Tech Vision 2020 Interactive Report
Full Interactive Report | 141 Pages
#TECHVISION2020 TECHNOLOGYVISION 2020 , WE THE POST-DIGITAL PEOPLE Can your enterprise survive the tech-clash? INTO THE NEW Provocative thinking, transformative insights, tangible outcomes
TREND TheIin Experience 1 TREND 2 AI andMe TREND TheDilemma 3 ofSmartThings TREND Robots in 4 theWild TREND Innovation 5 DNA
Foreword From tech-clash to But the existing business and technology models that The theme of our Accenture Technology Vision this organizations have used for years are under increasing year—We, the Post-Digital People—describes what is trust: organizations scrutiny. Despite broadly using and benefitting from happening now and outlines new ways for enterprises need to focus on technology, people are expressing concerns about to build a better, human-centered future. Once again, how it is used and what it is used for. And they are technology is the catalyst to steer the realignment. value and values advocating for change. Companies that take the lead with a shared-success mindset—and invite collaboration with customers, In a world where digital is everywhere, people’s The message? In the future, people don’t just want employees, ecosystem partners, governments and interactions across society are changing. They are more technology in our products and services; the public—will create new opportunities for growth reevaluating their relationships with businesses and we want technology that is more human. in a way that benefits all. governments. They are rethinking their actions in a globally interconnected economy and seeking more Enterprises that ignore this message will face an This year marks the 20th anniversary of our Tech Vision, sustainable products and services. And they are existential tech-clash, in which today’s models are and we are proud to share it as part of Accenture’s reexamining whether the value that enterprises incongruous with people’s needs and expectations. deep commitment to your organization’s ongoing deliver is fully aligned with their core values. To avoid this impending crisis, companies must success. We look forward to helping you think about reexamine their fundamental business and technology what comes next, using these tech trend insights and Technology is an intrinsic part of this process, models in a responsible way—to create a new basis pragmatic steps to drive tangible business value and to the point where it has become deeply embedded for competition and growth. widespread societal trust. in how people work and live. Enterprises have furthered this reliance by weaving technologies Trust and accountability are the new litmus tests for into their product and service offerings and how businesses in a world where digital is everywhere. they are delivered to customers. Creating a more inclusive future that is better for all Julie Sweet Paul Daugherty people is the new mindset. Success will require an Chief Executive Officer Chief Technology & innovative approach to innovation itself. Innovation Officer
We, the Post-Digital people People’s love for technology has let businesses weave it—and themselves— into our lives, transforming the way we work, live and interact with the world. But that unconditional love is starting to fray, and it’s increasingly clear that the approaches companies took to reach this point won’t take them any further.
Even as people’s expectations for their Companies already aspire to this type of future with technology continue to grow, human-centered experience. But even though many enterprises’ attempts to deliver on those the technology exists to build it, implementation expectations are being rejected. Companies remains out of reach. Models that companies need to build a new path forward, developing have been relying on for decades are becoming new models that bring a human focus. roadblocks. Closed ecosystem models mean different levels of technology access and Imagine a world with seamless, secure and different standards, creating obstacles to smooth personalized healthcare. Wearables give doctors experiences. Application-centered data models instant access to patients’ real-time and past vital create fragmented, even conflicting, data about signs. Digital healthcare records automatically patients, while innumerable go-betweens, incorporate results and notes from different regulators and gatekeepers can often add providers, with no delayed requests for records friction—not value—to the experience. Meanwhile, or decisions made on incomplete information. concerns about security, privacy and ethical issues All the while, artificial intelligence (AI)-powered keep patients and providers alike wary of new machines use these records to make technological solutions. preventative recommendations.
This is a conundrum playing out across all industries The promise of a world made better and easier by Enterprises are facing their next big challenge. Up until technology is being trapped behind models, architectures now, businesses have largely benefited from following and governing structures that have not realized their full the technology roadmap laid out by digital pioneers. potential nor created adequate value—leaving companies Now, digital technology is evolving from an advantage out of sync with people’s needs and expectations. to a basic expectation—and yesterday’s best practices are turning into today’s shortcomings. To grow and Despite this tension, businesses aren’t slowing down with compete, enterprises will need to revisit their fundamental their agendas; in fact, many are unknowingly speeding models of business and technology, rebuilding them toward technological deadlock. They’re poised to flood the to align better with people today. world with purportedly smarter products and services like intelligent assistants and immersive experiences—offerings that hold deeply transformative potential for both people and the enterprise. But enterprises are embedding digital everywhere just as customers and governments are bringing more scrutiny to the role technology plays in their Enterprises are facing their next big lives. With technology as the foundation of the enterprise, leaders need to update their models and bring business challenge. Up until now, businesses value in line with people’s values, or future innovations stand to be rejected and fail. have largely benefited from following the technology roadmap laid out by digital pioneers.
Every business assumption and entrenched approach is up for review and reinvention toward people-centric models. Companies Leading in the future must reengineer the experiences that bring people and technology together; they must raise questions about the democratization will demand rethinking of data and technology, and they must reevaluate the application and value of intelligence—what technology is providing for people, and the ways it’s changing people in the process. core assumptions about This reimagination of the enterprise offers tremendous opportunity how an enterprise to those that take the lead. In every industry, companies’ current successes are happening in spite of their foundations, not because works and redefining of them. When leaders successfully rebuild their technology models to deliver the human focus they’ve lost, they will be poised to do far more than meet expectations. They’ll set the new standard that the intersection every competitor—in every industry—will be forced to try to meet. between people Getting there is the greatest challenge the C-suite will face during the next decade. The success of the next generation of products and technology. and services will rest on companies’ ability to elevate the human experience. None of the steps on the journey are incremental changes, nor are they as simple as finding the next technological tool to do what you’re already doing today. Leading in the future will demand rethinking core assumptions about how an enterprise works and redefining the intersection between people and technology.
People are changing. Why aren’t you? To move forward, enterprises must first acknowledge the essential role technology plays in people’s lives today, and how that relationship is changing. The reason that the increasingly strong and symbiotic connection between people and technology is meeting resistance is not because technology has ceased to be valuable. It’s because enterprises have not yet re-oriented to just how meaningfully people treat technology today.
In retrospect, this isn’t surprising Just 20 years ago, digital access was limited by dial-up Not only is technology a symbiotic part of people’s lives, connections and desktop PCs, and individuals remained it’s also being embedded in the building blocks of society. predominantly anonymous online. Tools like e-mail, forums Take the evolution underway in education: China is investing and e-commerce were more efficient or far-reaching than $30 billion in edtech by 2020 to ensure its 230 million K-12 analog counterparts, but hardly vital to people’s existence. students have access to individualized learning platforms.6,7 52% Companies didn’t need to closely consider the impact of In Indonesia, non-profit group Room to Read is closing the technology in their customers’ lives; our digital lives were country’s illiteracy gap by building an open-source platform distinctly separate from our “real” ones. that provides access to children’s stories, literacy education 8,9 videos and training videos for teachers. And technology It’s hard to find that kind of separation today as technology isn’t just transforming how people learn, but also what they has become an inextricable part of the human experience. learn: bootcamps that teach coding and web development 10 of consumers say that More than half the world’s population—a whopping 4.5 billion skills have grown 11x in the last six years. 1 people—have access to the internet. People are ever- technology plays a prominent connected on every type of device, globally spending an Given the starring role technology has in people’s lives, role or is ingrained into 2 average of 6.4 hours online daily. Even distinctions about it makes sense that we take technology personally—and why almost all aspects of their “screen-time” are becoming an obsolete way to look at reality as we expect so much more from it going forward. Just as many day-to-day lives. An additional technology permeates the physical world. Daimler is integrating current models fail to account for the growing impact of 19% report that technology intelligent voice control into its Mercedes-Benz vehicles, letting technology, our unconditional love for unlimited technology 3 is so intertwined with all drivers ask their car questions about traffic, weather and more. is fading. Some are labelling today’s environment a “tech-lash,” aspects of their day-to-day Samsung’s digital assistant Bixby is interacting with people in or backlash against technology. But that description fails to their homes via the company’s FamilyHub line of refrigerators.4 account for the fact that we’re using technology more than lives that they view it as an And the last mile is becoming a thing of the past as companies ever. Rather, it’s a tech-clash—a collision between old models extension of themselves. like FedEx, Amazon and Postmates use robots and drones that are incongruous with people’s current expectations. for delivery right to customers’ doorsteps.5
Some are labelling today’s environment a “tech-lash,” or backlash against technology. But that description fails to account for the fact that we’re using technology more than ever. Rather, it’s a tech-clash—a collision between old models that are incongruous with people’s current expectations.
Smart products are appearing everywhere, but businesses This deadlock must be broken, or the progress of the create walled gardens around them, turning a world last 20 years will grind to a halt. Governments from the of unprecedented choice and customization into one European Union, United States, Brazil and other countries of ecosystem lock-in. Privacy and security concerns are attempting to ease the burden by creating new rules, 13, 14, 15 around the troves of valuable data people produce lead guidelines and practices. But lawmakers are limited to hesitation and distrust. AI is being applied to bigger to addressing or changing existing models—not building challenges, but is still largely focused on automation, new ones. The true path to solving the tech-clash rests in leading people to worry about losing their livelihoods. the domain of the enterprise, driven through what products and services companies build and how they offer them And the issues leading to tech-clash are changing to customers, employees and ecosystem partners. constantly as technology becomes ever more prominent in people’s lives. AI systems today are being used to For people to accept the flurry of new product and service decide whether a job candidate should proceed to an innovations that companies are eager to introduce, a major interview or recommend whether criminal defendants reckoning must take place. Companies must synchronize 11 should be allowed to post bail. As the capabilities of the business and technology models that drive enterprise AI-driven systems have grown beyond automating value with people’s evolving expectations. boring or repetitive tasks, to making decisions that directly impact people’s lives, the fact that many of these systems are still “black-box” leaves people skeptical 12 about the fairness and effectiveness of the algorithms. 11
Leaving the roadmap behind With the roadmaps of the past two decades, companies successfully wove technology throughout the business, but tech-clash makes these blueprints irrelevant going forward. What does that mean for enterprises? There’s no defined path left to follow. Everyone is working from the same blank slate, but that doesn’t mean they’re working with nothing. There’s a larger guiding light: companies should look to people’s core values to see how success could take shape.
Businesses must challenge existing models But where people’s expectations are outgrowing to create something wholly new. Inventing today’s standards, disruptors see the beacon of 76% a better, human-centered future for people opportunity. One company introducing a new requires a virtuous circle of trust, data and model for this relationship is Inrupt, a startup deeper experiences. founded by Tim Berners-Lee (the originator of the world wide web) and a business partner to 16 Consider just one of the challenges today’s scale a data-linking architecture called Solid. models create. People’s information—whether medical, shopping or other data—is generated, The Solid movement emphasizes trust. Individuals’ stored, shared, accessed and controlled by the data is stored and used across the web through companies and ecosystems with which they do “pods,” which can contain personally identifiable of executives agree business, and sometimes even by businesses information, financial records, contact lists, with whom they have no direct relationship. content subscriptions and more—but people that organizations need As these ecosystems grew to provide expansive can decide where their personal data is hosted to dramatically reengineer personalization and valuable services, companies and determine which companies or machines the experiences that bring were relied on to steward more data and manage can access their pods. They can also revoke technology and people increasingly complex relationships. But now that access at any time and even delete all together in a more customers are growing hungry for more input their information with a click of a button. It’s the human-centric manner. on how their data is used, and many businesses beginning of a new kind of platform that gives lack the mechanisms needed to provide that people more agency and builds clear lines engagement. In this absence, customers can of sight for companies about how to best grow wary of businesses and potentially distrust engage with customers. them too. Governments, sensing that distrust, are looking to impose consumer access and control requirements on personal data.
Opportunities are knocking These new models represent new ways to unlock There are opportunities to reimagine models distrust around autonomous technology. value for both customers and enterprises alike. across all dimensions of technology. Microsoft Volvo and Perceptive Automata are working For instance, the Known Traveller Digital Identity is redesigning experiences and rethinking together to build safer autonomous vehicles by (KTDI) program, a World Economic Forum initiative interoperability models to meet customers’ new pairing computer vision with behavioral science to deliver a better travel experience by shifting expectations. The company announced its Xbox and neuroscience to understand the intention 19, 20, 21 the paradigm on how data is shared through One entertainment system would start supporting and awareness of pedestrians. By teaching 17 the ecosystem. The blockchain-based solution Amazon’s Alexa and Google Assistant—a departure autonomous vehicles about human intuition encrypts an individual traveler’s critical identity from the ecosystem playbook of the past, where and why people might act the way they do, data, like passport information, and stores it on the technology and standards were used to push the companies are making it safer for these 18 traveler’s own personal mobile device. With the customer choice in a particular direction. Rather, vehicles to operate on busy streets. old model, a traveler’s personal data is taken and Microsoft is respecting individual consumer’s stored by a different entity every time the person preferences and ecosystem choices, setting As a variety of technology models hit their goes through passport control, buys an airline themselves on a new path for success. breaking point, they herald a bigger shift that ticket or books a hotel room. With KTDI, the traveler enterprises in every industry must note: people alone can determine who gets what access and And with technologies increasingly able to will no longer be bystanders when it comes when—fundamentally placing the human at the have a physical impact in our lives, trust is among to technology. Whether it’s security standards center of the ecosystem. With data access being the important guiding lights in developing misaligned with today’s interconnected ecosystems, revoked when the transaction is completed, the new models of operation. Look at autonomous bad actors leveraging the content neutrality of system maximizes efficiency and mitigates security vehicles. These cars use a wide array of sensors social platforms to amplify misinformation, or risks for all parties. and AI to “see” the world around them, but government regulations that are years behind the people are already aware of close calls during technology itself, expectations are not being met test situations and, in one case, a pedestrian —and the resulting tech-clash demands action. fatality, giving rise to serious concerns and
Building a foundation of trust Diffusing tech-clash begins with new models, but it’s imperative for companies to adopt a broader perspective. Disruptive technology opened the door for enterprises to take a deeper and more influential position in shaping the world. With impact that now resonates beyond customers and employees alone, every business must hold itself accountable for its role across society. Failure to acknowledge this growing impact will push people to reject even the best of intentions as trust becomes currency in an era where digital is everywhere.
Microsoft is embracing a model of accountability that goes far Business leaders must adapt for the world they’ve created. beyond its products or customers. Responding to the impact the Sticking with yesterday’s models isn’t just a risk around annoyed tech boom is having on Seattle’s housing prices, the company customers or disengaged employees; it’s a permanently limited 22 pledged $500 million to build affordable housing in the city. potential for future innovation and growth. But it doesn’t have to be Similarly, as Microsoft has researched and developed more this way. Tech-clash is a challenge waiting to be solved: people still advanced technology, it has strived for responsible innovation. love technology. The enterprises that find a way to deliver it in line Most notably, the company built an ethical framework to guide with people’s expectations will blaze the trail for everyone else. its development of AI and backed state legislation around proper use of facial recognition technology.23,24 Is your company ready to deliver human-centered experiences? The world is ready for you. Businesses across all industries are also beginning to acknowledge that they have a responsibility to a larger range of stakeholders. In 2019, chief executives of nearly 200 major companies, including Accenture, signed a letter indicating this shift: that shareholder value should not be the only metric of success. The signatories took a more holistic approach, pledging to expand investments in employees, protect the environment and work ethically with supply chain providers.25 The enterprises that find a way to deliver it in line with people’s expectations will blaze the trail for everyone else.
2020 Tech Trends To truly bring a human touch to the next decade, the new models that enterprises build must be rooted in collaboration. As technology’s level of impact grows ever higher throughout society, successful businesses will be those that use new models to invite people—customers, employees, partners or the public—to co-create their new course for the future.
Our five tech trends this year: The I in AI and Me The Dilemma Robots in Innovation Experience Reimagine the of Smart the Wild DNA Helping people business through Things Growing the Create an engine choose their human and AI Overcome the enterprise’s reach— for continuous own adventure collaboration and responsibility innovation Take a new approach that “beta burden” Redesign digital experiences uses artificial intelligence Address the new reality Build new models of Tap into the unprecedented with new models that amplify to bring out the full power of product ownership in interaction and impact scale of disruptive technology personal agency. Turn of people. Move beyond the era of “forever beta.” as robotics move beyond available today. Build the passive audiences into active deploying AI for automation Transform pain points the walls of the enterprise. capabilities and ecosystem participants by transforming alone and push into the new into an opportunity to Companies in every industry partnerships necessary to one-way experiences into frontier of co-creation between create an unprecedented will unlock new opportunities assemble the organization’s true collaborations. people and machines. level of business- by introducing robots to the unique innovation DNA. customer partnership. next frontier: the open world.
Completing 2020 The I in The Dilemma Robots in Innovation Trends Experience AI and Me of Smart the Wild DNA the picture Things Accenture’s Technology Vision report comprises a three-year set of technology 2019 DARQ Get to Human+ Secure trends, currently including Trends Power Know Me Worker US to MyMarkets trends from 2019 and 2018. Secure ME It’s important to recognize that each year’s trends are part of a bigger picture. Tracking how they evolve over time offers a glimpse into how they may continue to grow in the future. 2018 Citizen AI Extended Data Frictionless Internet Trends Reality Veracity Business of Thinking
2019 Trends DARQ GET TO HUMAN+ SECURE US MYMARKETS POWER KNOW ME WORKER TO SECURE ME Unlock unique Change the Enterprises are Meet consumers’ Understanding customers and workplace or hinder not victims, needs at the the DNA of DARQ speed of now New technologies are catalysts unique opportunities the workforce they’re vectors Technology is creating for change, offering businesses Technology-driven interactions Workforces are becoming While ecosystem-driven business a world of intensely customized extraordinary new capabilities. are creating an expanding human+: each individual is depends on interconnectedness, and on-demand experiences, Distributed ledger technology, technology identity for every empowered by their skillsets and those connections increase and companies must reinvent artificial intelligence, extended consumer. This living foundation knowledge plus a new, constantly companies’ exposures to their organizations to find and reality, and quantum computing of knowledge will be key to not growing set of capabilities made risks. Leading businesses are capture those opportunities will be the next set of new only understanding the next possible through technology. recognizing that just as they as they come. That means technologies to spark a step generation of consumers, Now, companies must adapt already collaborate with entire viewing each opportunity change, letting businesses but also to delivering rich, the technology strategies that ecosystems to deliver best-in- as if it’s an individual market reimagine entire industries. individualized, experience- successfully created this next class products, services and —a momentary market. based relationships in the generation workforce to support experiences, it’s time security post-digital age. a new way of working in the joins that effort as well. post-digital age.
