1.
DIGITAL TRANSFORMATION
Sotiris Syrmakezis
Lecture at the University of Cyprus, Centre for Entrepreneurship
Nicosia, 30 January 2019

2.
“Right now, a Masai warrior
on a mobile phone in the
middle of Kenya has better
mobile communications
than the U.S. president did
25 years ago.
If he’s on a smart phone
using Google, he has
access to more information
than the U.S. president did
just 15 years ago.”
Peter Diamandis, author of
“Abundance”

3.
Internet of Things
“If you think that the internet has changed your life, think
again. The IoT is about to change it all over again!”
Brendan O’Brien, Chief Architect & Co-Founder, Aria Systems
Experts Exchange, Processing Power Compared

4.
Sotiris Syrmakezis
Processing Power | Today’s smartphones are what used to be considered supercomputers
Experts Exchange, Processing Power Compared
1969 1985 1985 2010

5.
Sotiris Syrmakezis
2015 2000
Processing Power | Today’s supercomputers
Experts Exchange, Processing Power Compared
2015 2010

6.
Sotiris Syrmakezis
Storage over time
Experts Exchange, Processing Power Compared

7.
Sotiris Syrmakezis
Moore’s Law and the 5th paradigm of exponential growth

8.
TECHNOLOGY “The strongest force propelling human progress has been
the swift advance and wide diffusion of technology.”
The Economist

9.
1
2
3
VIRTUAL AND
AUGMENTED REALITY
4
5
6
7
8
ARTIFICIAL INTELLIGENCE
ROBOTICS
SMARTPHONES
ICT
CRYPTOCURRENCIES
& BLOCKCHAINS
INTERNET OF THINGS
SENSORS
3D PRINTING
BIG DATA &
ADVANCED ANALYTICS
BIOTECH & NEUROTECH
NANOTECH
8 exciting technologies that will change banking (and the world)

10.
Sotiris Syrmakezis
WARNING
We tend to overestimate
the effect of a technology in
the short run an
underestimate its effect
in the long run

11.
BLOCKCHAIN
By 2022, a blockchain-based business will be worth $10 billion
Gertner Prediction, Nov 2016
6

12.
ARTIFICIAL
INTELLIGENCE
By 2020, the average person will have more
conversations with bots than with their spouse
Gartner Assumption, Nov. 2016
5

13.
“HELLO WORLD” by IAMUS COMPUTER CLUSTER &
MELOMICS ALGORITHM

14.
Artificial Intelligence | Artistic Style Transfer
Computer Vision Foundation, Image Style Transfer Using Convolutional Neural Networks, 2016

15.
UBER AUTONOMOUS FLEET

16.
GOOGLE AUTONOMOUS FLEET

17.
GOOGLE SELF-DRIVEN CAR

18.
Sotiris Syrmakezis
AI: chatbots in action today

19.
Sotiris Syrmakezis
Apple Siri, the early days…

20.
Sotiris Syrmakezis
Apple Siri, mature version…

21.
Mobile Devices Pocket Supercomputers
1

22.
Sotiris Syrmakezis

23.
Sotiris Syrmakezis
Coronation of Pope Benedictus
Before the smartphone era…

24.
Sotiris Syrmakezis
Coronation of Pope Franciscus
…and after that

25.
Sotiris Syrmakezis
Social media used in revolutions
Social Media Tahrir Square, Cairo, 2011

26.
Sotiris Syrmakezis

27.
Sotiris Syrmakezis

28.
Sotiris Syrmakezis
82%
consult their phones
on purchases they’re
about
to make in a store
“How mobile has redefined the consumer decision journey for shoppers”, July 2016,
ThinkWithGoogle.com
1 in 3
have purchased from a
company or brand
other than the one they
intended to
because of information provided in
the moment they needed it
Smartphone users
Consumers in the Micro-Moment, Wave 3, Google/Ipsos, U.S., August 2015,
n=1291 online smartphone users 18+

29.
Sotiris Syrmakezis
The economics of Digital
Digital competition shrinks value. Customers win, and companies lose. Products/services become obsolete, and value
pools consolidate.
McKinsey & Co.: Why digital strategies fail, January 2018
DD

30.
Internet of Things
“If you think that the internet has changed your life, think
again. The IoT is about to change it all over again!”
Brendan O’Brien, Chief Architect & Co-Founder, Aria Systems

31.
Sotiris Syrmakezis
The Internet of Things is on our body

32.
Sotiris Syrmakezis
The human body is the next computer interface

33.
Sotiris Syrmakezis
The Internet of Things is in our homes

34.
Sotiris Syrmakezis
Tens of billions of connected devices
By 2025, some 20 billion devices will be connected, nearly three
times the world population
Over the past two years, such devices have churned out 90
percent of the data ever produced.
Why digital strategies fail, McKinsey & Co., Jan 2018

