Presented at SharePoint TechFest 2016. All rights reserved.

1. 1© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Vortex
April 6, 2015
Leah Lewis, Director
Digitization Strategist
How to stay ahead of the
dizzying pace of change
ushered in by IoE/IoT

2. 2© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
The Digital Vortex is a Relentless and Chaotic Force
© 2015 Global Center for Digital Business Transformation. All rights reserved.
• Exponentially accelerating Digital Disruption
• It pulls all industries toward the center
• Industries are breaking apart and
recombining
• The center is the “new digital normal”

3. 3© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
To Understand the State of Digital Disruption,
We Conducted a Study
Assess how industries are adapting to this
chaotic force:
Interviewed with 941 business leaders
across 12 industries and 13 countries
Analysed market data, looking at
investment, timing, means, and impact
Ranked industries according to their
proximity to center of the “Digital Vortex”
© 2015 Global Center for Digital Business Transformation. All rights reserved.
Global Center for Digital
Business Transformation

4. 4© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Disruption has Created an Urgent Need for
Transformation
1
In the “Digital Vortex,” 40%
of top ten incumbents will
be displaced.
It could happen in 3 years,
yet nearly half of
companies are not
taking action.
32
Companies must chart their own
course to digital
transformation
This requires challenging
assumptions, changing
organization, culture,
and business models
In the Digital Vortex,
whatever can be digitized
will be digitized
Disruptors are splitting and
recombining industries to
create “combinatorial
disruption”

5. 5© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
The Study Ranked the Industries Most Likely to be Disrupted
Source: Global Center for Digital Business Transformation, 2015
Telecommunications
3.7average
In your industry, how
many companies will lose
their place in the top 10
due to digital disruption
(over next five years)?
Oil & Gas
Pharmaceuticals
Financial Services
Education
Healthcare
Technology Products & Services
CPG & Manufacturing
Hospitality / Travel
Retail
Utilities
Media & Entertainment
Fewer companies at risk
More companies at risk
4.3
survey
question
2.5
In your industry, how
many companies will
lose their place in the
top 10 due to digital
disruption over next
five years?
What will your company be?
Disruptor or Disrupted
43%
37%
Average
25%

6. 6© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Definitions
Source: Global Center for Digital Business Transformation, 2015
Digital Enterprise
An ideal end-state whereby an enterprise is fully
technology-enabled and optimized.
Digital Transformation (Digitizing)
The process by which an organization becomes
digital.
Digital Disrutption is a force that
amplifies competition: which can
come from any anyone, at any time
and from any industry

7. 7© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Disruption: Top 3 Impacts
2. Industries will split and recombine – aka
“Combinatorial Disruption”
1. Every company will be a “Tech”
3. Real Time is too late

8. 8© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital disruption
threatens
all types of
organizations
Digital Disruption Is a Constant Force
Digital
disruption
creates new
value
What is fueling the Vortex?
• The Internet of Everything/Things
• The Modern Consumer
• The Modern Employee

9. 9© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Delivering the right
information to the right
person (or machine)
at the right time
Process
Physical devices and objects
connected to the Internet
and each other for intelligent
decision-making; often
called Internet of Things
(IoT)
Things
Connecting people
in more relevant,
valuable ways
People
Leveraging data
into more useful
information for
decision-making
Data
The Internet of Everything Is Fueling the Digital Vortex

10. 10© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
The modern consumer is fueling the Digital Vortex

11. 11© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Born with cell phones in hand, they account for
more than 1/3 of the US labor pool and
represent tremendous spending power
The Modern Consumer:
How Millennials are Fueling Disruption
1. Millennials expect technology to work
2. If it doesn’t work on mobile, it doesn’t work
3. They are the first social generation and they socialize
while consuming or deciding to consume your
products
4. They demand self-service options, and crave a
personalized experience
5. They are passionate about values, including the
values of the companies they do business with

12. 12© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
…so is the modern employee

13. 13© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
The anytime, anywhere
workplace
The Modern Employee:
How Millennials are Changing the Workplace
1. Mobile & flexible workspaces are a must
2. Performance is measured in results not time behind the desk
3. Globalization, the increase in freelance workers and
competition are driving anytime – anywhere workspaces
4. This talent pool picks companies that match their values, so
your brand is important

14. 14© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Examples of Digital Disruption

15. 15© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Industry Boundaries Are Dissolving
Oil & Gas Transportation Technology
Electric
Utilities
Industries Being Unbundled
Automotive

16. 16© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Disruption in Sports
• Fantasy Sports or Betting?
Every event, every fan, every sport
"As fans choose between the sofa and the stands, teams can’t just fix pain points in the stadium experience, they
must create and extend moments of joy that can only be experienced at live events.”
Brian Quinn, Principal, Doblin
• Merchandise
• Fan Experience / How do you watch?