2018 Trends CITIZEN AI EXTENDED DATA FRICTIONLESS INTERNET REALITY VERACITY BUSINESS OF THINKING Raising AI to Benefit The Importance Built to Partner Creating Intelligent Business and Society The End of Distance As artificial intelligence grows in Virtual and augmented reality of Trust at Scale Distributed Systems its capabilities—and its impact technologies are removing the By transforming themselves Businesses depend on Businesses are making big on people’s lives—businesses distance to people, information to run on data, businesses technology-based partnerships bets on intelligent environments must move to “raise” their AIs to and experiences, transforming have created a new kind for growth, but their own legacy via robotics, AI and immersive act as responsible, productive the ways people live and work. of vulnerability: inaccurate, systems aren’t designed to experiences. But to bring these members of society. manipulated and biased data support partnerships at scale. intelligent environments to that leads to corrupted business To fully power the connected life, they must extend their insights, and skewed decisions Intelligent Enterprise, companies infrastructures into the dynamic, with a major impact on society. must first rearchitect themselves. real-world environments they want to reach.
Trend 1: The I in Experience Helping people choose their own adventure
Redesign digital experiences with new models that amplify personal agency. Turn passive audiences into active participants by transforming one-way experiences into true collaborations.
In Netflix’s Black Mirror: Bandersnatch, viewers make decisions for the main character—listen to this song, throw that cup of tea, bury the body. It’s an interactive choose-your-own-adventure episode of the larger sci-fi series, with five possible endings 1,2 and millions of ways to get there. Audience feedback was so positive that Netflix This may seem like an entertainment industry fad, announced it would develop two new interactive but it reflects a growing opportunity for businesses 3,4 shows. And it’s not the only one. YouTube, which of all kinds: building cooperative experiences. These has experimented with interactive advertising, cooperative experiences are the next generation of started developing a choose-your-own-adventure business offerings, where enterprises are becoming 5 original series. Audible released interactive collaborative partners in experience creation, not audiobooks for kids, prompting them to participate just providers of it—ultimately transforming their 6 via their Amazon Echo devices. The BBC decided relationships with customers. to celebrate the 1,000th episode of its technology news show “Click” with a branching narrative, 7 personalized and localized for individual viewers.
Take McDonald’s, which is introducing a cooperative and technology services on top of their offerings, element by giving employees more control over their adding immense value to the customer experience. workplace experience. The company is rolling out However, this has increasingly committed companies digital ordering kiosks in its drive-thrus across the US, to the same limited path: inadvertently taking control featuring personalized menus and recommendations away from people in the name of greater curation. based on weather, time of day, trending menu items Now, enterprises are dealing with a major side and customers’ past purchases.8,9,10 But rather than effect. While customization can create powerful prescribe the menu based on centralized data, and beneficial experiences, it can also frustrate employees are given the freedom to change menu people with unintended results. displays based on local circumstances. They can use live traffic data and observational insights to identify For instance, researchers at Harvard’s Berkman Klein peak times, and switch the menu recommendations Center found that the personalized recommendation to promote simpler items, easing the burden on system of a popular video streaming platform was employees and restaurant operations. leading viewers to increasingly radical content, contributing to the rise of conspiracy theories 11 This might seem like typical customization at first and spread of misinformation. In response to this glance. But what McDonald’s does differently is unintended consequence, the platform added make the individual—in this case the employee—an new features explaining why viewers see certain active and necessary contributor to the experience. recommendations and giving them more 12 It’s a powerful shift from the norm. Throughout the control over the experience. digital age, companies have built customization
Aging customization models are the root of the problem Businesses have built robust data gathering and analytics only 17 percent of respondents said they thought practices, which largely operate behind the scenes to personalized ads were ethical, and only 24 percent 66% 13 determine what customers want and deliver targeted said personalizing newsfeeds is ethical. personalization. But as businesses expand their experience delivery and customization capabilities, those behind- Demand is shifting. People want customized experiences, the-scenes techniques are inadvertently, but increasingly, but they don’t want their experiences overly determined pushing customers out of the equation, leading them for them without their knowledge. Customers are asking to feel out of the feedback loop to choose their enterprises to be their partners: working with them to own experiences. create experiences, helping them reach their goals and giving them the option to change the experience when Two-thirds of consumers What’s more, discomfort with the results of customization companies get it wrong. For businesses, this is an exciting (66%) report they are just is only part of the issue. People are also growing concerned new opportunity. More than just creating a personalized as concerned about the about some of the methods businesses use to get there. touchpoint for their consumers, they can begin building Recent security breaches and increased scrutiny have long-term partnerships and fostering customer loyalty. commercial use of their contributed to mistrust in data gathering practices and But it means sharing control and power in the relationship. personal data and online deteriorating attitudes toward black-box personalization. It’s a new model—cooperative experiences—and it’s based identity for personalization In RSA Security’s Data Privacy & Security Survey for 2019, around customer agency. purposes as they are about security threats and hackers.
Giving customers agency—the ability to make was available for just six hours. People swiped relevant choices that inform their experiences— to make choices and advance the plot, and will turn passive audiences into active participants, could then display those choices on their profiles, increase engagement and let businesses sidestep which provided an opportunity to match with many of the hurdles that are holding back other participants. On top of delivering a new, their customization initiatives. It will transform engaging and non-invasive way to connect and experience delivery from one-way streets to start conversations, time-boxing the experience dynamic and responsive collaborations. encouraged people to use the app at the same time, with the intention to help conversations Consider how the dating app Tinder is and matches move faster. increasing engagement and helping people connect with potential dates by introducing customized experiences into its platform. Rather than collecting more information and heightening behind-the-scenes customization efforts, the Giving customers agency—the ability company released a choose-your-own-adventure series, called “Swipe Night,” that required to make relevant choices that inform 14,15,16 participation. Each five-minute episode was their experiences—will turn passive released at 6pm local time on a Sunday night and audiences into active participants.
Businesses are now at a pivotal point for their long-term strategy Cooperative experiences promise incredible value to companies Meanwhile, Uber is ramping up its effort to give riders more that can push them across customers’ everyday lives. But to do control over the in-car aspect of the Uber experience. In May so successfully, companies need to take on a new role—shifting 2019, the company added a “quiet preferred” option to its luxury the focus from simply making sales or providing entertainment, Uber Black and Uber SUV rides, allowing passengers to avoid 19 to how they can best utilize customer input, guidelines and unwanted small talk. Later in the year, the company expanded choices. They’re still providing experiences, but now customizing that strategy to more riders, launching Uber Comfort, a new those experiences effectively means understanding when option that features a slew of customer preference choices— to make the process seamless and invisible for customers, including quiet mode and temperature controls.20 and when to step back and give individuals control. The new imperative for enterprises is to reposition themselves from Companies like Tinder, Valve and Uber are not just gaining an administrator to an enabler and a guide. immediate value from their cooperative experiences, they’re setting themselves up for future success. As emerging For instance, Steam Labs, a section of video game developer technologies like 5G and augmented reality (AR) become Valve, is experimenting with a new kind of game recommendation widespread, their impact on experience delivery will make 17 system. The company’s interactive approach starts traditionally, balancing curation with customer agency even more critical. basing recommendations on customers’ playtime history, but AR will let businesses customize people’s visual environment, also incorporates how players feel in the moment. Customers moving experience delivery outside of screens and into the use sliders to help generate recommendations in line with their world. And as 5G networks roll out globally, they will enable current interests—like more indie games or newer releases. Just an explosion of new interactions and channels in the physical one month after launch, Valve said the recommender was so far world, making experience delivery possible nearly everywhere. performing very well, with people adding nearly 10,000 different 18 games to their wish lists from the Interactive Recommender page.
But as businesses’ reach grows, so does the risk of overstepping customers’ boundaries Consider how Huawei is using these technologies curated experiences, successfully doing so isn’t to change what people see as they navigate daily just a matter of deploying new technologies. life. Its “Cyberverse” technology integrates AR If enterprises jump on this opportunity without with physical reality, using spatial computing, rethinking their customization model, the chasm 3D and ultra-high definition maps, ultra-realistic between what they’re delivering and what immersive rendering and 5G to build AR map customers want will grow, and pushback will be overlays that people can view through their mobile fierce. If, instead, businesses shift their techniques— 21 devices. Apple is also exploring AR experience enabling cooperative experiences rather than black- customization through art by offering a series called box customization—the potential value is huge. [AR]T in cities around the world. The experience includes a walking tour to view professional AR The enterprises exploring cooperative art around the city, as well as an in-store session experiences today are launching a new generation to learn how to create AR art.22 of customization, fit for future capabilities and expectations. Those wanting to keep up, and The combined impact of AR and 5G will let stay competitive and relevant, will need to start businesses customize people’s experiences building reputations as companies that amplify throughout their lives, anywhere and anytime. customers through curated experiences, rather But with today’s growing wariness around overly than marginalizing them.
Become a true partner to your customers Although many of the technologies that will truly helping them create the large volumes of content revolutionize experience delivery—like AR and 5G— needed to offer customers more experience are still in early stages, there are others that can customization options. Turned external, they can help help businesses get started. For instance, many customers design and personalize apps or experiences are already investing in machine learning to build themselves.24 Amazon Sumerian lets people build their recommendation systems. These systems have own AR, virtual reality (VR) or 3D applications without traditionally left little room for customer input or any programming or 3D graphics expertise. Anyone to escape echo chambers; however, the technology with Sumerian can build immersive environments can be repurposed to enable customer agency. and experiences, like classrooms or building tours, THE.FIT, a menu personalization engine, uses artificial and can populate them with 3D objects and % intelligence (AI) to help restaurants collaborate with animated characters.25 85 85 customers to customize menus for their specific dietary restrictions, no matter how complex. Customers can Choose-your-own-adventure stories, customization with of executives agree scan a quick response (QR) code with their phones, live user input and tools that let people design their own choose all their dietary needs or preferences and experiences are all ways that businesses are embracing that to compete in receive a personally tailored mobile menu.23 cooperative experiences. It’s a major shift away from how a post-digital world, enterprises have operated in the past, but a necessary organizations need No-code development platforms—drag-and-drop one. While there is incredible value to be gained from interfaces that anyone, technical or not, can use to curated experiences, businesses will only access it if to elevate their create custom apps—can also be adapted to help they redesign their customization models to emphasize relationships with deliver cooperative experiences. These platforms personal agency. Becoming a true partner to customers can boost productivity within organizations, will be a defining aspect of enterprises’ future. customers as partners.
Big Takeaways Personalizing The need Setting up experiences for agency future success Providing immersive and meaningful As customers demand more ownership Emerging technologies like 5G and AR digital experiences is how leading over their digital experiences, enterprises have the potential to make experience businesses are connecting with their must find ways to provide individuals with customization ubiquitous across people’s customers. But as demand for customized more agency and make them co-creators lives. But that future will be unachievable experiences grows, people are becoming of their experiences. Those that do will find if people continue to feel out of the increasingly wary of the methods more active, engaged and loyal customers. loop. Leaders that explore new avenues enterprises use to provide it. to include customer agency today will be laying the foundation for long-term success.
Deep Dive Keep up with regulations by giving customers choice In today’s rapidly evolving data privacy landscape, leaders are using their new efforts in customer agency to help them remain compliant. The workplace communication tool, Slack, Regulation (GDPR), for example, companies has traditionally stored all customers’ data in based in the EU may only export data outside the US, but in 2019 announced it would add data of the European economic area if the receiving residency controls to its platform and let people country or organization maintains similar data choose where their data is stored. Slack adopted privacy standards. While Slack is GDPR-compliant this change in light of emerging privacy laws that today, data residency will help the company— would complicate its existing practice. Under and organizations that use the Slack software— the European Union’s General Data Protection stay that way, even if regulations change.26
This flexibility is increasingly critical Any company with global ambitions risks being of the state the right not only to access their data, and app activity to make its products more useful 31 overwhelmed as new regulations emerge around but also to control and delete it. And Brazil’s to individual customers, but customers can set the world. The implementation of GDPR alone privacy law, Lei Geral de Proteção de Dados time limits on how long that data can be used 33 sent businesses scrambling. After a two-year Pessoais (LGPD), is slated to go into effect in after it is generated. While it’s already possible delay in enforcement, more than 60 percent of August 2020. While similar to GDPR, the amount to delete data manually, the auto-delete settings companies said they still didn’t expect to be fully of time companies are given to respond to go a step further. Google is giving customers the 27 compliant by the May 2018 deadline. One year individuals’ requests will be shorter, and the option to manage their data on a constant and later, the EU had fined organizations around the definition of “personal information” is broader.32 rolling basis—increasing their agency, not just 28 world millions for non-compliance. A major airline over their data, but also in their relationship was issued a £183,000,000 fine over an incident Organizations can’t afford to be set back by each with the company. that compromised customer data; a hospital in the new regulation, especially at the speed these laws Netherlands was fined over lax controls regarding are going into effect. Like Slack, businesses will Businesses like Slack and Google are setting access to patient data; and a school in Sweden need to build flexibility and transparency into their themselves up to navigate a new reality— was fined after trialing a facial recognition system data collection and storage practices, prioritizing something every enterprise needs to do. Businesses 29,30 to take attendance. their ability to make changes quickly and easily. in every industry must tread a fine line between delivering the products, services and experiences And new data privacy laws are expected to make Google demonstrates another way that increasing their customers want versus non-compliance things even tougher. The California Consumer customer agency can help businesses balance with ever-changing regulation. Incorporating Privacy Act, effective January 2020 and regulation compliance with business goals. The customer agency will help organizations maintain enforceable in July 2020, will bring another wave company is offering customers auto-delete that balance, setting them on a new path toward of stricter regulations. The law gives residents controls: Google still uses location data and web regulation resilience.
Why Now? Consumer demand is moving in Customer preferences are shifting. The desire two clear directions: increased for customization continues to grow, and demand for experiences is beginning to desire for personalization and eclipse demand for things. demand for experiences. But Eventbrite’s research showed that the last 30 years have seen a as customers grow distrustful 70 percent increase in the share of consumer spending on live 34 experiences and events. Millennials continue to drive this forward, of the techniques used to as 72 percent said they would like to increase their spending on provide these experiences, experiences rather than physical things in the next year. businesses are hurtling Demand for personalization is high. In a survey by Adobe, 67 percent toward a breaking point. of consumers said it’s important for companies to customize content automatically based on a person’s current context. What’s more, 42 percent said that unpersonalized content annoys them.35
Public sentiment around customization Rapidly maturing technologies are expanding hinges on agency and trust. businesses’ experience customization capabilities, making the balance between customization and People feel a lack of agency over their experiences, and they’re holding consumer choice increasingly critical. companies responsible. In a McAfee survey, 43 percent of respondents felt they lacked control over their personal data, and 33 percent weren’t Immersive technologies like AR and VR are already being adopted by 36 sure if they could control how companies collect it. consumers today. An eMarketer report estimated that 68.7 million people in the US used AR at least monthly in 2019. By 2021, the report forecasts 40 When an individual lacks agency, personalization can feel like an that number will go up to 85 million. overstep. In a 2019 survey, 77 percent of consumers said that they 37 were uncomfortable when they noticed targeted online ads. And Enterprise spending on extended reality (XR) also shows no signs of a global survey from RSA Security found that just 17 percent of slowing down. According to IDC, worldwide spending on AR and VR respondents thought personalized ads were ethical.38 is expected to pass $18 billion in 2020—a 78.5% increase over 2019— and will reach $160 billion by 2023.41,42 Increasing distrust and discomfort affects consumer behavior, which negatively impacts business. In an Accenture survey, 58 percent of 5G networks are expected to enable faster and more interconnected consumers said they would switch half or more of their spending networks of people and devices, and the opportunities are growing to a provider that excels at personalizing experiences without quickly. The 5G infrastructure market is expected to rise at a compound compromising trust.39 annual growth rate (CAGR) of 76 percent between 2018-2026, according to Fortune Business Insights.43
Survey Stories Striking a balance with personalization 70% 66% of consumers of consumers By Generation agree: agree: 77% I am concerned about I am just as concerned Baby Boomers and Prior 72% data privacy and about the commercial 69% commercial tracking use of my personal data Gen X 67% associated with my and online identity for 65% online activities, personalization purposes Gen Y/Millennial 60% behaviors, location as I am about security 67% and interests. threats and hackers. Gen Z 60% Concerned about data privacy and commercial tracking Concerned about the commercial use of my personal data N=2,000 Global Consumers
Personalization is undeniably becoming a key Beyond data privacy alone, there is emerging As enterprises look to deliver personalized differentiator for enterprises across industries. concern that personalization efforts are trapping experiences in sync with the nuanced expectations Accenture’s Technology Vision 2020 survey finds people in bubbles—both group and individual of customers, new roles are emerging. Fifty-seven that 90 percent of businesses believe delivering echo chambers. Nearly half of consumers believe percent identify as a “guide” and 45 percent as a highly personalized services is a top strategic personalization has a major risk of cutting off “coach,” indicating their ambition to push people priority. Within the retail sector alone, 96 percent people from new ideas and experiences. These outside of their comfort zones. Meanwhile 39 of consumer electronics executives, 97 percent concerns will only grow as enterprises continue percent of companies identify as “order-takers,” of health & beauty executives and 92 percent along the same path of personalization without demonstrating a more conservative approach of travel industry executives all report a strong assuming additional responsibility and empathy to experience customization. What might your focus on personalization. with their customers. enterprise’s role be in the future, and what are the implications and responsibility of that role? But while customers may be hungry for the benefits of personalization, they are starting to weigh them against the risks of data privacy and security. Sixty-six percent of consumer respondents are just as concerned about the As enterprises look to deliver commercial use of their personal data and online personalized experiences in sync identity for personalization purposes as they are about security threats and hackers. Seventy with the nuanced expectations of percent of consumer respondents are concerned customers, new roles are emerging. about data privacy and commercial tracking associated with their online activity, behavior, location, and interests.
