OTT And Streaming: A Far More Agile Approach To Media Distribution

Michael Brenner

Let’s run through the who, the what, the where, the why, the when, and the how of today’s media market.

The who, of course, represents the client or consumer. Perhaps this is someone you have targeted specifically based on their preferences and interests, or someone who accessed your content organically.

The what is the media product you are offering; a high-quality, well-researched piece of content that will resonate with your targeted audience.

The where must be wherever this client, consumer, or lead is found. We are operating in an omnichannel environment. Businesses must be flexible enough to support this.

The why can represent many different things, but must integrate with your long- and short-term objectives.

The when… well, the when is right now. It’s a fast-paced market, after all.

And, the all important how – how can we make this happen? By adopting an over-the-top (OTT) approach to media streaming.

The OTT streaming model

So what exactly is over-the-top streaming? OTT streaming simply refers to any method of delivering streamed content to a user over the internet while disrupting traditional structures of billing and distribution.

In essence, there are accepted means and methods of delivering content to users, but OTT model adopters simply go directly over the top. This leads to a far more straightforward business environment, but one that might not be welcomed by all figures in the industry, particularly those with a vested interest in preserving the old ways.

We can see this OTT approach in all aspects of modern digital life. Expats living abroad once had to pay serious money to call their friends and family back at home; now they simply sign into Skype or use Facetime. Music fans used to shell out $20 for a CD; now they have access to an ocean of music at their fingertips. Television viewers once had to wait for their favorite show in the schedule; now they just click a link in a menu and away they go.

Life has never been easier for media subscribers and fans of art and culture. For this, we must thank the innovative minds who shattered the status quo and moved the industry forwards.

With this in mind, what comes next? How can your business connect with these OTT advantages?

The key considerations

1. High-quality, reliable video streaming

First and foremost, the media product has to be top notch. This is the bait on the hook that will draw users into your offerings and encourage them to develop a closer relationship with your company.

To support this, you must have the capability to provide high-quality streaming services whenever and wherever they are required, across multiple channels and to multiple, simultaneous users. Increasing numbers of providers are investing in reliable cloud services to ensure that their offerings to users are seamlessly delivered

2. A focus on UX

The end user must always come first when adopting this model. Remember: the primary reason for the success of OTT is that UX is so dramatically enhanced. Customers find themselves paying less, experiencing more choice and greater convenience – all factors that contribute to an exemplary experience.

With this in mind, look to support this enhancement of the user experience at every turn. This includes investment in the research and development of your services, optimization of the user interface, and a commitment to incredible service through both automated and human channels.

3. Powerful content management system

Unless you are planning to deliver your content on an ad hoc basis, you are must be able to store and manage large volumes of media. Your channels can experience no disruption if your OTT offerings are to be successful. Always remember, convenience is king. Seek to make your systems and your content delivery architecture as airtight as possible.

A powerful content management system – or CMS – is not simply a desirable addition to your media marketing arsenal. It is a necessity. This will give you and your team a neat platform via which to upload, manage, deliver, and track content. Invest in a CMS that suits your objectives and integrates with your strategy.

4. Billing flexibility

Flexibility and agility are two of the primary concerns for any business looking to pursue an OTT content delivery model. It was the relative inflexibility of traditional delivery channels that led to the OTT revolution in the first place, so businesses adopting this route must be careful to avoid these same pitfalls of rigidity and unresponsiveness.

This means monetizing your content in any way that is appropriate. Perhaps you want to introduce a pay per stream/download pricing structure, or maybe you would prefer to offer subscriptions for a monthly charge. There are many paths to choose, but remember to continually appraise and re-assess what is working and what is not in order to stay on top of the market.

5. Integration with existing commercial channels

Your OTT media strategy should not exist in isolation. Instead, it should be a key component of the wider structure of your business. When you deliver content to a user, you have their attention. This means, you have the perfect platform for delivering advertisements – provided you don’t go overboard – or for cross-marketing with other products.

