CIO Priorities For 2018: IT Thought Leaders Share Their Predictions

Rod Tansimore

For a provocative look into the near future of technology applications in business, we asked leading members of the SAP ecosystem to share their prophecies. For CIOs, who are rapidly evolving into an advisory role, the demands increasingly call for tough decisions on where to invest: what technologies, what skills, what new business models? Here’s what our gurus have to say.

Mala Anand, SAP, President, SAP Leonardo and Analytics

2018 will be the tipping point for cloud analytics with the growth of cloud data and applications. This trend will fuel demand for end-to-end cloud analytic platforms that deliver a rich set of analytic capabilities to discover, plan, predict, visualize, prepare, collaborate, model, simulate, and manage while leveraging common data logic. The software-as-a-service (SaaS) model offers business a way to take advantage of continual product innovations in a seamless experience with a common user experience, and will address analytical requirements throughout the organization at a lower TCO vs. fragmented solutions that cause inconsistencies and distorted data views.

Christine Ashton, SAP, Digital Office ERP Cloud, Global Chief Digital Officer

2018 will see a fundamental shift in the role of the CIO in businesses that recognize the value of instant, limitless scalability and immediate access to innovation. Postmodern CIOs will become innovation leaders with a seat – and a key voice – among the C-suite. This will mean:
• Moving from operating IT to innovating business operations
• Swapping owning software for leveraging interlocking solutions across an ecosystem
• Shifting from managing teams to growing an inclusive, confident workforce
• Changing the focus from keeping the lights on to delivering differentiation

The driver behind each will be to equip successful, business-wide digital transformation.

Mark Barrenechea, OpenText, CEO and Chief Technology Officer

As IoT-connected devices push the limits of the cloud, a new paradigm where the cloud and edge computing meet will emerge. Edge computing moves processing power closer to the source of data, sending only data worth keeping to the cloud. Reducing costs and stored volumes of IoT-related data, the device itself will process time-sensitive data, quicker and with reduced network latency. As the number of devices continues to increase, edge computing will push the cloud into a supporting role. Together, the cloud and edge computing will provide the infrastructure needed to support the ever-expanding IoT universe. @markbarrenechea, @opentext

Brian Berns, Knoa Software, CEO

Most companies have little to no insight into how their employees are interacting with their ERP software. This lack of visibility is very costly, as it directly leads to a decrease in employee productivity. In 2018, businesses will increasingly adopt user analytics to gain insight into employee engagement with their software suites. This trend will be accelerated by the move to cloud and mobile enterprise solutions, as well as by the increased importance of user experience for a new generation of knowledge workers. User analytics are bound to become a key technology for IT organizations, which will enable them to measure application usage and identify inhibitors to adoption such as clunky user interfaces, process complexity, and heavy customization.

Orlando Cintra, SAP, SVP, SAP Cloud Platform, Latin America & Caribbean

Companies and C levels will realize that IT is the solved part of the equation. That said, they will turn a lot of attention to proving real business cases with high value so they can innovate with real purpose. Companies in an on-premise model will start to see their costs increasing dramatically compared with the cloud, since all the major players’ investments are going to cloud. Finally, innovation experts, data scientists, tech gurus, and specialists with good track records with success innovation projects will be in demand. The market will not produce talent to meet the expected demand. Companies In the niche to prepare new professionals will have big growth.

Ratnang D. Desai, Deloitte Consulting LLP, Managing Director

2018 will be the year when rapid evolution of technology will force organizations to “Reimagine Everything.” It is not enough to simply reengineer a business process. IT will play a critical role in helping organizations reimagine how disruptive technologies such as cognitive, cloud, and blockchain will fundamentally transform all functions. IT will take the next big step in its transformation, as well. IT and the business will work as true partners and collaborate seamlessly to quickly harness the power of disruptive technologies and turn it into a sustained competitive advantage. @ratnangdesai, @DeloitteSAP

Archana Deskus, Hewlett Packard Enterprise, Global Chief Information Officer

We live in a hybrid data and compute world, requiring flexibility and new architectures with sophistication to span edge to core, enabling distributed machine learning systems to distill end-to-end data insights. Increasingly, we will see the use of machine learning to turn that insight into action, in real time, enabling the hypercompetitive enterprise to disrupt business models and industries to create new experiences and revenue models. None of this will be possible without powerful, future-proof software-defined and memory-driven infrastructure that is consumed in novel, flexible ways. Outcomes as a Service will be the ideal IT delivery model going forward.

