Executive digest issue 7

EXECUTIVE DIGEST ISSUE 7 | 2014

Luxoft GLobaL upGrade Engineering Business Transformation

Luxoft Horizon is the next generation visualizavisualizaLux tion framework that taps into existing data sources and an nd provides innovative user use er interface through insightful, user-tailored dashboards telling the story behind the numbers. It provides visual simplicity, enabling timely and strategic decision-making. Horizon strikes a perfect balance between business and technology by combining powerful visualization, dynamic and business relevant navigation, and an advanced drill down from KPIs to detailed data points.

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Start

fRom THe eDiToR Usually people are intimidated by major changes.

At Luxo, however, change is becoming a way to win innovation. When I spoke with IT Services guru Dmitry Loschinin, President & CEO of Luxo, I realized that this is a man who truly does not fear change but welcomes it. In fact, Dmitry said casually in an interview, “Actually the best thing about the Luxo Global Upgrade Program is that it stimulates change and in turn that brings more and oen better ideas.” I wish you could have heard it.

Luxo is indeed embracing change. e Luxo Global Upgrade Program is engineering a business transformation for Luxo. Stretching beyond our comfort zone keeps us both creative and open – and when you're working in the IT Services Industry providing solutions to those in the Fortune 500 crowd, that is exactly what you need to be.

Luxo’s global footprint, award–winning expertise, and Agile methods competitively position Luxo in the Automotive Industry with brand–differentiating HMI know–how and tooling. Luxo emerges ahead not only in automotive circles but in the financial world as well, with solutions that raise the bar in "Technology in Support of Regulations," as the article in this issue suggests. Yet it doesn’t stop there. e recent acquisition of Radius has put Luxo on the map in the sphere of the Internet of ings, not to mention being in the forefront of Travel & Aviation, Telecom and re–emerging Energy Practice.

Luxo is not only truly global – it's a leading provider of thought leadership as a next generation IT solutions provider. We are sailing forward!

Roberta Hummel Luxoft Times Editor rhummel@luxoft.com

Team

EDITORIaL BOaRD

PUBLISHER

CONTRIBUTORS:

DESIGNED BY

DmiTRy losCHinin, CEO

PioTR golCZyk

Vasiliy suVoRoV

luxofT

VP Global Communications

EDITOR

PieRRe CasTagne

100 Wall St, Suite 503

PRZemek beRenDT

RobeRTa Hummel

fabRiCe aResu

New York, NY 10005

VP Global Marketing

EDITORIaL & MaRKETING TEaM

Paul ionesCu

Tel : +1 (212) 964 9900

alex leonoV

miCHael TusHman

Email : LuxoftWeekly@luxoft.com www.luxoft.com

seRkan aRslan

alina Plaia

PaTRiCk CoRCoRan

PROOfREaDING

Denis kRyukoV

saRaH Jones

alla PoPoVa

JaniCe PRaTT

ekaTeRina bykoVa kinga misiaRZ

LU xO F T ’ S E x E C U T I v E D IG E ST

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CONTENTS

3

Cover Story: Global Upgrade

12

Industry Insight: The Internet of Things. Wow, right?

ED NO 7

23

Business Thinking Book Review: Organizational Transformation: Winning Through Innovation

32

Events To Be Noticed

34

Luxoft Global Statistics

35

Industry Insight: Technology in Support of Regulations

Employee Branding: The Capsule of Awesome – 6 Ways to Effectively Capture and Define Company’s EVP

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37

15

Can Visualization Help Move Finance and Risk To The Next Level?

Luxoft's Horizon Is The Answer

25

Industry Insight: Unlocking Car Value Through HMI

30

Featured Solution: Populus Suite

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Building A Better World: Education, Community & Environment

42

Analyst Recognition

44

Latest Hype: Accolades for Luxoft

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CoVeR sToRy

six month global upgrade Review & interview with Dmitry loschinin, President & Ceo of luxoft

Luxo Global Upgrade Engineering Business Transformation LU xO F T ’ S E x E C U T I v E D IG E ST

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Cover Story

global management Pillar ensures Luxoft is as close to its clients as possible: the company supports the move of key client– facing managers to business hubs in Europe and the US. Luxoft’s corporate functions are being evenly distributed across European locations.

global Customer experience Pillar is all about building new clients, developing current engagements and expanding the offerings of the company. Luxoft strives to improve both presale and sale processes, while expanding sales teams with industry leaders.

luxofT's global uPgRaDe is in full swing. It’s a massive corporate change program designed to bring the company into the spotlight of the global IT services stage. Let’s review the achievements of the first 6 months of the Global Upgrade.

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Recap

Global Upgrade Program was unveiled by Luxo in May 2014. “e purpose of the program is to catalyze the changes and actions necessary to bring our company to the next level,” says Dmitry Loschinin, Luxo President and CEO. Encouraged by

the outcome of Fiscal Year 2013 – a record year for the company in terms of financial results, reputation, growth and global presence expansion – Luxo designed an extensive change program to strengthen critical differentiators and improve on key opportunity gaps. e main reasons #

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Cover Story

Luxoft Global Upgrade

To keep growing on a global scale, Luxoft is rebalancing its delivery. Within the global Delivery Pillar the company will build equal capacity to provide services to clients across multiple locations. It will ensure greater flexibility to clients and mitigate Luxoft’s exposure to geopolitical risks. Within three years, we anticipate that no more than 30% of the company's total headcount will be present in any given delivery location.

Luxoft is developing its global Culture Pillar in order to work as a global team without borders. Through its Global Culture, Luxoft supports cross–location communities, involving them in the growth of the company while also investing in team collaboration and idea generation tools.

The aim of the global Communications Pillar is to reposition Luxoft as a global player.

This rebranding effort will focus on strengthening corporate communication as well as promoting Luxoft as a thought leader in key competencies and becoming the 'Employer of Choice' in every market.

for launching the program were voiced by Luxo’s CEO during the Global Upgrade webcast: “e program will help mitigate risk for all entities that Luxo interacts with, both internally and externally (clients, employees and investors).

Global Upgrade is a necessary step LU xO F T ’ S E x E C U T I v E D IG E ST

for Luxo to continue growth on a global scale. Considering the steady momentum of the company in recent years, it is the right time in Luxo’s evolution to launch a full – scale global change program. Geopolitical events of 2014 have moved a bit the timing of this initiative, prompting it

to launch earlier than we originally anticipated.” Luxo strives to become 'e Go-To Global Provider of Choice' within its six verticals of focus.

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Cover Story

global mobility

One of the most prominent initiatives of the Global Upgrade program is Global Mobility: the opportunity for Luxo employees to work in a different country, explore different cultures and jumpstart new projects as a part of a global team. Global Mobility opens the door for personal development and career growth.

“Within the last 2 months we developed a Global Mobility framework. It consists of a Global Mobility procedure, supporting materials and organizational structure to provide high quality service to employees ready to relocate,” says Dmitry Kushnir, Luxo’s vice President for Global Delivery.

Luxo is expanding to Central and Eastern Europe too: the plan is to hire 200 people in Bulgaria, 400 in Poland and more than 400 in Romania by the end of the fiscal year. In the next 2–3 years Luxo will employ more than 10,000 people.

Capturing globality: a Capsule of awesome In order to build community and awareness across its locations, Luxoft launched the ‘Capsule of Awesome’ project in 2014. The idea is that the capsule – a durable box filled with fully customized smartphones – travels the world visiting Luxoft locations, where local employees use it to capture their daily activities and stories, share their passion and express themselves (shooting images and videos in and around Luxoft locations). By September 2014 the Capsule of Awesome will have visited places as different as vietnam and Switzerland, accumulating several gigabytes of media showcasing the global life of Luxoft. The most creative efforts will be rewarded and as the COA finishes its journey, a video will be released, illustrating the point that Luxoft people are very different – but, at the same time, united in their passions and aspirations.

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"With the LGU Program, we anticipate Luxoft will have below 30% of delivery resources concentrated in any given region. actually, when we achieve this goal it will make Luxoft more global than the leading global IT services companies…"

Interview with Dmitry Loschinin – see p.10–11

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Luxoft Global Upgrade

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Cover Story

Expanding to Bulgaria Luxo continues to increase its presence around the world. In 2014, the company opened new delivery centers in Sofia, Bulgaria, and Guadalajara, Mexico (Luxo’s first office in Central America). ese locations are praised for having a wealth of technical talent; robust infrastructure; convenient location and conductive business environment. Iliyana Geosheva, Marketing Manager of Luxo Bulgaria, Dmitry Kushnir, vP for Global Delivery, talk to Luxo Times about the rationale for choosing these locations and their future for the company.

Sofia, Bulgaria

Iliyana Geosheva, Marketing Manager, Bulgaria

WHy HaS LuxoFT CHoSen SoFIa and GuadaLajaRa?

Sofia is a popular destination for engineering expertise. Global players like HP, SaP, VMware and Software aG have also established operations in Sofia. The town has an IT pool of about 30,000 engineers and each year, more than 3,000 graduates join the IT market from Sofia's technical universities. Bulgaria also has an attractive tax regime, robust infrastructure, convenient location, European Union legislation, and a secure environment.

WHaT aRe LuxoFT'S pRojeCTS and InITIaTIveS In SoFIa and GuadaLajaRa?

Initially Luxoft’s Sofia office will be working with clients in the financial sector. Later the company will expand its sphere of activity.

Currently our activities in Bulgaria include: a SL3 and general support a Product lifecycle management a Enterprise level development a automated and manual testing

HoW many empLoyeeS doeS LuxoFT Have In BuLGaRIa and mexICo? WHo WILL Be HIRed In THe FuTuRe oR TRanSFeRRed FRom oTHeR LoCaTIonS?

In the last three months, Luxoft has created a team of 70 people, but it is aggressively recruiting 20 + more, so soon headcount will reach a hundred.

Most of Luxoft’s staff are Developers, Qas and Project Managers. Luxoft is looking for JaVa developers, Oracle Developers, Quality assurance Specialists, Project Managers and Business analysts.

Luxoft is planning to work together with educational institutions to see how Luxoft can develop this community of highly qualified specialists. In two years Luxoft wants the headcount in Sofia to reach 400 employees.

WHaT aRe Some oF LuxoFT’S STRenGTHS In BuLGaRIa and mexICo? WHaT do THeSe openInGS mean FoR THe InduSTRy?

Luxoft’s market position in Bulgaria is growing rapidly. We are one of the fastest growing companies for software development and IT outsourcing services on the global market. Our efforts in Bulgaria have been recognized by the Bulgarian Ministry of Economy, which awarded us its a–class investment certificate.

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Cover Story

and Mexico

Spotlight on Locations

iliyana geosHeVa JOINED LUXOfT aS a MaRKETING MaNaGER IN SOfIa, BULGaRIa IN 2014. PRIOR TO LUXOfT SHE WORKED fOR MORE THaN 10 YEaRS IN THE SPORT aND faSHION INDUSTRIES IN BULGaRIa, fOR GLOBaL BRaNDS SUCH aS NIKE, CONVERSE, aND DOCKERS. ILIYaNa HaS a MaSTER’S DEGREE IN MaRKETING MaNaGEMENT, aS WELL aS a POST– GRaDUaTE DEGREE IN aCCOUNTING.

