What Digital Transformation Really Means!!!

The term “digital transformation” and the application of it is very subjective. The idea behind digital transformation is not just the digital replication of existing services and processes, but to transform services significantly to drive better customer experiences.  At the heart of digital transformation is the fundamental rethinking of how businesses use technology to optimize performance. This being the way an organization responds to changing business environments. Start-ups with dynamic business models are significantly challenging established businesses. To stay competitive large organizations must dismantle existing ways of doing business. They must bring about internal changes such as transforming how staff communicate and share information. These sweeping changes are made with customer-centric goals in mind. Businesses often start with digital business optimization by augmenting existing services. They do this by using digital tools to optimize productivity and the customer experience. A common example of digital transformation is major food chains jumping on the mobile ordering bandwagon. This technology overhaul serves the major purpose of improving customer satisfaction and experience by reducing customer wait times and increasing customer convenience.

There has been a growing interest in digital initiatives such as virtual assistants and chatbots. At the forefront, these chatbots leverage natural language processing to establish a digital connection between the business and the end user. At the backend sits powerful advanced analytics feeding useful recommendations to these bots. Industries such as banks and retailers were the first to implement these digital tools. Retailers, in particular, have been forced by external circumstances to make dramatic business changes, those that have been slow to respond have suffered massively. The biggest example of a retailer going out of business is Toys-R-Us.

Implementing an organization-wide change like this needs proper planning. A lot of transformation initiatives fail because of reasons such as poor leadership, lack of communication between IT and business and inefficient operations, to name a few. It is important to align needs and expectations to decide what “digital transformation” means for each individual business. CIOs and other IT leaders need to update their skills and capabilities to lead these modernization efforts.

As markets and end-users continue to evolve, businesses will need to find the right balance between existing business processes and new business models needed to optimize customer satisfaction. It is important to note that short-term benefits and ROI on digital transformation initiatives may be low in the beginning, but the long-term benefits are wide ranging and extremely important. Although there are hurdles that need to be conquered, today’s innovations will become tomorrow’s legacy which will be far better than yesterday’s legacy.

In a nut shell, there is no magic pill to becoming digitally transformed. It is, by definition, an ongoing process.

~Kunika Sodhi, Business Analyst

How IoT is Changing Modern Supply Chain Dynamics!

When I was scouting for my new car, I found that Honda City offers 15 variants of the same car and it comes in 5 color options. A little simple math and that makes 75 SKUs. Now add that to 6-7 more Honda brands available in India. You can imagine how stretched the procurement team will be finding the right products to build the car, the production team who is under the time stress to roll-out the right number of cars and the transportation team who needs to assure availability of the final product to all registered distributors and dealers.

Pressed by dynamic consumer demand, proliferation of digital business & channels and increasing competition, multinational corporations across the world have started to offer more choices to their consumers, meeting their focused demands at a rapid speed, with pin-point accuracy. While consumers are happy, this casts nightmares for the supply chain!

Back in the ‘70s technology made its first major impact on the logistic industry when we moved from physical record-keeping to using computerized systems to store data. What followed was a series of updates by leading manufacturers. In the 1990’s the wheel turned again with two major changes – the introduction of Enterprise Resource Planning (ERP) systems and the rapid globalization of the supply chain (outsourcing). The 2000’s were characterized by the growth of more integrated supply chain management (SCM), leaping to the era of digital transformation, where supply chains are more global and connected given the swift adoption of Internet of Things (IoT), RFID chips, GPS tracking and other advanced technologies.

Global firms recognize the transformational role of IoT, particularly in the manufacturing and retail industries. IoT has the power to transform your supply chain by building efficiency in operations in ways that were never conceivable before. Research says by 2025, there will about 70 billion connected IoT devices globally, having economic impact of as much as $11 trillion per year across multiple sectors.