35.
Sotiris Syrmakezis
More connected devices than people
Source: Cisco

36.
Sotiris Syrmakezis
IoT: significant cybersecurity issues

37.
Sotiris Syrmakezis
IoT: significant cybersecurity issues
54% of surveyed companies*
experienced an industrial control
system security incident within the
past 12 months
* Business Advantage State of Industrial Cybersecurity, 2017
Only 28% of those** consider their IoT
security strategy to be “very important”
More than 33% think it’s only “somewhat
important”, or “not important at all”
61% of those surveyed**
have already experienced an
IoT security incident
Annual fraud rates are now costing
over £3 trillion a year***
** Trustwave Report, 2018 *** Infosecurity Magazine, 2018
64% of surveyed organizations**
have deployed IoT devices
20% plan to do so in a year
&

38.
The future of
workforce
“65% of children entering the 1st grade of
primary school will work in jobs that do not
exist today”
Gartner Strategic Assumption, 2016

39.
HUMAN vs. SOFTWARE ROBOT

40.
Impact on workforce: job types at risk
Source: McKinsey & Co.
Grey lines represent average per activity across all sectors

41.
Impact on workforce: emerging and declining jobs

42.
It is much easier to imagine jobs that will go away than new jobs that will be created.
Today millions of people work as app developers, ride-sharing drivers, drone operators, and social media marketers.
Jobs that didn’t exist and would have been difficult to even imagine ten years ago.
Impact on workforce: new jobs replace the old

43.
Impact on workforce: wages

44.
Sotiris Syrmakezis
The Millennials

45.
Sotiris Syrmakezis
Millennials technology
0%
10%
20%
30%
40%
50%
60%
Play video games IM / Chat Download
Music/Video
Use Social Media Watch TV Online
Millennials Gen X Boomers
Goldman Sachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016

46.
Sotiris Syrmakezis
Millennials: they spend more on experiences
JP Morgan Chase & Co. | State of the US Consumer | Barclays Global Financial Services Conference, Sep 2016

47.
Sotiris Syrmakezis
Millennials: they are developing a “healthy lifestyle”
Goldman Sachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016 OECD, Economic Outlook and Interim Economic Outlook, Sept. 2016

48.
Sotiris Syrmakezis Goldman Sachs | Our Thinking | Macroeconomic Insights | Data Story: Millennials, 2016
Millennials: the largest generation in history

49.
Sotiris Syrmakezis
Aging population…
OECD, Economic Outlook and Interim Economic Outlook, Sept. 2016

50.
Sotiris Syrmakezis
…plus Public Budget constraints…
…means that
people will work longer…
…and they will be
today’s millennials
OECD, Economic Outlook and Interim Economic Outlook, Sept. 2016

51.
Sotiris Syrmakezis
53%
don’t think their bank offers
anything different than others
1 in 3
are open to switching banks
in the next 90 days
Millennials and Banking
“The Millennial Disruption Index”, Viacom Media Networks, 2013
33%
believe they won’t need
a bank at all

52.
DIGITAL
TRANSFORMATION
“It’s no longer the big beating the small, but the fast
beating the slow.”
Eric Pearson, CIO, International Hotel Group (IHG)

53.
WTF is digital
transformation
Sotiris Syrmakezis

54.
…is like teenage sex:
- Everyone talks about it
- Nobody really knows how to do it
- Everyone thinks that everyone else is already doing it
- So, everyone claims they’re doing it
Dan Ariely (paraphrased)
Digital Transformation…
Sotiris Syrmakezis

55.
Digital Transformation…
If you can’t explain it simply,
you don’t understand it well enough
Albert Einstein
Όσο πιο καλά τα ξέρεις,
τόσο πιο απλά τα λες
Πέτρος Αμπαζής

56.
Digital Transformation…
Digitization Digitalization Digital Transformation
the conversion of analog
information into digital form
the actual process of the
technologically-induced change
(digitization) within industries
the total and overall societal effect of
digitalization
transform and change:
• existing business models,
• consumption patterns,
• socio-economic structures,
• legal and policy measures,
• organizational patterns,
• cultural barriers
Sotiris Syrmakezis
Conversion, process and effect
accelerate and illuminate the already existing and
ongoing horizontal and global processes of
change in society

57.
Sotiris Syrmakezis
Largest taxi company / no vehicles
Most popular media owner / no content
Most valuable retailer / no inventory
Largest accommodation provider / no real estate
New business models disintermediate existing ones