Mark Dudgeon, IBM, Global SAP Chief Technology Officer

I expect to see adoption of SAP S/4HANA ramp up significantly in 2018, with SAP S/4HANA Cloud providing an increasingly relevant option for organizations. Blockchain will be an increasingly hot topic, with a number of cross-industry and line-of-business use cases starting to come into mainstream – resolving issues with fractured ecosystem networks, providing transparency and single version of the truth across enterprises. Augmented reality (AR) and virtual reality (AR) are niche technologies in the world of business IT, but I expect to see the use cases expanding beyond training and education into areas such as service and maintenance.
Twitter: @MarkPDudgeon
LinkedIn: MarkPDudgeon

Mike Golz, SAP, Senior Vice President and Regional Chief Information Officer, Americas

As digital transformation takes hold and disrupts more industries, companies need to move from declaring it as critical (78% according to a recent Oxford Economics study) to truly committing to a digital strategy (currently at a dismal 3% in the same study). Whether the change primarily affects a company’s business model, its business processes, or the way people work, the underlying technologies, like machine learning, human/digital interfaces, IoT, or blockchain, are fairly well understood by now. Look no further than your phone. Chances are that you are using them as a consumer today. 3-D printing might look like an exception to consumerization; however, my insoles are based on iPhone pictures uploaded to an app.

Paul Lewis, Hitachi Vantara, Chief Technology Officer, Americas

During 2018, the nature of the CIO’s job will change from the role of “delivery executive” to that of “IT business executive,” realigning the focus from project status and infrastructure uptime to delivering on the three business imperatives. These are: operational efficiency, new customer experiences, and diversified business models of the corporations’ digital transformation strategy. People development will also become the primary consideration for innovation in IoT, AI, and cloud, which are creating a necessity to upskill, re-skill, and replace expertise and experience across disciplines by utilizing platforms to access partner ecosystems of talent, technology, and information.

Follow Paul on his BlogTwitter, and LinkedIn.

Greg McStravick, SAP, President of Database and Data Management

Data will continue to explode in 2018. Gartner predicts that 95% of new products will contain IoT capabilities, and that means companies will have to contend with a deluge of information even more voluminous than we see today. Organizations that have taken a wait-and-see approach to data management will be bulldozed over by those that made the early investments to make sense of it. Systems that enable data sharing, pipelining and governance along with intelligent machine learning and artificial intelligence in one connected landscape will be a game changer for every organization that wants to remain competitive. @McStravickGreg

Nathan Pearce, Capgemini UK, SAP Practice, Business Development and Innovation Lead

In 2018, we will witness another year of disruptive technologies. In particular, machine learning, combined with AI and data, will change the game in consumer engagement and personalization to help drive loyalty and advocacy. There will also be further developments upon VR and AR across many sectors. @npearce111

Manik Narayan Saha, SAP, Regional Chief Information Officer, APJ

Customers’ digital experience will continue to drive prioritization for companies around engagement, purchase decisions, and brand loyalty. I expect to see higher polarization between companies offering a great digital experience. AI will start to have an impact on traditional business processes – especially relating to back-office, shared services, and mid-office functions. Cloud will become the de facto standard to run the digital enterprise. Except in regulated industries, there is now even less of a compelling argument not to move to cloud-based services, and benefit from scale, agility, and speed. And I will be closely watching to see how the tech industry responds to EU GDPR, and helps customers make a successful transition. @maniksaha

Thomas Saueressig, SAP, Chief Information Officer, Global Head of IT Services

Machine learning and artificial intelligence will grow out of its experimental, early-adopter stage and hit the tipping point to broad adoption. Intelligent services will expand from consumer focus and supporting processes into the core of the enterprise and will become mainstream by 2019. The most underestimated theme I see will be the EU’s General Data Protection Regulation (GDPR). It will gain momentum in 2018 and eat up a fair amount of enterprises’ innovation capacities. Finally, advances in technology will not only shift our focus to other aspects of the services we offer, but will drastically change the way we work. New innovations are disrupting the status quo with exponential speed, requiring us to continuously adapt and learn.

Ronald van Loon, Simplilearn, Advisory Board Member & Big Data and Analytics Course Advisor

In 2018, machine learning applications will continue to mature, with each vendor featuring a domain-specific solution. Organizations need fully integrated, end-to-end data management platforms to handle increases in different data streams, including deep learning applications, while having the ability to transform this data into actionable insights. AI and deep learning applications in voice recognition and video analytics will also accelerate. Edge analytics will progress, corresponding with the massive increase in connected devices. It provides real-time analytic solutions at any point where data is generated, addressing data management challenges related to large amounts of data that can’t be centrally analyzed.

We invite you to stay tuned to the Digitalist Magazine to see where 2018 takes us. Best wishes for a productive and prosperous New Year.

Where will technology take finance in the coming year? See How Finance Is Thriving In A Digital World: 17 Experts Share Their 2018 Predictions.

