SAP Mounts Formalized CRM Drive

SAP has formalized its approach to Customer Relationship Management (CRM) by consolidating upon recent acquisitions and integrating these functions into its existing stack of database and data analytics technologies.

In specific terms, SAP has now brought together acquisitions including Hybris (acquired in 2013 – CRM and commerce software), Gigya (acquired in 2017 – customer identity management technology used to manage customer profiles, preferences, opt-ins and consent settings) and CallidusCloud (acquired in 2018 – technology that links salespeople with information related to pricing, incentives & commission all linked to a firm’s Enterprise Resource Planning (ERP) systems) — the combined sum of these parts will now be known as SAP C/4HANA.

With SAP’s existing business suite being labelled SAP S/4HANA, the firm has obviously adopted the same naming convention replacing the S-for suite with C-for CRM. The company’s drive to build a more established CRM offering will see it go head to head against not just Salesforce, but a selection of established players in this space including Oracle, Dynamics 365, Verint, Pegasystems and others.

Customer Experience division (the new SAP grouping that includes Hybris, Gigya, Callidus and other elements) president at SAP is Alex Atzberger. Suggesting that there have been four eras of CRM through the ages, Atzberger details them as:

1. Basic customer sales-based lead optimization systems.
2. So-called ‘point’ solutions designed to address one specific CRM issue.
3. Cloud-based systems.
4. More intelligent holistic connected CRM systems that connect the customer experience to the actual supply chain that an enterprise operates on a day-to-day basis.

Lamenting what SAP CEO Bill McDermott has called the “sales-only focus of legacy CRM solutions”, SAP thinks it can offer a new notion of CRM that exists in the 4.0 age. This is CRM that is more intrinsically engineered into (and integrated with) a customer’s wider software stack of applications and database management systems – and indeed the enterprise demand and supply chain.

“SAP was the last to accept the status quo of CRM and is now the first to change it,” said McDermott. “The legacy CRM systems are all about sales; SAP C/4HANA is all about the consumer. We recognize that every part of a business needs to be focused on a single view of the consumer. When you connect all SAP applications together in an intelligent cloud suite, the demand chain directly fuels the behaviors of the supply chain.”

In line with its new CRM offering SAP has also announced the SAP HANA Data Management Suite. This is software designed to combat what has been called ‘data sprawl’ resulting from firms who operate with highly distributed data that exists in lots of different locations, on different devices, on different platforms, in different states (structured, semi-structured and unstructured) and in different business workflows and business processes.

The SAP C/4HANA suite will offer full integration with SAP’s business applications portfolio, led by the SAP S/4HANA ERP suite.

Crowd-service: more help, from ‘any’ employee

There’s one other add on here for customer service. SAP has also acquired Switzerland-based Coresystems AG to improve field-service customer experience, especially in the manufacturing, energy, high-tech and telecommunications industries. This software service provides scheduling for customer-service requests and uses artificial intelligence-powered crowd-service technology. SAP insists that this broadens the ‘service technician pool’ (those people able to fix any particular problem that occurs in a company during its working day) to include company employees, freelancers and industry partners. The ‘crowd service’ concept means that enterprises can assign the best-qualified technician (or person able to help) to each service call by taking into account expertise, location and availability.

“All systems rely on data, yet the challenge facing companies today is distributed data — data that is not just in transactional systems but scattered across products, machines and people. It is about data that must be ingested, prepared and made enterprise relevant. SAP HANA Data Management Suite enables enterprises to turn massive amounts of data — both structured and unstructured — into valuable, usable knowledge, no matter where it resides,” notes SAP, in a product launch statement.

The SAP C/4HANA portfolio includes SAP Marketing Cloud, SAP Commerce Cloud, SAP Service Cloud, SAP Customer Data Cloud (including the acquired Gigya solutions) and SAP Sales Cloud (including the acquired CallidusCloud solutions). Additionally, SAP Sales Cloud unites the SAP Hybris Revenue Cloud solution and SAP Hybris Cloud for Customer (comprised of SAP Hybris Sales Cloud and SAP Hybris Service Cloud solutions).

The SAP Hybris name (along with other acquired firms noted in this story) will now be retired to consolidate under the SAP Customer Experience business unit.

The real challenge here is…

Whether the next generation of CRM actually results from one vendor firing pot-shots or thinly-veiled swipes at one another or not, the big question here will come down to implementation, integration and interconnectedness of the systems being built.

As already suggested here, success in the 360-degree connected CRM world is a question of real end-to-end real-time synchronization between the demand chain and supply chain. That means using ERP and CRM — and a list of other favorite tech industry acronyms including Field Service Management (FSM), Human Capital Management (HCM), IT Service Management (ITSM) and more – and being able to access the data that resides in the clouds serving those functions.

Unless we the humans can get access to the right data, in the right cloud services, serving the right business processes, in the right configuration patterns… then we won’t be able to physically get our developers to code the right functional ‘scripts’ into the codebases that run the so-called ‘smart’ (CRM or otherwise) applications of the future.

There’s a gap in between pure theory and applied empirical success here and SAP will obviously now be working hard to make sure it has customer reference points to convince us that its vision holds water. Claims that CRM is dead and that we can now shout long live 360-degree ERP CRM require deeper analysis and the journey is just starting. This revolution will be televised.

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Dimension Data acquires leading SAP digital commerce consultancy

Dimension Data has acquired a majority stake in e2y, a digital commerce consultancy firm based in the UK.

The move is designed to strengthen the technology provider’s digital business solutions portfolio across the world, through the addition of digital commerce capabilities.

