILITY SOLUTIONS

TRAINS/FLIGHTS INTEGRATION

APPS, JOURNEY PLANNING, BIG

DATA

Bricks and Clicks: Next Generation of Retailing

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May 6, 1954

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To win a race, they say, you have

to beat everybody who shows up

on the day, but to set a world

record, you have to beat

everybody who’s ever shown up.

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Name Nationality Timing Marathon Year

Dennis Kimetto Kenya 2:02:57 Berlin 2014

Wilson Kipsang Kenya 2:03:23 Berlin 2013

Patrick Makau Kenya 2:03:38 Berlin 2011

Haile Gebrselassie Ethiopia 2:03:59 Berlin 2008

Haile Gebrselassie Ethiopia 2:04:13 Berlin 2007

Paul Tergat Kenya 2:04:55 Berlin 2003

Khalid Kannouchi United States 2:05:38 London 2002

Khalid Kannouchi Morocco 2:05:42 Chicago 2008

Ronaldo Da Costa Brazil 2:06:05 Berlin 1999

Belanyeh Dinsamo Ethiopia 2:06:50 Rotterdam 1998

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1.59.59

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Asphalt surface, Formula 1 Track near Milan

Ideal Temperature 54 Degrees Fahrenheit

New shoe makes runners 4 percent more

efficient

63 year anniversary

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GE looked beyond its direct competition and industry to adopt

digital innovations and transformed itself

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• Industrial IoT platform for

predictive analytics solutions

• Predict when you need to

perform maintenance or

replace parts for locomotives

• GE using 3D-printing to make

parts for its new Leap Engine.

(GE’s bestselling jet engine)

• Result: 19 parts now produced

in 1 print; 5 times stronger

Source: Frost & Sullivan

• GE is working on ‘the digital

windfarm’, built on the Predix

platform

• They estimate that the

technology could boost a wind

farm’s energy production by

as much as 20%

Caterpillar – Bringing all its machines online into the age of

‘Smart Iron’

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Connected machines such as bulldozers and hydraulic

shovels

Predictive diagnostic tools: Using the mountains of data

spewing from these machines and turning it into

meaningful information

Help Caterpillar's customers catch potential maintenance

issues before breakdowns occur, minimizing downtime

Disney transformed digitally with MyMagic+

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Disney invested in MyMagic+ to improve Disney

World’s customer experience

MyMagic+ consists of a website, mobile app and

digital wristband that allows Disney to track and

analyse customer behaviour

Disney uses this data to create a personalized and

seamless Disney World experience for their

customers

Government driving the ‘e-ecosytem’

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Powering Ujjwala Yojana, India's Gas Subsidy

for 50m Women

Finding

locations

for the best

10,000 LPG

Centers

Tracking

27 million

applications

Ensuring new

connections

are installed

safely

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INTERNAL SALES DATA FROM 3 Oil Marketing

Companies was CONNECTED

EXTERNAL DATA FROM 640,000 villages and 600

public data sources were ACCESSED

NEW DATA about location coordinates of 17000

existing distributors was sourced via Android App

COLLECT DATA to open

the next 10000 LPG

(Gas) Centers

Every yellow dot

represents a village

in India

Every red dot represents an LPG Center

Implications on Security

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A paradigm shift in the boardroom & C-suite towards cyber security

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Cyber security = Ensuring the confidentiality, integrity and availability of data in cyberspace

What is means to business presently:

Security is for compliance

Security is a cost center

The new paradigm for the future:

Poor security is a business risk

Investing in security is a growth enabler

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Adopting Industrial IoT

platform for predictive

analytics

Enhance user experience using

mobile apps and digital

wristbands that to track and

analyse customer behaviour

Changing dynamics of

shopping using virtual

reality

Enhance logistics distribution

through location data collection

using mobile applications

The catalyst of digital transformation: applications

APP

Digital transformation enabled by applications

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Data manipulation Data breaches: Stealing of

customer records /

intellectual property

Denial of services Industry Espionage

Before going digital, do we really understand the cyber risks?

The implications of security for digital transformation

APP

Consumer Protection | Reduce Breach Impact

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Non-compliance: Penalized with a fine of up to AU$360,000 for individuals

and AU$1,800,000 million for organisations

Australia data breach notification act takes effect from 22nd Feb 2018

Possible impacts of a data breach notification / disclosure for the entity:

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Immediate inquiries and

publicity by the media

Perceived poor

security posture Surge of inquiries /

complains

Consumer trust

(customer churn) Impact on stock prices Possibly more

cyber attacks

Prevention of data breaches should be paramount

= avoid the need of data breach notification

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Proactive cyber security assessments / “cyber-health” checks

Security by design, review of security solutions and services

Development and testing incident response plans

Hiring, training, development and retention of cyber security professionals

A paradigm shift in the boardroom: “Cyber security as a business enabler”

Cyber

Security

Imperatives

for Digital

Transforma

tion

Recommendations – extending the security paradigm “further”

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Security by

Design

Real-time

Detection

Scope and

Quarantine

Signature-less

prevention

Artificial

Intelligence

Patch

Management

Secure Coding

Assessing the

Unknown

Threat Intelligence

and Correlation

Deep Web

Surveillance

Deceptive Security

Threat Hunting

Retrograde

Detection

Distributed

Forensics

Automated Policy

Enhancement

Threat Eradication

Incident Response

Evaluate and

Benchmark

Security risk

evaluation and

scoring

Single Pane of

Discovery

Management

Reporting

Prevent Detect Remediate Predict Measure

Thank You

mmenon@frost.com

mmenon@frost.com

Twitter: menon_manoj