Ways IoT is improving your supply chain:

  1. Location Tracking
    • Track deliveries from the supplier to the manufacturing facility
    • Track deliveries and materials around your manufacturing facility
    • Track deliveries and materials inside your manufacturing facility
  2. Environment Sensing – Monitor sensitive goods to avoid damage or loss
  3. Fleet Management – Monitor fleets to mitigate risk of fleet breakdown, delay, product decay due to faulty refrigeration etc.
  4. Forecasting and Inventory – Amazon is using WiFi robots to scan QR codes on its products to track and triage its orders
  5. Scheduled Maintenance – smart sensors to manage planned & predictive maintenance and prevent down-time

Impact of System Integrators
Digital Transformation of your supply chain is more than just a cool technology. It’s also about a robust strategy and availability of key skills. Pureplay Service Integrators such as Cognizant, Infosys, Wipro, TCS and HCL to name a few, play a strong role in advising and integrating the right solution for a company’s modern-day supply chain challenges. There are many ways to pick the perfect SI partner. Seven ways that I can think of off the top my head are:

  1. Check their ability to understanding your business needs and challenges.
  2. Check for their experience in the field of supply chain management – examine the case studies wherein they have fundamentally transformed the supply chain system of an organisation.
  3. Check the proposed solution framework, commercials and timeline.
  4. Check their bench strength and people skills.
  5. Check for references – speak with their client’s executives. Inquire about the following:
    • Quality of work done
    • Ease in coordinating
    • Post-delivery maintenance
    • Key benefits from the implementation
  6. At the end of the project, what kinds of training documentation, manuals, and records will be included as a project deliverable?
  7. Conclude by benchmarking the technical expertise and delivery with cost and timeline to choose the right partner!

Conclusion 
Research shows 65% of retail and manufacturing businesses have already begun to transform their supply chain processes. However, in many cases today, there is hesitancy to add devices to a control system unless they are needed by regulations, due to the cost factor. The ability of IoT is to remove this obstacle and make any information available to anyone, anytime. Over the next 5 years we are going to see control systems re-imagined and transformed to play a different role in supply chain management with SIs playing a key role in orchestrating the ecosystem.

~Kishalay Choudbury, Director

Emerging Role of Blockchain in the Healthcare Industry

A frequently heard buzz word now a days is “Blockchain”. This technology has made a significant contribution to many industries and is showing similar potential to various aspects of the Healthcare Industry. One important requirement of the Healthcare industry is to keep the cost of care at a minimum while maintaining high standards and quality care for all patients. Blockchain technology has the capability to influence the way healthcare services are provided and can be a benefit to all players in the healthcare ecosystem.

An improved and integrated healthcare system which is patient-centric along with inter-connecting all the stakeholders involved in this system requires advanced technology to fulfill the ever-growing needs. Blockchain technology would be a great catalyst in the process. It is built on distributed transaction technology which is open and secure yet private in nature. This technology can ensure security, privacy, and interoperability of health data and patient care.

Various stakeholders in healthcare that can benefit with blockchain technology. The chart below demonstrates an integrated healthcare system with a patient-centric care approach.

How can Blockchain help address the present Healthcare Industry challenges?

Blockchain in healthcare can be used in various processes, such as Electronic Health Records (EHRs), drug traceability from manufacturer to customer, clinical trials to eliminate fraudulent data modifications and interoperability. It can address various aspects of the healthcare industry including security, integrity, trace-ability and universal access. It can be used as a medium to connect & sync patient data that exists in various forms and ensure patient privacy by adopting a distributed framework while maintaining patient identity.

Let’s look at how some of these aspects can be enhanced using blockchain.

  • Interoperability – Since every hospital maintains their own data systems & EHRs, blockchain would be able to maintain a standardized system where all data would be formatted the same. This would allow for systems between different facilities to share information seamlessly.
  • Security – Blockchain with inbuilt security features ensures secure patient data transfer. Only the concerned receiver can decrypt data using an encrypted key received from the sender.
  • Integrity – This technology uses a distributed ledger and undisputable transactions that ensure data integrity while encryption of data enhances data security across the network.
  • Universal Access – Blockchain makes sure that required data is present at every node to be available for use to the authorized entities and access rights provided through smart contracts.
  • Cost of maintenance – Data is distributed throughout the network with the help of blockchain without any interruption.

There are several advantages for healthcare to invest in a shared blockchain system. It would be optimizing patient records, tracking medical research, drug supply chain management, billing transparency, data exchange and data security. Some of these advantages are discussed below.