Putting this into practice

Ultimately, building an OTT solution from scratch is prohibitively difficult. Even crafting a solution using a combination of integrated content management systems, user experience design systems, and other digital components, which come together to form part of a wider whole, is not something most companies have the necessary time and resources to deal with.

Instead, businesses wanting to get themselves involved in this OTT model of content delivery are looking towards pre-existing platforms. These platforms offer customization and personalization, enabling businesses to make their OTT strategy their own, while also providing a solid structure from which to launch reliable, great quality content.

IBM/ SAP’s Dhara project provides just this sort of platform to businesses looking to tap into the OTT streaming movement. For more information on the project, view here.

Disclosure: While this post is sponsored by SAP, all thoughts presented here are my own.


About Michael Brenner

Michael Brenner is a globally-recognized keynote speaker, author of  The Content Formula and the CEO of Marketing Insider GroupHe has worked in leadership positions in sales and marketing for global brands like SAP and Nielsen, as well as for thriving startups. Today, Michael shares his passion on leadership and marketing strategies that deliver customer value and business impact. He is recognized by the Huffington Post as a Top Business Keynote Speaker and   a top  CMO influencer by Forbes.

Five Strategies Shaping The Future Of Retail

Paul Dearlove

In January, I attended the National Retail Federation conference in New York City. This opened my eyes to the enormous disruption technology is creating in retail. To survive this disruption, retailers must rethink their game plan. If they don’t, their competitors will.

Here are 5 strategies retailers must consider to future-proof their success:

1. Attract customers with in-store experiences

Did you know that Nike’s New York store now offers customers an in-store basketball court? As customers play, cameras analyze their footwork and generate shoe recommendations.

By investing in such innovative, engaging experiences, retailers can bring their offline experience into the age of Brick and Mortar 2.0.

2. Enhance assortment planning with AI

What if retailers could know exactly what their customers wanted? Marketing and inventory management would be minimized, allowing retailers to invest in an engaging shopping experience.

By adopting AI-driven Business Analytics, retailers can understand exactly what their customers want. This allows retailers to right-size their operations, which involves establishing small outlets that stock exactly what local shoppers are looking for. By offering smaller, smarter product inventories, retailers will reap higher ROI.

3. Coach customers through their decision journey

Winning customer loyalty is a game, and consumers are coming to the field with more knowledge than ever before. They can spend hours researching reviews and comparing prices before coming to a decision. To convert consumers into customers, retailers must meet them at every moment of their decision journey.

In a way, retailers must approach this like the coach of a sports team. They must manage their customer’s game plan, guiding them towards their goal with advice at critical moments in their decision journey. This involves learning what each customer responds to andoffering them the best assistance on dynamic channels. That could include smart messenger bots on social media or in-store AR assistants.

4. Give customers a greater connection to products

Most customers want to touch products before they buy. To cater to this, consider digital twin technology. This technology can put virtual copies of products into the hands of consumers, including virtual changing rooms and 360-degree product shots. By bringing online shoppers closer to products, you can make them feel more secure about purchasing online.

Customization can also bring customers closer to products. By connecting customers to the manufacturing process through drop shipping and 3D printing, retailers can get closer to offering customers their perfect product.

5. Simplify shopping at every stage

In today’s complicated world, consumers are starving for simplicity. To stand out from the noise, retailers should offer simpler access to their products and services. By optimizing supply chains, retailers can offer customers simple same-day delivery. Through conversational AI, retailers can allow customers to order products with one word. By embracing simplicity, retailers will grow sales.

It’s important to remember that this isn’t retail’s first cycle of change. As with every other cycle, the retailers that survive will be those that transform themselves before disruption forces them to change.

For more on digital disruption in the retail industry, see The New Retail Reality: Moving Beyond Sales.


About Paul Dearlove

Paul Dearlove is General Manager - Retail, SAP ANZ based in Sydney. As a former professional athlete, Paul has a keen focus on high performance and believes there are many skills that can be transferred to the corporate environment.