Deep Dive As enterprises begin to build cooperative experiences, where customer choice is abundant and expected, they don’t have to start from scratch. Companies from every industry can apply the same technologies already used How Epic Games by leaders in the video game industry. Games have always relied on active participation to drive an experience. Early digital games had a starting point for is building a a player and a finite set of endings, but the player chose how to get there. Modern gaming companies are moving into multiplayer open-ended experiences like Minecraft and Fortnite, where players build and create with one another. platform for Games take the shape of an ongoing, ever-changing collaboration, and every session played is a unique, cooperative real-time social experience. Epic Games’ Fortnite is using Amazon Web Services’ (AWS) cloud services to support experiences like these at an unprecedented scale. With more than 200 million experiences players around the world, Fortnite is one of the world’s most popular video games, and the experience is full of choices.44
Games with 100 concurrent players take With customers all having different experiences, to enjoy the game and abandoning it altogether place across a dynamic map with ever-evolving it’s critical for enterprises to bake in the capability as their frustrations grew. By introducing AI features, where people can tailor their avatar’s to understand the quality of those experiences. companions of variable skill, the company gave appearance and clothes. The game also hosts Epic’s robust analytics practice shows how to look new players a chance to learn, explore, train multiple different experiences, including one where beyond just what the experience is today, to how and ultimately fall in love with the experience.47 a player competes with other players, another to transform constantly and improve over time. where players explore alongside their friends, and The company’s analytics pipeline streams The path laid by gaming companies like Epic is a version where the individual has command of the gigabytes of data to the cloud, leveraging tools not industry specific. Non-gaming enterprises are entire environment to create and construct maps. like Amazon Kinesis, Apache Spark and Tableau to already starting to take the lessons learned, and the capture (and make sense of) up to 40 GB of game technology built, to drive new value for customers. Fortnite is able to support these experiences data every minute. This data feeds into Epic’s multi- The architecture firm HOK uses Epic’s Unreal via Epic’s strong technology base: the game terabyte databases, which developers can use to Engine, a gaming engine to showcase interactive was built through Epic’s Unreal gaming engine understand key insights like customer satisfaction, designs to clients. The company uses the dynamic 46 and a wide variety of Amazon’s cloud services, behaviors and engagement. environment to give clients a more immersive look ultimately supporting a more than 100-fold growth at proposals, aggregating content from multiple 45 of players in just one year. Enterprises looking Finally, companies will have to strategically sources to introduce elements that make the 48 to co-create experiences at scale will need the on-board customers into these new experiences. world feel more real. Finnish airline Finnair has elasticity and scalability benefits cloud provides With such a wide range of possibilities, people can also used the Unreal Engine to build a digital twin 49 to allow for massive spikes of concurrent be at a loss for where to get started. Epic is using of the Helsinki Airport. The company used this customers. With its unique architecture, Epic AI to deliver sophisticated and tailored guidance precise rendering to build VR experiences, such can scale seamlessly to support, at times, to its customers. An October 2019 update to as situational awareness training for ground crews, more than eight million unique users. Fortnite included the introduction of AI-controlled and to familiarize airplane staff with cabin layouts bots to the game. The company discovered that and key functions. new players were being eliminated too quickly
As enterprises move to co-creating experiences with customers, they will be introduced to a new set of technology challenges. But forward-thinking leaders are already seeking out unexpected partnerships, like those in the gaming industry, and finding new ways to craft and guide their customers through dynamic, personalized experiences.
Decision Points To what extent does your business Does your current method for How is your company preparing understand consumers’ trust designing experiences lend for data regulation that impacts (perceived or lack thereof) in itself to sharing control of customer experiences? your business? experience design? P repare the enterprise to address an increasingly Consider the risks and benefits associated with the Find points within your customer journeys regulated digital landscape. Review your current business growing its personalization strategy, and where individuals may want more control data collection and management practices to the methods used to generate those experiences. over their experiences. These points are identify potential points of risk. opportunities to give people using your Seek out opportunities to generate more customer digital products and services the agency E nsure that your policies for consumer management feedback. Build a holistic understanding of how that will drive long-term partnerships. of data are fully documented and made available to individuals experience your digital products or consumers and regulators. services today. Use these insights to inform your Identify and invest in the technologies that approach to designing future interactions. will enable your next wave of cooperative R evise your data collection and storage strategies experiences. Scalability, immersion and to support cooperative experiences while complying participation will be key to sharing control and with regulation that requires consumer privacy. co-creating unique customer engagements.
I make the experience I make the experience I make the experience
Bold Predictions 5 5 10 In five years In five years In ten years The line between media At least one country will All customer interactions entertainment and gaming pass legislation to regulate will be multisensory, companies will blur as real-time interactive advertising including haptics, vision, interactive experiences become in the physical world. gestures or sound to drive a primary form of leisure. cooperative experiences.
Trend 2: AI and Me Reimagine the business through human and AI collaboration
Take a new approach that uses artificial intelligence to bring out the full power of people. Move beyond deploying AI for automation alone and push into the new frontier of co-creation between people and machines.
Don’t just automate, collaborate The Volkswagen Microbus is the definition of an The VW and Autodesk collaboration ultimately iconic design. Just saying “VW Bus” conjures a created parts for the Microbus that were lighter and mental image of the 1960s mainstay; even people stronger than any prior designs. The AI, for example, who haven’t seen one in person can immediately inspired a tree-like design concept for the wheels picture it. So, when VW decided to reconceptualize that made them 18 percent lighter than a standard the 1962 Microbus, the company wanted to stay true set. The generative approach also allowed VW to to the vehicle’s historic design—but update it to be reduce the time spent getting from development lighter and greener in line with today’s standards. to manufacturing—a 1.5-year cycle was reduced to just a few months. Those metrics were big wins. To solve this problem, VW partnered with But what was more important was how VW got there. engineering software services leader Autodesk The designers credited generative design and their 1 to experiment with generative design tools. AI collaboration with creating structures they could Generative design enables iterative collaboration never have created on their own.2 between human engineers and artificial intelligence: humans provide design goals and constraints to an AI system, which outputs a wide range of feasible—though sometimes unexpected—solutions. From there, the parties continue to iterate, with the machine generating ideas and human co-workers curating and refining them.
This and similar experiments from across industries But AI can’t reinvent the business on its own. To tap into the reveal a stunning reality: businesses today are realizing unique strengths of the technology, businesses will rely on only a fraction of their AI potential. Leaders got to a people’s ability to steward, direct and refine AI. Enterprises point of advantage by plugging AI and other tech tools will need to engineer the opportunity for human employees into existing workflows, focusing on automation and to couple their unique talents and knowledge with the execution. But simply using AI to make their organizations limitless capacity of machines to explore new possibilities. run faster and cheaper limits its impact. Now, leaders are Those that do so successfully will build the next generation leveraging the potential of AI systems to transform not just of intelligent businesses—where humans and AI systems how businesses do work, but also what they actually do. work together to reimagine what’s possible. AI is becoming an agent of change across the organization. % This trend isn’t limited to generative design. Leaders 73 To capitalize on this, businesses need to reimagine are beginning to recognize the tremendous potential 73 AI’s role in the organization. Artificial intelligence offers of enabling humans and machines to inspire one another. one of the key advantages that have let startups disrupt Take OpenAI’s MuseNet, an AI that collaborates with humans of organizations decades-old incumbents: the technology doesn’t to compose music, without people needing expertise in report piloting approach a problem based on years of experience composition or technology. A human provides a starting or adopting AI or inherent human biases. It hasn’t yet learned what sample, a target style and instrument preferences. MuseNet not to try. uses what it’s learned from hundreds of thousands of in one or more musical files to make suggestions about the next segment business units. 3 of a composition. The process repeats until a novel piece of music is created, the result of a true collaboration and division of labor between human and machine.
Untethering creativity and catalyzing change begin at the individual level of human-machine interaction To start reimagining the organization, enterprises need Meaningful collaboration always begins with to facilitate and enable true human-AI collaboration. communication, yet historically machines have They must think beyond a linear “command and response” struggled to understand the most common form relationship and engineer an interactive, exploratory and of human communication: language. This is no surprise; adaptable experience. machines typically are precise in their actions and operation, while language is anything but. Between slang, This requires an innovative set of capabilities that most regional variations in dialect and single words that have enterprises aren’t actively building today. Automation multiple meanings, the challenges of language have required designing the skills to get a job done, but defied straightforward communication with machines. collaboration demands the ability to communicate and iterate with partners. To foster human and AI collaboration, businesses will need to explore and master the tools and advancements that enable humans and machines to better To start reimagining the organization, engage each other. Natural language processing (NLP), explainable AI and extended reality (XR) will all unlock enterprises need to facilitate and new ways for humans to interact with machines and for machines to interact with us. enable true human-AI collaboration.
Now, these challenges are disappearing for both Businesses are already seeing the benefits of written and spoken text through advancements in increasing NLP sophistication. Casetext, a startup NLP. By leveraging these advances, businesses can building an AI-powered research platform for deepen human-AI collaboration. Google’s BERT lawyers—named CARA—has applied techniques and Baidu’s ERNIE—which are both open-source similar to the BERT approach. In doing so, the frameworks—enabled AI systems to move from company improved its citator filtering algorithm understanding just one word, to understanding to better curate the passages sent on from the AI 4,5 phrases in context. The same way humans learn for human review. This helps lawyers build their reading comprehension in school, NLP systems cases by providing more relevant and actionable can now understand that there’s a difference information. The collaborative approach has cut between “Joe is running at the gym,” “the car the percentage of potentially overruling passages engine is running” or “Maria‘s nose is running.” that human co-workers need to read in new 6,7 This semantic understanding improves a machine’s cases down to three percent. ability to understand a human’s intent, letting them better inform outcomes without requiring constant direction.
Language is just one element that machines will need And collaboration can’t just be one-way; companies to understand to better collaborate. For many employees, must complete the feedback loop and build the capabilities these technologies are most valuable when they can that allow humans to better understand machines. True understand the physical context of humans. Companies iteration will require understanding the decision-making 23% must ensure the tech can sense—and make sense of process of an AI system, so that people can correct or —a person’s surroundings to enhance human-machine fine-tune it as needed. The growing field of explainable collaboration. Image recognition and machine learning AI is letting humans de-mystify the output of previously allow Microsoft’s HoloLens 2 mixed reality headset to “black-box” AI systems—making human-machine not only see, but also understand the wearer’s physical collaboration possible even if the AI wasn’t designed 8 environment. While previous XR devices might only know to explain its decision-making process, through that something exists in the field of vision, the HoloLens approaches like counterfactual explanations. 2 identifies an object and understands what that object Only 23% of organizations is: for instance, a couch is not just a series of pixels, but report they are preparing their something that can be sat on and belongs in a living workforce for collaborative, room. This contextual understanding of the environment interactive, and explainable unlocks new capabilities for the device, like being able AI-based systems. to identify dangerous equipment and warn the wearer if the equipment is operating hazardously.9
AI reimagined Work at Accenture Labs demonstrates this using Natarajan was declared the winner, but noted every workflow. Particularly, the company’s claims data from loan applications. If an applicant is the system’s potential, saying that if its ability payment process was designed to play to the 13 denied a loan, the system explains the reasons to grasp and contextualize information were strength of AI and humans working together. for the denial and offers the smallest number of paired with a human colleague’s skills in using Customers file claims with a chatbot that both changes the applicant would need to make to that information more subtly, it would make logs the claim details and instantly compares the 12 have the application approved, such as having for a powerful collaboration. claim to others within the Lemonade database— 10 more cash on hand or increasing annual income. a first wave of defense against fraud. If everything The process is also interactive: if an applicant Once enterprises enable the full scope of is okay, the claim can be paid out immediately can’t increase income, for example, they can human-AI collaboration, they can jump on the to the customer. If a claim is too complex or ask the system to make another suggestion that new opportunity before them—employing AI problematic, the AI shares the information with a 14 would lead to a successful approval. Making as an agent of change. Competitive advantage human agent, who steps in to manage the case. AI explainable turns a human-AI interaction is no longer about finding a faster way to do into a relationship. what’s already being done. Leaders in the future This unique division of labor is the root of will be the ones that can rapidly and continuously why Lemonade can offer competitive pricing IBM built a system that put many of these change, using AI to rethink and reimagine within the insurance industry. Fraud and the new capabilities into action. “Project Debater” everything—from the way their organizations administrative costs of complex bureaucracies combines IBM Watson’s natural language are structured, to the way they approach work, are two of the largest costs to insurance capabilities to listen to and parse human speech, to the value their enterprise creates. companies, and the company solves both by with a system that mines through an array of making AI a key part of the process. Meanwhile, newspaper and journal opinions to construct Look at Lemonade, a startup natively designed it also provides the customer with a simplified, an argument. In 2019, the company pitted the to use human-AI collaboration to disrupt the seamless insurance experience while making system against European Debate Champion insurance industry. At Lemonade, AI is embedded a human touchpoint available when it’s 11 15 Harish Natarajan in a live, unscripted debate. in the organization and present in nearly needed most.
Ultimately, the problem every company is Going forward, companies will be limited only by trying to solve comes down to delivering the what they can imagine, but they will be expected experience and outcomes that customers want. to grow and change more rapidly than ever. By Today, an airline customer service chatbot may consciously structuring their organizations with be able to answer the question, “Can I bring my human and machine collaboration at the crutches on board?” with a simple yes or no, and core, pioneers are already positioning AI to be perhaps provide a link to the airline or regulatory a driver of that change. The next generation of authority’s policy about carry-on items. But there’s intelligent enterprises will be led by those that an opportunity to extrapolate far beyond the are not just open to new ideas, but collaboratively simple language of the inquiry. building them. An intelligent agent could recognize that the question about crutches may mean the traveler has a mobility issue. It could then pull up the person’s itinerary, note that a plane change would require a transfer between terminals, and ask if a The next generation of wheelchair or cart transit would be helpful. An AI intelligent enterprises system could even suggest an alternate itinerary that would mean less distance to walk. Quickly will be led by those that answering a customer’s narrow question is one are not just open to new type of problem; however, delivering on the entire range of outcomes a customer might desire is a ideas, but collaboratively much more valuable one to address—and one that businesses can start solving today. building them.
Big Takeaways Collaborate, don’t Context Reimagine just automate matters what you do Enterprises are only realizing a fraction To collaborate successfully, humans Businesses that facilitate human-machine of the potential of AI—and ultimately their and machines need to better understand collaboration today will be able to reimagine employees. By finding more collaborative one another. Advances in natural language every aspect of their organization, from the use cases and building the capabilities processing (NLP) and computer vision way they design products, to the way they needed for AI and people to work together can help machines understand people hire and train employees. True pioneers will seamlessly, they will amplify the best and their surroundings. And prioritizing use these capabilities to reinvent the entire qualities of both. explainability will help organizations business from the ground up—tackling ensure that people understand AI. bigger challenges and building the next generation of the intelligent enterprise.
Deep Dive A new way to learn When the workforce at Red Nucleus started asking for leadership training, the learning solutions company enlisted the services of an executive coach. But this was no ordinary coach. The company brought in Coach Amanda, an AI-powered virtual assistant for management training developed by LEADx, 16 a leader in conversational learning and leadership enablement. While traditional executive coaching for advice concerning employee is expensive and typically granted problems, suggestions to increase to very few employees, deploying employee engagement or lessons on a collaborative system like Coach management fundamentals. The results Amanda can give far more employees are impressive: The company saw a access to an ongoing learning 33 percent increase in productivity, experience. Red Nucleus employees a 35 percent decrease in workplace could talk to Coach Amanda at any stress and a nine percent increase 17 time in natural language, asking in managerial confidence.
Transform the business inside and out Advances in AI are letting organizations build is merely reading off of the slides and provide offer live insights about how a customer is feeling interactive, adaptable and intelligent systems feedback on how often filler words (“um” and “ah”) and provide guidance to the call agent on how that collaborate with human employees to help are used or insensitive phrases like “best man for to improve the experience. This collaboration them reach their goals. While this collaboration the job.” Microsoft’s presentation coach isn’t just between human employees and AI not only offers is valuable across the organization, businesses an automated system; it collaborates with individual the call agents real-time coaching, but also helps are finding it’s especially transformative for their employees, using live feedback to help them learn identify future coaching opportunities for them. learning and training initiatives. Far more than just and improve their speaking. What’s more, every streamlining existing methods, collaborative AI employee with PowerPoint can use it. Sophisticated systems that interact and collaborate coaching has the potential to democratize and with humans are becoming an integral part of the expand HR programming, while creating entirely Human-AI collaboration is also creating training work environment, generating ideas and solutions new strategies for employee development. opportunities that didn’t exist before. Cogito, a just like their human counterparts. It’s a new kind behavioral science software company, is using of partnership that impacts every level of the Collaborative AI training can provide learning voice-to-text and sentiment analysis to coach business, and leaders will see that opportunities opportunities at unprecedented scale. Microsoft human call center agents in empathy during their for collaborative AI are both external and internal. 19 recently launched an AI-powered presentation phone calls with customers. When a customer AI training is just the start. In the future, collaboration 18 coach for its web version of PowerPoint. The calls with a question, Cogito lets the agents know in between humans and AI will transform the business tool assists presenters with pace, slide reading real time if they are speaking too fast or interrupting inside and out. and wording. It can track how quickly or slowly the customer. The AI-driven tech can also recognize someone is speaking, detect when a person the emotion and inflection in people’s voices,
Why Now? Enterprises are moving Businesses are increasingly leveraging AI, and beyond automation alone it’s quickly becoming a strategic imperative. and beginning to reimagine The market for AI is expected to grow to $14.7 billion by 2025, how they use AI. Bringing up 154 percent from 2018.20 together the creativity and The adoption of enterprise voice assistants and virtual digital critical thinking skills of assistants is expected to grow rapidly to one billion users by 2025.21 humans with the scalability Two-thirds of enterprise leaders are expecting to deploy AI in the next year with successful implementations projected to boost of AI is opening up new revenues up to 30 percent.22 frontiers for the enterprise. Eighty-four percent of executives believe they must leverage 23 AI to achieve growth objectives. Companies that have adopted AI and are strategically scaling it report 3x growth on the return of their AI investments.
As enterprise use of AI grows, so are With these new capabilities, AI is making the capabilities of intelligent systems. a larger impact across companies. On a 2019 benchmark test, a best-in-class NLP model scored In a 2019 survey, 62 percent of US consumers said they liked 28 near the human baseline level of language processing tasks like using chatbots to engage with businesses. Now, 80 percent semantics, argument structure and logic. A new benchmark had of businesses are expected to have some sort of chatbot to be introduced to keep up with the unexpected pace of the automation by 2020.29 technology’s progress.24 Companies are exploring the future role that AI will play in talent Google developed a speech recognition model to be hosted acquisition, with 36 percent saying they expect the usage of AI on-device for its smartphones. The model transcribes speech in recruitment to be high or very high in two years.30 almost instantly on a character-by-character basis and is compressed 25 to only 80 megabytes. Advances in NLP have improved translation AI is starting to reshape industries as well. In the pharmaceutical offerings, too: Waverly Lab’s “Pilot” headphones can translate sector, revenue from AI-generated solutions is expected to grow 31 15 languages during a real-time conversation, and the company to $2.19 billion by 2022. The market for generative design is sold 35,000 devices in less than a year.26 expected to grow at a 16 percent compound annual growth rate 32 (CAGR), reaching $124.58 million by 2023. AI is even taking over These intuitive advances are driving big business. IHS Markit Wall Street, where algorithmic trading is accounting for a growing predicts that the global smart home market, which reached percent of total trade volume.33 $41 billion in 2018, will grow to $192 billion in 2023.27
Deep Dive Maximizing the impact and value of AI means How Adobe looking beyond automating a given task to how human-AI collaboration can improve outcomes. is building But unlocking this potential requires more than building or buying a tool. It means reengineering the enterprise and the workflows AI systems are an intelligent designed to support. Adobe is completely transforming its suite of products with Adobe Sensei, an AI layer infused 34 experience across the company’s various cloud tools. Using backend machine learning models, data streaming pipelines, microservices and more, Adobe’s entire architecture is designed to allow Sensei to provide rich, intelligent collaborations as people use Adobe’s products.