17. 17© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Disruption: A Competitive Edge for Elite Athletes
• Competing / Training
• Connecting to the Event

18. 18© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Industry Transformation
RetailFinancial Services Public SectorOil & Gas Manufacturing

19. 19© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Transformation’s Impact On The Global Economy
Healthcare
$1.4T
Manufacturing
$6.4T
Oil & Gas
$1.1T
Financial Services
$3.1T
Retail
$2.8T
Top 10 industries for Digital Value at Stake, 2015-2024
Service Provider
$2.0T
Transportation
$845B
Administrative /
Waste Management
$899B
Construction /
EPCM
$779B
Arts / Ent. /
Recreation
$706B
Source: Cisco, 2015

20. 20© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Top Private Sector Opportunities by Industry
Manufacturing
1. Predictive Maintenance (Analytics)
2. Quality & Defect Controls
Automation
3. Energy Management
4. Connected Products Maintenance
5. Remote Maintenance
6. Visual Factory
7. Assembly Line Changeovers
Financial Services
1. Omnichannel Capabilities
2. Mortgage Advisor / Video-based
Experts
3. Wealth Management — Asset
Transfer
4. Mobile Banking & Payments
5. Self-serve Segment / Direct
Relationship
6. Virtualized Delivery Model
7. Claims Management
Retail
1. In-store Analytics
2. Remote Expert
3. Theft / Physical Security
4. Endless Aisles
5. Checkout Optimizer
6. Smart Lockers
7. Out-of-stock Optimizer
1. SP as an IOT Enabler
2. Network Transformation
3. Personalized Service (Analytics)
4. Churn Control
5. Intelligent Marketing
6. Safety and Security
7. Home Network Remote Access
Telecom SP
Healthcare
1. Patient/Medication Safety
2. Predictive Equipment
Maintenance
3. Big Data Analytics
4. Administrative Process
Automation
5. Physician Performance Analytics
6. Consumables Tracking
7. Healthcare Claims Management
Oil & Gas
1. Recovery Efficiency
2. Lifting-Process Automation
3. Remote Monitoring
4. Drilling Optimization
5. Project Planning
6. Oil-spillage Control
7. Spares / Inventory Management
Transportation
1. Predictive Maintenance
2. Analytics-driven Fuel
Efficiencies
3. Driver Efficiency
4. Connected Train
5. Smart Stations
6. Below-Wing Operations
7. Connected Track & Trackside
“Horizontals”
1. Mobile Collaboration
2. Digital Advertising
3. Cyber Security
4. Smart Grid
5. CoE for Support Functions
6. Supply Chain
7. Connected Workplace
8. Telecommuting
9. SME Virtualization
10. Payments
$23.8T
Private Sector
Source: Cisco, 2015

21. 21© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Financial
Services

22. 22© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
* For $10 billion bank (U.S.)
or $5 billion bank (all others)
Source: Cisco, 2014
(7294 global respondents)
Customers want high-value
services anytime, anywhere
75%
would move their money
for one or more digital concepts, including:
1. Mobile Payments
2. Virtual Financial Advice
3. Virtual Mortgage Advice
4. Automated Advice
5. Branch Recognition
Banks can improve loyalty
using digital transformation
Implementing digital concepts to
improve advice and create
convenient and contextual
customer experiences can
deliver profit increases of
*up to 15.2%
The Financial Services Industry is Experiencing an
Erosion of Customer Loyalty…
Source: The Advice Advantage, Cisco 2014

23. 23© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Kenya’s Financial Transformation: Impacting Global Banking
Safaricom’s M-PESA
Want to text money? Kenya's been doing it for years
The future of money is already happening in Kenya where a mobile phone-based
payment system was born out of necessity.
CBS 60 Minutes November 19, 2015
How did a cellular provider become a bank?
1. Born out of necessity
2. Improved Safety
3. “Bankless Banking”
4. Sparking development in rural areas
5. 85,000 Kiosks

24. 24© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
“Neo-Banks”
Specialize in mobile or online banking, without a bank charter
Technology Companies
Payment Companies
Automated Investment Services
Digital-Only Banks
Fully chartered
Retailers
Provide branded financial services
Moving
into
traditional
banking
space
… And New Comers Are Ready To Capture This Market
Source: The Advice Advantage, Cisco 2014