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Rod Tansimore

About Rod Tansimore

Rod Tansimore is a senior director of IT Technology Programs at SAP. He started his career as a systems engineer at IBM and moved on to hold numerous leadership roles in product management, product marketing, sales, and market development for large and small technology companies. Rod has B.S. in Engineering from Northwestern University and an MBA from Columbia University.

Why Technology Alone Is Not Enough – Part 1

Bernd Leukert

Part 1 of a 2-part series

There is no doubt that the digital transformation is in full swing. Innovation and technology cycles have become significantly shorter, and driving innovation feels like being in the fast lane on the digital journey highway. Whenever time allows, it’s good to take a moment and think about the direction this journey is taking. I would like to share some thoughts about an important aspect of the digital age that is not only a priority for me, but also for many partners and customers I speak with.

Paradigm shifts don’t come and go overnight

The credo of modern technology is openness. The ease with which we can now switch between technology, software, and devices means we can all expect much greater flexibility going forward. This change requires new approaches to engagement for IT vendors and connectedness for all of us; the role of vibrant ecosystems will become increasingly important. And while new technologies and growing ecosystems boost digital businesses, they also create or increase complexity.

In addition, the move into the digital era is already impacting workplaces globally – since 2000, 52% of the Fortune 500 have either experienced bankruptcy, been acquired, or gone out of business entirely, according to Capgemini. The speed of innovation is continuously increasing, and making use of technological trends such as the Internet of Things, artificial intelligence, and blockchain allows us to optimize and reinvent business processes and introduce new business models. However, the ever-increasing levels of automation will also have an impact on the future of our work.

With these new technological and business opportunities come new or as yet unanswered questions – questions that are fundamental to all of us. How can we build trust in the digital economy? How can new ethical standards evolve and become the norm? How can we create meaningful innovation for a bigger purpose?

Integral aspects of new paradigms

These questions include three main topics that become increasingly important for any technological and economic development in the future: Trust, ethics, and purpose.

The ways in which we interact in our ecosystems are changing fundamentally. We are used to building trust with people, products, and organizations because we know them by having direct interactions with them. At its most basic level, trust means nothing more than believing in the reliability and loyalty of others. In the future, basing trust only on relationships won’t be enough, since networks will become too big and dynamic.

Digital trust – the “what”

We will need technology’s help to cope with the changes related to our ecosystems. Today, for example, people are increasingly trusting blockchain-based networks, such as cryptocurrencies. With blockchain, we already trust in the reliability and loyalty of the network because it delivers digital proof for physical documents and real-life transactions and events. The advantages of this technology are so notable that, according to Gartner, by 2022, a blockchain-based business will be worth $10 billion.

According to Gartner, “digital trust emerges to establish and manage trust in the myriad digital interactions and relationships between businesses, individuals, and things.” This means that trust is and needs to be everywhere to keep businesses running. But with an absence of personal interaction in the digital world, where does this trust come from and what is required to create this “ultimate currency”? What is the relationship between data and trust? How can we design and build technology so that it is fully trustworthy to all parties?

Digital information and information flows

Today, we see an increasing decentralization of raw data. This requires us to find new ways to create value from and manage the complexity and heterogeneity of these distributed data landscapes. We see this in various fields where Big Data is key, including IoT, blockchain, and machine learning.

What all these technology areas have in common is the fact that information flows between large numbers of people, things, and systems that potentially don’t know each other and consequently, don’t (yet) trust each other. Today and in the future, we need to rely on technology to verify the authenticity of data, documents, and processes and provide us with secure and trustworthy access to digitalized information and information flows. This has itself already become an invaluable asset for companies. In the end, it is not only a company’s technology that needs to be trusted, but also the company itself in its role as a product or service provider and partner of choice.

However, technology alone is not enough. Building new digital networks, for example, does not necessarily mean that mechanisms that help keep the system and network running smoothly can be eliminated.

Blockchain as an enabling technology

Going one step further, there is another dimension of trust that technology companies in particular must take into consideration: Their ability to enable their customers to be trustworthy organizations in the digital age. This is something we take very seriously at SAP. One example that shows how digital trust can be created is the blockchain-based verification of documents.

In a co-innovation project between SAP and the autonomous region of Bozen, South Tyrol in Italy, blockchain technology is being used to digitalize and verify the paper-based documentation process flow while the documents themselves remain unchanged. This results in less bureaucracy and increased trust in public administration and, consequently, in completely new organizational models.

Future innovations will require openness and connectedness across entire ecosystems. Trust in the digital world does not only imply trustful relationships between people, but also trust in ecosystems, with the help of technology. The more open and transparent the ecosystems and networks, the more trust they can gain and create.

In the second part of my blog, I will share some thoughts about the “how” and the “why,” addressing the topics of ethics and purpose-driven organizations.

This article original appeared on Business Trends in the SAP Community and is republished by permission.