DmiTRy kusHniR

Guadalajara, Mexico

HaS LED LUXOfT UKRaINE SINCE SEPTEMBER 2006 aND NOW IS THE VICE–PRESIDENT fOR GLOBaL DELIVERY. DMITRY HaS EXTENSIVE EXPERIENCE IN SENIOR MaNaGEMENT POSITIONS WITH IT COMPaNIES IN UKRaINE aND THE USa. DMITRY GRaDUaTED fROM THE NaTIONaL TECHNICaL UNIVERSITY Of UKRaINE WITH a BaCHELOR Of SCIENCE DEGREE IN ELECTRICaL ENGINEERING aND LaTER COMPLETED aN EXECUTIVE EDUCaTION PROGRaM aT THE WHaRTON SCHOOL Of THE UNIVERSITY Of PENNSYLVaNIa, USa.

Dmitry Kushnir, Vice–President for Global Delivery, Switzerland

The new location in Mexico supports Luxoft business growth and is a part of the Global Upgrade program. Guadalajara is considered the Silicon Valley of Mexico, with a strong presence of multinational IT companies and electronics manufacturers. Mexico and Guadalajara strongly appeal to US clients due to logistics and time zone convenience.

The first Luxoft team in Guadalajara started working for Hotwire on September 1st. Clients representing almost all of our business lines are showing strong interest in Mexico, including Banking and finance, automotive, Energy and Utilities, and aviation & Travel clients.

The main drivers are: a access to Mexico’s engineering talent pool a Geographical proximity a Convenience of time zone

The first four Hotwire Delivery Center engineers are relocating from Kiev to Guadalajara. This approach ensures quicker start of operations, smoother knowledge transition and greater efficiency of delivery in the startup stage. It also helps bridge the cultural divide. Luxoft plans to invite local employees to visit Luxoft‘s Eastern European locations for knowledge transfer and networking.

In Guadalajara we expect to grow to 100 employees in the next six to nine months. We have just started talking to candidates for the Guadalajara office and we already see big interest from local experts in working for Luxoft who recognize the opportunities that exist within Luxoft.

The Guadalajara location enables us to execute the next steps of our Global Upgrade program: 1. Growing presence in key global IT engineering locations. 2. Developing a nearshore delivery model for US customers.

3. Growing operations in the rapidly developing Latin american market.

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Cover story

More global Interview with Dmitry Loschinin, President & CEO of Luxoft

LU xO F T ’ S E x E C U T I v E D IG E S T

Cover story

Luxoft Times editor: What inspired the Luxoft Global upgrade program (LGu)? dmitry Loschinin: As you know, Luxo started as a company out of Central Eastern Europe but with strong roots in Russia and Ukraine. Yet from the very beginning we intended Luxo to be a global company. Due to recent geopolitical events, however, especially in Russia and Ukraine – but overall the world in general, we took a hard look at our business reality to ensure we maintain our gradual growth. First, we observed that a high concentration of Luxo’s resources in any given geography can create problems. So part of the LGU Program is to redistribute and rebalance our engineer workforce across geographies. Our three year goal is to have not more than 30% of delivery resources in any one location and eventually we aim to have below 25% in each region. Secondly we realized that even though Luxo is already a global company, the perception of Luxo or brand association is oen that it is Russian. Our second goal therefore, is to help people’s image of Luxo in the IT sector match its actual global reality. In the Outsourcing Industry it oen happens that where the idea for the company originates is where people geographically associate or locate the company. For Luxo, however, there is currently no single concentration of resources in a region that is greater than 50%. Actually when we achieve our three year LGU program goal of re-balancing it will make Luxo more global than the leading global IT services companies – who oen have 40% of their total resources concentrated between China and India. At Luxo we are doing great at growing the business, but things such as having a high concentration of delivery resources in two countries and the company perception have made Luxo more volatile than it has to be. In order to address these concerns, and those of our clients and investors, we decided to accelerate the process of globalization.

Luxoft Times editor: What are the major points that have been accomplished in the first six months since the launch of the LGu program? dmitry Loschinin: Aer six months of LGU I have to say that we are on target. Each of the five pillars of LG has a point person and milestones we need

LU xO F T ’ S E x E C U T I v E D IG E ST

Interview with Dmitry Loschinin

to achieve. For the Global Management Pillar, for example, we have accomplished most of the goals we set for ourselves.

We are actually outperforming our plan. e biggest challenge for us is engineering our geographical re-balancing. We actually are at the same level of growth as before, but the growth points are different, namely in our EU countries. We have also started our Global Mobility Program to support the development of Luxo employees. Originally we planned to relocate around 500 people, and we are on target for that number. With the Global Customer Experience Pillar, we also have moved ahead with achieving more face–to–face time with clients than before.

So I would say that with Global Management and Global Customer Experience we are doing fine. In terms of the Global Delivery Pillar we have already initiated and actually made a substantial change in the way we grow. We have shied the focus and growth point to new countries such as Romania, Poland, Bulgaria, and we have substantially increased their contributions. In 2014 we added new offices in Bulgaria and most recently, Mexico. We also started working and building a very solid approach for a Global Culture and Global Communication.

Luxoft Times editor: are any pillars making greater progress than others? If yes, why do you think this is happening? dmitry Loschinin: As I mentioned, we are ahead of schedule in achieving our goals for the Global Management Pillar. Our Global Customer Experience Pillar continues to help us grow while we change and improve th way we work with clients. Global Delivery will take more time as we work to fully implement the mobility program. e Global Culture and Global Communication Pillars will also take longer to implement and longer to see results. is is simply because it takes more time to affect corporate culture and communication on all levels and on a large–scale; however, we can already see that we are moving forward there as well.

Luxoft Times editor: What effect will the LGu have on employees directly? What opportunities does the program unleash for employees? dmitry Loschinin: The LGU Program is opening up opportunities for employees across all Luxoft locations.

Luxoft’s opportunities are no longer limited by geographical boundaries.

Now anyone can go anywhere, depending on the company’s needs. With this kind of movement Luxoft has more of a global flavor. So if they want, for example, employees can be involved in start–ups and early–stage projects in new locations. Our employees are learning how to work and live in different cultural environments and deal with cultural nuances, making the Luxoft Team a truly global workforce.

Luxoft Times editor: What are the biggest obstacles the Global upgrade program faces? dmitry Loschinin: The LGU Program requires a lot of change management. It is changing the way we grow and do business. The biggest challenge has been getting the right people in place to roll it out. Progress requires a shift on all levels of business.

On the one hand, change management will enable Luxoft to raise the bar higher, but on the other, it requires significant change in attitudes and in the way people work. A growing global mentality, however, is going to position Luxoft to respond to any situation and stay on its toes to meet the challenges and obstacles that are associated with change. In addition, unlike many Indian companies, Luxoft already has a global set–up. Luxoft doesn’t have to change fundamentals since the global nature of our clients makes it easy for us to meet them at a global level.

Luxoft Times editor: What do you think Luxoft will ultimately gain from this program? dmitry Loschinin: As a result of the LGU Program, I have no doubt that Luxoft will become a stronger and more competitive player in the global market. It’s going to be easier for us to win and grow new business with a truly global competitive advantage. Luxoft will have a unique offering for clients, who can tap into our resources across the globe – not just in a single or concentrated location. You know, one positive change is often a catalyst for another. We believe at Luxoft that such ongoing improvements yield innovation.

CoVeR sToRy PRePaReD by luxofT Times eDiToR RobeRTa Hummel & CoRResPonDenT Denis kRyukoV

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inDusTRy insigHT

THe InTeRneT oF THInGS

WoW, RIGHT? LU xO F T ’ S E x E C U T I v E D IG E S T

By vasiliy Suvorov with contributions from patrick Corcoran, manager of analyst Relations and Sasha Wolf, product manager for Financial Services #

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Industry Insight

T

he Internet of ings, or IoT, has been making headlines for the last several years. Bold predictions echo those made by explorers of the new world in previous centuries —the connected future, creating markets that will rival the innovative impact of the Silk Road or the advent of the locomotive. Our world is filled with white papers and headlines heralding this new age.

For Luxo, our soware development work in industries like telecommunication, automotive, energy, and others, leads us to recognize that IoT creates real opportunities.

According to research from International Data Corporation (IDC), “A transformation is underway that will see the worldwide market for IoT solutions grow from $1.9 trillion in 2013 to $7.1 trillion in 2020.”1 A large portion of this change in the worldwide market size can be attributed to the growth in the number of smart devices.

Enterprises are looking to leverage the ability to unlock the value of data generated by numerous devices that now have the ability to connect to one another and to cloud–based services via wireless connectivity.

opportunity Creation

e value of IoT comes from content that is created by consumer actions and activity. e world of mobile devices enables all sorts of sensors that we constantly carry around, which creates a very rich context that we further enrich with our activities, such as health and fitness applications.

We make calls, we send messages, we watch videos, and we listen to music. We conduct searches, we read news and books, and we follow friends on social networks. All of these things are enabled by mobile and other devices today, and this is the real driving factor behind IoT. When you have interactive things, there is information to be captured.

One of the most exciting aspects of media is the growth in interactivity.

A set of cable and video player boxes has been replaced by streaming technologies, and Tv services are being provided over the top – not from cable companies anymore. People now use

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Industry Insight

multiple screens to watch a Tv series. ey start on the Tv, then move to their tablet or laptop, but that is just the beginning. Today, a person can watch a favorite Tv series, browse the official website of the show, research behind– the–scene information and send out tweets, all at the same time. at creates a lot of rich data about how a person interacts with his or her environment, which can be captured, analyzed and optimized.

Wearable technology is another exciting source of data for IoT. Smart watches and glass are the first wave of this kind of technology, and Google has led the field by announcing a smart watch platform. ere are a lot of established players in that space, but now that these have become computer– based, with cloud processing technology behind them such as Google Now, applications can be written on a high– performance platform. Google has also taken the lead in smart glass technology, with Google Glass. Although there is currently some resistance to smart glasses, trends show that this type of technology is the future, as it is more natural for people to use gestures such as voice, and gaze to acquire information, rather than constantly swiping with their fingers. One of the problems with smartphones is that they can be hard to use while walking around, an issue that smart glasses easily address. e emergence of electric cars also feeds the growing IoT, because without connectivity in electric cars to help find charging stations, you can quickly run out of charge. is creates interesting business models. For example, in California and Washington, there are supermarkets and malls that have special parking places for electric cars that provide charging while you shop. is is an attractive proposition, allowing firms to enrich and capture value if they make devices that can exchange and process such information. e value of the Internet of ings is that humans use things around us, and by using these things, we generate a lot of information about our intent.

