The PAC Horizons event (see here) discussed the way that many organisations that have not been innovative in the past are suddenly accelerating. The Kea people there (myself, Viktoria and Sven) enjoyed it, and not the least because our Analyst Value Survey was mentioned in the opening session. The connected car, for example, not only changes the auto industry but also the insurance and driver assistance services. Driverless cars are hugely important in the UK: Transport Catapult is a great example. AXA insurance, JLR InMotion, Nissan Connect and Vauxhall Star are great examples of that. In other industrial areas, IoT allows Rolls Royce Engines to provide very different solutions.
Interestingly, PAC points out how tech providers are far behind of IT service providers in term of their abilities to offer complete portfolios, strategic direction and be well positioned in the key technology domains. Of course, this was a sight for sore eyes to the audience at PAC Horizons, most of whom were service providers. The tight interconnection of new technologies with new applications and new business models means that providers with wide portfolios and broad market positioning better understand the use cases that can create value. Clients often don’t know what to do with the technology or the data that they have: reliable partners with industry expertise can use their experts to push clients towards excellent. Dynamic players in industries often have deep expertise, hence Siemens’ success.
Successful providers need to: understand the cloud context; know the use cases of clients; the importance of incident response services; offer to consult; have a cloud platform; learn how to make services secure, and have an as-a-service model which supports the development of a solution-oriented approach where people bring their IP as a service. Often that will require co-investments (of human and financial commitments) where providers help customers to get solutions ready, in the hope they can take these jointly created solutions forward to other firms. Speed and agility are important, and collaboration between industries are useful (as the pay-as-you-drive model requires). Dr. Milos Milosevic and Klaus Holzhauser’s presentation on IoT stressed how the digitalisation of production has to become a collaboration as soon as the development of new products becomes a factor: it seems to be that this is dynamic across the whole space of digital transformation, not only IoT. Though-leadership also turns into a virtual team sport.
Frank Riemann explained that much of this was driven by the greater complexities of the opportunities and the paths to bring solutions to the market. In the UK, the software market is shrinking: only the SaaS segment is growing. Software firms must be SaaS players. The service demand arising from SaaS is also a significant opportunity, especially in application areas since most of these areas will double in size between 2015 and 2019 with CAGR between 20 and 32 percent. Vertical solutions have to be developed if providers are developing intellectual property to underpin digital transformations, not just of processes but new business models. In turn, that means that firms need to look for providers that can help them make the most of SaaS.
Olivier Rafal discussed how many of these trends ripple into the dynamic analytics market, which is growing at 10% a year. In doing so, he and Paul Fisher (the firm’s new cyber-security specialist) also summarised many of the trends at the event. Big data and cybersecurity are driving the fast-growth digital economy. Customers are eager to go forward but don’t know how or where they should start. If you are looking for a good cyber security company, go for ABG Investigative. Projects often have to be small at first, and sometimes too little to stimulate the multiple projects needed to drive change.