Headquartered in London, e2y specialises in customer experience, project delivery and commerce, leveraging marketplace partnerships with SAP Hybris and Mirakl.

“With the future of commerce being firmly focused on the experience of trading online, and our digital business solutions portfolio centred on driving innovation for our clients, our investment in e2y will bring our clients closer to their customers on these advanced commercial platforms,” said Scott Gibson, group executive of digital business solutions at Dimension Data.

“It will also help us continue to guide our clients along their business transformation journeys.

“The strength of e2y in the UK and Europe, combined with Dimension Data’s presence in the Middle East and Africa, the Americas and Asia Pacific, will open up new markets for our clients to leverage a truly compelling digital commerce solution.”

According to Gibson, the provider will aim to leverage key capabilities across the advising, implementing and supporting of customers on a range of digital commerce platform solutions.

“This adds a complementary set of skills to Dimension Data’s core value proposition around systems integration, managed services and specifically in this area providing services that add to digital infrastructure consulting and services proposition,” Gibson added.

From a digital commerce standpoint, e2y provides consulting around SAP architecture and delivery, in addition to payment strategy and project management.

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SAP Applies Conversational Interface to Analytics

A conversational interface driven by AI will be the future of how you’ll access and understand SAP’s analytics cloud.

The way end users interact with analytics applications is about to change to the point where many of them will no longer necessarily need to rely on someone from IT to generate a report on their behalf.

At their recent 2018 Sapphire Now + ASUG Annual Conference, SAP announced Search to Insight, which makes use of conversational artificial intelligence (AI) and natural language processing engine to provide insights into data residing on the SAP Analytics Cloud.

Providing that capability will change the way end users and IT organizations interact with one another daily. There will still be a need to run complex reports. But most of the report requests that previously required someone in IT to build a report will soon be handled by a simple voice request.

That shift will require many analytic professionals to be retrained, says Mike Flanagan, senior vice president of analytics strategy for SAP.

“Like most things involving AI, there will be some jobs that go away and others that are created,” says Flanagan.

Those new jobs will be focused more on building more sophisticated analytics applications leveraging AI models. It takes a significant amount of time and effort to create those AI models and IT organizations will need to be able to aggregate enough data to make those algorithms effective. SAP is betting that one of the places organizations will opt to store that data is the SAP Analytics Cloud.

The conversational interface SAP has developed leverages machine algorithms that SAP has developed under its SAP Leonardo initiative and chatbot technology that SAP gained when it acquired Recast.AI earlier this year, says Flanagan.

Longer term, end users should also expect to see SAP employ machine learning algorithms to automatically alert end users about relevant trends that have become apparent by applying analytics to the latest data. To facilitate that process SAP has moved to embed the analytics libraries it developed for SAP Analytics Cloud directly into the SAP S/4HANA Cloud, the version of the company’s enterprise resource planning (ERP) applications that it delivers as a cloud service. Pre-built content and business logic for more than 20 SAP applications, including SAP SuccessFactors, SAP Ariba, and SAP S/4HANA is also being made available and SAP has committed to embedding all the capabilities of SAP Analytics Cloud across its entire portfolio.

Each individual organization will need to determine based on performance requirements when to run analytics application code locally versus relying on REST application programming interfaces (APIs) to access a remote service such as SAP Analytics Cloud. But regardless of the approach, SAP is leveraging its investments in the SAP HANA in-memory database to deliver analytics in near real-time.

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SAP outlines approach to data management

Adding to the challenge is the need to manage, analyse, govern and secure data being created and streamed from internet of things (IoT) devices operating at the edge of network in real-time.

Such challenges are what SAP hopes to address with its Hana Data Management Suite that was unveiled recently at its Sapphire conference in Orlando earlier in June 2018.

“Our customers use an average of six to eight clouds, including SuccessFactors and non-SAP clouds like Salesforce.com,” said Ken Tsai, SAP’s global vice-president and head of cloud platform and data management.

“Although some cloud suppliers say you can store all your data in Amazon Web Services, that’s not possible unless you put your cloud applications in there.”

With no way to consolidate all of an enterprise’s data onto a single platform for analysis, Tsai said there was a need to solve the data management problem from a different perspective.

Rather than share data across different applications, he said a more efficient – and secure – way was to make metadata available to all applications from a central location. “Data security, privacy and governance should also be shared across systems whether you are using SAP or third-party applications,” Tsai said.

“You can have your own data but its visibility should be shared, and that includes data queries and data models so you can potentially move workloads from one system to another or from on-premise to the cloud and back,” he added.

The SAP Hana Data Management Suite is based on the latest versions of the SAP Hana business data platform, SAP Data Hub, SAP Cloud Platform Big Data Services and the SAP Enterprise Architecture Designer Web application.

By bringing together various data management capabilities – including master data management, data lakes and integrating real-time data pipelines from myriad sources – Tsai said the SAP Data Management Suite will address data management challenges from an integrated perspective, along with a consistent user experience.

He added that the new suite, available on-premise and as a cloud service or hybrid offering, will also let enterprises anonymise data by adding noise to data queries.

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Calling all SAP customers: here’s what you need to know about the new pricing model for Indirect Access

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10-Minute Summary – Solve for Happy Book Summary – Mo Gawdat

Solve for Happy Book Summary – Mo Gawdat, former Chief Business Officer at Google X, was at the top of his career. Financially well off, with a job many would kill for and a loving family. And yet, despite all this, he wasn’t happy. Why?