Google has begun to make use of this information with its search engine and Google Now by analyzing activity streams, but there is still a lot of generated data that isn’t being analyzed, because of the enormity of

LU xO F T ’ S E x E C U T I v E D IG E S T

The Internet of Things

such Big Data projects. One could do a lot with data from mobile devices, cars, fitness and health devices, and other “smart” products. Once the data is captured, it’s easy to process in the cloud because all these devices are connected. Cloud capability will be important—it might be a private cloud, a hybrid cloud, or public cloud, but collected data will be somewhere in the cloud, connected by existing scalable technologies.

luxoft’s Play

As a services company, Luxo writes soware for our clients and specializes in mastering emerging technology stacks. We make it our business to understand new technologies so that our customers can rely on us when they venture into new spaces. Soware is only the beginning. We have a large Big Data practice with a focus on Hadoop.

Because it’s all about the data, we’ve invested in Advanced Data visualization technology. Our Luxo Horizon platform is HTML5–based and allows users to create interactive dashboards to understand and analyze data. We also work in car connectivity, where we invest in creating connectivity standards for interactions between mobile devices and cars. We are part of the GENIvI Alliance, where we work with companies like Ford, to convince the industry to standardize so that customers can have hundreds and thousands of useful apps that we prototype. Luxo is also a part of the soware-defined networking initiative and network function virtualization initiatives, because connectivity for millions of devices will require the scalability and adaptability that SDN enables.

going all–in on ioT

Always an industry leader, Luxo launched a new Center of Excellence earlier this year, which focuses on developing expertise and solutions related to IoT. Being a new concept, IoT creates numerous challenges and gives rise to fresh opportunities for those who pursue it. In its recent press release, "e Internet of ings Is Poised to Change Everything," IDC states that challenges exist. "Some of these challenges are on the supply side, including lack of standards, global scalability, and a nascent ecosystem for application

development. On the demand side, the challenges include lack of awareness and other IT/mobility priorities." 2 Perhaps nothing demonstrates Luxoft’s continuing commitment to emerging technology more than our recent acquisition of Radius, a U.S.– based solution provider focused on the growing Internet of Things (IoT) industry. Radius delivers modern enterprise solutions across mobile, cloud, data and application programming interface (API) technologies for select Fortune 500 clients to help them capture, manage, and gain value from their growing volume of enterprise data. We felt this step was instrumental to the further differentiation and development of our company as an innovation– driven provider of complex services and solutions. The Radius technology team and solution portfolio will bring in–depth technical capability that is complementary to Luxoft’s current technology profile. We will now have the ability to offer specialty expertise around sensor data acquisition, real– time analytics and modern cloud platforms. Further, IoT–related domain knowledge will create enhanced productivity and time–to– market for Luxoft’s existing clients in the automotive, energy, technology and telecom verticals.

With our IoT–focused CoE and the purchase of Radius, Luxo is now uniquely positioned to educate our clients on the subject of IoT, deliver related services, and address any IoT– related challenges.

1 International Data Corporation (IDC), The Internet of

Things Moves Beyond the Buzz: Worldwide Market forecast to Exceed $7 Trillion by 2020, IDC Says, June 03, 2014.

2 International Data Corporation (IDC), The Internet of Things

Is Poised to Change Everything, Says IDC, October 03, 2013.

Vasiliy suVoRoV HaS OVER 15 YEaRS Of SOfTWaRE aND SYSTEMS DEVELOPMENT EXPERIENCE. HE HaS LED MaNaGEMENT POSITIONS IN INTERNaTIONaL TELECOM aND HI–TECH COMPaNIES, WHERE HE WaS RESPONSIBLE fOR DEfINING TECHNICaL STRaTEGY, DESIGNING aND IMPLEMENTING REaL –TIME aND MISSION –CRITICaL SOfTWaRE SYSTEMS. VaSILIY SERVES aS VP Of TECHNOLOGY STRaTEGY aT LUXOfT WHERE HE DEfINES aND DRIVES COMPaNY TECHNOLOGY STRaTEGY aCROSS ITS KEY LINES Of BUSINESS. VaSILIY HOLDS aN EXECUTIVE CERTIfICaTE IN STRaTEGY aND INNOVaTION fROM THE MIT SLOaN SCHOOL Of MaNaGEMENT.

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Industry Insight

TeCHnoLoGy In SuppoRT oF ReGuLaTIon

Why Applying Data Visualization Technology to Support Regulatory Compliance in Today’s Post–Recession Economic Environment is a Financial Services Imperative.

Interview with pierre Castagne and Fabrice aresu of Luxoft's Financial practice

R

ecently, Luxo Times Editor spoke with two Luxo Financial Practice experts on the subject of applying data aggregation and visualization technologies in the financial services industry to better manage today’s regulatory compliance requirements.

Pierre Castagne, Managing Director of Financial Services provides his industry experience and expertise, while Fabrice Aresu, Head of Business Support, speaks to designing the perfect technology solution to meet our clients’ needs.

Luxoft Times editor: In your experience, what is the biggest difference in today’s regulatory requirements than before the global financial meltdown?

Fabrice aresu: ere are three main areas of difference: First, the level of detail provided; second, the areas of focus; and third, the quality controls and frequency of regulatory challenges. e global crisis served as a real wakeup call for the regulators.

Suddenly, the standard high level, bird’s–eye view reports weren’t adequate enough to provide the level of detail they needed going forward. In

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fact, regulators are now demanding more data drill–downs, knowing that the devil is in the details. ey are no longer taking information at face value, but require all the granular data to back up and/or explain financial risks and losses. is change means that top managers at financial institutions can't hide behind reports. ey are now investing in systems that can generate the data needed to demonstrate the reasons behind their decisions.

Additionally, regulators are changing their areas of focus. ey are now scratching below the data to discover the how and why behind the reports and to determine whether or not an institution's processes are robust enough to withstand any economic challenge. Previously, on paper, they were all “properly and adequately hedged and stable.” e financial crisis of 2007–2008 however, proved this was not the case. is kind of paradigm shi requires a complete culture change for financial institutions. Everyone at every level must be risk aware and able to understand the importance of maintaining regulatory compliance – that is the main driver of change.

Lastly, in addition to requiring

a greater level of detail, regulators are challenging banks more frequently, which is a real resource drain on financial institutions. Maintaining tight quality controls while remaining flexible enough to produce data– driven reports at a moment’s notice –– that are easily understood and communicated by all levels of management –– is an on–going operational challenge. pierre Castagne: From my conversations with members of the BASEL Committee (in charge of banking supervision), regulators are completely aware that the industry deemed their audits as mere exercises that added little if any value to the business. Nowadays, they are far more open to industry feedback regarding the regulatory burden and how realistic it is. is is very positive since there was a real feeling of ‘regulatory fatigue’ in financial institutions.

Regulators are spending more time with banks to develop ways to make it easier to comply with financial regulations, instead of just serving as “policemen.” ey are creating a more dynamic regulatory compliance

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mechanism overall, as highlighted by the new BCBS239 regulation, which in my opinion will move Risk Aggregation and Risk Reporting to a new dimension!

Luxoft Times editor: Why is regulatory compliance a bigger challenge today than before? aresu: e sheer volume of data presents a bigger hurdle than before.

Regulators are leaving no stone unturned, so there is no place to hide behind yesterday’s staid and standard reports. Also, the increased frequency of reporting – sometimes daily – incurs incredibly high costs in manpower and other resources. is requires maximum internal organization and laser focus on efficiently managing the necessary technologies to maintain compliance.

Castagne: In my opinion, globalization and the increased level of technicality are the two main factors raising the level of complexity of the regulator duty. Financial institution managers, shareholders, and regulators in different countries think differently, so reporting needs to reflect those differences, but must also be integrated and consolidated.

Luxoft Times editor: What are the key drivers and challenges for financial institutions to comply? aresu: Transparency and visibility are vital at every level. Unfortunately, the lack of transparency is part of what led to the global crisis in 2007.

Also, a complete culture change toward regulation is needed.

Regulators cannot be viewed as a necessary evil, but should be seen as valued partners in bringing regulatory compliance and risk management education to all employees.

Compliance is no longer the responsibility of just a separate group of financial analysts locked away in a room somewhere, but something everyone must understand in order to improve reactivity and make better, more informed decisions. As with any chain of production, it is only as strong as its weakest link – every employee must understand their individual importance in that sequence or it’s doomed to fail.

Castagne: Financial institutions are pushed by market forces to reduce the probability and severity of losses resulting from changes in market

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conditions, counter-party exposure, etc. In addition, the speed with which credit, and market information is made available is constantly increasing. is forces risk management and control to move away from a paper/end of day approach towards a more dynamic approach with near-time dashboarding, and leveraging advanced navigation (drill-down) through Risk KPIs. Luxoft Times editor: Banks are equipped with multiple reporting solutions. Why isn’t that enough? aresu: Because most BI systems and solutions are targeted toward analysts and statisticians, not toward end users such as senior managers and decision makers. Supplying data quickly and in a manner that can be easily understood and communicated is absolutely critical today. Banks and other financial services organizations will not survive in today’s environment if they’re stuck waiting for a call back or the next business meeting to gain clarification on something.

A “one–size–fits–all” classic BI solution is no longer viable. Instead, tailored reporting that’s adapted to the end users is what guarantees better– informed and timelier decisions.

Castagne: Everyone wants a better organization of their DataMart’s and their golden sources.

The main trend these days is to work on data quality. This implies massive focus on coherency: we need to use same financial functions, same market data and same calculation engines across the different business lines, asset classes, and the different categories of Risk. Many institutions today have engaged massive project aiming at breaking the silos between credit, market, operational and liquidity risk.

Luxoft Times editor: aren’t cost constraints contradictory with fully tailored solutions? aresu: One of the misconceptions in the financial services industry is that personalized customized reports means expensive. People thought BPI reports were expensive and most large institutions have already invested millions of dollars in

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Industry Insight

reporting methods that give them limited visibility and rely heavily on analysts for translation. Paper prevents people from drilling down to details and CEOs and CFOs often don’t read reports of 50 to 60 pages.

Instead, customized solutions can result easily from more robust and proven delivery processes, but must be implemented from analysis and design to final deployment.

Out–of–box report solutions are a thing of the past – senior level managers need to have the data jumping out at them. They need solutions that are intuitive, that don't need to be interpreted by a statistician. So really, tailoring the data and presenting it clearly to the end user is crucial to regulatory compliance as well as overall profitability.

Employing the expertise of offshore development offers unbeatable cost as well as quality when working with the right partner.

Also, leveraging processes and best practices from other industries can help speed delivery and quality. For example, we can mirror the automotive cognitive practice for screen content and gaming for quality and speed.

Luxoft Times editor: What other benefits are you expecting by deploying such a solution? aresu: First, we expect to see a more collaborative work environment, using comment and annotation functionality and sharing of dashboards between individual end users and groups. Also, regulatory audits will become more seamless and conducted with history and versioning, comments, and sign off capabilities.

Involving more users, interviewing the clients and working with them to tailor the perfect solution results in wider user adoption. Subsequently, with wider user adoption, the organizational culture change needed for regulatory compliance will be much easier to affect.

For example, at Deutsche Bank, we were able to make the technology and tailored reports less expensive.

We implemented Horizon, Luxoft’s next–generation visualization Framework, to provide a high

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Technology

performance, graphic rich and intuitive user interface and customized end–to–end convenience covering all their KPIs. The framework provides a system that allows the bank to mine their data with macro and micro perspectives that range from high level overviews to precise client performance and risk measurements by business line.