  • Electronic Health Record (EHR) – All patient data such as, medical records, disease history, diagnosis results, medicines prescribed would be stored in different places throughout the patient’s lifetime in the EHR system. Both physician and patient can access the medical record by ‘smart contracts’ based on blockchain implementation that are self-executing contracts provided with a term of agreement. Automation and tracking systems work using smart contracts that can check viewership permission and new information added to the patient’s records. A blockchain system works on the principles of cryptography and decentralization thereby ensuring a secure and interoperable EHR system.
  • Medical/clinical research – Medical research requires patient data to be stored in a variable structure where different stakeholders can utilize the information. This data inevitably is voluminous to say the least. A blockchain database helps in accessing patient data with the utmost trust and transparency among all stakeholders. This technology provides records to be added/writable publicly with no specific ownership, yet data security is ensured through encryption. Blockchain ensures proper information sharing and facilitates clinical studies with the help of private and public key cryptography and shared ledger phenomena. In this scenario, a patient has overall control over their medical records and they can give access or withdraw access to providers and other agencies.
  • Drug supply chain management & integrity – The distributed ledger system of blockchain ensures safe and transparent supply of drugs between all stakeholders. The permanent and decentralized records are entered in the blockchain throughout the supply chain system thus ensuring the safety of data and avoids any error. Blockchain technology makes it possible to know all information regarding any drug in the supply chain including its place of manufacturing up to finally reaching the end-consumer.
  • Transparent billing management & claims – Blockchain technology can identify fraudulent claims, streamline the payment process and verify billing claims that go from pillar-to -pillar throughout the system. This system could facilitate smooth workflows among all involved parties while sharing a single copy of contracts and billing information.
  • Smooth health data exchange – This technology ensures a decentralized system of health data exchange while protecting authentication of information. In addition, blockchain eliminates the burden and cost associated with data reconciliation by enabling easy access to real-time health information.
  • Data Security – Blockchain technology ensures security, privacy of Internet of Medical Things (IoMT) use and information authenticity. It provides a decentralized platform of ownership by tracking transactions made through the system.

The healthcare industry has begun using blockchain technology in different aspects of the care delivery system. It is one of the leading emerging technologies with the promising potential to bring about desirable changes in healthcare as well as other industries. Healthcare has started to realize the benefits of adopting blockchain technology. It will ensure an integrated care delivery, secure patient data and increased patient satisfaction.

~Arpana Bharti, Research Analyst

Data Driven Micro-Segmentation: Now a basic first step

In any business, identifying the right target market is the first step to success. A clear understanding of demand is as necessary as having the right product. The answers to some of the questions might be straight forward or intuitive at a macro level but the challenge is to drill down multiple layers to reach the market segment that best connects with the product.

For a software development company to justify its move towards a cloud-based product, they need to understand the adoption of cloud solutions.  There are several questions that need to be asked. Let’s look at a few of them.

  • Is cloud-based software the fastest growing technology category?

This can be validated with data but is that enough to start marketing the product.

It would not benefit financially to reach out to all 10 million companies. Hence, there needs to be further investigation to see the need for the specific type of software. Let’s take the example of a specific software “Customer Relationship Management”, now the question becomes,

  • How fast is the cloud-based CRM category growing?

Adding CRM to the mix will require data that drills down one more layer. This again can be handled through data collection and data modeling.

Going down the same path, we can add more variables to the question, drilling down further and further to reach the right market.

  • How much is Bangladesh spending on cloud-based CRM software as compared to France?
  • In Bangladesh, are professional services companies or retailers spending more on cloud-based CRM?
  • Within professional services, are large or small companies the big spenders?

Take another example with multiple variables/lens put in the same sentence.

How is the Travel & Expense Software market in United States in the Retail Industry for companies having 50 to 100 employees? Should the marketing dollars be spent on Professional Services companies in France with 100 to 499 employees instead?

By drilling down to a micro segment, we have a manageable number of companies to target. We also can clearly identify the demand within that segment to further assess the financial fit.

Micro-segmentation is complex and difficult, especially due to lack of data but is a necessity to identify the right market and generate the highest ROI from the marketing dollars. The traditional macro-level segmentation is not useful anymore due to the vast differences in the needs of each organization.

~Karthik Pannala, Associate Manager

Artificial Intelligence in the FinTech Sector

The banking and financial industry is on the verge of a major structural change. Compliance and regulations have kept these industries in antiquated legacy systems. Senior decision makers recognize that the banking industry needs to make a shift towards integrating more technology into daily operations.

The buzzword being tossed around by everyone today “AI”, is expected to be the catalyst for the financial sector’s revolution. This is due to the pressure created by FinTech startups forcing traditional banks to implement the latest technology. According to industry reports, the banking industry is expected to spend ~$10 billion by 2020 on artificial intelligence and cognitive technologies, outpacing all other industries.