Like many others before him, Gawdat grappled with this question for years and, when suddenly losing his 21-year-old son during a routine procedure at a hospital in 2014, it deepened into a quest to discover what truly constitutes human happiness and how to stave off disappointment in life. By applying his analytical mind to the problem, and examining key ideas from many of the world’s religions, Gawdat finally arrived at his own happiness formula.

This article layout Gawdat’s ideas on happiness; the illusions standing in the way of it, the many blind spots of your mind that cloud your vision from what life is reallylike, and the ultimate truths that will bring real joy and happiness into your life.

We’ve all heard that money can’t buy you happiness, though many people are still driven to pursue financial success as their primary goal. It’s no wonder, then, that they find themselves unhappy even when they appear to have everything. But what can be done about it? This is the question Gawdat grappled with himself, so he decided to apply his engineer’s mind to figuring out a formula for achieving happiness.

Let’s start by trying to understand what happiness is. Look at the semi-permanent joy of small children and toddlers and you could see that it is, in fact, our default state. Sure, it’s not all roses, but as long as they aren’t hungry or in pain, kids are generally happy. You could say that happiness is merely a lack of unhappiness.

But where does unhappiness come from? According to the author, it comes about when life doesn’t behave the way you expect it to. Here’s the formula that he came up with:

“Your happiness is equal to or greater than your perception of events minus your expectations of life”

This means that when you regard life’s events as the same or better than your expectations, then you’ll be happy because the twists and turns of life don’t frustrate you. But if your expectations are greater than the reality, they’ll subtract from your capacity for happiness.

Naturally, it’s not as clear-cut as this. You’re much more complicated than just happy or sad! Depending on the thoughts you allow to determine your expectations, your state of mind can range from total confusion to negativity and suffering, to positivity and happiness, all the way to absolute joy. The goal is to make that journey from the bottom to the top.

To prevent yourself from becoming confused and unhappy due to the gap between your expectations and reality, you’ll first need to discard the six grand illusions that leave you misinformed.

In the 1999 sci-fi film The Matrix, the main character, Neo, suddenly breaks through the illusion of the world around him and sees it as it really is – long green columns of ones and zeros – and is able to take control of himself and his environment. Like Neo, if you can see past the illusions, then you too can take control of yourself and your happiness.

Start by shattering the first illusion which is that the voice in your head – the one that questions your actions and intentions – is the real you. In the 1930s, a Russian psychologist named Lev Vygotsky noted small muscular movements in the larynx accompanying inner thought, and suggested that the internal narrator was actually just the internalization of speech – a hypothesis confirmed by neuroscientists in the 1990s, when they found that parts of the brain active while talking are also active during inner thought. So the voice in your head is actually your brain talking to you as it tries to understand the world around you and make the best possible decisions. But it isn’t you.

So when listening to your negative thoughts, remember that……

To Read Solve for Happy Book Summary sign up to Blinkist for free (Click here)

Ever read 4 books in one day?

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Cloud ERP Now Available For Building

One Channel, Africa’s fastest-growing cloud business solutions provider, has launched its Acumatica product for construction called One Build. This is an end-to-end cloud business management system for general contractors, home builders, subcontractors, specialty contractors and land developers.

Acumatica One Build is a true cloud solution that can significantly lower the cost of doing business. It combines features like project and cost management with contracts, commitments, subcontracts, compliance, retainage and other industry capabilities.

One Channel CEO Bernard Ford says Acumatica One Build offers full business process management (BPM) via its AcuFlow module which includes the ability to do sub-contractor payment certificate approvals and payment.

AcuFlow allows organisations to automate their complex workflows across different corporate entities and existing installed applications, in order to extend the reach and value of Acumatica ERP.

He says while Acumatica does have workflow functionalities, AcuFlow is designed specifically to handle complex business process flows. “For example, the system can execute complex procurement requests across two separate companies in two different currencies.”

“It offers auto-procurement via AcuFlow directly from bill of quantities and can integrate other estimating systems. More importantly, it provides mobile device integration for all processes, supporting workers and management on-site,” he explains.

Acumatica One Build was designed to address the needs and demands of modern construction companies. It utilises the Acumatica Cloud xRP platform and core application suites to also offer project accounting, compliance management, retainage, change orders, job costing, and document management.

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How to use social media to make your CRM more intelligent

Effective customer relations management is the very foundation on which the success of a business rests. Customers are the most critical factor in for functioning of a business. According to research by Google and CEB, customers emotionally connected with a brand are twice more likely to buy its products or services.

Almost all these customers (and prospects) are present on social media today. Every minute, the internet sees 973,000 logins into Facebook, 38 million WhatsApp messages, 481,000 tweets and 174,000 scrolls on Instagram.

These numbers are mind-blowing. And it shows how much brands are missing out on the opportunity to engage with their customers and prospects. On the other hand, businesses that leverage social media and make it part of their client relation strategy, enjoy much larger benefits.

Social media offers a goldmine of information about customers and prospects. So, social media CRM tools give a business the edge over its competition by empowering it to delight its customers and prospects.

Here are 4 ways in which social media makes a company’s CRM more intelligent and effective:

Marketing and sales are not all about trying to get new customers. They’re about fostering current relationships, constantly adding value to your customers and creating top-of-mind awareness.

In today’s age, the customer wants to be educated and engaged with instead of being sold to. That’s why it’s important to track your customer’s journey on each stage, and respond to him accordingly. Integrating social media as part of CRM helps you track this aspect and identify how you can eventually convert one-time buyers into advocates.

An integrated engagement platform
Various customers and prospects connect with brands through different platforms. Keeping up with all this at the same time can become a daunting task for concerned teams.

An intelligent CRM tool with social media integrated in it allows your team to have access to all the customer and prospect insights and information in a single location.