Luxoft Times editor: How is Luxoft responding to the industry? aresu: We continue to apply the recipes that make us successful. By applying our software engineering capabilities and latest technologies, we continuously innovate, resolving industry challenges in the regulation and compliance space.

Our success is achieved only by actively listening to the market and to clients, anticipating their needs and spotting industry trends. is is what we did with our Horizon Conduct Risk application. We tailored a precise response to a specific problem faced by the industry.

We have two strong working premises: a We never advocate a one–size–fits– all solution. Instead, we believe that each institution needs individually customized tools to exploit 100% of their workforce and resources. a We know that problems can be understood – and solutions identified – but only by digging into the details with the people facing them, not by elaborating our system features from an ivory tower.

Castagne: We understood that in order to process masses of data and make it understandable and interpretable by all stakeholders, we needed to design Horizon with an obsession to deliver a great user experience. Adoption is key. If any Horizon end user needs a training to navigate dashboards, then we have failed to deliver the best User Experience. Our user-driven solution has an unparalleled graphical power, which we use to highlight patterns and trends on massive indicators.

This is what makes Horizon the best platform to be leveraged by financial institutions to move away from traditional reporting/monitoring on paper print out and excel/ppt export.

Luxoft Times editor: What concluding comments do you have about technology in support of regulation? aresu: Technologies have long proven that they can make complex processes accessible to most of us, no matter what our profile. We believe that the technology evolutions will continue to make analysis and transparency more streamlined and straightforward.

Unfortunately, the misconception that such powerful technologies coupled with tailored solutions are too expensive and that projects are never–ending, remain the norm.

With Horizon, Luxoft has demonstrated that it is possible to deliver customized, powerful solutions in record–breaking time frames and people are showing greater interest. We believe too, that faster deployment of these new technologies will become a crucial competitive factor soon. pIeRRe CaSTaGne HaS 20+ YEaRS’ EXPERIENCE IN SOfTWaRE aND SERVICE DELIVERY TO fINaNCIaL INSTITUTIONS WITHIN EMEa aND LaTIN aMERICa. HE HaS a STRONG TRaCK RECORD IN SETTING–UP NEW BUSINESS, aND PROMOTING SOLUTIONS WHICH EMBED PROfESSIONaL SERVICES, PLaTfORMS, SOfTWaRE aND OTHER CaPaBILITIES IN THE aREa Of TRaDE aND RISK MaNaGEMENT, ELECTRONIC TRaDING aND CONNECTIVITY, QUaNT aND ONLINE SOLUTIONS aND ENTERPRISE DaTa DISTRIBUTION PLaTfORMS. PIERRE HaS DEEP fINaNCIaL SERVICES INDUSTRY KNOWLEDGE WITH SPECIaLIzED EXPERTISE IN TRaDING WORKfLOWS (fRONT MIDDLE aND BaCK– OffICE), OPERaTIONS aND RISK MaNaGEMENT; aS WELL aS THE REGULaTORY ENVIRONMENT DRIVING CHaNGES IN THIS INDUSTRY. HE GRaDUaTED WITH a MaSTERS DEGREE IN ECONOMICS , UNIVERSITY Of MONS (BELGIUM): fUCaM. FaBRICe aReSu HaS BEEN WORKING IN THE SOfTWaRE INDUSTRY fOR THE PaST 15 YEaRS, WITH a SPECIfIC fOCUS ON fINaNCE aND RISK. HE HELD VaRIOUS POSITIONS, fROM CONSULTaNT TO PRODUCT MaNaGER, aT fIRMS LIKE THOMSON REUTERS, ORaCLE aND NOW LUXOfT. faBRICE IS aN aDVOCaTE Of INNOVaTION THROUGH OPEN SOURCE TECHNOLOGIES, WHICH HE PROMOTED IN VaRIOUS aREaS Of THE BaNKING INDUSTRY, INCLUDING fRONT–OffICE, RISK aND REPORTING. HE IS CURRENTLY fOCUSED ON aDVaNCED VISUaLIzaTION TECHNOLOGIES, IN THE CHaLLENGING CONTEXT Of BIG DaTa aND THE INCREaSING DEMaND fOR VISIBILITY aND MOBILITY fROM BaNKS' SENIOR EXECUTIVES.

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Industry Insight

Can vISuaLISaTIon HeLp move FInanCe and RISk To THe nexT LeveL? LuxoFT HoRIzon IS THe anSWeR

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Luxo Horizon is the next generation visualisation framework that taps into existing data sources and provides innovative user interface through insightful, user-tailored dashboards telling the story behind the numbers. It provides visual simplicity, enabling timely and strategic decision-making.

Horizon strikes a perfect balance between business and technology by combining powerful visualization, dynamic and business relevant

navigation, and an advanced drill down from KPIs to detailed data points.

Horizon Unique Selling Points are: a Innovative and graphically-advanced User Interface (UI) a App-based approach a High performance a Security a 100% Mobility (iPad, iPhone, Android, etc.) a High customization In today’s Big Data world, we believe that fast access to the right

information will translate into a competitive advantage. Fast access can only be achieved with the right technology, compelling navigation, and advanced visualization.

Let’s take a brief tour with Fabrice Aresu, Head of Business Support and Horizon Expert, who will walk us through some key elements that demonstrate Horizon’s data mining power.

As presented here, Horizon allows building synthetic screens, highlighting the key indicators to focus on, in a given context. In the first example, you can see the user analyses treasury and liquidity indicators. Our widgets provide dynamic visualization of the historical evolution of the Key Performance Indicators (KPIs) and a seamless drilldown into more details. Grouping data by currency, region, or any other metric is just one click away.

In the second example, the Liquidity Coverage Ratio (LCR) breakdown is depicted. Each of the sub-sections can also be drilled-down to reach the maximum granularity available in the data source. Such flexibility and direct access to the bank’s record ensure unparalleled visibility and understanding of the situation, all of which is instrumental in the decision making process.

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Luxoft has teamed up with partners to address their regulatory needs. Through aggregating information into a single source, Horizon provides an efficient visualisation platform that helps banks in anticipating regulatory changes. Such tools are becoming critical in business areas such as conduct risk, which has been put into spotlight due to numerous events related to market abuse.

It is crucial for institutions to tackle conduct risk at every level of the product lifecycle: starting from product design, through distribution and complaints, and all the way through to post-sales activities.

To be sure, Horizon is accessible at all required levels of the company, bringing everyone to the same table. As a result, all stakeholders have the same understanding of the situation and the areas requiring their attention.

From the high-level overview presented above, the user can access several levels of analysis and drill-downs.

The first level of analysis is obtained by clicking on the plus sign (“+”) of any pillar. Here, we present the example of Product Design, which displays the performance of various segments (Retail, Private, Corporate, etc.) against the established thresholds for each key indicator. These indicators cover multiple areas and combine several systems; e.g. Complaints can be sourced from the Marketing system whereas Sales information can come from the CRM system etc.

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Historical analysis can be reached in just one click, allowing performance comparison against each of the indicators previously shown.

Detailed views allow intuitive data navigation. Depending on user preferences, multiple displays are available: from a classic bar chart (topleft) to more advanced representations such as “Radar” (bottom-right). Each display allows switching KPIs thanks to accelerators available on the left side of the screen (from Assets to NPL or Assets vs NPL).

The bar view permits to change the dimensions and pivot by using a slider on the top, while the radar displays multiple axes at a time. The radar effortlessly replaces classic tables, including pivots, as it combines all information in a single widget instead of 4 or 5 tables. This allows spotting deviations and trends not only in a more efficient, but also in a much more visually pleasing, manner.

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Technology

With all the aforementioned features, Luxoft Horizon has excelled at user adoption by providing multi-platform access to risk and compliance metrics. It brought a “single version” of risk exposures that ideally replaces the current use of outdated spreadsheets and presentations. All of the above has vastly contributed to improving risk culture and will continue to do so in the years to come.

Horizon has received wide industry recognition as the winner of the 2012 UK Industry Award for business IT Innovation for Technology Excellence and the 2013 FS Tech Awards for Innovation in IT. Luxoft Horizon is the first platform that focuses on business decision makers, who expect easy navigation. With its power of visualization, Horizon is the best-in-class solution and a platform to be leveraged.

To find out more, please contact Fabrice Aresu at FAresu@luxoft.com or visit http://www.luxoft.com/financial- services/

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business THinking book ReView

oRGanIzaTIonaL TRanSFoRmaTIon: WInnInG THRouGH InnovaTIon Why risk change? It can be the seed for innovation. is internationally acclaimed expert offers a practical methodology for overcoming disruption, creating innovation streams, and sparking organizational design & transformation. michael Tushman, author & professor of Business at Harvard university

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harles O’Reilly and I describe the “Tyranny of Success”: the paradox in which the old ways of operating that made the firm so successful in the first place are now the very things that prevent the firm from adapting and transforming. We describe the many pathologies that lead successful companies to fail: a Cultural lock–in where they can’t move out of the past; a Blindness to disruptive technologies, where they deny that new innovations can succeed; a Failure to align for executing a new strategy, when they do identify the need to act and; a Underestimation of the scale of change needed to lead new markets.

We outline a problem–solving methodology for identifying the root causes of this organizational inertia and explain how to develop solutions to overcome it. Many firms have since adopted this model as a way to create urgency for change within a leadership group ahead of a major disruption. It enables leaders to

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develop agreement on the key changes that are needed and the action steps required to achieve them. e first step is to have clarity on the business outcomes – what are you seeking to achieve, how do you measure it, and how are you doing it?

You can either have a performance gap – a shortfall between current and anticipated results, or an opportunity gap – something you are going aer for the first time. e next step is to identify the key tasks needed to execute the strategy – what do you need to get it right and to be successful. e third step is to identify the root causes of the barriers to execution. ere are typically three causes of such inertia: a Leadership – the functioning of the senior team and the behavior of key leaders a Hardware – key tasks and priorities, management systems, organization design and incentives a Soware – capability of people and the behavioral norms or ‘culture’ of the organization Finally, you develop solutions and remove the root causes that prevent the organization from achieving its goals. e aim is to

achieve ‘congruence’ or alignment between the organization – leadership, task, structure, skills and culture – and the strategy. If you try to execute a new strategy without aligning the organization, then you get the strategy you started with and were trying to change. is is particularly important when it comes to responding to disruption. New innovation oen challenges the core competency of an organization.

For example, the Swiss watch industry invented the quartz movement in the 1960s, but then went bankrupt in the early 1980s because they refused to bring it to market and got killed by Japanese competitors. e core competency of the Swiss was the mechanical movement and not the material science of quartz. So, it is important to separate out the new exploratory ventures from the existing core business.