Let’s explore just how the financial industry is planning on using AI. There are three that are top of mind:

Chatbots:
Chatbot will provide front office interaction with customers by providing personalized response and tailor-made products based on consumer needs. Many banks are betting big on chatbots to replace their front office staff by approximately 40% within the next few years. According to many financial analysts, the front office saving alone will be almost $490 billion dollars due to the implementation of AI. Almost half of that will come from reductions in the scale of retail branch networks, tellers, security, cashiers and distribution staff.

Profiling companies:
 AI and machine learning algorithms have been used in financial trading for more than past 10 years. The obvious use was predicting the prices of stocks based on historical behavior and provide various suggestions to human traders.

Current technologies are miles ahead of these traditional usages of AI in commercial banking. AI could use a large amount of unstructured data to profile individual users and companies by learning from the data. It can then be used to analyze behavior and identify characteristics to predict decisions. For example, many hedge funds are using language and text analysis techniques to analyze word choice of senior executives and try to predict what that means for the future of the company in the stock market.

Security:
Financial institutions realize that criminals are getting smarter and more tech savvy than they previously encountered. To combat these crimes, they need to bring innovation to the forefront of the plan and execute against them.

Historically, the financial crime unit of companies has been reactive and often investigation occurs months or years after the fraud is committed. AI is implementing a more proactive approach where financial crimes can be identified based on historical transactions and spending behaviors in real-time to spot anomalies.

There is a good deal of confusion in the world of finance on just how to pull this implementation of AI off. There are several limitations and obstacles that need to be overcome to fully implement the use of this modern technology into the financial sector.

Automation and AI:
Not all software is supported by AI and most applications fall under the umbrella of automation. The difference between the two comes down to problem-solving vs optimization.

Most companies don’t use AI, they only use data-driven algorithms that provide some level of automation in their day-to-day processes. This is just what the manufacturing industry has been doing for years, taking the latest technologically advanced tools to increase the efficiency of repetitive tasks. A small example of this is scoring loan applications and answering simple client queries that don’t require an ‘Intelligence’ factor.

Unknown factor of AI:
 AI promises some benefits including cost reductionefficiency, better security and a decision support system. But this technology is very new. Thus, it is not fully understood and tested. The financial sector is too fragile to implement unknown technologies.

Automated systems can break the systems and wipe off billions of dollars from the market. A relevant example is from 2013 when Associated Press’s Twitter account tweeted “Breaking: Two Explosions in the White House and Barack Obama is injured.” Within 3 minutes it was identified that the tweet was fake and white house confirmed that there was no explosion.

This was done by hackers, but the real target was not the president, it was the financial markets. In less than a split second, the state-of-the-art computers running high-frequency algorithms picked up these tweets from trusted sources and went into overdrive, reacting to what was perceived as a terrorist attack. The result? The financial markets were down by $130 Billion dollars in just 3 minutes. Eventually, the markets corrected themselves as the nature of the tweet was discovered. This was a wake-up call and cruel reminder that we don’t understand this technology well enough.

Adopting AI will allow companies to eliminate human error while boosting productivity and the bottom line. AI has potential, but the technology is still unknown, and banks are betting big on it to stay ahead of the competition in the Fintech world.

~Ankit Mehta, Associate

LOB Software – Growing Trend Among Small Businesses

Most of us are familiar with the most common types of horizontal business software, such as productivity suites or accounting packages, but many small firms are also using software that is tailored specifically for their type of business.  We have all experienced some of the more commonplace vertical-specific software – for example, every time we make a purchase at a retailer point of sale (POS) software is used to “ring up” the sale or when a visit to the doctor entails our healthcare provider updating our medical information in an HRMS (medical records management) system.  As many different types of businesses exist, there are specialized software applications to help run them, many of which we might not be aware of.

Small businesses spent a lot of money on software to help them run their businesses more profitably.  In the US alone, SBs are expected to spend over $20 billion next year on software, of which over $2.9 billion will be for Line of Business (LOB) or vertical-specific software. SB spending on LOB software is expected to reach $4 billion by 2023… a fair chunk of change.  The Professional Business Services, Other Services and Retail sectors are leading spenders on LOB software.

