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INSIGHT: HUMANS, MACHINES AND THE RISE OF ARTIFICIAL INTELLIGENCE

May 2018

VIDEO INTERVIEW

TOP 10

CPO, KAI NOWOSEL, ON CHANGING THE FACE OF PROCUREMENT

BLOCKCHAIN PLATFORMS

POWERING PROFITABILITY INTO

A N E XCLUS IVE IN TE R VIE W W IT H RO DRIGO BEC ERRA MIZU NO , C O R P OR ATE DIR E CTOR A ND C IO O F MEXIC O ’S LA RGEST E CON O MIC C O NT RIBU T O R


SAVE THE DATE FOR THE GLOBAL TECH CONFERENCE

15 & 16 MAY 2018 LUXEMBOURG

FINTECH

DIGITALIZATION

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FOREWORD PEMEX, THE BIGGEST company in Mexico, feature as the cover story in May’s issue of Gigabit Magazine. Tom Wadlow put questions to Rodrigo Becerra Mizuno, the oil and gas giant’s Chief Information Officer, on how its technology transformation is helping drive efficiency, profitability and long-term survival in a newly-competitive market. “I thought this would be the biggest professional challenge of my career,” he recalls, “so when CEO at the time invited me, I was extremely excited. I knew technology would be at the forefront of this transformation.” Delve deeper into our newest edition and you will find an exclusive interview with Kalyan Kumar, CVP and CTO IT Services at HCL Technologies, and some fascinating insight on data analytics from Didici founder Tony Brookes and his right-hand man Tim Ogle. Complementing our latest analyses in the field of artificial intelligence and cloud computing, we bring you the Top 10 blockchain companies based on market capitalisation, a list profiling the likes of Ripple and Ethereum. Finally, our exclusive digital reports feature interviews with, on top of Pemex, Accenture, Keppel Data Centre, McDonald’s, Odense Letbane, Virgin Money, Yandex, Atlantis The Palm, United Arab Bank, Yatra and Daimler Trucks Asia – all involving in-depth discussions with top executives and industry experts. We hope you enjoy this latest issue and, if you have any feedback, you can find us across social media: Gigabit’s Linkedin group, or follow us on Twitter and Facebook.

Enjoy the issue!

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P8

Powering Pemex into profitability


TOP 10

BLOCKCHAIN

ASIA

PLATFORMS

Pemex Mondelez International Yatra Online Pvt Ltd Daimler

USA

P72

SAP Ariba Hypower MANN + HUMMEL

CANADA

Events P82

Yamana Gold

EUROPE Accenture

P30

Keppel Data Centre McDonald’s Odense Letbane

Humans, machines and

THE RISE OF AI

Yandex oy Virgin Money Turkcell

MIDDLE EAST United Arab Bank Atlantis The Palm

P62 How to make your

business GDPR ready

Data for the non-data P40 scientist

The virtual desktop P50


POWERING DATA-DRIVEN DIGITAL TRANSFORMATION IN MANUFACTURING Hewlett Packard Enterprise’s (HPE) Hybrid IT technology is enabling original equipment manufacturers (OEMs) such as GE Digital enter a world powered by Internet of Things (IoT) connectivity and data analytics – where nothing ever breaks. These benefits are being passed on to customers, allowing them to adopt new business models, streamline operational processes and create more innovative products and services. Hewlett Packard Enterprise’s (HPE) Hybrid IT technology is enabling original equipment manufacturers (OEMs) such as GE Digital enter a world powered by Internet of Things (IoT) connectivity and data analytics – where nothing ever breaks. These benefits are being passed on to customers, allowing them to adopt new business models, streamline operational processes and create more innovative products and services.

CHALLENGE For OEMs, the current idea economy is all about turning ideas into value faster than the competition. With the vast amounts of data gathered from a growing number of IoT endpoints, manufacturers can drive operational efficiencies, deliver better user experiences, and develop new capabilities. However, while leveraging technology to improve performance is critical to remaining successful, it’s not as easy as it sounds. This is due to a variety of factors, including: • Bespoke systems: Many existing industrial systems are purpose-built, with distinct protocols and limited capabilities. However, right now, what companies need are cross-platform visibility and insights. • Implementation difficulties: The lack of mature skills and resources for IoT implementation means that the integration of information technology (IT) and operational technology (OT) has become essential in driving productivity and business results. • Alignment between IT and operations: The financial risk and uncertainty resulting from IoT adoption has driven companies to use a mix of SaaS, Hybrid and Cloud-first strategies, which must now be connected to each other.

SOLUTION To combat these challenges, HPE OEM has built hybrid IT solutions that include pioneering edge computing and analytic data techniques, to help manufacturers turn vast quantities data into real-time, actionable insights. These solutions have been designed to adapt to a variety of business challenges. For example, GE Digital harnessed them to create Predix – the operating system for the Industrial Internet – to drive its own business transformation, as well as that of other manufacturers. As the world’s first and only industrial cloud platform, GE Predix is turning data into actionable insights from the edge to the cloud, and employing the latest innovations to optimize assets and operations – all supported by a robust ecosystem that accelerates app development. With the HPE-powered Predix, manufacturers can leverage big data and analytics in conjunction with industrial expertise to achieve real gains in productivity,

BENEFITS The partnership between HPE OEM and GE Digital is helping national electric utility company Saudi Electricity achieve an ambitious modernization of Saudi Arabia’s electricity infrastructure. Working with the HPE OEM and GE Digital Alliance, Saudi Electricity implemented an industry-leading Industrial IoT platform that supports machine learning and predictive maintenance technologies. This allows them to improve the company’s quality of service while minimizing energy costs. By 2020, Saudi Electricity expects to this continuing partnership to yield a $19B reduction in operational and capital costs, 3x increase in power generation capacity and improved reliability, and 100% control of critical electrical assets. Ultimately, companies seeking to thrive in the idea economy must implement data-driven digital transformation Ul practices. By identifying problems before they occur, manufacturers will derive improved quality, reduced production time and machine downtime, and lower production costs – and then pass these benefits on to the customer. The collaboration between HPE OEM and GE Digital is a powerful example of how hybrid IT platforms are giving manufacturers real-time visibility across heterogeneous systems, putting them in a safe and secure environment that enables decisions to be made quickly, accurately, and intelligently.


POWERING PEMEX INTO PROFITABILITY Written by Tom Wadlow Produced by James Pepper


RODRIGO BECERRA MIZUNO, CORPORATE DIRECTOR AND CIO AT MEXICO’S LARGEST ECONOMIC CONTRIBUTOR, REVEALS HOW TECHNOLOGY IS PLAYING A CENTRAL ROLE IN THE IMPLEMENTATION OF THE OIL AND GAS COMPANY’S 2017-2021 BUSINESS PLAN


RODRIGO BECERRA MIZUNO, CORPORATE DIRECTOR AND CIO AT MEXICO’S LARGEST ECONOMIC CONTRIBUTOR, REVEALS HOW TECHNOLOGY IS PLAYING A CENTRAL ROLE IN THE IMPLEMENTATION OF THE OIL AND GAS COMPANY’S 2017-2021 BUSINESS PLAN

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n 20 December 2013, Mexico’s oil and gas industry entered a new age. Having operated under a monopolised umbrella for 75 years, President Enrique Peña Nieto signed a momentous energy reform bill which opened up the country’s largest revenue-generating Technology to private competition. For national oil and gas giant Petróleos Mexicanos (Pemex), this signalled a huge about-turn, an overnight change of course not witnessed since its formation in 1938. A massive transformation was required, from a company operating as a monopoly to one that can stand up to competitors. Once charged with delivering hydrocarbon energy across the whole of Mexico at whatever the cost, Pemex is now focused on efficiency, profitability

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and long-term survival. It was the enormity of this challenge which lured Corporate Director and CIO Rodrigo Becerra Mizuno away from a decade of servitude at Microsoft. “I thought this would be the biggest professional challenge of my career,” he recalls, “so when CEO at the time Jose Antonio González Anaya invited me, I was extremely excited. I knew technology would be at the forefront of this transformation. “On top of this, Pemex is the largest company in Mexico and one of the largest in the world.” The numbers back this up. As the eighth largest oil producer and drilling company in the world, Pemex’s $52bn revenue is equivalent to the entire GDP of Uruguay. It generates 2.5mn barrels of oil and 6mn cubic feet of natural gas a day,


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PEMEX IS THE LARGEST COMPANY IN MEXICO AND IN THE TOP 100 LARGEST COMPANIES IN THE WORLD. HERE ARE SOME OF THE NUMBERS THAT MATTER

>$52BN

ANNUAL REVENUE

70+

NUMBER OF DIFFERENT PRODUCTS SOLD

delivering this to over 11,000 service stations in Mexico and abroad via 83 land and sea terminals. From exploration, production and refining to logistics and marketing, Pemex covers the entire value chain. Technology and the road to profit While the enormity and scope of operations no doubt presents a competitive advantage over new entrants to the market, it exemplifies

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2.5MN

NUMBER OF BARRELS OF OIL PRODUCED A DAY

6

NUMBER OF PEMEX REFINERIES

the challenge Becerra Mizuno and the Pemex leadership are facing. The 56-page 2017-2021 Business Plan signposts Pemex’s road to profitability, and notably sets a target to achieve financial balance in 2019/2020. Technology will be crucial to realising this ambition. “If certain markets we are serving are not profitable, we don’t have to operate in them anymore,” Becerra


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NUMBER OF PEMEX GAS PROCESSING PLANTS

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NUMBER OF PEMEX PETROCHEMICAL FACILITIES

Mizuno says. “In that case, we have to make better decisions with the information or the data that we have. That’s where technology plays a major role, because it can streamline our operations and create a better more profitable and safer environment.” Brief set, what did the technology landscape look like when Becerra Mizuno arrived in September 2016?

“I found that Pemex had a large amount of technology infrastructure. They own it, they develop it, they construct it, they deploy it. Everything was done in-house. I said to myself, we need to change.” Much of this sprawling infrastructure owes its existence to a self-built telco network, the second private largest in the whole country, which includes 130,000 phone lines and 10 data centres. Pemex was founded nine years before Mexico’s national telecoms company Telmex, and hence had to build its own communications capability from scratch. There was a time when people who worked for Pemex had two telephones at home: one from Pemex and the other one from Telmex. “They got used to building their own technology infrastructure from the bottom up,” Becerra Mizuno says, “and they used to do it extremely well. But the world changed, and there are people that can do it better, because they specialise on that.” Privatisation of these telco assets has proven vital in simplifying

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PEMEX’S PARTNER IN DIGITAL TRANSFORMATION Huawei is a leading global Information and Communications Technology solutions provider. Our industry-leading products and solutions have been deployed in more than 170 countries. In the 2017 Global Fortune 500 list, we ranked 83rd, thanks to our customer-centric vision and yearly investment in R&D (at least 10 percent of revenue). Huawei has delivered services to 70 percent of the world’s top 20 oil and gas companies. Mexico and Spain are prime examples. Mexico — Pemex, the largest company in Mexico, dedicated to petroleum and petrochemicals, is undergoing a major Digital Transformation project, expected to be the largest of its kind in the Latin America O&G Industry. Huawei helps Pemex ICT transformation by successfully deploying Agile Campus and IMS(IP Multimedia System) solution. Based on integrated networking and collaboration solution, more than 60,000 employees distributed in 13 branches enjoy ultimate experience. Huawei 8-inch HD video phone provides easy and secure collaboration, Agile campus switch makes network intelligent and smoothly evolution for future. At the same time, Huawei unified solution accelerates and simplifies Pemex network operations, improve O&M efficiency by 50 percent. Spain — CEPSA, one of the leading energy companies in Spain, has to process massive amounts of data during crude oil exploration and production, therefore, there is a need for an effective data analysis solution in order to improve exploration and production efficiency. As CEPSA’s business grew rapidly, traditional databases failed to meet ERP system requirements and were holding back business development. Additionally, traditional servers and storage require high maintenance skills. CEPSA was looking for a cost-effective solution that could be flexibly expanded. Huawei provided solutions for CEPSA, including mission-critical servers, storage, switches to build a reliable and stable new-generation database system. Huawei servers greatly enhance CEPSA’s ERP system performance, which has led to an improvement in production efficiency. CEPSA’s financial analysis system has doubled the number of transactions it can process, meeting strict service requirements.

Huawei servers achieve a failure rate 15% lower than industry average, guaranteeing that the system runs reliably. Huawei uses industry standard components, greatly reducing costs for procurement and future capacity expansion.

Huawei cooperates closely with top global partners in the oil and gas industry. In oil and gas industry, we focus on digital pipeline, oil and gas IoT, High-Performance Computing (HPC), and operations management application platforms. Huawei is committed to providing one-stop ICT infrastructure solutions. Meanwhile, we have established an open, diversified, and win-win ecosystem. These include underlying automation enterprises, upper-layer application providers, and oil and gas engineering design enterprises worldwide. • Huawei’s server and Schlumberger’s reservoir analysis software have completed integration and admission testing • Huawei and Honeywell have jointly developed and officially released a wireless gas detection solution based on Huawei eLTE • Huawei and PCICT, a branch of Sinopec, together have developed a smart engineering solution for oil refining

Huawei is commited to being Pemex’s best partner in its digital transformation. Huawei is dedicated to building innovative infrastructure platforms for enterprise digital transformation by making optimal use of emerging technologies, such as cloud computing, SDN, Big Data, and the IoT. Also, by working closely with skilled partners, Huawei helps enterprises attain their goals of agile, intelligent digital upgrades. To date, 197 companies in Fortune’s Global 500, 45 of which are in the top 100, have selected Huawei as their partner for digital transformation. Huawei looks forward to implementing digital transformation with you and creating a fully connected and intelligent world.


PEMEX

“I FOUND THAT PEMEX HAD A LARGE AMOUNT OF TECHNOLOGY INFRASTRUCTURE. THEY OWN IT, THEY DEVELOP IT, THEY CONSTRUCT IT, THEY DEPLOY IT. EVERYTHING WAS DONE IN-HOUSE. I SAID TO MYSELF, WE NEED TO CHANGE” - Rodrigo Becerra Mizuno, Corporate Director and CIO

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Pemex’s technological landscape, which Becerra Mizuno stresses needed streamlining with a degree of urgency. “We needed to kickstart this immediately because we are working on the political clock, so we had to hit the ground running.” Becerra Mizuno is referring to upcoming presidential elections which, depending on the result, could signal further reform at Pemex. The need to demonstrate the viability of the 2017-2021 Business Plan to any incumbent administration, and indeed the Mexican public, is therefore paramount.

THE GREAT ENABLER Tangible progress has already been made. According to Becerra Mizuno, $50mn of savings have already been realised through strategic moves such as telco asset stripping, and by the end of the year Pemex will be relieved of its data centre management burden, instead operating on a hybrid cloud model and paying on demand for what it uses. Becerra Mizuno also points to a shift in spending priorities. “When

I arrived, our budget was 90% focused on investment, 10% on operational excellence. That means that 90% of things we did here with our budget was purchasing, which is how we arrived at this point where we have amassed a large amount of infrastructure.” “This year, we’re shifting that mix to 70% opex, 30% capex. We’re still not done, but we have changed the way we’re doing business now. We’re hiring service, not buying it.” The CIO points to the influence of both CEOs he has worked under – Jose Antonio González Anaya and now Carlos Treviño Medina. Without their leadership, much of this change would not have materialised. This shift in priorities is better demonstrated by the recent Pemex Drive event, which invited key industry stakeholders to learn about the company’s new technologydriven strategy. “We also wanted to create excitement around the company, which had been lost. It’s only now been revived by this and many other factors as well, including the efforts of the CEO.”

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Automation and the Industrial Internet of Things

Why is is everyone everyone talking talking about about it? it? Why Improved sensing technologies Cost-effective, secure connectivity Advanced computing and analytical methods

Leveraging decades of digital automation expertise, Emerson introduces the expanded Plantweb digital ecosystem, a scalable portfolio of standards-based hardware, software, intelligent devices and services for securely implementing the Industrial Internet of Things (IoT) with measurable business performance improvement. Plantweb becomes the most comprehensive and integrated Industrial IoT portfolio in the industry.

@EMR_Auto_Latam @EmersonAutomationLatam


IIoT, the key to achieve a Top Quartile Performance in the oil and gas industry Oil and gas companies strive to meet business and performance goals. Constantly changing market dynamics and operational challenges can make it difficult. Whether you are producing from a conventional or unconventional field, key challenges like reducing operating costs, minimizing HSE risks, and maximizing production are paramount. For decades, the industry has primarily used closed, private networks to control critical plant functions, or Operational Technology (OT). But in recent years, oil and gas companies have been among the first to explore Internet of Things (IoT) applications that enable more widespread and cost-effective monitoring and control of facilities, along with reduced costs and increased flexibility. Companies are dramatically improving the speed and accuracy of decision-making based on having the right information in the hands of the right expert, no matter where they sit. The Industrial Internet of Things (IIoT) is ushering in a digital transformation that enables companies to exploit technology and expertise better than ever before, but only if the right scalable technology strategy is matched to your business goals. The digital era is a reality for oil and gas leaders like Pemex, where state-of-the-art technology will bring about important operating improvements and increase productivity throughout the company’s value chain. Digital transformation has become a fundamental tool to bring about a change that will lead the company towards modernity and that will help Pemex face the challenges of the new Mexican energy model. This digital transformation will add value to production, reduce the overall costs of production processes, and optimize and streamline logistics, in addition to increasing the operating security of the company. This is why Emerson introduces the extended the extended Plantweb Digital Ecosystem, a scalable portfolio of standardsbased hardware, software, intelligent devices and services for securely implementing the Industrial Internet of Things (IIoT) with measurable business performance improvement. Plantweb Digital Ecosystem harnesses the power of Industrial IoT to expand digital intelligence to the entire manufacturing enterprise, while also providing an architecture for on-premise applications. Plantweb provides a comprehensive framework to help manufacturers achieve Top Quartile performance in the areas of safety, reliability, production and energy. Top Quartile is defined as achieving operations and capital performance in the top 25 percent of peer companies. In addition to highly secure process control, safety and asset management systems, Plantweb supports enterprise-wide operations with an expanded portfolio of Pervasive Sensing field instruments, the Secure First Mile family of software, gateways, security devices and services, the Plantweb Insight™ and Plantweb Advisor™ scalable suite of software applications, the Plantweb Optics™ Platform, and Microsoftenabled, cloud-based remote expert Connected Services.

Pervasive Sensing expands the industry’s largest portfolio of measurement and analytical technologies. Secure First Mile is a security architecture that allows customers to selectively connect highly secure data from protected control and operation systems (OT) to operational performance applications in the cloud environment (IT). Plantweb Insight Software provides a comprehensive, lightweight portfolio of IT-friendly applications with analytics for monitoring asset health which can run independently of existing business systems and distributed control systems (DCS) and provide a simple and powerful entry point to Industrial IoT. Plantweb Advisor Software is a robust suite of integrated analytical expert applications for asset health, performance modeling and facility-wide energy optimization. The widely adopted OSIsoft PI System’s highly scalable open data infrastructure is used as a platform for these applications. Plantweb Optics is a mobile-ready collaboration software platform that provides cross-functional collaboration and decisionmaking to help plants operate safely and profitably. Lastly, Connected Services is an Industrial IoT-enabled cloud services offering for real-time monitoring of important assets’ health, energy consumption and other operational applications. But the Industrial IoT is not only transforming the way information is conducted across the company to improve decision making. Industry is at a critical inflection point where efficiency-focused operational improvement programs have reached a point of diminishing returns, and personnel are being strained to achieve more with less than ever before. In the next era of manufacturing, Top Quartile performers will embrace digital transformation through the Industrial Internet of Things (IIoT) to accelerate, institutionalize, and sustain best-in-class behaviors across their workforces. The Emerson Digital Workforce Experience, is an immersive experiential environment that transforms, via Industrial IoT, the nature of work and improves workers’ lives through real-life work scenarios in five key industrial areas: project engineering, commissioning, control and simulation, maintenance, and reliability. The Digital Workforce Experience empowers workers to transform traditional behaviors and deliver value in fundamentally new ways by adopting innovative approaches enabled by Emerson’s Plantweb digital ecosystem. In summary, the potential of the Industrial Internet of Things (IIoT) is bound only by the limits of our creativity. But its realization will forever be tied to security. This trend is already playing out among early Industrial IoT adopters in the oil and gas industry, where there is tremendous motivation to adopt networked technologies and smart sensors. Many oil and gas facilities, especially offshore platforms, are located in dirty, distant, dull and dangerous environments. In these harsh areas, automation and remote management can increase efficiency, improve performance, and enhance profitability. But most importantly, they keep people out of harm’s way. TO LEARN MORE ABOUT EMERSON’S PLANTWEB DIGITAL ECOSYSTEM GO TO EMERSON.COM


PEMEX

POWERED BY PARTNERS Touting potential partners was also a key objective at Pemex Drive. Indeed, a major facet of the 2017-2021 Business Plan involves the creation of joint ventures along the company’s entire value chain as a mechanism to increase investment and efficiency. One example of this in action is a software factory developed with French consulting giant Capgemini. Based on mutual incentives such as delivering cost savings for one another, this initiative has already helped Pemex to begin cutting the sprawling number of costly applications embedded throughout

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its operations. By carefully identifying which processes could either be outsourced, merged or removed entirely, Becerra Mizuno hopes to cut 800 line of business applications down to 200-250, which even by his admission is still high. Accenture is another company helping Pemex to develop a digital ecosystem based on mutual benefit, while Microsoft and Emerson Work Services are helping deliver important work regarding migration of applications and processes to the cloud. Longstanding partnerships have also been redefined, such as the


ASIA

“WE’RE OPEN, WE’RE LOOKING FOR TALENT, WE’RE LOOKING FOR YOUNG PEOPLE, AND WE’RE GOING TO GIVE THEM THE OPPORTUNITY TO DEVELOP THEIR SKILLS”

one with SAP. Having utilised SAP’s oil and gas expertise for more than 50 years, Becerra Mizuno explains how this venture has evolved to provide all important flexibility to Pemex. “We have established a new partnership with them, where it’s not only them charging for their licenses or their service, but it’s also on a payas-you-use scheme on some of their modules, especially the oil and gas modules. Before, we had to pay for these no matter what, but we can now take into account peaks and troughs.” Becerra Mizuno further highlights an increasing number of pilot projects

- Rodrigo Becerra Mizuno, Corporate Director and CIO

being initiated with suppliers in a bid to uncover the next game-changing solution. Typically lasting eight to 12 weeks across all business units, these programmes are helping convert vendors and suppliers into true partners which build solutions tailored to Pemex’s priorities. “I’ll give you a small example,” Becerra Mizuno says. “In the refining process, one of the things that affects us the most is unprogrammed outages, because of the resultant

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maintenance. So, we’re working with Baker Hughes, part of GE, to create a pilot around these. The idea is that we can create savings, which will increase the value of the partnership to both parties. We’re not just buying sensors from them or their software, we’re doing things in a mutually beneficial way.”

CULTURE CATCHES UP Pemex is not just embracing innovation with its partners. Internally, something of a cultural revolution is underway. This is no minor undertaking for Becerra Mizuno, who is responsible for around 3,000 employees spanning engineers, consultants and decision makers, many of whom are from an older generation and more cautious about new technologies. “How do I get an aging work force to adopt new things?” he asks. “That’s usually very difficult. We have to see that becoming digital was largely about a new mindset. It’s a radical change in the way we do things – we’ve run a tonne of programmes to get people who have

not used technology to embrace it.” An initiative which has fostered innovation internally is Idea Lab, which allows employees at all levels to submit pitches in a venture capital style, progressing through various rounds until a winner is chosen and their idea funded. Harnessing innovation by attracting new talent is altogether a different challenge, especially when it comes to luring younger, techsavvy recruits into oil and gas. Partnerships with educational institutions like Mexico City’s Tec de Monterrey will help to bridge this gap. Pemex Drive was hosted on one of its campuses, and Becerra Mizuno says Pemex is working closely with the university to develop interest in oil and gas IT careers. He cites his own example of leaving a private technology giant for a public-Technology oil and gas firm. “When I was at Microsoft, it was an extremely optimised company, so the things that I was able to do were very narrow. They were perfect, but they were narrow. “At Pemex, there’s so much to do,

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PEMEX

“HOW DO I GET AN AGING WORK FORCE TO ADOPT NEW THINGS? THAT’S USUALLY VERY DIFFICULT. WE HAVE TO SEE THAT BECOMING DIGITAL WAS LARGELY ABOUT A NEW MINDSET. IT’S A RADICAL CHANGE IN THE WAY WE DO THINGS – WE’VE RUN A TONNE OF PROGRAMMES TO GET PEOPLE WHO HAVE NOT USED TECHNOLOGY TO EMBRACE IT” - Rodrigo Becerra Mizuno, Corporate Director and CIO

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PEMEX

and we need so much help. If you’re someone that is ambitious, that is young and can see the silver lining coming to work for us, it’s the perfect place. That story has not been told or communicated yet – we’re seen as a monolithic company and what we’re trying to show is a different kind of Pemex. We’re open, we’re looking for talent, we’re looking for young people, and we’re going to give them the opportunity to develop their skills.”

THE ROAD AHEAD Both from a cultural and implementation point of view, Pemex is beginning to make strides, evidenced by the fact that Becerra Mizuno has been recognised as a top 100 CIO in Mexico and a HITEC-50 2018 Award winner. “I think success is something that you share,” he says. “It’s something that you can’t do alone. I’m very fortunate to have the people that I have around me. The most important thing for me has been the support of the two CEOs that I’ve had the pleasure to work with. The current CEO Carlos Trevino is so open, so dynamic and

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so supportive of what we do. He is really the transformation CEO for us.” But what about the path in front of Pemex and Becerra Mizuno? For the CIO, three important targets and ambitions remain. “The first thing is to deliver the things that we said we would deliver. To make sure that we overdeliver what we have promised and that we meet the expectations that we have set for the team and for the technology department of Pemex. “The second thing for us is, as you know, we have a big transition coming with a new administration coming in December. I would love to see a lot of the building blocks and the strategies that we have implemented become lasting. Pemex is going in the right direction, which has been validated by many experts. “The third big piece is to make sure the people in the team continue to believe that there are good things coming ahead, that they continue to be motivated, so the momentum continues whether I’m here or not. That’s the most important thing for me.”


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D I G I TA L S T R AT E G Y

Humans, machines and

THE RISE OF A Kalyan Kumar, CVP and CTO IT Services at HCL Technologies, talks to Gigabit magazine about all things ‘augmented’ intelligence Writ ten by TO M WA D LOW


AI


D I G I TA L S T R AT E G Y

WHAT IS AI? A simple question at face value, but the source of ever-evolving answers and lively debate in academic, commercial and consumer circles. As AI has advanced, its meaning has splintered. First coined at a conference in New Hampshire, USA in 1956, artificial intelligence has generally carried a definition revolving around the simulation of intelligent behaviour by computers. However, that definition has shifted and spawned numerous subfields. “I don’t like the word ‘artificial’… I use ‘augmented’,” says Kalyan Kumar, CVP and CTO IT Services at HCL Technologies. “So, it’s all about augmented intelligence rather than artificial intelligence. You have to start to see it’s about human-machine partnership. It’s not human or the machine. It’s human and the machine.” What is widely accepted as fact is the way in which humans and machines interoperate is drastically impacting how we live and work. Unrelenting technology advancement is constantly changing the nature of 32

May 2018

“It's about human-machine partnership. It's not human or the machine. It's human and the machine” – Kalyan Kumar, CVP and CTO IT Services, HCL Technologies this interaction, meaning humans must continually adapt their own skills and intelligence if they are to keep up and reap the benefits. And this is where Kumar, his I love AI badge on display, dives deep into his passion for the subject. Sat in the Indian company’s London offices, he describes AI as he sees it. For him, its meaning has often been misconstrued – it is all about detail, and this needs breaking down into


different business functions in order to maximise its potential impact. “I strongly believe that there is nothing called general purpose AI, but rather AI for specific applications,” he explains. “Today, in every sphere of your life in the consumer technology world, you have AI. “For example, if you use an Amazon Alexa or a Google Home device, you have a piece of AI able to recognise natural language, and able to have a

conversation. So, the ability to find those right AI applications in the enterprise sphere is where I think the big business focus of AI is. “But, one should not look at AI as a separate domain. It’s about you infuse AI as an enterprise foundation and start to apply it in different spheres. How do I apply AI in customer service or consumer-facing use cases? How do I apply it in the middle office? How do I apply it in the back office?” 33


D I G I TA L S T R AT E G Y AI GOES BIG Kumar, or KK as he is known, is a company veteran having served HCL Technologies and its subsidiary HCL Comnet since the turn of the millennium. During this time, he has keenly observed the rise and commercialisation of AI both in India and now in the UK, noticing a ramp up in scale regarding the nature of AI projects being carried out by organisations of varying sizes. This is reflected in HCL’s own service offering, structured around its principle Mode 1-2-3 strategy. This covers core IT operations and services (Mode 1), next generation services to open up new growth areas such as data analytics, cloud, and IoT (Mode 2), and products and platforms designed to futureproof entire business models (Mode 3). Mode 1-2-3 is enacted through a massive HCL ecosystem which leverages alliances with almost 150 of the world’s most prominent technology vendors, including the likes of Adobe, Cisco, AWS, GE, Microsoft and SAP. Its beneficiaries include industry heavyweights spanning manufacturing, financial 34

May 2018

services, healthcare, utilities and transport, projects which combine to generate revenues of $7.6bn a year. For Kumar, something of a shift is occurring in that these tech projects, often surrounding AI, are going big. “For the last few years, organisations have been doing a lot of small digital projects, Mode 2 projects like small cloud migrations. “Now the customers are wanting to do big bang, large-scale digital programmes. They want to do large-scale cloud migrations. They want to scale IoT into big-scale deployments. That needs the ability to take those concepts and scale it in a global model, and that’s what we’ve been focused on.”

THE HUMAN AND THE MACHINE Such upscaling has added fuel to the increasingly fiery debate on whether automation and AI implementation will result in human job displacement – a debate which Kumar is not shy of contributing his thoughts to. “My view on this is that AI will create a lot of new jobs,” he says confidently. “Yes, it will replace certain types of role which exist today because those skills are becoming stagnant, but whole new


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D I G I TA L S T R AT E G Y

PARTNER POWER: HCL, MICROSOFT AND LAB 21 In March this year, HCL opened a US-based technology development centre in partnership with Microsoft. Lab 21, in Redmond, Washington will allow HCL to develop and deploy high-impact business solutions based on the Microsoft AI Platform that will help accelerate adoption and increase value creation for enterprise customers in areas spanning business intelligence, big data, and advanced analytics. Kumar said at the unveiling: “Our investments in Lab 21 toward developing deep competencies on Microsoft’s Cortana Intelligence stack reinforces our commitment to bringing the power of superior Cloud and AI offerings to our customers around the world through DRYiCE™, our award-winning suite of AI solutions. “Microsoft’s AI capabilities suite is a seamless and complementary fit to HCL’s leading edge autonomics and orchestration solutions.” The 5,000-square-foot lab houses a team of data scientists, architects and big data experts who focus entirely on vertical and domain solution offerings using the Microsoft AI Platform.

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departments of jobs are coming in.” Kumar backs this up by citing the McKinsey Global Institute report Jobs lost, jobs gained: Workforce transitions in a time of automation. It charts a huge range of jobs that may be created under different scenarios through to 2030, predicting that there will be enough human work to maintain full employment in the decade or so ahead. “People have this very wrong notion that AI will replace human jobs,” continues Kumar. “Rather, AI will complement certain tasks, so people have to upscale themselves to these tasks which are not repetitive and mundane. You will need the ability to make sense of a lot of data. “In some cases, this will be AI-led and human assisted. In some other cases, it will be human-led and AI assisted. You will start to realise the role which you need to play is between the human and the AI somewhere.”