Expand human capabilities Adobe has leveraged advances in NLP to the system observes the person repeating. platforms, then used to provide automated enable voice search with Sensei: customers But Sensei learns from more than just the personalization of offers, analyze digital can interactively search Adobe’s large individual. The Adobe creative community channel traffic and behavior and suggest repository of images and videos by speaking is continuously sharing new layouts for improvements for customers. This to Sensei, further direct and refine results and creative campaigns. Sensei learns from collaborative, AI-driven approach enables even ask the application to move a selected these layouts and pairs that knowledge with the use of intelligent cloud products inside 35 image into Photoshop for final editing. design and communication best practices to of existing workflows, while simultaneously While the voice search itself makes for a assist customers throughout their campaign improving a campaign manager’s ability 37 more natural interaction with the software, design process. With Sensei’s capabilities, to react to the fast pace of customer it’s also making the move from one stage Adobe Spark can collaboratively navigate a needs today. of the workflow to the next a more person through hundreds of layout options, seamless experience. iterate based on the individual’s decisions AI holds immense potential to transform and recommend alternative layouts, allowing how enterprises bring value to their customers, Sensei’s systems are also continuously people to draft a creative content campaign but businesses will never reach that potential learning. The system is designed to capture in a matter of minutes. if they don’t rethink where and how they user interaction data across the entire range apply the technology. Leaders must focus on of cloud products and use this information to Sensei’s capabilities also help support building the capabilities for AI to interact with 36 understand the person’s intent and context. customer relationships after a campaign people in a collaborative, understandable way It also applies this understanding to augment is launched. Data related to customers that expands, not replaces, human capabilities. the workflow, such as streamlining tasks is gathered from across channels and
Forcing people to navigate between discrete tools, devise workarounds for complicated workflows and figure out how to use data produced by intelligent systems will be a thing of the past. The future is in AI-driven systems that put people at the center, while being context aware, seamless and adaptable.
Decision Points Is your company thinking How will you roll out collaborative AI How will you address explainability? collaboratively? initiatives across the organization? Evaluate the scope of decision-making that AI is Determine the role that AI is playing in your Evaluate where your industry is headed. being given in your organization. Identify sensitive business alongside your existing workforce. Where are partners or competitors finding areas where additional oversight may be needed Think beyond which tasks could be replaced success in deploying AI? and prioritize post-implementation explainability and imagine how you can build a new kind solutions, such as counterfactual explanations, of workforce with humans and AI collaborating To ensure transparency and trust, gather for those systems. side by side. workforce perspectives into the design and implementation of AI systems. Ultimately, these For all future AI projects, plan for explainability Determine what tools are available internally employees will be the ones who determine the by design. Develop policies and principles that to introduce the AI solutions needed to move success of your AI investments. will guide the development, building and your organization in this direction. If none are implementation of new AI systems. available, evaluate if employees have the skills If you’re not already using AI in the company, to build the solutions, or engage partners find an area to begin piloting the technology, to generate the necessary capabilities. such as co-designing a new product, coaching or training employees or reinventing customer engagement strategies.
Tap into the AI genius
#TECHVISION2020 Bold Predictions 3 5 7 In three years In five years In seven years Seventy-five percent of Global Every operational AI The majority of people’s 2000 companies will offer deployment will be legally interactions with intelligent employees the opportunity required to have an systems will happen in natural to work with AI-powered explainable component. language and spatial interfaces. career coaches that make personalized growth and training recommendations. 63
Trend 3: The Dilemma of Smart Things Overcome the “beta burden”
Address the new reality of product ownership in the era of “forever beta.” Transform pain points into an opportunity to create an unprecedented level of business-customer partnership.
When customers buy products today, do they completely own them? In early 2019, the Jibo home robot surprised its owners devices with Google, losing their apps and automated with bad news: its control servers were shutting down. routines until the new setup was in place. Following While people could still get the $899 robot’s attention pushback, the company announced that existing Works by saying, “Hey, Jibo,” it would no longer understand with Nest connections would stay online.3 1 or respond to any other voice commands. Jibo isn’t the only device to change functionality Around the same time, in an effort to create a more on customers, and Google won’t be the last company unified and secure experience for its smart home to shake up its ecosystem. Enterprises are beginning ecosystem, Google announced that it would be shutting to design updateable products with the ability to expand down the “Works with Nest” program in favor of the services and experiences in the future, making it possible “Works with Google Assistant” solution. Works with to respond to changing customer demands and Nest had allowed developers to connect Nest products expectations at a moment’s notice. This sets the stage like smart thermostats and doorbells with third-party for feedback loops that support true partnerships, smart devices to create experiences: turning lights on where customers can see the value and utility of when the sun sets or cooling down the kitchen when products grow over time rather than fade. 2 the oven is on. Migrating to Works with Google Assistant meant customers would need to re-register all of their
However, as companies introduce this state of “forever Enterprises across all industries are already making big beta,” they are challenging traditional perspectives on bets on a connected future. The internet of things (IoT) ownership. As Jibo and Google demonstrated, products market is expected to grow to 75.44 billion connected that consumers think of as “theirs” are being redefined devices by 2025, with a projected market value of 4,5 at the drop of a code release. Without proper care, this $1.1 trillion by 2026. For businesses that want to living connection can quickly drift from a wellspring of build a competitive position in this emerging market, opportunity, to products that feel completely beyond the addressing the beta burden will hold the key: those control of the people using them. The risk is customers that ignore it will face attrition as mounting frustration constantly having to play catch-up, not knowing if the leads customers to reject their biggest innovations. next system update is bringing exciting new capabilities, a critical security refresh, a new user interface to learn or a dramatic change to functionality. It’s not surprising that customers are growing weary of what’s around the corner. Call it the beta burden: the unintended consequences Call it the beta burden: the when products, and their contained experiences, are unintended consequences constantly in flux. when products, and their contained experiences, are constantly in flux.
The question of ownership and the challenges In these cases and others, the evolving digital experience of the beta burden are two sides of the same coin. is designed to be an intrinsic part of the usefulness and It might sound strange to claim that ownership of differentiation of a product. That’s possible because the products is now being shared, but consider the wave enterprise can take control of a product to improve or of connected products emerging across industries. expand the experience after a person has purchased it. Caterpillar’s new generation of industrial equipment But this is a huge departure from the past, where what is being integrated with Cat Connect, a platform that you bought is what you got. Today, customers may own allows the company to continuously explore and introduce the physical piece, but the business administers the digital new telematics-driven services to customers such as side—effectively retaining ownership over part of what remote troubleshooting, performance optimization and makes the product valuable. 6,7 more. Likewise, Samsung is continuously expanding the capabilities of common items like TVs and refrigerators by integrating connected products from disparate companies with its SmartThings app. And Tesla customers have seen their cars transform without ever visiting a mechanic as new functions like autonomous driving, accommodations for pets and enhanced safety features are pushed through firmware updates.8,9
These new realities of ownership are catalyzing deep change within the enterprise This is allowing companies to reinvent themselves as opened the door for robust and ever-transforming collaborators with their customers. But companies ecosystems. But as adoption of this new generation are experiencing the beta burden because the of products continues to grow, the impact is being % strategies and operating models that support their felt far beyond the technology organization alone. products are misaligned with this new role. To deliver 7979 the wide-ranging experiences they hope to achieve Companies must expand the approach that through flexible, updateable products, companies began in the engineering space to permeate of executives believe must rethink the way the entire organization every aspect of their organization, whether it’s their industry is moving develops, delivers and supports its outputs. sales, customer support, development, design toward offering more or others. If leaders ignore this imperative, Evolutions in the engineering space started even the most successfully delivered product variety in ownership businesses down this path. Agile and DevOps or service will look like a failure when the models for their processes allowed the organization to move businesses can’t keep up with its evolution. connected products and respond to the demands of customers, while application programming interfaces (APIs) and/or services.
11 Consider how enterprises now have a deeper stake affected phones. Apple demonstrated what will soon in the long-term lifecycle of a product and must build become a basic function for companies from all industries: the capabilities to support that. Apple recognized early the need to support longer lifecycles and manage both on that the paradigm of product ownership was changing, the digital and physical lives of their devices. To do so and that they would need to be more deeply involved effectively, they’ll need to develop a strategy for continued with a product’s lifecycle. For instance, the company clear communication and transparency with people. knew that iPhone owners would always want the latest and greatest software experiences, but also knew that older devices could struggle to support their newest innovations. Rather than risking overloaded batteries and disabled devices, the company proactively pushed an update designed to extend the lives of the iPhones 10 by managing performance. Without knowing why the Consider how enterprises now company had taken this action, however, some customers have a deeper stake in the long-term were surprised by the sudden change in performance in devices they felt were “theirs.” As part of its commitment lifecycle of a product and must build to its customers, Apple took it one step further: it also the capabilities to support that. began offering subsidized battery replacements for
New models for the future As more enterprises from all industries integrate Signify, the new company name of Philips Lighting, digital technology into products, they will increasingly took an innovative approach to keeping the latest have to contend with the “digital deaths” of those and greatest technology in its customers hands products. Look at smart appliances: a refrigerator by introducing Signify Circular lighting. It’s an might last 20 years, but add a touchscreen to the enterprise solution where Signify offers lighting door and some digital capabilities, and that life based on the uptime and energy needs provided 12 expectancy could drop fast. The fridge might still by its customers. The company maintains the keep food cold, but the smart capabilities won’t materials, lightbulbs and sensors required to deliver be very useful if the screen gets too old to function. the experience, swapping out older pieces for new Not only will old devices limit the business in its in order to deliver a consistent experience. This also ability to deliver the most cutting-edge experience, allows Signify to reuse, refurbish and recycle as they will begin to generate risk for the whole much as possible, helping both the company and ecosystem as aging technology is often rife with their clients to meet sustainability goals with better security vulnerabilities. Building a strategy to smoothly energy efficiency and reduced digital waste. transition customers from one generation of product to the next will be a key component of customer Signify is essentially providing lighting-as-a-service, retention and loyalty in the future. de-emphasizing the individual device and focusing on providing the best experience. Leaders like Signify realize that addressing the beta burden isn’t just about alleviating consumers’ burdens around smart products. It’s about finding opportunity in a new business model.
Shiseido, a large Japanese beauty brand, is giving Under today’s new models of ownership, products one of its latest innovations away for free. The are more than just the object in someone’s hands. company wanted to bring a personalized skincare As Philips and Shiseido are demonstrating, they can experience to its customers and developed Optune, be a channel for companies to deliver extraordinary a platform that creates uniquely tailored lotions for experiences and value to customers. Thinking of customers. People take pictures of their skin and the product as the end-all, be-all for the customer upload them to the Optune app, which uses AI to relationship exacerbates the beta burden and puts analyze the photos and incorporate external data a hard limit on the company’s potential for future 13 such as weather, humidity, environment and more. growth. But the beta burden doesn’t have to stay The app then creates a customized “recipe”— a burden—for customers or businesses. Shiseido has identified more than 80,000 so far— and sends it to a connected device, which mixes Enterprises transitioning to experience-driven 14 and dispenses the lotion. But rather than burdening products are doing so because they see the potential customers with an expensive up-front device of continuous interactions with their customers. cost, the company is maximizing adoption by Reimagining the organization to support these only charging a monthly subscription for lotion products’ new lifecycle is how leaders will bring 15 refills and access to the platform. that potential to life.
Big Takeaways Understanding the Ownership is Designing for “beta burden” changing the journey As products become conduits for Experience-driven and updatable Enterprises have to design products experiences, their features and products are introducing a new model to evolve and transform over time, functionality are constantly in flux. of ownership—one where businesses must while simultaneously becoming more While this state of “forever beta” retain some control and responsibility over comfortable releasing products they opens up a wellspring of opportunity, a device, even after a customer purchases might conventionally see as “unfinished.” if mishandled it risks leaving people it. This shift has implications for the whole Products will gain value from the overwhelmed, frustrated and wary organization, and businesses must ensure ecosystem of experiences that form of what’s around the corner. their strategies and operating models are around them, if properly fostered aligned with this new reality. and guided by the enterprise.
Deep Dive Designing “unfinished” products Just as the advent of cloud computing upended the notion of a software “update,” leading businesses today recognize that IoT maturation means revisiting the idea of a “finished” product. Rather than striving for perfection before release, they are deliberately shipping unfinished products—and building potential for growth into their designs. Consider how Sony is using sensor-rich hardware to extend device value in new and exciting ways. The company’s robotic dog, Aibo, exists as a standalone device that consumers can purchase, but Sony has also introduced a cloud service that lets the robot companion remember subscribers’ faces, environments and 16 interactions. This lets Aibo evolve over time, becoming a unique product for each person. Sony’s design also lets the company create future value for owners by rolling out new tricks. The device’s connectivity and advanced hardware—including cameras, motion sensors and light sensors—all provide rich opportunity for developers to change the Aibo experience over time.
Maximize the value Companies like Sony are preparing for a future General Motors (GM) is also adopting the acquired MultiMechanics, Inc., which develops where they are expected to enhance device unfinished product mindset, and it has created finite element software to help companies functionality long after a consumer makes the a “digital nervous system” platform for new predict failure in advanced materials. Siemens 18 initial purchase—and they’re doing so in a way GM cars. This system will be able to process plans to integrate the company into Siemens that guards against the beta burden. Leaders are 4.5 terabytes of data an hour—a fivefold increase Digital Industries Software, making it possible rethinking their design processes and hardware over what current GM cars can do—which will let for its customers to create digital twins for to help make sure their products are equipped the cars process camera footage, Light Detection materials, and predict materials’ properties 19 to evolve constantly. and Ranging (LIDAR) data and real-time information and behavior. Testing materials in hypothetical on road conditions and traffic. Initially, this system ways, and even for applications that are not yet Since the launch of Amazon’s Echo devices, will let GM deliver over-the-air software updates possible, will help companies understand and for instance, the company’s Alexa assistant to customers, remotely improving vehicle maximize their products’ full physical potential. has changed the way many consumers obtain functionality without requiring drivers to visit information and interact with their personal spaces. a dealership. In the future, it will be critical to Leading companies are extending the value But moves from Amazon indicate the company delivering more autonomous driving capabilities. of their physical products by adopting the has ambitions beyond stand-alone smart speakers. mentalities of digitally born organizations. The Amazon Echo Flex is a smart outlet that not But to be truly successful, enterprises must By embedding intelligence into physical devices only contains a microphone for Alexa interactions, move past thinking about what is minimally and designing flexible products that can support but also a USB port that can support plug-and-play viable and consider what will make a product new capabilities as they become possible, these accessories, such as motion sensor and nightlight maximally valuable over its entire lifecycle. companies are setting themselves up to increase 17 accessories. By opening up a developer API and Businesses will find that their ability to iterate functionality over time. Ultimately, they will form technical specifications, the company is creating and improve products over time will continue stronger relationships with customers, built on a modular ecosystem that will grow and change to grow exponentially as the data they use an understanding that the devices they purchase as developers create new accessories in the future. becomes more granular. Case in point: Siemens today will appreciate in value tomorrow.
Why Now? Experience-driven products Connectivity, intelligence and digital are redefining the relationship experiences define today’s newest products. between people and enterprises. Statista predicts that IoT-connected devices will reach 20 Customers are not only buying 75.44 billion by 2025, up from 30.73 billion in 2020. physical goods, but also opting In a 2018 Accenture survey of manufacturers, 98 percent of respondents reported they had already started integrating into an ongoing partnership AI in their products.21 with the companies managing The growth of AI-enabled IoT products—which often need those products. to process data and make decisions locally—is one of the key drivers of edge computing. IDC predicts that by 2022, But as more organizations seek to deliver edge computing will be included in more than 40 percent experience-driven products and engage of businesses’ cloud deployments, and a quarter of endpoint these new relationships, they are running devices and systems will use AI.22 up against new challenges, too.
Enterprises increasingly need to account for Experience-driven products and ongoing the other technology in people’s lives—or risk relationships with customers are letting turning them away. businesses collect more data than ever. But unaddressed concerns over privacy On average, US homes with a broadband connection own more and security are leaving customers wary. than 10 connected devices.23 A survey conducted by Consumers International and the Internet Seventy-five percent of customers intending to buy a connected Society found that 63 percent of people think connected devices device in the upcoming year state that an important factor in are ‘creepy,’ because of how they collect data, and 53 percent don’t their purchase decision will be the device’s ability to work well trust connected devices to handle their information respectfully or with other devices.24 26 protect their privacy. More than a quarter of people who did not already own smart devices said that security concerns are enough Digital workplace tools interrupt workers 13.9 times a day, to deter them from buying one. despite 86 percent of workers reporting they expect simplicity and ease of use from the tools they use.25 In Edelman’s 2018 Trust Barometer, 83 percent of global respondents believe that protecting people’s privacy and information is one of 27 a company’s most important responsibilities. In the first half of 2019, data breaches were up 54 percent year 28 over year. The number of records exposed went up 52 percent.