How Hagleitner Reinvented Its Business With Partnerships

Marina Simonians

In my last post, I wrote about the software revolution enabling digital transformation and how it is creating a world where data is king, software is queen, and partnerships are gold. In the next few posts, I’ll expand on these ideas and share several real-world examples that illustrate how partnerships enable companies in all segments and industries to reinvent their businesses and compete in a connected and data-driven world.

For almost 50 years, Hagleitner Hygiene International GmbH has prospered by manufacturing durable hygiene products for washrooms, kitchens, laundries, hospitality, and custodial work.

While the company’s business is strong, its competitors are fierce and exerting significant commoditization pressure. Rather than engaging in this race to the end, the company’s managers decided to go all-in on digital innovation and use data, software, and partnerships to introduce a new a line of smart hygiene devices and value-added services.

To enable this transformation, Hagleitner powered its digital transformation in just six months by partnering with fast cloud deployment to create senseMANAGEMENT, an IoT-based intelligent monitoring system. This system uses wireless sensors embedded in devices to communicate real-time data to a local edge database and sync it to a larger in-memory database service delivered in the cloud. The system delivers full analytics reporting to generate insights for predicting usage, optimizing maintenance, enabling just-in-time deliveries, and further leveraging data-driven decision-making. With access to these tools, applications, and components, Hagleitner, a traditional equipment manufacturer, is well positioned to use IoT and real-time monitoring services to drive ongoing innovation.

As this engagement reveals, digital transformation is about more than sensors, data, and software. Companies also need to find a partner that is able to help them achieve their goals and act on them. A partnership’s success can be measured by looking at these metrics and asking the question: Were we able to move forward and utilize the expected outcome from this partnership? In Hagleither’s case, the answer was affirmative. Not only can the company utilize the information gathered, but it can also use this data for planning, thereby helping future projects, partnerships, and, ultimately, revenue.

To learn more, get details on how Hagleitner innovated its business model, including its architecture diagram, by reading the full case study, “Using the Internet of Things and the Cloud to Disrupt the Hygiene Business.”


Marina Simonians

About Marina Simonians

Marina Simonians is the Head of Global ISV GTM Strategy at SAP responsible for building new global ISV software driven initiatives for Big Data, AI/ML, Advanced analytics and IoT. With a passion for ecosystems she believes partnerships are most critical success factor in today’s software-driven market.

Hack the CIO

By Thomas Saueressig, Timo Elliott, Sam Yen, and Bennett Voyles

For nerds, the weeks right before finals are a Cinderella moment. Suddenly they’re stars. Pocket protectors are fashionable; people find their jokes a whole lot funnier; Dungeons & Dragons sounds cool.

Many CIOs are enjoying this kind of moment now, as companies everywhere face the business equivalent of a final exam for a vital class they have managed to mostly avoid so far: digital transformation.

But as always, there is a limit to nerdy magic. No matter how helpful CIOs try to be, their classmates still won’t pass if they don’t learn the material. With IT increasingly central to every business—from the customer experience to the offering to the business model itself—we all need to start thinking like CIOs.

Pass the digital transformation exam, and you probably have a bright future ahead. A recent SAP-Oxford Economics study of 3,100 organizations in a variety of industries across 17 countries found that the companies that have taken the lead in digital transformation earn higher profits and revenues and have more competitive differentiation than their peers. They also expect 23% more revenue growth from their digital initiatives over the next two years—an estimate 2.5 to 4 times larger than the average company’s.

But the market is grading on a steep curve: this same SAP-Oxford study found that only 3% have completed some degree of digital transformation across their organization. Other surveys also suggest that most companies won’t be graduating anytime soon: in one recent survey of 450 heads of digital transformation for enterprises in the United States, United Kingdom, France, and Germany by technology company Couchbase, 90% agreed that most digital projects fail to meet expectations and deliver only incremental improvements. Worse: over half (54%) believe that organizations that don’t succeed with their transformation project will fail or be absorbed by a savvier competitor within four years.