COLLECTIVE RESPONSIBILITY While much of the onus has been on businesses and governments to provision the necessary upskilling required to embrace AI to the full,

Kumar also stresses an imperative for individuals to step up and learn. “Of course, one focus is how companies create opportunities for retraining and rescaling people,” he says, “but the second is about how individuals start to rescale him or herself. “The reason for that is, when you came into your current job, you came in with the current skill, or you trained for something. Now, if that is becoming irrelevant, isn’t that the responsibility of the individual also? And now with the mass of online courses available, there’s enough content online for one to learn new skills and capabilities.” Kumar refers to photography as an example. While humans may inherently have an eye for a quality photo opportunity, the add on skills of knowing how to frame, shoot and edit is what differentiates a professional from an amateur. And it is the relative ease at which humans can learn which will help prevent the mass displacement of jobs that many fear. “AI needs a lot of data to train itself, but a human can do a lot of things with very little data,” Kumar adds. 37


D I G I TA L S T R AT E G Y

“You need to be very agile, you need to be highly collaborative, you need to break down the wall” – Kalyan Kumar, CVP and CTO IT Services, HCL Technologies

DATA DRIVEN Data, as Kumar points to, is the lifeblood of AI and automation. AI cannot survive without data, and part of the conversation about reprogramming human skillsets centres on developing abilities to find and manage it. In Kumar’s eyes, therefore, data represents the largest risk in the world 38

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of AI, along with the misconception that AI will automatically transform all aspects of organisations into some form of automated utopia. “AI needs good, clean, secure data,” he says. “It is so strongly dependent on the security and quality of the data you are able to produce. “This also means thinking about how you can leverage that data across


multiple platforms. For example, we have a product called DRYiCE Lucy, which is a cognitive conversational broker. You can plug in Watson, you can plug in Alexa, you can plug in Cortana – you can plug in any channel in the front like Skype or Slack or any chatline, and we’re able to leverage these different AI capabilities.” Kumar refers to Daimler CIO Jan

Brecht, who in a previous interview with Gigabit labelled data as the new oil. This oil feeds AI, and businesses must adapt and move quickly in order to harvest data at the speed required for AI to truly provide value. “You need to be very agile, you need to be highly collaborative, you need to break down the wall,” Kumar concludes. 39


D I G I TA L D I S R U P T I O N

Data for the non-data scientist Didici enables brands to utilise data that would otherwise only be available to IT gurus. Gigabit caught up with Tony Brookes and Tim Ogle to find out why they are so passionate about making analytics for everyone. Writ ten by OLIVIA MINNOCK


D I G I TA L D I S R U P T I O N DATA IS ALL around us in everincreasing quantities, but for consumer-facing industries like retail, food and beverage and leisure, it’s how you use it that really matters. This is the philosophy of didici, a predictive analytics software company which works with these sectors to ensure that analysing data is no longer just the domain of the seasoned data analyst or IT expert. The UK-based software platform, which promises to help clients “join the dots”, was launched in April 2017 by founder Tony Brookes, who wanted to offer a more user-friendly platform than existing business intelligence (BI) software to help businesses of all sizes add value to their offering in an ever-competitive market. Brookes had previously worked in financial services and helped CitiGroup manage a $185mn budget and 400 people as Global Operations Architect. He then worked for Fidelity International, “helping them re-platform their entire system”, as part of separating the US and international arms of their business. These experiences helped Brookes appreciate the vast expense of implementing a BI platform, as well as “how much you still had to do 42

May 2018

when you had put it in,” he adds. “You spend hundreds of thousands on this platform,” Brookes explains, “but you’re really only 15% of the way there. There was lots of work integrating it, getting data and shaping it to do what you wanted. It occurred to me that the balance was the wrong way around – you should get at least 85-95% of the way there, from the platform you choose. You shouldn’t


Tony Brookes Founder

Tim Ogle Commercial Director

“You shouldn’t have to be a massive technology department in order to implement a platform like this” – Tony Brookes, founder, didici

have to be a massive technology department in order to implement a platform like this,” he concludes. Brookes’ right-hand man is the company’s Commercial Director, Tim Ogle. “In 2003, I founded one of the world’s first web-based consumer experience platforms, Retail Eyes,” he says, explaining his fascination with how digitisation can improve the consumer journey. “We focused on 43


D I G I TA L D I S R U P T I O N

utilising technology to quickly and accurately collect customer feedback and turn that into simplified insights that enabled brands and retailers to improve their service delivery, customer experience and ultimately, profitability.” It’s precisely these tangible benefits that Ogle wishes to bring to businesses with didici, which he joined following 15 years working on technology-enabled solutions for retailers and brands.

Analysis for all Didici hopes to make this easy, by enabling clients to pull together and interpret numerous channels 44

May 2018

of data, explains Brookes, who felt the existing platforms were “getting lost in the means rather than the end. It became all about the process of pulling data together, not the decision and the business that you’re driving.” That’s where didici flips the concept on its head – though there’s a lot of analytics going on below the surface, the platform is primarily for operational managers and those within the day-to-day functions of a business along with those requiring a clear picture of the business position, as opposed to IT gurus, as they are the ones who will actually be utilising this data to monitor, predict


and implement change. “A lot of the platforms you buy are very powerful but they are very much for technology people or data scientists to use,” says Brookes. “They spend forever concocting ways of getting data into it, then if that person isn’t there on the day, the report doesn’t get run.” “It isn’t easy for people to digest the output,” he continues. “If people have a question in response to some PDF they’ve been sent that is the output of these tools, they have to ask the person, who has to go away and come up with the answer.” With didici, however, the answer is available on demand to anyone who might

need it, rather than a select few. “You have a question, you click, you get an answer. You should not have to view it through the lens of data because it’s not about the data. It’s about the business. You should be viewing the data through the lens of your business and seeing the things that are meaningful to you. The data needs to help you react to something, or take a great idea and roll it out, or predict what might happen it the future.” Ogle adds: “Using analysis to extract insights from data is not a new concept, of course. However, as the number and type of users grow, it becomes almost impossible to effectively share information and collaborate. What we’re trying to do with didici is remove those barriers, democratising access to business insights. Business users and operators get the velocity and agility they need while the company maintains consistent data governance and can still continue to allow for integration, consistency and unlimited growth.” Didici’s slick platform makes some current methods seem archaic. Brookes recalls showing a client a dashboard that had been created within just 48 hours. The client 45


D I G I TA L D I S R U P T I O N had tables of data that told them “everything and nothing at the same time”, as he puts it. “We pulled this up on the dashboard, and two of them said, ‘there’s the question we got from the Chairman yesterday that took us four hours to answer’ – it was right there on the screen. We initially onboard and integrate our clients’ data with the minimum of effort from them, and after the initial onboarding, the data flow is seamless.” Initial conversations like this with clients are an important part of the didici process. “It’s not a cookie cutter solution,” Ogle explains. “We take a collaborative approach with the clients to identify their particular challenges and how we can utilise the platform, customising it slightly for them to get the most out of it.” As a smaller company, didici can offer this more personal, tailored approach, and Brookes thinks that’s a huge achievement. “We are a group of highly experienced, talented people who can come in as a small and effective team and make a massive difference in a very short space of time. We’ve done lots of engineering into the platform and how it works so we can do that – you 46

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can scale it and, with a bunch of sensible defaults, should only have to edit the things that are different for a particular business, rather than starting from scratch every time.” “We’re privately owned at the moment,” Ogle adds, keen to show how this small company is making a big splash. “We’re passionate about what we’re doing. We help retailers make a difference. We focus on recruiting like-minded individuals who want to work closely with us and, more importantly, closely with our clients, to really shape something different.” The future of consumer brands


“It’s not about the data. It’s about the business. You should be viewing the data through the lens of your business and seeing the things that are meaningful to you” – Tony Brookes, founder, didici

This business is doubtless set for expansion, but where does it plan to go next? “Clients are looking at ways to harness technology as effectively as possible,” Ogle muses. “I love the way technology has developed and evolved over the past 15 years. It’s been incredible. In 2003, there was no Facebook, Twitter, online customer satisfaction surveys or iPhones. Brands have had to grow and change with these technologies. Take Domino’s Pizza for example: their biggest single department is now IT and it’s commonly referred to as a tech company that happens to sell pizzas.

That’s a trend we will continue to see both on the high street and online. It’s exciting to support these brands as they grow.” Brookes adds that a shift toward mobile is something didici has built itself around. “We put a tonne of energy into making sure you can pull up the exact same dashboard on any device and it will just adapt. That is a massive technology challenge people are facing, irrespective of where you are in retail.” As brands increasingly work across multiple platforms, making sure every aspect reaches its full potential is the only way to beat the competition. 47


D I G I TA L D I S R U P T I O N

“As the number and type of users grow, it becomes almost impossible to effectively share information and collaborate. What we’re trying to do with didici is remove those barriers” – Tim Ogle, Commercial Director, didici

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Didici’s software allows businesses to spot outliers, such as one shop in an area of 10 that isn’t doing so well whilst the rest are exceeding their targets. The business can then take this data and interpret it, “so you’re not just saying sales are down, you’re saying they’re down because… and giving people a way of jumping straight into the thing they care about. 95% is fine, so they can zoom in on the 5% that needs attention,” says Brookes. In an industry where brands have multiple branches and platforms, this allows managers to hone in on less successful areas and find out how they can be brought up to scratch. It’s important, adds Ogle, because “it’s a highly competitive landscape out there. Be it retail, F&B, leisure or hospitality, businesses are running out of areas they can compete in – now it’s about looking at how they can maximise their operational efficiencies and margins. How can we turn that dial by 0.25% or 0.5% to have a massive impact on your business?” “We’ve got some great new features we’re building out,” enthuses Brookes.

“We’re looking at building a ‘What-If’ calculator. If you run a trial in half a dozen stores it can help predict the impact of rolling it out across your whole chain. Overall, though, the thing we’re most excited about is bringing on more and more clients and starting to see what we can do for them.” “Through being client driven, ultimately you are industry driven as well,” Ogle explains. “Consumers have an expectation and forward-thinking businesses are going to adapt and deliver what the customer wants. We’ll continue to support our clients as their businesses and industries evolve. “It’s about making a difference for our clients and ultimately their consumers as well. Everything we’re doing must be tied to return on investment. We want to make sure that clients can easily identify the tangible returns they’re getting from working with a converged platform and solution like didici. We are very commercially and operationally focussed, and I think that’s something retailers and brand providers will find very exciting.”

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ARTIFICIAL INTELLIGENCE

The virtual desktop Global tech expert Scott Amyx tells us why we are at the start of an exciting new age with endless technological possibilities Writ ten by STUART HODGE


ARTIFICIAL INTELLIGENCE

THE ADOPTION OF home smart speakers, particularly Amazon Echo, has seen a remarkable jump over the past 12 months and the exponential increase is expected to continue in the years to come. Research from OC&C Strategy Consultants earlier this year showed Amazon’s Echo has 10% penetration of American homes, leading the way from Google’s Home (4%) and Microsoft’s Cortana (2%). 52

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Overall, 13% of homes have smart speakers and that’s expected to rise to 55% over the next four years – good news for all the tech giants except Apple, which appears to have been left behind due to Siri’s lack of AI capabilities. But just where is the limit for this brave new world which we now inhabit? To find out, Gigabit spoke to


Why Amazon and Alexa are winning the race Amazon has a firm hold over consumers’ buying decisions, with 85% of voiceshopping consumers selecting the products Amazon suggests. A big factor in this has been the success of Alexa and Amazon Echo and we asked Scott Amyx what they’ve done right to steal a march on the competition? He says: “One of the things that’s very important is when Amazon Alexa and Amazon Echo started to come out, they didn’t sell it as a very advanced artificial intelligence piece, but rather they spoke in a kind of ‘common’ way.

“We’re just scratching the surface, and one of the things we’re going to start to see is that just about every industry is going to be disrupted” – Scott Amyx

“The penetration of Echo and Dot was incredible, and it was very interesting because instead of the usual early tech adopters that you would think of being associated with a tech launch and so forth, these were mums, these were kids, these were just certain people that were not necessarily really adopters when it comes technology. “But they start to place them in their home, and as they start to interact with Alexa, there was a certain expectation that built over time where they said ‘well if my Alexa, if my Echo, or Dot can speak, why shouldn’t my computer, why shouldn’t my lamp, or something else for that matter?’ “What’s very interesting about Amazon in particular is that they have very clear tenets, or pillars that drive their company ethos, and one of those has to do with innovation. Their philosophy is that doing the typical primary research, customer surveys, interviews, and panels is insufficient.


ARTIFICIAL INTELLIGENCE Scott Amyx, a global thought leader in exponential technologies who describes his work as “ushering in the fourth industrial revolution”. According to Amyx, we are at a fascinating period in history with regards to AI user technologies and interfaces as they now begin to become wore widely adopted on a mass scale. “The acceleration of the AI curve is getting to a point where it’s becoming more pervasive,” says Amyx, who is also a managing partner with Amex Ventures, a venture capital firm. “We’re just scratching the surface, and one of the things we’re going to start to see is that just about every industry is going to be disrupted. “We’re at a very interesting point from human-machine interface (HMI) in the sense that we are starting to move slowly away from touch-based to the next category, which is speech-based. “Things like Amazon Echo, Dot, Google Home, Home pods and so forth, these are carved by things like Alexa, API services, Google Assistant, Cortana for Microsoft. These technologies are starting to get integrated into everything from 54

May 2018

timeless vehicles, to home products.” Such is the pervasion of these technologies that voice commerce is now being seen as the next major disruptive force in retail, and this is backed up by the OC&C Strategy Consultants study referenced earlier. It calculates that voice shopping is set to jump to $40bn by 2022, rising from $2bn today, and Google CEO


Amyx says we are at a fascinating period in history with regards to AI user technologies

Sundar Pichai has indicated that 20% of the queries on mobile apps and android devices are now voiceoriented searches. And as these techs advance, we are undergoing somewhat of a cultural evolution as human beings to interact with them and that is what allows for them to actually be embraced more widely. But beyond that even, Amyx

believes that human behavioural trends are potentially one of the things holding even more futuristic technologies back from becoming commonly adopted as part of the marketplace. “Generally, the speed or the slope of technological evolution is always going to be steeper and faster than our human ability to adopt it,” says Amyx. “Not because we can’t, but because of cultural aspects and human behavioural aspects which need to change. “In many ways, the smartphone 55


ARTIFICIAL INTELLIGENCE form factor, in terms of the physical object that we hold onto, is going to probably last a little bit longer than maybe some of us researchers would like to see. Not because we can’t, but because people are not ready to make a huge leap into just wearing contact lenses, and being able to virtually call up your interface, and desktop and everything you need on a virtual basis, by waving your hands.” It’s a fascinating prospect and Amyx feels strongly that the swell in consumption of these types of technologies is a truly global phenomenon, especially given that the development upside of these techs is fairly limitless. He also reckons, when it comes to AI, that the culture between the companies vying to be most relevant and innovatitve is “both cooperative and competitive”. “If you think in terms of a national or global basis, you have countries like China, that have put a stick in the ground saying they want to be number one, and their patents and their capital in terms of backing the research and startups are there to support that,” says Amyx, who is releasing his latest book ‘The Human 56

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Race: How Humans Can Survive in the Robotic Age’ later this year. “Russia has often indicated that AI is incredibly important, specifically for applications for military. Our US startups of course are leading a lot of the research, as well as places in London, so there is very much a sense of competition, however at the research level


“Generally, the speed or the slope of technological evolution is always going to be steeper and faster than our human ability to adopt it” – Scott Amyx

it is also very open as well.” So we know where we are in terms of where these technologies have got to, but what about where they are headed next? Amyx is involved in work that touches on even more mindboggling prospects such as trying to accelerate the notion of singularity, as well as the ability to be able to

potentially embrace immortality by being able to upload our minds to a brain-computer interface. That’s no doubt still a long way off but he believes one of the important aspects that is about to become more widely prominent is that the future is not necessarily a singular HMI, but rather multi-modal, meaning that at any given point 57


‘People are not ready to make a huge leap into just wearing contact lenses, and being able to virtually call up your interface, and desktop and everything you need on a virtual basis’ – Scott Amyx


ARTIFICIAL INTELLIGENCE we may be using multiple modes from speech and touch to gesture, and other forms and combinations of those to get our work done. “One of the reasons that Microsoft has developed HoloLens because it believes that worker productivity doesn’t necessarily have to happen in front of a desktop or a laptop,” adds Amyx. “HoloLens’ aspiration is to be able to become the new computer interface, where it frees you from having to sit down. You can pretty much walk about... you could be in a conference, and everyone wearing that effectively has a huge field of view to be able to do just about anything. “Some of the examples of these cases are things that are oriented around healthcare, surgeries, or even education and information, so you’re actually able to bring a part of anatomy, live in a 3D dimensional vector, where people can walk around and almost feel like you can touch it. You have other trends like shared economy, where people are choosing not to own cars or own homes. Then you have retail disruptions, you have laundry lists of dozens if not hundreds of retail companies that are going bankrupt

and closing stores. When you factor all of these things in, it means that the very context of cities and work and commuting changes dramatically. So, what does the future workplace look like? Will there even be a workplace at all? “In the future we may not have to go into a physical workplace,” Amyx says. “And when we have things like mixed reality and like augmented reality and other aspects, it means that even if I’m in the most remote area going for a walk, I can still be productive, I can still be connected if I so chose. “It means that when you think about a factory floor, which are starting to become more hyper-automated, you don’t need to have people having to reactively maintain and fix problems, because AI systems are going to gather data from these IoT sensors or nodes in the system, predict potential failure points, predict inefficiencies and so forth, and proactively send technicians or even robots themselves to fix those problems, so that you don’t have downtimes or loss in productivity. So it is very much disruptive, and the kind of implications we’re talking about are significant.” 59


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S O F T WA R E

How to make your

business GDPR read Gigabit hears from Scram Software’s Founder Linus Chang about how his software development team is enabling SMEs to be GDPR compliant and protect their data with ScramFS

Writ ten by DAN BRIGHTMORE


dy


S O F T WA R E SCRAM SOFTWARE IS an award-winning cyber security software development company founded by Linus Chang, serial entrepreneur and creator of BackupAssist – a global provider of automated Windows server backup and recovery software for small and medium sized enterprises (SMEs) which has sold over 170,000 copies in 165 countries (customers include the Department of Homeland Security and NASA). Chang was inspired by a real market need for security. “SMEs started jumping on the cloud bandwagon without giving a second thought to security,” he recalls. “What if a hacker breaks in and steals your data? What if they start deleting data? There just weren’t good encryption solutions available that allowed SMEs protection.” Chang explains that coding ‘crypto’ is not like coding a website – it’s a completely different language and applications. ScramFS was born.” highly mathematical. One bug, Chang spoke with contemporaries oversight or minor flaw means the in the industry who expressed interest system becomes completely insecure. in an API so they could implement “That’s why I connected with one hassle-free encryption into their own of my former classmates (Dr Ron software. “The ScramFS encryption Steinfeld) who, apart from being a system was researched, developed genius, has become one of the world’s and peer-reviewed over three years by leading cryptographers. I engaged a team of security experts in the fields him to develop a general-purpose file of information theory, cryptography, encryption system that would allow compression, data backup and developers like me to develop secure processing including Steinfeld, a 64

May 2018


“The ScramFS encryption system was researched, developed and peerreviewed over three years by a team of security experts in the fields of information theory, cryptography, compression, data backup and processing” and Dr Toby Murray, a leader in software security (The University of Melbourne, Australia),” reveals Chang. Chang concedes that developing a solution to protect against data breaches in a commercial setting was more challenging than he could have imagined. “Both the process and the product are unique,” he explains. “ScramFS is, in itself, revolutionary and makes it super easy to encrypt files, and store them anywhere, while

– Linus Chang, Founder, Scram Software

being secure from attackers and from the cloud provider. It operates in a ‘trust no one’ environment, which is completely new. It also avoids ‘vendor lock-in’ – use whatever cloud you want, and switch whenever you want.” ScramFS can encrypt a variety of data – everything from text files and video to images and forensic 65


S O F T WA R E

How Scram FS Works

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data. It allows for ‘live usage’ of that file through real-time decryption – for example, you could encrypt a video, and watch it without having to decrypt the entire file first. These encrypted files can be stored locally, or in the cloud (Google Drive, OneDrive, Dropbox, Amazon S3) with the whole process easy to use for system administrators and software developers. “The level of rigour has been extremely important,” says Chang. “Whereas other vendors are under pressure to release early with bugs, we have been methodical, following every step, double and triple checking things along the way. Why do we do that? Because, sadly, there are real problems with the current state of security software.” Chang points out that security software is unregulated, so vendors can make unsubstantiated, vague and false claims – something he calls the “snake oil” problem. “It’s impossible for a user to verify the security of a product,” he laments. “Vendors generally provide few or no details about their product, and exactly what they protect and don’t protect against. That leads to ‘placebo security’. We designed the system to be long-term

secure – resistant to attack from quantum computers. We know we’re on the right track because when we talk to leading cryptographers, they’re keen to assist.” When asked why businesses should choose ScramFS to stay secure, Chang’s response is compelling. “I’m not just developing Scram Software for other companies. I’m doing it for my other business (BackupAssist). As an industry insider, I know the problems of dubious encryption products, so that’s why I’d choose it to be GDPR compliant.” He highlights Scram’s transparency, the reputation of its cryptographers and the cost of implementation as reasons why: “I don’t want my employees to waste their time trying to patch something together with open-source components. I want something that works out of the box. Time is money. Reliability is key and, to be honest, I just don’t see any offerings in the marketplace that provide the functionality we do.” Chang believes ScramFS can help businesses with their digital transformation and protect the security of their back-end operations by delivering confidentiality in the 67


S O F T WA R E cloud, API options for developers to add encryption to their own offerings and a command-line interface for system administrators. “We have other products planned for 2018,” adds Chang. “These will allow business applications to use encryption for collaboration and productivity via the cloud. ScramBox provides secure encrypted file sharing and can be used with ScramNotes, a secure encrypted notepad. We also provide an API, so other software providers can find business opportunities delivering encryption.” The technologies Scram is developing will be integrated into future releases of BackupAssist products. “We’re adopting ScramFS for our own GDPR compliance, and to OEM into our next generation of backup products,” confirms Chang. “We’ll also be looking at setting up a distribution channel – to partner with cybersecurity consulting firms and resell ScramFS through them.” One of Scram’s biggest successes to date was providing one of its pilot sites, CoreDNA, with a way forward on HIPAA compliance (a US regulation requiring the encryption of protected health information). CoreDNA is a 68

May 2018

website platform (CMS, ecommerce, pre-built applications) used by over 500 companies including Langham Hotels, Tivoli Audio, and Nintendo Australia. “Prior to discovering ScramFS, they had received sales leads who asked if their solution was HIPAA compliant. As they did not have crypto expertise, they had to turn away customers,” recalls Chang. “Now, with ScramFS, they can add support for encryption into their CMS, ensuring their backups of customer data are securely encrypted, and kept confidential and inaccessible by their own employees. It’s a business opportunity for them, and one for which they can charge a premium.” CoreDNA’s CEO Sam Saltis is a huge advocate: “Working with Scram to integrate encryption features into CoreDNA not only helps us be GDPR compliant, it in turn helps us ensure the security of our clients’ information. In particular, I was impressed with the seamlessness of the integration of ScramFS into our architecture. The time and cost of implementing a custom encryption module in CoreDNA ourselves would not have been commercially viable.” Early adopters of ScramFS have


“I don’t want my employees to waste their time trying to patch something together with open source components. I want something that works out of the box. Time is money. Reliability is key and, to be honest, I just don’t see any offerings in the marketplace that provide the functionality we do” – Linus Chang, Founder, Scram Software

been across multiple industry sectors. They include global CMS and web platforms (such as CoreDNA), HR and recruitment platforms (keen to protect sensitive data such as resumes and psych reports), telco providers (legally required to encrypt metadata logs), and managed service providers wishing to provide encryption solutions for their clients. All cite the need to be immune to ransomware attacks. Chang has spent more than three years bringing ScramFs to market

and had to overcome significant challenges along the way to support all major operating systems and a diverse range of cloud storage providers by designing customisable interfaces for each. “Encryption has a reputation for being difficult, mysterious and costly, so most people don’t do it. And they think they don’t need to do it. We’re keen to convince businesses there’s a simple, affordable solution that’s also high-quality and trustworthy. Meet ScramFS.” 69


TOP 10

TOP 10 BLOCKCHAIN PLATFORMS HERE’S OUR RUNDOWN OF THE WORLD’S TOP BLOCKCHAIN COMPANIES BASED ON MARKET CAPITALISATION Writ te n by MAR K S PEN C E


TOP 10

10 BRAVE

Brave is a web browser that blocks advertisements and trackers. According to Brave, ‘Digital advertising is broken. It is a market filled with middlemen and fraudsters, hurting users, publishers and advertisers. The Basic Attention Token (BAT) was developed to address this.’ Users viewing ads will be rewarded with BATs which can then be used for premium content or services on the platform. Founded by Brendan Eich and Brian R. Bondy in early 2017, Brave has around 2-3mn users and market capitalisation of $340mn.

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9 GOLEM

Launched in late 2016 by Julian Zawistowski and Piotr Janiuk, Golem reached 4mn users by the end of 2017, with its market capitalisation standing at $500mn. Golem’s goal is to become the decentralised supercomputer of the world. Essentially, the project allows owners of idle PCs to rent out processing power to its infrastructure and rewards them with Golem’s network token – GNT.


8 STEEM

Steem is a blockchain-based social media platform that was founded by Ned Scott and Dan Larimer in the summer of 2016. It’s thought that around 500,000 people use it and market capitalisation is $850mn. Steem users earn rewards by posting relevant content, curating quality content by upvoting and by holding Steem-based currencies in a vest fund, which generates interest. Rewards depend on the number of “likes” a post gets.

7 AUGUR

Started back in August 2015, Augur is the brainchild of Jack Peterson and Joey Krug. Market capitalisation is $1bn. Augur is a decentralised prediction market that’s built on top of the Ethereum blockchain. A prediction market is a tool for forecasting the outcomes of future events. Prediction markets allow users to trade based on their expectation of how a real-world event will play out and lets them buy shares based on these predictions.

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6 COINBASE

Coinbase is a secure online platform for buying, selling, transferring and storing digital currency. Its ambition is to ‘create an open financial system for the world and to be the leading global brand for helping people convert digital currency into and out of their local currency.’ It is currently one of the top digital currency wallet and platforms for exchange. In 2016, it was transformed to GDAX, the Global Digital Asset Exchange. Market capitalisation stands at $2bn.

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OMISEGO

OmiseGO market capitalisation is $2.7bn. Built on the Ethereum platform, OmiseGO’s objective is to become the leading, peer-topeer cryptocurrency exchange platform. A financial platform, it intends to disrupt current financial institutions and methodologies. Founded by Jun Hasewaga and Donnie Harinsut, its team of advisors includes Vitalik Buterin.


4 QTUM

Qtum has been running since March 2017 when it was launched by Patrick Dai, Neil Mahi and Jordan Earls. Qtum is a cryptocurrency and Smart Contract platform that aims to combine the best of both worlds. The platform uses Account Attraction Layer to combine Bitcoin Core and Ethereum Virtual Machine. Market capitalisation is $5bn.

3 IOTA

Launched in July 2016 by David Sønstebø and Dominik Schiener, IOTA is a transactional settlement and data transfer layer for the internet of things. This system has no transaction fees, low confirmation time and employs a new distribution ledger called ‘Tangle’. The company received significant investment from the Bosch Group in 2017 and market capitalisation is approximately $15bn.

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RIPPLE

Ripple provides one frictionless experience to send money globally using the power of blockchain. Its main goal is to make an entire system devoted to money transferring. Launched in 2012 by Brad Garlinghouse and Stefan Thomas, Ripple currently works with more than 75 banks all over the world. Market capitalisation is $30bn.


ETHEREUM

In their own words, Ethereum is a decentralised platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference. Launched in July, 2015 by Vitalik Buterin and Jeffrey Wilcke, Ethereum was the most popular platform for ICO in 2017. Market capitalisation is $73bn.

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‘IoT net blockch that on configu creden perform actions

Could Blockchain Transform Manufacturing? How will blockchain impact the manufacturing sector? Kate O’Flaherty compares the reality with the hype. It is the distributed ledger system that enables cryptocurrencies, but blockchain technology offers new use cases across multiple vertical industries. Within the Internet of Things (IoT), blockchain’s applications go beyond security and authentication to asset tracking and the exchange of smart contracts, which give devices a way of handshaking and exchanging information according to mutually agreed rules. Indeed, the claimed potential of the technology to boost efficiency in supply chains, for example, has resulted in a number of projects and pilot programmes that focus on the IoT. The Trusted IoT Alliance – a consortium of companies that includes Bosch, Cisco, Gemalto, and Skuchain – was formed in September 2017 to focus on how blockchain and the IoT can intersect for business advantage. Recentl AI and blockchain technologies Recently, have been combined by Fetch.AI to create autonomous ledgers that can act as smart agents on behalf of a person, organisation, or technology. iom-uk.internetofbusiness.com

Yet more than most new technologies, blockchain is surrounded by hype on the one hand and criticism on the other. For every claim that blockchain forms the basis of a new data commons, there is another saying that it is slow and inappropriate for 90 percent of the tasks that it is being proposed fo And for every claim that it forms a new, for. more secure bedrock for tracking goods and services, there are voices suggesting that it is a flawed technology. Is the hype real? Innovative ventures certainly abound – using blockchain to track and authenticate contracts, for example, and both physical and digital assets – while even some blockchain experts express reservations about the technology and suggest that it urgently needs to evolve. So, taking all of this into account, what will the real impacts be on the manufacturing sector? The There are multiple uses for blockchain in manufacturing. According to Shaan Mulchandani, global security strategy and blockchain leader at Aricent, blockchain-based processes and smart contracts can facilitate automated security and compliance checks as part of the p manufacturing/building process.


tworks can leverage hain solutions to ensure nly devices with valid urations – or trusted ntials – are accepted and m a limited set of s.’

He says: “IoT networks can leverage blockchain solutions to ensure that only devices with valid configurations – or trusted credentials – are accepted and perform a limited set of actions.” In the future, futu manufacturing will increasingly see the IoT and blockchain intersect, powering robots that are able to teach themselves, says Van Ostaeyen. He cites the example of Sewbot, a robot that makes clothes without human intervention, which could take advantage of blockchain in the futu to become fully integrated into the future supply chain.

In addition, Van Ostaeyen claims that manufacturing will “become 100 percent transparent through blockchain”. In the future, he predicts: “There will be no tampering, and no fakes or counterfeit goods.” Th claim seems unlikely. However, it is clear That that manufacturing is itself slowly transforming from a slow, monolithic process into a smarter, more automated, more localised one, in which smaller facilities that cater to local needs replace offshore outsourcing, which is based on the lowest labour cost. Read full article.

Radisson Park Inn London, UK 5-6 June 2018 Taking place in London from 5-6 June; the Internet of Manufacturing UK conference and expo is your opportunity to network with and learn from those driving IoT adoption for Manufacturers as well as your peers already benefiting from this innovation.

The summit will examine in detail how Manufacturers can enhance their IoT strategy focusing on ROI, blockchain, additive manufacturing, connectivity, AI/analytics and security. All attendees will leave with tailored roadmaps to the adoption of these next generation technologies to reduce costs, imp improve efficiency and increase ROI.

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E V E N T S & A S S O C I AT I O N S

Events The biggest and best events and conferences from around the world‌ Writ te n by AN D R E W WOO DS


E V E N T S & A S S O C I AT I O N S

CDO Conclave

tbc, Johannesburg, South Africa May 7-8 Organisations across the world are understanding the gravity and urgency of digital transformation. The focus on digital transformation innovations has never been greater. Organisations are progressively looking at making sure their business strategies are reinforced by the right technologies and that lack of digital maturity isn’t stopping them when making key business decisions. The 4th edition of CDO Conclave will continue on the journey of digital revolution, but on a much bigger scale. Be it digital strategies,

ICT SPRING

European Convention Center 4 Place de l’Europe, Luxembourg 1499 May 15-16 As an influential voice in the worldwide Tech community, the aim of ICT Spring is to encourage emulation and networking between business decisions makers, innovation managers, startuppers, researchers and venture capitalists on a European scale. It is a yearly event held in Luxembourg City which is dedicated to exhibiting and demonstrating the latest relevant trends and innovations and discuss their impact on society and the working world. This year’s edition will feature four main topics: FinTech, Digitalisation, Space & Artificial Intelligence.