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Bernd Leukert

About Bernd Leukert

Bernd Leukert is a member of the Executive Board of SAP SE with global responsibility for development and delivery of all products across SAP’s product portfolio.

GDPR: Who Needs To Know And What They Need To Do

Christine Ashton

Part 5 in the “Postmodern CIO” series

It’s beyond debate that data is one of a company’s most valuable resources. The total revenue from online advertising in 2014, for example, reached US $49.5 billion, the majority of which is based on users’ personal and demographic information to show more relevant messages. The direction of travel since then has only been in one direction.

The European Union’s new law, the General Data Protection Regulation (GDPR), focuses on controlling the use of individual persons’ private information and ensuring that it can be protected. If your company violates the regulation, you could face penalties of as much as 4% of your annual global revenue or €20 million, depending on the details and severity of the violation.

To avoid incurring substantial fines, businesses need to plan well in advance on how to deal with the requirements of GDPR. Although the details may vary from one organization to the next, the roles and perspectives listed below are some of the most important for your company to take into account.

CEO and board of directors

These people will mainly be interested in GDPR’s impact on their business processes. This means performing a top-to-bottom review of the relevant personal data that you handle.

CEOs and the board of directors may also want to understand the cost-effectiveness of their data strategy. Are you collecting and access more personal data than necessary? If so, check into reducing this amount. Continuing to accumulate silos of unused and potentially toxic data increases the need for encryption, and therefore will require more investment.

Chief compliance officer (CCO) and chief risk officer (CRO)

The CCO and CRO will focus on articles five and six of GDPR, which define the concepts of “lawful processing” and “accountability.” It remains up to the CCO to demonstrate your company’s compliance by introducing clear company-wide data protection and privacy policies, so that you can respond quickly and with agility to potential breaches.

In addition, the CRO should establish an accountability framework by adding documentation of current risks and controls into the existing internal controls system. This may consist of taking a risk-based approach by assessing the “likelihood and severity of risk” of personal data processing operations.

According to the UK-accountancy firm BDO: “The expectation is that data privacy governance will be strengthened with more robust reporting to Board level and stronger control structures established to ensure the organisation, its employees and third parties are aware of their respective obligations under the GDPR and other data protection legislation… Robust procedures for detecting, reporting, and investigating data breaches need to be established to meet the GDPR requirements.”

Data protection officer (DPO)

Most businesses that market goods or services to customers within the EU and collect their personal data must appoint a data protection officer (DPO). DPOs work on behalf of customers and their privacy, which means that they might often have recommendations that are contrary to the ideas of other data-driven roles.

Data protection officers have a number of jobs to do as the GDPR approaches, including conducting internal data protection assessments to ensure that all matters of data compliance are up-to-date. They should serve as expert advisors to the highest level of management about their obligations under the new law, with advanced knowledge of how to carry out data protection.

It might be work investing in some external assessments like we do with security in the form of “pen tests.”

Chief information officer (CIO) and chief information security officer (CISO)

These roles generally deal with keeping a company’s data safe and making sure that it is being exploited to improve business functions and processes. To prepare for the GDPR, CISOs will:

  • Define your GDPR requirements in your company’s overall security strategy
  • Take responsibility for cybersecurity, including monitoring access to personal data and data breach reporting
  • Limit the access of personal data to authorized employees

Meanwhile, CIOs will typically focus on fulfilling data subjects’ new rights, laid out in article three of the GDPR. These include:

  • The right to provide and revoke consent for processing personal data
  • The right to correct, export and transfer information
  • The right to be forgotten

The CIO does need to have a plan to fully understand where data is stored and which applications and services use it in order to execute on the obligations above.

Final thoughts

Regardless of titles and roles, organizations adhering to the GDPR must establish comprehensive programs to address these key areas of data protection. The more automated these programs are, and the more they’re integrated with existing business applications and audit and compliance tools, the more effective and cost-efficient they will be.

Find out more about turning GDPR compliance into a growth opportunity.

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Christine Ashton

About Christine Ashton

Christine is global chief digital officer, Digital Office ERP Cloud at SAP. Her focus is to work with CxOs to reimagine strategy and business practices. She works with senior executives to plan their “AI-first” digital transformation road map enabled by intelligent ERP and public cloud. Notably, Christine is recognized in Computer Weekly’s 2017’s Most Influential Women In IT – Top 100 list.

Why Strategic Plans Need Multiple Futures

By Dan Wellers, Kai Goerlich, and Stephanie Overby , Kai Goerlich and Stephanie Overby

When members of Lowe’s Innovation Labs first began talking with the home improvement retailer’s senior executives about how disruptive technologies would affect the future, the presentations were well received but nothing stuck.