We call this approach ‘ambidexterity’ and argue that in uncertain markets, businesses must learn to balance ‘exploration’ into new business areas with a focus on driving

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Business Thinking Book Review

Winning through innovation

THE PaUL R. LaWRENCE MBa CLaSS Of 1942 PROfESSOR Of BUSINESS aDMINISTRaTION aT HaRVaRD UNIVERSITY, MICHaEL TUSHMaN IS INTERNaTIONaLLY RECOGNIzED fOR HIS WORK ON THE RELaTIONS BETWEEN TECHNOLOGICaL CHaNGE, EXECUTIVE LEaDERSHIP aND ORGaNIzaTION aDaPTaTION, aND fOR HIS WORK ON INNOVaTION STREaMS aND ORGaNIzaTION DESIGN. MIKE IS aN aCTIVE BUSINESS CONSULTaNT aND EDUCaTOR WITH CHaNGE LOGIC, WORKING WITH CEOS aND SENIOR TEaMS aROUND THE WORLD. WWW.MICHaELTUSHMaN.COM TWITTER: @MICHaELTUSHMaN

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performance of the Core business.

Ambidexterity involves setting up separate units for each activity so that the new, small, vulnerable ‘explore’ units can survive the ‘tyranny of success.’ is approach helps to prevent organizations from killing innovation by either starving it of funds in order to meet short–term margin targets in the Core, or by subjecting it to the same performance expectations as the current businesses.

Ambidexterity also allows a new growth business to be properly aligned to the needs of its strategy.

Even when there’s a new strategy, most organizations are aligned toward the old strategy. Falling back on the old ways of executing that new strategy will only end in frustration; a new strategy requires a new execution plan. at execution plan is dependent upon all of the key stakeholders being on the same page, sharing a common vision, and buying into the organizational culture.

One of the most notable applications of the book’s methodology was at IBM. Starting from the late 1990's, IBM redesigned its strategy process around many of the key insights described in Winning Through Innovation. It focused on solving key performance or opportunity gaps in the business, rather than sleepwalking through an annual planning process that didn’t address the most important issues. It led to workshops for the top 2000 executives in the business applying congruence methodology to enable the business to speed up the execution of its strategies, and it launched twenty–three ‘Emerging Business Opportunities,’ explicitly adopting the ‘ambidextrous’ approach that we advocate.

By 2006, these businesses contributed more than $15 billion dollars in incremental growth and were a more effective growth instrument than acquisitions.

As evidenced by executives at IBM, and countless other business leaders who have applied its concepts, I’m pleased that Winning Through Innovation truly is ‘A Practical Guide to Leading Change and Organizational Renewal.’

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inDusTRy insigHT

Luxo puts forward thought leadership on human machine interface, customer experience, and car value.

unLoCkInG CaR vaLue THRouGH HmI discussion with vasiliy Suvorov & Luxoft Times editor

Luxoft Times editor: HmI is a hot topic for the industry and for Luxoft as the company has achieved significant leadership and outstanding results for its customers in the automotive sphere. vasiliy Suvorov: Yes, HMI is not only a hot topic: it is defining the market. e industry is really unlocking car

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value through HMI. In fact, Luxo’s reference design platform for in– vehicle user experience (Ux), Allview, was recognized for “HMI Design Innovation” at the we.CONECT’s CAR HMI Concepts and Systems 2014 Congress, which took place in Berlin, Germany. Luxo was honored with second place aer volkswagen.

Luxoft Times editor: That is really incredible. In the face of such HmI growth, let’s talk about the existing challenges the car makers are facing, and how Luxoft solutions are responding to these pain points of oems and Tier 1?

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Industry Insight

The number of screens in the car is growing fast.

Suvorov: Let's back up a bit first. We all know that the 'Age of Customer Experience' is here. e reason to focus on customer experience with HMI is actually very simple. As Alicia Boler– Davis, the head of customer experience at GM, pointed out during a round table organized by JD Powers & Associates, it is not only about creating a quality vehicle (and GM has had some issues there), but the fact that consumers are connected and they really expect the experience of the car to be not only about the quality of the car. It’s also about: How do problems get resolved?

What information you can get from the car? How can you share it? And, how you can go beyond infotainment technology?

In Automotive Industry circles, words that you frequently hear are: “Empowered Consumer and Connected Car.” According to that same JD Powers & Associates Roundtable Discussion, Empowered Consumers “are among people that send more than 500 million Tweets per day… among some 2.8 billion Internet

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users and 1.5 billion smartphone subscribers. ey seem to buy from companies that engage them and ask their opinion. eir needs go beyond entertainment and technology to include design elements like materials and lighting.”1 Essentially the Connected Car is viewed by the industry as the way to solve a lot of different issues including: a Keeping your car current by updating its soware over the course of the year a Connecting mobile devices to the car and using them in a safe and engaging manner a Bringing in personal innovation, insurance diagnostic data and customer service.

It is not just technology, however, that gets people excited about the Connected Car. ere are several issues. Take GM, for example, one of the largest auto manufacuturers in the world. If they retain just 1% of US consumers alone, it represents $700 million in additional revenue – not a small number. And it’s not only

about competing with other vehicles or other manufactures, it’s actually the ability to impact the bottom line that matters.

Certainly, infotainment is a key part of consumer experience, especially today with younger generations driving who have positive experiences with consumer electronic devices from Apple, Android, Samsung, and others. Unfortunately, they report a lot of problems with navigation and entertainment features in their cars. Given the buying power of these particular consumers, OEMs are starting to realize that they must resolve these challenges.

Luxoft Times editor: vasiliy, exactly how do you solve this problem of satisfying consumer needs for connectivity. Is HmI the answer?

Suvorov: Well, yes. What is in front of the driver? e vehicle controls and a digital cluster. e controls of the modern car are accessible only through the graphic information in the digital cluster and Head Unit. So as you can see, many features are only

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Industry Insight

presented to you through HMI – the graphical user interface. HMI is really important – if it is not there or if it is difficult to use, it doesn’t matter how big your engine is, you are going to get frustrated.

Now, we have to be specific, because the HMI experience or the experience provided by the graphical user interface is different for the driver than for passengers. For example, for the driver, it is all about road attention.

It is also about achieving the best possible ergonomics, so you enjoy your car more. Infotainment features such as music, internet, radio, navigation, access to your meetings and maybe social events – should all be available in a usable and safe manner.

When you shi attention to the passenger’s HMI experience we certainly see a different focus. As a passenger, you can help the driver as a co–driver especially in congested situations. But we also want to make this experience enjoyable for passengers, which we do through ergonomics, infotainment and passenger – centered features.

One of the big trends in HMI transformation we are seeing today is the digital cluster becoming more mainstream. ere is ample growth opportunity beyond premium cars, with experts predicting a 7x growth rate in mid–class models. Moving HMI into the mainstream is important because of the high volume. It means OEMs can bring these devices to market faster while spending less

Technology

money because there are more models and the margins are higher. Luxo can help OEMs bring these special HMI features to the forefront. e digital cluster is moving beyond just combining analog information with stats on how much gas you consume etc. It is about creating a digital screen and using technology to display the most important information to the driver at precisely the right moment. e digital cluster and its HMI structure needs to avoid driver distraction within the context of offering car data, ADAS, connectivity, automation, and personalization. e HUD display is another screen opportunity that used to be cost prohibitive and privileged, originating from military devices. Recently however, we have seen that even mid– size vehicle manufacturers like Mazda, have found a way to display information for the driver on the Head–Up Display. ey use a technology called a “combiner.” is solution utilizes less expensive technology and allows you to take advantage of a unique position on the front panel. Drivers do not have to worry about keeping their eyes on the road with the HUD display since all critical alerts and important information updates appear directly in front of them. is is the perfect way to display additional information to the driver. is option is also a business opportunity, with an estimated 10x growth factor by 2020.

HMI technology, though, needs special

skill sets and will require some interesting partnerships in order to go mainstream.

What about center stacks?

Easier access to features is key. Screen sizes are growing and will have higher resolution for better graphics. We must concentrate on how to connect and control all these screens together.

We need to prepare for Multiple Modalities for control possibly even with gestures. From a business standpoint we will see over 3x growth by 2021.

Recent developments, however, are prompting OEMs to search for ways to possibly replace the screen with the competing power of new tablets and mobile phones. e question everybody is asking in OEM circles and at automotive conferences is, “Do we just replace the car interface with interface from Apple or Google?” e answer is “no” and the reason for that is hopefully apparent by now.

A car is not just a set of devices. It is not simply a phone. It is potentially dangerous because people must concentrate on driving. erefore the real ambition for OEMs and Tier 1 is to surpass Apple and Google. We, as an industry, are hoping to create a user interface with HMI that brings out “car–ness” – something that is better, cooler and more engaging, while at the same time, safer. at’s what we need to do.

"We can think of the car as the “biggest wearable device"

Industry Insight

Luxoft Times editor: How do we go about creating in–car HmI that actually goes beyond apple and Google devices and differentiates the car and its brand?

Suvorov: The way to answer this question is to put the consumer at the center and try to merge car technology and consumer needs and wishes. Someone said to me recently that we can think of the car as the “biggest wearable device.” The car actually can “think” faster than the driver when we combine all the information available from the car and the Cloud, so we can concentrate on making the experience of driving more personal and enjoyable. Here again, the graphic user interface plays a key role. In–car HMI’s graphic user interface is an OEMs way of differentiating its brand. In– car HMI is the way we interact with the car and that is very important for OEMs. It is for that reason that I think the interfaces will be unique.

It is very exciting to see the growing number of different types of screens in cars and the opportunity for companies like Luxoft to help OEMs realize this very complex vision.

Luxoft Times editor: as you know, the new trend is the autonomous vehicle. What can you share with us about the self–driven car?

Suvorov: Since last year the concept of self-driven cars has become increasingly more important.

Considering all the computing power in the vehicle, all the driver distraction concerns, and all the increases in information and connectivity; the car really needs to help the driver drive.

Luxoft Times editor: vasiliy, how is Luxoft responding to the automotive industry in this period of dramatic transformation?

Suvorov: As higher resolution digital screens are becoming available, you can really start differentiating brands. Even low– cost vehicles can look much more expensive because of high resolution screens and 3D graphics. It is possible, for example, to create a virtual extension of the interior by using high quality graphical objects that will have realistic looking metal, wood, or carbon surfaces, etc. and will extend available physical space

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by taking advantage of 3D space in the screens. In fact, the so called “material design” is the latest trend even in the GUIs for consumer devices. Design language and creativity is becoming very important in the world of Automotive HMIs. As we work with OEMs and Tier 1 we offer design services to help them prototype how things will look before starting production. Luxoft created a demonstrator called Allview. In the automotive industry no one wants to see just a PowerPoint presentation. Allview allows us to see in 3D what is possible.

Allview uses embedded boards from TI and Nvidia and brings together the digital cluster, head–unit, connected devices and various types of controllers. The key concept of the demonstrator is something called Timeline. The idea is that when you drive the car, there is information about the past and information about the future, especially when you connect your calendar and agenda (cloud intelligence), so you know, for example, when your car needs to be serviced. It can analyze how much you drive, how much you spent on certain services, and when the next service is needed. It can make an appointment, play music and connect your mobile devices. You can even find a favorite song that played a few hours ago or last week and the software will automatically combine media sources – Cloud, a connected device, local CD or even an Internet Radio. We want to make sure that the car remembers what has been done and that the information is available on the screen of your car.

Luxoft Times editor: Let's go further, can you talk a little about HmI tooling and how it can help companies implement?