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infoShare

Gdansk, Poland 22-23 May Every year infoShare brings together thousands of people looking for a platform to learn, connect and evolve. Developers, startuppers, investors, executives, innovation leaders, marketers, and media who want to explore the world of technology. “infoShare is where you can share your story and make your ideas happen. Here you will find knowledge and inspiration, form meaningful relations and create a truly innovative technological society.” www.infoshare.pl

Money 2020 Europe

The RAI, Amsterdam, Europaplein 2-22, Amsterdam, Netherlands, 1078 GZ 4-6 June An unmissable event for the smartest visionaries and innovators, Money20/20 is the destination where payments, fintech and financial services come together to connect and create the future of money. In June 2018, Money20/20 lands in its new home – the Rai in Amsterdam – to once again focus the world’s eyes on Europe. Everyone is here, every time, coming together to explore unique regional insight and trailblazing enterprise, seizing the opportunity to meet the person or land the deal that will change the trajectory of their business.

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Machine Intelligence Summit Hong Kong 6-7 June

Discover advances in machine learning and smart artificial intelligence from the world’s leading innovators. Learn from the industry experts in speech and image recognition, neural networks and big data. MIS will explore how machine intel will impact communications, manufacturing, healthcare and transportation. The summit will showcase the opportunities of advancing trends in machine learning and their impact on business and society. 30 speakers, 250 leading technologists and innovators, as well as workshops, seminars and debates. www.re-work.co/events/machine-intelligence-summit-hong-kong-2018

The AI Summit

Kensington Palace, London, UK 12-14 June Join 10,000-plus visitors, 3,000-plus delegates, 300-plus speakers at The AI Summit London – devoted to helping business cope with the fourth industrial revolution. Now in its third year, the world’s first and largest conference and exhibition to look at the practical implications of AI for enterprise organisations, the actual solutions that are transforming business productivity, the AI Summit aims to help the business leader, data scientist, engineer successful implementing their AI projects. www.theaisummit.com/london/ 86

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CeBIT 2018

Hannover Fairground, Hannover, Germany 11-15 June CeBIT is the largest and most internationally represented computer expo with 100,000-plus attendees and 3,000 exhibitors. CeBIT is a show and a conference programme for professionals that defines the latest trends, presents talks by high-calibre speakers and forwardlooking panel discussions, and showcases product innovations from all over the world. Artificial intelligence (AI) is going to be in the spotlight at CEBIT in June of 2018. “AI is certainly one of the most exciting developments of our times, and one that is on the verge of revolutionizing our personal and professional lives. In fact, AI literally has the potential to change the world – reason enough for it to be featured in a big way at the upcoming CEBIT,” said Oliver Frese, the Deutsche Messe Managing Board member in charge of CEBIT. www.cebit.de/home

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‘The Webit Festival is the European edition of the Global Webit Series including speakers and representatives from European Commission, WTO and the Global Commission on Internet Governance’ WEBIT Festival Sofia, Bulgaria 26-27 June

The Webit Festival is the European edition of the Global Webit Series including speakers and representatives from European Commission, WTO and the Global Commission on Internet Governance as well as many tech and business leaders. Topics of discussion will include smart cities, cyber security and AI. The winners of the Webit Awards 2018 will also be announced. www.webit.bg

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THE CONFECTIONARY CATALYST TECHNOLOGY AND INNOVATION INSID

Written by Catherine Sturman Produced by Kiron Chavda


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Responsible for Mondelēz International’s Global Innovation, Director of IT Henson Sy discusses how the company continues to disrupt the Asian snacking market

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ncreasingly busy lifestyles and an evolving global demographic are influencing consumer eating habits like never before. Demand for products which consumers can eat on the go, that are easy, healthy and accessible from a cost perspective, are all important factors which are reshaping the development of new products across the food and beverage industry. Amassing a net revenue of $9.7bn in 2016, and with 30,000 employees worldwide, confectionary juggernaut Mondelēz International houses a number of renowned snack brands. From Cadbury, Côte d’Or, Oreo and BelVita, to Babbaloo and Philadelphia, the company remains committed to driving business growth and fulfilling its ambition to ‘create delicious moments of joy’ for consumers.

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“When you receive a snack, the feeling you get is a sense of happiness- a moment of joy. We put a lot of that passion into the way we work, and the way we make and market our products,” Director of Information Technology Henson Sy explains. “We have gone through a number of transformations, but at the end of the day we remain focused on wanting to be the best snacking company in the world, by delivering moments of joy.” Responsible for managing global innovation at Mondelēz and furthering its technological capabilities, Henson has streamlined the company’s


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Henson Sy

Director of Information Technology

Henson started his career in Technology. Having studied, implemented and created technology, his passion has always been to make technology work- to find that intersection where technology enhances lives. Combining his experiences in the large technology companies like Oracle and Apple with large consumer goods companies like Johnson & Johnson and Mondelez, Henson now leads Global Innovation at Mondelez

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MeraNet

Making Sales a Science... AUTOMATING DOWNSTREAM SUPPLY CHAIN MANAGEMENT

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ATS ( ASSET TRACKING SYSTEM) Tracking & Monitoring Chiller Deployment

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Automating sales activity & tracking real time sales details

MINI DMS FOR SUB STOCKISTS DMS for stockists & Sub stockist

DMS (DISTRIBUTOR MANAGEMENT SYSTEM) A complete ERP for distributors

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THINK DISTRIBUTION - THINK MERANET

Meranet is a platform that drives the automation of sales and distribution functions. MeraNet specifically caters to companies with operations in markets Mr. Radhesham Dhoot where vast distribution channels are required to make products available to consumers.

COMPANIES TO PUT IN PLACE MANY ADDITIONAL PROCESSES WHICH SAVES TIME, RESOURCES AND MONEY.

MeraNet is especially purposeful in markets where companies are supplying their products to consumers through distributors or wholesalers.

Heera’s backend team is highly responsive to handle such customization – AGILITY

MERANET IS MUCH MORE THAN JUST A SIMPLE DISTRIBUTOR MANAGEMENT SYSTEM. In countries where traditional trade is dominant and modern trade is just making its ground, business models can appear complex. In such markets, products reach retailers through multiple sources like distributors, wholesalers and sub-stockists. Distributors are separate legal entities and retailers are not the direct customers of the company, hence acquiring sales data from retailers is difficult and inaccurate. In traditional trade dominant markets, most of the retailers are not even using computerized billing systems and in some cases lack willingness to share data. It is thus imperative to rely on secondary sales data i.e. distributor to retailer sales information, in order to allow sales and marketing teams to make quick decisions.

MERANET HAS MADE IT POSSIBLE FOR COMPANIES TO HANDLE SUCH COMPLEX ECOSYSTEMS WITH EASE AND HAS ALLOWED

Heera offers the MeraNet solution as a platform and the customers can choose required modules.Customization may be needed in such markets where business processes are different and evolving.

WITH SPEED is Heera’s USP, along with deep domain knowledge of such markets, business models and ecosystems. With a complete focus on SUPPLYING

AUTOMATION SOLUTIONS FOR DOWNSTREAM SUPPLY CHAIN MANAGEMENT FOR THE LAST 20PLUS YEARS, Heera developed many

solutions to meet customer requirements:.

MONDELEZ ACKNOWLEDGED HEERA’S EFFORTS BY WAY OF GIVING THE BEST SERVICE PROVIDER AWARD CONSECUTIVELY FOR 4 YEARS. MONDELEZ CONSIDERS HEERA AS A PARTNER AND NOT JUST A VENDOR. Heera has always strived for learning new technologies so that it can be used for enhancing existing solutions as well as for creating new possibilities for customer’s business automation needs. With best talent and expertise Heera will always be at customer’s service and customer satisfaction is Heera’s motto.


M O N D E L E Z I N T E R N AT I O N A L

EMBRACING THE FOOD AND BEVERAGE INDUSTRY IN ASIA PACIFIC IS SET TO BE WORTH $2.6TRN IN 2018

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sales and marketing operations and partnered with manufacturers, global leaders, and in some cases, region and sub-region presidents to look at new ways to drive business growth by utilising new digital tools. “We are telling them, ‘if you want to increase, for example, salesman productivity and improve in-store executions or net revenue management, there are certain technologies that you should be investing in,’ he says.


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“For example, with sales force automation (SFA), we show what it will look like in the next few years. If I’m bringing in this thinking, it can then be built into their roadmap. When I first joined in 2014, Mondelēz’s sales force were selling via pen and paper. In some rare instances, they may have had Netbooks,” he continues. “We made a big bet for our sales force to use mobile devices. It was a necessary first step. The full deployment of mobile devices has become more cost effective and ubiquitous. It makes data available to us almost instantaneously. We use app stores which are freely available to mass deliver the app. Looking at what’s next, I asked instead of giving sales reps the app, why don’t we give the retail stores the app, where they can have this service on their mobile devices in the store.” “Beyond this, we looked at chatbots via Facebook Messenger and so on. We have different technologies, bringing intelligence behind it as well. Machines can figure out what to sell best in that store based on

“We remain focused on wanting to be the best snacking company in the world, by delivering moments of joy” Henson Sy, Director of Information Technology history and location trends, and let the sales staff just monitor or manage relationships,” he adds. In the area of net revenue management, which is one of the hardest capabilities to introduce to any FMCG company, we implemented a regional tool from Retail Insights. In this space, it is extremely rare to find one tool implemented in a whole region but we did that so every market now views and measures trade numbers the same way. Upon implementing SFA for

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M O N D E L E Z I N T E R N AT I O N A L

THE COMPANY HOUSES BRANDS SUCH AS CADBURY, CÔTE D’OR, OREO AND BELVITA

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sales reps, Henson also worked to implement cloud technology to support its mobile app platform to strengthen its security mechanisms, minimising potential risks or delays in service. “Last year, we were hit by a malware which took down most of our systems. The only thing that did not go down was the sales apps because they were all on the cloud,” comments Henson. “Using this as an important lesson, cloud technology is now being extended to other functions. We are now bringing technological innovation into our operations, not


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“We are now bringing technological innovation into our operations, not just in sales and marketing, e-orders, digital marketing or ecommerce, but into supply chains as well, finance and HR” Henson Sy, Director of Information Technology

just in sales and marketing, e-orders, digital marketing or ecommerce, but we’re putting it into supply chains as well, finance and HR.” Innovation culture With the introduction of the Hub for Innovation team, which Henson is a part of, Mondelez is seriously investing into innovations. The team’s focus is to think big, innovate fast and disrupt at scale. It has rolled out proof of concepts around the world that have positively impacted business as well as drive a culture of innovation.

Additionally, the launch of Mondelez University will encourage employees to look at new ways of working and learning. “We partner with Accenture amongst others, in the innovations space, where they have provided a framework to how we set up an innovation culture, how we set up innovation immersion sessions so that we drive the whole culture, from top to bottom,” says Sy. “We also harness best of breed technologies from SAP and distributor management system by Infosys Edgeverve. We have a

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MONDELEZ AND RETAIL INSIGHT: DIGITAL TRANSFORMATION DRIVING THE ORGANISATION’S CAPABILITY JOURNEY Retail Insight have been a part of Mondelēz digital transformation journey for many years. Throughout this relationship, we have always focused on two core outcomes: securing improved business results, and building sustained organisational capability. Picking up results along the way ensures that, despite the enormous scale and complexity of a programme such as the Navigator Revenue Management implementation, we maintain momentum in the right direction on this transformation path. Our focus on organisation capability growth is critical, so that the organisation possesses the skills and knowledge to sustain and drive better results using the new tools and technology at their disposal.

form a best-in class Revenue Management eco system. A true Digital Transformation indeed, and we are excited to continue to jointly build capability through the live Navigator platform.

Our journey together therefore goes far beyond simply implementing and deploying new technology solutions. A strong joint governance team is in place to maintain a relentless focus on the vision that Mondelēz are pursuing on the Net Revenue Management space through Navigator. Facilitating a low barrier environment between the steering team, corporate functions, and the hundreds of end-users across multiple demanding markets, has created a culture where all stakeholders not just feel ownership for achieving a best-in-class Revenue Management function, but also know that their feedback and input is directly influencing the implementation and adoption plan. Digital transformation is not complete until the organisation has embraced and adopted the desired ways of working and supporting technology. A step-bystep capability journey has been key to our adoption success. By mapping strategic business priorities to improved ways of working, supported through intuitive and easy to understand Navigator UX, the organisation has built capability and could point to immediate and sustained results, before progressing to the next level on this journey. This transparent and collaborative set-up has driven organisational adoption, as markets share results and learnings across the region, to

London

Singapore

About Retail Insight We are a global people and technology company, who understand our industries and their trading challenges first hand. But we don’t rest on our experience. We blend this domain knowledge with a curiosity and desire to find new analytic approaches and techniques. This is how we design the most appropriate data driven, analytics solutions to help our clients trade more effectively. We do not believe that one size fits all, so we’ve created dynamically modular and scalable products to meet the needs of our unique clients in over 50 countries. We believe the future of analytics is democratisation; creating and sharing relevant and accessible insight across organisations, top to bottom, left to right. The solutions may be complex, but the output should always be easy to understand for anyone to take beneficial action. Insight should be for the many, not the few.

www.ri-team.com

Sydney

info@ri-team.com

Bentonville


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“We partner with Accenture amongst others, in the innovations space, where they have provided a framework to how we set up an innovation culture” Henson Sy, Director of Information Technology

MONDELĒZ AMASSED A NET REVENUE OF $9.7BN IN 2016

product, which is scalable and just works. When we implemented it in the Philippines, we just replaced all of our legacy client-server tools with this cloud-based solution.” Personalisation The food and beverage industry across Asia-Pacific is predicted to amass $2.6trn in value this year, and is expected to steadily rise, with China being the main country responsible for this rise, according to Statista. Consequently, the company is striving to expand its renowned wellbeing brands, improve the nutrition and ingredients of its snacks, and develop further products which each market will savour. “We know consumers are looking for healthier snacks and meals, paying particular attention to the ingredients used,” observes Sy. “In the US and Europe, we have BelVita, which is an early breakfast snack. When we launched it in China, it was a surprise that consumers didn’t like it. We heavily marketed it as a healthy alternative, but the take-up

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was not where we want it to be. “Chinese people and Asians in general do not like to bite into hard stuff in the morning. They eat buns, breads, porridge, something which is easy to bite and digest. Giving them a hard snack such as BelVita wasn’t going to work,” he says. “Another product was Oreo. Although it is quite popular in the US, when we took this to China or elsewhere in Asia, like India, we’ve had to either reduce sugar content or increase it. The twist, lick and dunk ritual is also an American concept that required being accustomed to at first.” “To them, you just eat the biscuit. To make it more exciting, we introduced different flavors that used different ingredients. Take for example, Oreo Green Tea Ice Cream and Oreo Strawberry.” “With the health food segment in China growing substantially in the recent years, we introduced Oreo Thins as a snack with lesser calories. This is an innovation coming out of China. Because it’s thinner, psychologically people think that it’s an

“With the health food segment in China growing in recent years, we introduced Oreo Thins as a snack with lesser calories. This is an innovation coming out of China” Henson Sy, Director of Information Technology acceptable indulgence, and rightfully so because of the lower calories. So, we’ve now exported that thinking to the rest of the world,” he adds. With a number of renowned, powerful brands, Mondelēz is also looking to remain competitive by catering to the growing trend of gifting and the personalisation of its snack products. “It used to be that if you bought a bar of Cadbury, it would be the


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M O N D E L E Z I N T E R N AT I O N A L

same anywhere. Nowadays, if you tried a Cadbury’s bar in Australia, versus one in India and Malaysia, Malaysia’s version is much sweeter whereas in India it is milkier. It’s almost personalised to the market. We’re undergoing mass customisation,” explains Sy. “Technology grows from mass customisation to mass personalisation. If I want give you a bar of chocolate for your birthday, for example, I would like the ability, as a consumer, to personalise this for you. “Being a healthier choice is another consideration for us. We’re cutting down on sugar, as most markets are introducing sugar taxes.” Such decisions will create further appeal for consumers to engage in purchasing snacks long-term, yet the company will continue to face challenges, ironically as a result of digital innovation. Evolving consumer buying behaviours and the rise in online shopping will continue to impact the company, as Sy acknowledges that snacks are something of an impulse purchase for many.

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“This is where our challenge is in Asia. A lot more consumers are going online, so we are working hard to be part of that basket size. We have set ourselves up for a $1bn target by 2020 in ecommerce,” he adds. Manufacturing capabilities The establishment of nine technical centres at Mondelez will consequently work to ensure the company remains ahead of the competition. Its most

THE COMPANY ESTABLISHED A CENTRE IN JURON WHICH WILL W RESEARCH, DEVE QUALITY MANAG


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recent launch of its facility in Jurong, Singapore, will be responsible for its work across research, development and quality management (RDQ) and strengthen the company’s position on the global stage. “We will look at innovations in terms of manufacturing and packaging at our technical centres. Take for example how we create the next generation of chewing gum. Sale of chewing gum is banned in Singapore, but the RDQ of

HAS RECENTLY A TECHNICAL NG, SINGAPORE, WORK ACROSS ELOPMENT AND GEMENT (RDQ)

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“A lot more consumers are going online, so we are working hard to be part of that basket size. We have set ourselves up for a $1bn target by 2020 in ecommerce� Henson Sy, Director of Information Technology

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our gums is based here,” chuckles Sy. “We test how much can you chew on a gum, the force and pressure, how long the taste will last, all at our RDQ centre in Singapore. We also look at how certain packaging compares to other types of packaging and utilise 3D printing.” The facilities will also feed into Mondelēz’s sustainability goals, where it looks into using sustainable ingredients like palm oil and cocoa (in conjunction with Cocoa Life Program). Mondelēz’s strong brands, its creativity and focus on developing wellbeing snacks in alignment with consumer preferences will secure its position within such a competitive space. Utilising digital tools to promote innovation ensure speed to market and provide increased transparency will see it remain a leader and a source of inspiration across the industry.

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Written by Laura Mullan Produced by James Pepper


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YAT R A O N L I N E P V T LT D

By leveraging trailblazing technologies, Yatra Online is fulfilling the needs of the burgeoning Indian travel market to ensure that wherever your journey leads, it’s a good one

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ith a mushrooming population of around 1.3bn people, a burgeoning middle class, and travel becoming mainstream, the Indian travel sector is growing swiftly, and it shows no signs of slowing down. Vacationers are not shying away from opening their wallets either, with the Indian travel market projected to reach a value of $48bn by 2020, according to an in-depth report by Boston Consulting

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Group (BCG) and Google India. Yatra Online, named after the Hindi word for ‘journey’, prides itself on understanding the true meaning of travel, making sure that whether you’re looking for hotels, holiday packages, bus, rail or flight tickets, it is a name you can count on. As competition from foreign players like Airbnb and Booking.com has intensified, Yatra has steamed ahead with technological innovations that are helping the firm redefine itself


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as a digitally-driven tech company, that just so happens to be in travel. “We are a digital-first organisation which derives most of its value through the use of our technology platforms by customers in various channels – whether it’s a user doing their own travel planning and booking, a corporate user booking for their work travel, or an agent serving a walk-in customer in a remote location,” says Chief Technology Officer Himanshu Verma.

“Technology is front and centre of our operations today and will be a major driver of operational efficiency and service expansion going forward.” The greatest benefit of such a hightech travel offering? It allows Yatra to tap into three sales channels of travel – business to business (B2B), business to consumer (B2C) and corporate sales – allowing it to cast a wide net in the lucrative Indian market. “It gives us a unique valueadding proposition to serve all

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REACHING BEYOND Global R&D services and Digital transformation solutions provider, Hughes Systique has been instrumental in steering the digital transformation journey of its clients. HSC’s innovative solutions encompass Applications, Security, Blockchains, IoT, Machine Learning and SMAC.

Email address: info@hsc.com Website: hsc.com


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segments of the market in equal measure,” Verma explains. “We are among the top three players in all the segments. We have over 7mn B2C users, we serve over 650 corporate clients, and we have over 19,000 travel agents across the country using our booking platform.” Tapping into the rise of mobile With mobile apps incessantly at our fingertips and mobile internet prices becoming more competitive,

Yatra Online has paid special attention to the rise of mobile users, making it the “front and centre of the company’s strategy”, according to Verma. The results speak for themselves, with the firm’s mobile traffic growing almost 100% and its transactions growing by 130% in recent times. “A large number of people in India are only using the internet on mobile,” observes Verma. “Many of the younger generation, for example,

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have skipped using PCs and have been using the internet only on mobile. “Therefore, from that standpoint, we have really focused on mobile and revamped our entire mobile platform,” he continues. “Over the last 18 months, our traffic on mobile has grown at a fairly fast pace. Today 75-80% of our traffic is on mobile and almost 50% of our transactions happen on mobile and that is the part that has been growing fast.”

Scalable, accessible In a traditional travel company, tools for search, booking, customer support, and housekeeping are usually standardised with staff providing domain expertise, personal service and trust. While this model works, says Verma, it’s not scalable and efficient, whereas in a technology company the interface for customers are endpoints like websites, mobile apps


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and chatbots. Algorithms do most of the tactical decision making and people focus only on what matters – strategic decision making. “Customers can get most of their queries related to their booking resolved either via proactive communication or speaking with our AI-driven bots to get the answers,” Verma explains. This makes services scalable, predictive, and highly accessible wherever the customer is. “While this kind of transformation can be hard, risky, or capital-intensive, it’s not optional for us if we want to remain relevant and progress in the future amidst accelerating changes,” says Verma candidly. “Our quest has been to serve the customers in their travel itinerary as much as possible – from travel inspiration, to planning, to booking, to in-destination services – so that customers can seamlessly use our services end to end,” he adds. “This cannot be done without a consistent technology platform behind it. When it comes to customer

“Technology is front and centre of our operations today and will be a major driver of operational efficiency and service expansion going forward” Himanshu Verma, Chief Technology Officer

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Today, almost

75-80% of Yatra Online’s traffic is on

MOBILE and almost 50% of its translations happen on mobile

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experience, we want to be wherever the customer is, we want to evolve with our customers and, in some cases, we want to invent new ways for customers to evolve their experiences.” A one-stop travel firm Whether it’s finding travel inspiration or booking your flight, no single travel company today provides end-to-end services. To become a one-stop shop for travel, Verma and his team have seen a root-and-branch transformation of the company’s technologies and platforms. In doing so, Yatra Online hopes to provide end-to-end services for its customers so that they don’t need to engage with endless companies. To this end, Yatra Online has internally developed its website, mobile apps and most of its backend systems as well as its customer relationship management (CRM) and customer support system. Yatra has also built its own decision sciences and intelligence platform, which is being used to power services like algorithmic discounting, cross sell and personalisation of services.

Continually evolving With such a tremendous technology push, this has undoubtedly had an impact on Yatra Online’s team and its company culture. “Our team has doubled in size and there has been a definitive cultural shift,” notes Verma. “We have made continuous learning a key pivot for the organisation so that people are constantly learning new technologies, experimenting with them and figuring out new ways to serve our customers better. “We recognised that we will not be able to find enough people externally who have depth and expertise in technologies like artificial intelligence, machine learning, and hence we focus on re-learning for a sizable number of people from the team.” Continuous improvement is at the very foundation of Yatra Online’s strategy and it is this drive to consistently grow and evolve which has propelled the company into the spotlight as a leading travel firm. Not one to sit on its laurels, the company has ambitious plans for the future.

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“The immediate goal is to build deeper organisational skills in new technologies like machine learning, artificial intelligence, internet of things, big data, analytics and solve some of the deeper problems around automation, personalisation, and optimisation,” Verma says. “We have made significant progress in these areas in last year and we are continuing to invest heavily in them,” he continues. “In the long-term, we want to create a solution for multilingual, voicebased interface so that we can provide personal services to nonEnglish speaking demographics.” Close industry ties The Indian travel market is growing exponentially and, with new groundbreaking technologies coming to the fore, every day. Verma says that Yatra Online’s strategic partnerships are crucial for the firm’s operations. “These partnerships play a significant role not only in our current operations but also on our future preparedness,” he notes.

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Since it was first launched in

2006, more than

7 MILLION CUSTOMERS have used one or more of Yatra Online’s travel-related services

“We have a deep relationship with NetMagic, who is our private cloud hosting provider, we use Akamai deeply for various edge services and we use AWS for everything related to data sciences. “We also have a partnership with Adobe for analytics and marketing, and we have a close relationship with GDS companies like Travelport and Amadeus,” he adds. “Yatra is constantly talking to or experimenting with a widerange of technology partners,

large companies and startups alike, to see if we can leverage their tools and technologies and move our charter further. “These partnerships are incredibly important as we cannot do all the work alone.” India’s travel planner These trailblazing technologies, strong industry ties and a commitment to providing a best in class customer experience has distinguished Yatra Online

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Himanshu Verma, Chief Technology Officer Himanshu Verma joined Yatra as CTO in Apr 2015 and leads the technology strategy, planning and execution for Yatra products across all channels. He has over 20 years of experience in technology industry across a wide spectrum of domains. For past decade, he has been focusing on building products for ecommerce and internet industry working with companies like Flipkart and Yahoo!. Verma worked with Flipkart for three years leading engineering for supply chain and logistics and Yahoo! for six years leading engineering for Yahoo! Front Page, Toolbar, Mobile Web and HotJobs. Prior to this, he also worked with Oracle, InterSolutions and Cadence Design Systems in various technology roles. Verma holds a B.Tech. degree in Computer Science and also attended executive general management program at IIMBangalore. In his spare time, he loves to read and travel.

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as one of the leading travel brands in the country. Since it was first launched in 2006, more than 7mn customers have used one or more of its travel-related services and, with an array of accolades under its belt, it’s clear that Yatra is set to becoming India’s top travel planner. “In the next five years, I envision Yatra to be a technology company which owns and operates one of the largest travel platforms that will provide one-stop marketplace for all travel needs with the widest selection, best prices and personalised service at all steps of travels,” Verma says. “Have we figured out how to achieve it all? Not yet. Are all the technologies available to be able to do it? Not yet. Do we have to fight the organisational and ecosystem inertia to do it? Absolutely. But who said trying to create future is easy.”

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Integrating data, boosting

connectivity Written by Catherine Sturman Produced by Kiron Chavda


Chief Information Officer Lutz Beck discusses how Daimler Trucks Asia is working to drive connectivity across the commercial vehicle industry and to transform it into a data driven organisation

H

ousing an envied and world-class reputation, Daimler Trucks Asia (DTA) has cemented its presence as a leader in manufacturing and transportation. An integral subsidiary of manufacturer Daimler AG, the organisation has worked to transform its existing business model and diversify its portfolio, developing new products and services to sell to its customers in an ever-growing industry. However, in order for this to happen, its core vision has remained clear – to drive connectivity. “At DTA, we want to lead the commercial vehicle industry into the future and be number one in quality, innovation, customer satisfaction and places to work. We want to connect everything,” explains Chief Information Officer Lutz Beck. “Our transformation is ongoing on an organisational level, but we are in the midst of a cultural change as well.”

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Lutz Beck

Chief Information Officer

Lutz Beck, currently CIO for Daimler Trucks Asia / Mitsubishi FUSO Truck & Bus, is a business savvy, and result driven Senior Executive with extensive international leadership experience and a can-do attitude. A problem solver, analytical thinker and pioneer able to manage critical and complex transformations with an innovative approach to get the job done. He has benchmarking experience working in large multinational companies in the automotive industry and led and motivated large global teams to achieve target outcomes. Beck is global and a leading key player having worked across multiple regions and cultures in the fields of digital strategy and transformation, business process re-engineering and improvement, project and program management, SAP template implementation, system landscape renewal and innovation technology management. A true expert on the international scene and digital forefront, motivating and a sensational leader pushing those around him to new heights.

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A DEEPER PERSPECTIVE.

For DTA to be able to achieve its vision of leading the commercial vehicle industry through the power of data, disruption is not only inevitable, it’s mandatory. “We need to use all the technologies and innovations available to redefine our business model,” DTA CIO Beck notes.

“We have to be a disruptor in the industry and disrupt our own company to prepare it for the future.”


The road less travelled. Quality management steps into the spotlight.

80% of these recalls could have been detected in advance based on the historical data patterns.

That disruption began in an unlikely place, one that wasn’t well known for its innovation - quality management. Its department head Michael Moebius admits that what it lacked in futureforward thinking, it made up for in data. Data filters through quality management from over 150 countries, but its conventional analysis system was outdated and relied on siloed internal sources captured through traditional means. As a result, quality and safety issue identification and investigation times were reactive, and focused on historical analysis after the problems had already matured. This long and sometimes inaccurate process yielded high warranty costs and delayed recalls.

Solidifying a futureforward foundation. While the quality management department had access to a wealth of data, it didn’t necessarily know how to analyse it most efficiently. Beck confirms: “We were collecting data, but not using it in a way in which you could make decisions or create business models out of it.” This gap in skills highlighted a key area of attention for Beck, who believes that the foundation for everything within a company is its people. It was this desire to lay the correct foundation for DTA’s digital transformation that led to the relationship with Deloitte. Ashwin Patil, Deloitte Consulting LLP Managing Director for Global Manufacturing Analytics, remembers: “We were able to gather folks from strategy, cloud, digital tech, data scientists—we brought key people to the table to help drive this.”

The power of collaboration First, Deloitte analysed all of the available data from 45 of the last major DTA recalls. This included structured data like metrics correlated with its vehicles to unstructured data, such as call centre records, warranty claims, dealer and technician comments and social media engagement. Based on this combined analysis, Deloitte discovered that

The opportunity to look even further into the future became possible with the introduction of live data through DTA’s launch of Fuso Super Great, its first connected truck and foray into the internet of things (IoT). As the truck is driving, geographical data and data from the vehicle’s system like oil pressure, coolant temperature and battery voltage is combined with the historical data, providing DTA with the insight to see the overall health situation of a truck. According to Moebius, this proprietary cognitive system, dubbed “proactive sensing”, enables DTA to implement “predictive intelligent maintenance and service planning, which ultimately helps us get ahead”. The success of Daimler Trucks Asia and Deloitte’s proactive sensing project hinged on the teams’ desire to function as an innovative client relationship. They embraced the “flavor of a startup”, where constructive criticism flowed freely, enhanced by regular meetings at the staff and management levels to create an open environment for questions and ideas. Deloitte also took a second look at DTA’s internal resources and developed skill profiles to identify gaps in capabilities.

Smarter insights, stronger outcomes. The proactive sensing project is expected to save DTA $8mn in warranty costs during the first 24 months and even more in recall costs. The system is also able to predict and prioritise quality issues 13 months ahead of its previous process, which helps keep customers on the road with less downtime. “By doing this project, we were able to generate awareness for data at a management level,” Beck states. “The project helped us shape an overall business case for the big data topic. Now everyone wants to have it. The whole company is pushing for it.” The journey for DTA doesn’t stop here, however. The constant cycle of disruption continues, not only for the organisation and the industry, but also for the ever-changing world that is becoming increasingly reliant on connectivity, data and the internet of things.

avasudevan@tohmatsu.co.jp | Ajai Vasudevan,

Director Automotive, Deloitte Tohmatsu Consulting


DAIMLER AG

Connected X Driven by its senior leaders, DTA’s digital strategy, Connected X, has seen the organisation overhaul its outdated infrastructure and application landscape. By deconstructing its back-end and legacy systems, DTA has rebuilt its internal processes through the use of new technologies, enabling it to move into an increasingly digital world based on a new digital foundation. “By transforming into a datadriven organisation, the key aspects will be how we work with data and how we understand the data,” observes Beck. “Integrating all data is also in accordance with our

overall Daimler Truck Asia strategy. “We defined our Connected X strategy based on three pillars – product, process, people – in a bid to drive Daimler Trucks Asia towards a data driven organisation and connect everything by fully utilising the Internet of Things (IoT),” he continues. “We needed to work on core elements such as digital products and services, data driven and modern methods and skill sets.