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Spending On CRM Apps Predicted To Soar In 2018

These and many other fascinating insights are from two research notes from Cowen published on May 29^th, Cowen IT Spending Survey: Positive Momentum Continues and Takeaways from Cowen’s IT Spending Survey On Apps, Database, and Analytics (both client access reqd.)  The Cowen IT Spending Survey was conducted during April & May 2018. It’s the largest the firm has ever completed, interviewing 157 senior IT professionals across key industries with material IT budgets. Respondents are limited to senior technology professionals with roles including CIO (31%), CTO (27%), Chief Data or Digital Officer (4%), and Senior IT Management (38%). In aggregate 62% of total respondents are in technology C-suite roles.

Industries represented include Communications & Media (34%), Financial Services (24%), Healthcare (10%), Consumer Packaged Goods and Retail (8%), Auto & Manufacturing (4%), Business Services (4%), Energy & Industrials (4%), Real Estate (3%), Food & Beverage (1%); and Other (6%). Please see pages 9 and 10 of the Cowen IT Spending Survey: Positive Momentum Continues and Takeaways for additional details on the methodology.

Key takeaways from the study include the following:

• Sales & Marketing are the top two spending priorities in SaaS, suggesting that demand remains strong for Salesforce (NYSE: CRM) and ADBE (NASDAQ: ADBE). Cowen sees this as indicating companies are continuing to invest in front-office applications to drive customer-facing digital transformation initiatives. Cowen found technology C-level execs are most increasing their spending this year on Marketing, Service and Sales-related SaaS projects (all of which are in included in the CRM category of the survey). CRM is far and away leading all budget growth priorities in 2018. Salesforce Automation (SFA) moved from 3^rd in the Cowen December 2017 survey to 1^st in this one. Cowen found that technology C-level execs continue to place a high priority for innovation on front-office applications, particularly Sales & Marketing, with the goal of digitally transforming their businesses to sharpen the focus on top-line revenue growth strategies and plans.

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Tact $27M Series C attracts Amazon, Microsoft and Salesforce

It’s not often you can get three cloud giants like Amazon,  Microsoft  and Salesforce  to agree on much of anything, but today they were all part of a $27 million Series C investment in Tact.ai, a startup that has been trying to change the way sales people interact with information in CRM systems using voice.

Amazon Alexa Fund, Salesforce Ventures and M12 (formerly Microsoft Ventures) joined Comcast Ventures as strategic investors in the company this round. Traditional VCs Accel Partners, Redpoint Ventures and Upfront Ventures also participated. Tact has now raised over $53 million, according to Crunchbase.

Amazon is of course deeply invested in voice interfaces and has recognized what Tact is trying to do in an enterprise setting with this investment. In fact, Tact was one of the first services to launch as part of Alexa for Business last fall. “Just as people were quick to adopt voice technology in the home, we see an enormous opportunity for voice services in the enterprise,” Paul Bernard, Director of the Amazon Alexa Fund said. He sees Tact on the forefront of that movement.

As though to prove Amazon’s point, the company also announced a product enhancement to improve the voice experience in the car. The feature dubbed ‘Voice Intelligence’ acts like a car-based virtual assistant. Sales people spend much of their time in the car, and the tool can not only give them the basics about the next meeting, it can also provide details about the deal and other relevant information, such as recently filed service tickets. All of this info can arm the salesperson for a potentially more effective meeting, Tact CEO Chuck Ganapathi explained.

“We want sales professionals who are on the road, keeping their eyes on the road ahead, so we are pushing information to them and initiating a conversation, which is exactly what a human assistant would do,” he said.

Ganapathi understands the limitations of CRM tools perhaps better than anyone. That’s because before he started Tact, he had been helping build them for more than 20 years — first custom systems with Ernst and Young, then on prem with Siebel Systems and finally with Salesforce in the cloud.

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The Issue Isn’t the CRM, It’s You

Throughout my career, I’ve had managers tell me how to do a task (incorrectly), why I should support their views (though I had my own views), and why agreeing with their decision is good for the firm (with a pat on my back and a smile on their faces). If these one-sided statements sound like your CRM buy-in strategy, then your firm’s low adoption rate shouldn’t be a surprise.

Many CRM conversations with advisors center around workflow bottlenecks, out-of-date data fields, and staff that won’t use it. Advisors believe that a new CRM will do the trick. It won’t, unless you start at the beginning – your people.

There’s a reason “people” is listed first in the phrase “people, process, and technology.” A high CRM adoption rate is dependent on your staff’s comfort level with it. Without their willingness to embrace it, you can end up with several CRMs – otherwise known as spreadsheets. Understand these firm-wide acceptance issues before looking for a new CRM:

• Either the CRM is easily navigable or confusing: People process information differently. Some people can easily navigate through clicks and screens to retrieve data and follow workflows. Others find it difficult to navigate and label the CRM confusing, clunky, or useless (words from my clients). The latter group is usually branded as not tech-savvy, which isn’t the case. The majority of workflow bottlenecks result from people who prefer following their own instincts rather than what the technology dictates.

• Staff understands integration isn’t seamless. They must manually gather or export data, from multiple sources, into a spreadsheet, then format and upload the data. As one vendor said to my client: “Our software seamlessly integrates with your CRM through CSV (comma-separated values).” This is really an export/import process, which is not seamless. Some people prefer to leave the data in the spreadsheet or refer to the original source.

• Inconsistent data field usage leads to more spreadsheets. When I ask advisors to define household or AUM, they realize their answers don’t apply to all clients. Other data fields have the same issue. Your staff knows which CRM data fields are inaccurate or out-of-date and can point to the spreadsheets with accurate client data.