Survey Stories Are customers and businesses divided on the future of products? 47% of consumers agree: Software update cycles are increasingly becoming a burden on users to keep up to date on security patches, changes in functionality, and need to learn new interfaces. Based on role technology plays in consumers’ lives: 54% 45% 39% 47% Technology plays a minor Technology plays a prominent Technology is ingrained Technology is so intertwined or modest role in my role in my day-to-day life. into almost all aspects with all aspects of my day- day-to-day life. of my day-to-day life. to-day life that I view it as an extension of myself. N=2,000 Global Consumers
When it comes to the next generation of products something without constant updates, and 46 percent disrupting or distracting customers will also be driven by digital experiences, enterprises will need believe updates often bring new problems with them. critical—an outcome businesses are still striving to pay careful attention to the expectations of their For now, enterprises are somewhat off the mark with toward, as 45 percent of executives surveyed customers if they hope to succeed. this sentiment. Sixty-eight percent of enterprises believe updates occur with minimal disruption believe customers don’t mind, or even welcome, and inconvenience to their users. Today, according to the Accenture Technology Vision software updates to their organization’s connected 2020 survey, 49 percent of companies report that products and services. In the long run, enterprises will have to come more than half of their products and services require to terms with the fact that experience-driven products subsequent software updates after the initial purchase. To begin addressing customer expectations, are challenging the norms of product ownership. This number—and the speed at which new experiences businesses should take a proactive approach to Only 47 percent of executives believe that ownership are delivered—are expected to grow. Over the next transparency. Only 48 percent of businesses believe over their connected products and services is shared three years, 74 percent of companies expect more, they provide customers with detailed information with the customer or requires an ongoing customer or significantly more, updates to their organizations’ on new features or security of updates for connected relationship. Realigning the enterprise perspective products and services. products and services. Ensuring businesses aren’t with the new reality of ownership will be key to success in the next generation of products. While increased connected experiences are coming, customers remain concerned about the burden these frequent (or constant) updates introduce. Forty-seven percent of consumers believe software update cycles In the long run, enterprises will are increasingly becoming a burden on users to keep have to come to terms with the up to date on security patches, changes in functionality and new user interfaces. While consumers do see the fact that experience-driven need and benefit of certain updates—72 percent of consumers say they are highly tolerant of software products are challenging the updates that address security issues—sentiment norms of product ownership. splits when it comes to updates for features and functionality. Forty-seven percent just want to buy
Deep Dive Minimizing the “data burden” Successfully creating a digital thread, digital twin or digital experience means using potentially sensitive customer data to support intelligent service delivery and updates. This practice is bound to expand as enterprises move toward experience-driven products, and not addressing it properly will compound the effects of the beta burden. Whether data is generated by a camera, a microphone in someone’s home, telematics or geographic and location tracking, this information allows companies to power valuable, individualized experiences. But it also creates risk—a risk to privacy and security that is yet another extension of the beta burden. Maintaining a constant connection with customers through products demands that businesses rethink their data practices to emphasize privacy, security and accountability. Fortunately, several emerging technologies and approaches offer a path forward.
Foster customer trust One technique is infusing privacy directly into The ability to have and contain this intelligence Still another approach that protects data from the way that edge devices are architected. on the edge is powerful. But there are cases being seen by a central system—even when it’s Using edge products themselves to host AI where deriving insights requires a central analysis in fact sent to one—is homomorphic encryption. lets enterprises keep user data local, rather or combining larger pools of data from a cohort This technology enables computation on than sending it to a central service for analysis. of partners. Rather than openly share data between encrypted data without the need to decrypt it first; Previously, the necessary computing power and all partners in an ecosystem, companies are turning data can be transported, processed, augmented technology to support this approach were not to machine learning approaches that can combine or changed by a third party, without letting that able to fit into smaller edge devices, but advances insights from multiple, disparate datasets without party see the data they are working with. Even the in chips and processing power made it a viable directly sharing and combining the data first. most sensitive data can now be shared for analysis option. Simcam, an in-home security system, A consortium of 10 large pharmaceutical companies without actually exposing it. Travis County, Texas is uses an “intelligent edge” approach to deliver created the Machine Learning Ledger Orchestration developing a voting system that uses this approach 29 an AI solution on its in-home cameras. A key for Drug Discovery, a blockchain-based distributed to monitor the voting process ahead of the 2020 30,31 32 point of value for a home security system is the learning model. The system is allowing partners US presidential election. Without ever touching ability for a camera to detect events or objects to to train a drug discovery algorithm without each the actual votes (which could open up the system trigger a security response. But in order to provide company directly sharing its data with the others. to bad actors manipulating data or voter fraud), privacy, all facial recognition occurs on the Simcam Raw data is never seen by the whole ecosystem, analysis of voting data can be performed while device itself, rather than sending data to the cloud while the traceability of the blockchain ensures that it is still encrypted. for analysis. Simcam’s cameras use Intel’s Movidius every operation is seen and accepted by all partners. Visual Processing Unit (VPU), and analysis is run locally using Intel’s hardware. This allows for more control and privacy—and ultimately fosters more customer trust.
As businesses increasingly develop experience-driven products, protecting the data that powers those experiences will be critical. By developing systems that enable privacy and security from the outset, businesses will build trust with consumers and reduce the risk of collaborative efforts across organizations.
Decision Points How is your business responding to What is your company’s long-term How are you creating maximally the changing nature of ownership plan for products? valuable products? with the products you sell? As the focus turns to selling continuous experiences, Design products to evolve and grow over time Traditional models of ownership are shifting as your company will need a different strategy for the in response to customer usage and insights. devices gain the capacity to significantly change products that support those experiences. Explore Build a feedback loop by identifying what data their functionality. Evaluate your organization’s ways of helping customers through this transition would be necessary to understand your customers’ current ability to support a shared model of product to ensure long-term loyalty. evolving needs. Develop the tools and platforms ownership: everything from how customers are to capture that data. on-boarded, to how they are engaged with over Identify the biggest stakeholders in your product time can present myriad new opportunities to build ecosystem. This will include customers as well as Make future-focused design thinking a part relationships with customers, but it requires changes app developers or other device providers. Design of every product development process. Explore across the organization (from product development, a review process that will uncover what obstacles what customers might want in five years and work to marketing, to support). these stakeholders may face as software updates backward to consider what sensors or technologies change the functionality, interoperability and might be necessary to support those ambitions. features of their products. Help customers meet their sustainability goals. What can they do with aging hardware, and what expenses will they incur over time? Explore new strategies like developing a recycling and trade-in program or allowing people to repair devices themselves.
Reinvent Reinvent products, Reinvent reinvent reinvent the business reinvent
Bold Predictions 3 5 7 In three years In five years In seven years Data portability will be a Edge devices will have local The top-selling connected requirement for all connected intelligence backup for when products will offer “digital products sold in the US and they are disconnected from lifetime guarantees,” allowing European Union. cloud-driven intelligence customers to replace devices and analysis. for free when the original hardware becomes obsolete.
Trend 4: Robots in the Wild Growing the enterprise’s reach— and responsibility
Build new models of interaction and impact as robotics move beyond the walls of the enterprise. Companies in every industry will unlock new opportunities by introducing robots to the next frontier: the open world.
Once upon a time, a robot went hitchhiking Built at Ryerson University in Toronto, hitchBOT market will reach $241 billion by 2023; only half of had a simple goal: go out in the world and see that will be in manufacturing, the traditional mainstay 1 5 how people react. With pool-noodle arms, GPS of robotics sales. At the same time, the rollout of 5G tracking and simple communication software, it networks will unlock opportunities for all industries hitchhiked across Canada, visited Germany and to extend their autonomous capabilities outside of the Netherlands and racked up thousands of fans. contained settings like warehouses and production The next year, a new hitchBOT set out from Salem, facilities—and into the open world. Massachusetts with “San Francisco or bust” taped around its head and a bucket list of American These technologies are setting the stage for landmarks to visit. Two weeks later, its disassembled a massive robot migration, beyond controlled body was found on a street in Philadelphia.2 environments into uncontrolled spaces and from specialized industries to every industry. The hitchBOT (b. 2014, d. 2015) met an untimely end, but significance of this transition cannot be understated. its journey is more significant and relevant than ever. Even with a cursory knowledge of manufacturing, Advances in robotics, sensors, speech recognition it’s clear the advent of robotics radically changed and computer vision are combining with shrinking the economics of the industry, allowing companies hardware costs to make robots accessible for to scale and transform in unprecedented ways. And companies and industries that haven’t traditionally as the sophistication of the machines grew, what 3,4 used them. IDC predicts that the global robotics the enterprise was able to accomplish did as well.
7 Now the same benefits and advances that were largely limited freeing up store associates to better engage customers. And in the to manufacturing and adjacent industries are coming to every building industry, Advance Construction Robotics’ TyBot is using company in every industry. Advanced robotics are offering a repurposed self-driving car technology to automate the otherwise path to push the intelligence of the digital world out into the highly manual and physically demanding task of tying rebar, allowing physical one, and a chance to further expand the capabilities jobs to get completed faster and more safely.8 of the organization. Like the makers of hitchBOT discovered, it won’t be an easy transition, but it’s rife with opportunity. The complete realization of this migration will take years, but there are already new opportunities available today for industries that have Some of today’s biggest companies are already using this shift not focused on robotics in the past. to find new ways to serve customers and improve operations. As many people anticipated, Amazon is entering the robot delivery business: its small, six-wheeled delivery vehicle, called “Scout,” can autonomously navigate real-world obstacles like trash cans, pets and snow blowers; Scout also features a cute exterior designed to 6 delight customers. Walmart is introducing a variety of robots that scrub floors, check shelf inventory and sort inbound packages, Advanced robotics are offering a path to push the intelligence of the digital world out into the physical one.
Take agriculture, where 2018 saw orders of robotic What’s more, businesses are thinking beyond devices to food and consumer product companies applications that involve moving or manipulating 9 grow by 48 percent. In the fields, FarmWise is looking physical items, to applications that explore human to deploy autonomous robots to handle everything interaction as well. Swedish company Furhat Robotics from seeding, to weeding and harvesting. The California is working with TNG, a Swedish recruitment firm, 12 startup, which raised $14 million in 2019, makes devices to deploy Tengai, a robot interviewer. TNG believes that combine computer vision, a host of sensors and that a typical job interview can be filled with chances learning algorithms to gather and act on data specific for unconscious bias—based on age, gender or other 10 to each individual plant. And in Denmark, Rosborg Food factors—that influence both the job seeker and the hiring is using robots from OnRobot with advanced gripping manager. Many companies have developed algorithms technology and computer vision to handle delicate that attempt to eliminate this kind of bias, but Furhat’s greenhouse plants. These capabilities allow OnRobot’s solution goes a step further: Tengai has a physical devices to account for variances like misshaped or heavier presence. She sits at eye level to the interviewee and materials—challenges that would have prevented robotics performs some human-like behaviors (such as smiling applications in greenhouse agriculture in the past. As these and blinking) to give job seekers a somewhat familiar robots demonstrate, flexible and reprogrammable devices setting for an interview. But Tengai delivers an interview can be applied to a variety of material-handling tasks found experience that’s aimed at eliminating human bias, across industries, making their potential for impact that giving recruiters a more objective assessment of the 11 much greater. candidate on which to base further decisions.
Companies have already seen the benefits of in 2016—and those fleets of robots won’t deploy 13 robotics in controlled spaces, from lower production or maintain themselves. Savvy businesses are costs, to higher productivity and increased capacity investing in robotics hiring today, driving a for analytics. Open world autonomy will amplify 121 percent jump in demand for robotics technicians 14 these benefits further—and, as these examples since 2017. This is followed closely by the people show, it’s already unlocking new capabilities and who will handle all the data those robots gather and % opportunities in industries that have not traditionally generate: data scientists, a profession that saw an benefited from robotics in the past. 88 percent increase in demand from 2018 to 2019. 6611 These opportunities don’t come free, though. Just as important is the reality that not every of executives expect As robots become feasible in more industries, company will be able to find the ready expertise their organizations the challenges and limitations that only robotics in the talent market. Existing degree and certificate will use robotics companies have dealt with in the past are now programs can’t meet this exploding demand for obstacles and opportunities every enterprise talent, and leaders know it. Already, 84 percent of in uncontrolled must consider. employers have talked about plans to upskill their environments within workforces by 2020—up from just 21 percent the next two years. 15 The first major challenge will be the necessary in 2011. talent investments. The global mobile robotics market is projected to grow to nearly $31 billion by 2025—a 361 percent increase from $8.58 billion
Businesses are moving beyond collecting Amazon’s Scout delivery device will interact with and relying on data from their own operating employees who send the robot into the open world, environments toward a future where robots as well as customers when it arrives at their door. allow them to interact physically with the world. But in between those two endpoints, Scout may also Accessing the full opportunity of this new frontier cross paths with drivers, people walking their dogs, will require robotics technicians, data scientists mail carriers and curious children or adults. Some and fleet management expertise at a level that people will find the device interesting and want 48% can only be met through a strategic combination to interact with it; others may find it intrusive and of hiring and sustained upskilling efforts. want to steer clear of it; and a few may even want to vandalize it. Amazon and other companies must Talent challenges are only the beginning. These prepare for these and myriad other eventualities, forays into the open world will also force companies gathering data all the while to better inform future to consider a new audience impacted by their robotics efforts. That means a substantial investment products and services: people with whom they in human-computer interaction expertise. It also Consumers surveyed believe have no employee or customer relationship. When calls for expanding that expertise beyond the strictly robots are poised to make robotics remained confined to companies’ own defined audiences that companies have focused controlled environments, they could draw boundary on in the past. their lives easier (48%) or more lines around specific audiences that might interact efficient (41%). At the same time, with the devices: a company’s workforce or existing 39% state they are concerned customers. Open-world autonomy makes those robots will introduce more boundaries moot. problems than they fix.
Get ready to meet the challenge Finally, a large-scale migration of robotic devices and handle encounters with other pieces of into the open world poses unique challenges for equipment. Using Microsoft Azure to process data development and testing of solutions. It’s an area collected by devices and simulate future behavior that demands a combinatorial approach to testing; allows Toyota to dramatically reduce the six months a commitment to continued data collection and to a year that they would otherwise spend on 17 refinement of solutions after devices are in use; automated guided vehicle implementation. and for solutions whose fully autonomous time has not yet come, early experimentation that will UPS is using TuSimple, an autonomous trucking inform large-scale rollouts when the technology startup, to move cargo between Phoenix and 18 and regulations allow. Tucson, Arizona. The system isn’t fully autonomous; it’s locked to a geographic location and a safety In the self-driving car industry, companies are driver and engineer are always on board. But it exploring ways of finding and accounting for edge is clear where UPS is headed. The company also cases in autonomous operation through simulation. created a subsidiary called UPS Flight Forward to Waymo, Alphabet’s self-driving car business, has oversee future drone operations, and is seeking logged 10 million real-world driving miles so far, government approval to launch an unmanned 16 19 but it has simulated 10 billion more. Microsoft is drone delivery service. partnering with Toyota to develop digital twins for intelligent forklifts, allowing Toyota to simulate how an autonomous forklift will navigate an environment
Enterprises aren’t just building these capabilities Across industries, the proliferation of robots Finding the right way to integrate robots into for themselves, either. Boston Dynamics is gearing from the traditional controlled warehouse and organizations and the world includes challenges up to release its first commercially available robot manufacturing environments into the open world around talent, questions of human-computer for open-world use. “Spot” is a quadrupedal bot offers enormous opportunity. Increased customer interaction and a testbed that quite literally consists with a long robot arm, designed so that customers interaction, data collection and even branding of the whole world—with no boundaries or built-in can apply it to a range of use cases like pipeline opportunities will be possible, as limitations on fail-safes. Businesses with an existing robotics 20 inspection or 3D mapping construction sites. the physical services that companies can provide practice may start out with an advantage in the For now, Spot still needs human handlers to tell it in customers’ lives disappear. But capturing this robotics migration, but the opportunity is ripe for where to go. But the robot can function in open- opportunity will never be as simple as buying companies in every industry to extend their reach: world environments, keeping its balance on rough a robot and sending it out the door. beyond their controlled spaces, beyond their terrain and navigating mapped areas on existing employee and customer relationships, its own.21 and out into the open world. Experimentation with solutions like these today will give leaders a dramatic edge as technological advances make it possible to incorporate robots on city streets, university campuses and construction sites. Far outside the walls of the enterprise, machines are already contending with variable Across industries, the proliferation of robots operating conditions, densely human-populated from the traditional controlled warehouse spaces and even other autonomous devices. Companies that get started today will position and manufacturing environments into the themselves to take the lead as robot migration becomes a major driver of value and growth. open world offers enormous opportunity.
Big Takeaways The robots Extending Diving into are coming the business the ecosystem Advances in robotics, falling hardware Enterprises are being presented with Every executive must start to see their costs and the advent of 5G are enabling exciting new paths to engage the world company, at least in part, as a robotics a major shift. Businesses are starting to around them. Already, robots are being company. This means forging new extend their robotics capabilities into used by companies big and small to partnerships, hiring new talent and finding uncontrolled environments and the engage and delight customers, solve new vendors that will grant access to the open world, and robot use cases are logistics difficulties or take on difficult and skills, tools and machines that companies expanding from specialized industries dangerous tasks. No matter the use case, need to tackle their biggest ambitions. to every industry. advanced robotics offer enterprises an opportunity to push the intelligence of the digital world out into the physical one.