(Right) Daimler’s new, smart E-FUSO Vision One model

“By transforming into a data-driven organisation, the key aspects will be how we work with data and how we understand the data” – Lutz Beck - Chief Information Officer

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“On the product side we are focusing on improving new as well as existing production sites and vehicles by digital enabling them. On the process side, we work on efficiencies through automation and robotics. On the people side, we

Data-driven technologies The need to collect and enhance all data has been essential throughout DTA’s aim to enable the business units to perform data driven decision-making and innovations. The combination of Truck

VIDEO: Deloitte Client Spotlight Daimler Trucks Asia

started to train, renew and scale up the team, bringing a combination of traditional IT skills and new digital skills which are required to run such complex transformations. “There are not many companies in our industry that are doing this in such a way, so we have become a frontrunner in terms of digitalisation.”

connectivity and analytics helped the organisation in quality management (QM) processes to unlock saving potentials and business value. By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks. The ability to gain

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Empower every person and every organization on the planet to achieve more. Microsoft Enterprise Services Enable every organization to become a digital business


d

Mitsubishi Fuso Truck and Bus Connected X by Microsoft AI & MR


By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks

VIDEO: Cognitive Technology in the real world of Daimler Trucks Asia

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real-time data has therefore enabled the development of new solutions and delivered significant cost savings across the board. “There is nothing which we are doing which is not giving us either internal benefits or new business opportunities,” adds Beck. “I do not have cases where we do not have savings or additional revenue streams achieved by introducing new technology.” One key example is the development of DTA’s proactive sensing analytics. Built in partnership with Deloitte, the two companies analysed a large number of QM information surrounding the health of DTA’s trucks. Through this, the companies found a number of patterns in the high volume of data received, paving the way for a solution to be developed. Through proactive sensing, DTA is now able to detect issues in advance, reducing downtime and increasing the safety of its vehicles through predictive intelligent maintenance. “It doesn’t matter if you talk about big data, artificial intelligence, machine learning or deep learning, all these new ideas are helping us to be number one in quality, innovations and customer satisfaction while being more efficient and more cost-effective,” notes Beck. To further solidify its position as a techleader in the commercial vehicles industry, w w w. g i g a b i t m a g a z i n e . c o m

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Mitsubishi Fuso has also developed and launched the all-electric light-duty truck eCanter which is in seriesproduction since last year, as well as the concept heavy-duty truck, E-FUSO Vision One. Developed from feedback received from customers, the E-FUSO brand will open doors to the development of further connected, electric-powered vehicles across DTA’s fleet, and will also work to reduce emissions whilst strengthening its position in the market.

Experimental technologies Although the organisation has worked to invest in new technologies and extend its areas of innovation, the need to mitigate potential risks within its IT operations has never been more important. Enhancing its cybersecurity has therefore become a key focus within DTA’s digital strategy, and a team has been established to proactively manage security patterns across its manufacturing operations. Interestingly, the organisation is also looking at other ways to transform its production capabilities through the

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increased use of new technologies (such as robotics) and defined the concept of the Factory of the Future based on Industry 4.0 principles. “If I look at the production, we can use much more automation and robotics in the manufacturing space. We are on the way to connect wherever possible our robots in order to collect real-time data, and based on that take real time decisions on predictive maintenance and other topics,” explains Beck. “Secondly, when we are looking into our office environment, there is a lot of automation and efficiency gains which are made possible by using robotics. Therefore, we are looking at how we can gain further efficiency in the office environment through the use of robotics and are looking at automating processes which today are paper-based.” DTA is therefore undertaking increased experimental research in using robots for specific topics. For instance, it is also utilising famous Japanese robot Pepper to look at ways in which it can boost efficiencies.


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“We defined our Connected X strategy based on three pillars – product, process, people – in a bid to drive Daimler Trucks Asia towards a data driven organization and connect everything by fully utilising the Internet of Things (IoT)” – Lutz Beck - Chief Information Officer w w w. g i g a b i t m a g a z i n e . c o m

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“It doesn’t matter if you talk about bi artificial intelligence, machine learn deep learning, all these new ideas are us to be number one in quality, innov and customer satisfaction while b more efficient and more cost-effect – Lutz Beck - Chief Information Officer


ig data, ning or helping vations being tive�

CASE STUDY How Daimler Trucks Asia utilised data-driven insights to proactively change the course of the entire organisation


DAIMLER AG

The power of collaboration By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks

Proactive sensing technology has enabled DTA to detect potential issues up to a year in advance

The E-FUSO brand will open doors to the development of further connected, electricpowered vehicles across DTA’s fleet

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Competitive edge Through blending traditional ways of working with new ideas and technologies, DTA’s working culture and subsequent development and training of employees, has consequently undergone significant change. “We are continuing to upscale our existing people in new technologies. This is an ongoing task which we do internally and with external support,” notes Beck. “We also looked at the skillset in the market and employed people who had the required skill sets and brought them into the company. We have now built up skills on analytics, artificial intelligence and virtual and mixed reality. We are also taking on new people for our connectivity platform and for our connectivity for our trucks.” It is clear that DTA will continue to disrupt the commercial vehicle industry, where it will seek to develop increasingly connected, tech-driven products and services for its customers. However, speed will remain essential in such a competitive space. “This is a challenge, but we want to take that challenge and see how we can move forward and combine these elements with the new technologies coming in for our customers and for our organisation,” concludes Beck. “We will need to see how we can further use technology to transform the organisation, our business model and how it will enable us to create new business services in the future.”

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SAP Ariba and the transforming landscape of procurement As the supply chain industry continues to evolve, SAP Ariba plays a key role in defining the future of procurement Written by Dale Benton Produced by Glen White


SAP ARIBA

T

he very nature of procurement and the supply chain is changing. Advancements in technology and innovation have significantly shortened the lifecycle of products, forcing suppliers and procurement functions to transform their approaches. As procurement and supply chain has changed, so too has SAP Ariba. Speaking at SAP Ariba Live in Las Vegas earlier this year, Marcell Vollmer, the company’s Chief Digital Officer, looked to the future of procurement and more importantly, how it will continue to move beyond delivering cost savings and process efficiencies. “For the last two decades, procurement has been on a journey that has led to dramatic transformation. But the journey is just beginning,” Vollmer said. “Over the next 10 years, companies will face more opportunity and disruption than ever. And procurement will play a critical role in maximizing these opportunities to create business value. In embracing digital technologies and strategies, procurement can reimagine the function and beyond delivering cost savings and process efficiencies, fuel innovation and market advantage.” Mark Schenecker, VP Supply Chain, Procurement & Networks with SAP Ariba, has seen this transformation happen first hand in large scale organizations, both in culture and in practice.

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SAP Ariba Business With Purpose

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The direct approach to procurement transformation As the pace of digital business accelerates and as customer expectations rise, supply chain transformation has become a priority for many organizations. Reimagining procurement—especially direct materials activities—offers an opportunity to help your organization gain efficiencies, mitigate risks, serve customers better, and identify new areas for growth.


Proactive value For any business, direct materials can represent a huge slice of the actual costs of doing business. But transforming direct materials in a holistic, strategic manner can prove challenging. Deloitte’s Direct Materials Value Transformation approach can help by supporting a more proactive, more strategic approach to procurement. By bringing together a host of capabilities in a unified portfolio, Direct Materials Value Transformation provides a single source of leading-edge solutions for addressing needs all along the source-to-pay continuum. The potential payoff? A tighter, more value-focused supply chain that can support greater supplier collaboration and help you maintain a competitive edge. Elements of Direct Materials Value Transformation

18,500

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Strategic insights and SAP technology implementation, supported by a network of 18,500 professionals focused on SAP solutions—and 8,500 focused specifically on the supply chain function

Deloitte Accelerator for SAP® Ariba®, a fully pre-configured SAP Ariba solution that blends cloud and on-premise ERP capabilities

Cognitive spend capabilities leveraging machine intelligence and advanced analytics to identify patterns and generate insights

Global Sourcing Insights to help companies analyze, visualize, and act on complex direct materials sourcing issues

Tax tools to help automate processes such as tax determination

Should-cost analysis and parametric cost modeling

Third-party risk management

Supplier enablement

Supply chain optimization

www.deloitte.com/SAPAriba @DeloitteSAP Copyright © 2018 Deloitte Development LLC. All rights reserved. Member of Deloitte Touche Tohmatsu Limited.


SAP ARIBA

Mark Schenecker Vice President, Strategic Customers Business Networks, Supply Chain

Mark works in the Ariba Center of Excellence for strategic customers at SAP Ariba, drawing on over 20 years of experience in SAP Business Suite, supply chain management, business networks, the Internet of Things and SAP Ariba Cloud Solutions. Mark transitioned out of the SAP development organization and now specializes in guiding customers on the Ariba Business Network and supply chain solutions to achieve incremental value with speed and simplicity. Mark is a frequent speaker on future technologies and is the author of numerous articles, one book and 4 patents.

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“People are understanding this more and more. It’s about responding quicker, and more cost effectively and how we can create this near real-time instantaneous communication with our suppliers and treat them as an integral part of our supply chain and network” – Mark Schenecker, Vice President, Strategic Customers Business Networks, Supply Chain

With SAP, Schenecker plays a key role in working on the implementation of industry-leading cloud-based applications to some of the world’s largest companies in order to better collaborate with a global network of partners. Vollmer’s sentiment is echoed by Schenecker, who feels that as the procurement transformation journey will only continue to develop further, now more than ever companies must embrace a far more collaborative approach in order to keep up. “Typically, in the supply chain space, the conversation will start around demand planning,” says Schenecker. “From that, you make up a supply plan based on your customer requirements and then you

share that with the suppliers. This is often referred to as forecasting. “Forecasting, though, is very hard to get right because there’s some level of variability that you just can’t control.” Schenecker points to large companies that tackle this challenge of forecasting demand through collaboration. Rather than spending resources through inventory buffers to mitigate risk in supply, or create more precise forecasting, companies will work collaboratively with their suppliers in order to respond to a change in demand instantaneously. In the ever-changing pace of product cycles, this is crucial to being able to deliver true value to the supply chain. “It’s about making your supplier

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42808 Christy Street, Suite 221 Fremont, CA 94538

800-440-2137 intrigosys.com


These are just some of the real-world successes that Intrigo and SAP have delivered together. It is not just about technology. It is about spotting opportunities early, ensuring that it is the right fit for your organization, and adapting to en ensure that you can capitalize on them. Often, this requires transforming yourself, even if it means wrenching change. You need the right partner.

$300 million in reduced inventory at Albemarle, $250 million saved at Microsoft, in just the first year.

Intrigo has defined and delivered on large scale digital transformation efforts at some of the most prestigious global corporations. As many of our clients will vouch, their transformation journey was cr created and executed by Intrigo. We have helped our clients reinvent themselves and gain market leadership while substantially improving their bottom line.

range of industries such as High-tech, Fashion, Consumer Products, Manufacturing and Chemicals. Leveraging our knowledge and experience of specific implementation scenarios, we translate our insights into outcomes, ensuring that technology ou and processes are optimized to flourish in today's complex and competitive environment.

Intrigo is an SAP channel partner and a leading provider of Advisory, Implementation and Support Services. Intrigo has a hands-on leadership team who collectively have over 100 successful SAP implementations to their credit. Th These include S&OP, ERP, Supply Chain and Analytics for a wide

Intrigo is a co-innovation partner of SAP in a number of areas including SAP IBP in Supply Chain Planning and SAP Ariba Supply Chain Collaboration for Procurement. We are a recipient of the SAP Ariba award for the innovator of the year, and our entire senior leadership team is recognized in the industry

for their thought leadership, expertise and innovative mindset. Headquartered in the Silicon Valley, we constantly advocate leveraging packaged applications to meet the constantly changing demands of business world. We have registered offices in Houston, Dallas, Jersey City, Heidelberg, Bangalore, Hyderabad and Ba Chennai from where we support our clients across the globe. Our clients include internationally renowned brands such as Broadcom, Oclaro, Corning, NVIDIA, Dolby, TriQuint Semiconductors, Clorox, Aptina Imaging, Allergan, Vishay Intertechnology, and Albemarle.

Learn more at https://intrigosys.com/resources/case-studies/


SAP ARIBA

network tick through collaboration,” Schenecker says. “People are understanding this more and more. It’s about responding quicker, and more cost effectively and how we can create this near real-time instantaneous communication with our suppliers and treat them as an integral part of our supply chain and network.” SAP Ariba works with companies in creating solutions in order to establish and build this “tight knit” collaborative network. Millions of companies all over the world use SAP’s cloudbased network to manage their business relationships and allow their customers to shop, share and save. This network is what enables that true collaborative approach. It allows buyers and suppliers to collaborate on transactions, manage their entire procurement process from source to settle, all the while controlling costs, finding new sources of savings and building an ethical supply chain. One of the key advantages in this collaboration is reducing lead times. A typical plant, when processing an order, could have a month of supply of parts. These parts are either

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stored by a supplier, sometimes via a 3PL, or stored on the factory floor or warehouse. This is often inconsistent and will vary from product to product, part to part. “If we run this through our tight knit collaboration you are looking at significantly reducing inventory,” says Schenecker. “Taking days or weeks of supply of inventory out of the supply chain will reduce costs. These inventory cost savings are critical to reducing the cost of the finished goods. It’s a real big move on the profit line.” Supply chain and procurement processes are often complex, taking into account direct spend (the materials that go into the makeup of a product), as well as indirect spend (services such as facilities management) which, when multiplied across numerous manufacturing lines, represents a significant investment. Schenecker points to the need for change management and how one of the biggest moves in product design is the intimate integration of procurement. Engineers or designers are sometimes in a position where they


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SAP Ariba works with compnaies to establish and build collaborative networks

will purchase parts based primarily on their familiarity with the part or vendor rather than aggressively looking for the lowest cost at the highest quality. “We are witnessing a change in the integration of procurement with design,” he says. “Whereas before it would be a case of sourcing parts to an individual engineer’s familiarity, or just looking at supply chain optimization, the challenge was that

the supplier relationship was owned by the company or by the procurement team not necessarily engineering. “Now, it is much more individual and much more owned and dictated by the joint efforts of engineering and procurement. “The lifecycle of products is much shorter today and so change management revolves primarily

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SAP ARIBA

around speed, which is incredibly difficult to manage. It can be overwhelming, but it’s about training, coaching and understanding how to leverage the entire process in order to better understand the way that you will work with suppliers.” Through the cultural change and the way in which work is managed, Schenecker notes that the role of the designers, buyers, planners, suppliers, right through the entire supply chain is beginning to converge. Historically, the different suppliers throughout the supply chain process would operate as entirely separate entities. But in this time of shorter product lifecycles, which will only continue to get shorter in the near future, the whole supply network is moving from a serial to a parallel model. “What happens now is design, sourcing, ramp to production are all working simultaneously,” Schenecker says. “You, your network, your suppliers, and your buyers and planners are all working in parallel. “Teams don’t work in a serial fashion anymore, they work in parallel and it

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all overlaps, with each other area.” This echoes back to the importance that Schenecker places on the planning process, as companies are now looking to reuse parts and streamline the introduction of new parts much more than ever before. “Today, companies are constantly cannibalizing their products in order to continue to win in the marketplace,” he says. “With the speed at which the market is changing, you have to, otherwise someone else will.” In the procurement and supply chain space there is a firm understanding that you can only be as good as your supply chain. The SAP Ariba Network, which has millions of customers and suppliers from all over the world, sees beyond the realms of being just a supplier and what it means to really be a partner.


USA

“Teams don’t work in a serial fashion anymore, they work in parallel and it all overlaps, with an overlapping of capabilities” – Mark Schenecker, Vice President, Strategic Customers Business Networks, Supply Chain

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“Sure, you look for a supplier and ensure that they make the right product, the right parts, to the right timescale and right cost,” he says. “But now you have to look at what it actually means in terms of the actual cost to do business with that supplier.” If a supplier has process inefficiencies or does not have the required integration capabilities in this ever-demanding environment of speed, then the buyer has to look at what effect that will have from a cost perspective.

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“Inefficiency for example, will bring inventory buffers into place to cover up a lack of proficiency in communications in the supply chain, which of course means added cost,” says Schenecker. This approach has changed the way in which buyers evaluate suppliers, with the quality and pricing of parts being equally as important as the ability to perform. Performance and performance measurement of suppliers has become as crucial than the supply itself.


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SAP Ariba has worked with supply chain integration specialists Deloitte and Intrigo

Working with suppliers has become centred much more around supplier management than ever before and through close collaboration, SAP Ariba helps buyers to navigate this changing landscape to truly implement new processes with little disruption. SAP Ariba has worked with Intrigo and Deloitte, integration specialists with deep supply chain expertise, as Schenecker describes. These two companies understand the SAP Ariba network, the procurement business processes, complex supply chains

and SAP Ariba solutions, and have successfully helped the integration of new process and new ways of working through close collaboration. Other key partners include Liason, an integration specialist for the buyers that don’t use SAP systems, but through the work of the company can seamlessly integrate to the SAP Ariba Network. SAP also calls upon the work of EY and Deloitte in order to look closely at integration from the change management level,

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approaching the transformation of supply chain with the view of asking the question ‘how do you implement for success?’ “Our partners have been key to us,” says Schenecker. “And the best thing is, they don’t work on just the one area. Sure, you’ll see Intrigo working on integration of SAP Integrated Business Planning, ERP and Ariba with Deloitte running change management, but all of our partners operate under the wider scope of a larger transformational journey.” As SAP continues to redefine its supply chain network in order to continue to provide true value to its supply chain and procurement partners, the question then becomes one of how to keep up the pace with the rapidly changing procurement landscape. After all, today’s best practice will not always be tomorrow’s. “Customers, and not just ours but our competitors, drive us to higher levels of innovation,” says Schenecker. “But we intend to lead, not to follow. Sure, we look to broader market to see what’s happening, but in terms of procurement and supply chain, SAP Ariba is setting the tenor, the direction and the trend for the current market. And we will continue to do just that.”

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“We intend to lead, not to follow” – Mark Schenecker, Vice President, Strategic Customers Business Networks, Supply Chain

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CONTRACTING’S

BRIGHT Hypower has remained a leader within the construction sector thanks to its open-minded and bold approach to technology adoption Written by Catherine Sturman Produced by Tom Venturo


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ne of southeast USA’s largest specialty contractors, Hypower has completed over a thousand projects valued at over $1bn. The family business’s humble origins and passion to provide quality services has seen it amass a diverse portfolio, grow to over 600 employees and overcome a number of challenges which many others have failed. Hypower houses several divisions, ranging from commercial electrical, new construction, renovation, and service and repair; to outside plant power and communications, telecom engineering, airfield lighting, ground mount solar and prime electrical infrastructure projects nationwide. Established primarily to undertake infrastructure projects in the early 1990s, the company’s specialty niche in runway lighting and airfield lighting systems, and work at the new Denver International Airport Runways put it firmly on the map. Its subsequent growth enabled the company to not only spread out geographically but add a significant number of strings to its bow. “We added traffic signals, high

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mast lighting, street lighting. We got into the traffic signal business, which filtered into the intelligent transportation system business. This taught us about fiber optic cables and telecommunications,” explains President and CEO of Hypower Inc, Bernard Paul-Hus. “In 1996, Congress deregulated the telecommunication industry to open up markets to competition by removing regulatory barriers to entry into the telecommunication marketplace, which led to a tremendous amount of investment from the private sector. This created a huge boom in the installation of fiber, which we jumped into. We moved more into telecom, but never got away from our roots in airports.” Despite the burst of the dot.com bubble, Hypower’s niche markets enabled it to remain afloat without concern, until 9/11. “9/11 was our first real big challenge because nobody saw


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Bernard Paul-Hus President & CEO

Bernard Paul-Hus, a 45-year resident of Broward County, began his career in 1986 as an electrical estimator. Bernard Paul-Hus directs the entire Hypower operation including corporate management and administration. He is committed to achieving excellence in every Hypower project through employee training, utilizing cutting-edge industry technology and his unwavering dedication to quality. He ensures that every project team is unique and individually selected based on the qualifications and abilities of each team member to enhance the project delivery. His mentorship and guidance define Hypower’s core values. Paul-Hus is actively involved in various committees and industry associations including TEC/VISTAGE Member since 1997; ABC (Associated Builders and Contractors) Board of Directors, a member of CASF (Construction Association of South Florida). Bernard is personally involved as a leader and a mentor with quite a few local charities – HANDY (Helping Abused Neglected Disadvantaged Youth), Boys and Girls Clubs of Broward County, 4Kids of South Florida and Cystic Fibrosis Foundation. Hypower donates over $100,000 to local charities every year.

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that coming,” Paul-Hus explains “We’ve always been very reactive solemnly. “It wasn’t predictable in to the market, trying to stay ahead any kind of economic model, and all of what the market’s going to do. of our airfield lighting projects shut Right now, all of our divisions are down. However, we were fortunate firing on all cylinders, but sooner or to survive it, and within a year we later things will slow down. We now were back up and running normally. have enough foresight, vision and “The lesson we learned from data to anticipate these challenges, that, was that diversity was going and to weave our way through what to be our path going forward, the world throws at us.” so we needed to really diversify ourselves Forward planning into these counterBy paying significant cyclical niches,” he attention to its continues. “The tumultuous Hypower Inc most common history, Hypower was established in thing that gets has applied these done by companies lessons towards its like ours is buildings. future goals. Utilizing But even buildings, as predictive analytics, we saw in 2008-2012 can a business intelligence pretty much evaporate. When this platform, and delivering ongoing happens, government-funded and training, employees are now able subsidized work stays relatively to elevate their abilities within steady, and if you’re good, you’re their own specialty niches. going to continue to win it. “Our focus needed to be on “We ended up with seven divisions, achieving the highest level of financial but when the recession hit, we acumen at a project management decided to narrow these down into level, and we’ve been working on the five groups that we have today. that since 2009,” adds Paul-Hus.

1991

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HYPOWER INC “Having project managers that are effectively as good as any accountant at not only the historical, but the predictive part of a project, the forecasting side, has proven to be a huge home run for us. It’s also created the ability to go from micromanaging everybody’s decisions, to putting them in this world of ‘If-Then decision making thinking’. “We believe in autonomous management making decisions. We’ve created systems and processes that allow staff to make their own decisions based on the data they’re being presented with and with the options that are open to them.” Creating a system where employees are therefore encouraged to look at data on a regular basis and look at their own performance, as well as their team performance, has taken the company to new heights. “There’s a couple of different softwares which we’ve customized. We’ve now started integrating all those platforms into our proprietary platform, called HYPE,” explains Jeff Emerson, Vice President of Electrical Construction. “This pulls in real-time data, giving

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project managers and people in the field the systems and information needed to make decisions. It pulls in how much are we spending on material, or how many hours we have spent. What is our production goal? Are we installing as much every day as we need to? What are the open RFIs? It takes all these different systems and integrates them into one. “We’re in the middle of more app development now, that’s going to give every single person in the field, no matter what level they are, a daily goal on exactly what they’re supposed to achieve,” continues Emerson. “Up until recently, we did this verbally and with spreadsheets. Now, it is automated on an iPad or Smartphone that everybody will be able to see first thing in the morning and report on throughout the day.” Digital disruption The use of data within construction and design is continuing to reshape traditional


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Jeff Emerson Vice President of Electrical Construction

Jeff is a talented and seasoned executive with over 20 years of experience in electrical contracting management and operations. He brings a wealth of expertise with strengths in areas such as financial and project execution, profit and loss analysis, workforce talent investments and long-term corporate strategy oversight. In his 8 years with the Hypower family, Jeff has shown a strong understanding of how to obtain measurable gains, identify key performance improvements and provide tangible evidence of success throughout his leadership roles. With a reputation for judicious use of resources and resulting cost containment, Jeff’s work has been instrumental in providing Hypower with leading edge best practices and management reporting capabilities critical to the success of production systems and company performance. In addition, Jeff has effectively raised transparency and visibility within the organization by bringing technology decisions and issues to the forefront of crucial Executive Committee discussions. His commitment to excellence lead the company to become one of the local pioneers to implement and utilize the use of Virtual Design and Construction (VDC) and its newly designed studio houses over 20 VDC specialists.

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practices which have remained relatively unchanged – until recently. For Hypower, it is clear that the company remains keen to take full advantage of embedding new technologies across its operations. By strengthening its virtual design and construction capabilities (VDC), as well as harnessing building information modelling (BIM) technologies, the company has optimized its processes, reduced the number of mistakes and delivered higher quality projects at competitive prices, leading the business to remain ahead of the curve. “A lot of technology that’s used in modelling software, such as Revit, Navisworks, and AutoCAD are all pretty much industry standard. It’s the level of detail that sets us apart. We look for jobs where our customers or clients are going to appreciate the value that this brings,” explains Emerson. “When we’re 3D modelling and working with the rest of the team, you can view areas of concern, such as whether a conduit clashes with a HVAC duct, for example. We fix all these things before the material

‘Hypower harnesses Virtual Design and Construction and Building Information Modelling (BIM) technology to deliver higher quality projects at competitive prices’


HYPOWER INC

is ordered, or a stick of conduit is installed. This provides a lot of predictability, allows the schedule to be maintained, and the owner can look at the model and see what his building is going to look like inside and outside before we even start. Paul-Hus adds: “It’s the ability to virtualize a project by building it in three dimensions, while working with our fellow specialty trade contractors. We can all see the problems we’re going to have ahead of time, so we can fix it in this virtual world, so that when we get out there in the job site, it goes much better.” With up to 20 dedicated VDC/ BIM specialists, all large projects at Hypower utilize these essential processes. Coordinating with various trades is therefore encouraged across all avenues and moves the company towards the purchasing and prefabrication process. “Instead of ordering what might be typically six parts and have them come out in six boxes in the field, we’ll assemble all six of those pieces off-site and ship it out with a clear label that matches our VDC

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design, where the parts are then to be put it in place. We also use the Trimble Total station, which is our layout equipment,” adds Emerson. The use of new, digital tools has also overhauled traditional layout processes. “The team used to get in the field and use a tape measure, a chalk line, flags and drawings to figure out where everything’s supposed to go based on information provided from the contractor,” explains Emerson. “Now, when we receive information, all our points are laid out in a tablet. One team member can go out with Trimble Total Station, set out the laser, and mark where it all goes. Through this, we’ve reduced layout time by 70%. “We’re now also at near zero mistakes,” he continues. “In the last seven jobs, we have never missed a layout point, to the point that we’re actually helping others who are doing it the old school way. It’s therefore


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Barry Olson Vice President of Purchasing

Barry Olson started his career in the electrical industry in 1989, working for an electrical distributor and then transitioning into the contracting side of the business. Over the years, Mr. Olson has led the purchasing efforts of several large electrical contractors across the nation before settling in with the Hypower team in 2015. Devoted to the development of a procurement system based on partnerships with vendors, Mr. Olson has made significant changes to Hypower’s basic buying philosophy that has supported both Hypower’s long term growth strategy and contributed to bottom line profitability. Olson is also actively involved in the development of Hypower’s company culture; believing that the right working environment is conducive to maximum employee contribution leading to the company’s overall success. Mr. Olson holds baccalaureate and master’s degrees in organizational leadership as well as a master’s degree in management. Olson is also planning to start work on a PhD. in the fall of 2018 that he believes will equip him to further refine and develop Hypower’s workforce for continued growth and long term organizational stability.

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bringing value not just to us, but to them as well,” observes Emerson. “This will become the new norm in how buildings are constructed,” observes Vice President of Purchasing, Barry Olson. “People in their 20s and 30s are coming into the industry with their own ideas and paradigms of how much easier computer modelling makes things, for example. “We’re in a time where we’ve got a lot of senior managers that are also saying, ‘we’ve never done it this

way, we’ve always done it the other way’, and you now have enough new information and people in the industry asking the question, ‘well why can’t we do it this way?’ “Whilst there’s a blending of the two, at some point this whole platform of how buildings are put together is going to be the generally accepted practice,” he adds pensively. “I think we’re ahead of the curve in what we’re planning, because we are looking down the road as to where this will lead.” Nonetheless, Paul-Hus explains that the technology has presented a number of new challenges, particularly within Hypower’s

“Sooner or later things will slow down, but we now have enough foresight, vision and data to anticipate these challenges, and to weave our way through what the world throws at us” – President and CEO of Hypower Inc, Bernard Paul-Hus 172

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relationships with clients. “We can become extraordinarily frustrated at how difficult it is to sell the value of this technology to the end user, which is the owner or the general contractor,” he says. “If they are not experienced with the technology, we have not developed a good way to explain all of the things that would have gone wrong had we not gone through our processes. We have not been able to quantify in any meaningful way, all of the mistakes that we fixed before we got onto the site. “Us and the other trade contractors, through the virtue of our coordination, which is generally driven by the specialty trade contractors, have fixed so many problems, that when we go out to build the job, these problems will never happen, so the end user can never appreciate the fact that they didn’t happen. “We can measure year over year improvement, but if I tell a client that we’ve been able to drive 24% of our labor cost out of our jobs year on year on the same number of manhours, their first question is, ‘why isn’t your price lower?’” The cost

HYPOWER HAS COMPLETED OVER A THOUSAND PROJECTS VALUED AT OVER

$1BN

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Before

trade off of planning for the labor gains yields predictability when done properly which ultimately saves time and the cost savings flow throughout the entire project. Increased agility Despite this, Hypower’s embrace of new digital tools continues to influence its positive culture of adaptability and change. “Five years from now, we expect that the hard hat that workers wear will have a chip in it with a visor that projects on the wall. I will walk into a room, flip down my visor and see all the work that I’m supposed to install that day,” explains Paul-Hus. “Rather than measure anything or do any layout work, it’ll actually be on the visor screen. I will simply need to walk up to where the device that I

After

need to install is, match it up with the shadow box that’s on my visor, and screw it to the wall, and I’m done.” “If you don’t have a culture that accepts the use of technology, you are going to be a company that struggles,” he adds. “The only way you do that is by implementing change, measuring performance improvement, rewarding people for following processes, and making sure that they understand this.” By placing significant emphasis on continuous improvement, Hypower is a strong believer in training and developing its workers, improving ways of working through the use of data, giving context to such data and then proactively reacting to the data received. “We don’t get focused on individual results, we get focused on

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Hypower-Employee Appreciation Night

the overall result,” says Paul-Hus. “We don’t want to put too much emphasis on profitability as the rest of our core values could get ignored; people might make decisions to boost profitability that hurts our professionalism, which then prevents us from continuously improving and ends up hurting our relationships.” Inspiring others Not one to rest on its laurels, Hypower expects the best of its staff, and makes a significant effort to give back, not just to its employees but to the local community. Its efforts to drive positive engagement and quality results have seen the company become recognized as

Business of the Year by the South Florida Business Journal in 2017. To reward employees, Hypower seeks to gather all required data and runs a number of events, inviting employees to attend. Presentations are undertaken and the company aims to recognize all staff which are leading the it to success. Additionally, Hypower’s growth has seen it give back to local communities, both through its charity events, raising over $1mn thus far, as well as recruitment of locals. Paul-Hus explains: “A young manager we recently recruited was through a charitable organization, Helping Abused Neglected Disadvantaged Youth (HANDY).

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“If you don’t have a culture that accepts the use of technology, you are going to be a company that struggles” – President and CEO of Hypower Inc, Bernard Paul-Hus

NBC Telemundo Headquarters

This individual was displaced from Haiti because of the earthquake in 2010. He was brought to the United States, where he finished high school, went to Florida Atlantic University and gained a degree in accounting. We brought him in as an intern and now he’s a full-fledged employee.” “Peter Stoykov, our Marketing Director, and I recently gave a presentation to kids on a career path

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in the construction industry. We go into the community and we say, ‘look, we understand that everybody wants to go to college, but we also understand that not everybody gets to go to college. It could be because you don’t have the grades, it could be because you don’t have the financial means, it could be for a variety of reasons. It could be because you have a child too young and you just don’t have the time to have a job, but none of that means that there aren’t career paths to success.’ “We use our company as an


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example that you can start off in the field as an apprentice electrician and apply into our program or go to school while you’re receiving training. After four years in a certified program and a Journeyman prep course, as part of our Workforce Development Plan, you will receive a professional electrician’s license.