“We’d give a really great presentation and everyone would say, ‘Great job,’ but nothing would really happen,” says Amanda Manna, head of narratives and partnerships for the lab.

The team realized that it needed to ditch the PowerPoints and try something radical. The team’s leader, Kyle Nel, is a behavioral scientist by training. He knows people are wired to receive new information best through stories. Sharing far-future concepts through narrative, he surmised, could unlock hidden potential to drive meaningful change.

So Nel hired science fiction writers to pen the future in comic book format, with characters and a narrative arc revealed pane by pane.

The first storyline, written several years before Oculus Rift became a household name, told the tale of a couple envisioning their kitchen renovation using virtual reality headsets. The comic might have been fun and fanciful, but its intent was deadly serious. It was a vision of a future in which Lowe’s might solve one of its long-standing struggles: the approximately US$70 billion left on the table when people are unable to start a home improvement project because they can’t envision what it will look like.

When the lab presented leaders with the first comic, “it was like a light bulb went on,” says Manna. “Not only did they immediately understand the value of the concept, they were convinced that if we didn’t build it, someone else would.”

Today, Lowe’s customers in select stores can use the HoloRoom How To virtual reality tool to learn basic DIY skills in an interactive and immersive environment.

Other comics followed and were greeted with similar enthusiasm—and investment, where possible. One tells the story of robots that help customers navigate stores. That comic spawned the LoweBot, which roamed the aisles of several Lowe’s stores during a pilot program in California and is being evaluated to determine next steps.

And the comic about tools that can be 3D-printed in space? Last year, Lowe’s partnered with Made in Space, which specializes in making 3D printers that can operate in zero gravity, to install the first commercial 3D printer in the International Space Station, where it was used to make tools and parts for astronauts.

The comics are the result of sending writers out on an open-ended assignment, armed with trends, market research, and other input, to envision what home improvement planning might look like in the future or what the experience of shopping will be in 10 years. The writers come back with several potential story ideas in a given area and work collaboratively with lab team members to refine it over time.

The process of working with writers and business partners to develop the comics helps the future strategy team at Lowe’s, working under chief development officer Richard D. Maltsbarger, to inhabit that future. They can imagine how it might play out, what obstacles might surface, and what steps the company would need to take to bring that future to life.

Once the final vision hits the page, the lab team can clearly envision how to work backward to enable the innovation. Importantly, the narrative is shared not only within the company but also out in the world. It serves as a kind of “bat signal” to potential technology partners with capabilities that might be required to make it happen, says Manna. “It’s all part of our strategy for staking a claim in the future.”

Planning must become completely oriented toward—and sourced from—the future.

Companies like Lowe’s are realizing that standard ways of planning for the future won’t get them where they need to go. The problem with traditional strategic planning is that the approach, which dates back to the 1950s and has remained largely unchanged since then, is based on the company’s existing mission, resources, core competencies, and competitors.

Yet the future rarely looks like the past. What’s more, digital technology is now driving change at exponential rates. Companies must be able to analyze and assess the potential impacts of the many variables at play, determine the possible futures they want to pursue, and develop the agility to pivot as conditions change along the way.

This is why planning must become completely oriented toward—and sourced from—the future, rather than from the past or the present. “Every winning strategy is based on a compelling insight, but most strategic planning originates in today’s marketplace, which means the resulting plans are constrained to incremental innovation,” says Bob Johansen, distinguished fellow at the Institute for the Future. “Most corporate strategists and CEOs are just inching their way to the future.” (Read more from Bob Johansen in the Thinkers story, “Fear Factor.”)

Inching forward won’t cut it anymore. Half of the S&P 500 organizations will be replaced over the next decade, according to research company Innosight. The reason? They can’t see the portfolio of possible futures, they can’t act on them, or both. Indeed, when SAP conducts future planning workshops with clients, we find that they usually struggle to look beyond current models and assumptions and lack clear ideas about how to work toward radically different futures.

Companies that want to increase their chances of long-term survival are incorporating three steps: envisioning, planning for, and executing on possible futures. And doing so all while the actual future is unfolding in expected and unexpected ways.

Those that pull it off are rewarded. A 2017 benchmarking report from the Strategic Foresight Research Network (SFRN) revealed that vigilant companies (those with the most mature processes for identifying, interpreting, and responding to factors that induce change) achieved 200% greater market capitalization growth and 33% higher profitability than the average, while the least mature companies experienced negative market-cap growth and had 44% lower profitability.

Looking Outside the Margins

“Most organizations lack sufficient capacity to detect, interpret, and act on the critically important but weak and ambiguous signals of fresh threats or new opportunities that emerge on the periphery of their usual business environment,” write George S. Day and Paul J. H. Schoemaker in their book Peripheral Vision.

But that’s exactly where effective future planning begins: examining what is happening outside the margins of day-to-day business as usual in order to peer into the future.