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Aptean Announces Partnership With MACS EU to Increase Presence in Benelux Markets

Aptean, a leading global provider of mission-critical, industry-specific enterprise software solutions, has formed a strategic partnership with MACS EU in Son en Breugel, Netherlands. This partnership is another key milestone in Aptean’s continued growth strategy in the European market, specifically the Benelux region.

MACS EU will sell and support Aptean’s industry-leading Manufacturing Execution System, Aptean Factory MES. Process and discrete manufacturers use Factory MES to gain real-time visibility into production and quality operations, enabling the transition toward a paperless floor. MACS EU serves customers that manufacture products ranging from carpets to cardboard boxes, from pharmaceuticals to ceramic tiles, and from aluminum extrusion to confectionary.

“We are proud to become an Aptean partner and look forward to the opportunity to deliver Factory MES as part of our solutions portfolio. The out-of-the-box offering will prove to be very attractive for many of our customers as it will offer a faster implementation with fewer customizations,” said Guus de Nijs, CEO for MACS EU. “Working with Aptean, we look forward to helping our customers maximize efficient, productive output and labor productivity.”

MACS EU’s presence as a manufacturing consultancy across Europe will help Aptean better serve its customers in the Benelux region of Europe. In turn, Aptean will rely on MACS EU’s expertise in addressing key manufacturing industry challenges.

“We are delighted to welcome MACS EU as an Aptean partner,” said Alan Somerville, managing director of Aptean EMEA. “We are expanding Aptean Factory MES across Europe, and partnering with trusted names in manufacturing technology gives both us and manufacturers peace of mind. We expect MACS EU will be a great help in bringing more factories under the Aptean umbrella.”

Source: Nasdaq GlobeNewswire

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When Bringing Equipment Into The Industrial IoT, Choose The Method That Is ‘Just Right’

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​LG Uplus to deploy home IoT to Wooshin apartments

South Korean telco LG Uplus will deploy its home Internet of Things (IoT) platform to Wooshin Construction’s apartments, the company has announced.

It will start with 1,664 households in Geumwang Wooshin Rieon Class apartments at Eumseong district, North Chungcheong Province.

Those who live in the apartments can download LG Uplus’s IoT@home app and use it to control heating, lights, and gas in their homes and check their energy usage and parking space availability.

They can also use it to control IoT devices bought separately such as robot cleaners and air purifiers.

Users can also configure the setting to activate them simultaneously at scheduled times. For example, the lights, gas units, and boilers can be set to be turned off when the user leaves the home.

Afterwards, LG Uplus will expand deployment to other and new apartments provided by Wooshin, it said.

The company currently has agreements in place with 80 construction firms to deploy its IoT services.

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Global Internet of Things (IoT) Markets, 2015-2018 & 2024: Annual Estimates & Forecasts – Number of Connected Devices in Million Units

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Will Manufacturers Ride The Servitatization Wave To Greater Profitability?

The servitization megatrend is upon us. Product-driven companies are adding services revenue streams and business models, usually to augment but sometimes to replace product-based business.

WHAT IS SERVITIZATION, AND WHY IS IT HAPPENING?

When a major change or megatrend happens, there is usually not just a single reason. Multiple forces push a culture, society or economy inexorably in a single direction. Servitization is driven in part by limited opportunity for many product-centric companies to grow in terms of product revenue and profits—due to factors like downward price pressure, volatile demand and increasing prices for inputs and raw materials. In other markets like machine tools, lumpy year-over-year business may make the stable, recurring revenue of services attractive.

Aftermarket services may also make the customer more dependent, as they push off important value-added services like maintenance, operation and asset lifecycle management onto the supplier. This may insulate the vendor from competitors. It also enables a vendor to access deep insights on how their customer is using their products, which can in turn drive a consultative selling process.

But enabling technologies are also making servitization more feasible. The internet of things (IoT) is enabling companies to sensor products they sell and use the resulting data stream to automate everything from re-order to dispatch of a service technician.

A recent report from McKinsey suggests that while margin on new product sales is typically 10 percent, aftermarket service margin averages 25 percent.

But actually realizing that revenue poses some significant management and enterprise software problems. Executives will need to live increasingly in the mental future—planning around not only the product lifecycle but the service cost and revenue cycle. When the service agreement is sold, a company will be committing to deliver against a contract that they could make or lose money on for years.

“To gain clarity and remain competitive, they must undertake a more detailed examination of aftermarket lifetime value—the total revenue they receive from servicing their installed base,” the report states. “This measure, which is typically calculated for each product line, provides a more comprehensive view of aftermarket value than commonly used metrics, such as service revenue captured per customer.”

Now, a 2018 IFS study of 200 North American manufacturing and industrial executivesdelivers insights into the extent of servitization and its impact on profitability and the extent of their adoption of service lifecycle and field service management technologies.

CURRENT PROGRESS TOWARDS SERVITIZATION

Among respondents to the IFS study, the majority had some type of aftermarket revenue stream, even if that revenue stemmed strictly from aftermarket parts sales. The smallest segment was those who had servitized completely—essentially doing away with product revenue and charging for a product by duty cycle, usage or some other metric.

• 38 percent of respondents sold only products, with no aftermarket or other service revenues.
• 19 percent sold products and some aftermarket service parts.
• 15 percent sold products and aftermarket field service through break-fix repair.
• 16 percent sold planned maintenance contracts with service level agreements (SLAs).
• Only 4 percent of respondents reported full servitization—selling products on a subscription rather than a discrete item through power-by-the-hour, fee-for-usage or revenue sharing agreements. Companies operating in this fully-servitized business model include:
  • 22 percent of medical device manufacturers
  • 5 percent of metal fabrication businesses
  • 5 percent of companies in the oil and gas industry

Read the study by downloading the Industrial servitization and field service technologywhite paper.