Deep Dive Getting started with smart cities As robots make their way to city streets congestion pricing to alleviate traffic, the city banning all government agencies from using 25 and airspace, it’s critical that businesses of Buffalo has eliminated minimum parking facial recognition technology. While this was in collaborate with public leadership to requirements for new commercial and residential response to resident concerns about surveillance ensure a safe and welcome transition. projects, and several other cities have reduced and privacy, it could also impede the city’s or eliminated cars in their urban centers.22,23,24 ability to integrate cutting-edge technology that New technologies have always shaped the relies on computer vision, like optimizing traffic development of cities. When automobiles Today, this relationship is once again taking flow. On the other end of the spectrum, electric eliminated horse-and-carriage transportation, center stage. As robotic capabilities grow and scooter-sharing startups Bird, Lime and Spin they transformed the look and feel of urban more businesses want to use them in the open launched in San Francisco in 2018, distributing environments. Highways were constructed, world, companies are finding that introducing their scooters across the city. Initially, the suburbs got bigger and more space was new devices and technology to the cityscape devices were embraced by residents. But not dedicated to parking. But cities also shape is anything but a smooth transition. long after the launch, the city banned all electric the development and use of technology. scooter-sharing companies, citing clashes with Dealing with the consequences of having San Francisco perfectly demonstrates why. pedestrians, illegal scooter-riding on sidewalks too many cars, New York City is adopting In 2019, the city took a preemptive step, and hazardous parking.26
Robots at the watercooler, in the supermarket, on the freeway 30 31 Yet San Francisco has also shown a successful drone airline. This certification does not place a of industrial robots worldwide. Now, in preparation way forward: measured coordination between cap on the number of drones that UPS can operate, for hosting the Olympics, government officials and enterprises and the city. After the initial ban, the which means the company has the flexibility robotics experts formed the Tokyo 2020 Robot city developed a permitting program for electric to roll out this technology according to market Project, developing robots that will assist spectators 32 scooters. Lime, Spin and Scoot (now owned by Bird) demands. Additionally, the FAA has granted UPS throughout the Games. The robots will provide were all granted permits and allowed back onto city certification to operate its drones beyond visual visitors with directions and event information, 27 streets in 2019, alongside newcomer JUMP. Also line of sight, meaning UPS’s network will be able and will support people who use wheelchairs. that year, Postmates worked with San Francisco to cover more geography. UPS has partnered with to receive the first permit to test its autonomous WakeMed to bring drone delivery capabilities first to If businesses want to introduce robots to city delivery robot, overturning a blanket 2017 ban on healthcare networks—where the company already streets, they will need to partner with governments 28,29 the devices. There are some limitations—each has experience operating deliveries in African and gauge public sentiment. These partnerships robot must have a human operator within 30 feet countries—and eventually UPS will expand to other may impose limitations and safeguards initially, during all testing, cannot go faster than three miles industries as it gains operational experience. but they are a key ingredient for long-term success. per hour and must stay within a few restricted Continuously engaging with stakeholders will let blocks. Plus, permits are only valid for 180 days. Coordinated public/private efforts also create businesses build critical support and a strong But public/private coordination like this sets a level of trust that encourages local governments foundation for new technologies in the future. everyone up for success in the long term. to not only welcome innovations, but also solicit them. Japan already has a long history with robotics; Look at how UPS is preparing to run a drone delivery in 2017, the country employed approximately fleet. The delivery company has been granted 300,000 industrial robots, the second highest certification from the FAA to run a first-of-its-kind number globally, and supplied nearly 55 percent
Why Now? The financial, mechanical Technology advancements have made robotics and computational capability integration feasible across more industries barriers of robotics are than ever before. coming down, bolstering In the agriculture industry, robots have already improved efficiency and helped address labor shortages. More advanced robotic systems have the demand while bringing potential to take those gains even further, doing everything from taking care of and harvesting plants, to collecting on-site data, increasing crop yields. agility and scale closer than The global agricultural robots market exceeded $4 billion in 2018 and is ever. Equipped to spread far expected to reach $10 billion by 2024, with a projected compound annual beyond factory floors and growth rate (CAGR) of 16 percent.33 repetitive tasks, the trajectory Waymo developed its own line of sensors for its fleet of fully autonomous, self-driving cars, which have now driven more than 10 million miles on 34 of robotics technology is the road and 10 billion miles in simulations. The equipped sensors boast a 95-degree vertical view (compared to 30 degrees for other sensors), outward bound. and, in 2019, the company made its sensors commercially available.35 In 2018, the US Federal Aviation Administration (FAA) recorded 175,000 new commercial drones, an increase of 170 percent. This exceeded the 44 percent growth officials had initially predicted by such an extent that the FAA updated its long-term growth estimates—now predicting that the commercial drone market will grow to 835,000 aircraft by 2023.36
Key markets are shifting, both incrementally The advent of 5G has arrived, and with and radically, in ways that make robotics it comes a world more connected and implementation increasingly more practical, powerful than ever before. popular and profitable. 5G rollouts are happening worldwide. The US, UK, Germany and Urban populations are on the rise, and with them grows the South Korea already have 5G in some regions, with many more 37 42 opportunity for robotic delivery capabilities at scale. A recent study countries planning to follow suit in the next year. South Korea’s SK revealed that there is strong demand among 57 percent of global Telecom hit one million 5G subscribers in the first 140 days of service, 43 consumers for more restaurants to offer delivery; meanwhile, looking surpassing its 2011 4G LTE uptake. And 5G is expected to account beyond food, global parcel volume is expected to more than double, for 40-50 percent of global mobile connections by 2034.44 38,39 from 87 billion in 2018 to 200 billion by 2025. Companies are already piloting delivery robots in testbed regions.40 In 2019, carriers AT&T and Verizon both launched their 5G networks in more than a dozen US stadiums. The concentration of people, The growing industry of Robotics-as-a-Service (RaaS) allows along with an augmented reality (AR) experience use case, made manufacturing companies to outsource the often-prohibitive, these venues the ideal place to vet the early rollouts. In the stadium, up-front cost of automation, which offloads risk. The RaaS installed fans could connect to the network and participate in AR experiences base is expected to experience a massive increase during a 10-year through their smartphones, such as dancing with virtual NFL players.45 period, from approximately 4,000 units in 2016, to more than one million in 2026.41 The record-breaking speeds, capacity for a higher number of connections and minimal latency of 5G are enabling a new frontier in the internet of things (IoT). In the healthcare industry, 5G devices are already being developed to enable remote surgery, which would allow for highly specialized training for the next generation of doctors. The expansion will bring previously inaccessible healthcare to worldwide populations.46
Survey Stories Expanding responsibilities in a world of robotics By Country 59% Argentina 49% Japan 66% Australia 64% Kazakhstan 80% of executives Austria 60% Mexico 64% agree: Brazil 59% Peru 53% Social and service Canada 58% Portugal 56% robots in public spaces Chile 53% Russia 41% will raise major ethical, China 50% South Africa 57% legal, and societal Columbia 48% Spain 66% concerns, including France 64% Switzerland 61% security threats and Germany 54% Thailand 73% privacy risks. India 67% United Kingdom 57% Indonesia 57% United States 60% Ireland 55% N=6,074 Business and IT Executives 59% Global Average 59% Global Average
The robotic revolution and 5G-powered business models China and Indonesia hold the strongest beliefs that people are poised to dramatically alter the competitive landscape in their country will fully embrace robots in public spaces, for businesses in all industries—whether those businesses whereas executives from Ireland, Canada and France, know it or not. While 95 percent of executives believe have some concerns that people will not accept robots. their organization will be using robots in uncontrolled environments in five years or more, the trend is already More enterprises are understanding that the key to under way in retail where 76 percent of executives report overcoming doubt and successfully pursuing opportunity they are already using robotics or anticipate using them means addressing new questions and responsibilities. in three years or less. Fifty-nine percent of executives believe that social robots % in public spaces will raise major ethical, legal and societal 4545 However, the Accenture Technology Vision 2020 survey concerns, including security threats and privacy risks. results show that as robots move beyond the factory and More than immediate risk, businesses must also consider of executives warehouse, a range of opinions is forming around how the impact robots may have on the “digital divide”—the believe employees people and the workplace will be impacted. Consumers disparity between those who have access to technology appear to be enthusiastic about the potential of robots and those who do not. While 61 percent of executives will be challenged taking a bigger role in their lives: 48 percent of consumers believe robots can reduce the gap on inequality and the to figure out how believe robots are poised to make their lives easier, and digital divide, 28 percent believe inequalities will widen, 30 percent think robots will make their lives more fun. Some or significantly widen, as more robots emerge in society. to work with robots. businesses, on the other hand, hold a more conservative outlook and retain concerns about the acceptance of As executives craft strategies to guide the enterprise into robots in the workplace: 45 percent of business executives a robotics-driven future, they must account for the growing believe employees will be challenged to figure out how to impact their presence will have on customers and society work with robots. Interestingly, geography seems to be at at large. Ensuring safe and equitable integration with the least one factor guiding sentiment—perhaps due to social world will be one of the pillars of success. and cultural norms. Business executives in Kazakhstan,
Deep Dive Where are robots headed first? Robotics technologies have been distributed disproportionately for decades. Concentrated mostly in manufacturing and shipping, One reason robotics have remained concentrated in they’ve been limited to a few key industries like controlled spaces is latency: in factory or warehouse automotive manufacturing and located almost environments, robots largely perform repetitive tasks exclusively in controlled spaces. Amazon currently with little variance, so that connectivity and latency relies on more than 200,000 robots to move packages are of minimal importance. Yet in recent years, as 47 and other goods throughout its warehouses. On a mobile connectivity has become more widespread, daily basis, Chinese e-retailer JD.com guides 200,000 faster and more reliable, companies have begun packages through an entirely automated fulfillment to explore the possibilities of robotics outside of 48 center. FANUC, a Japanese manufacturing company, controlled spaces, and new industries are getting employs a cloud solution that connects more than into the game. 21,000 of its robots, saving customers more than 2,400 hours of unexpected downtime and the company an estimated $72 million since its introduction.49
Find new testbeds In 2018, the highest number of robots ever shipped deliver food to students around the school and in population of just 22,000, has historically been among 50 went to non-automotive businesses in North America. nearby neighborhoods. Someday the robots may be the last to receive new technology infrastructure. Mining companies are using unmanned machines fully autonomous, finding their own routes. But for now, But Orkney is betting big on 5G as not only a way to increase safety and efficiency, with Komatsu’s Front the Kiwibots are guided by remote human operators to improve their own connectivity, but also to drive Runner autonomous haulage system moving large who plot “waypoints” and send the bots instructions business engagement and investment. A consortium quantities of surface material 24 hours per day without at five- to ten-second intervals.55 backed by a government grant is operating a private sending human operators into dangerous sites.51 5G network across the islands targeted at local In agriculture, autonomous tractors have improved Companies are also beginning to explore the industrial needs: “If we can drive industrial use then data collection, planting efficiency and accuracy; value of 5G in enabling a larger impact through there will be more demand, which means more New Holland’s autonomous tractor lets farmers take robotic migration, and they aren’t waiting for 5G revenue, which means more capacity,” explains Greig full advantage of good weather by operating at any rollouts to come to them. In the US, AT&T and Badger Paul, an academic member of the consortium.57 52,53 time of day. The trend is underway globally as well. Technologies—the product arm of manufacturing FlyZoo, Alibaba’s 290-room hotel near its headquarters services company Jabil—are partnering to accelerate Similarly, the Chinese city of Chongqing opened the in Hangzhou, China, is almost entirely autonomous, retail automation with 5G-enabled, in-store robots. first 5G-enabled open-road autonomous vehicle pilot with robots delivering room service and fresh towels, Badger’s robots can identify out-of-stock, mispriced zone in the country. Local automaker Chang’an is using and mixing drinks for guests in the hotel bar.54 or misplaced inventory, and AT&T’s in-building 5G the 4.3-kilometer-long area to test self-driving vehicles, and edge-computing solutions provide the robots reportedly working on building robotic taxis and an Businesses that are new to this space are finding with the computational power and lower latency automated parking system.58 unique ways to manage the demands of open-world needed to function efficiently.56 autonomy. On busy streets, crowded sidewalks, remote terrain or even inside homes, safe operation means Cities are also finding they can attract innovation reacting to irregularities instantly. At the University of and opportunities by rolling out 5G, turning their built California, Berkeley, Kiwibots—four-wheeled delivery environments into today’s newest and most valuable vehicles approximately the size of an ice cooler— testbed. The Orkney archipelago in Scotland, with a
The robotics migration will happen across multiple fronts and in several stages. The long- term rollout of 5G will enable the full potential of open-world robotics over the coming years; leaders are finding ways to get early access or even facilitate its expansion. In the short term, there’s already new value to be captured from the first phases of the robotics migration, and significant advantages to be gained for those who begin today.
Decision Points How will the advent of open-world robotics Are you tracking the launch of 5G networks impact your industry? in relevant markets—or exploring new markets based on 5G availability? Conduct a discovery initiative to identify the latest advancements in robotics underway in your industry. Increased access to 5G networks will help spur widespread adoption of connected assets, including robotics. Increased mobile network speeds Assign a cross-functional group to study these insights and lower latency are major factors that will enable autonomous devices and forecast where the company stands to grow, or be in new environments. Look for opportunities to capitalize on nearby launch threatened, based on the trends. markets and explore the industrial applications that 5G networks present. Develop a strategy to build, buy or partner in order How will your business build trust for robots among to develop the necessary robotics capabilities. the variety of stakeholders who will encounter them? Is your business ready to engage a wider Take steps to help people who are interacting with these devices to understand set of partners? machine behavior. Your company will be responsible for handling interactions with a much larger array of individuals, and many of these people will not be your To ensure the success of robotics innovations, companies customers, so these encounters may be their first interaction with your company. need to be prepared to interact with a larger set of stakeholders. Consider the user experience and human-machine interaction expertise your Engage government regulators to create policies for autonomous company will need to navigate these uncertain waters. devices in new environments and identify vendors for collaboration to shape strategic agendas. To minimize potential disruptions your robots may cause in uncontrolled environments, take steps to design devices in a way that clearly conveys intent. Work with industry partners to standardize these systems whenever possible.
Bold Predictions 5 7 10 In five years In seven years In ten years Urban dwellers will have A major clothing retailer will There will be a 1:1 ratio 5 to 10 daily interactions become the first to introduce between autonomous robots with autonomous devices. consumer-facing robotics and healthcare professionals services like in-home custom in every major hospital. tailoring and same-hour size exchanges.
Trend 5: Innovation DNA Create an engine for continuous innovation
Tap into the unprecedented scale of disruptive technology available today. Build the capabilities and ecosystem partnerships necessary to assemble the organization’s unique innovation DNA.
Fujitsu wants to solve the world’s most complex problems with quantum computing—but the technology is still maturing. So, the Japanese IT giant teamed up with 1QBit, a quantum computing startup, to create something new—something not quite quantum, but quantum-inspired. They built a digital annealer, which can conduct Using the digital annealer to optimize the processes calculations at quantum scale and speeds without and workflows, employees reduced their distance needing to achieve a genuine quantum state. Taking traveled during parts gathering by 20 percent every 2 inspiration from quantum designs, it’s able to solve month. What’s more, Fujitsu isn’t planning to keep complex problems that researchers once thought this innovation to itself. The company is expanding 1 only quantum devices could solve. its business by offering new on-premises and cloud-accessible digital annealer services to clients Fujitsu deployed the new digital annealer at the in industries ranging from automotive production main manufacturing site for its flagship products. to retail.3 The site stocks 3,000 unique parts and gathering them for product assembly was largely inefficient.
Fujitsu’s efforts highlight the new approach by pairing the opportunities yielded by an to technology innovation all businesses must unprecedented range of technology with their undertake as they enter an era where digital is own unique capabilities. The big challenge is pairing everywhere. The company leveraged partnerships consistent, perpetual innovation with constant % to access an emerging frontier of technology experimentation, using that combination to set 7676 and reinvented its current tech in the process. a course for where the company will go next. Then Fujitsu applied the resulting new capabilities Over three-quarters to a problem it has today, while surging toward A transformation of this magnitude won’t be easy. of executives (76%) the future by exposing new lines of business. But it starts in a familiar place. The path forward In essence, Fujitsu turned the entire enterprise begins with a renewed focus on the building blocks believe that the stakes into an engine for innovation. that have allowed companies to get to this point for innovation have never of opportunity in the first place: technology. To turn been higher—getting it This level of comprehensive innovation is an the enterprise into an engine for transformation, imperative for companies looking to not just meet, businesses must first assemble their unique ‘right’ will require new but also exceed expectations in coming years. innovation DNA. ways of innovating with With mounting pressure from competitors ecosystem partners and and customers alike, the enterprise cannot afford to stand still, and incremental change won’t be third-party organizations. enough. Enterprises must continuously adapt and drive innovation through the entire organization
The DIY of DNA Just as human DNA determines individual To develop an innovation DNA fit for the accessible technologies are also making digital traits, with chemical building blocks future, businesses must find their unique transformations increasingly straightforward— combining to set much of the course for combination of the different building threatening any leading company that gets who people will be as individuals, innovation blocks. This starts with understanding too comfortable. Consider how Disney is DNA will define an enterprise as it grows the opportunities and risks of each. challenging current video streaming leaders into the future. Companies’ innovation DNA with its new streaming service, Disney+. has building blocks, too: maturing digital Maturing digital technology is no longer The company gained 10 million subscribers technology that is more commoditized an advantage, it’s a requirement. But in its first day of operation, and the service and accessible; scientific advancements many companies are finding new value is expected to become a major new competitor that are discrete yet deeply disruptive; and by commoditizing their systems. Choice for customers’ time and attention in the digital 6,7 emerging DARQ (distributed ledgers, artificial Hotels International has started selling its streaming market. intelligence, extended reality and quantum cloud-based reservation system to other computing) technologies that are poised hoteliers, and Starbucks is licensing its mobile to scale rapidly. Leaders are weaving and loyalty program tech to Brightloom, these areas of innovation together, forming which plans to provide the technology their own unique triple helixes and setting platform to other restaurant companies their course for the future. and more operators of licensed Starbucks 4,5 franchises. Commoditized and easily 111122
10 Meanwhile, scientific advancements are in 2020. Ultimately, the company ended broadening enterprises’ innovative efforts beyond the program, but its research provided valuable 11 digital technology and turning into competitive insight for future products. advantage faster than ever before. Advances in material sciences, energy, genomic editing and Finally, DARQ technologies are growing in utility more are deeply disruptive in related industries, and adoption by the day. Leading businesses but also beginning to challenge boundaries are exploring solutions with the technologies 56% and pull businesses in new and unexpected and actively building their foundation for a world directions. Dyson has taken its deep understanding with digital everywhere, while competitors may be of mechanical engineering to explore battery caught off-guard by faster-than-expected change. technology, where the company has been making Domino’s Pizza is getting a head start by teaming up 8,9 investments for several years. The research with Nuro, an autonomous-driving startup, to test opened an exciting new path. In 2018, Dyson filed self-driving pizza delivery. Customers in Houston can a patent for an electric vehicle and planned to opt-in during the check-out process, and their pizza of executives believe rapid 12 build a related manufacturing facility in Singapore is delivered via Nuro’s autonomous R2 vehicle. advancements in new technologies and scientific innovations are poised to disrupt their industries.
According to the Technology It is imperative that enterprises leave no stone unturned with the innovation DNA process, exploring and investing in the myriad Vision survey, executives rank opportunities available today in these three areas. But pioneers aren’t stopping there. Differentiation in the post-digital era will be 1. Climate change driven by powerful combinations of the different innovation building blocks. While leading businesses should have efforts across all three spaces, what will truly set companies apart is the way they 2.Sustainable development merge and combine the technologies with the core competencies of their business. Already, leaders are seeing the benefits—aligning 3.Energy seemingly separate innovation strategies to radically differentiate themselves, leapfrog industry competitors, build a new generation as society’s biggest challenges of products and services and even create new markets. that scientific research and Kebotix is a startup that uses AI—a DARQ technology—to speed up a physical scientific endeavor: materials discovery. New materials advances can address. are often discovered through the slow process of taking molecules with known properties and testing slight variations, searching for a viable new creation. Kebotix is accelerating the process by feeding 3D molecular models of compounds that have desirable properties into its AI system, which comes up with new designs that fit the 13,14 same model.
