Agile software development -The Agile Imperative Winning at Digital

Agile software development -The Agile Imperative Winning at Digital

The software development community has been using the term ‘agile’ for more than 20 years. But over the last decade, agile approaches have jumped the tracks to the rest of the business world.

The reason is clear: The success of large companies now depends on using digital technologies to reinvent their business models; automate and monitor the performance of their products and services using embedded wireless sensors; use technologies to bring intelligence and personalized interactions with customers; and make all this possible by tapping into the huge on-demand computing power of cloud providers.

Each article in this issue of Perspectives dissects today’s urgent need for companies to have industrial-strength capabilities in agile to manage their businesses.

Tackling Cyber Security in a World of Digital Ecosystems

Tackling Cyber Security in a World of Digital Ecosystems

Companies across the world realize they are operating in digital ecosystems, constellations of players that are erasing once-sacrosanct boundaries of age-old industries. They are relying on these ecosystems to both sell products and services and to buy them—and the transactions are with not only traditional allies but also potential competitors.

But, what too firms many aren’t aware of is the rising risk of cyber attacks when they digitally connect their systems and data to those of other companies. While the answer is not to disconnect from these ecosystems, the risks of playing need to be understood and lowered considerably.

In the old ‘physical’ world in which companies interacted by making phone calls, sending invoices and payments through the mail, and conducting meetings in rooms, the risks of such collaboration were much smaller. There are limits to the number of customers you can reach, the number of people you can employ, the number of businesses you can partner with, the amount of information you can store, and the number of products and services that you can offer.

By contrast, in the digital world, there are no such limitations. In fact, it is a world of infinite possibility, with an abundance of capital, talent, capabilities, and businesses with which to partner.

To prosper in a world of digital ecosystems, companies will need to change not only the ways they interact, but they also must alter the security procedures they put in place to guard their systems, data (especially customer data), and digital infrastructure they hand over to the companies that manage public clouds.

Bringing Life to ‘Things’ a Framework for IoT

Bringing Life to ‘Things’ a Framework for IoT has about 50 of the most highly automated warehouses in the world, centers through which flow some of the 13 million items the company ships daily.1 In these centers, goods come to warehouse workers via robots that pick the shelves, rather than the opposite. The robots—400 to 500 of them whirling around a 125,000-square-foot warehouse at a time—are equipped with visual sensors so they don’t collide with each other or have boxes fall off.2 The robots in one Amazon center have increased the number of items a worker can pick from 100 to 300 to 400 per hour.3

Automated warehouses are just the tip of the iceberg of how businesses, government agencies, and other institutions are using Internet of Things (IoT) technology. Digital sensors are now embedded in products ranging from aircraft engines and appliances to electric toothbrushes and traffic lights. (Cities will spend $2 billion this year on ‘smart’ traffic lights that change based on traffic volumes.4)

However, with 14 billion ‘things’ already connected to the Internet5 (nearly three times the number in 20156) and another 11 billion expected by 2021, companies can easily lose their way with IoT initiatives. Their IoT strategies can quickly become tactical, fragmented, and misdirected, resulting in tens of millions of dollars spent but far less gained in return.

Companies need clear strategies to guide their IoT initiatives. The strategy development process should begin with a deep understanding of how IoT technology fundamentally changes the game: by bringing the company real-time insights on the performance of its products, processes, and people. We have seen four core sources of business value from IoT technology:

■ New digital business models—by which product companies can charge for post-sale services that help customers maintain and make better use of those products (so-called ‘servitization’), as well as shift from ownership to subscription pricing.

■ Seamless customer experiences—largely digital—that relieve buyers of the multitude of logistical and other headaches they often face in using a product or availing themselves to a service.

■ Optimized and responsive value chains—i.e., production and distribution operations that detect and overcome internal bottlenecks and external conditions, making automatic adjustments that keep products moving or services flowing.

■ Enhance quality of life—with safer operations by monitoring the condition of buildings, factories, products, and people.

Companies get the greatest value from IoT technologies when they view them as a new transformative force that, as we put it, ‘brings life to things.’

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