“At the end of four years, you’re making $50,000 per year. Your career path can follow suit. You continue to take our training, supervisory training, go to seminars, whatever it takes to continue your education. Keep climbing the career path to an executive level,” continues Paul-Hus. “I’m the President and CEO and I don’t have a college degree. I’m a really good example to stand and say, having a child at 19 years old, like I did, and not having a college degree doesn’t limit your ability to think big, chase your dreams, build

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VDC IN ACTION

“We’re in a time where we’ve got a lot of senior managers that are saying,

‘We’ve never done it this way, we’ve always done it the other way,’ but you now have enough new information and people in the industry asking the question, “Well why can’t we do it this way?” – Barry Olson, Vice President of Purchasing

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a business and be a leader. Do all those things that some people might have you believe you can’t do. Don’t listen to them and don’t get discouraged. There are multiple paths to achieving your goals.” The path to success Hypower’s long-term vision to ensure its vendors, customers, employees and shareholders remain happy will see the company continue to grow and deliver exceptional value and quality services, where digital tools will continue to support decision making and guarantee exceptional results. “Growth is the cornerstone of our success,” reflects Paul-Hus.


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“Growth means that we can continue to invest in these processes. It means that we can continue to show folks that are just coming into this industry to come to work for us, that there will be an opportunity. “There is a career path that will not be stymied by running into someone who you can’t pass due to attrition. We’re growing, we expect workers to learn. The more you learn, the more likely we are to be able to offer you that opportunity that’s been generated by our growth. So, growth is super important. “If, through the use of all of our processes, we continue to drive down what it costs us to do the work versus the market value of doing that work, even when times get tough and we lower our prices, our costs will already be in line with those lower prices,” he adds. “For now, we’re benefiting with higher margins, because we continue to pursue work at a market rate, not

at a cost-plus rate. However, when we get into that really tough world of the overall market shrinking, we should be able to maintain or even continue to grow our revenue in that tough economy, simply because we, during the good times, didn’t get complacent with our success. We continued to take the products of our success and invested in continuous improvement. When times get tough, we can perform at a lower cost basis than our competitors.” Paul-Hus concludes: “That’s really our goal, to continue to take what the market gives us. Right now, there are more opportunities than we could ever react to. “But when those opportunities become limited, we will be in an excellent position, with a very well skilled workforce, and with processes that have driven down our cost so that we can remain competitive without losing money even through those tough times.”

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FILTRATION POWERED BY DATA HOW MANN+HUMMEL IS HELPING COMPANIES SAVE ON MAINTENANCE AND DOWNTIME Written by John O’Hanlon Produced by Andy Turner


Intelligent filters, smart systems and rapid product development are features of today’s MANN+HUMMEL, a traditional German company that is reinventing itself through the use of data and IoT Charles Vaillant, Chief Technical Officer


MANN+HUMMEL

A

filter is a workhorse. It’s hard to think of a mechanical system that does not have filters. They protect the moving parts from damaging particles, and in HVAC systems they protect people’s lungs in the same way. As MANN+HUMMEL puts it, they are there to ‘separate the useful from the harmful’: it may not be the most exciting component in any system, but it is entirely essential because without filters the machine, whether it is part of an automobile, a train or an air conditioning plant, couldn’t do its job – and it certainly wouldn’t have a long life. Mann+Hummel, a German manufacturer with a global footprint, is the largest filtration company in the world, with 80 locations, more than 20,000 employees, and annual sales in the region of $3.9bn. An impressive statistic is that it sells 24 filters every second. The company was founded in 1941 and is still owned by the families of its founders, Adolf Mann and Erich Hummel. Its success can be attributed largely to its domination of the automotive and transportation

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sector. It’s a position gained and held in large part because of the trust it has gained with MANN+HUMMEL brands such as Wix Filter, Mann-Filter, Filtron and Purolator. A wonderful history, however, as Chief Technical Officer Charles Vaillant is there to point out at every opportunity, good is never good enough, and the businesses of the future will not be able to grow with the practices of the past. As CTO Vaillant has a very exciting job – no less than to drive the growth of a traditional manufacturer into a digital-age manufacturer, finding previously unconceived value in products that used to be considered dull. For a start, he says, there are large filtration markets that Mann+Hummel has hardly touched. Filtration is a market worth some $60bn a year, and automotive accounts for only 40% of that, despite the fact that automotive and transportation markets give MANN+HUMMEL 90% of its turnover. “We see a great opportunity for us to take our competence and our capability and apply them in new fields such as life sciences, oil and gas (O&G) and a host of other industries.


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“We see a great opportunity for us to take our competence and our capability and apply them in new fields� Charles Vaillant, Chief Technical Officer

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We can take the competencies that have made us the world’s largest filtration manufacturer and apply them in new fields.” Currently, he says, the company is investing strategically in ‘intelligent air solutions’ for buildings like shopping malls, hotels and offices as well as premises where super clean air is required such as clean rooms, data centers and operating theaters.

If filters are changed too early just because they are done to a schedule, that incurs unnecessary cost. If they are changed too late, damage may result. A smart solution would trigger the change at the right time and you could really optimize your operating expenditure and maintenance cost.” The bottom line is that the filter may be a low-cost item, but by protecting an expensive The filter asset, its value is Looked at one way, intrinsically high. a filter is passive It’s easy to Number of and something underestimate employees at not considered the waste caused MANN+HUMMEL smart, however, by sloppy tools are now maintenance, available catalyze including ‘cleaning’ that transformation. “Combining the filters by reverse-blowing compressed latest smart technology, such as air through them and then refitting sensors, gateways, data acquisition them. Engine damage and warranty and data mining we can build smart problems caused by dust ingestion in filtration solutions. Even at a basic mining trucks or agricultural machinery level example, they can speak to are to be avoided when a replacement us and tell us what is going through engine can cost up to $50,000, not to them, when they need changing, and mention the cost of downtime. A smart what their operating conditions are. filter can save the operator disasters

20,000

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MANN+HUMMEL

Charles Vaillant | CTO Charles Vaillant is the CTO for the MANN+HUMMEL group. He joined MANN+HUMMEL in 1997 and is currently responsible for innovation, new technology research, corporate strategy and corporate ventures. Charles has held a variety of positions in the areas of program management, design and development, product engineering and corporate development. He is based Raleigh, North Carolina. In 2015 Vaillant established i-2-m LLC, a startup company to accelerate commercialization of new MANN+HUMMEL technologies in the fields of clean air, clean water, energy and life science. During 2016 he created an IoT Lab in Singapore, at the Heart of Singapore’s start-up ecosystem, to accelerate the digitalization of company products. Later in the year he launched MANN+HUMMEL Corporate Ventures, an initiative to make strategic investments in Technology Startups with a focus on Silicon Valley. Vaillant earned an Automotive engineering degree from LTR Eiffel (France), a Masters in Industrial Marketing from ESIDEC (France) and an M.B.A from the University of Michigan Ross Business School (USA). He lives with his wife and two daughters in Raleigh, NC USA.

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“Once fitted Senzit will connect directly to the network wherever

you are in the world” Charles Vaillant, Chief Technical Officer

like this, Vaillant says. “In construction, mining and agriculture, three of our key markets, they are working in the dustiest conditions imaginable. They get through a lot of filters and they really don’t have a good way to know when to change them.” Smart filters are no longer pie in the sky. In November 2017 at CES in Las Vegas MANN+HUMMEL launched its new digital product Senzit. It measures data such as the status of the air filters of agricultural and construction machines in real time and transmits the results to the user’s mobile device. The smart device creates added value for users by displaying the load status of the air filter as well as its remaining service life and machine hours completed.

It is convenient, saves time, reduces maintenance costs, protects the engine and makes it possible to utilize the full capacity of the air filter. “There are 10 sensors within Senzit,” enthuses Vaillant. “It measures pressure, humidity, temperature, and it has GPS and 2G/3G connection. Senzit is installed directly at the service port of the air filter housing and is suitable for almost all vehicles and all air filter brands, even older ones. Once fitted it will connect directly to the network wherever you are in the world and stream the data to the cloud. From the cloud we push the data back, after we have run some machine learning algorithms, either direct to the customer or to a web portal – it’s their choice.”

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We turn GREAT IDEAS into REALITY We are a dedicated engineering company with global connections. We source out, and manufacture innovative AI and IoT projects, either from start-up companies or established corporations. We have experts in the ďŹ eld of engineering development, supply chain networking, and manufacturing, as well as other hardware resources. We ensure creative ideas can become reality, and eďŹƒciently deliver the products to the market, whilst also protecting IP and quality. We also have an in-house investment fund, as well as external venture capital partners that invest into selected start-ups.

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USA

Thanks to Senzit, it is no longer necessary to manually inspect the air filter to determine the degree of contamination. It makes it possible to plan maintenance in advance, reduces machine downtime, protects the engine and prevents unnecessary filter changes. Originally conceived as a smart filter, Senzit’s horizons started expanding as soon as it was launched. “Because I know the pressure in the filter I know when the engine is on and when it is off, and because I also have a GPS chip on it I can now provide the users with valuable information. I can provide them with a list of all the trips that the vehicle has done, when they started, when they stopped and where they went. So you have a fleet management component as well. That makes this digitization very interesting for us. By talking to the customers and engaging them we understand their needs and challenges and we are able to provide them additional services in order for them to run a better business. For example, some of the people that we talked to are using very big pickup trucks that they don’t move much. They use auxiliary power to work lifts,

drills and the like. Now they can go on the Senzit app to input an alert that will tell them when the truck has run for more than 50 hours and remind them to change the oil or the belt for example. Many customers are running old machinery that has none of the latest technology built in. Senzit turns these into connected vehicles, and we are adding an anti-theft component so they can see when a machine is moving when it isn’t supposed to.” It’s a revolution, no less. “IoT is really changing the nature of our company,” Vaillant continues. “It’s analogous with the digital service that you get from Amazon or Netflix or connected cars. These are things that are making our lives easier and more convenient. What we are trying to do here is provide the same level of customer satisfaction and convenience to our customers that operate in the harsh environments.” By leveraging data from climate and allergists, MANN+HUMMEL is currently developing smart filters that will make life easier for asthma and hay fever sufferers, for example. “FreciousSmart is analogous to

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the way the company works with agriculture,” he explains. “We are pushing out individual algorithms for every machine, taking into account the different type of dust and the different weather conditions. A great benefit of digitization is that we can customize products without having the cost of developing separate products. It’s about using big data and machine learning and converting the raw data into useful information like how many hours of safe operation they have left.” The internet of things in action Developing smart filters may have been Vaillant’s original objective, but digitization goes much further. “The other piece is the data that we have at our disposal now. On the one side we can have our engineers design better products now that I am collecting data from equipment all over the world. I can see how my product is performing in a real-world environment. In the past we were working with very small samples – today, every single filter can be part of my test fleet. Over the past 75 years MANN+HUMMEL was using mainly lab data to confirm a product performance. Today,

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analytics and data science are a major part of our work and a new skill set for a company like us.” As global CTO, Vaillant is responsible for a team of developers working on a comprehensive range of digital solutions, from sensors and interfaces to cloud programs. At the hub of this effort is MANN+HUMMEL’s IoT lab in Singapore. At this facility, system, hardware, firmware and software engineers and data specialists are working on the development of intelligent technology for filtration. The focus is on intensive cooperation with established technology groups and startup companies. “We have between 15 and 20 people at Singapore, and we are running out of space because we’re growing so fast. The world is our sandbox. We decided we want to be close to our customers, to research centers and universities. By doing this you run a very decentralized organization. Most of our people in Singapore speak Chinese fluently; they are in the same time zone as China and there’s now an extension of our IoT lab in Shenzhen, China.”


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“IoT is really changing the nature of our company� Charles Vaillant, Chief Technical Officer

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Within a couple of months Vaillant will find himself in Silicon Valley, Shenzhen, Singapore and Germany, with brief stops at his North Carolina base catching up with reports from his team around the world. He is in Silicon Valley a lot as leader of startups and the venture arm of the company. “We are a traditional manufacturer and you could think that Silicon Valley is only about Tesla and Apple, but we need new materials and smart sensors and you find this in Silicon Valley as well. The world is changing

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at a very rapid pace. Large marketleading corporations like us have been doing the same thing for a very long time and really need to reinvent themselves. We need the courage to experiment with a completely different way of working, and I think IoT is a really great vehicle to show what can be done. Digital companies are able to bring out new products in a very short time compared to, say, automobile manufacturers. Cellphone companies show that it’s possible to roll out a new product every six or 12 months, not


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MANN + HUMMEL is building its new technology center in Ludwigsburg

every five years. That is a big challenge and I think a lot of corporates are struggling with it. At MANN+HUMMEL we have the luxury of a leadership and shareholders that are fully backing us to experiment with new things. They understand that speed is of the essence and time is now!” So how exactly does IoT speed up product development? It’s a matter of escaping from standard manufacturing development processes that are very successive in style and adopting an agile way of working. “I know a lot of people

are using the word agile as a tagline, but what I am talking about is sprint methodology,” Vaillant says. “When we develop IoT products we launch new features in a two-week sprint, check and validate over another two weeks, then start again – so every four weeks we are able to bring new features into our products.” It’s a departure from traditional German product development principles. Minimum viable product (MVP) rather than perfection is the principle. From the start of the Senzit project to commercialization took just 12

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“When we develop IoT products we launch new features in a two-week sprint” Charles Vaillant, Chief Technical Officer

months, including pilot testing, prototyping, ramp up, manufacturing and the launch of the product. “Now we are launching lots of new features. The hardware stays the same but we build on added value in sprints to optimize and enhance the offering to our customers.” That methodology delivered a sensational new anti-pollution technology platform, “the Fine Dust Eater”, is now being trialed in Stuttgart and soon to be seen on the streets of Bangalore and Shanghai. The World Health Organization estimates that 7mn premature deaths a year can be put down to air pollution. In Germany, it’s 47,000. The company has developed applications which are designed

to reduce the pollution caused by particulates. A filter installed on the roof or on the underbody of a vehicle retains particulates from the ambient air. A brake dust particle filter minimizes the release of brake dust to the environment. The vehicle occupants are protected by an NO2 fine dust combi filter. The idea is to improve the air quality in cities by sucking up the ambient dust – if enough mobile and static units can be deployed. We do not know yet the impact these technologies will have, but as Vaillant says “if you try nothing you will not get anything. If your company core competence is to remove the useful from the armful, then it is your duty to come up with answers, isn’t it?”

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YAMANAGOLD

and the

DIGITISATION of ETHICAL

GOLD SOURCING

Through the advent of the G-Coin, backed by a blockchain supported Responsible Gold solution, Yamana Gold is transforming the sourcing of gold Written by Dale Benton Produced by Glen White


Make Every Day Your Best Day of Production

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Connected Plant

© 2018 Honeywell International. All rights reserved.


We work with miners to improve their operational effectiveness and business performance. Honeywell provides to the mining industry control systems (DCS-Distributed Control Systems, PLC-Programmable Logic Controllers, SCADA-Supervisory Control and Acquisition systems), process historians and collaborative information software like automated production reports and statistical production reconciliation, advanced controls especially in grinding and flotation, remote support, surveillance and operations of assets, and fleet mobile equipment health monitoring.

Honeywell Connected Plant is a suite of applications that delivers higher levels of safety, reliability, efficiency and profitability. These unique industry solutions are based on decades of domain knowledge and controls experience.

solutions to ensure safe and secure operations.

Honeywell is a leading supplier of automation solutions for the process industries, including mining, metals and minerals. The core competency of Honeywell is automation which is at the leading edge of new technologies and innovation, many of which have been deployed at Yamana Gold mines.

Yamana Gold has a diverse set of mines and operations, as well as a range of IT and automation technologies. Honeywell adds depth and skills to collaboratively deploy and sustain best practices in a way that results in faster, more informed decision making, safer operations and reduced operating costs to Yamana Gold.

Honeywell has been providing automation technologies and services to Yamana Gold for more than 12 years. It has delivered control systems for its plants, software for automated reporting of production and several

As a partner, Honeywell has grown the relationship to deliver additional business value through advanced technologies, like collaborative information systems.

In working with Yamana to replicate best practices across its asset base while exploring new technology and solutions that help them achieve their cost objectives, Honeywell

www.honeywellprocess.com/iiot

ensures that Yamana has an automation partner that understands its needs and can assist in the process of digital transformation while delivering and sustaining long-term business value. Yamana Gold and Honeywell look at ways to broaden the relationship by leveraging past experiences as well as the many ways industrial digital transformation can improve business performance. By exploring ways to turn data into actionable insight to optimize operations, predict plant failures and eliminate unplanned downtime together achieving a new level of consistent high performance makes every day the best day of production. The intent is to make Yamana Gold more competitive and productive while Honeywell gains from having a deeper, committed level of business.


YA M A N A G O L D

T

he world of mining is changing. Historically known as an industry lagging behind when it comes to the implementation and deployment of technology, over the course of the last five years the mining conversation has turned towards innovation. One of the biggest conversations in mining, throughout history, surrounds the sourcing and supply of raw material, and now a number of companies are investing into technology solutions in order to track, trace and ethically manage its mineral supply chain. One such company that looks for innovative solutions to mining challenges is Canadian gold producer Yamana Gold. The company’s vision states its intentions clearly – to mine precious metals profitably and responsibly. It is this focus on responsible mining that has driven the company to partner with Emergent Technology Holdings to implement an innovative blockchain solution for the responsible sourcing of gold, making it the first in the industry to

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partner with the American firm. “We are not the only ones working on supply chain solutions in the gold sector, but in our view, this solution, in particular, is unique; it adds significant value to both us, as industry participants, and more so to people in communities where we mine and buyers, consumers and investors of precious metals. On the one hand, it leverages blockchain technology to execute supply chain contracts between miners, refiners, logistics providers and buyers in what has historically been a very manual and inefficient process with data recorded across disparate systems and several industry participants. This solution is certainly an improvement. And, perhaps more importantly, it leverages this technology to track and trace the provenance of gold from mine to vault, providing virtually absolute assurance that the gold produced through this supply chain solution is responsible gold, complying with the strictest due diligence standards including the World Gold Counsel’s Conflict-Free Gold Standard. There’s a market for that. We are starting to see pent


CANADA

up demand for responsibly-sourced gold from jewellers, electronics manufacturers and even fund managers who have long been driving and promoting socially conscious and responsible agendas. With Emergent, and other supply-chain participants, we have developed an ecosystem to essentially guarantee that production flowing through it is 100% responsible

gold. Now, we and Emergent, hope to populate this ecosystem with as many supply chain participants as possible” says Tony Cina, Senior Vice President, Business Administration, Yamana Gold. “This is an industrywide solution. It is not exclusive to Yamana. If a participant contributes to responsibly-produced gold, then we encourage their participation.”

“Through this ecosystem, we will continue to

mine gold ethically and responsibly with the benefit of more efficiently ensuring that all of our gold is conflict-free” – Tony Cina, Senior Vice President, Business Administration, CPA, CA, ICD.D

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“Tracing gold from the mine site right into a vault, and then ultimately to a currency that you can spend across the world or to transfer money. That, for me, solves a real problem” – Tony Cina, Senior Vice President, Business Administration

“So ideally that means every miner, every refiner, every logistics partner and everyone in the entire precious metals supply chain joins the ecosystem; and Emergent is talking to all the major market players aiming to secure their participation. It is in everyone’s best interest to have one ecosystem that buyers, consumers and investors can depend and rely on. This is a unique opportunity for the gold sector to band together to further contribute to the improvement of social and humanitarian conditions in remote areas” Yamana Gold will utilise Emergent’s Responsible Gold Platform, the

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only permissioned blockchain that tracks responsibly sourced gold from its origin through to the end buyer. Along with supply chain partners, Yamana Gold will use a secure mobile network that scans smart chips in tamper-proof seals to record transfers of custody and other data on the Responsible Gold blockchain. “We had a unique interest in the supply chain element of gold production,” Cina says. “We saw the potential to employ an innovative solution to an industry challenge and we recognized the benefit in developing that solution through collaboration.”


CANADA

Yamana Gold first worked with Emergent Technology back in 2016, and this partnership is part of a larger strategy whereby the company has sought out new ways of implementing technology and innovation to refine its operations. As technology continues to shape the world of tomorrow, Joe AbiDaoud, Vice President, IT at Yamana Gold, understands that the very nature in which a mining company must operate is changing. “It’s no secret that every company in the world is becoming a technology company,” he says. “We work in a very cyclical industry that will forever

go through ups and downs, and what we’ve begun to see in recent years is companies understanding that in order to stay competitive, they need to start doing things differently.” And doing things differently is exactly what Yamana Gold has been doing as it undergoes a significant technology transformation. But, as AbiDaoud notes, innovation and technology not only change the practical, physical element of mining, such as the automation of equipment, but innovation is almost driving the strategic thinking and direction of organisations. “The industry as a whole has

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H OCH S CH I L D M IN IN G

SPROTT MINING INC


YA M A N A G O L D

been undergoing a significant transformation for quite some time,” says AbiDaoud, “albeit at its own pace and perhaps a little slower than others. This comes down to the cyclical nature. Gold prices plummeted in 2013, and it forced everyone to rethink our operating model. “Technology is one component of that, it’s not the only component but over time it has become more and more integral to the way in which Yamana Gold achieves success and will continue to deliver value.” AbiDaoud entered Yamana Gold in 2017 with a core mission to drive innovation and seek out opportunities to leverage technologies to provide value and to support the overall vision of the company, which is to mine precious metals profitably and responsibly. For AbiDaoud, three core pillars define innovation: people, process, and technology. When organisations think of innovation, they often focus largely on the technology aspect, while AbiDaoud believes the people and the processes are more important. “For some they seem to fail to

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recognise the important impact and role that people and process have to play in helping your organisation innovate,” he says. “Technology can’t move forward if the people and processes don’t move forward with it, so it becomes fundamentally about changing the way we work and the way we operate. Technology in the end is just a tool to do that.” The people element to innovation should not be understated, especially in an industry that has largely operated in the same manner for decades. Technological innovation breeds a cultural change, but as any transformation has shown, cultural change is no walk in the park. Part of that challenge is communication. Yamana Gold approaches this a little differently. “We actually don’t have a technology conversation,” says AbiDaoud. “When you’re speaking about innovation, or doing things differently, we don’t even talk about technology. It’s about talking about business outcomes in a language that’s understandable and relevant


CANADA

to the end user’s business. That’s how you get a much more engaged partner at the end of the day.” As VP of IT, AbiDaoud has lived and breathed technology throughout his entire career and so it may be easier for him to say that due to his extensive experience. But it is a feeling shared by Cina, as he sees Yamana Gold’s approach to technology centred much

more around efficiency and effectivity, rather than seeking out problems. “We work with our operations and exploration teams to better understand what challenges they face and together consider whether there are operational or other technologies that could be deployed to resolve those challenges. Our approach is targeted. We do not introduce

“The industry as a whole has been undergoing a significant transformation for quite some time, albeit at its own pace and perhaps a little slower than others” – Joe AbiDaoud, Vice President, IT

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CANADA

RESPONSIBLE GOLD BLOCKCHAIN SUPPLY CHAIN TECHNOLOGY BY EMERGENT TECHNOLOGY

solutions and then look for problems for which to solve. The solutions are very specific. They either solve a problem or create an opportunity” says Cina. “That’s why we try not to have discussions focused entirely on technology. It’s about how we can become more efficient; how can we produce more ounces both profitably and ethically. It’s about working with our strategic partners and seeking out areas of opportunity, to which we then work collaboratively to find a solution.” The partnership with Emergent Technology and the implementation

of the company’s Responsible Gold blockchain platform is but one shining example of Yamana Gold’s approach to technology, but it is not the only one. Yamana Gold has invested in Emergent’s “G-Coin”, a digital token backed by physical gold sourced from the Responsible Gold supply chain platform. “The conversation started a few years ago from a group consisting of technology experts, fintechs legal experts and gold market participants to look at the possibility of digitising gold,” says Cina.

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“We were invited as the only gold supply-chain representative.” “While initially we were not clear on where the discussion would lead, we quickly caught on to the concept of a digital gold currency that was backed, and had its value supported by, conflict-free gold.” This was a novel concept a couple of years ago. Today it’s a lot more real. And tomorrow even more so. G-Coin, first and foremost, is not a cryptocurrency, it is digital gold. It provides a digital certificate of ownership to physical gold stored in a secure vault, opening access to responsible gold as an investment, wealth transfer vehicle and payment mechanism.

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As AbiDaoud admits, it’s not an answer to a business problem, it’s an opportunity to open up efficiency and profitability, all the while remaining committed to responsible, ethical gold sourcing. Cina adds: “It is not the only digital token of gold in the world, but what makes it different is that it is more than just a digital store of value. It


CANADA

can actually be used as a medium of exchange to settle transactions or transfer value. That’s where it’s unique. I don’t know of anyone else that’s using responsible gold to back a viable digital currency. “Tracing gold from the mine site right into a vault, and then ultimately to a currency that you can spend or transfer to individuals and businesses

across global markets - that, for us is innovative.” Cina went on to say that “since the beginning of time, gold has been a store of value. With blockchain technology, gold can now be digitized; you can own it in your digital wallet and no longer have to hold physical gold. But what does the digitization of gold really solve if all you have done is alter the form in which wealth is stored?” Cina argues, “not much. But when you introduce the ability to spend and transfer gold as if it were cash, instantly,

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CANADA

with zero transaction fees and in the smallest of denominations - that is a real solution. That’s innovative” Cina believes that the case for G-Coin is especially feasible in emerging markets, where currencies are more sensitive to inflation and currency devaluation and in some cases subject to currency controls. “The introduction of a gold-backed digital currency becomes extremely appealing to individuals and businesses in those markets”. Users will now have the ability to convert their local currency into the G-coin and protect their wealth and purchasing power. Through the Responsible Gold platform, and the advent of G-Coin, the mining landscape is well and truly on the cusp of great change. The demand for conflictfree gold has already begun to surge over recent years, with more and more participants looking to change the way in which they purchase and acquire gold. But what does the future truly hold for the ethical sourcing of gold? Cina feels that, in actual

fact, we could see a whole new gold asset class. “In 5-10 years, or perhaps less, as demand for responsible gold continues to increase, responsiblegold emanating from this ecosystem may become a new and distinct asset class, demanding a premium to gold otherwise produced. This bodes well for the sector, its participants and for the people in areas where we mine precious metals.” This is why we got involved: good for gold and good for society – profitably and responsibly.” Yamana Gold started this journey of digital transformation in 2016, but with technological innovation there is never truly an end to that journey. The official launch of G-coin is targeted for the third quarter of 2018, with the back-end technology already in place, but where does Yamana Gold go from here? “With everything in place with regards to that launch date, the goal for Emergent is to introduce and integrate G-Coin into payment walls and wallets in those emerging markets,” says Cina. “Emergent expects to process approximately $2

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“There is great opportunity for us as an industry to become much more collaborative and unified in our approach to innovation” – Joe AbiDaoud, Vice President, IT

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CANADA

billion in transactions and payments in these markets over the next year and are looking to have G-Coin become a widespread alternative to traditional payment methods, ultimately pushing gold to become the most liquid asset in the world.” For AbiDaoud, the future is one of possibility and collaboration. “There is great opportunity for us as an industry to become much more collaborative and unified in our approach to innovation,” says AbiDaoud. “What I’d like to see is an ecosystem that all industry participants are a part of, with real benefits to everyone. That would be a tremendous accomplishment for the mining industry.”

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ACCENTURE

HOW ACCENTURE IS CHANGING THE FACE OF PROCUREMENT


Kai Nowosel, Accenture’s Chief Procurement Officer on his approach to an everevolving and increasingly vital business function Written by ANDREW WOODS Produced by RICHARD DURRANT


ACCENTURE

“THE DEFINITION OF PROCUREMENT IS NOT ‘AM I A BETTER NEGOTIATOR?’ IT IS MORE, ‘AM I THE BETTER ECOSYSTEM MANAGER?’” — K ai Nowosel, Chief Procurement Officer, Accenture

K

AI NOWOSEL, A HIGHLY experienced procurement professional – formerly of Sanofi and Deutsche Bank – is currently the Chief Procurement Officer (CPO) of global professional services giant Accenture, and he has a burning ambition. “I want to break the mould of traditional procurement,” he says. We caught up with Nowosel at Accenture’s 220

May 2018

Kronberg office, roughly a 20-minute cab ride from Frankfurt, where he sets out a detailed vision for the very future of procurement. His ambition is to see it transformed from a traditional back office function into an area much more closely aligned with the top line. “Where I want to really take the procurement function at Accenture


EUROPE

Click to watch our talk with Kai Nowosel, Accenture’s Chief Procurement Officer, on his approach to an ever-evolving and increasingly vital business function.

is very clear. I want to transform it into a full business enablement function,” he says, easing back into his seat. “But to do that, I need to understand what’s out there. What is on their (the businesses’) mind every day and how can I support them to become more competitive? “We have heard a lot, and have read a lot, about business partnering,” he

says, ‘but for me, it’s really not a single point of content or contact. It’s a single knowledge pool of understanding. It’s about translating procurement and supply market opportunities in order to correlate them into business. That is business partnering, for me. So, it’s not like I am a caretaker. No. I want to sit at the table and have creative input on the commercial side of supporting w w w. g i g a b i t m a g a z i n e . c o m

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The Intelligent Edge for Strategic Procurement: Third Party Risk Management By Lee Kirschbaum Senior Vice President Product, Marketing, and Alliances, Opus

A simple definition of the word “procure” is “to obtain by particular care or effort.” Ask any strategic procurement leader, and he or she is likely to agree: particular care or effort is exactly what it takes to manage suppliers in today’s challenging financial and regulatory climate. Business is increasingly interconnected, with unprecedented levels of global trade and capital flows. The potential for corruption and data breaches escalates daily. Regulations like the General Data Protection Regulation (GDPR) demand compliance, and financial viability is an ongoing concern. And there’s the constant need to reduce risk and maximize value across suppliers. Underlying all these challenges is the intense reliance on third parties, such as traditional suppliers, vendors and contract manufacturers, agents, brokers, distributors, resellers, franchisees, affiliates and more. Far beyond the remit of traditional procurement, companies today depend on hundreds, often thousands, of third parties to complete core business functions, delivering 60% or more of a typical company’s revenue. Third parties are a major engine of growth, yet also pose major risks: • 56% of businesses experienced a third-party data breach in 2017 • 60%+ of all data breaches are third-party related • 75% of all anti-corruption enforcement actions are due to third parties To drive value and performance while optimizing costs, strategic procurement professionals must not just manage spend and onboard third parties, but also have a plan to address these risks — from bribery and corruption to performance to information security to financial health to reputational risk and beyond — across all their third parties. It’s a tall order, yet ultimately a company — and by extension procurement — is responsible for the actions of its third parties. That’s why forward-looking strategic procurement teams are taking their supplier and third-party risk management seriously. Through systems and processes to actively monitor third parties, strategic procurement can lower costs, drive value and improve overall performance.

Third Party Management: A Risk-Based Approach Third party risk management helps answer a few seemingly simple yet critical questions: who am I doing business with, what risks do they pose and how do I successfully manage those risks?

It’s the process by which organizations select, onboard and monitor their external relationships with third parties for risk. New risks emerge regularly, so it’s also important that businesses and procurement teams keep a constant eye on their third parties. Companies and procurement teams without a program in place for monitoring third parties for risk expose their organizations to significant regulatory, financial and reputational repercussions. They’re also at a significant disadvantage when it comes to growth opportunities. Effective third-party risk management programs establish a comprehensive view of all third parties and manage each based on risk levels. This includes maintaining an inventory of all third parties and keeping track of documentation, such as contractual agreements, workflows, risk audits and assessments. The goal is to identify potential threats before they occur. Start by determining the most pressing sources of risk and then direct the bulk of your effort toward mitigating those risks, beginning with these fundamental questions: • Who are your third parties? • What services do they provide? • Which introduce the most risk and are most important, what are their specific risks, and how can any risks be mitigated? Once you have identified your company’s risks, another risk management best practice is to develop an up-to date, realtime inventory of all your company’s third parties. The inventory details the nature of each relationship and its risks, such as third parties with access to sensitive information who are sharing your data with their own contractors. The inventory must also be monitored — risk isn’t static, and neither are your relationships. Identifying all relationships across your organization, gathering necessary information on each and effectively assessing their risks can be extremely time-consuming and complicated if done manually. An automated technologybased approach, such as that provided by Opus, allows your business to free up its resources so that you can focus on what you do best. Nothing worth doing in life comes without risk. It’s how you manage your risks that can make or break your business. By making third-party risk a business priority, strategic procurement teams can drive value from third parties, reduce risk and safely guide their organizations into new areas.


