IT Managers Embrace the Consumerization of IT

Bill Gerneglia

CIOs and smart business leader are quickly learning to embrace BYOD and the consumerization of IT trend in their organizations as they seek new opportunities for innovation.

As many of the most popular applications used today have moved onto ubiquitous consumer devices such as smart phones and tablets, the world of enterprise computing is changing as are the challenges faced by both CIOs and their IT departments to manage these changes.

The latest enterprise mobility trends including IT consumerization, workforce mobility and flexible computing brought on by BYOD are altering the traditional relationship between enterprise IT departments, knowledge workers, and end users.

For CIOs, IT consumerization presents a difficult set of challenges including security, technology policy, data protection, and the acceptance of end-user BYOD technology. The alignment of these challenges with an organizations’ overall business strategy can lead to innovation in areas such as testing new business models, streamlining talent acquisition and management strategies, and building corporate brand and identity.

CIOs striving for innovation in their markets simply cannot afford to restrict internal BYOD technology usage. Doing so will only hinder the innovation they seek to deliver.
So the companies that can successfully change the traditional relationship between IT and end users will be better positioned to attract and retain key talent, execute new business models and improve overall competitiveness.

The BYOD Evolution

The BYOD evolution is clearly upon us as the technology focus is shifting towards providing end users with collaboration tools and applications which enable the leveraging of analytics data, marketing tools, HR management solutions, as well as sales and customer relationship management software.

This evolution is partly about how companies are deploying newer and more sophisticated technologies throughout the organization, but it is also about how the people are empowered by their devices and the apps they are acquiring and using in newer and more sophisticated ways.

The proliferation of mobile devices has caused the growing demand on organizations to secure the applications that run on them. Some CIOs struggle to provide a secure infrastructure to manage the growth of the consumerization of IT within their organization. This trend has been driven largely by the ubiquitous use of the Internet, mobile devices, and collaborative applications, and emerging broadband technologies.

Collaborative applications adopted by an organization provide unified communications clients that can deliver a consistent software-based user experience. These applications provide enterprise wide mobility and collaboration so that employees can work from anywhere, using virtually any device―including desktop and laptop computers, Android smartphones, Apple iPhones, Blackberrys, and Windows devices.

Increasingly, enterprise mobility tools enable employees to connect to the right person, at the right time, in the right mode. These anywhere-anytime collaboration tools help enterprises lower expenses, increase productivity, enhance business continuity, and streamline their customer support operations.

How large is the Consumerization of IT trend? According to the U.S. Census Bureau by April 1, 2012, the population of the world will stand at 7 billion. According to research from the market research site mobiThinking, as of January 2012 the number of cellular subscriptions worldwide was approximately 6 billion and the number of cellular mobile broadband subscriptions worldwide was approximately 1.2 billion.

Opportunities Arise from Consumerization

Organizations see great opportunities in moving from consumer to enterprise sales if they can embrace the needs of the consumer on their personal devices while facilitating their work responsibilities. Prudent CIOs look to embrace collaborative application solutions especially if one exists that fits their existing IT infrastructure road map. Additionally, some CIOs see opportunities in leveraging consumer applications from their employees and bring them into the businesses fold.

CIOs are starting to embrace these applications and services for the enterprise as they recognize the whole consumerization of IT has deep, profound implications. It is much more than bringing your own device to work. It is bringing your device to work and using it as a tool to become more productive at your job so you can leverage your knowledge to beat your competitors by becoming faster, cheaper, and better all while offering more quality and value.

The role of the CIO is to empower and lead the employees to use their consumer devices, but in a safe manner by minimizing the risk introduced by potential security problems. In a world where some of the more innovative technologies are evolving at the consumer level before trickling up to the enterprise, it comes as no surprise that even entry-level employees have access to powerful tools, and collaborative applications and networks in their personal lives. Smart IT managers will embrace them when they walk through the door or more likely access the corporate network.