Suvorov: HMI tooling is about bringing all of this complex technology together. It’s very important for OEMs to have the right tooling. Tooling determines time–to–market, and the amount of money spent on designing interfaces and bringing it all to production.

One of the reasons why there is such a big gap between consumer

electronics and car technology is because it often takes four years to design and implement a user interface. A lot of time is spent in the brainstorming phase when the designers are not working closely with engineering, striving together to create a compelling prototype.

Usually when Luxoft starts working with a company, it takes up to 18 months to implement the design. The right tooling allows the teams to interact and determine if the design specifications are implementable and what the design implementation looks like in a real car using a simulated environment.

This flexibility to toggle back and forth easily between the design and implementation phases; dramatically reduces the time and effort required to realize and implement.

Keep in mind that design specifications usually produce several thousand screens that have to be implemented. Typically, OEMs have different variants for different local languages, for night and day, and for regional market variations.

Thus, effective tooling allows you to simulate your HMI using a run–time engine that has the same behavior in a PC environment as all other embedded environments that are going to be deployed in the vehicle.

Luxoft has two product lines in HMI tooling. One is called TEORA. This is the technology we use internally for many different projects to help Tier 1 and OEMs implement premium head units. It has been used in cars since 2005. The business model for Luxoft’s TEORA is primarily service. TEORA is all about providing the flexibility needed to quickly start highly complex, custom Head Unit projects and enabling the project team to enhance productivity and manage complexity. The added bonus for our partners is that there are no royalties or other hidden costs.

Luxoft has recently acquired Populus Suite. This product originally was created for digital clusters and some of the first car clusters included this technology. Of course, digital clusters are very different from the premium head units that TEORA focuses on. The cost factor is even more important

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Industry Insight

Technology

Car diagnostic mode displayed

and the time–to–market is shorter.

A Digital Cluster is usually a hardware component sourced by OEMs from specialized companies such as Yazaki. Luxoft’s business for Populus therefore, relies on licenses and royalties.

Luxoft now has two HMI tooling families. With these products, we now cover the entire spectrum of technical and business continuums. With Populus, we cover low–end to mid–end devices and focus on unit performance using available and emerging chip sets.

With TEORA, on the other hand, we are focusing on future generation HMI. With both technologies continuing to evolve, Luxoft is now in the position to offer new business models for OEMs and Tier 1.

Luxoft Times editor: vasiliy, how would you wrap up our discussion on HmI & the automotive Industry?

LU xO F T ’ S E x E C U T I v E D IG E ST

Suvorov: Basically I would like to conclude by saying that the Automotive Industry is going through a dramatic transformation where the software is becoming separate from the hardware. The value of HMI is really about revealing the value of vehicles and highlighting customer experience.

I would like to emphasize again that without innovative and flexible HMI capability, it is very difficult to sell new car functionality to people and create the HMI experience the consumer demands.

It is also extremely challenging to leverage consumer electronic technology and graphic user design from Apple, Samsung and Google into the automotive sphere.

Consumer electronics HMI technologies are not Automotive grade because they are not designed to meet automotive requirements.

Successful companies must have

in–depth understanding and experience in the so–called "human factors"and car ergonomics in order to tackle this challenge. With a unique combination of technology, global footprint, and design know– how, Luxoft is well–positioned to do just that.

1 IaLICIa BOLER–DaVIS, HEaD Of CUSTOMER EXPERIENCE

aT GM, ROUND TaBLE BY JD POWERS & aSSOCIaTES vaSILIy SuvoRov HaS OVER 15 YEaRS Of SOfTWaRE aND SYSTEMS DEVELOPMENT EXPERIENCE. HE HaS LED MaNaGEMENT POSITIONS IN INTERNaTIONaL TELECOM aND HI-TECH COMPaNIES, WHERE HE WaS RESPONSIBLE fOR DEfINING TECHNICaL STRaTEGY, DESIGNING aND IMPLEMENTING REaL -TIME aND MISSION -CRITICaL SOfTWaRE SYSTEMS. VaSILIY SERVES aS VP Of TECHNOLOGY STRaTEGY aT LUXOfT WHERE HE DEfINES aND DRIVES COMPaNY TECHNOLOGY STRaTEGY aCROSS ITS KEY LINES Of BUSINESS. VaSILIY HOLDS EXECUTIVE CERTIfICaTE IN STRaTEGY aND INNOVaTION fROM MIT SLOaN SCHOOL Of MaNaGEMENT.

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Industry Insight

FeaTuRed SoLuTIon: popuLuS SuITe

Luxo’s benchmark HMI Soware Development Team expands its portfolio of tools for developing Human Machine Interface (HMI) with Populus Suite.

By denis kryukov

p

opulus is a complete tool chain used for designing, developing and deploying user interfaces for distributed embedded systems. It was acquired

by Luxoft from a subsidiary of Delphi Automotive. Currently, there are more than 7 million vehicles manufactured by leading U.S. and Scandinavian OEMs, which feature HMIs developed using Mecel Populus Suite.

Populus Suite complements Luxoft’s offering in its Automotive vertical. Luxoft now has two major solutions for HMI development: Populus and Teora.

“Populus has been used in the automotive industry since 2007 and some of the first cars with digital clusters have this technology implemented,” says Luxoft’s vice President of Technology Services vasiliy Suvorov. “Teora is the universal Infotainment HMI development platform that is adjusted by out teams for each Head Unit project, and Populus is the off– the–shelf high–productivity HMI creation platform for Hardware Tier 1 targeted at Digital Cluster HMIs.

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We now cover the complete continuum of HMI needs in a car, while also offering business model flexibility. “ Luxoft’s Teora, an HTML and native 3D solution for HMI development, is used in mid to high–end head units and rear–seat entertainment projects. One of the key differences between Teora and Populus is the business model: while Teora is given to customers as a part of Luxoft’s services, Populus is sold as a product with respective royalties and licensing components.

“Populus Suite is easy to use, since no C++ coding is required,” explains Mr. Arwed Richert, from Luxoft’s Technology Strategy Center in Germany. “HMI is created and verified in Populus Editor without having to write any software. The HMI is then downloaded to the target environment where Populus Engine executes it. Populus has been designed for the automotive industry to deliver high performance user interfaces with short time-to-market turn around and to enable efficient software lifecycle management."

The central role in Populus Suite is played by Open Display

Interface (ODI), a communication protocol specifically designed to work well even with low– bandwidth, embedded distributed systems. It enables the applications to be located on the same Electronic Control Unit (ECU), in another ECU, in the system, or in the Internet cloud.

Populus supports a variety of software components: a Supported platforms include: i.Mx5x, i.Mx6, v850 Dx4, Fujitsu Emerald, Intel Atom, SH–4, TI OMAP, Jacinto 5, and more. a Supported operating systems include: Linux, QNx, AUTOSAR/OSEC, Integrity and Android 4. a Supported graphics APIs include: Open GL/ES 1.1 and 2.0, Open vG 1.1, Dave/Ravin and Fujitsu Pixel Engine.

In addition, Luxoft will provide further project maintenance and support for existing Populus customers. The acquisition gives Luxoft the opportunity to land new projects in the Automotive Industry and build stronger relationships with Original Equipment Manufacturers (OEMs) and Tier 1 Suppliers. #

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Industry Insight

Technology

digital cluster screens generated by populus HmI tool chain

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L U x O F T

events to be noticed Latest in teLecom

sDn & openflow world Congress, october 14-17, Dusseldorf, germany The SDN World Congress is the leading venue for examining new developments, debating issues and showcasing the reality of SDN and NfV – and promises to be another milestone occasion for the entire market, including carriers, data centers and enterprises. Luxoft launched a new product, SuperCloud – an SDN and NfV Services Orchestration framework built to enable today’s telecom operators and large enterprises to transform their traditional network services infrastructure into network function virtualization. Luxoft broadcast two demos, SuperCloud - Luxoft’s SuperCloud NfV orchestration platform and Twister - Luxoft's Open Source test automation framework.

Latest in energy

seg 2014 Denver, october 26-29, Denver, usa The SEG International Exposition brings together more than 350 leading companies, government agencies, and research & educational institutions involved in global oil, gas & mineral exploration, and introduces new advances in engineering, environmental issues, and technology. Luxoft launched Geo Viewer, a smart application designed to visualize geophysical and geological data for Oil and Gas exploration and production companies (E&P) during the 84th annual meeting of the Society of Exploration Geophysicists.

LU xO F T ’ S E x E C U T I v E D IG E S T

Latest in automotive open automotive ’14, october 8, 2014, Detroit, usa Presented by the GENIVI alliance, OPEN automotive '14 explores the relationship between automotive connectivity and the so– called "Internet of Things (IoT)" with carmakers, leading suppliers, automotive consortia and industry analysts. Luxoft’s demo showcase presented allView, a holistic automotive user experience solution based on SmartDeviceLink.

Telematics munich 2014, november 10-11, munich, germany Telematics Munich is Europe's largest and most influential business conference & exhibition for the connected car industry. Over 1000 industry executives and more than 100 pioneering speakers were planning to attend the event this year. Luxoft showcased allView, a holistic automotive user experience solution based on SmartDeviceLink.

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Latest in Finance Risk Data aggregation, governance and

Reporting Conference, november 3-4, nyC, usa.

The Marcus Evans conference offers key benchmarking sessions on what the scale of the BCBS239 project should be as well as how different interpretations of the principles relate to various approaches toward implementation.

Luxoft was a sponsor of the event and showcased Horizon – a Risk Visualizer. Luxoft’s Pierre Castagne participated in a panel: "Can BCBS 239 help change the risk reporting and monitoring culture?" fima europe 2014, november 12-13, london, uk. fIMa is the meeting place for the very best of the reference data and risk management set. Over 200 senior data management professionals from the buy and sell side attended the event for a 360° perspective on how they can ready their organizations to become compliant and ensure their data is profitable. Luxoft was a sponsor of the event. Luxoft’s Kashpal Bhogal participated in a panel called: "The Big Question Panel: The new managed utility model vs managed services – which is truly best for your business?"

2nd edition Risk Data aggregation and Reporting, november 17, london, uk.

The Marcus Evans conference offers a second edition of their premiere gathering.

Benchmarking sessions were invaluable offering approaches to the scale of BCBS239 project, and more. Luxoft was once again sponsor of the event. Luxoft promoted Horizon – a Risk Visualizer. Luxoft’s Pierre Castagne participated in a panel: "Optimizing Software and Visualizing Data."

LU xO F T ’ S E x E C U T I v E D IG E ST

Latest in traveL & aviation The Travel Tech show at wTm, november 3-6, london, uk.

The World Travel Market is the leading global event for the travel industry and a vibrant must– attend B2B event featuring a diverse range of destinations and industry sectors for UK and International travel professionals. Luxoft showcased its latest invention, the GDS Meter.

Built to reinforce performance of travel agencies and GDS providers, the software tool is key to enhancing search to booking conversion rate.

Latest in transportation logistics Cio forum, november 17, amsterdam, The netherlands.

The European Logistics CIO Summit is the event where top IT executives at transport and logistics companies dig into key issues currently impacting IT departments and devise strategies for IT innovation that will usher a company into an era of lasting success.