Case Study: Intelligent Third Party Management in Action at Accenture Operations As a case in point, the gold standard in strategic procurement, Accenture, turned to Opus for support managing third party risk. Accenture Operations — a business function of the leading global professional services company serving clients in more than 120 countries — is reinventing business operations through industrialized business process expertise, technology, applied intelligence and data. Procurement is one of the Business Processing Services (BPS) offered by Accenture Operations, reinventing procurement from source-tosettle — embedding robotics process automation, market intelligence and analytics, and exceptional business process expertise into the process and augmenting existing resources, so Accenture and its clients can move first in the market and accelerate results. The Procurement BPS team helps operationalize supplier management functions to facilitate continuous improvement, drive compliance and mitigate risk. The BPS team manages more than $168 billion in spend, 23,400+ projects and 87,300 contracts per annum across 380+ Procurement BPS clients and Accenture. Because of this, Accenture works with literally thousands of suppliers and third parties, and needed a robust, automated, reliable technology solution to help identify, assess, manage and monitor third party risk. As a result, Accenture is partnering with Opus, leveraging their award-winning third-party management SaaS platform, Hiperos 3PM, to support their Procurement BPS services. Accenture selected this solution for its: • Comprehensive functionality • Offering maturity • Financial services and industry expertise • Ease of client and technology integration Most important was Opus’s ability to create turnkey functionality called accelerators — such as a banking, GDPR or ABAC (anti-bribery / anticorruption) accelerator. The key to strategic procurement is efficiency. By offering templates and models that could be reproduced quickly, Hiperos promised quick time to value. Today, Accenture is actively managing its third parties and recently added functionality to bolster third-party compliance with the General Data Protection Regulation (GDPR), going into effect in May 2018. As the organization helps its clients prepare reinvent business processes with “intelligent operations” that harness talent, data, and intelligence to deliver the right information where and when it’s needed, it also can rest assured it’s covered one of its most significant risk factors — and opportunities — third parties. Now that’s, well, intelligent.

Put the strategic in strategic procurement. Free your business from third party risk. Global business today depends on third parties, from suppliers to contractors to vendors and more. As reliance on third parties increases, so do the risks — from data breaches, corruption, compliance and financial health and more. But so do the opportunities. Free your business to manage the risks and realize the opportunities. Learn more at opus.com/procure Free Your Business®


ACCENTURE

“…WE SHOULD NEVER FORGET ABOUT THE RELATIONSHIP COMPONENT, AND THE HUMAN COMPONENT” — K ai Nowosel, Chief Procurement Officer, Accenture

the business. That’s one vision. “The second vision is linked to the moment you’re sitting with the business and identifying new opportunities and optimising current initiatives and delivery,” he explains. “But to do that, you also need to understand what is currently delivered. So, you need to get much closer to the business. At Accenture, we call it ‘rotating to the New’. If you want to be more agile, you

need to be faster. You need to be smarter in anticipating things, because just running a process faster doesn’t make you better. To anticipate what’s happening, and to already include that into your process, makes it much easier to work with a procurement function – you already have a solution before the concrete demand really happens. So, I want to drive my function into something of understanding and


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prediction rather than reaction.” The third vision in Nowosel’s procurement manifesto lies in the collation and utilisation of big data. “And that is where I need technology and digital. I need the co-worker. I need the data, and I need, last but not least, access to the right content at the right point. That is probably one of the biggest things. Today a lot of effort is spent creating static content, and that is

where I want to move away and say: ‘Our differentiator is not creating that content. Our differentiator is giving access to the right content.’ So, you need to understand the business to have the right access to the right content and, you need to have the right data understanding to really correlate and identify the right content by basically enabling it with the right rules, and with the right channels.” w w w. g i g a b i t m a g a z i n e . c o m

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ADDING VALUE OF DIVERSITY & INCLUSION IN SUPPLY CHAINS

For over 10 years, we have been dedicated to the mission of improving diversity in entrepreneurship and driving inclusive procurement. We believe that supplier diversity is an economic and moral imperative. Innovation comes from a diversity of perspectives, so when we limit who can contribute, we in turn limit what problems we can solve. Join our global network of diverse entrepreneurs, supply chain leaders, thinkers and doers and realise the power of differences. Look out for more as we expand into Europe with Germany as first stop in 2018!


TRANSFORMING SUPPLY CHAINS THROUGH INNOVATION & INCLUSION We prefer “variety” in our pastimes, “biodiversity” in our ecosystems and “diversified” holdings in our portfolios, yet we unconsciously resist diversity in our social and professional communities. This has become a liability in today’s marketplace, costing companies talent, growth & innovative solutions. From your workforce to supply chains; diversity & inclusion of people and ideas are critical drivers for further growth in your organisation. We must move past the tick box exercise, truly embrace diversity, and commit to applying it. Looking out at the business landscape today, it’s clear that diversity is increasingly being valued in its true sense by companies that thrive to improve productivity and profits — and outperform the competition.

WHY YOUR SUPPLY CHAIN IS RIPE FOR DISRUPTION? As we embrace the new digital world that is driven by technological advancement, innovation takes centre stage in every corporate strategy. There is strong evidence that innovation mostly comes from small businesses and individuals, which makes diversity a critical factor to bring new solutions, breakthrough technology and disruptive businesses to market. Diversity within supply chains can not only bring new ideas and solutions to your organisation, but it also brings competitiveness, and boosts market growth. Beyond these commercial benefits, there is the BIG social value supplier diversity brings -

reducing socio-economic inequality and creating stronger, more stable communities. With many global business leaders finally waking up to the positive impact it brings, businesses that understand how to use this to their advantage will stand to gain a competitive advantage and genuinely make positive contribution to a more fairer society. At MSDUK we are delighted to be working closely with Accenture - and especially delighted that we share similar core values. Together our mission is to rewrite the book on inclusive procurement and encourage diversity as a catalyst for innovation and growth. In partnership with Accenture, we are launching the Innovation Hub – a launchpad for ethnic minority businesses that have an innovative idea, solution or product to bring to the market. And through our extended ecosystem of the Knowledge Hub and Growth Hub, we offer an integrated programme of activities, processes and networks to bring those ideas to life and help these businesses scale-up and access global markets. We all have an opportunity right now to embrace diversity as a competitive advantage, examine our own unconscious biases and proactively look for ways to bring different voices to our team and into our decisions. Let your supply chain be the gateway to innovation, embrace diversity and inclusion to unlock hidden potential and give opportunities to the business leaders of tomorrow that represent modern Britain as it is today; multicultural & diverse!

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INNOVATION | KNOWLEDGE | PROCUREMENT | BENCHMARKING


ACCENTURE

MAN AND MACHINE Nowosel can see a day when man and machine will work as one. “We need to rethink the way we use systems,” he says. “It’s not just the user interface. The intelligence in the system needs to recognise me. It needs to say: ‘Hey, I know you have already purchased something. I know you’re sitting in this type of business. I guess you’re currently looking for these types of buys. This is what’s relevant for you to be

successful.’ So, it’s less anticipating the right product and much more anticipating the right demand by understanding the business. And that is a very different user interface than just making it a little bit more web-based and smartphone enabled. And for me that is one of the biggest things I would really like to break and move away from. I want to take a very traditional process flow and transform it into something that is an

Click to watch Kai Nowosel talk about his approach to work with partners and business enablement within Accenture including their use of new technologies.

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intelligent portal solution that really guides people to the right channels, seamlessly and intelligently.” Does Nowosel ever envisage a time in the future where we could have an AI CPO? “When I worked in consulting, I wrote a point of view on the ‘organisation of one’. And yes, it was a provocation, and I don’t think it will ever happen, because in every business you run, whether it’s procurement, whether it’s marketing, whether it’s

sales, whether it’s R&D, we should never forget about the relationship component, and the human component. But will the role, or will the processes that we are currently performing, shift? For sure, they will. Can an artificial intelligence machine negotiate as good as a human being? I’m 100% convinced they can. We’re seeing it already in the stock markets where we already have machines to machines. So why shouldn’t it happen in a quite common negotiation? But that’s why I’m saying that procurement is moving to something else. The definition of procurement is not ‘am I a better negotiator?’ It is more, ‘am I the better ecosystem manager?’ Or, ‘am I the better window to innovation?’.” It is possibly easy to theorise regarding future systems and processes, but is Nowosel currently putting these words into practice as CPO at Accenture? “Absolutely. That’s where our big partnerships sit, and where our benefit – where my benefit – is. I am sitting in a company that basically invents digital solutions for implementation. I have access to all that.” Accenture has just released a new w w w. g i g a b i t m a g a z i n e . c o m

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DOING BUSINESS WITH WOMEN IS GOOD BUSINESS

We believe diversity promotes innovation, opens doors, and creates partnerships that fuel the economy. We believe a diverse and inclusive corporate culture integrates women at all levels of the organization, from the C-suite to the warehouse floor. That’s why we are dedicated to fostering diversity in the world of commerce by identifying, certifying, and facilitating the development of women-owned businesses.

The Women’s Business Enterprise National Council (WBENC) is a U.S.-based non-profit organization focused on women’s business development and sustainable economic growth. We are the largest certifier of women-owned businesses and a leading advocate for women-owned businesses in corporate and government supply chains. Our Corporate and Government Members with best-in-class diversity and inclusion programs recognize that partnering with womenowned businesses is not just about equality and fairness – it’s about making better business decisions.

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OPPORTUNITIES We provide education, programming, events, and networking opportunities for women-owned businesses, diversity and inclusion experts, government and corporate procurement professionals, and other industry and thought leaders. From our signature events to executive education programs, we are dedicated to connecting women-owned businesses and our Corporate and Government Members in meaningful ways, as well as providing the programs and resources that enhance business development and growth.

JOIN FORCES. SUCCEED TOGETHER. Learn more at www.wbenc.org

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RESOURCES To address the challenges many small businesses face in building and growing a business, we provide support and resources through the full life cycle of entrepreneurship. Our goal is to ensure women business owners have access to the education, support, and tools they need to grow and succeed.

ENGAGEMENT Our theme is Join Forces. Succeed Together. because we know that success is only possible when we partner with our constituents toward a set of common goals. We foster healthy engagement through advisory councils, ambassador programs, and a robust recognition and awards program, including our annual America’s Top Corporations for Women’s Business Enterprises award.

WBENC Board Chair Theresa Harrison and WBENC President and CEO Pamela Prince-Eason present Kai Nowosel of Accenture with the 2017 America’s Top Corporations for Women’s Business Enterprises award.


The Women’s Business Enterprise National Council is proud to partner with leading corporations like Accenture to help break the mold of procurement by recognizing and promoting best-in-class diversity and inclusion practices. Because we know supplier diversity is about more than corporate responsibility — it’s a propelling economic force.

Supplier diversity is

Learn more about WBENC and how we partner with the world’s leading corporations at www.wbenc.org

a propelling economic force.

PROUD BUSINESS PARTNER OF ACCENTURE


ACCENTURE

procurement offering which Nowosel is visibly excited about as a practicing Chief Procurement Officer. “Because this is more than source to pay – which is not all that sexy. We call it Procurement Plus. Procurement Plus gives you a little bit of an indication that our procurement function has a vision that goes beyond a traditional procurement function, that also gives you an understanding about the size of the organisation.” So, what exactly is in the ‘plus’?’ “From a Procurement perspective, I run all venture and acquisitions on a due diligence side and on the commercial synergy side. So, that in itself is already a big team. In the past three years Accenture has completed roughly 70 acquisitions, that is a lot of work to integrate and to bring it into the right process and supplier panel. And we are buying more and more diverse portfolios. So, in the past we bought a lot of IT and now that we own a lot of agencies, we even budget for things like hair, makeup and other logistics for photoshoots and so on – it’s getting quite diverse. So, V&A to M&A is one. I also run all accounts payable, so I really have a P2P responsibility in that logic. 232

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“I also run something which is extremely close to the heart of where I see Accenture and the function going, and that is Supplier Inclusion and Sustainability,” continues Nowosel. “So, I run all our corporate social responsibility agendas that are attached to our supply chain. I also run the contractor business – one of the biggest categories I oversee. I basically do all the contractor onboard identification, onboarding, background checking


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MANAGING RISK

442,000

Number of Accenture employees globally

1989

Year founded

$34.85bn Revenue

and qualifications – that is something that you typically would not see in a procurement function, but that you could potentially see in an MSP (managed service provider) setup. It’s so close to our core business and is essentially the revenue driver. As a result, my team is larger than the traditional benchmark If you think about what is known as traditional procurement, it’s probably around double the size of a traditional benchmark.”

Nowosel is also keen to pinpoint the safety features of Accenture’s offerings. “It is extremely relevant that all the partners we are working with are following a very rigid process, a very clear playbook on how we assess and handle risk and controls,” he says. “Not only on our side, but with all the parties we are working with. Some of the players are much smaller, and therefore, we had to enhance the risk framework to something that is not just for the ‘big is beautiful,’ but also for the smaller, dynamic startups that probably have a completely different mindset. With regards to the size of the organisation that I’m running, I’m operating in 69 countries, so I can really claim it’s a global function. It’s definitely a global governance model I’m running.” Obviously, the role of the CPO has changed a lot over the years and the issues CPOs are presenting to Nowosel have also shifted. “I would say it’s not just them coming to me, it’s me, coming to them, with all the issues. I think the role of procurement has evolved big time. If you go back a little bit in CPO history, what have we always focused w w w. g i g a b i t m a g a z i n e . c o m

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“THE ISSUE NOW IS HOW DO YOU FIND THE RIGHT PARTNERS IN THE ECOSYSTEM? HOW DO YOU MITIGATE THE RISK? HOW DO YOU PROTECT THE BRAND? HOW DO YOU GET COMPETITIVE?” — Kai Nowosel, Chief Procurement Officer, Accenture

on is how will we put enough control, compliance and negotiation power into the process? And I don’t think that is what the issue is anymore. The issue now is how do you find the right partners in the ecosystem? How do you mitigate the risk? How do you protect the brand? How do you get competitive? And getting competitive is more than having a great negotiated price. It is having the right solution for your customers at the right point. So, I see procurement moving very strongly

away from a control and compliance and into a business function. “One of the biggest discussion points I have with myself, but also with my peers in the market, is: What is our value proposition going forward? What is our reason of existence going forward? And how do we measure our impact?” “I talk a lot to my peers. ‘What’s your experience with this supplier? How do you approach this type of category?’ I don’t find that too exciting. I find it much sexier to think about how we combine w w w. g i g a b i t m a g a z i n e . c o m

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“I SOMETIMES SAY THAT PROCUREMENT IS THE TINDER OF INNOVATION… BECAUSE IT MAKES PROCUREMENT SEXY AND I WANT TO GET INTO THAT MODEL OF BEING SEXY INSTEAD OF BEING A BACKOFFICE FUNCTION” — Kai Nowosel, Chief Procurement Officer, Accenture

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categories – how do I manage an ecosystem? How do I manage to come to a solution? I sometimes say that procurement is the tinder of innovation. I like the word ‘tinder’ because it makes procurement sexy and I want to get into that model of being sexy instead of being a back-office function. I want to have an impact, and that’s probably what I talk most to my peers about. How do we really see our repositioning?”

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KEPPEL DATA CENTRES ARRIVES IN THE GERMAN MARKET 238


Written by Dale Benton Produced by Lewis Vaughan


FOLLOWING THE ACQUISITION OF A DATA CENTRE IN FRANKFURT, KEPPEL DATA CENTRES IS LOOKING TO DISRUPT THE GERMAN DATA CENTRE INDUSTRY

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raditionally across the global colo-data centre industry, power generation, location and cooling systems have dominated the conversation as to what can make a data centre partner of choice. But over the last few years, that conversation has started to change. No longer is it enough that a company can provide unrivalled cooling efficiency, greater capacity than any other and it’s even arguable that being strategically placed may not be enough to separate one company from another in competitive markets. For Jens Peter Mueller, Country Head / General Manager for Germany at Keppel Data Centres Holding, the key is in the additional value that a provider can deliver. “Companies won’t buy from you just because you have all of the traditional qualities; cooling, power, space, security, fire suppression,” he says. “Don’t get me wrong, all those traditional qualities are still key, but as a provider you need to offer additional value on top of those commodity issues.” Keppel Data Centres is the manager and operator

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The vision is to be the number one partner of choice for enterprise customers from certain, security- and proximity demanding verticals” Jens Peter Mueller Country GM


Jens Peter Mueller, Country GM

of premier data centres across AsiaPacific and Europe. Mueller, having worked with Deutsche Telekom, was brought into Keppel DC to oversee the company’s expansion into the German market, which was solidified by the acquisition of its first data centre in Frankfurt Kalbach earlier last year, Keppel DC Frankfurt 1 (KDC FRA 1). Mueller believes that where Keppel

DC is different from other data centre providers in Germany is in its approach to grow fast; the company acquires existing data centre sites rather than opting to build from scratch or take over competitors. “That is something different because if you own the sites, that’s not the end of the story because you need to have much more than just

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Keppel Data Centres’ Datahall, Germany

the site,” says Mueller. “You need to have a brand, a service portfolio, you need market access and you need to have an organisation.” Getting to that point in Germany is part of the journey for Mueller. Keppel DC has an existing strong presence across the APAC region and its presence, particularly in Singapore (a data centre hub), provides the company with an ever-growing list of international customers. As the company seeks to firmly establish its European footprint, Mueller understands the core

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challenge in this different market. The European data centre market is densely populated with some of the biggest players in the industry, many of which have been active on the continent for the last decades and, in order for Keppel DC to catch up, it requires a certain economy of scale, proven “IP-Gravity” and the ability to create an eco-system within your customer base. “The vision is to be the number one partner of choice for enterprise customers from certain, securityand proximity demanding verticals,”


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Keppel Data Centres, Germany.

says Mueller. “But we are aware that in order to catch up and overtake the ‘big names’ of the market, we must bring our organisation up to that level and then we look to do something new, something disruptive like offering fully transparent TCO to that customer group upfront.” Growing with customers will prove key. As Keppel seeks out to acquire new data centre sites, it will look to establish a varied portfolio of large scale customers that it can host, while also targeting the enterprise market. This is where Keppel will

establish a state of the art service and connectivity portfolio, as Mueller is not the first to admit that a data centre is now much more of a marketplace. “Compare a data centre with an airport,” he says. “The going in and out of planes is just the basic functionality, but it’s all about the people. What do they need when they head to other countries? They need services and everything to make their journey pleasant and successful. That’s what Keppel DC brings to the table with its portfolio spanning Europe and Asia Pacific.”

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GROSS CAPACITY

40 MW 244

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WHITE SPACE

10,000 SQM

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LEADERS IN ELECTRICAL ENGINEERING STS Group provide electrical engineering, instrumentation, design and commissioning services across Ireland, the UK, Europe and the Middle East.

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Compare a data centre with an airport. The going in and out of planes is just the basic functionality, but it’s all about the people. What do they need when they head to other countries? That’s what Keppel DC brings to the table with its portfolio spanning Europe and Asia Pacific” Jens Peter Mueller Country GM

Like all airports, a data centre can only be as good as its connectivity options and in Frankfurt, KDC FRA 1 is connected to DE-CIX – the largest internet exchange in the world. As a DE-CIX enabled site, Keppel can now play in the “major league” of Colo-Datacenters in Frankfurt. “Having the biggest Internet Exchange Point (IXP) on our site not only allows us to connect our customers to hundreds of carriers all over the world plus to all relevant cloud platforms in the market. It also enables us to attract cloud-ready customers with a hybrid IT-architecture to our sites,” says Mueller. “And being a part of the largest exchange in the world, it’s like sitting on a big switch where a customer can connect to just one port, and on the other side of that switch are all the peering partners and cloud-platforms of his choice, readily connected and available to exchange traffic. This option is accompanied by Keppel DC´s unique business model of not charging the customers for cross-connects on a monthly basis” Keppel’s German expansion is of course a journey and Mueller readily admits that the customer base is still growing, but what does prove key is the company’s access to the APAC regions, specifically Singapore. With a footprint across five countries in Europe and many places in the APAC Region, Mueller believes that customers will be attracted to Keppel DC as the organisation can be a gateway to Asia for

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Keppel Data Centres utilises one of the most efficient cooling systems in the industry w w w. g i g a b i t m a g a z i n e . c o m

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their own expansions into that growing market. “We can be in the eyes of customers a very valuable partner because we have all the businessconnections across the APAC regions,” he says. “It goes back to our idea of growing with the customer. We can really take their business to places like Singapore, Malaysia, Australia and Hong Kong and connect them to our expansive customer base.” As a data centre provider, Keppel will be nothing without its customers and as it continues to grow and expand its customer portfolio, it can do so with the support and collaboration of its existing vendor base. In acquiring an existing 40MW/10.000 sqm data centre site from a financial institution in Frankfurt, Keppel took it upon itself to turn the site from a single tenant data centre into a multiple tenant site. This, Mueller describes, is like looking at the difference between a house for a family and a hotel. “You don’t have to have everything in your private household that you would need for a hotel,” he says, “and it’s the same when taking over a data centre that has already been built according to other plans. “Besides from having a strong foundation in the existing setup and a clear plan how to adopt to enterprise needs it is important to have other partners that are familiar with the rules of the data centre business, that know what the challenge is and that can serve you on an international basis.” In this instance, partners that have proved instrumental on this German expansion have been

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Being a part of the largest exchange in the world, it’s like sitting on a big switch where a customer can connect to just one port, and on the other side of that switch are all the peering partners and cloudplatforms of his choice, readily connected and available to exchange traffic” Jens Peter Mueller Country GM


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Keppel Data Centres has invested heavily in its back-up power system to support its ability to provide an Uninterrupted service w w w. g i g a b i t m a g a z i n e . c o m

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STS-Tecom, CBRE and WISAG, all providers of professional and innovative data center services “Those companies go above and beyond what you ask for,” says Mueller. “They see issues that need to be resolved and work fast, effectively and collaboratively in order to provide a smart solution. “As we embark on this growth journey, having partners that can provide that level of innovation and collaboration will continue to prove instrumental.”

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At the time of writing, Keppel is very much at the start of this growth journey in Germany. Having finalised the acquisition of its Frankfurt data centre at the end of last year, and an official operational date earmarked for July 2018, what does the future hold for Keppel in Germany and beyond? Mueller feels that the current data centre market in TIER 1 cities across the world is dominated by the likes of Google and Facebook, responsible for close to 40% of market growth in 2017 alone. This, he believes,


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will change the customer demand across the data centre market. “We will see more and more businesses being hooked up to hyperscale platforms,” says Mueller. “This part of the market will grow further, mostly in built-tosuit environments - but there will always be an important customer base demanding an enterprise offering with proximity to the cloud. “So, you could argue that we may lose some customer groups being soaked up by hyperscalers,

but at the same time we will maintain customers that need to run mission critical services and they will always focus on top notch, highly secure and hyperconnected data centres, which is what we have in our portfolio. “Take all of that and throw in the fact that we can deliver a connected platform with those larger regions like Asia and Singapore, and we will become a key player for any business looking to expand their own reach,” concludes Mueller.

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Using technology to transform the QSR experience Written by Dale Benton Produced by Andrew Lloyd


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McDonald’s Sweden is overhauling its IT infrastructure, placing the restaurant experience at the project’s core

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he very nature of the multibillion-dollar global quick service restaurant (QSR) industry is changing, and technology is the driving force. For Anders Westling, IT Director and CIO of McDonald’s Sweden, over the course of the last 20 years through a number of digital, technology and management consultant focused roles, he has seen first-hand just how much the IT function has changed. “When I started, IT was seen as the responsibility of the tech guys who would deliver technology in bits and pieces,” he says. “If you wanted to deliver solutions within a company, you’d have to bring in many different vendors and you had to have in-house development in order to be able to deliver the requested services.” As IT has become more mature, with companies boasting much more mature IT infrastructure, the “bits and

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pieces” model of approaching IT and technology has begun to disappear. “More and more vendors have understood that IT can be delivered as a service, a one stop shop,” says Westling. “It becomes less of a technology conversation based on ‘what’ technology we need and centres much more around ‘how’ the business can be developed and how technology can support that.” Westling joined McDonald’s in 2015, having been headhunted based on his strong experience in the IT space. His task? To restructure what he described as a malfunctioning IT infrastructure. His first observation was to look at how McDonald’s IT function supported, or in this instance isolated itself, from the delivery of McDonald’s services to its customers. Westling notes that as an organisation, McDonald’s was “more or less automated”, with the


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A self-ordering automated kiosk at McDonald's

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Putting Digital Innovation at the core of McDonald’s Business. Experience the Capgemini Effect www.capgemini.com


MCDONALD’S IT infrastructure operating almost entirely separate to the business function. As technology advanced, and the perception as to what IT could do to support and enhance an organisation, this old model was hindering McDonald’s in Sweden. The challenge for Westling was to speak to more than 40 franchisees across Sweden to understand their pain points with IT and, more

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importantly, begin to understand how to implement solutions to fix them. “I also looked at the organisation and how we should reorganise ourselves to meet the businesses demands and to find the right resources to enable us to do so,” he says. “That became a case of looking at and understanding close to three years’ worth of resources inside a timeframe of around two months.


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McDonald’s has introduced automated kiosks at over 100 locations in Sweden

“We worked in a small team to pinpoint what was considered to be some of the worst areas, and overall I’d say this took about nine months in total before we began to see noticeable improvements in our delivery.” As we enter Q2 of 2018, three years into a seven-year transformational journey, Westling can already point to significant progress. Across more than 100 restaurants throughout Sweden, McDonald’s has

introduced a new production system (Made to order) that is powered through self-service order kiosks. Running alongside this, the company has also launched a mobile application in which customers can utilise promotions and will soon be able to order and pay before they arrive, and only recently it even introduced table service at a number of its franchisees. “Table service has been very much appreciated by our guests,”

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Westling says. “The new service will be rolled-out in a rapid pace in Sweden. McDonald’s Sweden will also launch home delivery. First in the Stockholm city area but other cities will follow soon.” These changes represent the notion that the technology conversation is much more focused on how you can develop your service delivery. “What has happened is that we are now more able to focus on new services and trying to establish a new restaurant experience for our customers,” says Westling. But Westling admits that this has been a process that has required patience, a direct result of that

malfunctioning infrastructure. Part of the challenge for Westling centred around McDonald’s working with a large number of IT vendors, and so he set out to streamline those vendors and work with what he describes as “critical partners”. “Our franchises are planning to be in business for the long run and so we need to have partners that possess the muscles and the strength to be right alongside us in both the good, and the more challenging times,” he says. “Our partners must understand our business and the challenges ahead, be involved in our planning, share industry and technology insights with us,” he continues.

“We worked in a small team to pinpoint what was considered to be some of the worst areas, and overall I’d say this took about nine months in total before we began to see noticeable improvements in our delivery” – Anders Westling, IT Director and CIO of McDonald’s Sweden 266

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“The relationships that we forge with these partners is crucial as we work together on a number of levels. We need to be able to place the implementation of technology and operations into their hands, while simultaneously being able to work on a practical level in order to develop a roadmap together.” Creating that roadmap has been a significant part of the journey to date, both internally across the franchises and of course with those critical partners. This roadmap would identify what activities and plans were in place for the future of McDonald’s and how Westling could incorporate IT services and technology into those plans. This, he feels, meant that the early stages of this transformation were dedicated to “getting the lights on”. “Those first six to nine months were centred around getting this journey up and running, putting the implementations in place,” he says. “We were having meetings with the franchises, explaining what we were doing and working internally on establishing IT services. There were many different areas that

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42% 42 PERCENT OF DINERS WOULD USE SELF SERVICE ORDERING KIOSKS IF AVAILABLE we had to work on in order to improve the overall IT delivery.” As the company continues to develop, Westling admits that it’s an ever-evolving process. Towards the end of 2016 and throughout the second quarter of 2017, he admits that the organisation spent around 85% of its time “keeping the lights on”, with the remaining 15% spent on businesses development and implementing new initiatives. “At this moment in time, I’d say its now 65% on keeping the lights on,” says Westling. “But it is a continuous journey, and this will


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only continue to change as we move into the future and continue to implement this IT infrastructure and new business capabilities.” “A significant expansion of the number of restaurants in the Nordic region is waiting - 100 new restaurants in the Nordic countries over the next five years and 200 in 10 years,” he adds. ”We serve 150 million guests a year and the vision is to reach 200 million a year in the Nordic region. This will require us to step up and deliver reliable restaurant operation and at the same time conduct

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many critical projects with a lot of digitalisation and technology involved.” With technology transformation it can be easy to forget the key driving forces behind such a significant journey. For some it could be keeping up with competitors, for others it could be identifying and enabling greater cost efficiencies. For McDonald’s, the driving force has and forever will be the guest. As technology continues to redefine the QSR industry, the guest has undoubtedly changed with it. In the digitally enabled


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70% IN THE US MARKET, QSR’S ARE SEEING AS MUCH AS 70 PERCENT OF THEIR OVERALL BUSINESS COMING VIA THE DRIVE THRU LANE

world of today the guest expects a certain level of accessibility and efficiency through technology. To that end, Westling believes that the guest journey and experience is running alongside that of McDonald’s in parallel. “I think the guest journey and experience is changing all the time. I mean, we have a quite competitive market in Sweden with a number of existing fastfood brands and new players are entering the market with new and different technologies,” he says.

“The biggest competitors are the ones that have spent a lot of energy in developing the customer journey like we are at McDonald’s and in that regard, the restaurant experience is changing overall.” Westling stresses the importance of understanding that it’s not a case of trying to reinvent the restaurant experience, rather it is one that develops to suit the ever-changing demands of what a guest expects from the restaurant experience. “It’s not all technology, it’s also, at the end, how we run the restaurants,”

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he says. “We need to run great restaurants and the technology needs to support that. We can’t create a great restaurant, we’ve got to understand the importance of how we run the restaurant to establish the restaurant experience of the future.” But what comes first? Does McDonald’s listen to the guest and then implement? Or does McDonald’s define its own technology and restaurant experience and the guest follows suit? For Westling, he’s not too sure if it’s the “chicken or the egg”, admitting that there is a sense of collaboration as guests come from different restaurants in different countries and expect the same level of experience to be had in McDonald’s, regardless of where it is.

But he also stresses that the company approaches it from its own viewpoint and being a part of the larger McDonald’s corporation proves key. “We’re trying to understand our guests, but we are also learning from other markets and other countries,” says Westling. “We look at other markets to see how table service or self-service order kiosks work and how that can shape our own experience. “As a large company operating in a number of different countries around the world, it really helps us implement new services very rapidly. Sure, the customer experience may be different in Denmark, or Norway, but a kiosk is a kiosk. “It’s more about how technology can support the guest journey in order to

“It’s more about how you implement the guest journey into the technology in order to deliver a great customer experience. That’s what’s more important” – Anders Westling, IT Director and CIO of McDonald’s Sweden w w w. g i g a b i t m a g a z i n e . c o m

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deliver a great customer experience. That’s what’s more important.” It’s all well and good striving to deliver the best possible restaurant experience, with innovative technology supporting it, but this cannot be achieved without high quality staff that understand this changing landscape. McDonald’s spends a significant amount of time investing in training and educational programmes to better enable its staff to understand and be able to utilise the new technology. As Westling himself admits, working in restaurants now is so much more

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than simply “greeting the guests”. “It’s continuous work and we spend a lot of time on training,” he says. “We are working with and educating all levels of staff to increase the knowledge and understanding of technology. We’re working in many different areas to increase the knowledge and understanding of how the experience is changing.” Technology is a continuously evolving beast. The technology and the IT infrastructure that McDonald’s has already implemented today could be obsolete, or at the very least


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Anders Westling IT Director and CIO

Anders Westling has many years of experience in senior positions in internationally operating Retail and FMCG organizations. Westling has also worked as a Management consultant for larger organisations to implement service management, deal with “emergency projects” and to carry out major organisational re-structuring, digital initiatives and change management.

lagging behind the market demand in as little as six or twelve months’ time. Westling points to the importance of having that roadmap and close collaboration with the restaurants, business functions as well as those critical partners as key to remaining ahead of the curve. With more opportunities to be more digitally enabled, Westling believes that the key thing to understand is to be exactly where the guests are and not to be where McDonald’s feels it ‘should’ be. “We have self-service order kiosks, we have mobile apps, we are now

implementing table service and home delivery,” he says. But Westling concedes that the most important component, is focusing on the guests restaurant experience and how technology can better enable that. “We need to improve and free up more time for our employees though digitalisation to allow them to spend more time with our guests,” he says. “I think that’s crucial and it helps us improve the way we listen to our guests. That will define our future and exactly how we continue to implement technology into our restaurant operations.”