About Bill Gerneglia

Bill has been a member of the technology and publishing industries for more than 25 years and brings extensive expertise to the roles of CEO, CIO, and Executive Editor. Most recently, Bill was COO and Co-Founder of and the parent company PSN Inc. Previously, Bill held the position of CTO of both Wiseads New Media and He worked for more than ten years as a systems & database C/C++ programmer at various technology and publishing companies before joining Oracle in their Architectural Services Division. He then became the VP of Systems & Quality for Elsevier Engineering Information where he helped build the Engineering Information Village. This product provides Web based full text search access to the Compendex database. This database is still used today by thousands of scientific and research organizations around the world. Bill studied Electrical Engineering at Manhattan College and Graduate Studies in Industrial Management at SUNY Stonybrook.

How Real-Time Consumer Intent Is Changing The Sales Cycle

Ralf Kern

As a marketer, it’s your job to know what a consumer bought, thought, and did a month ago, a week ago, and even yesterday. But do you know what a consumer is thinking right now?

Understanding real-time consumer intent allows marketers to deliver targeted information, like special product promos or offers, at the exact moment in time when a consumer is searching for this information. Real-time intent is a powerful marketing tool that helps businesses close more deals by providing the information consumers need at the exact moment they’re open to receiving this information. This drives decision-maker consensus, reduces barriers to sales, and primes consumer to take immediate action.

The contemporary sales cycle: More options, more stakeholders, more challenges

Motivating a customer to complete a purchase has always been a challenge for sales and marketing professionals at both B2B (business-to-business) and B2C (business-to-consumer) companies. At B2B companies, for example, shrinking budgets and a greater wealth of available options has led to longer sales cycles. More decision-makers means everyone needs to weigh in on a potential decision. This makes it more difficult to drive stakeholder consensus and also lengthens the decision-making process. Everyone wants to have a voice in the decision, but no one wants to be the deciding voice and risk getting blamed if the decision is a mistake.

The B2C decision-making cycle is also changing, thanks to social media and smartphone technology. Mobile shopping is disrupting the consumer decision journey for retail. Google reports that while foot traffic in retail stores has declined by 57% in the past five years, the value of every visit has nearly tripled. With smartphones in tow, consumers are researching product information, checking social media for product reviews, and doing a quick price comparison search before they make a purchase. Most significantly, these mobile searches are happening at the exact moment consumers are in stores. They’re holding the product in their hands, asking, “Should I buy this right now?”

How does intent targeting increase sales?

Intent targeting allows businesses to reach consumers at these critical, decision-making moments. Whether it’s delivering a case study that drives decision-maker consensus at a B2B company or targeting consumers with a special promo discount while they’re doing a mobile price comparison, intent targeting delivers the right information at the right moment.

Intent targeting is different than showing an ad on a website that simply mirrors that website’s content. When businesses truly understand real-time customer intent, they can target a customer with information aligned with the consumer’s needs across a variety of touch points. Most importantly, the timing is spot-on: marketers can target a customer at the exact moment that customer is open to receiving information.

Targeting consumers in the moment with dynamic, contextually relevant experiences

Successful customer engagement must be proactive, tapping into the emotional drivers behind the buying process and delivering relevant customer experiences in real time. The more compelling and relevant the experience, the more likely customers will stay engaged (or re-engage) during the buying journey.

In order to successfully engage with today’s customers, businesses need more than just historical data. They need knowledge of “in-the-moment” customer activity to accurately target and deliver relevant and engaging customer offers and promotions. They need to understand the real-time intent of each customer and dynamically deliver contextually relevant experiences across channels. This requires a 360-degree view of customer’s behavior and actions. Businesses need to be able to process large volumes of structured and unstructured data, score implicit and explicit behavior across channels, and convert this information into real-time insights that drive marketing decisions.

Static customer segmentation approaches don’t cut it anymore. Progressive customer profiling taking into account each and every customer interaction and sentiment are required to show empathy, build trust, and earn customer loyalty. Customer happiness is the ultimate currency in retail. A concise and contextual brand experience based on a deep understanding of the customer is a prerequisite to creating customers for life.

Learn how to innovate at scale by incorporating individual innovations back to the core business to drive tangible business value: Accelerating Digital Transformation in Retail. Explore how to bring Industry 4.0 insights into your business today: Industry 4.0: What’s Next?