As with every other innovation, vertical software has evolved in basically two ways. Some have been formed organically.  For example, back in the 1980s, Self Service Furniture was just a furniture store in the Pacific Northwest.  They found that they needed to replace their outdated software to help them run their business, but nothing off-the-shelf really worked for them.  So, they developed their own software, in-house.  Word got around to other furniture dealers and the rest is history. Today they are a software vendor (Genesis Software Systems) selling their proprietary application to other furniture stores in the U.S. and Europe.

Other vertically-oriented software has been specially developed by large vendors, such as SAP and Oracle.  Both vendors offer a broad spectrum of vertical-specific software tailored for a wide variety of industries. Each vendor offers software for about 30 different verticals, such as energy, financial services, manufacturing, public sector services and services sector. Both companies originally created software for larger firms. Recognizing the need and business opportunity within smaller companies, each offer scaled down versions of their enterprise-level software suites.

Because business needs differ based on industry, vertical-specific software can be augmented by horizontal apps, such as CRM, that are geared towards specific industries.  Examples include ApparelMagic which offers CRM, ERP, and accounting integrated with solutions strictly for the fashion industry, such as apparel inventory control. Another example is AgencyBloc, software which performs functions such as CRM and marketing automation with integrated commissions processing for insurance agencies only.

Going forward, software vendors need to bear in mind that businesses, particularly small businesses, need software applications that closely align with their business and “speak their language.”  Firms want and need software that requires as little training and customization as possible.  Vertical/LOB software is expected to grow significantly, particularly cloud-based, and the most successful software vendors will partner with hardware manufacturers and services providers to offer complete packages for small firms.

~Eileen Zimbler, Vice President

Bangladesh & Sri Lanka . . . on a Gradual Path Towards Digital Transformation

Bangladesh and Sri Lanka are two vital countries in the SAARC area (South Asian Association for Regional Cooperation). Bangladesh economy is mostly market-based and export-oriented and has been on a rapid growth path in recent times. Their GDP growth has almost reached 8% annually. Technology adoption has been a key component of the nation’s growth and development. The government has also been promoting the Digital Bangladesh scheme as part of its efforts to develop the growing ICT sector. As per Mr. Sajeeb Wazed Joy, the ICT adviser to the prime minister, “It is likely that Bangladesh will become a major player in the ICT sector in future”. 

In the case of Sri Lanka, the country has plans to create a ‘knowledge-based social market economy’ and an ‘export-oriented economy’ to encourage economic growth.The government boosts the ICT industry. Key bodies that strongly influence the ICT sector include,- The Information & Communication Technology Agency (ICTA) as the government ICT agent, Computer Society of Sri Lanka and Sri Lanka Association of Software and Service Companies (SLASSCOM). Sri Lanka also has few government owned and privately managed IT Parks.

Digital Bangladesh -A Long-Ranging Vision for the Future IT Growth of the Country
Digital Bangladesh with Vision 2021 provides a huge incentive for enhanced utilization of digital technology in the country. Vision 2021 is an envisaged image of where Bangladesh should target to reach by 2021 for example 50 years after Bangladesh’s independence.

A vital constituent of Vision 2021 is Digital Bangladesh. Its key intention is to ensure socioeconomic change through heightened and focused ICT adoption. A typical example of the implementation of Digital Bangladesh is in improving literacy and digital skills and awareness. This is only possible through incorporating ICT as a part of the overall education syllabus. This will help to prepare the future workforce of the nation.

Some Key Digital Applications
Let us mention some innovative examples of digital applications in use in Bangladesh. One is in Land Records. Some new-age applications have come about like ‘e-Filing’ and Digital Land Records that are fast, efficient and preferred by the citizens. The earlier manual method was time-consuming, and citizens wasted a lot of time just chasing different stakeholders & government officials. The entire process is now online.

Another is Mobile Health.  mHealth, or mobile health, is a unique tactic that uses mobile technologies (mobile phones, tablets, etc.) to extend health services and info to patients. Experts concur that the Bangladesh mobile revolution has shaped a massive opportunity to implement mHealth to transform the way healthcare is delivered in the country.

bKash is a vital mobile financial service in Bangladesh regulated by a central bank that provides a myriad of cheap digital services. Some of these services are money transfers, payroll, mobile wallet and savings account. No wonder the utilization of bKash is rising rapidly in the country.

Another example of digital technology implementation is e-Governance. This has totally altered the process of public procurement in Bangladesh. Everything is done over a single web portal providing total transparency in the purchase process.