Business leaders who take this approach understand that despite the uncertainties of the future there are drivers of change that can be identified and studied and actions that can be taken to better prepare for—and influence—how events unfold.

That starts with developing foresight, typically a decade out. Ten years, most future planners agree, is the sweet spot. “It is far enough out that it gives you a bit more latitude to come up with a broader way to the future, allowing for disruption and innovation,” says Brian David Johnson, former chief futurist for Intel and current futurist in residence at Arizona State University’s Center for Science and the Imagination. “But you can still see the light from it.”

The process involves gathering information about the factors and forces—technological, business, sociological, and industry or ecosystem trends—that are effecting change to envision a range of potential impacts.

Seeing New Worlds

Intel, for example, looks beyond its own industry boundaries to envision possible future developments in adjacent businesses in the larger ecosystem it operates in. In 2008, the Intel Labs team, led by anthropologist Genevieve Bell, determined that the introduction of flexible glass displays would open up a whole new category of foldable consumer electronic devices.

To take advantage of that advance, Intel would need to be able to make silicon small enough to fit into some imagined device of the future. By the time glass manufacturer Corning unveiled its ultra-slim, flexible glass surface for mobile devices, laptops, televisions, and other displays of the future in 2012, Intel had already created design prototypes and kicked its development into higher gear. “Because we had done the future casting, we were already imagining how people might use flexible glass to create consumer devices,” says Johnson.

Because future planning relies so heavily on the quality of the input it receives, bringing in experts can elevate the practice. They can come from inside an organization, but the most influential insight may come from the outside and span a wide range of disciplines, says Steve Brown, a futurist, consultant, and CEO of BaldFuturist.com who worked for Intel Labs from 2007 to 2016.

Companies may look to sociologists or behaviorists who have insight into the needs and wants of people and how that influences their actions. Some organizations bring in an applied futurist, skilled at scanning many different forces and factors likely to coalesce in important ways (see Do You Need a Futurist?).

Do You Need a Futurist?

Most organizations need an outsider to help envision their future. Futurists are good at looking beyond the big picture to the biggest picture.

Business leaders who want to be better prepared for an uncertain and disruptive future will build future planning as a strategic capability into their organizations and create an organizational culture that embraces the approach. But working with credible futurists, at least in the beginning, can jump-start the process.

“The present can be so noisy and business leaders are so close to it that it’s helpful to provide a fresh outside-in point of view,” says veteran futurist Bob Johansen.

To put it simply, futurists like Johansen are good at connecting dots—lots of them. They look beyond the boundaries of a single company or even an industry, incorporating into their work social science, technical research, cultural movements, economic data, trends, and the input of other experts.

They can also factor in the cultural history of the specific company with whom they’re working, says Brian David Johnson, futurist in residence at Arizona State University’s Center for Science and the Imagination. “These large corporations have processes and procedures in place—typically for good reasons,” Johnson explains. “But all of those reasons have everything to do with the past and nothing to do with the future. Looking at that is important so you can understand the inertia that you need to overcome.”

One thing the best futurists will say they can’t do: predict the future. That’s not the point. “The future punishes certainty,” Johansen says, “but it rewards clarity.” The methods futurists employ are designed to trigger discussions and considerations of possibilities corporate leaders might not otherwise consider.

You don’t even necessarily have to buy into all the foresight that results, says Johansen. Many leaders don’t. “Every forecast is debatable,” Johansen says. “Foresight is a way to provoke insight, even if you don’t believe it. The value is in letting yourself be provoked.”

External expert input serves several purposes. It brings everyone up to a common level of knowledge. It can stimulate and shift the thinking of participants by introducing them to new information or ideas. And it can challenge the status quo by illustrating how people and organizations in different sectors are harnessing emerging trends.

The goal is not to come up with one definitive future but multiple possibilities—positive and negative—along with a list of the likely obstacles or accelerants that could surface on the road ahead. The result: increased clarity—rather than certainty—in the face of the unknown that enables business decision makers to execute and refine business plans and strategy over time.

Plotting the Steps Along the Way

Coming up with potential trends is an important first step in futuring, but even more critical is figuring out what steps need to be taken along the way: eight years from now, four years from now, two years from now, and now. Considerations include technologies to develop, infrastructure to deploy, talent to hire, partnerships to forge, and acquisitions to make. Without this vital step, says Brown, everybody goes back to their day jobs and the new thinking generated by future planning is wasted. To work, the future steps must be tangible, concrete, and actionable.

Organizations must build a roadmap for the desired future state that anticipates both developments and detours, complete with signals that will let them know if they’re headed in the right direction. Brown works with corporate leaders to set indicator flags to look out for on the way to the anticipated future. “If we see these flagged events occurring in the ecosystem, they help to confirm the strength of our hypothesis that a particular imagined future is likely to occur,” he explains.