Ralf Kern

About Ralf Kern

Ralf Kern is the Global Vice President, Business Unit Retail, at SAP, responsible for the future direction of SAP’s solution and global Go-to-Market strategy for Omnicommerce Retail, leading them into today’s digital reality.

Leverage The Internet Of Things To Deliver New Customer Experiences

Joerg Koesters

Digitization is changing our world and our customer’s experience expectations. It’s expected that by 2020, IoT devices will increase from 6.4 billion to more than 50 billion. This pervasiveness of technology means many more data points are available from every customer or prospect. It’s expected that as these available data points grow, so will customer expectations.

Disruption is also having a strong effect as new business models are being developed and implemented. Instead of video rental stores, we now have kiosks at every major store and streaming video. Why? In addition to convenience, people didn’t like the excessive late fees. The world’s largest taxi service owns no vehicles, because people were tired of high rates. In response, someone developed a site to facilitate private ridesharing. Big-box stores have been closing in record numbers. Why? Because the convenience of shopping online with better customer service won the hearts of shoppers around the world.

Today’s customers are also more educated about the products they’re purchasing well before they speak to a sales representative. It’s estimated that 90% of research that happens prior to purchase happens online. Combined with limited stock in stores compared to online, this often means the sales representative has become a facilitator of the purchase process. This transformation is part of a larger overall change in customer expectations. Part of the shift that disruption is bringing to our society is creating a customer-centric focus. Out of all retail CEOs, 77% are concerned about this change. This is much higher when compared to CEOs in other industries. But how do you deliver a superior customer experience?

Under pressure to deliver new customer experiences? Leverage the Internet of Things

Today’s consumer expects the right deal at the right time in the right place. They expect an exceptional customer experience. Responding to that level of expectation is difficult at best. Today’s businesses are under pressure to deliver on that expectation. But how do you reach that end goal? There are a number of ways you can get there, but a combination of these approaches will yield the best results. Here’s a quick look at some of the major facets of creating an exceptional customer experience.

One aspect of this expectation is personalization. The modern consumer wants to see offers that are focused on their interests. This requires in-depth data and analytics to find customer buying patterns. Using Facebook ads or Google Analytics to track the consumer’s interests gives you the data you need to, being able to process the data you receive can mean all the difference between having a successful customer experience and one that leaves your customers wanting more.

Innovation management is another area that will help your company gain ground with your customers. Connectivity allows consumers to look at products from a wider range of companies. This means that the time you have from product or service development to introduction to the market has sped up significantly. This adds a great deal of pressure to your team. Having solid innovation management in place is vital to your company’s overall vitality. As customer expectations increase, you’ll need to deliver new products and innovations on a faster timetable than in the past.

With the pervasive use of mobile technology, having a solid, seamless experience is vital to your company’s well being. From your mobile app to your website to your brick and mortar locations, every interaction your company has with a prospective customer provides an opportunity to create an exceptional experience. Having a solid digital core makes it much easier to create a uniform experience. However, just as important is getting the system set up properly to work with not only today’s technology and expectations but tomorrow’s as well.

What level of integration does your company have with IoT technology? The fast increase in the number of integrated objects will provide companies with a much wider range of opportunities to interact and gather information from your prospects. It’s expected that over the next ten years, companies that work directly with their customers will capture 90% of the industry’s growth. This will cut out many companies that have served as middlemen in the past. These companies will then need to reinvent themselves or get out of the market. How will your company respond to these many challenges over the upcoming years?

As the customer experience continues to evolve, delivering an experience quickly while dealing with the pressure of time and competition is essential to retaining loyal customers. It will require working smarter rather than harder, automating much of your current workflow. Part of the process will also require adapting your current process of moving customers through their purchase to the new digitized reality.

Learn how to innovate at scale by incorporating individual innovations back to the core business to drive tangible business value: Accelerating Digital Transformation in Retail. Explore how to bring Industry 4.0 insights into your business today: Industry 4.0: What’s Next?