Companies that are making the grade understand that unlike earlier technical advances, digital transformation doesn’t just support the business, it’s the future of the business. That’s why 60% of digital leading companies have entrusted the leadership of their transformation to their CIO, and that’s why experts say businesspeople must do more than have a vague understanding of the technology. They must also master a way of thinking and looking at business challenges that is unfamiliar to most people outside the IT department.

In other words, if you don’t think like a CIO yet, now is a very good time to learn.

However, given that you probably don’t have a spare 15 years to learn what your CIO knows, we asked the experts what makes CIO thinking distinctive. Here are the top eight mind hacks.

1. Think in Systems

A lot of businesspeople are used to seeing their organization as a series of loosely joined silos. But in the world of digital business, everything is part of a larger system.

CIOs have known for a long time that smart processes win. Whether they were installing enterprise resource planning systems or working with the business to imagine the customer’s journey, they always had to think in holistic ways that crossed traditional departmental, functional, and operational boundaries.

Unlike other business leaders, CIOs spend their careers looking across systems. Why did our supply chain go down? How can we support this new business initiative beyond a single department or function? Now supported by end-to-end process methodologies such as design thinking, good CIOs have developed a way of looking at the company that can lead to radical simplifications that can reduce cost and improve performance at the same time.

They are also used to thinking beyond temporal boundaries. “This idea that the power of technology doubles every two years means that as you’re planning ahead you can’t think in terms of a linear process, you have to think in terms of huge jumps,” says Jay Ferro, CIO of TransPerfect, a New York–based global translation firm.

No wonder the SAP-Oxford transformation study found that one of the values transformational leaders shared was a tendency to look beyond silos and view the digital transformation as a company-wide initiative.

This will come in handy because in digital transformation, not only do business processes evolve but the company’s entire value proposition changes, says Jeanne Ross, principal research scientist at the Center for Information Systems Research at the Massachusetts Institute of Technology (MIT). “It either already has or it’s going to, because digital technologies make things possible that weren’t possible before,” she explains.

2. Work in Diverse Teams

When it comes to large projects, CIOs have always needed input from a diverse collection of businesspeople to be successful. The best have developed ways to convince and cajole reluctant participants to come to the table. They seek out technology enthusiasts in the business and those who are respected by their peers to help build passion and commitment among the halfhearted.

Digital transformation amps up the urgency for building diverse teams even further. “A small, focused group simply won’t have the same breadth of perspective as a team that includes a salesperson and a service person and a development person, as well as an IT person,” says Ross.

At Lenovo, the global technology giant, many of these cross-functional teams become so used to working together that it’s hard to tell where each member originally belonged: “You can’t tell who is business or IT; you can’t tell who is product, IT, or design,” says the company’s CIO, Arthur Hu.

One interesting corollary of this trend toward broader teamwork is that talent is a priority among digital leaders: they spend more on training their employees and partners than ordinary companies, as well as on hiring the people they need, according to the SAP-Oxford Economics survey. They’re also already being rewarded for their faith in their teams: 71% of leaders say that their successful digital transformation has made it easier for them to attract and retain talent, and 64% say that their employees are now more engaged than they were before the transformation.

3. Become a Consultant

Good CIOs have long needed to be internal consultants to the business. Ever since technology moved out of the glasshouse and onto employees’ desks, CIOs have not only needed a deep understanding of the goals of a given project but also to make sure that the project didn’t stray from those goals, even after the businesspeople who had ordered the project went back to their day jobs. “Businesspeople didn’t really need to get into the details of what IT was really doing,” recalls Ferro. “They just had a set of demands and said, ‘Hey, IT, go do that.’”

Now software has become so integral to the business that nobody can afford to walk away. Businesspeople must join the ranks of the IT consultants.

But that was then. Now software has become so integral to the business that nobody can afford to walk away. Businesspeople must join the ranks of the IT consultants. “If you’re building a house, you don’t just disappear for six months and come back and go, ‘Oh, it looks pretty good,’” says Ferro. “You’re on that work site constantly and all of a sudden you’re looking at something, going, ‘Well, that looked really good on the blueprint, not sure it makes sense in reality. Let’s move that over six feet.’ Or, ‘I don’t know if I like that anymore.’ It’s really not much different in application development or for IT or technical projects, where on paper it looked really good and three weeks in, in that second sprint, you’re going, ‘Oh, now that I look at it, that’s really stupid.’”