25. 25© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Retail

26. 26© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Social
Apps
Mobile
Big Data
Evolving Consumer Expectations Are Disrupting the Retail
Landscape
U.S. omnichannel retailers
with Facebook pages
(Q1 2014)1
1: The E-tailing Group, 2014; 2: ComScore, 2014
94%
U.S. shoppers that use
mobile retail apps at least
weekly while shopping
64%
retailers that foresee
significant growth in
amount of data captured
by their networks
88%
year-over-year growth
of mobile commerce
(Q2 2014)2
47%
Retail
Disruption
Same customer, different shopper
The customer’s needs
change with each interaction
Technology Customer Expectations

27. 27© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Retail Concepts Delivers an Integrated, Hyper-
Relevant Shopping Experience
Hyper-
Relevance
enables
consumers to
receive what
they want, when
and how they
want itSource: The Hyper-Relevant Retailer, Cisco 2014

28. 28© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Public Sector

29. 29© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
The Public Sector Will Have a Huge Impact on the Economy
Cities
$817B
Digital Value at Stake, 2015-2024
Healthcare
$709B
Education
$101B
Infrastructure
$538B
Transport
$282B
Defense
$1.7T
Employee
$1.8T
Public Sector
$5.9T
Source: Cisco, 2015

30. 30© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
How many people are moving into cities
around the globe…per hour?

31. 31© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
A 10 ppl/hr B 100 ppl/hr
C 1,000 ppl/hr D 10,000 ppl/hr

32. 32© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Cities worldwide are
urbanizing at the rate
of… 10,000 people
per hour!
Equivalent to one new
LONDON every month!

33. 33© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Rapid Urbanization Requires Digital Transformation
Traffic Congestion
Mass Transit
Parking
Affordable Housing
Attracting Skilled Workers
and Talent
Social and Environmental
Sustainability
Public Safety,
Preparedness, and
Resiliency
Safer
Greener
Faster
More Responsive
Accessible
Sustainable
Livable

34. 34© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Pervasive connectivity

35. 35© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
…is creating a fully connected, unsurpassed citizen experience
P

36. 36© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Top Public Sector by Category $5.9T
Public Sector
City
1. HH Gas Management
2. Smart Lighting
3. HH Electricity Management
4. Video Surveillance
5. HH Water Management
6. Smart Buildings
7. City WiFi
8. Tourism
9. Smart Lotteries
10. Water Management
11. Disaster Response
12. Waste Management
13. Fleet Management
14. Wildfire Suppression
15. Pedestrian Analytics
16. Building Water Management
17. Correction Visits
18. Snow Plows
19. Offender Transport
20. Emergency Text/Voice
Education
1. Connected Learning
2. Higher Education
3. Campus Wi-Fi
4. Campus Student Services
Transport
1. Expressway Management
2. Congestion Charging
3. Local Metro
4. Parking
5. Railway passengers (PS)
6. Traffic control
7. Connected Bus
8. Connected Fleets
Infrastructure
1. Patient Benefits
2. Hospitals
3. Particulate Monitoring
4. Noise Monitoring
5. Allergen Monitoring
Healthcare
1. Smart Transmission Grid (PS)
2. Open Data
3. Cybersecurity (PS)
4. Fast IT
5. Next-Generation Broadband
6. Bridge Monitoring
7. Connected Stadium
.
Employee
1. Mobile Collaboration BYOD (PS)
2. Collaborative Connected Workplace
3. Telecommuting (PS)
4. SME Virtualization
5. Remote Kiosks
6. Business Travel Avoidance (PS)
7. CoE for Support Functions
8. Virtual Attendants
9. Virtual Trainer
10. Virtual Desktop Saving (PS)
Source: Cisco, 2015

37. 37© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Even with the Risk of Market Turbulence, Most See
Digital Vortex as a Force for Good
…is a form
of progress
…improves
value for
customers
Digital disruption…
(75%)
(72%)
…empowers
individuals
(66%)
…is good
for society
(63%)
…improves
quality of life
(63%)
Respondents who “somewhat” or “strongly” agree with each of these statements
Source: Global Center for Digital Business Transformation, 2015

38. 38© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
…But Most Companies Are Not Responding
Does not
recognize
or is not
responding
appropriately
Taking
“follower”
approach
Actively
responding
43%
32%
25%
Responses to Digital Disruption
In general, what is the attitude of your
company’s leadership toward digital disruption?