About Joerg Koesters

Joerg Koesters is the Head of Retail Marketing and Communication at SAP. He is a Technology Marketing executive with 20 years of experience in Marketing, Sales and Consulting, Joerg has deep knowledge in retail and consumer products having worked both in the industry and in the technology sector.

The Blockchain Solution

By Gil Perez, Tom Raftery, Hans Thalbauer, Dan Wellers, and Fawn Fitter

In 2013, several UK supermarket chains discovered that products they were selling as beef were actually made at least partly—and in some cases, entirely—from horsemeat. The resulting uproar led to a series of product recalls, prompted stricter food testing, and spurred the European food industry to take a closer look at how unlabeled or mislabeled ingredients were finding their way into the food chain.

By 2020, a scandal like this will be eminently preventable.

The separation between bovine and equine will become immutable with Internet of Things (IoT) sensors, which will track the provenance and identity of every animal from stall to store, adding the data to a blockchain that anyone can check but no one can alter.

Food processing companies will be able to use that blockchain to confirm and label the contents of their products accordingly—down to the specific farms and animals represented in every individual package. That level of detail may be too much information for shoppers, but they will at least be able to trust that their meatballs come from the appropriate species.

The Spine of Digitalization

Keeping food safer and more traceable is just the beginning, however. Improvements in the supply chain, which have been incremental for decades despite billions of dollars of technology investments, are about to go exponential. Emerging technologies are converging to transform the supply chain from tactical to strategic, from an easily replicable commodity to a new source of competitive differentiation.

You may already be thinking about how to take advantage of blockchain technology, which makes data and transactions immutable, transparent, and verifiable (see “What Is Blockchain and How Does It Work?”). That will be a powerful tool to boost supply chain speed and efficiency—always a worthy goal, but hardly a disruptive one.

However, if you think of blockchain as the spine of digitalization and technologies such as AI, the IoT, 3D printing, autonomous vehicles, and drones as the limbs, you have a powerful supply chain body that can leapfrog ahead of its competition.

What Is Blockchain and How Does It Work?

Here’s why blockchain technology is critical to transforming the supply chain.

Blockchain is essentially a sequential, distributed ledger of transactions that is constantly updated on a global network of computers. The ownership and history of a transaction is embedded in the blockchain at the transaction’s earliest stages and verified at every subsequent stage.

A blockchain network uses vast amounts of computing power to encrypt the ledger as it’s being written. This makes it possible for every computer in the network to verify the transactions safely and transparently. The more organizations that participate in the ledger, the more complex and secure the encryption becomes, making it increasingly tamperproof.

Why does blockchain matter for the supply chain?

  • It enables the safe exchange of value without a central verifying partner, which makes transactions faster and less expensive.
  • It dramatically simplifies recordkeeping by establishing a single, authoritative view of the truth across all parties.
  • It builds a secure, immutable history and chain of custody as different parties handle the items being shipped, and it updates the relevant documentation.
  • By doing these things, blockchain allows companies to create smart contracts based on programmable business logic, which can execute themselves autonomously and thereby save time and money by reducing friction and intermediaries.

Hints of the Future

In the mid-1990s, when the World Wide Web was in its infancy, we had no idea that the internet would become so large and pervasive, nor that we’d find a way to carry it all in our pockets on small slabs of glass.

But we could tell that it had vast potential.

Today, with the combination of emerging technologies that promise to turbocharge digital transformation, we’re just beginning to see how we might turn the supply chain into a source of competitive advantage (see “What’s the Magic Combination?”).

What’s the Magic Combination?

Those who focus on blockchain in isolation will miss out on a much bigger supply chain opportunity.

Many experts believe emerging technologies will work with blockchain to digitalize the supply chain and create new business models:

  • Blockchain will provide the foundation of automated trust for all parties in the supply chain.
  • The IoT will link objects—from tiny devices to large machines—and generate data about status, locations, and transactions that will be recorded on the blockchain.
  • 3D printing will extend the supply chain to the customer’s doorstep with hyperlocal manufacturing of parts and products with IoT sensors built into the items and/or their packaging. Every manufactured object will be smart, connected, and able to communicate so that it can be tracked and traced as needed.
  • Big Data management tools will process all the information streaming in around the clock from IoT sensors.
  • AI and machine learning will analyze this enormous amount of data to reveal patterns and enable true predictability in every area of the supply chain.