For example, one of Brown’s clients envisioned two potential futures: one in which gestural interfaces took hold and another in which voice control dominated. The team set a flag to look out for early examples of the interfaces that emerged in areas such as home appliances and automobiles. “Once you saw not just Amazon Echo but also Google Home and other copycat speakers, it would increase your confidence that you were moving more towards a voice-first era rather than a gesture-first era,” Brown says. “It doesn’t mean that gesture won’t happen, but it’s less likely to be the predominant modality for communication.”

How to Keep Experiments from Being Stifled

Once organizations have a vision for the future, making it a reality requires testing ideas in the marketplace and then scaling them across the enterprise. “There’s a huge change piece involved,”
says Frank Diana, futurist and global consultant with Tata Consultancy Services, “and that’s the place where most
businesses will fall down.”

Many large firms have forgotten what it’s like to experiment in several new markets on a small scale to determine what will stick and what won’t, says René Rohrbeck, professor of strategy at the Aarhus School of Business and Social Sciences. Companies must be able to fail quickly, bring the lessons learned back in, adapt, and try again.

Lowe’s increases its chances of success by creating master narratives across a number of different areas at once, such as robotics, mixed-reality tools, on-demand manufacturing, sustainability, and startup acceleration. The lab maps components of each by expected timelines: short, medium, and long term. “From there, we’ll try to build as many of them as quickly as we can,” says Manna. “And we’re always looking for that next suite of things that we should be working on.” Along the way certain innovations, like the HoloRoom How-To, become developed enough to integrate into the larger business as part of the core strategy.

One way Lowe’s accelerates the process of deciding what is ready to scale is by being open about its nascent plans with the world. “In the past, Lowe’s would never talk about projects that weren’t at scale,” says Manna. Now the company is sharing its future plans with the media and, as a result, attracting partners that can jump-start their realization.

Seeing a Lowe’s comic about employee exoskeletons, for example, led Virginia Tech engineering professor Alan Asbeck to the retailer. He helped develop a prototype for a three-month pilot with stock employees at a Christiansburg, Virginia, store.

The high-tech suit makes it easier to move heavy objects. Employees trying out the suits are also fitted with an EEG headset that the lab incorporates into all its pilots to gauge unstated, subconscious reactions. That direct feedback on the user experience helps the company refine its innovations over time.

Make the Future Part of the Culture

Regardless of whether all the elements of its master narratives come to pass, Lowe’s has already accomplished something important: It has embedded future thinking into the culture of the company.

Companies like Lowe’s constantly scan the environment for meaningful economic, technology, and cultural changes that could impact its future assessments and plans. “They can regularly draw on future planning to answer challenges,” says Rohrbeck. “This intensive, ongoing, agile strategizing is only possible because they’ve done their homework up front and they keep it updated.”

It’s impossible to predict what’s going to happen in the future, but companies can help to shape it, says Manna of Lowe’s. “It’s really about painting a picture of a preferred future state that we can try to achieve while being flexible and capable of change as we learn things along the way.” D!


About the Authors

Dan Wellers is Global Lead, Digital Futures, at SAP.

Kai Goerlich is Chief Futurist at SAP’s Innovation Center Network.

Stephanie Overby is a Boston-based business and technology journalist.


Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.

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Dan Wellers

About Dan Wellers

Dan Wellers is founder and leader of Digital Futures at SAP, a strategic insights and thought leadership discipline that explores how digital technologies drive exponential change in business and society.

Kai Goerlich

About Kai Goerlich

Kai Goerlich is the Chief Futurist at SAP Innovation Center network His specialties include Competitive Intelligence, Market Intelligence, Corporate Foresight, Trends, Futuring and ideation.

Share your thoughts with Kai on Twitter @KaiGoe.heif Futu

About Stephanie Overby

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Future Of Work 2018: 10 Predictions You Can’t Ignore

Steven Hunt

The start of winter is often referred to as the “holiday season.” But it might also be called the “prediction season.” When it comes to human capital management (HCM), most predictions tend to be variations of the same things.

A colleague and I even created a scale to rate HCM predictions based on whether they are new or just “old wine in new bottles.”  The reason HCM predictions do not change much over time is because the “H” in HCM is about people. People do not evolve as fast as technology. Consequently, the basic challenges of HCM are constant: getting the right people in the right roles and providing them with the right work environments while complying with employment laws.

The following are my “top ten” predictions about how these will change in 2018.

Workforce agility will become the most critical concept in HCM. It is often said that the only constant is change. It is now more accurate to say the only constant is an ever-accelerating rate of change. The only way companies can survive in the modern economy is to excel at adapting to changing markets, technologies, and business landscapes. This requires tapping into people’s innate capacity for learning, growth, and innovation.