Accelerate the innovation engine Enterprises are also finding that the combination with digitized animals, in which the filmmakers could of digital technologies and scientific advancements roam and film. The result became the ninth highest will let them tackle bigger challenges. Anheuser-Busch, grossing film of all time, feeding one of Disney’s core the largest user of rice in the United States, is partnering businesses, but the technology used to make it was with Indigo Agriculture, which leverages microbiology brand new—exposing an innovative potential path 17,18 and data-driven analytics to make agriculture more forward for the company. 15,16 sustainable and profitable. Indigo’s scientists study bacteria and fungi that allow plants to thrive in harsh Discovering these connections and building a company’s environments, and develop them into seed coats, which innovation DNA is about more than checking a box for protect crops from extreme temperatures, water scarcity each of the three categories of innovation. Leaders will and more. The company also offers data-driven decision- use them to turn the enterprise on its head, becoming an making support to optimize regenerative agricultural engine for constant innovation. Well-executed strategies practices and improve farm margins. By partnering will not only explore and combine the different blocks, with Anheuser-Busch, Indigo is offering growers both but also accelerate the discovery process by forging the incentive and the means to commercially produce new partnerships, fueling experimentation and building sustainable rice. a culture and ecosystem that will drive those efforts into disruption at scale. Incorporating DARQ technologies into mature markets will also ground these tech explorations in reality. Across industries, leading companies are opening The 2019 live action The Lion King movie, for instance, dedicated spaces for exactly this—launching innovation was almost entirely shot in virtual reality (VR). Rather centers where researchers are tasked with exploring than building physical sets, each location in the movie how new technologies, or combinations of technologies, was created in a videogame-like virtual environment, can enhance their business.
In partnership with Accenture, Cisco and Hewlett Packard Not every business will have the resources to open a dedicated Enterprise, Walt Disney Studios opened StudioLAB, a tech hub innovation hub. But all can translate the attitude and mindset focused on using cutting-edge technologies to advance and of innovation hubs into their own strategies. Enterprises must 19 optimize the art of storytelling. All four companies are combining adopt ecosystem-based innovation strategies, be it through their expertise to come up with new ideas and develop new tools. venture-backed partnerships, academic research engagements They’re experimenting with 3D projection to create glasses-free or relationships with other companies. The problems, and VR, using drones to scout filming locations, building smart movie potential, of continuous innovation is an undertaking that few posters that recommend different movies to different viewers will successfully achieve on their own. and more.20 Innovation is evolving. Success in the future means Kraft-Heinz has also opened a technology-focused hub, constantly exploring what’s ahead, around and inside meant to fuel innovative ideas and digital growth. The company of the business. Leaders will seize opportunities through acquired Wellio, an AI food-tech startup in San Francisco to each of today’s innovation building blocks and form their kickstart the new lab, working on food-related digital solutions own unique innovation DNA. 21,22 for Kraft-Heinz customers. And Marriott has an innovation lab where researchers use a series of model hotel rooms to experiment with new technologies and different designs. Experimentation ranges from floor layouts, to desk size, to drones delivering cocktails.23 Innovation is evolving. Success in the future means constantly exploring what’s ahead, around and inside of the business.
Big Takeaways Unprecedented Build your Create an innovation innovation DNA innovation engine opportunities This isn’t a matter of checking three boxes. Businesses cannot look at innovation Businesses today have an unprecedented Enterprise leaders must carefully construct as an incremental effort; they must design range of innovation opportunities before their organization’s unique combination of the capabilities to make it an ongoing them. Leaders will take advantage of technology innovation. Determining where practice in the organization. Building this diversity, ensuring their innovation they hold an advantage, where they are innovation hubs, centers of excellence strategies include efforts from across lagging and what their future ambitions and co-innovation partnerships are some three major categories: maturing digital are will help leaders blend efforts across of the ways successful companies are technologies, scientific advancements all three categories to construct their ensuring a constant injection of new and emerging DARQ technologies. innovation DNA. skills, technologies and ideas.
Few companies can say they excel in all areas of technology innovation today. Yet there is plenty of opportunity for businesses to learn from leaders in each area Deep Dive when planning their innovation strategies. With a keen eye, businesses will find new Lessees can use their phones to schedule ways to drive competitive advantage and their car to be picked up, serviced and challenge the paradigms of their industry. returned—all during the workday when the Driving A closer look at the automotive industry car isn’t in use. This offering represents shows disruptive potential simmering as Volvo’s mature understanding about companies across the sector develop changing customer expectations in a world their innovation DNA. filled with access to digital technologies. continuous On-demand and mobile access to car- One signal of maturity in a market is related services demonstrate Volvo’s a company’s embrace of digital-first innovation potential in the changing innovation services alongside the products for which automotive market. they’re traditionally known. Look at what Volvo is doing with Polestar, its electric Automakers have also been longtime 24 car brand. Rather than just sell or lease investors in materials science research, in the auto vehicles, Polestar is offering vehicle primarily supporting the persistent leases that include a number of services goals of better vehicle handling and —like insurance, roadside assistance fuel economy by reducing weight. industry and maintenance—all managed via a Now, some leaders are pairing that comprehensive digital experience. goal with another: sustainability.
Honda R&D Americas has partnered with research Lyft has also taken steps to release similar data 80 percent of Pinterest customers and pairs groups at Clemson University and the University in the spirit of collaborative research that can well with the company’s approach to surfacing 27 of Delaware to explore using composite materials advance the entire field of autonomous vehicles. purchasable products alongside visual searches. 25 for vehicle doors and hoods. As a baseline goal, This could eventually bode well for companies the groups are developing a door for the Acura like Ford and Volkswagen, both of which have Looking further ahead, groups like Facebook Reality MDX SUV that achieves a 42.5 percent weight entered joint partnerships to develop autonomous Labs and Oculus are pairing AI image recognition 28 reduction while meeting similar performance vehicle technology. The fact that two automotive with extended reality (XR) experiences. They’ve metrics on crash testing and durability. The effort competitors are joining forces to innovate speaks begun collecting photo scans of indoor and outdoor 30 also allows for production at scale while being to how far companies must go to become spaces in their “Real World Index.” Ultimately, the 100 percent recyclable and adding no more than innovation leaders within their industries. goal of this index is to help XR devices save energy $5 per saved pound of weight. By taking a systems by drawing from this compendium instead of re- approach through materials science research, These innovations will not stay contained to mapping spaces when an individual enters a new Honda is setting itself up to lead in multiple industry specific industries for long, as momentum behind area. The opportunities for cross-collaboration are benchmarks, while adding a level of sustainability transformative technology pushes more investment rampant, waiting for bold enterprises to seize them. that hasn’t been possible with passenger cars and advancements. Already, improvements to in the past. machine vision and image recognition capabilities— When it comes to maturing markets, scientific which were being led largely by advancements advancements or DARQ, businesses are finding Automotive manufacturers and those developing in autonomous vehicles—are now finding new that these three horizons complement one another autonomous vehicles are also paving the way applications in forward-thinking enterprises. Pinterest more often than not. While not every business has for further advances in DARQ technologies, Lens is a visual search engine that recognizes each of these lenses fully developed, it is important highlighting the amplifying effect that ecosystem- more than 2.5 billion objects, “including tattoos, that companies remain open to exploring each of led innovation can have. For instance, Waymo nails, sunglasses, cats, wedding dresses, plants, them and forming the partnerships to build their has publicly released data from its autonomous quilts, brownies, natural hairstyles, home décor, own unique innovation DNA. 26 29 vehicles for academic researchers to use. art, food and more.” This tool is being used by
Why Now? With unprecedented With SMAC reaching nearly universal adoption, organizations opportunities coming from can no longer rely on these technologies alone to drive growth emerging and maturing or differentiation. The smartphone market is stalling. IDC’s Worldwide Quarterly Mobile Phone Tracker technologies, innovation 31 found that global smartphone shipments declined 4.1 percent from 2017 to 2018. 32 isn’t just about the next This continued into 2019: Q1 shipments were down from 2018 numbers by 6.6 percent. 33 In Q2, they were down 2.3 percent year over year. Only in Q3 did the industry see incremental step. It’s about an uptick, with shipments rising 0.8 percent year over year, ending nearly two years building the right DNA to of decline.34 turn the enterprise into an A recent report showed that 91 percent of organizations use social media platforms 35 engine for change. for marketing. However, social media user growth is starting to decelerate. After years of impressive growth, social media platforms saw just a one percent year-over-year increase between 2018 and 2019.36 NewVantage Partners’ 2019 Big Data and AI Executive survey found that data analytics 37 and big data investments are nearly universal across Fortune 1000 companies. Almost 92 percent of surveyed companies said they are increasing their pace of investment in big data and AI, and nearly 68 percent have appointed a Chief Data Officer. The RightScale 2019 State of the Cloud report, from Flexera, indicated that 94 percent of respondents use a cloud service, and 84 percent have a multi-cloud strategy.38
The imminent rise of DARQ technologies As scientific research drives new cross-industry has become undeniable as investments partnerships, organizations are recognizing and research initiatives increase. how important these advancements are for their long-term innovation strategies. Organizations are starting to see AI investment as a core part of their innovation strategies. In NewVantage Partners’ 2019 Big Data Rising demand for cleaner, greener and more powerful energy and AI Executive survey, 96 percent of participating companies said storage solutions is driving cross-industry investment in battery 39 they are investing in AI, compared to less than 70 percent in 2017. and energy grid innovation. In the first half of 2019, organizations And 80 percent said AI is their most important disrupter. invested $350 million in advanced lithium-ion technologies, 44 compared to $600 million for all of 2018. While much of the Growth is forecasted across DARQ technologies. IDC predicts demand comes from the electric car market, investments are that global spending on AI systems will grow at a CAGR of deriving from many other sources, including solar and wind 28 percent between 2018 and 2023, with spending by 2023 power companies and the US Department of Energy.45 40 reaching $97.9 billion. The industry analyst also forecasted 2019 blockchain spending of $2.7 billion—80 percent higher than Collaborative partnerships are also emerging in response to in 2018—and predicts the market to reach $15.9 billion in 2023.41 demand for smart materials in aerospace and defense, but the In AR and VR, spending is predicted to exceed $16 billion for 2019 value of this research could cross industries. According to Grand and $160 billion in 2023.42 View Research, the global market for smart materials is expected to reach $98.2 billion by 2025.46,47 Even in quantum—arguably the most nascent DARQ technology— investment has been growing rapidly. An analysis by Nature found in excess of $450 million in private funding for quantum technology companies in 2017 and 2018, separate from the efforts of major players like Google, Alibaba, IBM, Baidu and Hewlett Packard doing their own research.43
Deep Dive Evolving technology Today’s fast-moving world requires in-the- moment, individualized experiences and choice. But the technical architectures and architecture in patterns of the past are not built for these ephemeral conditions. When a technical component may only be the quest for needed for a short burst of time, and at a scale exponentially higher than the norm, efficiency demands dynamic and adaptable architectures innovation agility made up of APIs, microservices, containers and software-driven infrastructure.
This type of adaptability in architecture has But many enterprises have legacy systems A digital decoupling approach takes stock allowed leaders to realize innovation at scale holding them back from accessing the capabilities of where an organization’s legacy systems are across the enterprise and into new technology that would allow them to reinvent the business. creating bottlenecks or inefficiencies, then areas. Spotify built its adaptable architecture In an Accenture survey, more than 80 percent introduces different technological approaches using these technologies to support more than of respondents indicated they would like to to solve those issues. Businesses can run 200 million monthly active customers and replace all of their core legacy systems, but new technologies in parallel with their legacy 48 51 hundreds of billions of events per day. The remain dependent on them. And 83 percent systems—such as APIs, microservices, event- company has extended these interfaces to of respondents say technical debt—the flaws, driven architectures, DevSecOps, data lakes and support emerging technology channels like XR, complexities and inadequacies that make legacy more using Agile and domain-driven methodology creating a new way to interface with Spotify’s systems unfit for today’s business environment— approaches to manage the changes. With these music service in Magic Leap headsets.49 severely limits their organizations’ ability to be in place, companies can gradually migrate data innovative. Struggling to manage this debt takes and critical functionality, maximizing value. Other companies are radically reimagining how up time and investment that is needed to innovate, data is stored. A Microsoft Research project called limiting the opportunity to be a leader in these Goldman Sachs, for instance, built a platform “Project Silica” used recent ultra-fast laser optics future systems. called Marquee, which the company used to discoveries and machine learning to encode data decouple data from its respective data silos.52 50 into quartz glass. The glass is more resilient to Businesses challenged with legacy systems The platform combines transaction, research, environmental factors than traditional storage should focus on gradual, but targeted, technology market data and more into a data lake, and uses methods and is designed specifically for storage transition strategies that will help them build the machine learning algorithms to generate fresh and retrieval from the cloud. When Warner Bros. digital foundation they need to support today’s insights that guide decision-making. learned about it, the two companies collaborated constantly changing environment. This approach on the experiment’s first proof of concept—and will provide the basis for integration of DARQ successfully stored and retrieved the entire 1978 and future technologies. Superman movie.
While technical architecture is an often- overlooked component in the quest for business agility, it is one of the most urgent investments for companies looking to compete in the post-digital era. Digital decoupling is the architectural approach that will enable enterprises to unlock the speed and technology transformation they need to support continuous innovation at scale.
Decision Points How is your enterprise exploring Does your company have resources Which organizations are possible multiple fronts of innovation today? (time, space, people) dedicated to partners for co-innovation efforts? continuous innovation? Examine your current approaches to the three Seek out industry and ecosystem partnerships categories of innovation. Identify where your As your organization develops and refines to help your company establish a dedicated strengths are and what areas may be untouched. its innovation strategy, explore the potential innovation practice or oversee specific co-innovation of launching a dedicated innovation practice. projects. Your organization’s ability to innovate Set organizational goals and strategies that These practices can present a more straightforward around multiple innovation frontiers will depend build towards a comprehensive innovation DNA. way of exploring multiple innovation frontiers in on looking outward and understanding advances Grow existing efforts or stake out new areas a systematic fashion, while giving other groups that are happening. A strong set of partners across all three fronts. in your organization a resource when they are is necessary for this to succeed. Is your organization developing interested in a technology with future potential. an integrated innovation strategy? Gather input from internal groups to determine the breadth of each team’s innovation agendas. With this input, work with your organization’s leadership to recalibrate and reflect the shared goals of the various teams.
Bold Predictions 2 7 15 In two years In seven years In fifteen years An independent group of The largest user of CRISPR The majority of the world’s cold academics will announce technology will be the data will be stored through a quantum supremacy has agricultural and food industry. medium almost no organization been achieved. In six years, is using today, such as glass 65 percent of the Global or DNA. 2000 will have hired quantum computing specialists.
About the Technology Vision Every year, the Technology Vision team partners with Accenture Research to pinpoint the emerging IT developments that will have the greatest impact on companies, government agencies and other organizations in the coming years. These trends have significant impact across industries and are actionable for businesses today. The research process begins by gathering input from the As a shortlist of themes emerges from the research process, Technology Vision External Advisory Board, a group of more the Technology Vision team reconvenes its advisory board. than two dozen experienced individuals from the public and private The board’s workshop, a series of ‘deep-dive’ sessions with sectors, academia, venture capital and entrepreneurial companies. Accenture leadership and external subject-matter experts, In addition, the Technology Vision team conducts interviews with validates and further refines the themes. technology luminaries and industry experts, as well as nearly 100 Accenture business leaders from across the organization. These processes weigh the themes for their relevance to real-world business challenges. The Technology Vision team seeks ideas The research process also includes a global survey of thousands that transcend the well-known drivers of technological change, of business and IT executives from around the world, to understand concentrating instead on the themes that will soon start to appear their perspectives on the impact of technology in business. Survey on the C-level agendas of most enterprises. responses help to identify the technology strategies and priority investments of companies from across industries and geographies. In parallel, a consumer survey is conducted to understand the use and role of technology in people’s lives.