58.
Sotiris Syrmakezis
The sharing economy (+ the reputation economy)
PwC, Sharing Economy: sizing the revenue opportunity
x 22.3
x 1.4

59.
Sotiris Syrmakezis
The economics of Digital
Disruption is always dangerous, but digital disruptions are happening faster than ever.
Why digital strategies fail, McKinsey & Co., Jan 2018

60.
Sotiris Sirmakezis
The economics of Digital
Digital competition shrinks value. Customers win, and companies lose. Products/services become obsolete, and value
pools consolidate.
Why digital strategies fail, McKinsey & Co., Jan 2018

61.
Sotiris Syrmakezis
The economics of Digital
Growth rates will plummet. To survive, companies must be first movers.
Why digital strategies fail, McKinsey & Co., Jan 2018

62.
Sotiris Syrmakezis
The economics of Digital
Why digital strategies fail, McKinsey & Co., Jan 2018

63.
Sotiris Syrmakezis
The economics of Digital
Why digital strategies fail, McKinsey & Co., Jan 2018

64.
Sotiris Syrmakezis
Digital inflection point is imminent
Analytics Services Survey, Harvard Business Review, December 2016
47%
believe their traditional business model
will be obsolete by 2020
36%
of non-digital respondents hold this view

65.
Sotiris Syrmakezis Analytics Services Survey, Harvard Business Review, December 2016
Disruption considered “very likely” for some industries

66.
Sotiris Syrmakezis
Business models replaced, innovation necessary

67.
Bill Gates, 1994
“Banking is essential. Banks are not.”

68.
Sotiris Syrmakezis
Tech giants disrupt banks…

69.
By 2021
20% of all activities an individual engages in
will involve at least one of the top-seven
digital giants
Gartner Strategic Assumption

70.
Sotiris Syrmakezis Financial Services Analysis, CapGemini, 2016
A perfect storm enables the emergence of startups

71.
Sotiris Syrmakezis
The “Uberization” of banking

72.
Sotiris Syrmakezis
N26 experience

73.
Sotiris Syrmakezis
FinTech startups jump out of every corner
13000+
fintechs
worldwide

74.
Sotiris Syrmakezis
Challenger banks in UK

75.
Sotiris Syrmakezis © 2016 KPMG Somekh Chaikin
450+ FinTech startups in Israel alone

76.
Sotiris Syrmakezis
FinTech scene in China and SE Asia

77.
Sotiris Syrmakezis
Fintechs cooperate to create larger challenges

78.
Sotiris Syrmakezis “The state of the financial services industry 2017”, Oliver Wyman, 2017
COMBINED VALUATION OF TOP GLOBAL FIRMS IN EACH CATEGORY
Digital disruptors grow much faster than incumbents

79.
“In the future, BBVA will be a software company”
Francisco Gonzalez, BBVA CEO, Mar 2015

80.
Sotiris Syrmakezis
Empowered customers have given rise to a new era
Age of manufacturing
Mass manufacturing
makes industrial
powerhouses
successful
Age of distribution
Global connections
and transportation
systems make
distribution key
Age of information
Connected PCs and
supply chains mean
those that control
information flow
dominate
Age of the customer
Empowered buyers
demand a new level of
customer obsession
A concept of Forrester Research

81.
Sotiris Syrmakezis
We must become digital businesses
Digital businesses
continuously exploit digital technologies
to create new sources of value for customers and
increase operational agility in service of customers

82.
Sotiris Syrmakezis
Adopt digital strategy to business strategy
Digital strategy
Business strategy
Governance
Execution

83.
Sotiris Syrmakezis
Digital Transformation Components
Vison & Mission
Operational excellence
strategy
Business case
Capability map
Digital strategy
Business strategy
Governance
Execution
Customer experience
strategy

84.
Sotiris Syrmakezis
Digital Strategy | Vision
Vision & Mission
Operational excellence
strategy
Business case
Capability map
Digital strategy
Business strategy
Governance
Execution
Customer experience
strategy

85.
Sotiris Syrmakezis
Digital Strategy | Our mission

86.
Sotiris Syrmakezis
Digital Strategy | Our mission

87.
Sotiris Syrmakezis
Digital Strategy | Customer Experience & Operational Excellence
Vision
Operational excellence
strategy
Business case
Capability map
Digital strategy
Business strategy
Governance
Execution
Customer experience
strategy