Combining these technologies with powerful analytics tools to predict trends will make lack of visibility into the supply chain a thing of the past. Organizations will be able to examine a single machine across its entire lifecycle and identify areas where they can improve performance and increase return on investment. They’ll be able to follow and monitor every component of a product, from design through delivery and service. They’ll be able to trigger and track automated actions between and among partners and customers to provide customized transactions in real time based on real data.

After decades of talk about markets of one, companies will finally have the power to create them—at scale and profitably.

Amazon, for example, is becoming as much a logistics company as a retailer. Its ordering and delivery systems are so streamlined that its customers can launch and complete a same-day transaction with a push of a single IP-enabled button or a word to its ever-attentive AI device, Alexa. And this level of experimentation and innovation is bubbling up across industries.

Consider manufacturing, where the IoT is transforming automation inside already highly automated factories. Machine-to-machine communication is enabling robots to set up, provision, and unload equipment quickly and accurately with minimal human intervention. Meanwhile, sensors across the factory floor are already capable of gathering such information as how often each machine needs maintenance or how much raw material to order given current production trends.

Once they harvest enough data, businesses will be able to feed it through machine learning algorithms to identify trends that forecast future outcomes. At that point, the supply chain will start to become both automated and predictive. We’ll begin to see business models that include proactively scheduling maintenance, replacing parts just before they’re likely to break, and automatically ordering materials and initiating customer shipments.

Italian train operator Trenitalia, for example, has put IoT sensors on its locomotives and passenger cars and is using analytics and in-memory computing to gauge the health of its trains in real time, according to an article in Computer Weekly. “It is now possible to affordably collect huge amounts of data from hundreds of sensors in a single train, analyse that data in real time and detect problems before they actually happen,” Trenitalia’s CIO Danilo Gismondi told Computer Weekly.

Blockchain allows all the critical steps of the supply chain to go electronic and become irrefutably verifiable by all the critical parties within minutes: the seller and buyer, banks, logistics carriers, and import and export officials.

The project, which is scheduled to be completed in 2018, will change Trenitalia’s business model, allowing it to schedule more trips and make each one more profitable. The railway company will be able to better plan parts inventories and determine which lines are consistently performing poorly and need upgrades. The new system will save €100 million a year, according to ARC Advisory Group.

New business models continue to evolve as 3D printers become more sophisticated and affordable, making it possible to move the end of the supply chain closer to the customer. Companies can design parts and products in materials ranging from carbon fiber to chocolate and then print those items in their warehouse, at a conveniently located third-party vendor, or even on the client’s premises.

In addition to minimizing their shipping expenses and reducing fulfillment time, companies will be able to offer more personalized or customized items affordably in small quantities. For example, clothing retailer Ministry of Supply recently installed a 3D printer at its Boston store that enables it to make an article of clothing to a customer’s specifications in under 90 minutes, according to an article in Forbes.

This kind of highly distributed manufacturing has potential across many industries. It could even create a market for secure manufacturing for highly regulated sectors, allowing a manufacturer to transmit encrypted templates to printers in tightly protected locations, for example.

Meanwhile, organizations are investigating ways of using blockchain technology to authenticate, track and trace, automate, and otherwise manage transactions and interactions, both internally and within their vendor and customer networks. The ability to collect data, record it on the blockchain for immediate verification, and make that trustworthy data available for any application delivers indisputable value in any business context. The supply chain will be no exception.

Blockchain Is the Change Driver

The supply chain is configured as we know it today because it’s impossible to create a contract that accounts for every possible contingency. Consider cross-border financial transfers, which are so complex and must meet so many regulations that they require a tremendous number of intermediaries to plug the gaps: lawyers, accountants, customer service reps, warehouse operators, bankers, and more. By reducing that complexity, blockchain technology makes intermediaries less necessary—a transformation that is revolutionary even when measured only in cost savings.