39. 39© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
…So How Do We Get Started?
1. Boardroom Mindset
2. IT’s New Roles
3. Fast IT – An Operating Model
4. Assess Your Digital Maturity
5. Focus on the Network as the Platform
6. Turn Data Into Insights

40. 40© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Transformation is a Boardroom Mindset
Changing Culture, Technology and Business Models
UPS My Choice
Delivery Control
Personalized Service
Customer Experience
Physical and Virtual
RFID Content
Workforce Efficiency
WIP Inventory and
Part Tracking
American Express
Personalized Service
Through Mobile
40© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Starbucks Apps
Order Ahead
Skip the Line
3 Attributes for Success: Hyper Aware, Predictive, Agile

41. 41© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Optimizer
Optimize business
processes
Machine 2 Machine /
Augmented Decisions /
Analytics
Efficiencies – digitize
everything and everywhere
41
IT’s New Roles
Accelerator
Take ideas and move
them to production
quickly
2.0
Accelerate time from
innovation to exectuion
Distributed Connectivity
and Intelligence
Enabler
Provide the platform for
Innovation
Reduced Costs
(Opex and Capex)
Faster Response Times
to Customer Needs

42. 42© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Digital Transformation Requires “FAST IT”
An IT Operating Model
Reduce Complexity
Enable Open/programmable
infrastructure
Automate Everything
Simplify
Capitalize on Data
Improve Visibility
Process contextual data:
in motion and at the edge
Think Smart
IT should create the platform for others to innovate on
Before: discover, harden, enforce
During: detect, block, defend
After: scope, contain, remediate
Drive Security

43. 43© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Customer Experience
Assess Your Digital Maturity
Fundamentals for collaborative
experiences
Collaboration
Imperative
Workforce Experience
Business Imperative
How invested are your leaders?
Are they investing? Create Omni-
Channel
Experience
Predict Customer
Behavior Using
Analytics and Insight
Enhance Point of
Sale and Service
Experience
Enable Digital
Workforce
Transform the
Workplace
Deliver Effective
Meetings and Training
Virtual
Expertise
Mobile
Experience
Digital Branch
Platform
Workspace
Management Tools
Mobile
Workspace
Tech-Enabled
Workspace
Business Process
To what level are you digitizing your
processes?
Provide remote
expertise to any
location or device
Differentiate shoppers
based on their
shopping patterns
Recognize Branch
customers upon entry for
personalized service
Locate and reserve
meeting rooms via
mobile device
Allow secure
remote access
via mobile device
Enable employees
to join meetings
from any device

44. 44© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Success Requires Connectivity
App
Experience
(Akamai)
Network as
a Sensor/
enforcer
Virtualized
WAN
Services
LAN/WAN
Policy, Orchestration, Ecosystem Partners, Security
Cisco
UCS
Cisco
Nexus
ACI
Programmable Fabric
Programmable Network
Policy-Based, Open
Integrated
Infrastructure
Cisco and Partner
Intercloud
Services
Cisco ONE
Enterprise Cloud Suite
Cisco
OpenStack Private
Cloud
Cisco
Connected
Analytics
Unified
Access
IoT
System
Cloud-
Managed
Mobility
Express
Make sure you have a Digital Ready Network
Simplify, Modernize, Optimize

45. 45© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Your Platform For Innovation Is Your Network

46. 46© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Turn Data into Insights
Analytics
will drive nearly
To progress from data
to insight requires
analytics across:
People
Process
Things
Analytics at the “edge”
[at or near the location where
the data is generated]
can be particularly valuable
where there are latency or
bandwidth constraints
of IoE Value
40%
Source: Cisco Consulting Services, 2014

47. 47© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
Lead from the Top Down
Digital transformation must involve the
executive leadership team and the board
Create the Workforce of the Future
Transformation requires workers
that are tech savvy, creative, and
accustomed to constant change
Digitize Everything
Knock down silos and drive new culture of
digitizing all of your processes, products
and buildings
Thriving in the Digital Vortex
Ideate and Innovate Fast
Endow employees with the tools, data,
processes, and information to excel
Simplify and Modernize your IT
Reduce the complexity of your systems.
Ensure you have a foundation that
supports the rapidly growing demand for
connectivity
Connect Everything
….modernize your network so you can
provide the platform for innovation

48. 48© 2015 Cisco and/or its affiliates. All rights reserved. Cisco Confidential
At the blistering speed of Digital:
How will the Digital Vortex change your life?