88.
Digital Dinosaur
Digital Connector
Digital Operator
Digital Master
DigitalCustomerExperience
Digital Operational Excellence
ExternalFocus:Customer
Internal Focus: Enterprise
Data & Insights
Digitally enhanced
products & services
Digital Strategy | Customer experience & Operational excellence
Apply digital technology to
address customers in a more
sophisticated way to increase
revenues and profitability
Decrease cost of the existing value
chain’s primary functions (e.g. R&D)
as well as support functions (e.g. HR)
business
as usual
partial
digitization
new business
models
disrupt (sub-)
markets
Develop new business models
generating profits based on digital
technology

89.
Sotiris Syrmakezis
Inside-Out vs. Outside-In
Inside-Out
Web/mobile enablement
Outside-In
Customer enablement
Existing Systems
(product-centric)
New Platform
(customer-centric)
A Backbase concept

90.
Sotiris Syrmakezis
Inside-out Outside-in
Capabilities
Processes
Technologies
Resources
Journeys
Contexts
Touchpoints
Personas
Service
Customerobjectives
Connect these viewpoints

91.
Sotiris Syrmakezis
PEOPLE THINK
ABOUT HOW THEY
CAN BENEFIT
COMPANIES THINK
ABOUT HOW THEY
CAN PROFIT

92.
Sotiris Syrmakezis
PEOPLE THINK
PERSONAL VALUE
COMPANIES THINK
ECONOMIC VALUE

93.
Sotiris Syrmakezis
PEOPLE THINK
ABOUT HOW THEY’RE
TREATED
COMPANIES THINK
ABOUT THE PRODUCTS
THEY OFFER

94.
COMPANIES ARE FORCING PEOPLE
TO BE SOMEONE THEY’RE NOT
– and people don’t like it –

95.
COMPANIES JUST HAVE TO BETTER
UNDERSTAND WHAT PEOPLE THINK
not your ordinary customer segmentation methodology

96.
Sotiris Syrmakezis
…by designing products &
services as digital-first
experiences…
…leverage digital data sources
and analytics to optimize
customer experience
in real- time…
…by extending the value we bring
to customers inside their ecosystem
of digitally connected products and
services.
…so that our customers rely on us,
they trust our systems to
recommend their next action or
they allow us to take the action for
them.
…to deliver a best-in-class
digital customer experience…
…because the disciplines of
customer experience
influence everything we do.
Digital Strategy | Digital Customer Experience
Digitize end-to-end
customer experience
Digitize products &
services as part of
the value ecosystem
Convert data to
information
Digital front-end processes
Multi-channel service
Digital Marketing and Social Media
Integrated physical & digital experience

97.
Embracing mobile as the platform,
lets the opportunities of interaction grow exponentially
Customer Experience Strategy | Mobile-1st

98.
When we think about digital experiences,
the comparative set is not a competitor’s app.
It’s the last app our user opened

99.
Serve customers in their mobile momentsCustomer Experience Strategy | Mobile moments

100.
Sotiris Syrmakezis
Leverage digital technology to
engage customers and partners in
innovation and product design
Prioritize investments that create
agility in our operations to cope
with rapid changes in market
conditions
Use agile and iterative techniques
to bring digital products and
services to customers
Measure and reward employees
based on customer-centric metrics
over functional metrics
Optimize operations using digital
connections to dynamically source
services in support of customer
value
Empower employees with digital
tools. Aid them build their own
collaboration networks, internally
and with partners
Digital Strategy | Digital Operating Excellence
Source enhanced
operational
capabilities
Drive rapid
customer-centric
innovation
Emphasize agility
Automation of back-end processes
End-to-end digitization
Outsourcing of support functions
Automated analytics and intelligence

101.
Sotiris Syrmakezis
Digital Strategy | Capability map
Vision
Operational excellence
strategy
Business case
Capability map
Digital strategy
Business strategy
Governance
Execution
Customer experience
strategy

102.
Sotiris Syrmakezis
As-is and to-be capabilities required to support the business
Digital Strategy | Capability map | Example

103.
Sotiris Syrmakezis
Digital Strategy | Business case
Vision
Operational excellence
strategy
Business case
Capability map
Digital strategy
Business strategy
Governance
Execution
Customer experience
strategy

104.
Sotiris Syrmakezis
Business case = set of proof points to support the investments
Digital Strategy | Business case | Example

105.
Governance
Digital strategy
Business strategy
Governance
Execution
Cooperation between
department and silos
Thinking beyond a ‘campaign
mentality’ in digital strategy
Clarity of roles and
responsibilities
Company culture
81%
78%
72%
67%
Obstructive for…

106.
Sotiris Syrmakezis
Execution
Culture
Organization
Metrics
Technology
Digital strategy
Business strategy
Governance
Execution