“If you’re selling 100 items a minute, 24 hours a day, reducing the cost of the supply chain by just $1 per item saves you more than $52.5 million a year,” notes Dirk Lonser, SAP go-to-market leader at DXC Technology, an IT services company. “By replacing manual processes and multiple peer-to-peer connections through fax or e-mail with a single medium where everyone can exchange verified information instantaneously, blockchain will boost profit margins exponentially without raising prices or even increasing individual productivity.”

But the potential for blockchain extends far beyond cost cutting and streamlining, says Irfan Khan, CEO of supply chain management consulting and systems integration firm Bristlecone, a Mahindra Group company. It will give companies ways to differentiate.

“Blockchain will let enterprises more accurately trace faulty parts or products from end users back to factories for recalls,” Khan says. “It will streamline supplier onboarding, contracting, and management by creating an integrated platform that the company’s entire network can access in real time. It will give vendors secure, transparent visibility into inventory 24×7. And at a time when counterfeiting is a real concern in multiple industries, it will make it easy for both retailers and customers to check product authenticity.”

Blockchain allows all the critical steps of the supply chain to go electronic and become irrefutably verifiable by all the critical parties within minutes: the seller and buyer, banks, logistics carriers, and import and export officials. Although the key parts of the process remain the same as in today’s analog supply chain, performing them electronically with blockchain technology shortens each stage from hours or days to seconds while eliminating reams of wasteful paperwork. With goods moving that quickly, companies have ample room for designing new business models around manufacturing, service, and delivery.

Challenges on the Path to Adoption

For all this to work, however, the data on the blockchain must be correct from the beginning. The pills, produce, or parts on the delivery truck need to be the same as the items listed on the manifest at the loading dock. Every use case assumes that the data is accurate—and that will only happen when everything that’s manufactured is smart, connected, and able to self-verify automatically with the help of machine learning tuned to detect errors and potential fraud.

Companies are already seeing the possibilities of applying this bundle of emerging technologies to the supply chain. IDC projects that by 2021, at least 25% of Forbes Global 2000 (G2000) companies will use blockchain services as a foundation for digital trust at scale; 30% of top global manufacturers and retailers will do so by 2020. IDC also predicts that by 2020, up to 10% of pilot and production blockchain-distributed ledgers will incorporate data from IoT sensors.

Despite IDC’s optimism, though, the biggest barrier to adoption is the early stage level of enterprise use cases, particularly around blockchain. Currently, the sole significant enterprise blockchain production system is the virtual currency Bitcoin, which has unfortunately been tainted by its associations with speculation, dubious financial transactions, and the so-called dark web.

The technology is still in a sufficiently early stage that there’s significant uncertainty about its ability to handle the massive amounts of data a global enterprise supply chain generates daily. Never mind that it’s completely unregulated, with no global standard. There’s also a critical global shortage of experts who can explain emerging technologies like blockchain, the IoT, and machine learning to nontechnology industries and educate organizations in how the technologies can improve their supply chain processes. Finally, there is concern about how blockchain’s complex algorithms gobble computing power—and electricity (see “Blockchain Blackouts”).

Blockchain Blackouts

Blockchain is a power glutton. Can technology mediate the issue?

A major concern today is the enormous carbon footprint of the networks creating and solving the algorithmic problems that keep blockchains secure. Although virtual currency enthusiasts claim the problem is overstated, Michael Reed, head of blockchain technology for Intel, has been widely quoted as saying that the energy demands of blockchains are a significant drain on the world’s electricity resources.

Indeed, Wired magazine has estimated that by July 2019, the Bitcoin network alone will require more energy than the entire United States currently uses and that by February 2020 it will use as much electricity as the entire world does today.

Still, computing power is becoming more energy efficient by the day and sticking with paperwork will become too slow, so experts—Intel’s Reed among them—consider this a solvable problem.

“We don’t know yet what the market will adopt. In a decade, it might be status quo or best practice, or it could be the next Betamax, a great technology for which there was no demand,” Lonser says. “Even highly regulated industries that need greater transparency in the entire supply chain are moving fairly slowly.”