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CIA Official: Cloud Is More Secure Than Old Tech, Less ‘Soul-Crushing’

Federal officials have for years cited cybersecurity as one of their top concerns when moving to the cloud, but a top tech official at the CIA said the technology is better equipped than any legacy system to house the country’s most valuable secrets.

“Security is an absolutely existential need for everything we do at the agency—the cloud on its weakest day is more secure than a client service solution,” said Sean Roche, associate deputy director at the CIA’s Digital Innovation Directorate. “Encryption runs seamlessly on multiple levels. It’s been nothing short of transformational.”

Four years ago, the CIA inked a $600 million contract with Amazon Web Services to provide the intelligence community with commercial cloud services. Called C2S, the cloud serves the CIA and 16 other IC agencies, hosting secret and top secret classified information.

Speaking Wednesday at the AWS Public Sector Summit, Roche presented cloud services as a streamlined, user-friendly alternative to the “cacophony” of legacy systems today’s IT specialists are “desperately” trying to upgrade at organizations across government.

Retrofitting often decades-old tech with new security software leaves agencies constantly behind on defending against the latest digital threats, especially when groups don’t always understand how those systems are configured, according to Roche.

Federal officials have said government won’t fully maximize the benefits of the cloud until it focuses more on the opportunities it can provide than worrying about cybersecurity, and indeed many agencies with particularly sensitive information have begun to overcome these fears. The National Security Agency is moving all of its mission data to a classified cloud environment, and the Pentagon is planning to use it’s long-awaited JEDI cloud to hold data as sensitive as nuclear secrets.

But security benefits go beyond the cloud’s robust architecture, he said. Going to the cloud also gives access to more software-as-a-service solutions, bypassing the traditional acquisition process that can leave agencies waiting months or years to get their hands on innovative tech.

The current acquisition process “crushes souls,” said Roche. “It takes too much time. Commercial and private companies doing no business with the government have to have an on-ramp in.”

Through the cloud, agencies can vet new tools and have them up and running in the field in a matter of months, he said. Groups can also easily update that software as new versions come out. AWS introduced a classified version of its Marketplace feature to the C2S cloud, which gives the CIA and other IC agencies the ability to spin up software in the cloud and test it out before buying. Officials say this gives the IC the ability to make use of innovative software solutions they might not otherwise have access to through government’s traditional acquisition processes.

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Article Credit: NextGov

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Five Common Cloud Misconceptions

There are deep-rooted misconceptions about what the cloud is and where it is headed. This article corrects some of these common misconceptions.

Misconception No. 1: The Cloud Is A Place In The Sky

Most people associate the word “cloud” with the services provided by public clouds such as Amazon Web Services (AWS) or Microsoft Azure, but actually, this is not the case. The best way to think about the cloud is as an experience. It can be from the public cloud or from private clouds in your own data center or a hosted data center. The cloud experience includes:

• Elimination of IT staff for infrastructure management

• Self-service

• Paying only for what you use

• Multiclient support

Misconception No. 2: Public Clouds Are For Modern Workloads; Private Clouds Are For Legacy Workloads

Customers are running modern workloads on both public and private clouds today. Some modern workloads are better in private clouds, and some better in public clouds.

From personal analysis and confirmed elsewhere, I know that predictable workloads, whose infrastructure needs are well understood, are cheaper to run on private clouds than public clouds. The economics have not changed much over the two years I have been doing this analysis. Additionally, laws or corporate policies that require enterprise data to be in certain locations may make private cloud the only choice.

On the other hand, if the workload is dynamic and elasticity is important, the public cloud is superior. Also, if developers need to rapidly integrate voice recognition, natural language processing or other such services, the public cloud is the better choice. Finally, the public cloud is the fastest way to launch a new project.

The notion that most workloads will eventually migrate to the public cloud is incorrect. If this were true, we would not see public cloud vendors get into the private cloud business, as Microsoft is doing with Azure Stack or IBM is with IBM Cloud Private.

Misconception No. 3: Public Clouds Are Adding Capability So Fast That Private Clouds Will Be Left Behind

Private clouds have also evolved rapidly in recent years. They are easy to use, cost-effective, often come in appliance form and reduce or eliminate the need for the customer to manage infrastructure and support capabilities such as platform as a service (PaaS) and serverless that were first associated with public clouds.

There is no question that public clouds are adding new services faster than private clouds. AWS, the public cloud leader, introduced 1,300 new features in 2017, or 3.5 new features a day! However, it is also well documented that 85% of AWS public cloud revenue comes from fewer than five of these services, out of the thousands available. It is my view that these popular services will always be available on private clouds.

One of the most popular new features that AWS introduced to benefit developers is a new way of programming called serverless — AWS Lambda.

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Article Credit: Forbes

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11 ways to keep information safer in the cloud

With data breaches everywhere these days, it seems harder and harder to keep information safe. Fortunately, there are steps you can take to be a bit safer online. We asked members of the Young Entrepreneur Council for tips on what anyone can do to better protect themselves online.

It seems like we’re hearing of a new data breach each month, giving companies transitioning to the cloud plenty reason to feel vulnerable. What’s your best tip for ensuring data security in the cloud?