4. Learn Horizontal Leadership

CIOs have always needed the ability to educate and influence other leaders that they don’t directly control. For major IT projects to be successful, they need other leaders to contribute budget, time, and resources from multiple areas of the business.

It’s a kind of horizontal leadership that will become critical for businesspeople to acquire in digital transformation. “The leadership role becomes one much more of coaching others across the organization—encouraging people to be creative, making sure everybody knows how to use data well,” Ross says.

In this team-based environment, having all the answers becomes less important. “It used to be that the best business executives and leaders had the best answers. Today that is no longer the case,” observes Gary Cokins, a technology consultant who focuses on analytics-based performance management. “Increasingly, it’s the executives and leaders who ask the best questions. There is too much volatility and uncertainty for them to rely on their intuition or past experiences.”

Many experts expect this trend to continue as the confluence of automation and data keeps chipping away at the organizational pyramid. “Hierarchical, command-and-control leadership will become obsolete,” says Edward Hess, professor of business administration and Batten executive-in-residence at the Darden School of Business at the University of Virginia. “Flatter, distributive leadership via teams will become the dominant structure.”

5. Understand Process Design

When business processes were simpler, IT could analyze the process and improve it without input from the business. But today many processes are triggered on the fly by the customer, making a seamless customer experience more difficult to build without the benefit of a larger, multifunctional team. In a highly digitalized organization like Amazon, which releases thousands of new software programs each year, IT can no longer do it all.

While businesspeople aren’t expected to start coding, their involvement in process design is crucial. One of the techniques that many organizations have adopted to help IT and businesspeople visualize business processes together is design thinking (for more on design thinking techniques, see “A Cult of Creation“).

Customers aren’t the only ones who benefit from better processes. Among the 100 companies the SAP-Oxford Economics researchers have identified as digital leaders, two-thirds say that they are making their employees’ lives easier by eliminating process roadblocks that interfere with their ability to do their jobs. Ninety percent of leaders surveyed expect to see value from these projects in the next two years alone.

6. Learn to Keep Learning

The ability to learn and keep learning has been a part of IT from the start. Since the first mainframes in the 1950s, technologists have understood that they need to keep reinventing themselves and their skills to adapt to the changes around them.

Now that’s starting to become part of other job descriptions too. Many companies are investing in teaching their employees new digital skills. One South American auto products company, for example, has created a custom-education institute that trained 20,000 employees and partner-employees in 2016. In addition to training current staff, many leading digital companies are also hiring new employees and creating new roles, such as a chief robotics officer, to support their digital transformation efforts.

Nicolas van Zeebroeck, professor of information systems and digital business innovation at the Solvay Brussels School of Economics and Management at the Free University of Brussels, says that he expects the ability to learn quickly will remain crucial. “If I had to think of one critical skill,” he explains, “I would have to say it’s the ability to learn and keep learning—the ability to challenge the status quo and question what you take for granted.”

7. Fail Smarter

Traditionally, CIOs tended to be good at thinking through tests that would allow the company to experiment with new technology without risking the entire network.

This is another unfamiliar skill that smart managers are trying to pick up. “There’s a lot of trial and error in the best companies right now,” notes MIT’s Ross. But there’s a catch, she adds. “Most companies aren’t designed for trial and error—they’re trying to avoid an error,” she says.

To learn how to do it better, take your lead from IT, where many people have already learned to work in small, innovative teams that use agile development principles, advises Ross.

For example, business managers must learn how to think in terms of a minimum viable product: build a simple version of what you have in mind, test it, and if it works start building. You don’t build the whole thing at once anymore.… It’s really important to build things incrementally,” Ross says.