Sri Lanka – Rising Slowly but Surely
Today, Sri Lanka is focusing on inclusive growth through building a smart digital infrastructure across the island nation and re-positioning Colombo megapolis as a world class urban development. The digitalization process in Sri Lanka continues today with increasing societal & economic impacts. Within South Asia the telecom sector was first liberalized here.

The government has adopted digital literacy in the education sector. Recently, ‘cloud smart classrooms’ have been introduced. Many e-governance services are being expanded. Also, a new national data centre is being planned by ICTA.

Recently, Sri Lanka has been slowly rising in the Networked Readiness Index, showing that the digital transformation of the economy and society is on the rise. Overall, use of ICT in economic activities, such as, e-banking, mobile banking, e-bus ticketing & mobile POS are on the rise.

In Sri Lanka, current adoption is modest but substantial potential exists with efforts from all ecosystem players including government, telecom service providers, global ICT players and ICT associations to enhance end-user awareness and popularize cloud adoption. Sri Lanka Telecom (SLT) launched a national cloud,” AKAZA” that provides affordable end-to-end cloud computing services for businesses.

AMI Recent Study on Bangladesh and Sri Lanka reflect these changes. 
A recent study by AMI on the Bangladesh ICT market indicates that the cloud market in the enterprise segment is anticipated to grow over 20% CAGR in the next five years. Trends like an increase in internet penetration, rapid mobile devices/smartphone adoption and the popularity of social media result in data explosion & growing storage needs. These necessitate the growth in usage of datacentres both captive and hosted. The latter shows a higher future growth likelihood due to its multiple benefits. Some of these being savings in cost, scalability and space.

~Subrata Sarkar, Senior Research Analyst

On-demand ERP – Future Growth Engine for India Service Sector Firms

Background
First, let’s pen a line on what constitutes the service sector. The service sector, also called the tertiary sector, is one of the three principal and traditional economic sectors. The other two sectors are Agriculture (covering areas like farming, mining and fishing) and the secondary sector covering manufacturing. The importance of the service sector can be gauged from the fact that it constitutes more than half of the overall GDP in India. Moreover; its contribution to the GDP is continually on the rise; signifying that India is gradually showing a shift from manufacturing-based economy towards a services-based one. The service sector also provides employment to more than a quarter of the labour force.

Need for a Business Integration Solution
The service sector has become increasingly IT-savvy and technology-focused in its quest to conform to client expectations and achieving global standards in business processes and performance. AMI research shows that service sector SMBs account for over a quarter of the entire SMB business universe and constitutes almost a fifth of the overall sectoral IT spend.

This research further shows that SMBs in India face multiple business challenges. Several of these challenges are the need for business integration, manpower management and payroll processing, automation of manual tasks, ensuring compliance, ensuring higher profitability and cost control. Thus, the need of a robust and comprehensive business application software that can address these business problems has grown by leaps and bounds among India service sector SMBs. With the modernization of the sector and exposure to global business partners, factors like transparency, efficiency and accountability have grown in importance. Many businesses within this sector are on the lookout for business application software that helps in managing resources and providing a bird’s eye view to top management regarding the overall business situation.

The question arises – specifically what are the sub-verticals within the service sector that show a higher potential of growth in terms of ERP solutions?  AMI’s study shows that sub-verticals like back-office service providers (audit & tax / finance & accounting, legal) as well as other service providers (healthcare, hospitality & professional business services) show significant potential of adopting business application software.

Currently, ERP penetration is marginal within this sector with most adoption being an on-premise platform. However, there is significant growth potential for on-demand or cloud-based ERP within this sector in the days to come.

Drivers and Barriers
As part of its survey, AMI has analysed the key growth drivers and hindrances for Cloud-ERP adoption in the service sector. The major growth-inducers, as mentioned by most end-users are ease of use, anytime/anywhere accessibility, automatic upgrades, pay per use improved efficiency and scalability.

There are also several hindrances. These include data security concerns, poor connectivity, performance unpredictability and the need for internal training.

As mentioned by a Travel Agency, “Timely ticket booking online is a key success factor for my business. However, in this city the Internet speed and connectivity fluctuates a lot. So, you can understand the trouble I would face if I am unable to process a request due to internet issues. Hence, cloud-based ERP is not for me!” Another person in the hospitality sector indicated that he was convinced that there would be true TCO benefits “I am not sure that although I pay none or little initially that I may not end up paying a lot more in the long run!