Staffing will reach new levels of complexity. For over 100 years, most people interpreted “staffing” to mean hiring employees to work onsite in full-time or part-time roles.  This concept is changing due to shifting skill shortages, global labor pools, and a massive rise in virtual work and contract employment.  Staffing no longer means hiring employees.  It means finding the right mix of skills and matching them to business demands by tapping into an increasingly global, virtual, and contingent labor force. Companies will be forced to redefine workforce planning, recruiting, staffing, and management to work in this much more complex labor market.

The experience of work will greatly improve.  Technology has made a lot of things about our lives much easier and more enjoyable. Finding our way around a city, buying products, staying in touch with our friends, watching movies, and hundreds of other life experiences have been transformed by social and mobile technologies leveraging artificially intelligent interfaces and machine learning algorithms. We will see exponential growth in the use of artificial intelligence, chatbots, intelligent services, machine learning, mobile solutions, and social platforms to make work more enjoyable, simple, and engaging.

Performance management will become a solution, not a problem. People have hated performance management for decades.  This is changing thanks to companies rethinking performance management to focus on ongoing coaching and team based decision making.  We will soon reach a tipping point where the dreaded annual review will be nothing more than a painful memory, having been replaced by mobile technology enabled continuous performance management solutions that employees and managers both appreciate and like.

Re-conceptualizing compensation. Companies spend billions of dollars each year on merit increases, bonuses, and other form of compensation.  Yet few of them can confidently answer this question: “What is the return on investment you get from the money spent on compensation in terms of increased employee engagement, productivity, and retention?” Companies can tell down to the last penny how much is spent on compensation, but they cannot tell if that money is being spent wisely. The future of compensation will involve more continuous processes where employees receive different types of rewards throughout the year from different sources.  And analytics will be used to link investments in compensation to returns in workforce productivity.

Intolerance of inequity. For too long, companies have viewed inequity as a problem, but not a problem worth solving. With the workforce becoming increasingly diverse, particularly the rise of women who now represent 50 percent or more of the employees in many fields, society is reaching a long-awaited tipping point where inequitable treatment based on non-job relevant factors such as gender, ethnicity, and age is being openly acknowledged and addressed. Smart companies will proactively redesign their talent management practices to ensure bias is identified and addressed before it happens.

The rise of well-being tech. People are not meant to live in an “always on” 24-7 world.  The pace of work is literally burning people out.  Companies need employees to be highly engaged, creative, and service oriented.  But this is impossible to do if employees are tired, stressed, and distracted.  In the coming year, companies will continue to make more well-being tools available to their employees. With the explosion of well-being technology at the consumer level, such as smartwatches and fitness technology, many employers will be looking to bring these tools into the workplace.  However, successful organizations will be those who make such technologies accessible, enjoyable, and cultural for their employees.

Org charts will begin to phase out. There is a lot of talk about updating businesses for the digital age, and yet companies continue to manage work forces using a tool that has changed little since the Roman Empire: the hierarchical organization chart (“org chart”). Relying on org charts to guide workforce management decisions is both foolish and dangerous in a digitalized world. And while 2018 will not be “the year the org chart died,” some progressive organizations will begin to phase out traditional org charts for more modern, digital approaches.

Companies will ditch all-or-nothing retirement. 2018 will bring about a major shift in workplace dynamics with regards to older generations. Today, individuals are living longer, and thus working longer – past 60, 70, and even 80.  Forward-thinking organizations realize the need to keep this skilled talent in their organization, particularly as many industries face increasing skills shortages. However, this transition will also force companies to rethink jobs; for example, many positions that used to be full time will become part time.  In the coming year, organizations will begin to move away from the traditional, all-or-nothing view of retirement.

Growth in HR cybersecurity threats. Ransom ware made its main stage debut in 2017 with the WannaCry and NotPetya attacks.  In 2018, ransom ware threats will continue to proliferate.  HR systems have not historically been a major target of cyber criminals.  Unfortunately, this will change.  There will be a growing number of attacks against human resources departments, with cyber-criminals posing as potential applicants in the hopes of infecting the larger organization.

We should feel confident these trends will continue to evolve over the coming years. If there is one thing psychologists have proven over the years about predictions, it is that the best predictor of future behavior is past behavior.

For more on technology and HR, see Why (And How) Technology Is Bringing HR And The CFO Together.

This article originally appeared on Forbes SAPVoice.

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Steven Hunt

About Steven Hunt

Steven Hunt is the Senior Vice President of Customer Value at SAP. He is responsible for guiding the strategy and deployment of knowledge, tools and process improvements that increase the value customers receive from SuccessFactors & SAP Cloud software as a service solutions.