Survey demographics Business survey Accenture Research conducted a global survey of 6,074 business and IT executives to capture insights into the adoption of emerging technologies. The survey, fielded from November 2019 through January 2020, helped identify the key issues and priorities for technology adoption and investment. Respondents were C-level executives and directors at companies across 25 countries and 21 industries, with the majority having annual revenues greater than US$5 billion. 25 Countries 1 Argentina 10 Germany 19 Russia 2 Australia 11 India 20 South Africa 3 Austria 12 Indonesia 21 Spain 4 Brazil 13 Ireland 22 Switzerland 5 Canada 14 Japan 23 Thailand 6 Chile 15 Kazakhstan 24 United Kingdom 7 China 16 Mexico 25 United States 8 Columbia 17 Peru 9 France 18 Portugal
21 Industries Revenues Aerospace and Defense 1% 3% $50 billion or more Automotive 2% 10% $20-$49.9 billion Banking 11% 14% $10-$19.9 billion Chemicals 8% 26% $5-$9.9 billion Consumer Goods and Services 9% 45% $1-$4.9 billion 2% $250-$999 million Communications 9% Energy 4% Equipment Finance 1% Roles Freight and Logistics 2% Health 4% 50% Business Executives Industrial Equipment 1% 50% IT Executives Insurance 9% Life Sciences 2% Media 1% 8% Chief Information Officer 4% Chief Strategy Officer Metals and Mining 2% 2% Chief Mobility Officer 11% Director of Technology Public Service 11% 9% Chief Technology Officer 13% Director, IT Retail 9% 7% Chief Marketing Officer 15% Director of Business Function 8% Chief Finance Officer (Non IT-related) Semiconductors 1% 9% Chief Operating Officer 7% Director, Line of Business Software and Platforms 3% 3% Chief Security Officer (Non IT-related) Travel 7% 4% Chief Information Utilities 3% Security Officer
Consumer survey Between November and December 2019, Accenture Research surveyed 2,000 people in four countries with respondents representing different age and demographic groups. The survey asked consumers about their viewpoints and use of technology in their daily lives, including voice assistants, robots and connected products. Four Countries 1 China 2 India 3 United Kingdom 4 United States
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9 Lawler, R. (2019, February 14). Tesla Pushes Sentry Mode, Dog 20 Internet of Things Connected Devices Installed Base Worldwide from 30 Kuchler, H. (2019, June 4). Pharma Groups Combine to Promote Mode Updates to its EVs. Engadget: https://www.engadget.com/ 2015 to 2025. (2019, November 14). Statista: https://www.statista.com/ Drug Discovery with AI. Financial Times: https://www.ft.com/ 2019/02/14/tesla-sentry-dog-dashcam-autopilot statistics/471264/iot-number-of-connected-devices-worldwide content/ef7be832-86d0-11e9-a028-86cea8523dc2 10 Shi, A. (2018, September 8). Batterygate: A Complete History 21 AI Turns Ordinary Products into Industry Game-Changers. 31 New Research Consortium Seeks to Accelerate Drug Discovery of Apple Throttling iPhones. iFixit: https://www.ifixit.com/ (2018, April 20). Accenture: https://www.accenture.com/ Using Machine Learning to Unlock Maximum Potential of Pharma News/batterygate-timeline us-en/insights/industry-x-0/ai-transforms-products Industry Data. 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7 Meyersohn, N. (2019, April 9). Walmart Is Doubling Down on Robot 16 Etherington, D. (2019, July 10). Waymo Has Now Driven 26 New law bans electric scooters in San Francisco until Janitors. Here’s Why. CNN: https://www.cnn.com/2019/04/09/ 10 Billion Autonomous Miles in Simulation. TechCrunch: companies obtain city permits. (2018, June 4). ABC 7 News: business/walmart-robots-retail-jobs/index.html https://techcrunch.com/2019/07/10/waymo-has-now- https://abc7news.com/business/new-law-bans-electric- 8 Linder, C. (2018, October 30). Meet the 145-Foot Wide driven-10-billion-autonomous-miles-in-simulation scooters-in-san-francisco/3560740 Construction Robot from Hampton That Doesn’t Want to Steal Your Job. 17 Ho, V. (2019, April 4). Toyota Material Handling Group Innovates 27 Dickey, M. (2019, September 25). JUMP, Lime, Scoot and The Pittsburgh Post-Gazette: https://www.post-gazette.com/business/ Forklift, Factory, Service and Logistics Solutions with Digital Spin receive permits to operate scooters in SF. TechCrunch: tech-news/2018/10/28/advanced-construction-robotics-tybot-jeremy- Transformation. Microsoft Transform: https://news.microsoft.com/ https://techcrunch.com/2019/09/25/jump-lime-scoot-and- searock-stephen-muck-pittsburgh-cmu/stories/201806030005 transform/toyota-forklift-factory-logistics-digital-transformation spin-receive-permits-to-operate-scooters-in-sf 9 Black, T. (2019, July 13). New, More Agile Robots Speed the 18 O’Kane, S. (2019, August 15). UPS Has Been Quietly 28 Etherington, D. (2019, August 16). Postmates lands permit to Takeover of Jobs Once Done Only by Humans. The Los Angeles Times: Delivering Cargo Using Self-Driving Trucks. The Verge: test its Serve autonomous delivery robots in SF. 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35 Verghese, S. (2019, March 6). Bringing 3D perimeter 45 McBride, S. (2019, October 7). Now Is The Time To Load 54 Cadell, C. (2019, January 22). At Alibaba’s futuristic hotel, robots lidar to partners. Medium: https://medium.com/waymo/ Up On 5G Stocks. Forbes: https://www.forbes.com/sites/ deliver towels and mix cocktails. Reuters: https://www.reuters.com/ bringing-3d-perimeter-lidar-to-partners-6beaa7d3dcc2 stephenmcbride1/2019/10/07/now-is-the-time-to-load- article/us-alibaba-hotels-robots/at-alibabas-futuristic-hotel-robots- 36 Corrigan, J. (2019, May 3). FAA Predicts the Commercial Drone up-on-5g-stocks/#42358ecb103e deliver-towels-and-mix-cocktails-idUSKCN1PG21W Market Will Triple by 2023. Nextgov: https://www.nextgov.com/ 46 Reardon, M. (2018, October 22). 5G will unlock whole 55 Said, C. (2019, May 26). Kiwibots win fans at UC Berkeley as emerging-tech/2019/05/faa-predicts-commercial-drone- new applications—here are the most promising. CNET: they deliver fast food at slow speeds. San Francisco Chronicle: market-will-triple-2023/156743 https://www.cnet.com/news/a-look-at-5gs-most- https://www.sfchronicle.com/business/article/Kiwibots-win-fans-at- 37 68% of the world population projected to live in urban areas by promising-applications-for-now UC-Berkeley-as-they-deliver-13895867.php 2050, says UN. (2018, May 16). United Nations: https://www.un.org/ 47 Feiner, L. (2019, June 5). Amazon shows off its new warehouse robots 56 Bringing 5G-Enabled Robots to Retail. (2019, July 30). AT&T. https:// development/desa/en/news/population/2018-revision-of- that can automatically sort packages. CNBC: https://www.cnbc.com/ about.att.com/story/2019/att_and_badger_technologies.html world-urbanization-prospects.html 2019/06/05/amazon-shows-off-its-new-warehouse-robots.html 57 Looking for a 5G signal? Try this remote Scottish island. (2019, August 38 Global Takeaway & Delivery Multi Client Study. (n.d.). Technomic: 48 LeVine, S. (2018, June 13). In China, a picture of how warehouse jobs 8). The Economist. https://www.economist.com/britain/2019/08/08/ https://www.technomic.com/available-studies/multi-client-studies/ can vanish. Axios: https://www.axios.com/china-jd-warehouse-jobs- looking-for-a-5g-signal-try-this-remote-scottish-island global-takeaway-delivery 4-employees-shanghai-d19f5cf1-f35b-4024-8783-2ba79a573405.html 58 Shen, J. (2019, July 29). Chongqing steps up robotaxi push with 39 Berman, J. (2019, October 11). Pitney Bowes Parcel Shipping 49 Root, A. (2019, February 19). What Robots Mean for the Future launch of 5G-enabled testing zone. TechNode. https://technode. Index highlights strong growth for global parcel volumes. Logistics of American Manufacturing. Barron’s: https://www.barrons.com/ com/2019/07/29/chongqing-robotaxi-5g-testing/ Management: https://www.logisticsmgmt.com/article/pitney_bowes_ articles/robots-american-manufacturing-51550431888 parcel_shipping_index_highlights_strong_growth_for_global_parc 50 Record Number of Robots Shipped in North America in 2018, With 40 Nichols, G. (2019, August 7). Amazon delivery robots are officially More Installed at Non-Automotive Companies Than Ever Before. (2019, Trend 5: Innovation DNA on the streets of California. ZDNet: https://www.zdnet.com/article/ February 28). Robotic Industries Association: https://www.robotics.org/ amazon-delivery-robots-are-officially-on-the-streets-of-california content-detail.cfm/Industrial-Robotics-News/Record-Number-of- 41 Twentyman, J. (2018, August 31). Manufacturing: How Robotics Robots-Shipped-in-North-America-in-2018-With-More-Installed-at- 1 Wilson, K. (2019, July 12). Fujitsu’s Vancouver Office is Breaking as a Service extends to whole factories. Internet of Business: Non-Automotive-Companies-Than-Ever-Before/content_id/7756 Boundaries with its Quantum-Inspired Tech. The Georgia Straight: https://internetofbusiness.com/how-robotics-as-a-service- 51 Daniel, D. (2019, March 17). Global mining giants pick https://www.straight.com/tech/1265556/fujitsus-vancouver- is-extending-to-whole-factories-analysis autonomous trucks to cut costs. Construction Week Online: office-breaking-boundaries-its-quantum-inspired-tech 42 Craven, C. (2019, September 24). The Top Countries with 5G https://www.constructionweekonline.com/products- 2 Case Study: Fujitsu IT Products. (2018, December 16). Fujitsu Digital Deployments and Trials. SDxCentral: https://www.sdxcentral.com/ services/169830-autonomous-trucks-vehicles-and-machines- Annealer: https://www.youtube.com/watch?v=EMl-og79sZ8 5g/definitions/the-top-countries-with-5g-deployments-and-trials show-benefits-for-worlds-largest-mining-companies 3 Services: Fujitsu Global. (n.d.): 43 Koetsier, J. (2019, August 22). 5G Milestone: Korea’s SK Telecom 52 Autonomous Tractors – The Future of Farming? https://www.fujitsu.com/global/digitalannealer/services First to Pass 1M Subscribers. Forbes: https://www.forbes.com/sites/ (2018, January 18). Big Ag: http://www.bigag.com/ 4 Loten, A. (2019, July 9). Our IT Is So Good, Let’s Sell It, Firms Say. johnkoetsier/2019/08/22/global-first-koreas-sk-telecom-breaks- topics/equipment/autonomous-tractors-future-farming The Wall Street Journal: https://www.wsj.com/articles/our-it-is- 1-million-5g-subscriber-mark/#2b2427093121 53 The New Holland NHDrive Concept Autonomous Tractor so-good-lets-sell-it-firms-say-11562664603 44 Study on Socio-Economic Benefits of 5G Services Provided in Shows a Vision into the Future of Agriculture. (2016, August 30). 5 Lucas, A. (2019, July 22). Starbucks Licenses its ‘Gold Standard’ mmWave Bands. (2018, December). 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6 Spangler, T. (2019, November 13). Disney Says Disney Plus 15 Indigo Agriculture and Anheuser-Busch Partner to Meet 25 Black, S. (2019, January 31). Thermoplastic Door Has Over 10 Million Sign-Ups After Launch Day. Variety: Sustainability Goals for Rice Production. (2019, March 11). A First for Automotive Composites. CompositesWorld: https://variety.com/2019/digital/news/disney-says-disney- Indigo Ag: https://www.indigoag.com/pages/news/ https://www.compositesworld.com/blog/post/thermoplastic- plus-has-over-10-million-signups-1203403515 indigo-partners-with-anheuser-busch-for-sustainable-rice door-a-first-for-automotive-composites 7 Gupta, R. (2019, August 27). Disney+ Streaming 16 Indigo Microbial Science. (n.d.): 26 Etherington, D. (2019, August 21). Waymo Releases Service Is A Direct Challenge to Netflix. Market Realist: https://www.indigoag.com/indigo-microbial-science A Self-Driving Open Data Set for Free Use by the Research https://marketrealist.com/2019/08/disney-streaming- 17 Rubin, P. (2019, July 18). Disney’s New Lion King Is the Community. TechCrunch: https://techcrunch.com/2019/08/21/ service-is-a-direct-challenge-to-netflix VR-Fueled Future of Cinema. Wired: https://www.wired.com/ waymo-releases-a-self-driving-open-data-set-for-free-use- 8 White, J. (2018, April 7). James Dyson on Batteries, Electric Cars story/disney-new-lion-king-vr-fueled-future-cinema by-the-research-community and the Future of Design. Wired: https://www.wired.co.uk/article/ 18 Van Boom, D. (2019, August 18). Lion King Remake Is the 9th Highest- 27 Etherington, D. (2019, July 23). Lyft Opens to the Public Autonomous james-dyson-wired-interview-electric-batteries-cars-design Grossing Film Ever. CNET: https://www.cnet.com/news/lion-king- Driving Data Set from its Level 5 Self-Driving Fleet. TechCrunch: 9 Roberson, B. (2019, May 29). Can the Dyson Vacuum Cleaner remake-is-the-9th-highest-grossing-film-ever https://techcrunch.com/2019/07/23/lyft-opens-autonomous- Guy Build A Better Electric Car Than Tesla’s Elon Musk? Forbes: driving-dataset-from-its-level-5-self-driving-fleet-to-the-public https://www.forbes.com/sites/billroberson/2019/05/29/can- 19 The Walt Disney Studios StudioLAB Advances the Art of Storytelling 28 Boudette, N., and Ewing, J. (2019, July 12). Ford and VW Agree to the-dyson-vacuum-cleaner-guy-build-a-better-electric-car- Through Next-Generation Technology. (2018, July 16). The Walt Disney Share Costs of Self-Driving and Electric Cars. The New York Times: than-teslas-elon-musk/#5a2e662411c2 Company: https://www.thewaltdisneycompany.com/the-walt-disney- https://www.nytimes.com/2019/07/12/business/ford-vw-self- studios-studiolab-advances-the-art-of-storytelling-through-next- driving-electric-cars.html 10 Dyson Electric Car Patents Filed, Testing to Ramp Up in June. generation-technology (2019, May Dyson Automotive Update. (2019, May). The Straits 20 Roettgers, J. (2018, September 13). Inside Disney’s StudioLab, Where 29 Wiggers, K. (2019, September 17). Pinterest’s Lens Can Now Times: https://www.straitstimes.com/world/united-states/ the Company Tests and Previews Cutting-Edge Technology. Variety: Recognize 2.5 Billion Home and Fashion Objects. VentureBeat: dyson-electric-car-patents-filed-testing-to-ramp-up-in-june https://variety.com/2018/digital/news/disney-studiolab-inside- https://venturebeat.com/2019/09/17/pinterests-lens-can-now- 11 Dyson Automotive Update. (2019, October 10): look-1202940482 recognize-2-5-billion-home-and-fashion-objects https://www.dyson.com/automotive.html 21 The Kraft Heinz Company Opens a New Digital Hub. (2018, November 30 Machkovech, S. (2019, September 25). Oculus Announces 12 Etherington, D. (2019, June 17). Domino’s Serves Up 5). Kraft Heinz press release: https://news.kraftheinzcompany.com/ Plans to Build Augmented Reality Glasses. ArsTechnica: Self-Driving Pizza Delivery Pilot in Houston. TechCrunch: press-release/corporate/kraft-heinz-company-opens-new-digital-hub https://arstechnica.com/gaming/2019/09/oculus-announces- https://techcrunch.com/2019/06/17/dominos-serves-up- plans-to-build-augmented-reality-glasses self-driving-pizza-delivery-pilot-in-houston 22 White, M. (2018, November 6). Kraft Heinz Opens Digital Hub After 31 Smartphone Woes Continue with Worldwide Shipments Down Acquiring AI Firm Wellio. FoodBev Media: https://www.foodbev.com/ 4.9% in the Holiday Quarter Capping off the Worst Year Ever, 13 AI and Robotics in the Lab: Accelerating Materials news/kraft-heinz-opens-digital-hub-after-acquiring-ai-firm-wellio According to IDC. (2019, January 30). IDC. (Doc #prUS44826119): Discovery. (2019, March 25). MIT Technology Review: 23 Locker, M. (2019, June 1). Inside the Secret Laboratory Where https://www.idc.com/getdoc.jsp?containerId=prUS44826119 https://events.technologyreview.com/video/watch/ Marriott is Cooking Up the Hotel of the Future. Fast Company: jill-becker-accelerating-materials-discovery https://www.fastcompany.com/90350173/inside-the-innovation- 32 Smartphone Shipments Experience Deeper Decline in 14 Knight, W. (2018, November 7). A Robot Scientist Will Dream lab-where-marriott-is-creating-the-hotel-room-of-the-future Q1 2019 with a Clear Shakeup Among the Market Leaders, Up New Materials to Advance Computing and Fight Pollution. According to IDC. (2019, April 30). IDC. (Doc #prUS45042319): MIT Technology Review: https://www.technologyreview.com/ 24 Baldwin, R. (2018, September 4). Polestar Wants to Change https://www.idc.com/getdoc.jsp?containerId=prUS45042319 s/612388/a-robot-scientist-will-dream-up-new-materials- Almost Everything About How You Own A Car. Engadget: 33 Smartphone Shipments Decline 2.3% in the Second to-advance-computing-and-fight-pollution https://www.engadget.com/2018/09/04/polestar-wants- Quarter on Continued Challenges Across Most Major Regions, to-change-almost-everything-about-how-you-own-a-c According to IDC. (2019, July 31). IDC. (Doc #prUS45414919): https://www.idc.com/getdoc.jsp?containerId=prUS45414919
34 Worldwide Smartphone Shipments Rise by 0.8% in the 44 Advanced Lithium-Ion Technologies on Track for Record Third Quarter as Huawei Went Full Steam in China, According Annual Investment. (2019, October 28). Wood Mackenzie: to IDC. (2019, November 7). IDC. (Doc #prUS45636719): https://www.woodmac.com/press-releases/advanced-lithium- https://www.idc.com/getdoc.jsp?containerId=prUS45636719 ion-technologies-on-track-for-record-annual-investment 35 Guttmann, A. (2019, May 13). Social media marketing 45 Department of Energy Announces $120 Million for Battery usage rate in the United States from 2013 to 2019. Statista: Innovation Hub. (2018, September 18). U.S. Department of Energy: https://www.statista.com/statistics/203513/usage- https://www.energy.gov/articles/department-energy-announces- trands-of-social-media-platforms-in-marketing 120-million-battery-innovation-hub 36 Meeker, M. (2019, June 11). Internet Trends 2019 [slide 164]. 46 Jorgensen, B. (2019, April 8). Aerospace & Defense Expected to Bond Capital: https://www.bondcap.com/report/itr19/#view/164 Drive Smart-Materials Demand. EE Times: https://www.eetimes.com/ 37 Big Data and AI Executive Survey 2019: Executive Summary document.asp?doc_id=1334534 of Findings. (2019). NewVantage Partners: http://newvantage.com/ 47 Smart Materials Market to Gain Boost Owing to Enhanced Demand wp-content/uploads/2018/12/Big-Data-Executive-Survey-2019- of Sensors and Actuators From Aerospace & Defense Sector Till 2025. Findings-Updated-010219-1.pdf (2019, March 6). PR Newswire: https://www.prnewswire.com/news- 38 Cloud Computing Trends: 2019 State of the Cloud Survey. releases/smart-materials-market-to-gain-boost-owing-to-enhanced- (2019, February 27). Flexera: https://www.flexera.com/blog/cloud/ demand-of-sensors-and-actuators-from-aerospace--defense-sector- 2019/02/cloud-computing-trends-2019-state-of-the-cloud-survey till-2025--million-insights-300807489.html 39 NewVantage Partners. (n 7) 48 Janota, B., and Stephenson, R. (2019, November 12). Spotify’s Event Delivery – Live in the Cloud. Spotify Labs: https://labs.spotify.com/ 40 Worldwide Spending on Artificial Intelligence Systems 2019/11/12/spotifys-event-delivery-life-in-the-cloud Will Be Nearly $98 Billion in 2023, According to New IDC 49 Porter, J. (2019, November 13). Spotify’s Magic Leap Spending Guide. (2019, September 4). IDC. (Doc #prUS45481219): App Will Change Playlists as You Change Rooms. The Verge: https://www.idc.com/getdoc.jsp?containerId=prUS45481219 https://www.theverge.com/2019/11/13/20962662/spotify- 41 New IDC Spending Guide Sees Strong Growth in magic-leap-app-music-streaming-augmented-reality Blockchain Solutions Leading to $15.9 Billion Market 50 Langston, J. (2019, November 4). Project Silica Proof of Concept in 2023. (2019, August 8). IDC. (Doc #prUS45429719): Stores Warner Bros. ‘Superman’ Movie on Quartz Glass. Microsoft https://www.idc.com/getdoc.jsp?containerId=prUS45429719 Innovation Stories: https://news.microsoft.com/innovation-stories/ 42 Commercial and Public Sector Investments Will Drive Worldwide ignite-project-silica-superman AR/VR Spending to $160 Billion in 2023, According to a New 51 Embrace Digital Decoupling. (2018, September 13). Accenture: IDC Spending Guide. (2019, June 4). IDC. (Doc #prUS45123819): https://www.accenture.com/us-en/insights/us-federal-government/ https://www.idc.com/getdoc.jsp?containerId=prUS45123819 embrace-digital-decoupling 43 Gibney, E. (2019, October 2). Quantum Gold Rush: 52 Exponential IT: Unlock Agility, Innovate at Speed. (2018, February 26). The Private Funding Pouring into Quantum Start-Ups. Nature: Accenture: https://www.accenture.com/us-en/insight-exponential-it https://www.nature.com/articles/d41586-019-02935-4
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