The way Forward. . .
There is indeed huge ERP adoption potential within the India service sector SMBs but for that to become a reality multiple measures need to be undertaken by ERP vendors. One of the most important needs is to select proper implementation partners with adequate technical and service capability. Undoubtedly, this is a vital requirement since in our discussions with service sector SMBs they have mentioned that one of the key bottlenecks to successful ERP adoption is the problem faced during implementation and training. A primary necessity is that partners should have a concept of the vertical-specific Line-of-Business Software usage patterns so that they can gauge the client requirements better and design solutions accordingly. Further, there should be a clear demarcation between sales partners and implementation partners.

Another interesting finding is that most organizations prefer an easy plug-and-play-solution with little customization that should fit most organizations. Vendors will do well to remember this at the stage of product designing. Many end-users are still unaware of the value proposition and advantages of cloud-ERP. Vendors should surely initiate more awareness-building campaigns among prospective users along with channel partners to educate users about cloud-ERP value propositions and remove all misconceptions.

Thus, it is easy to conclude that cloud-ERP adoption and spending is set to grow among the India service sector businesses in the future.

~ Dev Chakravarty, Sr. Manager, Research

How Long till We Have Fully Self-Driving Cars?

In our quest to automate one task after the other, we have now landed on the possibility of self-driving cars. Though still in its testing phase, this technology shows great potential. Companies such as Waymo are already testing self-driving cars in Arizona. Tesla and a few others have rolled out a limited range of autopilot cars. These vehicles do need driver intervention at times though. When something goes wrong with the present vehicles in use, it’s tough to say who’s to blame- the driver or the car.

As these systems keep learning and improving, it won’t be long before we see a fully driverless car needing no human intervention whatsoever. But for systems to achieve this kind of deep learning, enormous training with data incorporating every possible scenario is needed. This makes it one of the most challenging automation projects ever. Among the tasks that need to be automated, there’s not only processing and decision making but also predicting n-number of unforeseeable factors that affect the driving environment. Moreover, the biggest caveat with any moving vehicle is public safety. In the case of a manually operated car, the driver is responsible for continuous observation and analysis of the road/traffic and is required to act accordingly. Another hard-to-automate task is inter-driver communication, such as when drivers nod to each other or signal each other to “go first”. Self-driving cars will have to accomplish all these tasks precisely and carefully.

As of now, this technology has its advantages and disadvantages. The system uses sensors and mapping software which is updated every instant, to map various driving environments continuously. Each accident is a first-time occurrence that involves an unanticipated situation, something that the system will learn from. The key here is to be able to catalogue various objects such as a bump in the road, an overtaking vehicle, or a broken windshield, and select suitable responses in an actual driving scenario. But the developers can’t be expected to predict each one of these accidents in advance. What makes self-driving cars tricky is their response to unpredictable or unfamiliar circumstances such as pedestrians breaking a signal and crossing the road without looking. But the pro here is that once an event has occurred, the system learns from it, comprehends it and the fix can be implemented in all future cars. Companies are looking to feed as much data to these systems as possible, assuming that will lead to the strongest self-driving system.

In their current stage, self-driving cars have already outdone human responses. But it is going to be a long time before we see completely automated self-driving cars everywhere. These cars will initially be run and tested in controlled environments where they are exposed to less unstructured situations. Later, we might see separate lanes for these cars, to avoid unforeseen circumstances in dense areas and to give the system ample opportunity to learn and understand the real-world driving conditions. All said, in the long run, these cars have the potential to reduce accidents and save commute times.

~ Kunika Sodhi, Business Intelligence Analyst

Digital Transformation Hits the Financial Sector

It has become the norm that of the seven vertical industries retail and travel have always been the front-runners in responding to innovation and the adoption of new technologies when compared to the finance and banking sector. But recently, the financial services vertical has begun to re-establish itself striving to become more consumer-centric. This has become necessary due to changing consumer expectations, high-voltage competition and the overall adoption of the latest technologies by other industries resulting in it becoming necessary for financial services to embrace digital transformation. In addition, in the digitized world, the emergence of “FinTechs” (financial startups based on new technologies) are giving immense opportunities to traditional and age-old financial players to come up to speed to compete or collaborate with these new types of firms and co-exist.