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Delivering light rail in Denmark’s third TO OPEN IN 2020, THE largest city DUE LIGHT RAIL SYSTEM ODENSE Written by FRAN ROBERTS Produced by LEWIS VAUGHAN

LETBANE WILL REVOLUTIONISE TRAVEL IN THE CITY. MOGENS HAGELSKAER, CEO, EXPLAINS MORE


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U R OPE HAS AN extensive number of tramway networks, although Melbourne in Australia boasts ownership of the world’s largest tram system. All the former communist countries of Central and Eastern Europe, excluding Lithuania, the Republic of Macedonia, Montenegro, Moldova and Slovenia, have extensive tram infrastructures. Many cities closed their tram programmes last century due to the rapid increase in traffic. However, in recent decades, tram networks in countries including the UK, Ireland, France, Germany, Spain and Portugal have grown considerably. Denmark is the latest country to re-embrace the tram – 45 years since the last tram ran in Copenhagen, a new tram system is being constructed in Odense, in addition to one in Aarhus. Following the Odense Letbane Construction Act in spring 2015, the construction company Odense Letbane P / S was established. It is 100% owned by Odense Municipality, but acts as an independent company. Perhaps most famous as the birthplace of the author Hans Christian 278

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A final layer of concrete being poured, before tarmac is added on Albani Bridge Andersen, Odense is hoping to become a global leader in sustainability. “It is a very green city and a very blue city as well,” acknowledges Mogens Hagelskær, CEO at Odense Letbane. “Of course, from an environmental point of view, we are obligated to look into how can we reduce the CO2 or emissions in any way. How can we re-use braking energy? How can we utilise solar cells on top of the roof of the control room centre?”


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“FROM OUR PERSPECTIVE, THE TRAMWAY IS THE MOST IMPORTANT PROJECT OF ALL OF THEM BECAUSE WE ARE COMBINING THE SINGLE STRATEGY TOWARDS A HIGHER SCALE AND WITH THE INFRASTRUCTURE” – Mogens Hagelskær, CEO

A DANISH CITY ON THE RISE The tram system is part of a wider regeneration scheme in Odense after the city was hit hard by the global financial crisis. “15 years ago, there were a lot of industrial areas in Odense but due to the financial crisis they were closed,” explains Hagelskær. “The former Mayor and CEO of the municipality, together with the city council, decided that instead of just slicing their way out of it by cost cutting,

they wanted to invest in the city.” The planned total investment in urban development from 2012 to 2022 is DKK 44bn (US$6.8bn). As a result of this, 38,000 new temporary jobs and 10,000 new permanent jobs will be created. US$6.8bn may be a small amount compared many other projects – London’s Crossrail project is scheduled to cost US$23bn – but in Danish terms, it is a considerable investment. “Odense is moving from a medium w w w. g i g a b i t m a g a z i n e . c o m

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sized city to a great city in Denmark,” Hagelskær notes. “It’s not only enough to have a city. You need culture, you need sports, you need good shopping and restaurants, you need education, you need transport. “All these things are handled in the one big overall strategy of getting to a greater city and they are all projects attacking the same three principals – that is attraction, growth and transformation of the city. Of course, from our perspective, the tramway is the most important project of all of them because we are combining the single strategy towards a higher scale and with the infrastructure.”

TRANSFORMING ODENSE The overall strategy of making Odense a great city is one that Odense Letbane is determined not to lose sight of. “The tramway scheme in Odense is being built in four legs. It is our vision of the tram that it is supporting the overall city vision. All in Odense need to be careful because it’s not the end goal to deliver a tramway. It is just a step to the end goal. The end goal is to make to transform of all of Odense,” observes Hagelskær.

Construction began on July 1st 2015 and then mayor, Anker Boye, cut the first section of tarmac To support the overall objective, Odense Letbane envisions that it will support development work in Odense generally and especially within 400m of each station. “We know that there will come a lot of investment, we see it already. We support new infrastructure and we are integrating and strengthening the public transportation infrastructure, both the existing railways and the highway,” states Hagelskær. From the public transportation point of view, Odense Letbane is also supporting and transforming the bus system.

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POWERING YOUR 360° SOLUTIONS COWI is a leading consulting group that creates value for customers, people and society through our 360° approach. We tackle challenges from many vantage points to create coherent solutions for our customers.


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transport challenges in the coming years. On the outskirts of the city, a new university hospital and science campus are under construction, and the existing university is planning to double its capacity over the next couple of years. “By 2024, we can see that more than 60,000 people on a daily basis will travel in and out of that area. That is approximately the same as a medium sized city in Denmark that needs to go in and out of an area. We cannot do that with the existing infrastructure,” acknowledges Hagelskær. “Second of all, we have an ambition

in Denmark that it will only take one hour to come from Copenhagen to Odense and one hour from Odense to Aarhus, the second largest city in Denmark. If that is going to be realised then we will be looking at double the amount of people coming in and out of Odense station on a daily basis. That means that we will have a lot of congestion in that area.” Many solutions to these challenges were proposed but, in the end, the tramway is the one that Odense is going with. “The tramway will carry more than four buses and more than

“WE HAVE AN AMBITION IN DENMARK THAT IT WILL ONLY TAKE ONE HOUR TO COME FROM COPENHAGEN TO ODENSE AND ONE HOUR FROM ODENSE TO AARHUS, THE SECOND LARGEST CITY IN DENMARK.” – Mogens Hagelskær, CEO

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200 cars worth of passengers each time that it enters the stations,” Hagelskær comments. “On top of that, of course, there are a lot of extra benefits and developments that come with urban development. But actually, the core objectives and the core business case are in the capacity of the tramway.”

LESSONS LEARNED In August 2012, the competition for the design and visualisation consultancy for the Odense tram system was won by a team consisting of Niras, PLH Architects, Atelier Villes & Paysages and MBD Design. In March 2015, Parsons Brinckerhoff won the contract for project management, and strategic and economic advice. COWI was selected as technical advisor. Following on from that, in June 2015, preparatory work began involving the city’s water and sewer pipes – work that will be hard to do once the rails are in place. “We are actually taking a risk out for the big contractors by doing all the utilities diversions. That is from lessons learned from programmes in the UK where they have tried to do it at the 284

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The utilities diversion has had a big impact and all along the tram line the utilities have been updated to modern standards, whilst the water supply and sewer system has also been upgraded to better accommodate heavy rainfall

“WHEN YOU LOOK INTO HOW WE’RE GOING TO BUILD THE TRAMWAY, WE HAVE DIVIDED IT UP IN A VERY LOGICAL WAY” – Mogens Hagelskær, CEO same time and you are always surprised by what’s happening under the road,” notes Hagelskær. The tramway project has been split into four different construction phases. “When you look into how we’re going to build the tramway, we have divided it up in a very logical way,” Hagelskær observes. After the utilities are moved, the roads, bicycle lanes and pavements will be built. Then after that the tracks, the masts and the stations. Finally, the focus will be on greenery. “We’re


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planting one or two trees every time that we are removing one,” adds Hagelskær.

COMPETING ON EFFICIENCY In the beginning, Odense Letbane decided to tender out the project as DBOM – design, build, operate and maintain. However, it quickly became apparent that there would be a lack of competition, driving up prices, as few companies could deliver all that was required within the tender. It was then decided to split the civil works into

individual packages, as well as packages for the transport system and the rolling stock. The contract for rolling stock has been awarded to Stadler. “We now have divided the whole alignment in the civil works into seven smaller packages because we can see that in Denmark it was too large a scale of packages for one contractor, and we couldn’t attract international civil workers or construction companies to come and do that for us,” acknowledges Hagelskær. “To have the highest competition possible, we divided them into certain packages. We have done the detailed design so our contractors are competing on the efficiency that they will provide in the construction phase. Right now, we have tendered up five out of the seven packages and we will have received the last two packages before 1 March.”

NEW MONEY The first of 16 Variobahn trams is expected to be delivered by Stadler to Denmark in autumn 2019, while the whole fleet is scheduled to enter service by the end of 2020. Despite being almost three years away, the w w w. g i g a b i t m a g a z i n e . c o m

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Odense tram project is already attracting developers to the city. “We can see already that a lot of developers are attracted to Odense, even developers we haven’t seen in the city before,” Hagelskær comments. “There’s actually new money coming into the city here, and what we see from other projects is that a tramway is a generator for growth – there will be urban development. Not only the ones that we had planned for already, but also new ones that we wouldn’t have seen coming before. It means that the municipality must treat the tramway as strategic to their overall planning.” It is hoped that investment will flow into Odense with new businesses developing along the route of the tram. In 2010, a modern tram line opened in Bergen, Norway, and Odense Letbane uses this project as a point of comparison. “At this point of time in the project, there were approximately DKK 17bn [$2.6bn] invested near to the tramway tracks and that is similar to us here in Denmark. We have approximately DKK 15bn [$2.3bn] in investment within a 400m radius of the tramway right now,” remarks Hagelskær. “The challenges that we are facing is that an

“THERE’S ACTUALLY NEW MONEY COMING INTO THE CITY HERE, AND WHAT WE SEE FROM OTHER PROJECTS IS THAT A TRAMWAY IS A GENERATOR FOR GROWTH, THERE WILL BE URBAN DEVELOPMENT” – Mogens Hagelskær, CEO urban tramway as we’re building in Odense, there are very few people in Denmark with experience of building a tram like that.”

GAINING COMPETENCE This lack of experience of building tramways in Denmark has certainly been a challenge for Odense, although neighbouring countries have been sources of inspiration. “Building a tramway in the city centre, that is something new in Denmark,” Hagelskær comments. “We haven’t seen that from past history, so the capacity of the competence is very high for us to gain. We do of course get a lot of inspiration from how they’ve w w w. g i g a b i t m a g a z i n e . c o m

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done it in the UK, France, and Germany.” In all Danish towns and cities, cycling is one of the most common means of transport. According to the country’s official website, it is estimated that there are more than four million bicycles in Denmark and more than 10,000km of designated cycle tracks and routes. As the tram system takes shape, care must be taken to manage the space available for traffic. “The pedestrians and bicycles are using the same space as we are building on, so there’s a lot of congestion. You see people are stopped in their cars but there’s a lot of things that you need to balance when you’re doing this. You need your alignment to work for your construction site, but you also need to take into the account that the city must function when you are doing the construction,” Hagelskær acknowledges.

COORDINATION AND COMMUNICATION There will be 26 stations on the line from Tarup in the north to Hjallese in the south. At 14.5km, the first phase of the tram system extends through much of Odense. As well as ensuring that the city can function during construction, Odense Letbane must also take into

It is estimated that there are more than four million bicycles in Denmark account other projects that are happening in the city. “We need to have a lot of mutual adjustment, coordination and communication together,” explains Hagelskær, referencing the aforementioned university and hospital projects. “The city needs to be facilitators to the common investment. That means that we are actually adjusting or balancing a lot of bottom lines in a project like this. That is not a simple job to organise.”

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consideration for Odense Letbane, and is reflected in how the management team operates. “We are very focused on the fact we are dealing with other people’s money. It is public funded. We make an effort. When we do things, we don’t cut corners to make decisions. When we make a deal, it is a deal and we work through it. We are setting the direction as the management team and are clear in our communication to our employees,” Hagelskær comments. “From my point of view of what we have done here is we have focused on

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the organisation part. The leadership, clarity and principles. We are looking very much to cultivate a performance culture, and we are making huge efforts to not only promise a lot of things but also putting it into practice. From the organisational perspective and the focus, we have managed to have an independent board with only nonexecutives,” observes Hagelskær. “That means that they are here to support us. They are skilled in the various disciplines of maintenance, design, good governance, and


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stakeholder management in Odense.” The team built a mission control centre – known as On Track – to help the project stay exactly that. “I thought that we had a lot of management meetings, where we were discussing a lot of things but I thought we weren’t discussing the right topics. I wanted to cut all the filler out of the discussions and then know what is the most important thing to discuss together with my senior management team. It’s a very focused discussion surrounding, so that everyone can

contribute to the success that we are planning, and we will not talk about all the things that are running smoothly,” Hagelskær advises.

INFORMING THE NEIGHBOURHOODS At the heart of all of this is communication. “Communication is very important for me because, at the end of the day, this is Odense’s tramway. It’s not my tramway,” Hagelskær explains. “We will go out there, knock on people’s doors asking them if they feel that there’s any information that

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Mogens Hagelskær (left) discusses the project with a member of the public they want or need from us. If they are not informed they are very easily going to say no to the tramway, but if we have informed them and they say no, then we have a much easier discussion than if they are saying no on an uninformed basis.” From the beginning of the project, Odense Letbane has laid out a clear vision for the project, allowing effective communication to residents about the impact of the tramway, and thus maintaining support for it. “When we are nearing the construction phase, we will have information meetings in the

neighbourhoods. We have divided the tramway route defined areas, and then we will go out there, inform residents about what will happen, when it will happen, and how it will affect them on a daily basis,” Hagelskær advises. When Odense Letbane is undertaking the construction, its staff will also be there on bicycles and with an information wagon. “We will have a very close sense of if there’s going to be any rumours in the areas, so we actually can tackle that as well as giving them the information in the right place,” explains Hagelskær. Press, digital channels and social media are also utilised by Odense Letbane to keep residents informed about the project. “Neighbourhood communication is very important for us. To have that face-to-face communication along the route and using channels such as mobile exhibitions, guided walks along the route or through the outdoor campaign to decorate the w w w. g i g a b i t m a g a z i n e . c o m

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• Odense Letbane is the public company responsible for developing the first light rail line in Denmark’s third-largest city

• I n March 2015, Parsons Brinckerhoff won the contract for project management, and strategic and economic advice.

• Melbourne in Australia maintains the title of the world’s largest tram system

• In June 2015, preparatory work began involving the city’s water and sewer pipes

• 45 years since the last tram ran in Copenhagen, a new tram system is being constructed in Odense, in addition to one in Aarhus

• T he tramway project has been split into four different construction phases

• T he planned total investment in urban development from 2012 – 2022 is DKK 44bn (US$6.8bn). As a result of this, 38,000 new temporary jobs and 10,000 new permanent jobs will be created. • T he tramway will carry more than four buses and more than 200 cars worth of passengers each time that it enters the stations • In August 2012, the competition for the design and visualisation consultancy for the Odense Light Rail was won by a team consisting of Niras, PLH Architects, Atelier Villes & Paysages and MBD Design.

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• T he first of 16 Variobahn trams is expected to be delivered by Stadler to Denmark in autumn 2019, while the whole fleet is a to enter service by the end of 2020 • T here will be 26 stations on the line from Tarup in the north to Hjallese in the south. • At 14.5km, the first phase of the tram system extends through much of Odense


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An important part of Odense Letbane’s communications throughout 2017 was a mobile exhibition, parked around busy public spaces and where construction work was taking place

fence for the construction site,” reveals Hagelskær. We’re making a digital learning concept for the school children as well.”

SELLING THE PROJECT Communication and a coherent vision has played a key role in driving a performance culture at Odense Letbane, which in turn has helped to rally support for the project. “When I’m looking at performance culture, I’m looking knowing what to do when there are challenges so that you will steer out of the fence and not into the fence,” states Hagelskær. “How we dealt with it here in our organisation is that we

are very clear on the vision and we are very clear on the objective of the programme. That was what was certain when we were selling the project to the politicians or to the citizens. At that time, we were very good at defining the vision.” When the tram system arrives in 2020, Odense will no doubt wish to continue emulating Bergen, which has seen a steady increase in passenger numbers, numbers increasing by 2.3% on the previous quarter in Q3 2017, according to Statistics Norway.

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REDEFINING SUSTAINABILITY IN THE DATA CENTRE SECTOR Written by Laura Mullan Produced by Lewis Vaughan


At a time when sustainability is a key talking point in the data centre space, one of Europe’s largest internet companies is blowing the competition away with sustainable data centre operations

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rappling with some of the largest behemoths in the tech industry, in Russia, it’s Yandex which reigns supreme. Commanding 54% of the market in the region, Yandex owns Russia’s most popular search engine which also stands as the fourth most popular search engine globally – yet that’s not all it offers. Some 19mn people log into its online marketplace, Yandex.Market every month and its service, Yandex. Taxi accounts for 60% of Moscow’s taxi rides. On top of this, the Russian firm also offers products like translation services, map services, crowdsourcing tools and more. Right across its portfolio, Yandex strives to make everyday life simple, using data to empower its customers.

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Now the Russian web giant is, quite literally, giving power to citizens, with its state-of-the-art data colocation centre in Finland. Standing proudly in the southern province of Mäntsälä, Yandex’s data centre is a mammoth operation to behold, with five data halls at 500 sqm each.

A sustainable vision More impressive though, is the fact that this data centre is heating the local district’s water by reusing its waste energy. “As a dynamic technology company, we want to lead the way and bring new ideas and new innovations to the industry,” explains Ari Kurvi, the firm’s Data Centre Manager. “For us,


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it’s important to give back to the community and make full use of the excess energy we produce. “Half of the neighbouring urban city’s needs can be fulfilled by our excess heat which is environmentally very impressive, yet this isn’t just about sustainability as there’s also a very solid business case behind it,” he adds. “Therefore, I think it’s important to show the industry that this is doable and to encourage others to follow our lead.” Working alongside local Finnish energy company Nivos OY, the Russian web firm has developed a ground-breaking approach to heat production. The excess heat from Yandex’s data centre is collected and directed through the district heating network to Mäntsälä households. In doing so, the Finnish city has been able to reduce the price of heating and slash its emissions by 40%.

Energy efficiency realised The Mäntsälä data centre is built around an inherent need to drive efficiencies and its state-of-the-art district heating solution is a solid reflection of this ethos. “At the moment, our energy reuse factor is 0.31, which means that 31% of the energy what we take in can be recycled for further use,” notes Kurvi. “We are now embarking on the next phase of this energy reuse installation and through that, we hope to increase our energy reuse factor to

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The utilized waste heat does not burden nature nor wallet Households in Mäntsälä are heated by pictures, memories and data stored in Yandex datacenter. In data parlors 1000 stoves worth of heat is generated every second. Instead of wasting the heat it is collected by Yandex. Nivos, an innovative energy company located in Mäntsälä, recycles the heat into the district heating network in Mäntsälä. “We realized that we won’t get a data center locate to Mäntsälä unless we offer them an innovative and useful operating model. Therefore we studied how both parties could benefit from using the excess heat. When Yandex planned to invest in Finland we offered this type of business concept” Esa Muukka, CEO of Nivos talks about how co-operation started and continues. “And as you can see, the result is outstanding ecosystem between an energy company and a datacenter”

Local, emission-free and cheaper energy – everyone wins Nivos and Yandex were the first ones in the world to recycle waste heat from the data center

to the district heating network on this scale. Half of Nivos’ heating energy now comes from locally generated waste heat. Additionally, in 2017 CO2 emissions fell by 40 %. Because of this venture, Nivos has also been able to lower the district heating prices. “The waste heat is local, no emission, and cheaper than the natural gas from which the district heating was previously produced. When others are pushing for district heating prices, we will lower them: once the cooperation has started, prices have been lowered to customers twice.” Muukka tells. And of course for datacenters this means business. Nivos buys the excess heat on normal commercial terms. So the heat produced by the data center recovery decreases Yandex’s operation cost. “That kind of radical thinking requires a little positive madness,” laughs Yandex Data Center Manager Ari Kurvi. “Fortunately, plenty of courage is found on both sides. Nothing will ever change if you always go down the usual path.”

About Nivos Nivos is a trailblazer in the energy industry. Over the past few years, Nivos has developed an award-winning heat recovery system for a data centre, power grid automation and sensor technology, as well as distributed energy solutions, for example. Tel 019 68 991 | Customer service 019 689 955 Email service@nivos.fi Mäntsälä, Finland

www.nivos.fi/en/Yandex


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around 0.55 or 0.60, which means 60% of our energy will be reused.” Sustainability has become a huge talking point in the data centre landscape, as the facilities are leveraging increasingly more energy. In an alarming report by Climate Change News, the outlet suggested that the communications industry could consume one-fifth of global electricity by 2025. This is something which Yandex is taking seriously and it has many more sustainability initiatives under its sleeve.

exhaust area is,” says Kurvi. “This will also reduce the need for energy for fans on those days when it’s windy. “In a similar vein, the building was designed so that all its interior lights are LED lights, which keeps energy consumption low overall and this is one of the reasons we are best-in-class,” he adds. All of this has culminated to help Yandex achieve a power usage effectiveness (PUE) of 1.15 for the whole site including office buildings, one of the most efficient ratings in the sector.

Unique cooling design

An ideal location

The firm’s Finnish data centre not only boasts a trailblazing heating system, it also has been meticulously designed by engineering firm Royal Haskoning. With a distinguishing aeroplane wing shape, the Mäntsälä data centre has an efficient air-cooling system, which Kurvi says is integral to its energy-efficient standing. “By designing the building in the shape of an aeroplane wing and facing it towards the nominal wind direction, it creates a little bit of under pressure behind of the building where the

The Nordic data centre is just one of over 10 data centres that the Russian firm has across the globe and the choice of location

“This isn’t just about sustainability, there’s also a very solid business case behind it” – Ari Kurvi, Data Centre Manager

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Yandex operates ten data centres around the world

was by no means accidental. “There are many reasons why Yandex felt Finland was a good choice,” reflects Kurvi. “The power quality is very good, the cost of electricity is better than some other western countries, there’s a good availability of skilled labour, and the region’s strong fibre connectivity is also very important. “We use direct air-cooling in almost every data centre we have and, in this respect, the Finnish climate and clean air quality make this location

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optimal as there is cold, clean air available for cooling purposes. “As well as this, the local energy company was very willing to cooperate with us and build this ground-breaking new approach to heat production,” he adds. “In this region, they’ve already lowered the district heat price by 10% because they can reuse our excess heat. In this way, we have a very good citizenship approach. I think we are very well-known and well-accepted here because of this.”


Your business case today

translated in smart data centre space for tomorrow

Royal HaskoningDHV is an independent, international engineering and project management consultancy with 135 years of experience. Backed by the expertise and experience of 6,000 colleagues all over the world, our professionals combine ‘global expertise’ with ‘local knowledge’ to deliver a multidisciplinary range of consultancy services. By showing leadership and innovation in the design of data centres, we are creating solutions for a vital infrastructure in our modern live and empower a sustainable society now and into the future. For more information, please contact: Martien Arts, Director - Mission Critical Facilities T: +31 88 348 6550 M: +31 6 51846333 E: martien.arts@rhdhv.com www.royalhaskoningdhv.com/datacentres


Collaboration is King How a collaborative team approach helped DPR Construction deliver Yandex’s first data center build outside of Russia

Complex mission critical design and construction projects require cross-team collaboration. While there are performance metrics and benchmarks to help guide success, team dynamics can make or break a project. With a short timeframe for design, procurement and execution of its first data center outside of Russia, Yandex quickly realized traditional design and construction processes were not going to meet their needs. They also realized a traditional contractor would not fit the bill. Yandex enlisted DPR Construction, one of the top data center contractors in the U.S. over the past decade. DPR proposed an alternative plan that allowed for the design to be finalized during the preconstruction phase of work. The preconstruction effort took an innovative approach allowing the design to be completed without delaying the construction start. Preconstruction also fostered a collaborative effort between designers, Yandex and DPR, which maximized the design development. DPR implemented a 360° team approach, tying together the entire project team and eliminating silos. The collaborative team approach empowered and improved the speed of decision making by individuals and avoided the old “decision-by-committee” approach. When asked how to best manage and strengthen teams to ensure projects are set up for success, DPR’s Damian Farr outlined six crucial responsibilities for managing a project:

1 gigawatt and counting... Total data center power capacity put-in-place by DPR Construction around the globe to date.

Learn more about DPR’s experience and expertise at

www.DPR.com

1. D  evelop a clear and common understanding of project values and goals. This is the foundation of a truly collaborative project — clearly defined project values and goals that are determined by all key stakeholders. 2. C  learly communicate these values and goals to ALL participants. In addition to clearly communicating values with all participants, leaders must appropriately onboard any subcontractors or consultants, as well as continually reinforce the goals and values to the whole team through repetition and recognition. 3. C  reate a functional physical and virtual space for co-location. To enhance performance, digital networks, collaboration systems and other elements must be established up front. 4. D  efine the necessary project teams/select team members. Teams should be diverse, crossfunctional and have different viewpoints and perspectives. Not only does this diversity provide more information to inform the design, the tension between perspectives stimulates greater creativity. 5. P  rovide training and mentoring for project teams. Training and mentoring should address three task performance issues: level and coordination of member effort; appropriateness of the task and performance strategies the team is using; and degree to which the team leverages all of its members’ knowledge and skills. 6. M  onitor and adjust team dynamics as needed. The team’s strengths and weaknesses should be reviewed and addressed to minimize negative impacts.

ABOUT DPR CONSTRUCTION DPR Construction is a forward-thinking international general contractor specializing in technically complex and sustainable projects. Since 1990, DPR has grown with its customers supporting them internationally through offices in the U.S., Asia and the Netherlands.

DAMIAN FARR Europe Managing Director DPR Construction DamianF@europe.dpr.com +31 618 585 380 (NL) +44 7984 005 725 (UK)


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One of Yandex’s data centres

Operational excellence Like any data centre, operational excellence is at the heart of the Mäntsälä data centre and now, as the company’s data consumption and size swells, Kurvi says that there will undoubtedly be more data centres in the pipeline and, as the industry grows, he says tech companies have a civic responsibility to uphold the highest sustainability standards. “Yandex is growing fast and the demand for data centres is growing. I think we will expand the site or create a new one within the next two to three years or so,” notes Kurvi.

“On top of this, we’re also promoting operational excellence and maintaining the site so it stays in excellent shape. Of course, as any company, we are also reducing costs wherever we can electricity-wise by selling more waste energy and trying to be as energyefficient as we can,” he continues. “We are managing our own IT hardware design and combining that with energy-efficient ventilation and cooling to be the top-class data centre in the world – that’s where our concentration is at the moment.”

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Strong industry ties ‘No man is an island’, and the same can often be said about business. In the ever-evolving tech industry, new innovations are emerging every other day. Therefore, the right collaboration could set you miles ahead of a competitor and arguably no one understands this better than Yandex,     “The business development unit in this municipality is one of the biggest reasons why Yandex decided to switch on its data centre in Mäntsälä,” says Kurvi. “They take care of our needs as well as our future plans and improvement plans.

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“One of our key partners has been MYK Oy, we’ve worked with them a lot to see how we can help the municipality grow, and bring new companies to the city, and in turn, we’re also enhancing our level of services. “Another key player is a company called Calefa Oy, who has delivered the heat reuse system for us,” he adds. “Together we have innovated and built the whole concept and they’ve also provided all the necessary equipment and heat pump solutions. They have been very open-minded and also have really helped us improve our sustainability.”


SERIOUS COMMITMENT IN PROJECTS AND SCHEDULES Telefuusio Ltd (part of Instalco concern) is a responsible-minded contractor specialized in telecommunications network (SCS) and audio-visual systems installation service (AV). We look after providing our customers with long-lasting telecommunications solutions. At the same, we take an active stand in regard to design errors, in case they occur during a project. Area of operation: We operate throughout and, if needed, outside Finland.

www.telefuusio.fi info@telefuusio.fi +358 45 133 0881


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100% uptime Although the firm is embarking on an ambitious sustainability drive, Yandex hasn’t forgotten the core objective of its data centre – to ensure that European projects by Yandex Data Factory, its machine learning and big data division, run consistently, without interruption. Today, ensuring the uptime of mission-critical operations is more important than ever with data centre downtime costing around $8,000 per minute, according to an in-depth study by the Emerson Network Power and the Ponemon Institute. Therefore, 100% uptime isn’t just a whim, it’s a necessity. “We have a lot of backup power generation onsite and have power reserves in case of emergencies,” Kurvi notes. “We also have an agreement with the Finnish national grid so they ensure the grid is stable. “It’s very important because we need to make sure we have 100% uptime for the company,” he adds. Since 1997, Yandex has delivered market-leading information services with over 53mn users logging into its services every month. The

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Russian web giant is presently one of Europe’s largest internet businesses and it expects sales growth to accelerate this year, forecasting that its consolidated revenue will be between 25-30% in 2018. With such imminent growth on the horizon, Kurvi is optimistic about the firm’s future, and the example it will continue to set in the data centre industry. “Where do I see Yandex in five years?” reflects Kurvi. “I hope that the Mäntsälä data centre will have doubled or tripled in size from what we are today. I would like to see us stand as one of the world’s most ecological and best-driven data centres from both a sustainability and operations perspective. I hope that our downtime will remain 0% and uptime 100%.” “Yandex is a very technical and competent company when it comes to designing and operating data centres. We are very innovative and we’re going in a direction where no one else has been. In that sense, we want to be known as a leading technology company and a leading data centre business.”


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“I would like to see us stand as one of the world’s most ecological and best-driven data centres” – Ari Kurvi, Data Centre Manager

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Developing digital tools

for the modern

banking age Written by Catherine Sturman Produced by Kiron Chavda


Investing in new digital tools has transformed Virgin Money’s service offering, putting the customer in control. Chief Information Officer, James McGlynn, tells its technology story

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igital disruption is impacting every business sector, not least of all financial services. Increasing customer expectation has seen the emergence of new technologies to meet the growing demand for greater control and flexibility in the way that people manage their finances. This shift has led financial institutions to transform traditional ways of working and invest in new solutions to remain competitive, deliver a frictionless customer experience, drive down costs and enable future business growth. “Customers expect to be able to manage their finances whenever and wherever is most suitable for them and technology is the key to

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meeting and exceeding their expectations,” explains Chief Information Officer of Virgin Money, James McGlynn. An electronic engineer by background, McGlynn witnessed how the 2008 financial crash led to the subsequent acquisition and merger of financial institutions and the emergence of ‘challenger banks’, creating a seismic shift in the financial market. This disruption has also been supported by the development of new digital tools designed to make banking increasingly seamless, with new services devised specifically around the customer experience. “You could argue that in a future Open Banking market, three things will become increasingly important for


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banks. Firstly, what your brand stands for and the customer experience that underpins it,” notes McGlynn. “Then how you gather and protect data. And finally, delivering customercentric propositions to make people’s lives better, financially or otherwise. The banks who find the optimal balance of these three elements will prosper in the long term.”

BIO

VIRGIN MONEY

Leading edge technology Innovation is key; however, the real differentiator is how innovative technology is operationalised and implemented in a stable, secure way to operate at scale. Many exciting betas or prototypes exist but to truly bed-in a stable tech environment, takes skill and time. “At Virgin Money our size and scale is a competitive advantage. We have operational maturity, whilst being relatively more agile than the larger incumbent. Our technology transformation plans are focused on exploiting this agility via the development of re-usable services and cloud technologies. Re-usable services allow us to break down

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James McGlynn

Chief Information Officer Trained as a Marine electrical and electronic engineer and spent the first five years working overseas on oil/gas exploration projects. Spent 15 years in manufacturing in production, change and IT roles, latterly heading the European Manufacturing Systems division for Motorola Semiconductors. Following that, five years as Managing Director of building technology companies from startup, including an executive role in a football club. Then joined HBOS/Lloyds Banking Group in various change and CIO roles for seven years, latterly as Group Change Director for Lloyds Banking Group. Joined Virgin Money in August 2013 as Change Director, then CIO in 2015.


