Executive Summary
Accenture Technology Vision 2013
Every Business Is a Digital Business
Executive Summary
Every Business Is a Digital Business
Technology is now intertwined with nearly every aspect of business. Information technology is not only pervasive; it is fast becoming a primary driver of market differentiation, business growth, and profitability. Software is absolutely integral to how we currently run our businesses as well as how we reimagine our businesses as the world continues to changehow we redesign and produce things, how we create and manage new commercial transactions, how we begin to collaborate at unprecedented levels internally and with customers and suppliers. In the new world, our digital efforts will be key to how we innovate and expand our business.
That is why Accenture believes that understanding technology changethe trends that impact your businessis no longer just the realm of IT. It is time for every executiveCOO, CMO, and even CEOto grasp its importance and use technology to pursue success. This years Accenture Technology Vision lays out the major technology trends affecting organizations in the public and private sectors. Accenture contends that, today, Every Business Is a Digital Business. While simple, this proposition signals a large transformational shift not just in the role of technology but also in the very business models that underpin success. In many ways, this Technology Vision is a forecast not only for technology but for business as a whole. There is a higher order of thinkinga digital mindsetthat will, we believe, separate tomorrows most able organizations from their lesser rivals. At the very least, it is necessary in order to anticipate and respond to ongoing technology-driven disruptions. Ideally, a digital mindset will enable enterprises to launch preemptive strikes of their own. Accenture argues that now is the time to act. Mobile, cloud, social, virtualization, big datamany of the items continuously listed as hot trendsare well past the point where they should be areas of exploration and experimentation and are
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quickly becoming the practical, available tools with which companies can craft fast, cost-effective solutions to some of their toughest problemsand greatest opportunities. Accenture observes that increasing numbers of farsighted organizations are recognizing IT as a strategic asset with which they can renew vital aspects of their operationsoptimizing at least and innovating at best. Recognizing that data is key to releasing ITs strategic value, they are investing in the digital tools, the capabilities, and the skills to more easily identify useful data, evaluate it, analyze it, derive insights from it, share it, manage it, comment on it, report on it, and, most importantly, act on it. These companies, and many more like them, clearly see digital as a strategic imperativea tool for competitive differentiation. They arent waiting for new technologies to be developed or to mature before they act. It is incumbent upon the executive leadership team to be stewards of this new mindset. They must recognize that its no longer possible to separate the technology from the business; the two are intertwined. An organization cannot be its best unless it excels at understanding and using technology. This is the essence of the digital business.
Accenture Technology Vision 2013
Seven Technology Trends
largely to create yet more detailed views of consumers, consumer attributes, and transactions rather than using the new digital connections to improve the ways in which they interact with those consumers as individuals. Taken in aggregate, digital represents a key new approach to consumer engagement and loyalty: it gives businesses rich channels through which to communicate with consumers in much more personal ways, enabling them to manage relationships with consumers at scale. Digital brings the intimacy of the corner store relationship to all your consumers, and then gives them moremore convenient access, more effective communication, more tailored services that matter. Farsighted organizations see this as a huge opportunity to drive revenue growth. Specifically, they are customizing the experience for every interaction they have with consumers regardless of channel. This mass personalization includes not only the interactions between company and consumer but the interactions that consumers have with one another. The potential payoff is two-pronged: customer relationships that your competitors dont have and a strongly differentiated brand.
Relationships at Scale: Moving beyond transactions to digital relationships
Its time for businesses to turn their attention back to their relationships with consumers. Specifically, they need to rethink their digital strategies to move beyond e-commerce and marketing and strive for the kinds of personal relationships that were typical years ago, between shoppers and the corner store. The key factor is that technology is finally at a point where buyers can be treated like individuals again. Consumers are more than faceless digital transactions, more than a cookie file or a transaction history or a demographic profile; theyre real people with real differences. Yet the tendency of many companies has been to use mobile technology, social networks, and context-based services
Executive Summary
Design for Analytics: Formulate the questions, and design for the answers
Companies no longer suffer from a lack of data; they suffer from a lack of the right data. As such, they have to rethink how they design software in the future, going beyond basic application functionality to design in ways to elicit data-rich answers that specifically answer the enterprises key business questions. The IT world we live in today revolves around software applications. Businesses have developed data models to support functionality; as a result, applications often dont gather data required to support new business imperatives. Most companies have also taken the next stepfor example, they recognize that information is valuable for future insight, so they capture more of it where they can. But more data doesnt equal better data. Generally, companies are capturing this data without specific questions in mind. So, when data are repurposed as inputs for strategic decisionssuch as entering a new market or pricing a new serviceglaring information gaps often arise. With every data gap, enterprises miss an opportunity to make better decisions. Plugging these data gapsgetting the right datarequires a fundamental shift
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in how applications are built, configured, instrumented, and updated. While applications still must meet functionality needs, they must also be designed to deliver data that answers more of an enterprises questions. Sensors will help enterprises plug further data gaps creating and collecting information from physical environments and devices. Technology is no longer the barrier.The barrier is the strategic foresight to formulate the right questions in the first place. To get the right data, its necessary to add data collection as a new set of requirements within the development process. These capabilities become part of the upfront processes for how you lay out road maps for your systemsnot something added after the fact. The result is the first stage of a data supply chain, where applications serve not only users but also the business as it looks for answers to its most important questions.