107.
Sotiris Syrmakezis
Digital Strategy | Execution | the components
Culture
Organization
Metrics
Technology
Foster a culture of digital
innovation
Alignment to support digital
strategy, governance, execution
Use customer & business
data to measure success
Use and adopt emerging
technologies
• Education & training plan
• Innovation strategy
• Communication: roadshows, int. conferences, 3rd-party support
• 3rd-party input: Universities, consultants etc.
• Salary & people cost
• Reorganization & restructuring: current & future-state
• Recruitment / new skills
• Customer journey mapping / BPM
• Salary & people cost
• Agency & outsourcer cost
• Customer-centric KPIs
• Data architecture to define services and APIs
• Analytics: web, social, location, footfall etc.
• New measurements: NPS, CxPI etc.
• New payment/reward schemes to reflect x-touchpoint targets
• Architecture vs. journey maps: highlight critical tech transform.
• Touchpoint development
• Technology purchasing & licensing / cloud
• Data model & integration / APIs
• Outsourcing

108.
Sotiris Syrmakezis
Lean Methodology

109.
Sotiris Syrmakezis
Design Thinking

110.
Sotiris Syrmakezis
Service Design

111.
Sotiris Syrmakezis
Service Design

112.
Sotiris Syrmakezis
Agile methodology

113.
Sotiris Syrmakezis
The Digital Innovation Pipeline
Effectively shifting gears between the different phases of the innovation pipeline (for digital innovation)
boardofinnovation.com

114.
Sotiris Syrmakezis
At the end of the day your customers don’t care whether you’re agile, lean
or practice design thinking. They care about great products and services
that solve meaningful problems for them in effective ways.
The more you can focus your teams on these things the better their process will be.
Lean or Design Thinking or Agile?
Work in short cycles
Hold regular retrospectives
Put the customer at the center of everything
Go and see

115.
Sotiris Syrmakezis
Metrics in the digital world
Accenture, 2015

116.
Sotiris Syrmakezis Boston Consulting Group, The power of people in digital banking transformation, November 2015
Phases in Digital Transformation Journey

117.
Sotiris Syrmakezis
The ever-present organizational structure question
Forrester Research, Evolve Your Organization Structure To Promote Digital Maturity
Model
Decentralized
Centralized
Federated
Strategy Governance Execution Description
Embedded in
business units
Embedded in
business units
Embedded in
business units
Centralized Centralized Centralized
Centralized Combined
Embedded in
business units
All strategy decisions made in
distributed, local teams
independent of one another
HQ makes all strategy &
tactical decisions, giving local
teams little to no leeway to
adjust execution
HQ makes most strategy
decisions & allows local teams
to adjust decisions and
execute within specs

118.
Startup-like innovation culture

119.
Sotiris Sirmakezis
Originality is non-existent.
Authenticity is invaluable.
Jim Jarmusch,
Film Maker
To innovate, steal like an artist

120.
Sotiris Sirmakezis
You can’t just ask customers
what they want and then try
to give that to them.
By the time you get it built,
they’ll want something new.
Steve Jobs
CEO, Apple Inc.
To innovate, believe in yourself

121.
Sotiris Sirmakezis
It’s not where you take things from,
it’s where you take them to
Jean-Luc Goddard,
Film Maker
To innovate, start where others have stopped

122.
Sotiris Sirmakezis
Grumpies are good at:
• Finding Mistakes
• Shutting Down
• Saving Money
Search for them, you need them!
Stepping on others’ toes

123.
Sotiris Sirmakezis
Ideas travel from one side of the
table to the other.
Most interesting games are between
opponents coming from totally
different training, technique and
methodology environments.
It’s like ping pong

124.
Sotiris Sirmakezis
Show respect to others
&
Fight like crazy for your
ideas!
Fight like a gentleman

125.
Sotiris Sirmakezis
Accept mistakes

126.
Sotiris Sirmakezis
A man is not into innovation
because he is paid to do so,
but because he wants to*
*Gene Meieran, Intel Fellow
Money isn’t everything

127.
Sotiris Sirmakezis
Focus
on unmet customer
needs
Experiment
with new business
models
Think
like
an ecosystem player
Face
the
non-believers
Choose
speed
over perfection
Be ruthless
about
your liabilities
Innovate
the
adjacent possible
Maximize
the use of existing
technology
Place
a few selective
big bets
Start thinking like a disruptor

128.
Digital business transformation is a journey,
not a destination

129.
MISSION : e-POSSIBLE !
MISSION : IMPOSSIBLE ?
Thank you!
DIGITAL TRANSFORMATION