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L U x O F T

global statistics gLoBaL DeLivery moDeL

u nin te rru pt e D re v en ue g roWt H

22 Offices, 18 Delivery Centers, 14 Countries New locations in 2014: Sofia, Bulgaria; Detroit, MI, USa; Guadalajara, Mexico

Revenue for fY2014: $398.3 million, up 28% Y-o-Y Revenue for 1H of fY2015: $237.4 million, up 31% Y–o–Y

uniQue gLoBaL taLent

Headcount: 8100+ with 80% holding a master's degree or higher qualification

LuXoFt agiLe practice

140+ certified ScrumMasters 1500+ agile practitioners 15+ agile Coaches

LuXoFt investors

Lord, abbett & Co LLC, fidelity Management & Research Co., J.P. Morgan asset Management, T. Rowe Price associates, Morgan Stanley Investment Management

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neW LauncHeD proDucts:

aQusitions

Radius Inc., a Next Generation Technology Solution Provider focused on IoT Mecel Populus Suite, a complete tool chain for designing, developing, and deploying user interfaces for distributed embedded systems

a Populus - Complete development tool chain for automotive HMI designed for OEMs & Tier 1 a SuperCloud - Network function Virtualization (NfV) orchestration platform

a

VP9 - Next-generation Open Video Codec

groWing Faster tHan marKet

IDC’s Worldwide Offshore IT Services market forecasted to grow at CaGR of 12.4% from 2012 to 2017

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emPloyee bRanDing

THe CapSuLe oF aWeSome – 6 WayS To eFFeCTIveLy CapTuRe and deFIne THe Company'S evp

Innovation on all sides of Marketing: discover practical ways to win in the competitive war for brain power. przemek Berendt, vp of Global marketing

I

n the article, "Winning the War for Brain Power," published in the 5th issue of Luxoft Times, we extensively covered the framework Luxoft uses to design, plan and execute our Business to Employee (B2E) initiatives. The framework builds on the marketing fundamentals used by many consumer goods companies to market their products. The journey starts with: identify the target audience, define employee value proposition and then deliver the message and the promise across all moments of truth.

It is a fact that the competitive landscape in the war for brain power is very active across the globe. As companies recognize that they have to compete not only for new business, but also for ensuring a steady supply of new employees – the competence of successful B2E marketing becomes key. The game is no longer about ensuring all marketing plan boxes such as events, social media, and posters are ticked.

It is about defining a unique value

LU xO F T ’ S E x E C U T I v E D IG E ST

proposition, and effectively passing and sustaining it across the entire employee lifecycle.

In the consumer goods world, any given product launched on the market has clearly defined benefits that are marketed to consumers. In case of B2E marketing, the product is the company itself. The challenge is that organizations are very complex entities that continuously evolve.

They adjust to market conditions, reflecting the spirit of its leadership and company culture. Capturing the key differentiators and aligning all stakeholders around them is one challenge; identifying the unique secret sauce of an organization is another, and even more difficult.

What makes the exercise more exciting is the fact that these attributes are not set. Organizations need to routinely look at its EvP and benchmark it against other players on the market to ensure they sustain their 'employer of choice' position.

I believe that marketing is as much an art as it is a science. A B2E marketing team should possess not only the skill to use different marketing tools to capture EvP, but it has to be sensitive enough to

capture insights that are not visible at a first glance, based on which the organization can build a successful communication strategy.

Luckily most organizations already have some quantitative and qualitative data to start the quest for defining a unique EvP. Here are a few ideas on where to find data:

employee satisfaction & engagement survey e annual survey is a great source of data demonstrating how effectively the organization delivers against the expectations of its workforce. It shows whether the promise made before bringing an individual on board is delivered at the second moment of truth (SMOT). By analyzing the results, B2E Marketing teams can identify organizational strengths and weaknesses. One of the ways to think about these surveys is as customer surveys. ey tell what the target group likes and dislikes about the product – that is, the organization.

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Employee Branding

feedback from Recruitment e recruitment team is where you find the finest eyes and ears to what is happening in the external world. ey interact with the target audience on a daily basis. As sales teams gather feedback about the company's product, and identify new needs from the target group, recruitment can do the same with the labor market. B2E leaders should regularly check with recruitment teams, whether there are any shis in candidate sentiment towards the company. e Recruitment Department is also a great source of competitive data.

Speaking to the market regularly they are typically the first to know of any changes in competitors’ recruitment strategy rather than the B2E marketing team.

social media Social media monitoring tools enable B2E marketers to measure reach, and validate sentiment towards the brand among the target audience. On top of standard quantitative data, a thorough analysis can yield insights that enrich a company’s EvP. Are some of the social media comments mentioning your company? ese comments might actually include the secret ingredient you have been looking for and never thought of communicating.

focus groups is traditional marketing tool used by many consumer companies is

LU xO F T ’ S E x E C U T I v E D IG E S T

The Capsule of awesome

a goldmine of information. A well – facilitated focus group with employees, new joiners or candidates can unveil new data points. We recently conducted such a study at Luxo, while working on our latest campaign ‘Join A–Players.’ e results of the study enabled us to not only define the key message of the campaign, but also to develop a creative line that is strategically designed to attract the developers that we hope will join Luxo.

walking around Research Not unlike focus groups, this technique puts the marketer in the field, allowing live interaction with the target group. Whether it is a conversation with employees over morning coffee, or simply stopping by a desk of a trusted friend, the B2E expert should always test whether its company brand delivers on its promise. In one–on–one conversations, people are more willing to share ideas and feedback. It is by far the quickest way of validating marketing assumptions. However, one should beware that in this case sample is very limited, and individuals spoken with may have some bias.

from all the offices of the company around the world that we could use to produce some employer branding content. We designed a capsule – an orange heavy duty box, that included two smartphones that could record video in high definition. We sent it around the world to random employees asking them to document the life at the company from their perspective. Aer six months on the road, and over 60,000 km, the Capsule of Awesome returned to headquarters with 75 GB of outstanding content containing valuable insights.

What we learned at Luxoft is that our EvP evolves over time. As the needs and preferences of our employees and people on the labor market change, so does the company.

The data collection techniques described above are only ideas for sources for drafting an EvP. The process should be followed by testing the redefined EvP with employees and targets, aligning it with the management of the firm, and building a comprehensive plan to communicate it.

Employee value Proposition serves as a corner stone for internal and external communication. The company needs to ensure it is consistent with company’s DNA, and reflects the reality of an employee in his daily work. All functions involved in talent attraction and retention need to be on the same page as to how the company wants to be perceived. Failure to deliver the EvP promise to employees will result in attrition and negative mentions in social media at the ZMOT (Zero Moment of Truth). pRzemySLaW BeRendT JOINED LUXOfT aS MaNaGING DIRECTOR fOR POLaND IN aUGUST 2012, aND HaS SERVED aS VICE PRESIDENT fOR GLOBaL MaRKETING SINCE aPRIL 2011. MR. BERENDT IS RESPONSIBLE fOR THE OVERaLL MaRKETING STRaTEGY Of THE COMPaNY. PRIOR TO JOINING LUXOfT, MR. BERENDT SERVED IN THE GLOBaL BUSINESS SERVICES DIVISION Of PROCTER & GaMBLE, aND aS a BRaNCH MaNaGER Of BETWaRE

go Creative and look for insights Several months ago, the B2E marketing team at Luxo launched the ‘Capsule of Awesome’ project. e objective was to try to capture videos

a MID–SIzE, INTERNaTIONaL SOfTWaRE DEVELOPMENT COMPaNY. PRzEMEK HOLDS aN MaSTER Of SCIENCE DEGREE IN COMPUTER SCIENCE fROM DEPaUL UNIVERSITY IN CHICaGO, IL; a BaCHELOR Of aRTS DEGREE IN COMPUTER SCIENCE fROM THE SCHOOL Of BUSINESS– NaTIONaL LOUIS UNIVERSITY IN POLaND; aND aN aSSOCIaTE DEGREE IN PROGRaMMING fROM BLaCKHaWK TECHNICaL COLLEGE IN THE U.S.

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builDing a beTTeR woRlD

BuILdInG a BeTTeR WoRLd: eduCaTIon, CommunITy & envIRonmenT Luxo continues its quest to build a better, smarter and healthier world for everyone inside and outside the company. Luxo Corporate Social Responsibility projects are focused on three main areas: Education, Environment and Community.

LUXOfT BULGaRIa EMPLOYEES HOST STUDENTS IN THE SOfIa OffICE.

by kinga misiarz, CSR manager

I

n 2014, Luxo launched an impressive set of Corporate Social Responsibility projects in Eastern Europe. Luxo's CSR efforts are directed toward:

LU xO F T ’ S E x E C U T I v E D IG E ST

education. Human progress, healthy economic growth and social development hinge on education. As a global company, Luxo is committed to building an educated community through knowledge–sharing and educational support.

environment. Luxo and its employees are dedicated to protecting the heritage of future generations through environmental protection and sustainable development.

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Building a Better World

LUXOfT’S EMPLOYEES ENCOURaGE STUDENTS TO REaCH fOR THE STaRS!

LU xO F T ’ S E x E C U T I v E D IG E S T

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Building a Better World

Luxo is continually working to reduce its environmental impact, through the development of an official environmental policy and the successful implementation of Environmental Management System requirements.

Community. Luxo places a high value on community service and giving back to local communities. Employees are able to promote and take part in service opportunities with different businesses and non–governmental organizations.

LU xO F T ’ S E x E C U T I v E D IG E ST

education: back To school with luxoft In September, seventy–seven children aged 13 to 18 from less fortunate Bulgarian families visited the Luxo office in Sofia, Bulgaria. e “Reach For e Stars” program seeks to motivate young students to succeed by helping them be prepared for the school year.

Each student received a backpack with school supplies from Luxo to help

them start the year off right. Employees wrote personal messages for each student encouraging them to study hard and build a brighter future for themselves and society. Iliyana Geosheva, Marketing Manager of Luxo Bulgaria, said: “We know that the IT industry is growing fast. ere are many career opportunities in this sphere today, and we need to support the young people of Bulgaria and encourage them to reach for the stars.”

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Building a Better World

MaKING a STaTEMENT TO ‘GO GREEN’: LUXOfT BICYCLES PaRKED IN fRONT Of THE ROMaNIa OffICE.

LUXOfT EMPLOYEES aND PUPILS WELCOMING PROJECT PaRTICIPaNTS.

LU xO F T ’ S E x E C U T I v E D IG E S T

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Building a Better World

STUDENTS SHaRE THEIR COMPUTER KNOWLEDGE WITH SENIORS.

environment: going green in bucharest Luxo Bucharest created a new CSR campaign called “Go Green.” e campaign is bringing more visibility to Bucharest’s environmental problems, while reducing waste and highlighting Luxo’s concern for the natural environment. Luxo will invest in taking care of the 'Luxo Forest' planted by employees in Romania’s Armășești village last year. “We like long–term actions that bring strong results,” said Cosmin Patlageanu, Marketing Manager of Luxo Romania. “is particular forest will reduce the harsh effects of winter winds and snow on nearby villages.”