Flexibility and the ability to capitalize on accidental discoveries during experimentation are more important than having a concrete project plan, says Ross. At Spotify, the music service, and CarMax, the used-car retailer, change is driven not from the center but from small teams that have developed something new. “The thing you have to get comfortable with is not having the formalized plan that we would have traditionally relied on, because as soon as you insist on that, you limit your ability to keep learning,” Ross warns.

8. Understand the True Cost—and Speed—of Data

Gut instincts have never had much to do with being a CIO; now they should have less to do with being an ordinary manager as well, as data becomes more important.

As part of that calculation, businesspeople must have the ability to analyze the value of the data that they seek. “You’ll need to apply a pinch of knowledge salt to your data,” advises Solvay’s van Zeebroeck. “What really matters is the ability not just to tap into data but to see what is behind the data. Is it a fair representation? Is it impartial?”

Increasingly, businesspeople will need to do their analysis in real time, just as CIOs have always had to manage live systems and processes. Moving toward real-time reports and away from paper-based decisions increases accuracy and effectiveness—and leaves less time for long meetings and PowerPoint presentations (let us all rejoice).

Not Every CIO Is Ready

Of course, not all CIOs are ready for these changes. Just as high school has a lot of false positives—genius nerds who turn out to be merely nearsighted—so there are many CIOs who aren’t good role models for transformation.

Success as a CIO these days requires more than delivering near-perfect uptime, says Lenovo’s Hu. You need to be able to understand the business as well. Some CIOs simply don’t have all the business skills that are needed to succeed in the transformation. Others lack the internal clout: a 2016 KPMG study found that only 34% of CIOs report directly to the CEO.

This lack of a strategic perspective is holding back digital transformation at many organizations. They approach digital transformation as a cool, one-off project: we’re going to put this new mobile app in place and we’re done. But that’s not a systematic approach; it’s an island of innovation that doesn’t join up with the other islands of innovation. In the longer term, this kind of development creates more problems than it fixes.

Such organizations are not building in the capacity for change; they’re trying to get away with just doing it once rather than thinking about how they’re going to use digitalization as a means to constantly experiment and become a better company over the long term.

As a result, in some companies, the most interesting tech developments are happening despite IT, not because of it. “There’s an alarming digital divide within many companies. Marketers are developing nimble software to give customers an engaging, personalized experience, while IT departments remain focused on the legacy infrastructure. The front and back ends aren’t working together, resulting in appealing web sites and apps that don’t quite deliver,” writes George Colony, founder, chairman, and CEO of Forrester Research, in the MIT Sloan Management Review.

Thanks to cloud computing and easier development tools, many departments are developing on their own, without IT’s support. These days, anybody with a credit card can do it.

Traditionally, IT departments looked askance at these kinds of do-it-yourself shadow IT programs, but that’s changing. Ferro, for one, says that it’s better to look at those teams not as rogue groups but as people who are trying to help. “It’s less about ‘Hey, something’s escaped,’ and more about ‘No, we just actually grew our capacity and grew our ability to innovate,’” he explains.

“I don’t like the term ‘shadow IT,’” agrees Lenovo’s Hu. “I think it’s an artifact of a very traditional CIO team. If you think of it as shadow IT, you’re out of step with reality,” he says.

The reality today is that a company needs both a strong IT department and strong digital capacities outside its IT department. If the relationship is good, the CIO and IT become valuable allies in helping businesspeople add digital capabilities without disrupting or duplicating existing IT infrastructure.

If a company already has strong digital capacities, it should be able to move forward quickly, according to Ross. But many companies are still playing catch-up and aren’t even ready to begin transforming, as the SAP-Oxford Economics survey shows.

For enterprises where business and IT are unable to get their collective act together, Ross predicts that the next few years will be rough. “I think these companies ought to panic,” she says. D!


About the Authors

Thomas Saueressig is Chief Information Officer at SAP.

Timo Elliott is an Innovation Evangelist at SAP.

Sam Yen is Chief Design Officer at SAP and Managing Director of SAP Labs.