Their best answers are below:

1. Use two-factor authentication

Using two-factor authentication and, where unique, cycled temporary passwords are sent to a device tend to be much safer for remote usage and security protocol. – Russell Kommer, eSoftware Associates Inc

2. Get cybersecurity insurance

Despite your best efforts, it is hard to prevent a motivated, skilled hacker. We recommend all of our clients who are storing sensitive information in the cloud to get a cybersecurity insurance policy to help protect them if there is a malicious attack on their company’s data. – Doug Bend, Bend Law Group, PC

3. Perform annual security assessments

As a web-based healthcare company with access to PHI protected by federal law, security is paramount to customer confidence in our solutions. Security is not our expertise, so we invest annually in professional security assessments where experts test our solutions, try to breach our system and provide feedback on areas of vulnerabilities. It’s a huge investment, but it’s absolutely essential. – Amanda Elms, Metis Genetics, LLC

4. Encrypt data locally

Cloud storage services that offer local data encryption provides two levels of security. In order to gain access to data, it will have to be decrypted. This is important because this means service providers and administrators can’t get to the information. Taking this step ensures better privacy and a lot fewer headaches down the line. – Blair Thomas, eMerchantBroker

5. Invest in online security protection

Hackers are criminals, but they’re also geniuses. As technology continues to advance, hackers are one step behind, trying to find a way to breach data. The only way you can ensure that your company’s data is truly protected is by investing in online security services that can detect the first sign of illegal activity. – Patrick Barnhill, Specialist ID, Inc.

6. Rely on a good provider

Depending on how you are utilizing the cloud to transmit and store data, security is dictated by the cloud provider. For example, companies like itopia, that deploy and manage Windows cloud desktops, rely on Google’s Cloud to run their business. Google has exceptional data security that regularly undergoes independent security testing. Choose wisely. – Nick Chasinov, Teknicks

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Article Credit: TNW

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Linux: The new frontier of enterprise in the cloud

Everyone from developer teams, to operations, to managers of virtual machines now needs to know Linux, said Red Hat’s Brian Gracely.

TechRepublic’s Dan Patterson spoke with with Brian Gracely, director of cloud strategy at Red Hat OpenShift, about Linux and the cloud.

Patterson: Linux, is the next frontier, the bold next frontier of the enterprise… Red Hat has been around for years. It’s a fantastic distribution of Linux. Help us understand how Red Hat is being adopted and used in the enterprise.

Gracely: Well obviously, like you mentioned, we’ve been a Linux company for a long time. We’ve really seen Linux expand along the lines of a lot of the things that are happening in the enterprise. We’re seeing more and more enterprise infrastructure become software centric or software defined. Red Hat’s expanded their portfolio in storage, in automation with the Ansible platform.

And then the really big trend lately with Linux has been Linux containers and technologies like [Google] Cooper Netties. So, we’re seeing enterprises want to build new applications. We’re seeing the infrastructure be more software defined. Linux ends up becoming the foundation for a lot of the things going on in enterprise IT these days.

Patterson: And how can employers find the employees that have the right skill sets, and what are the best skill sets for deploying Red Hat in the cloud?

Gracely: Yeah. So I think there’s a couple of core skill sets. One, obviously, we’re seeing more and more Linux system admin, system administrators, who are developing those skills, because those skills are applicable in their own data centers. They’re applicable in the public cloud. That’s a great foundation.

Anybody who’s been a virtualization administrator is really understanding software centric infrastructure, APIs, and so forth. That’s a great skill set to find, and then a lot of people that have been focusing on automation. Whether you’ve been learning Chef, Ansible, Puppet, those types of skills, all of those are really great foundational things. They’re not unicorn skills that you’re not going to find anywhere. They’re skills you could find all over the country.

Patterson: Speaking of skills, why is it … it almost feels a little redundant to ask this, but it’s important. Why is it that employees should have a diverse set of Linux skills when working in IT?

Gracely: Well, I think the biggest thing is more and more companies are saying, “Look, the interaction that we’re going to have with our marketplace, with our customers, is going to be digital. It’s going to be through software.” What that ultimately means is I want my developers to be able to build features faster, interact faster, make changes. You’re seeing more ops teams and development teams having to work more closely together. That whole set of infrastructure and the tools they’re using tend to be Linux based.

The more you can have people that understand Linux tooling, automation, software-defined types of things, the more you’re going to have consistency of how developers talk to operators, being able to roll out software more quickly, but ultimately, you respond to your marketplace better. You respond better to what your customers want.

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Article Credit: TechRepublic

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What is Google doing with AI? Chips with Everything podcast

In April 2017, the US Department of Defense launched an Algorithmic Warfare Cross-Functional Team, otherwise known as Project Maven. The project uses Google’s artificial intelligence to analyse drone footage.

This did not go down well with Google’s employees. More than 3,000 workers signed an open letter to Google CEO Sundar Pichai, asking the company to pull out of the program, writing that “Google should not be in the business of war”.

In early June 2018, reports surfaced that Google had informed employees it would not renew its contract for Project Maven, and days afterwards, Pichai published the blog post AI at Google: our principles, which laid out seven objectives for AI applications to guide Google’s work going forward.

This week, Jordan Erica Webber chats to Dr Yasemin J Erden of St Mary’s University, Sanjay Modgil of Kings College London and Dr Sandra Wachter of the Oxford Internet Institute and the Turing Institute.

The panel of AI experts discuss what Pichai’s objectives could mean in practice and whether or not the AI industry needs to accept the dirty R word – Regulation.