Other notable activities of the Go Green Campaign that will start in 2014 include the use of recycled paper; the introduction of Luxo bicycles, which will be available to employees as a healthy transportation alternative; custom–designed bins for waste and recycling; and "re–greening" of Luxo's Bucharest office, the Business Complex, with new plants and landscaping.

Krakow, Warsaw, Bialystok and Gdansk, started the “Professor Grandchild” program to prevent senior citizens’ exclusion from the digital realm. e purpose of the project is to help seniors become full– fledged members of the digital world by teaching them basic computer knowledge and skills. Such knowledge will allow seniors to stay in touch with their relatives around the world, keep up–to–date with international news, and better communicate with the younger generation. So far more than

100 seniors have participated in classes. As one of the pupils said, “e organizers had a brilliant idea and it worked out great.” kinga misiaRZ JOINED LUXOfT aS a CSR MaNaGER IN KRaKOW, POLaND IN aPRIL 2013. MISS MISIaRz BRINGS SEVERaL YEaRS Of EXPERIENCE IN RUNNING CSR INITIaTIVES. PRIOR TO LUXOfT SHE WORKED aT CHaLLENGE DENVER fOUNDaTION IN THE USa, aND IN THE WaRSaW OffICE Of MICROSOfT IN THE CSR DEPaRTMENT. KINGa HaS a MaSTER’S DEGREE IN ECONOMICS aND a POST–GRaDUaTE DEGREE IN CORPORaTE SOCIaL RESPONSIBILITY.

Community: meet The Professor Luxo Poland, together with more than 100 students and teachers from

LU xO F T ’ S E x E C U T I v E D IG E ST

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analyst Recognition gartner's taKe on iot service proviDers Gartner Inc., the world’s leading IT research and advisory company, listed Luxoft as a Vendor to Watch in the vendor segment for Services, focusing on key areas such as, System Integration, Product Engineering, and Product Design in its report titled, “Market Trends: IoT adoption in India Will advance at a Slow Pace Through 2020,” by aman Munglani, Ganesh Ramamoorthy, et. al., published by Gartner on October 8, 2014.

Luxoft is listed among leading global providers that are capable to deliver services directly related to the Internet of Things.

gartner's moBiLity report Gartner Inc., the world’s leading IT research and advisory company, listed Luxoft as a system integrator/outsourcer in its report titled, “Implement an Outsourcing Mobile application Development Decision framework to avoid Being Bypassed” by Kris Doering, published by Gartner on april 14, 2014. Luxoft is listed among leading global providers that are capable to achieve the outsourcing goals sought by clients today.

LU xO F T ’ S E x E C U T I v E D IG E S T

gartner's Hype cycLe series

Luxoft has been listed as a sample vendor in seven 2014 Gartner Hype Cycles: a Hype Cycle for application Services, 2014, published by Gartner on august 21, 2014 a Hype Cycle for Mobile applications and Development, 2014, published by Gartner on July 29, 2014 a Hype Cycle for application Security, 2014, published by Gartner on July 28, 2014 a Hype Cycle for Digital Insurance, 2014, by Juergen Weiss, published on July 24, 2014 a Hype Cycle for Operational Technology, 2014,

by Kristian Steenstrup, published on July 23, 2014. a Hype Cycle for Smart City Technologies and Solutions, 2014, by alfonso Velosa et.al, published on July, 22, 2014. a Hype Cycle for Vehicle-Centric Information and Communication Technology (Vehicle ICT), 2014, by Thilo Koslowski, published on July 21, 2014.

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gartner's marKet sHare assessment a The report, “Market Share analysis: IT Outsourcing Services, Worldwide, 2013,” by Bryan Britz, et.al, published by Gartner on May 16, 2014, examined the worldwide IT outsourcing market. Luxoft was one of ten providers on “Top 25 fastest-Growing ITO Providers by annual Growth Rate, 2013 (Millions of Dollars)” to earn market share and to experience a 25.7% growth from 2012 to 2013. a further, “Market Share analysis: Software Support Services, Worldwide, 2013” by Bob Igou, published by Gartner on april 29, 2014, examined the top 10 providers as measured by market share, but also cited five "Notable Vendors," Luxoft being one of those five.

In addition, the report, “Market Share analysis: IT Services, Worldwide, 2013” by Dean Blackmore, et.al, published by Gartner on May 6, 2014, examined the worldwide IT services market. Luxoft is listed 12th on “25 fastestGrowing Providers' annual Growth Rate, 2012-2013 (Millions of Dollars),” indicating Luxoft's 25.6% growth (measured by calendar year revenue).

a

a Lastly, Gartner also noted Luxoft’s increase in market share within the broad IT Services market from 2012 to 2013. Luxoft was elevated by 17 positions in its ranking for total market share, 14 positions for the Banking and Securities, and 7 positions for Communication, Media, and Services. The report titled, “Market Share: IT Services, 2013” by Kathryn Hale, et.al. was published by Gartner on March 31, 2014.

Zinnov's gLoBaL r&D service proviDers (gspr) rating 2014 Luxoft was cited multiple times by zinnov Management Consulting, in one of their highly regarded reports,“Global R&D Service Providers (GSPR) Rating 2014.” The report listed Luxoft in the "Established Category" in their general IT Outsourcing matrix, taking into consderation the following: "specialization, research and development practice maturity (depth and breadth of services), innovation and intellectual property, and eco-system linkages.”

Luxoft was also listed in the Leadership zone for automotive expertise. The ranking for this Leadership zone assesses the Company's: go-to-market strategy, niche capabilities across engineering, embedded and software services, leaderships roles in alliances, solution co-creation with customers, and most importantly practicing a formal culture of innovation.

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latest Hype LuXoFt moves From #41 to #18 in gLoBaL outsourcing 100 ranKing international association of outsourcing Professionals (iaoP), June 2014 The 2014 Global Outsourcing 100 recognizes the world's best outsourcing companies.

These rankings are based on applications received and evaluated by an independent judging panel organized by IaOP. Luxoft’s highest scoring areas were: customer references, company recognitions and employee management.

iaop Features LuXoFt in 2014 Best LeaDers categories international association of outsourcing Professionals (iaoP), June 2014 Best 20 Leaders – financial Services (Banking, Markets) Best 20 Leaders – Technology (Hardware & Software) Best 20 Leaders – Telecommunications Best 20 Leaders – Industry–Specific Services Best 20 Leaders – Information/Comm.

Technology Services Best 20 Leaders– Research & Development Services Best 5 Leaders – Employees in Eastern Europe Best 20 Leaders in US; Best 20 Leaders in UK Best 20 Leaders in Western Europe; Top List Climbers Year to Year.

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LuXoFt receives aWarD For automotive Hmi eXpertise we.ConeCT’s CaR Hmi Concepts and systems 2014 Congress, berlin, germany, august 2014 Luxoft’s reference design platform for in– vehicle user experience (UX), allView, was recognized for “HMI Design Innovation” at the Congress, which took place in Berlin, Germany. Luxoft was honored with second place after Volkswagen. Luxoft was the only IT services company to be recognized.

LuXoFt nameD to soFtWare magaZine’s 32nD annuaL soFtWare 500 software magazine, september 2014 Luxoft has been included in Software 500 Magazine’s annual Software 500 ranking of the world’s largest software and service providers. This is the fourth year of Luxoft’s inclusion, with a current ranking of #168.

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Luxoft Recognized for “HMI Design Innovation” at the we.CONECT’s CAR HMI Concepts and Systems 2014 Congress in Berlin, Germany.

Luxoft’s reference design platform for in-vehicle user experience (UX), AllView, won second prize. This recognition brings Luxoft into the spotlight along with vertical leaders and positioning it as a specialty provider for automotive industry, not an IT outsourcing company.

“This was the first time we comprehensively demonstrated the full extent of Timescape’s capabilities, and we are very excited not only about our achievement of being recognized, but

also our continued progress and contribution within this industry,” said Luxoft’s VP for Technology Strategy, Vasiliy Suvorov.

“Consumers often compare their automotive HMI to their mobile device and other electronics, and the subpar user experience within the car.

Through Timescape, Luxoft has elevated the in-vehicle experience, to one that is not only safe, but one that is as easy to use and enjoyable as one’s mobile device or tablet.” It was a first time

in Luxoft’s history that Luxoft-branded HMI was showcased. Luxoft has developed a number of industry-leading HMIs, which are deployed in many premium cars, but development was always in cooperation with a Tier 1 supplier or a Tier 1 supporting an Original Equipment Manufacturer (OEM). The award is a testament to Luxoft’s extensive HMI expertise, and presents Luxoft as an independent brand to the automotive industry, one that is driving innovation in HMI

design. AllView can support OEMs in optimizing the car user experience and improve safety by reducing driver distraction. The HMI integrates workload management and enables personalized access to media and location content, while taking into account location - and contextrelevant information (weather, workload, trip, terrain, etc.), and engaging with the driver for an enhanced driving experience.

Luxoft GLobaL HeadquarterS BUnDESSTrASSE, 5 6300 zUG, SwITzErLAnD TEL: +41 41 723 2040

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MErGEnTHALErALLEE, 79-81 D-65760 ESCHBOrn/FrAnkFUrT, GErMAny TEL: +49 69 2011 9120

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kLIMEnTOS STr., 41-43, #24, 2nD FLOOr 1061 nICOSIA, CyPrUS TEL: + 35 722 000 843

STADIOnSTrASSE, 66 70771 LEInFELDEn-ECHTErDInGEn, GErMAny TEL: +49 711 49049 200

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nEw BrOAD STr. HOUSE 35, BrOAD STr. LOnDOn EC2M 1nH, Uk TEL: +44 207 194 7629

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rADISHCHEVA STr., 10/14 03680 kIEV, UkrAInE TEL: +38 044 206 1808 SHEVCHEnkO STr., 53 49000 DnEPrOPETrOVSk, UkrAInE TEL: +38 056 787 1221 nEzHInSkAyA STr., 79, BUSInESS CEnTEr "MArSEL" 65023 ODESSA, UkrAInE TEL: +380 48 720 7001

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wALL STrEET, 100, SUITE 503 10122 nEw yOrk, ny, USA TEL: +1 212 964 9900 112TH AVE nE, 1800, STE.270-E 98004 BELLEVUE, wA, USA TEL: +1 425 452 1001

1–VOLOkOLAMSky PrOEzD, 10–3, 123060 MOSCOw, rUSSIA. TEL: +7 495 967 8030

BOHAnnOn Dr., 4400, STE. 235 MEnLO PArk, CA 94025 TEL: +1 650 681 1128

SVErDLOVSkAyA nAB., 44, LITEr B, BLDG. 18 195027 ST. PETErSBUrG, rUSSIA TEL: +7 812 458 7016

HAGGErTy rD, 28175, SUITES 143/145 48377 nOVI, DETrOIT, MI, USA TEL: +1 212 964 9900

kArLA MArkSA STr., 41/7 644042 OMSk, rUSSIA TEL: +7 3812 33 23 08

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qUAnG TrUnG SOFTwArE CITy, TAn CHAnH HIEP wArD, DISTrICT 12, AnnA BUILDInG HO CHI MInH CITy, VIETnAM TEL: +84 85 437 1178