Bennett Voyles is a Berlin-based business writer.

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

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Survey: Four Ways Machine Learning Will Disrupt Your Business

Dan Wellers and Dirk Jendroska

We are entering the era of the machine learning enterprise, in which this subset of artificial intelligence (AI) capabilities will revolutionize operating models, shake up staffing methods, upend business models, and potentially alter the nature of competition itself. The adoption of machine learning capabilities will be limited only by an organization’s ability to change – but not every company will be willing or able to make such a radical shift.

Very soon, the difference between the haves and the have-nots of machine learning will become clear. “The disruption over the next three to five years will be massive,” says Cliff Justice, principal in KPMG’s Innovation and Enterprise Solutions team. Companies hanging onto their legacy processes will struggle to compete with machine learning enterprises able to compete with a fraction of the resources and entirely new value propositions.

For those seeking to be on the right side of the disruption, a new survey, conducted by SAP and the Economist Intelligence Unit (EIU), offers a closer look at organizations we’ve identified as the Fast Learners of machine learning: those that are already seeing benefits from their implementations.

Machine learning is unlike traditional programmed software. Machine learning software actually gets better – autonomously and continuously – at executing tasks and business processes. This creates opportunities for deeper insight, non-linear growth, and levels of innovation previously unseen.

Given that, it’s not surprising that machine learning has evolved from hype to have-to-have for the enterprise in seemingly record time. According to the SAP/EIU survey, more than two-thirds of respondents (68%) are already experimenting with it. What’s more, many of these organizations are seeing significantly improved performance across the breadth of their operations as a result, and some are aiming to remake their businesses on the back of these singular, new capabilities.

So, what makes machine learning so disruptive? Based on our analysis of the survey data and our own research, we see four primary reasons:

1. It’s probabilistic, not programmed

Machine learning uses sophisticated algorithms to enable computers to “learn” from large amounts of data and take action based on data analysis rather than being explicitly programmed to do something. Put simply, the machine can learn from experience; coded software does not. “It operates more like a human does in terms of how it formulates its conclusions,” says Justice.

That means that machine learning will provide more than just a one-time improvement in process and productivity; those improvements will continue over time, remaking business processes and potentially creating new business models along the way.

2. It creates exponential efficiency

When companies integrate machine learning into business processes, they not only increase efficiency, they are able to scale up without a corresponding increase in overhead. If you get 5,000 loan applications one month and 20,000 the next month, it’s not a problem, says Sudir Jha, head of product management and strategy for Infosys; the machines can handle it.

3. It frees up capital – financial and human

Because machine learning can be used to automate any repetitive task, it enables companies to redeploy resources to areas that make the organization more competitive, says Justice. It also frees up the employees within an organization to perform higher-value, more rewarding work. That leads to reduced turnover and higher employee satisfaction. And studies show that happier employees lead to higher customer satisfaction and better business results.

4. It creates new opportunities

AI and machine learning can offer richer insight, deeper knowledge, and predictions that would not be possible otherwise. Machine learning can enable not only new processes, but entirely new business models or value propositions for customers – “opportunities that would not be possible with just human intelligence,” says Justice. “AI impacts the business model in a much more disruptive way than cloud or any other disruption we’ve seen in our lifetimes.”

Machine learning systems alone, however, will not transform the enterprise. The singular opportunities enabled by these capabilities will only occur for companies that dedicate themselves to making machine learning part of a larger digital transformation strategy. The results of the SAP/EIU survey explain the makeup of the evolving machine learning enterprise. We’ve identified key traits important to the success of these machine-learning leaders that can serve as a template for others as well as an overview of the outcomes they’re already seeing from their efforts.

Learn more and download the full study here.  

 


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.

Dirk Jendroska

About Dirk Jendroska

Dr. Dirk Jendroska is Head of Strategy and Operations Machine Learning at SAP. He supports the vision of SAP Leonardo Machine Learning to enable the intelligent enterprise by making enterprise applications intelligent. He leads a team working on machine learning strategy, marketing and communications.