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Digital Impact From Systems of Recordto Systems of Engagement DigitalNow! April 26, 2012

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Technology Megatrends Decades of Disruption to Business as Usual • 1980s • Personal Computing, Office Automation • B2E - documents, presentations, financial analysis • 1990s • Internet, ERP, Worldwide Web • B2B – outsourcing, globalization, business networks • 2000s • Broadband, Mobile, Social Media • B2C – media & entertainment, communication, branding • 2010s • Digital commerce, Collaborative Systems • B2B2C – advertising, retail, customer service2

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Two Types of Business Network O CYOU Collaborative Coordinated Networks Networks • High complexity • High volume • Relationship oriented • Transaction oriented • Outgrowth of project teams • Outgrowth of value chains • Organize around an • Organize around a orchestrator concentrator • Focus: expertise, innovation, • Focus: efficiency, speed, and market development and adaptability Disney Films Disney Theme Parks

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Two Types of IT Leverage O CYOU Collaborative Coordinated Networks Networks • High complexity • High volume • Relationship oriented • Transaction oriented • Outgrowth of project teams • Outgrowth of value chains • Organize around an • Organize around a orchestrator concentrator • Focus: expertise, innovation, • Focus: efficiency, speed, and market development and adaptability SYSTEMS OF SYSTEMS OF ENGAGEMENT RECORD New Familiar Idea Idea

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Systems of RecordThe Story of Enterprise IT in the 20th Century• Transaction systems for global commerce . . . • Financials, Order Processing, Inventory, HR, CRM, Supply Chain • Mainframes, minis, client-server, PC, Internet-enabled, SaaS• Drove three decades of investment • Databases are at the center of these systems • OLTP and Business Intelligence have been the key drivers • Network is seen primarily as a transport mechanism• Y2K put the capstone on this trend • Pulled forward a half decade of investment • Enterprise IT has had to go through a long “digestive” period • Focus in past decade has been on efficiency investments

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IT Innovation: 2000 to 2010 Enterprise IT Consumer IT On a Diet On Fire

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Redefining IT for ConsumersThe Digitization of Human Culture • Access • Infinite content, no barriers to entry, no barriers to exit • Communications are globally democratized • Microsoft, Google, Facebook, Wikipedia, OpenTable • Broadband • Pictures, video, shopping • Internet touches both the mind and the heart • Skype, iTunes, YouTube, Hulu, Netflix, Zappos • Mobile • PC for the emerging markets • iPhone and iPad set the bar in mature markets • IM, email, camera, game, wallet, magazine. . . even a phone! How will this impact enterprise IT?

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B-2-B “Enterprization” of Consumer IT:Investing in Collaborative Systems ofEngagementburden falls on the middle of the organization • Collaboration • Not front-line workers engaged in transactional workflows • Not top executives engaged in strategic issues• Need to invest in “IT for the middle tier” • In-the-moment empowerment through Systems of Engagement • On-demand access to Systems of Record as required• Systems of Engagement must meet four key design goals: • Mobile to be in the moment • Social to share facts and insights with others • Ad Hoc because that’s how issues emerge • Real Time because that’s when issues get resolved

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Enterprise Systems of Engagement Who knowsCommunication & Collaboration the head of BD at IBM?Can you help me promote this in • Enterprise Facebookmy community? • Enterprise YouTube How much did we spend on Let’s make sure • Enterprise Search this last year?everyone registers for this in the • Enterprise App Store same way! Let’s keep the • Enterprise Twitter buzz going! • On demand conferencing We need all hands on deck, • Global presence detection right now! I need to talk • Mobile access to everything to Sherry— where is she? • Social content management Let’s look at the data and • With more revolutionary What is the sentiment on get Larry to applications to come . . . . this in our walk us thru it community? This is the “enterprise-ation” of consumer IT

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Technology Disruptions When Will Your Organization Make the Transition? MAIN STREET TORNADO EARLY MARKET BOWLING CHASM ALLEY ive y ist ty ar rs rs s at it s) a t ori d rv or on te s) to s) ar ie isi op se aj gm aj a gg ov on M ra M Ad La (C t e n (P l y In ly La r (V Ea r Ea10

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Adoption Dynamics How Will the Transition Unfold? Power Performance Gear Gear Virality? How many? Churn? ENLISTMENT ACQUISITION How soon? Starter MotorPerformance Power Gear Gear What ROI? MONETIZATION ENGAGEMENT How often? What IRR? How much?11

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Focusing to Accelerate AdoptionWhere Should the Transformation Start?• Every customer-facing strategy is made or broken during a handful of moments of engagement—what are yours?• What person or system represents you in these moments, and how effective are you at meeting the new expectations?• Where could you introduce systems-of-engagement capabilities to amplify your organization’s power at these specific moments? Use these questions to target your first project on a moment that matters

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Final Takeaway: A To-Do List How Could I Go About Putting This into Effect? 1. Review your strategy and identify your top-priority moments of engagement. 2. Determine what systems of engagement would have the biggest impact on your effectiveness in these moments 3. Assess your organization’s Technology Adoption style and calibrate your ambitions accordingly 4. Identify your early adopters and recruit them to this effort 5. Engage with outside help to design and prototype your first systems of engagement effort 6. Focus on user experience as your critical acceptance criterion 7. Use anecdotal feedback from early adopters to create the case for crossing the chasm to widespread pragmatist adoption 8. Focus the pragmatist investment case on a critical pain point, and do whatever it takes to put that issue to bed13

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gmoore@geoffreyamoore.com14