Responding to customers’ expectations – bringing about innovation & technology to financial sector
Financial players are integrating the latest technologies into their day-to-day operations and all areas of banking. Some of these are turning to next-gen technologies allowing for remote expert consultation via video and chatbots, analytics-enabled trading platforms and customized services as well as enhancing transactions on the go from any mobile device. Interestingly, financial firms and banks became advanced players to adopt and adapt machine learning (ML), artifi­cial intelligence (AI), data analytics, blockchain and cloud computing. This has allowed them to meet the consumers’ expectation, provide better customer experiences, and to attain operational efficiency and business compliance.

Recent changes inspired large financial institutions to collaborate with fintech firms to acquire the strength of advanced technologies to lure more customers such as small businesses that need hassle-free time-saving technologies to help increase growth. This also allows them to reach millennials who prefer to do all financial functionalities through their mobiles using mobile-friendly apps. Previously, financial firms were using technology to innovate their improvised internal operations and maintenance but with the saturation of mobile devices and the appearance of fintech firms, all focus has turned to providing more efficient & effective customer experiences. This is being done via mobile-friendly innovations contactless payments, payment on-the-go, e-deposits, digital lending, capital markets, P2P payments and many more.

Let’s explore some of the important tech-innovations making their way to the financial domain that are bringing about much-needed change.

Artificial Intelligence (AI)
AI in all verticals, including financial services, aims to provide a more personalized and relevant customer experience. Digitization of banking procedures has enabled a greater number of touch-bases than the traditional banking system. Customers feel more engaged and involved while getting messages from all sorts of channels (traditional as well social media channels). One of the world’s leading banking & financial services launched an AI-driven Facebook chatbot to answer   customers’ queries. Such as what’s their current account balance or to locate the nearest ATM using Facebook Messenger.

AI-enabled banking procedures are making the customers’ experience more convenient and well-connected. An AI-enabled facial recognition system can identify an individual the moment they enter any bank branch and access relevant related information such as spending patterns and recent financial transactions. AI technologies are also helping financial firms in cost-management and maintaining efficiency in their operations. Modern technologies – Robotic Process Automation (RPA) and Intelligent Process Automation (IPA) are great enablers to improve efficiency and productivity. An AI-enabled system analyzes all types of business data and establishes greater internal control of the operating system.

Machine learning (ML)
Machine Learning has been used in many day-to-day activities from email sorting through Natural Language Processing (NLP), automatic update of customers’ records in Customer Relations Management (CRM) solutions, efficiently assisting customers’ through customer self-service portals and many more. In recent time, ML became an important component in many aspects of the financial ecosystem like approving loans, asset management and assessing risks to name a few.

ML in a different format is assisting in essential financial procedures such as portfolio management, algorithmic trading/ high-frequency trading (HFT), fraud detection and loan/insurance underwriting. ML is used to a larger extent to strengthen customer service through chat bots and conversational interfaces, ensuring security (Security 2.0), sentiment/news analysis  by analyzing social media, news trends.

 Blockchain
The use of blockchain (not the open blockchains such as bitcoin rather the private, permissioned blockchains) will be the future of technology in the financial sector. With trusted third parties handling back office transactions, post-trade settlements, trade finance, insurance, and compliance and regulations. Blockchain can be utilized to create client identification systems based on distributed ledger technology and can be used by other branches and different banks in the financial ecosystem.

Blockchain technology would be crucial in insurance deposits and loan decisions by identifying fraud and unreliable sources in the overall financial system. Another significant role of blockchain would be to improve traditional insurance by automated payments.

Cloud
Cloud-enabled applications help the financial sector to streamline many processes such as new digital workflows, to establishing effective collaboration among else-while siloed departments, business units and individuals who are working with the financial organizations. Many in-house systems and processes can be handled more effectively with cloud-based SaaS applications, such as HR, CRM, ERP and financial accounting. The cloud system can secure the overall finance ecosystem in terms of cyber security protection without hiring a specialist team or deploying any technology.

Digital path-way to financial sectors
In recent times, all industries are trying to transform digitally. So is the financial sector where ensuring security, data maintenance & management is almost as important as sustain customers’ trust in the institution. All modern technologies (A-B-C – Artificial intelligence/machine learning, blockchain and cloud) are thus leading the way to attain this revolution in financial sector. In coming years, digital transformation will be a significant component of the investment strategy of any financial firm thereby embracing the digital disruption happening in all verticals.

~ Arpana Bharti, Research Analyst