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Article Credit: The Guardian

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AI Weekly: The growing importance of clear AI ethics policies

A little over a week after the fervor surrounding Google’s involvement in the Department of Defense’s Project Maven, an autonomous drone program, showed signs of abating, another machine learning controversy returned to the headlines: local law enforcement deploying Amazon’s Rekognition, a computer vision service with facial recognition capabilities.

In a letter addressed to Amazon CEO Jeff Bezos, 19 groups of shareholders expressed concerns that Rekognition’s facial recognition capabilities will be misused in ways that “violate [the] civil and human rights” of “people of color, immigrants, and civil society organizations.” And they said that it set the stage for sales of the software to foreign governments and authoritarian regimes.

Amazon, for its part, said in a statement that it will “suspend … customer’s right to use … services [like Rekognition]” if it determines those services are being “abused.” It has so far declined, however, to define the bright-line rules that would trigger a suspension.

AI ethics is a nascent field. Consortia and think tanks like the Partnership on AI, Oxford University’s AI Code of Ethics project, Harvard University’s AI Initiative, and AI4All have worked to establish preliminary best practices and guidelines. But Francesca Rossi, IBM’s global leader for AI ethics, believes there’s more to be done.

“Each company should come up with its own principles,” she told VentureBeat in a phone interview. “They should spell out their principles according to the space that they’re in.”

There’s more at stake than government contracts. As AI researchers at tech giants like Google, Microsoft, and IBM turn their attention to health care, the obfuscatory nature of machine learning algorithms runs the risk of alienating those who stand to benefit: patients.

People might have misgivings, for example, about systems that forecast a patient’s odds of survival if the systems don’t make clear how they’re drawing their conclusions. (One such AI from the Google Brain team takes a transparent approach, showing which PDF documents, handwritten charts, and other data informed its results.)

“There’s a difference between a doctor designing therapy for a patient [with the help of AI] and algorithms that can recognize books,” Rossi explained. “We often don’t even recognize our biases when we’re making decisions, [and] these biases can be injected into the training data sets or into the model.”

Already, opaque policies around data collection have landed some AI researchers in hot water. Last year, the Information Commissioner’s Office, the U.K.’s top privacy watchdog, ruled that the country’s National Health Service improperly shared the records of 1.6 million patients in an AI field trial with Alphabet subsidiary DeepMind.

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Despite Potential, AI Has Many Issues To Be Sorted

Artificial intelligence is starting to make its mark on almost every feild and is benefiting enterprises like never before. Despite the momentum, there are several issues enterprises should sort out before AI becomes mainstream. More than one in five professionals work for companies that are deploying artificial intelligence (AI)—and while these employees generally view AI positively, they also have concerns about its potential effects on their privacy, job security, and economic equality. In fact, AI users are both more optimistic about AI’s benefits and more wary of its risks than nonusers. Those are the central findings of a survey of more than 7,000 people conducted in Canada, China, France, Germany, Spain, the UK, and the US by BCG GAMMA and Ipsos, a market research firm.

AI Is Not Coming—It’s Already Here

AI adoption varies widely among countries. In China, 31% of survey respondents say they work in organizations that already use AI, followed by North America (26% in Canada, 24% in the US) and then Europe (20% in the UK; 18% in Spain, 16% in France, and 15% in Germany).

Adoption also varies by sector, but to a lesser extent. A quarter of the workers in manufacturing say that AI is deployed at their companies, compared with 20% in construction, 19% in retail, and 18% in services. The average rate across private sector organizations stands at 20%, whereas 25% of public sector respondents say that AI-enabled tools and applications are already in their workplace.

People Have a Positive View of Increasing Use of AI-Enabled Tools

The vast majority of employees—especially those who already have access to AI—expect it to have positive implications for their organization and for themselves.

In workplaces that use AI-powered tools, more than two-thirds of the employees surveyed say the tools have already had a positive impact on their efficiency (75% cite improvements in their effectiveness, 75% in their results, and 74% in how their work is structured). They also note that AI has had a positive impact on the appeal of their work (70%), on their level of well-being at work (69%), and on the training courses made available to them (67%). A large majority of respondents, regardless of gender, age, or occupation, mention these positive effects.

Workers who have already experienced the benefits of AI tools are even more enthusiastic than others with regard to the likely the impact of AI over the next five years. More than eight in ten think that it will positively affect their organization (84% say it will have a positive impact on their organization’s business growth, and 81% say it will improve the structure of work). More than three in four also expect positive benefits for themselves (77% with regard their level of well-being at work, and 76% with regard to their professional development).

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Article Credit: CXO

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What’s the fuss about AI? Discovery Channel doc explains all

Artificial Intelligence has a bad rap from intelligent folk like Stephen Hawking and Elon Musk. But a new Discovery Channel documentary airing today attempts to find out how AI is already helping people.

From driverless cars to innovations in health care and education, the two-hour documentary special highlights some of the developments and questions in artificial intelligence. It’s a neat introduction to the subject explained by experts in the field and illustrated by examples from the real world.

“Most people don’t know very much about AI and what they do know comes largely from more alarmist stories,” says Charlie Foley, creator and producer of the TV special. Instead of “dystopian Chicken Littles or Cassandras, prophesying doom”, Foley wanted to uncover “the real story of AI”.

Foley quotes American computer scientist Alan Kay, who says “the best way to predict the future is to invent it”. Ultimately, Foley believes there won’t be any field of industry — or life in general — that AI won’t touch.

Backed by IBM, the documentary includes several of the company’s AI advances including Watson, the AI that won game show Jeopardy, and Debater, an AI that can debate intellectuals on a given subject in real time. We also see Google-backed project DeepMind, which created the AlphaGo programme to beat world champions at the board game Go.

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Article Credit: CNET

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