Innovating to Stay Ahead

The future is exciting.

Ready?

“We support Virgin Money to innovate for customers, enable colleagues to be more productive and to make efficient use of technology... together.” Search Vodafone Business


VIRGIN MONEY

complex systems into components which we can use to create different products and services quickly. You build something once and then you reuse it multiple times,” says McGlynn. “This has given us a faster lead time to market and lowered operating costs. It also gives us an open, extensible model where we can bring in the benefits of open APIs and sharing services with our commercial partners to expand our customer propositions. “We are also focused on the journey to transform physical computer systems and assets into Glasgow Virgin Money Lounge

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Cloud services which enhances our capability to flex the scale in line with business growth while avoiding linear cost growth.”

Consumer confidence To respond to the changing needs of customers and colleagues, Virgin Money needed a secure and highly reliable data infrastructure capable of running applications and services that would improve the user experience. That’s why Virgin Money partnered with Vodafone. The telecoms giant worked closely with Virgin Money to first understand the company’s


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needs and growth strategy in order to deliver the right solutions. “Vodafone has a strong pedigree in the finance sector, and our best ever network provides a future proofed data infrastructure that can scale to meet Virgin Money’s needs,” explains Mick Wayman, Head of Major Business at Vodafone UK. “We spent lots of time understanding the Virgin Money business and aligning our capabilities to their needs. We also shared insights from our own experiences and our market knowledge to help Virgin Money in

their own decision making. “The full portfolio of services we offer allows Virgin Money to consolidate the number of strategic suppliers they engage with and builds a cohesive future technology roadmap. “Our fixed and

Customers expect to be able to manage their finances whenever and wherever is most suitable for them and technology is the key to meeting and exceeding their expectations – James McGlynn, Chief Information Officer, Virgin Money

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Video: Investments in 3 minutes

Together we can create new opportunities and value. We call this Digital Co-creation.

Digital technology touches all of our lives. At Fujitsu, we bring together customers and partners from different industries and combine them with digital technology and expertise to create new value and opportunities. Find out what Digital Co-creation could mean for your business at www.fujitsu.com/digital-cocreation.


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mobile services are underpinning business critical change programmes across the UK. Vodafone teams have worked closely with their Virgin Money counterparts to make sure services are delivered ahead of schedule. When challenges were encountered by either side throughout the roll outs, we worked quickly and collaboratively to find solutions that would ensure business outcomes were not placed at risk.” By working with Vodafone to design a network solution that’s tailor-made for its needs, Virgin Money now has the secure, reliable data infrastructure it requires to provide customers with the best possible digital experience, both today and well into the future.

Changing attitudes The use of ‘big data’ analytics, open API’s and Cloud Services is set to grow across the financial sector. “The number of third party services that contribute to the end-to-end value chain between a bank and its customers can grow exponentially. This is a risk,

but successful businesses will be the ones who understand how to take advantage of this ‘ecosystem’ without losing the ownership of their customer,” adds McGlynn. Building mutually beneficial partnerships to create a resilient ecosystem has been essential for Virgin Money, and has furthered the business in standing apart from the competition. “Many businesses treat IT services as commodities, which can be consumed in-line with contracted service level agreements. We have a different take on that and believe that everyone who provides services to our customers with us and for us, needs to understand our principles, our values, and ultimately love our customers as much as we do,” adds McGlynn.

Strengthened Operational Performance In a world of fast-changing technology it is imperative for the business to work closely with partners that have the scale, innovation capability and commercial

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Future technologies are exciting differentiators but it’s still a matter of balance between rolling out an innovative technology solution while being able to operate that safely, reliably and at scale – James McGlynn, Chief Information Officer, Virgin Money

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Virgin Money Sheffield Lounge

strength to go the distance on the transformation journey. Partnering with Japanese tech giant Fujitsu, the company has brought a breadth of capabilities to the business. Most importantly, it has not only supported, but steered the development of its core banking platforms. McGlynn adds: “Fujitsu supplies the engine that drives our core banking services. The platform is reliable – quite simply, it is always on - and its performance is of the highest quality. Six Sigma performance measures are just expected when dealing with millions of customer transactions. “We have enjoyed a 30-year long relationship with Fujitsu, so we know that works but we have been impressed by the way that Fujitsu has embraced our EBO values and worked to further strengthen the partnership. Fujitsu treat us as a valued customer and work hard to understand what we are about, to build relationships and to bring us new ideas. “Fujitsu don’t rest on their laurels. They’re evolving their current service so that it can be more cloudbased and open. We put a lot of emphasis with them to make sure services are fast, secure and resilient. And that’s what they do, and they’re good at it. “Relationships, and a sharing of values runs deep between the two companies. Virgin Money and Fujitsu are working towards shared apprenticeship schemes that help school leavers enter the workplace,” he continues.

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“Fujitsu is using the Virgin Money Giving platform to support its in-house charitable work. And, in 2017, Fujitsu’s runners raised over £10,000 for the mental health charity, Heads Together, by running the Virgin Money London Marathon. A Fujitsu team will participate in the race again in 2018. “These add-ons may not look business critical, but they are really important to us. It’s what differentiates Fujitsu from other suppliers – the team gets what we are really all about.”

Advanced technological world Demand for staff to adopt a multiskilled approach within the CIO function has led the business to invest in its workforce and offer a number of graduate schemes for those currently in education. McGlynn notes: “We’re getting a different type of candidate who has a new perspective on

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technology which complements our existing teams perfectly. “To support our future plans we’ve got a very active STEM initiative with schools and colleges to get that groundswell of new talent and diversity into the technology market. “Future technologies are exciting differentiators but it’s still a matter of balance between rolling out an innovative technology solution while being able to operate that safely, reliably and at scale. Beyond that, the key is to not to forget the customer journey and experience. As such, the development of our technology strategy is about creating extensive end-to-end solutions, where we can continue to deliver the flexibility our consumers need. Making sure that we are business-led, safe and focused on what customers truly need, is the key,” concludes McGlynn.


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A true root-and-branch procurement transformation


Written by LAURA MULLAN Produced by RICHARD DURRANT

WHILST OTHER TELECOM COMPANIES HAVE STRUGGLED, TURKCELL HAS BLAZED ITS OWN PATH IN THE SECTOR THANKS TO ITS AWARD-WINNING PROCUREMENT PRACTICES


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NTIL RECENTLY, PROCUREMENT was seen as a necessary, but rarely celebrated, aspect of daily business. But times have changed. Nowadays, procurement sits squarely at the heart of almost every five-year plan and business strategy in a way the sector could never have imagined. Embarking on an ambitious root326

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and-branch transformation of its procurement function, Turkcell has seen considerable success in recent years, reporting record revenues of $4.9bn in its last fiscal year. Ali Türk, the firm’s Executive Vice President of Supply Chain Management, says that by championing resourceful buying practices and close-knit supplier relationships, procurement is elevating the company to new heights. “If you want to stay strong and


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“IF YOU WANT TO STAY STRONG AND COMPETITIVE IN THE MARKET, YOU HAVE TO ESTABLISH A POWERFUL PROCUREMENT FUNCTION”

competitive in the market, you have to establish a powerful procurement function,” he explains. “While the role of procurement used to have a supportive and reactive function, it now has a strategic and central role in the organisation. “We have a responsibility to contribute to the company’s strong

– Ali Türk, Executive Vice President of Supply Chain Management

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“CONSOLIDATING GROUP SPENDING AND BRINGING THE DIFFERENT PROCUREMENT UNITS UNDER ONE UMBRELLA WAS ONE OF THE TOUGHEST CHALLENGES WE FACED” – Ali Türk, Executive Vice President of Supply Chain Management

financial structure, leadership in corporate business, and superior customer experience.”

A DIGITAL OPERATOR Procurement isn’t the only thing that’s changing at Turkcell. A few years ago, the Turkish firm was better known for its mobile infrastructure, but today it has earned its stripes as a fully-fledged digital operator. Growing its value-added services – its digital communication platform ‘BiP’, music platform ‘fizy’, TV platform ‘TV+’, digital publishing platform

‘Dergilik’, search engine ‘Yaani’, cloud platform ‘lifebox’ as well as its legacy communication services – Türk says that the company no longer sees itself as a mobile operator, but as “the only digital operator in the world today.” “Turkcell has transformed its role from being an infrastructure focused service provider into an experience focused digital operator,” he adds. “Our digital services are giving us the opportunity to share every moment with our customers, 1,440 minutes in a day. It gives us a competitive edge over our rivals in the market right now. w w w. g i g a b i t m a g a z i n e . c o m

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“We closed our last fiscal year with a 23.4% increase in local currency revenues, thanks to our 4.5G investments and successful digitalisation model,” he adds. With a footprint across Turkey, Ukraine, Belarus, Northern Cyprus, Germany, Azerbaijan, Kazakhstan, and Moldova, Turkcell has evolved to become an international technologydriven and customer-centric company.

POWERFUL PROCUREMENT Procurement has played a pivotal role in this shift and, as a result, the chief of procurement has gained a welldeserved place at the company’s executive board level.

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In his role, Türk is responsible for the procurement of approximately $1.1bn in annual capital expenditure (2017). With 300 people in the supply chain management team, Türk says that procurement is contributing to the company’s finances and enhancing its sales activities. “Buying decisions have a direct effect on company’s’ earnings before interest, taxes, depreciation, and amortisation (EBITDA),” explains Türk. “This is one of the most important reasons why we are in close cooperation with our finance people. “It’s helping us streamline processes, better serve our internal customers’ needs and identify better sources of


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supply,” he continues. “In essence, supply chain management plays a critical role in reducing the bottom line spending and increasing the top line revenue growth.” The Chartered Institute of Procurement & Supply, better known as CIPS, represents one of the highest procurement standards in the world today. By overhauling its procurement function, Turkcell emerged as one of the first companies in the country to achieve this certification. Along this journey, Turkcell has seen an ‘external transformation’ whereby it has grown its relationships with its suppliers; an ‘in-company transformation’ which it changed how it

Investing in its people This procurement journey wouldn’t be possible without the talent and expertise of Turkcell’s employees. Therefore, the Turkish company has developed a unique Young Talent Program, Digital Masters Program and Marketing Masters Program to help nurture the company’s skills. “We have taken serious steps towards recruiting the best talent on the market, enhancing the capabilities and competencies of our employees,” says Türk. “Our people are one of the key drivers behind our groundbreaking results.”

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communicated with internal stakeholders and management; as well as a ‘structural transformation’ where its internal procurement function underwent organisational changes.

Ali Turk addresses a group of Turkcell’s leading vendors

EXTERNAL TRANSFORMATION Sustaining strong supplier relationships is a critical aspect of supply chain management and, when working with almost 1,800 suppliers, it’s something Turkcell doesn’t take lightly. As a result of a workshop with its top 20 strategic vendors, Turkcell has started to work towards increasing the transparency of its supply chain, using digital tools like online supplier portals and e-auctions. Vendors can apply for active tenders through Turkcell’s online supplier portal, with 95% of tenders being published publicly. Additionally, with 90% of Turkcell’s sourcing carried out through e-tendering, suppliers can also bid online through Turkcell’s e-auctions. “Online tendering tools are very efficient and transparent,” notes Türk, “so this means suppliers can no longer claim that they have the lowest offer or that their offers are not being assessed. 332

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“The procurement team has also benefited from our supplier’s positive change in perception, the reduction in negotiations, and the data we can collect from submitted offers,” he adds. “We are trying to stop evaluating our suppliers from a price-driven approach and trying to build long-term valueadding partnerships.” On top of this, the Turkish company has promoted an open-door policy with suppliers. This means that if a supplier


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wants to get in touch with Türk’s team they can have a face-to-face meeting in less than two weeks. “Although it can be tough and timeconsuming, these practices have increased the level of confidence our suppliers have in us and it has supported the transparency of the organisation,” he says.

IN-COMPANY TRANSFORMATION Yet, Turkcell has not only transformed

how it works with its suppliers – it also works more closely with internal stakeholders and management to reimagine its procurement function from the inside-out. With a seat at the top level of the organisation, the procurement team has weekly meetings with internal management every week, which has helped to increase its visibility. “With the new C-level presence, the power of distance between top management and the procurement team has vanished,” Türk bserves. “The new structure has increased the confidence of the procurement team and support from top management has helped to enhance the teams’ awareness and capabilities.” Cooperating closely with Turkcell’s finance division, procurement is also helping to manage the company’s strong financials by providing cash flow reports, opex optimisation programmes and capex per revenue analysis, for instance, to see visible financial results. Increasing the visibility of the procurement function, Turkcell has also formed a strategic buying committee which Türk says has been a roaring success. “The strategic buying committee w w w. g i g a b i t m a g a z i n e . c o m

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was also a great opportunity to impress top management and show how procurement can bring additional value to the business,” he notes.

STRUCTURAL TRANSFORMATION Perhaps one of the biggest transformations, however, is how Turkcell’s internal procurement function has evolved. With over 30 companies under the Turkcell umbrella, the digital operator consolidated its group spending into one centralised procurement team. “Consolidating group spending and bringing the different procurement units under one umbrella was one of the toughest challenges we faced,” notes Türk candidly. “However, the company has not only profited from the increased budget, our smaller group companies were also benefited by the unified processes and contracts which helped to deliver savings.” In the midst of Industry 4.0, digitisation has also had a ripple effect on the company’s procurement function. The Turkish-based company has created a digital cockpit which monitors the company’s supply chain management, sales, network operations, marketing and HR in real time. With the help of this digital cockpit, Turkcell has made dashboards which combine different reporting tools, on the same platform, using different data sources. By developing and customising its current infrastructure, this digital cockpit makes access to information possible in real time monitoring. On top of this, procurement has also developed a supplier integration project with one of its vendors for real-time order monitoring. “Today if your strategies, resource planning, and business 334

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BiP users are able to make voice and video calls as well as messaging services

models are not in line with digitisation, it is impossible to be successful,” Türk says. “Therefore, we have digitised our processes, services and more to make real monitoring possible throughout the organisation.” All of these initiatives and policies have accumulated to form an immense transformation, one which demonstrates the firm’s innovative thinking, strong business practices, and collaborative approach.

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a mammoth task but it hasn’t gone unnoticed by the international supply chain community, apparent as Turkcell scooped up accolades at both the Supply Chain Excellence Awards and the inaugural Procurecon Europe in association with CIPS SM Awards. Procurement is a discipline that is defined by the need to meet aggressive cost targets, and thanks to its awardwinning procurement strategies Turkcell is meeting this challenge head-on. Working with around 1,800 suppliers, the company deftly tackles supplier relationship management with its suppliers’ performance management tool and its supplier management system. These tools allow Turkcell to track its procurement processes from endto-end and also allow it to measure suppliers’ performances using key performance indicators. In turn, this is helping to promote supplierenabled innovation and cost-effective procurement. On top of this, the company also manages its strategic business partners using a Key Account Management (KAM) model. Using this model, the firm promotes a dedicated, standardized,


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•T  urkcell reported an 23.4% increase in revenues to TL 17.6bn (c.$4.9bn) in its last fiscal year. •9  0% of Turkcell’s sourcing is done through e-tendering. •9  5% of Turkcell’s tenders are published publicly on its online supplier portal. •T  here are 30 companies under the Turkcell umbrella.

disciplined and heightened focus that ensures tasks are fully completed to a high-standard in an efficient way. Türk also credits the firm’s innovative bundling negotiation technique for some of its success. “We have changed the rules of bundle negotiations and transformed it into a more planned, structured, systematic and collaborative structure,” he adds. Understanding the collaboration is key to success, Turkcell has also organised a Supplier Summit whereby the company can explain its strategies

and expectations, make new business connections, strengthen existing relationships, and discuss new market trends. In a similar vein, Turkcell’s procurement team is collaborating closely with its finance division. By working together, the pair approach the firm’s budget in a very disciplined manner, meeting challenging capex and revenue targets. With enviable financial health and some of the industry’s leading procurement practices, it seems Turkcell is set w w w. g i g a b i t m a g a z i n e . c o m

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to continue on its upward trajectory. But what are the next steps for the digital operator? As a Turkish company, one of the company’s main focuses is supporting local production and local firms that will contribute to the country. What’s more, the digital company has also revealed that it is participating in a joint venture to create the country’s first national car and it is also helping to develop smart cities using its 4.5G technology. Forecasting a surge in demand for data, Türk also says that the company will continue to tap into the growing demand for data, leveraging its search

engine ‘Yaani’ and developing new tier III data centres. “We expect that demand for data will keep rising as we see more and more 5G technologies,” he says. “Everybody needs to understand that a country which does not own its data is a country that is going to disappear in the future.” In order to keep Turkish data in Turkey, the company notably has several data centres in the country. “All of these data centers have been built to Tier III certification in order to provide security and management services for our customers at the highest international level,” Türk adds. Keen to show leadership in

“WE ARE TRYING TO STOP EVALUATING OUR SUPPLIERS FROM A PRICE-DRIVEN APPROACH AND TRYING TO BUILD LONGTERM VALUE-ADDING PARTNERSHIPS” – Ali Türk, Executive Vice President of Supply Chain Management

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corporate business, Turkcell is also looking for new opportunities as a health technology provider. For example, the company has embarked on a series of city hospital projects in partnership with one of the main health investor companies in Turkey to help usher in a new era of digital hospitals. “We have digitised city hospitals from end to end by installing and managing the latest technological infrastructure and IT management systems,â€? TĂźrk explains. On top of this, the firm is also exploring opportunities as an educational technology provider.

All in all, it seems Turkcell has truly evolved from the company it was when it was first founded in 1994. It has undergone an extraordinary shift, putting procurement at the heart of its strategy. As such, whilst other telecom companies have struggled, Turkcell has blazed its own path in the sector.

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Powering ‘SMART’ DIGITISATION in the banking sector

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Embarking on a root-and-branch transformation to use technology more smartly, United Arab Bank is focused on what matters – its customers

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igital transformation and digitisation are just some of the buzzwords which have saturated the banking space in recent years. For United Arab Bank (UAB), the company’s digital strategy isn’t about following trends or excessive expenditure on new technology, it’s about taking pragmatic, informed steps to ensure that the focus is on what matters the most – the customer. With this focus in mind, UAB is using up-to-date technology to realise true potential of digital transformation so that the customer receives the world-class service they expect. UAB’s Chief Operating Officer Izzidin Abusalameh says, “I do believe that behind each service or transaction we do for our customers, there is either a human story or a commercial interest and, in both cases, we cannot miss out on these.

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Therefore, customer service is, and will remain, one of our top priorities.” “Digital transformation is a prime focus for any bank or financial institution, but UAB is keen to achieve this objective through ‘smart digitisation’ by adopting latest technologies and utilising the power of data.” For Abusalameh, UAB’s digital transformation strategy is straightforward – apply the latest technologies in simple, smart and proactive ways while keeping the bank’s customer in mind. “By applying technology in an appropriate way, we aspire to be proactive,” he explains. “This allows us to reach out to our customers who may need help before they even raise their hand to ask for assistance. This proactive approach is the cornerstone of our philosophy on which our digital transformation is based.”


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“I do believe that behind each service or transaction we do for our customers, there is either a human story or a commercial aspect and, in both cases, we cannot miss out on these” IZZIDIN ABUSALAMEH Chief Operating Officer

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UAB has a strong reputation in the UAE’s banking industry since it was established in Sharjah about 43 years back. While in 2017, the bank made an annual net profit of AED 17 million, it has clocked an impressive AED 36 million profit in Q1 2018 demonstrating the strength of its ‘core’ business. Smart digitisation To deliver ‘smart digitisation’, Abusalameh says that the bank is working on a plan to consolidate the number of systems it has. In doing so, it is also creating a robust IT structure, using powerful state-of-the-art tools from the tech industry to ensure operational efficiency, productivity

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The United Arab Bank’s profit in Q1 (AED)


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and sustainable growth. “It entails careful selection of technologies and only working with the industry leaders in that specific market,” Abusalameh says. “We use industry leading market research rankings and look into certain areas of technology to see who the market leaders are. We deep dive into their functional capabilities and evaluate their technical components according to the bank’s current and future

requirements in order to arrive at an optimal technology stack in sync with the bank’s overall IT architecture. “Working alongside tier one technology providers to implement their “specialised” version with minimum customisations in line with industry best practices has become a guiding principle,” he elaborated. By undertaking a deep level of planning and understanding, the UAEbased firm is getting the maximum potential from its technologies.

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Unlocking the potential of technologies Abusalameh says that this pragmatic approach is helping the bank connect its different technological tools so that it can create one streamlined digital strategy. “UAB is also investing in new Enterprise Resource Planning (ERP), Human Capital Management (HCM) and Customer Relationship Management (CRM) systems from SAP to eliminate non-value added tasks so that staff can focus on their core activities while enhancing productivity. “When you acquire a new global HR system you will also acquire new best practices which,

1975

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The year that the United Arab Bank’s was founded

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of course, increases efficiency,” he says. “This is also applicable to our other systems such as ERP.” The power of data Today, data is often described as the ‘new oil’ – valuable to have, even more so if it’s refined and used efficiently. UAB recognises the importance of data and is fully committed to utilise data & analytics to drive business growth. “Today, data science is what everyone’s talking about by far,” Abusalameh adds. “Data hasn’t become valuable overnight, it’s always been important but what has significantly changed is the computing power, data storage capability & the means of organising it. “That’s why I always encourage the bank’s head of digital and head of data to work closely together more than ever before. With changing times, our impetus is more towards using statistics and data science to help the bank leverage the power of predictive analytics in real time.” In this way, data ensures that continuous improvement is at the cornerstone of UAB’s strategy.

“We want to be recognised as a bank to stand by, a bank which puts the customer first” IZZIDIN ABUSALAMEH Chief Operating Officer

The company’s commitment towards being a data driven bank can also be evidenced by the confidence placed in it by Informatica (a leading data management platform) through an award for innovative usage of its data management platform and products last year. In-depth understanding Yet, with ever-more data, this is not only driving efficiency and operational excellence internally, it is also transforming the customer’s experience. “In every bank today, data helps companies gain a 360-degree view of their customers but if you gain even more data, you will be able to predict their behaviour, improve your service,

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and provide a 3D view of your customers whereby you understand them a bit deeper,” Abusalameh explains. “This can make much a difference if you can then reach out to a customer. The company’s digital transformation has been a huge task but it hasn’t gone unnoticed by the international tech community, apparent as the bank collected the Genesys Award for Best Use of Technology in the Banking sector last year.

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A mindset shift Referring to the biggest challenge for the bank, Abusalameh said that the mindset shift that took place to bring digital transformation was a daunting task, but it was successfully implemented by the management. “For any transformation journey, changing the mindset of the company is usually one of the top challenges,” he says. “It basically requires openmindedness and commitment


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from everyone in the team starting from the top management.” In addition, Abusalameh considers rigid technology software another challenge to implement smart digitisation process. “Many of the world’s major technology suppliers need to do more to make their products more flexible and easy to implement & upgrade,” he notes. “The more flexible your platform is, the quicker you can

adapt it and take it to market.” United Arab Bank will always remain known for – its continuous commitment to its customers. “We’re aspiring to give the best customer service in the UAE,” Abusalameh concludes. “We want to be recognised as a bank to stand by, a bank which puts the customer first.”

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Bringing the five-star treatment to hotel IT

Written by Laura Mullan Produced by Craig Daniels


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AT L A N T I S , T H E PA L M

Set on the iconic Palm Jumeirah island, Atlantis, The Palm has come to characterise the ultimate Dubai experience. With whimsical and luxurious amenities and pragmatic digital tools, the five-star hotel guarantees that you’ll be awe-struck from the moment you check in


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ringing the ethereal legend of Atlantis to life, Atlantis, The Palm is easily one of the most recognisable hotels in the Dubai skyline, if not in the world. A record-breaking 15.8mn people visited the dynamic city of Dubai last year, but the hotel’s VP of IT Anthony Lynsdale believes that the five-star property is quickly becoming a destination in itself. “A lot of people want to come here because they’re looking for a once-in-a-lifetime-style experience. They want to take away a memory,” Lynsdale muses. “Many of our guests choose to book Atlantis because it’s a destination in itself; it’s a landmark property for Dubai. “There’s lots of competition and there are lots of great hotels in the city,” he continues. “So how do we differentiate ourselves? Our motto is to blow away the customer with amazing experiences – that’s what we live by and that’s what makes us unique.” Located on the Palm Jumeirah,

one of the world’s most iconic holiday destinations, and nestled within 42 acres of lush greenery, the hotel overlooks the sparkling coastline of the Arabian Gulf and offers 1,539 rooms, 23 restaurants, cafes and lounges, a luxurious spa, immersive aquarium, and an awardwinning waterpark for its guests. But with such a mammoth operation, how does Atlantis, The Palm ensure guests receive its acclaimed five-star standard treatment time and time again? For Lynsdale, the answer is simple. Not only does the hotel consistently go the extra mile for its guests, it is also tapping into cutting-edge technologies to ensure that the resort is well-equipped for the digital age. Practical, pragmatic IT Digital transformation and disruption are just some of the many buzzwords that have saturated the tech sphere in recent years. For Lynsdale, the hotel’s digital strategy is not about following trends, it’s about taking pragmatic, practical steps to support the business

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with the very best infrastructure, to help achieve its goals. “Our digital strategy really revolves around partnering with the business and stakeholders, identifying what their pain points are, and prioritising where we can gain efficiencies,” Lynsdale explains. “We really want to make sure that we’re fully utilising the systems that we have today. In IT, there’s often a tendency to shop around and buy systems, instead of fully optimising the systems already in place. Are

we getting the very best from the current vendor, from the system? There’s definitely an aspect of making sure that the systems we have today are reaching their full potential and driving efficiencies. “It’s also about making sure that our systems are future-proof and scalable to support our other property currently under construction, The Royal Atlantis Resort and Residencies,” he adds. Connecting IT and marketing In our ever-connected world, where


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devices are endlessly at our fingertips, technology and marketing have become increasingly entwined. The importance of this connection is something which Atlantis, The Palm doesn’t underestimate, and Lynsdale has therefore made significant efforts to elevate the business’ marketing division to bring it to new heights. “Understanding the nature of the hotel business is key – with such a large resort, if you don’t get the marketing right, whether it’s digital or physical, you will miss opportunities to engage with guests,” Lynsdale comments.

“Nowadays, everything is at our fingertips. We’re using mobile apps. We’re using websites. We have access to a lot of information. “We have certain traditional IT systems that need to be maintained, but I think where the real business transformation will come is our strong focus on digital marketing,” he continues. “That’s something I’m conscious of and the key reason I’ve built a strong relationship with our marketing and sales divisions,” concludes Lynsdale. Information at your fingertips None of Atlantis, The Palm’s

The year that Atlantis, The Palm was founded

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information points demonstrates this better than its interactive digital signs, which are strategically placed throughout the resort. Brimming with world-class facilities, it could be easy for guests to miss out on some of the resort’s renowned amenities, but thanks to this marketing tool, navigating the resort can seem as easy as walking through your own home. “Atlantis, the Palm has a huge footprint, so it was imperative for us to bring all of our information together by using a best-in-class, centralised content management system,” says Lynsdale. “It’s about making sure we have the relevant information, at the relevant location, at the right time so that our guests can avail of our facilities, whether it’s new discounts, happy hours, or water park experiences.”

“Our motto is to blow away the customer with amazing experiences – that’s what we live by and that’s what makes us unique” Anthony Lynsdale, VP, IT

Social-media savvy In a similar vein, the Dubai-based hotel has also focused on boosting its social media presence. Last month, the beach-side resort reached a million Facebook fans. To celebrate this, it created ‘Atlantis Fan Suite’ – a money-can’t-buy hotel experience whereby social media followers were given the chance to stay in one of the hotel’s brand-new rooms,

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Number of staff working for Atlantis, The Palm

3,100 decked out with unique social mediainspired innovations, at no cost. Every element of the suite is linked to Facebook, whether it’s unlocking your door with your Facebook login, to ‘poking’ your personal butler if you need assistance. “They furnished it with a little bit of technology, so for instance, it has an interactive mirror that shows your Facebook feed when you check in,” notes Lynsdale. “It’s something quirky, but again, it also shows our continuous innovation and our drive to blow away the customer

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with every interaction.” Mobile interactivity Mobile technology is quickly changing the hospitality game and this is something which Atlantis, The Palm has undoubtedly tapped into. Recently, the luxury hotel resort partnered with Wi-Q to develop an intuitive web app that allows guests to order food and drink from the comfort of their sunbeds. “We’re pushing the menu to them so that they can order items and


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get them delivered to where they’re located,” explains Lynsdale. “Guests are using more devices, more frequently. Mobility on the guests’ side is increasing and so Atlantis is now working on attracting guests using mobile technology,” he continues. “We want to begin their journey before they arrive by creating an app where they can engage and discuss opportunities and activities

that they would like to do when they get here. Mobile connectivity is definitely something that we’re keen on bringing to life.” This snowballing effect of mobile technology isn’t just transforming the customer experience, it’s also helping to transform Atlantis, The Palm’s back of house operations. By equipping housekeeping staff, bell service, and front desk staff with mobile devices, the luxury

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“IT needs to be the centre of almost everything. It’s about making sure that we’re continuously improving the guest experience”

Artwork copyright by Wi-Q Limited

Anthony Lynsdale, VP, IT

The web app designed and built by Wi-Q Limited


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hotel ensures that employees can respond to requests at the touch of a button. “With a resort of this size, we have a lot of staff that are using mobile technology, whether it’s to manage guest requests, or to help manage the hotel’s dayto-day tasks,” notes Lyndale. “We use a system called HotSOS to do this, and housekeeping uses a module of this called REX to manage the rooms. We’ve given our employees more than 200 smart devices, and now they’re operating pretty much in a paperless environment.” Managing a 1,539-bedroom hotel is no easy task, especially when it comes to checking in. Looking at simple ways to try and speed up the process, Atlantis, The Palm has also collaborated with Samsotech and Oracle Hospitality to create a passport check-in system that Lynsdale says is the “first system of its kind” in Dubai. A solid IT foundation Yet not all of Atlantis, The Palm’s innovations are future-facing.

Some integral digital initiatives have involved tirelessly tinkering away to update legacy systems and creating a hyper-converged infrastructure. “What we’re doing with our infrastructure is a stepping stone for two reasons: one is the ability it gives us to have a disaster recovery site, and secondly it is building the platform for our yet-to-launch sister hotel in Dubai, The Royal Atlantis Resort and Residences,” notes Lynsdale. “We will have a very scalable infrastructure platform going forward. Our team is always looking out for something new, and the business is demanding more from the IT function. They’re pushing us and always looking and searching for the next big thing.” Imparting a lasting travel experience, Atlantis, The Palm has earned its stripes as a five-star hotel and a must-see destination in Dubai, but for Lynsdale, it is technology which has played an integral role in ensuring that guests always receive the best-in-class service it has become renowned for. “IT needs to be the centre of almost everything,” he reflects. “It’s about making sure that we’re

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Number of rooms at the Atlantis, The Palm

The area covered by Atlantis, The Palm property

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The area covered by the Aquaventure Waterpark


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continuously improving the guest experience. “Technology has played a key role in the way we manage the business, whether it’s the data that we review, analyse and make decisions on, or how guests consume our services. For us, technology is paramount.” Atlantis, The Palm has seen a root-and-branch transformation of its digital function and although technology has played a pivotal role, Lynsdale says that this is all thanks to his team’s hard work and perseverance. “Without a dedicated team of technology professionals all of this wouldn’t be possible,” he says, candidly. By all accounts, it seems that at Atlantis, The Palm, the company’s staff are its greatest assets. It’s an exciting time for the Atlantis brand – the hotelier is opening a succession of new hotels including Atlantis Sanya in the South China Sea and is exploring expansion opportunities in tourist hotspots such as Hawaii. Amidst this, Atlantis, The Palm hasn’t forgotten the fundamentals of a successful hotel digitisation strategy, and it is this pragmatic thinking which is helping the hotel provide a guest experience like no other.

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Gigabit Magazine - May 2018  
Gigabit Magazine - May 2018