generate actionable insights, the organization misses out on the potential business advantage from that insight. More worrisome, if the business hasnt begun using data-driven insight to detect and evaluate opportunities in the first place, it runs real risks of falling behind. To date, business leaders have been bombarded with statistics about the soaring volumes and incredible variety of data that they can mine for precious insights. But they need to pay attention to data velocitythe pace with which data can be gathered, sorted, and analyzed in order to produce insights that managers can act on quickly. As expectations of near-instant responses become the norm, business leaders will rely heavily on higher data velocities to gain a competitive edge. Whats happening now is a surge of new technologies that help to accelerate the whole data cycle from insight to action, increasing the enterprises ability to deal with data velocity. According to Gartner, the adoption of in-memory computing is expected to increase threefold by 2015.1 Newer low-cost analytical packages decrease the time needed for problemdriven exploration. Even new big data technologies designed to handle large volumes of unstructured datalargely batch technologiesare being adapted to work in real time, or as close as possible to real time. In all of these discussions about data velocity, the point is not to strive for some real-time nirvana. Whats crucial is an improving rate of response, regardless of the rising volumes of data to be accessed and analyzed and irrespective of their proliferating sources. Going forward, it will no longer be about the size of your datait will be about matching the velocity of your data to the pace at which your business processes need to act on it.
Data Velocity: Matching the speed of decision to the speed of action
Today, its increasingly important to match the speed of the organizations actions to the speed of its opportunities. If too much time elapses between the acquisition of data and the ability to use the data to
Accenture Technology Vision 2013
doing. They need to use collaboration and social channels in such a way that they have the potential to create specific, measurable productivity gains. The real productivity gains from these technologies will stem from a companys ability to integrate the social technologies into its business processes and the software that supports them.
Seamless Collaboration: Right channel, right worker, right job
Its time for the enterprise to reimagine the way its employees work. The rise in social networking has breathed new life into collaboration. Users new social behavior and growing expectation that every app will be social are pushing companies to create new user experiences. However, to increase productivity, enterprises must move beyond standalone social and collaboration channels; they must begin to directly embed such channels into their core business processes. The new approach: build social, collaborative applications throughout the enterprise. For the most part, enterprise collaboration today is still a set of siloed communication channels, from e-mail to videoconference to social-activity streams (basically a timeline of activity, similar to whats on a Facebook page). Users are expected to figure out by themselves how to use those channels to do their job and improve their productivity. But employees dont necessarily need to become more social for collaboration to work. The work and the process are what need to be social and when that happens, it will transform the nature of work. To properly harness the power of social technology for collaboration, companies need to go beyond what social sites are
Companies cannot wait for software vendors to build bolt-on solutions to address strategic needs. It is their job to actively identify the core processes where improving productivity will drive the most value and then to weave in the tools, putting collaboration back into work.
With virtualization investments already paying off in servers and starting to pay off in storage, businesses will turn their attention to virtualizing the network in order to extend the life of their infrastructure and reap the full value of their virtualization investments. Like other virtualization technologies, SDN has the ability to radically change the flexibility with which businesses and IT operate. With SDN, businesses can finally realize the vision of a dynamic enterprise, deploying new projects quickly and determining just as quickly whether they are successful or not. Enterprises are halfway toward this goal of agilitythey currently use virtualization to spin up servers and storage without having to procure more hardware, and then spin them down again when projects end or fail to meet expectations. SDN involves decoupling hardware from software for a higher degree of flexibility. By uncoupling the hardware, SDN essentially eliminates the need for applications to understand the internal workings of the routers and switches that connect multiple networks. Software, not hardware, creates the connections that stitch together multiple networks. Suddenly, companies can reconfigure the connectivity of systems without changing their physical characteristics.
Software-Defined Networking: Virtualizations last mile
Software-defined networking (SDN) is a radical new way of looking at the network. In a world that demands constant change, SDN enables IT to unleash the power of virtualization and makes it easier to move to the cloud. To the business, SDN is a key technology for delivering flexibility and agilityvital components in differentiating the company. Put simply, SDN makes it easier for enterprises to handle change, and change is an imperative for a digital business.