Blockchain will require acceptance by a critical mass of companies, governments, and other organizations before it displaces paper documentation. It’s a chicken-and-egg issue: multiple companies need to adopt these technologies at the same time so they can build a blockchain to exchange information, yet getting multiple companies to do anything simultaneously is a challenge. Some early initiatives are already underway, though:

  • A London-based startup called Everledger is using blockchain and IoT technology to track the provenance, ownership, and lifecycles of valuable assets. The company began by tracking diamonds from mine to jewelry using roughly 200 different characteristics, with a goal of stopping both the demand for and the supply of “conflict diamonds”—diamonds mined in war zones and sold to finance insurgencies. It has since expanded to cover wine, artwork, and other high-value items to prevent fraud and verify authenticity.
  • In September 2017, SAP announced the creation of its SAP Leonardo Blockchain Co-Innovation program, a group of 27 enterprise customers interested in co-innovating around blockchain and creating business buy-in. The diverse group of participants includes management and technology services companies Capgemini and Deloitte, cosmetics company Natura Cosméticos S.A., and Moog Inc., a manufacturer of precision motion control systems.
  • Two of Europe’s largest shipping ports—Rotterdam and Antwerp—are working on blockchain projects to streamline interaction with port customers. The Antwerp terminal authority says eliminating paperwork could cut the costs of container transport by as much as 50%.
  • The Chinese online shopping behemoth Alibaba is experimenting with blockchain to verify the authenticity of food products and catch counterfeits before they endanger people’s health and lives.
  • Technology and transportation executives have teamed up to create the Blockchain in Transport Alliance (BiTA), a forum for developing blockchain standards and education for the freight industry.

It’s likely that the first blockchain-based enterprise supply chain use case will emerge in the next year among companies that see it as an opportunity to bolster their legal compliance and improve business processes. Once that happens, expect others to follow.

Customers Will Expect Change

It’s only a matter of time before the supply chain becomes a competitive driver. The question for today’s enterprises is how to prepare for the shift. Customers are going to expect constant, granular visibility into their transactions and faster, more customized service every step of the way. Organizations will need to be ready to meet those expectations.

If organizations have manual business processes that could never be automated before, now is the time to see if it’s possible. Organizations that have made initial investments in emerging technologies are looking at how their pilot projects are paying off and where they might extend to the supply chain. They are starting to think creatively about how to combine technologies to offer a product, service, or business model not possible before.

A manufacturer will load a self-driving truck with a 3D printer capable of creating a customer’s ordered item en route to delivering it. A vendor will capture the market for a socially responsible product by allowing its customers to track the product’s production and verify that none of its subcontractors use slave labor. And a supermarket chain will win over customers by persuading them that their choice of supermarket is also a choice between being certain of what’s in their food and simply hoping that what’s on the label matches what’s inside.

At that point, a smart supply chain won’t just be a competitive edge. It will become a competitive necessity. D!

About the Authors

Gil Perez is Senior Vice President, Internet of Things and Digital Supply Chain, at SAP.

Tom Raftery is Global Vice President, Futurist, and Internet of Things Evangelist, at SAP.

Hans Thalbauer is Senior Vice President, Internet of Things and Digital Supply Chain, at SAP.

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

Fawn Fitter is a freelance writer specializing in business and technology.

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



The Differences Between Machine Learning And Predictive Analytics

Shaily Kumar

Many people are confused about the specifics of machine learning and predictive analytics. Although they are both centered on efficient data processing, there are many differences.

Machine learning

Machine learning is a method of computational learning underlying most artificial intelligence (AI) applications. In ML, systems or algorithms improve themselves through data experience without relying on explicit programming. ML algorithms are wide-ranging tools capable of carrying out predictions while simultaneously learning from over trillions of observations.

Machine learning is considered a modern-day extension of predictive analytics. Efficient pattern recognition and self-learning are the backbones of ML models, which automatically evolve based on changing patterns in order to enable appropriate actions.

Many companies today depend on machine learning algorithms to better understand their clients and potential revenue opportunities. Hundreds of existing and newly developed machine learning algorithms are applied to derive high-end predictions that guide real-time decisions with less reliance on human intervention.