Executive Summary
between their practices and current best practicesundertaking regular actions such as deploying reflex-like responses to security threats in their midst and leveraging analytics to create second lines of defense around data and services. On top of that, their IT leaders need to stay alert for the next round of advancements, to help prepare more creative and more agile responses and to get more insight into attack profiles. Some of the focus is shifting from studying your systems to studying the people using themthat is, getting to know your intended users and your hackers alike. In parallel, there is intense activityand plenty of investmentgoing into active defense; that is, into systems that actually engage the enemy with the objectives of making it more difficult, more expensive, and less profitable for hackers to do their work. The systems being developed range from technologies that signal to the intruder that he is being tracked to others that deceive him with electronic pollutioncyber smokescreens, if you like. With the average organizational cost per data breach in the United States at more than $5 million, emerging active-defense technologies help companies know their enemy, and prevent enemies from knowing you.2 The security burden is not ITs alone. The risks incurred are business risksthe harm to intellectual capital when sensitive data is compromised, the operational risk when business is disrupted, the reputation risk when personally identifiable consumer information is stolen, and of course the increasing likelihood of hefty penalties when data security regulations are violated. To protect the digital business, business leaders must get involved in IT security too.
Active Defense: Adapting cyberdefenses to the threat
When it comes to data security, cybersecurity, network securityjust about any kind of corporate information securitymany enterprises can do far more to address the risks that their organizations face. Although most have invested substantially in IT security, they are still not taking full advantage of the maturing tools and services available to help blunt todays attacks and plug the many entry points that skilled attackers can now exploit. Essentially, enterprises default mode is perimeter protection when it should be proactive probing, and isolationism when it should be integration. Compliance has become their comfort zone. Meanwhile, information security concerns grow by the day: IT attack surfaces keep widening across more devices, more systems, more people, more partners, and broader infrastructure. Cloud and mobility have created new places for hackers to probe. Targeted forms of cybercrime are raising threat levels. And legacy systems that were never designed for a connected world have been brought online, opening up further weak points. Enterprises must begin to expect that 3 a.m. call about a security breach. They have to close the widening gap
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Beyond the Cloud: The value lies in putting the cloud to work
Its easy to see why so many IT leaders are hesitant about cloud computing. Its daunting enough to figure out the vagaries of private cloud versus public cloud without delving into who manages what data where, whos responsible for security, how cloud deployments affect network infrastructure, and more. Cloud is no longer an emerging trend, nor is it a single concept. It can and does have a transformational impact across the business. The key question is not should we use cloud? but how can we use cloud? Leading organizations already sense that theyre still only at the beginning of what they can do with cloudand what it can do for them. Accentures latest research shows that more than one-third of large enterprises have yet to implement any form of cloud infrastructure. For platform cloud technologies, that percentage jumps to one-half. The encouraging part is in applications. Of large enterprises, 43 percent are at least piloting SaaS, with nearly half of those committing a large percentage of their business to it.3 Enterprises must view cloud as an overarching approach that considers the value of SaaS, PaaS, IaaS, and other as-aservice technologies, and helps determine
Accenture Technology Vision 2013
how they can best become a part of ITs current toolbox. Companies will create hybrid capabilities that combine the best of all clouds elements, mixing on-premise and off-premise IT and integrating cloud with legacy systems and traditional software. The technology is here, so the conversations should now turn to how these tools can be used to differentiate a companys business, helping it get to market faster and respond more flexibly to opportunities and obstacles. Capitalizing on the technology means redefining an enterprises approaches to skills, architecture, governance, security, and more, and the time to begin is now. By harnessing cloud skillfully, companies can enter whole new businesses or launch new products in short order. As an integral part of their IT strategies, cloud can make their businesses more responsive, more flexible, more scalable more competitive. The point should not be cloud itselfthe point, instead, is how cloud is embedded in your technology landscape and in your business, in ways that provide strong differentiation in the marketplace.
Notes
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Predicts 2013: In-Memory Computing: Growing Gains, but Also Growing Pains, Gartner, November 30, 2012. 2011 Cost of Data Breach: United States, Ponemon Institute, March 5, 2012. http://www.ponemon.org/ library/2011-cost-of-data-breach-unitedstates Accenture High Performance IT Survey Round 4, Preliminary Findings (N=187), 2013. (Survey demographics: 187 CIOs at global large enterprises.)
For more information
www.accenture.com/technologyvision Paul Daugherty Chief Technology Officer
[email protected] Michael J. Biltz Director, Accenture Technology Vision
[email protected] Scott W. Kurth Director, Accenture Technology Vision
[email protected]About Accenture
Accenture is a global management consulting, technology services and outsourcing company, with approximately 259,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the worlds most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$27.9 billion for the fiscal year ended Aug. 31, 2012. Its home page is www.accenture.com.
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