Business application of machine learning: employee satisfaction

One common, uncomplicated, yet successful business application of machine learning is measuring real-time employee satisfaction.

Machine learning applications can be highly complex, but one that’s both simple and very useful for business is a machine learning algorithm that compares employee satisfaction ratings to salaries. Instead of plotting a predictive satisfaction curve against salary figures for various employees, as predictive analytics would suggest, the algorithm assimilates huge amounts of random training data upon entry, and the prediction results are affected by any added training data to produce real-time accuracy and more helpful predictions.

This machine learning algorithm employs self-learning and automated recalibration in response to pattern changes in the training data, making machine learning more reliable for real-time predictions than other AI concepts. Repeatedly increasing or updating the bulk of training data guarantees better predictions.

Machine learning can also be implemented in image classification and facial recognition with deep learning and neural network techniques.

Predictive analytics

Predictive analytics can be defined as the procedure of condensing huge volumes of data into information that humans can understand and use. Basic descriptive analytic techniques include averages and counts. Descriptive analytics based on obtaining information from past events has evolved into predictive analytics, which attempts to predict the future based on historical data.

This concept applies complex techniques of classical statistics, like regression and decision trees, to provide credible answers to queries such as: ‘’How exactly will my sales be influenced by a 10% increase in advertising expenditure?’’ This leads to simulations and “what-if” analyses for users to learn more.

All predictive analytics applications involve three fundamental components:

  • Data: The effectiveness of every predictive model strongly depends on the quality of the historical data it processes.
  • Statistical modeling: Includes the various statistical techniques ranging from basic to complex functions used for the derivation of meaning, insight, and inference. Regression is the most commonly used statistical technique.
  • Assumptions: The conclusions drawn from collected and analyzed data usually assume the future will follow a pattern related to the past.

Data analysis is crucial for any business en route to success, and predictive analytics can be applied in numerous ways to enhance business productivity. These include things like marketing campaign optimization, risk assessment, market analysis, and fraud detection.

Business application of predictive analytics: marketing campaign optimization

In the past, valuable marketing campaign resources were wasted by businesses using instincts alone to try to capture market niches. Today, many predictive analytic strategies help businesses identify, engage, and secure suitable markets for their services and products, driving greater efficiency into marketing campaigns.

A clear application is using visitors’ search history and usage patterns on e-commerce websites to make product recommendations. Sites like Amazon increase their chance of sales by recommending products based on specific consumer interests. Predictive analytics now plays a vital role in the marketing operations of real estate, insurance, retail, and almost every other sector.

How machine learning and predictive analytics are related

While businesses must understand the differences between machine learning and predictive analytics, it’s just as important to know how they are related. Basically, machine learning is a predictive analytics branch. Despite having similar aims and processes, there are two main differences between them:

  • Machine learning works out predictions and recalibrates models in real-time automatically after design. Meanwhile, predictive analytics works strictly on “cause” data and must be refreshed with “change” data.
  • Unlike machine learning, predictive analytics still relies on human experts to work out and test the associations between cause and outcome.

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Shaily Kumar

About Shaily Kumar

Shailendra has been on a quest to help organisations make money out of data and has generated an incremental value of over one billion dollars through analytics and cognitive processes. With a global experience of more than two decades, Shailendra has worked with a myriad of Corporations, Consulting Services and Software Companies in various industries like Retail, Telecommunications, Financial Services and Travel - to help them realise incremental value hidden in zettabytes of data. He has published multiple articles in international journals about Analytics and Cognitive Solutions; and recently published “Making Money out of Data” which showcases five business stories from various industries on how successful companies make millions of dollars in incremental value using analytics. Prior to joining SAP, Shailendra was Partner / Analytics & Cognitive Leader, Asia at IBM where he drove the cognitive business across Asia. Before joining IBM, he was the Managing Director and Analytics Lead at Accenture delivering value to its clients across Australia and New Zealand. Coming from the industry, Shailendra held key Executive positions driving analytics at Woolworths and Coles in the past.